SoundCloud, the Germany-based online music streaming platform that counts social media company Twitter as an investor, is set to sell a majority stake to two investors, Bloomberg reported today.
The investors in question are Singaporean state-owned investment firm Temasek and boutique investment bank Raine Group, which would buy stakes in the company through separate deals, according to people familiar with the matter, who told Bloomberg negotiations have reached an advanced stage.
SoundCloud has built an online platform that allow users to upload, promote and share music, and the product has proven popular in particular with independent artists and remixers. It claimed in mid-2015 to have 175 million monthly users.
The company was relatively slow to monetise however, and only introduced a paid subscription option in March 2016, nine years after it was founded. It has faced financial struggles of late, and earlier this month announced it would be cutting its headcount by 40%.
The proposed deal would follow about $190m in equity funding and $105m in debt financing, $70m of which came through a credit line provided by Ares Capital, Kreos Capital and Davidson Technology in March this year.
Twitter, which had previously explored an acquisition of SoundCloud, invested $70m in the company in June 2016 through its Twitter Ventures unit at a $700m valuation.
SoundCloud’s other backers include online media holding company Chernin Group, which invested as part of a $60m series D round in 2014, as well as Institutional Venture Partners, Kleiner Perkins Caufield & Byers, GGV Capital, Index Ventures, Union Square Ventures and Doughty Hanson Technology Ventures.
– This article was adapted on August 2, 2017 to reflect a more recent report identifying the prospective investors.