SoundCloud: A Success Story

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SoundCloud: A Success Story

  1. 1. Introduction SOUNDCLOUD Ryan Kam
  2. 2. Introduction October 2008 Launched by Alex Ljung and Eric Wahlforss
  3. 3. Introduction October 2008 April 2009 €2.5m Series A round led by Doughty Hanson Tech Ventures
  4. 4. Introduction October 2008 April 2009 May 2010 1 million registered users
  5. 5. Introduction October 2008 April 2009 May 2010 June 2011 5 million registered users
  6. 6. Introduction October 2008 April 2009 May 2010 June 2011 January 2012 $50m round led by Kleiner Perkins Caufield & Byers
  7. 7. Introduction October 2008 April 2009 May 2010 June 2011 January 2012 Today 40 million+ registered users
  8. 8. 0 5000 10000 15000 Soundcloud Pandora Spotify 8tracks Songza SoundCloud leads all major internet streaming music services in global web traffic Sources: www.alexa.com as of 08/19/2013 Alexa Global Traffic Rank (lower is better) Introduction
  9. 9. 0 5000 10000 15000 Soundcloud Pandora Spotify 8tracks Songza 200m unique visitors per month Sources: www.alexa.com as of 08/19/2013 Alexa Global Traffic Rank (lower is better) Launched a decade earlier Introduction Declining “Curated” music: not quite there but rising fast “Curated” music: not quite there but rising fast SoundCloud leads all major internet streaming music services in global web traffic
  10. 10. Why has SoundCloud been so successful? Introduction
  11. 11. Or, rephrased: What makes SoundCloud different from the competition? Introduction
  12. 12. Or, rephrased: What makes SoundCloud different from the competition? Introduction
  13. 13. Three things. Analysis
  14. 14. Analysis Popularity of electronic dance music Better features and fewer restrictions Unprecedented global reach Leading share of internet streaming music market + Strong growth prospects
  15. 15. Analysis Popularity of electronic dance music Better features and fewer restrictions Unprecedented global reach Leading share of internet streaming music market + Strong growth prospects
  16. 16. Electronic dance music, often abbreviated to EDM, is electronic music that is produced primarily for the purposes of use within a nightclub setting, or in an environment that is centred upon dance-based entertainment.
  17. 17. Analysis
  18. 18. Analysis
  19. 19. DJ Mag’s Top 100 DJs that have an active SoundCloud account *As of 08/19/2013 Analysis
  20. 20. DJ Mag’s Top 100 DJs that have an active SoundCloud account *As of 08/19/2013 Analysis SoundCloud is the preferred channel for DJs and producers to connect with fans
  21. 21. Analysis Popularity of electronic dance music Better features and fewer restrictions Unprecedented global reach Leading share of internet streaming music market + Strong growth prospects
  22. 22. A polished interface allow for enhanced shareability, greater customization, and a superior listening experience overall Follow artists directly or users with similar tastes Tagging enables easy “discovery” of similar content Tagging enables easy “discovery” of similar content Follow artists directly or users with similar tastes Continuous stream of targeted user- generated content Analysis
  23. 23. Ads Save and revisit single tracks SoundCloud also has far fewer restrictions on how its users can create and consume content Restrictions Skips FF/Rewind Who can upload music SoundCloud Spotify 8tracksPandora No No No Yes Yes Yes Yes Yes Yes Yes Yes Yes Other nuisances No Yes Yes Yes None Yes – pay to remove Yes – pay to remove Yes – pay to remove Listening limits None Yes – pay to remove Yes – pay to remove Yes – pay to remove Analysis
  24. 24. Analysis Popularity of electronic dance music Better features and fewer restrictions Unprecedented global reach Leading share of internet streaming music market + Strong growth prospects
  25. 25. SoundCloud is available anywhere you can connect to the internet Pandora Spotify SoundCloud Analysis
  26. 26. Pandora Spotify SoundCloud SoundCloud is available anywhere you can connect to the internet Analysis
  27. 27. Pandora Spotify SoundCloud SoundCloud is available anywhere you can connect to the internet Analysis
  28. 28. 40 40 20 100 0 20 40 60 80 100 120 EDM Features Reach Total SoundCloud’s advantage stems primarily from its superior features and usability, and the current popularity of EDM Contribution to total competitive advantage, % *Estimated Competitive advantage generated by listeners… • Looking for new releases posted first on SoundCloud • Frustrated by paywalls and instrusive restrictions • Seeking to diversify their tastes in music beyond Top 40 Conclusion
  29. 29. Talk to me! Ryan Kam, Student at Rotman Commerce E: ryanplkam@gmail.com T: 647 292 8175 Contact

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