Word came out earlier last week that Soundcloud laid off 40% of its staff in a bid to become profitable. A statement by the company indicated that the layoffs would help stabilize the company. Now however a new article by TechCrunch described a more dire situation where even with the recent layoffs the company only has enough cash to last until the 4th quarter… 50 days away!
One anonymous employee told TechCrunch “it’s pretty sh*tty. Pretty somber. I know people who didn’t get the axe are actually quitting. The people saved from this are jumping ship. The morale is really low.”
Another employee said “I don’t believe that people will stay. The good people at SoundCloud will leave. Eric [Wahlforss] said something about the SoundCloud ‘family,’ and there were laughs. You just fired 173 people of the family, how the f*ck are you going to talk about family?”
While Soundcloud has been a major part of the dance music scene since its inception, it appears as though if they cannot acquire more paying subscribers and/or raise more venture capital that their days may be numbered either as an independent entity or being gobbled up by a competitor.
Soundcloud just released a statement today concerning the Tech Crunch article:
“There are a number of inaccuracies within the TechCrunch article. They seem to stem from a misinterpretation of information by one or two laid off employees during a recent all hands meeting. Due to the extensive number of inaccuracies, we will only comment regarding funding and layoffs. To clarify, SoundCloud is fully funded into the fourth quarter. We continue to be confident the changes made last week put us on our path to profitability and ensure SoundCloud’s long-term viability. In terms of layoffs, it is our policy not to discuss individual employee cases, but we can share we continue to work with all employees who were let go to support them during this transition, with employment and financial assistance.”