Music is fun and all, but now it’s time to make a crapload of money. And now, Spotify’s biggest investor is stating the obvious out loud. In comments to Reuters this week, Northzone general partner and Spotify board member Par-Jorgen Parson planted the rough timetable on a near-term IPO, just like Pandora.
“We, meaning Northzone, would assume the most logical way of building for the long term would be to IPO the company in a few years time or so.”
Spotify is now valued north of $3 billion, and Northzone says they are the biggest stakeholder outside of the cofounders. And, with well-connected, moneyed backers like Goldman Sachs now on board, the road is smoothly paved towards Wall Street.
There’s only one problem with this: cofounder and CEO Daniel Ek recently said he doesn’t want an IPO, and doesn’t need the capital. In a recent interview with Swedish paper Dagens Industri (in Swedish), Ek pointed to the endless haggles and distortions that going public introduces, including the constant focus on stock price, share valuations, and quarterly earnings reports. Indeed, that is one of the reasons why top executives at Live Nation are rumored to be considering a massive buyback of shares to go private. Other battered music stocks, most notably The Orchard and now-private Warner Music Group, have already been delisted. But all of that can easily get overruled by one simple fact: going public can make a man very, very rich (just ask Tim Westergren). Which is probably why, in the same article, Northzone expressed polite deference to Ek’s wishes. “But, at the end of the day, it is primarily up to the founders to decide how to best build the company for the long haul,” Parson noted. Let’s see.