SoundCloud has announced that it will make redundancies affecting approximately 20 per cent of its global workforce.
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“During this difficult time, we are focused on providing the support and resources to those transitioning while reinforcing our commitment to executing our mission to lead what’s next in music,” the company wrote in a statement shared to Variety.
CEO Michael Weissman sent an email to SoundCloud employees yesterday (August 3) to announce the lay-offs, which will impact employees worldwide.
“Today’s change positions SoundCloud for the long run and puts us on a path to sustained profitability,” Weissman said in the email. “We have already begun to make prudent financial decisions across the company and that now extends to a reduction to our team.”
Variety noted that the news follows recent partnerships with Pandora and Splice, an acquisition of the artificial intelligence company Musiio, and a partnership with the management and creative services company Solid Foundation.
Weissman’s email also said that SoundCloud employees in the UK and the US “will be notified over the next few days” on the status of roles within the company.
The company claimed later that the Portishead song ‘SOS’ earned 500 per cent more under the new royalty system than it had under the “pro-rata” model used by Spotify and others streaming services.
The ‘Sounds Creator Fund’ applies to unsigned acts who are using Distrokid on Snapchat. According to Variety, each song can get a monthly grant of up to $5,000 (£4,099) with a cap at 20 songs.