The history of Spotify - one of the mostpopular music streaming services
General Information
Founded 23 April 2006 Headquarters Stockholm, Sweden Founders Daniel Ek, Martin Lorentzon Industry Audio streaming Podcasting No. of locations 15 offices Revenue €13.25 billion (2023) Operating income €–446 million (2023) Net income €–532 million (2023) Total assets €8.35 billion (2023) Total equity €2.52 billion (2023)
| Founded | 23 April 2006 |
| Headquarters | Stockholm, Sweden |
| Founders | Daniel Ek, Martin Lorentzon |
| Industry | Audio streaming Podcasting |
| No. of locations | 15 offices |
| Revenue | €13.25 billion (2023) |
| Operating income | €–446 million (2023) |
| Net income | €–532 million (2023) |
| Total assets | €8.35 billion (2023) |
| Total equity | €2.52 billion (2023) |
Early story (2005 - 2009)
2005: Daniel Ek began working as a consultant for the Swedish advertising company TradeDoubler, where he met the company's founder, Martin Lorentzon. He also worked at Stardoll, but in the winter he became depressed and decided to create his own company, which he began immediately.
May 2006: Martin sold TradeDoubler shares for 180 million Swedish kronor, allocated 10 million to Daniel. Daniel left his job at Stardoll. The spotify.com domain was registered in April, and the joint stock company Spotify AB was created in June.
August 2006: Spotify's first office opens in Stockholm. In the fall, the company acquired Torrent from Ludwig Striegeus, who joined Spotify.
January 2007: Fredrik Niemäle developed the Queue function for downloading songs. Fred Davis explained to Daniel the need for exclusive contracts with each record company.February 2007: Daniel moved to London and established Spotify's head office there.
April 2007: A beta version of the Spotify app was released in Sweden, available by invitation.
2007-2008: The company suffered losses of SEK 31.8 million in the first year and more than 60 million in the second year. Spotify sought investors without success, but the founders put up their own money, which helped convince the labels to collaborate.
2008: Official launch of the service in a number of European countries. Collaboration: Spotify has struck deals with phone companies Telia in Sweden and Three UK in the UK to bundle streaming and mobile payments.
2005: Daniel Ek began working as a consultant for the Swedish advertising company TradeDoubler, where he met the company's founder, Martin Lorentzon. He also worked at Stardoll, but in the winter he became depressed and decided to create his own company, which he began immediately.
May 2006: Martin sold TradeDoubler shares for 180 million Swedish kronor, allocated 10 million to Daniel. Daniel left his job at Stardoll. The spotify.com domain was registered in April, and the joint stock company Spotify AB was created in June.
August 2006: Spotify's first office opens in Stockholm. In the fall, the company acquired Torrent from Ludwig Striegeus, who joined Spotify.
January 2007: Fredrik Niemäle developed the Queue function for downloading songs. Fred Davis explained to Daniel the need for exclusive contracts with each record company.February 2007: Daniel moved to London and established Spotify's head office there.
April 2007: A beta version of the Spotify app was released in Sweden, available by invitation.
2007-2008: The company suffered losses of SEK 31.8 million in the first year and more than 60 million in the second year. Spotify sought investors without success, but the founders put up their own money, which helped convince the labels to collaborate.
2008: Official launch of the service in a number of European countries. Collaboration: Spotify has struck deals with phone companies Telia in Sweden and Three UK in the UK to bundle streaming and mobile payments.
Expansion and consolidation (2010 - 2017)
2010: Spotify begins to compete with alternative services such as iTunes. Daniel claims that Steve Jobs called him. According to journalists, Apple prevented the launch of Spotify in the United States.
2011: Head office in London is closed, key employees move to Stockholm. In May, a limit was introduced to listen to music up to 10 hours per week for free accounts (later canceled). On July 14, the service was launched in the United States. Spotify paid the three largest US labels 20% of its shares and several hundred million dollars for rental licenses. In 2011, the company suffered a loss of $50 million.
2012: Discover launched for personalized music recommendations.
2013: Spotify buys Tunigo and begins to focus on playlists. In the summer, a growth crisis began due to the lack of a mobile application, which was only approved in the App Store in December. In November, the company received a $250 million investment from Technology Crossover Ventures, which allowed it to abandon torrent technology and shut down the Spotify API protocol.
2014: Acquired analytics firm Echo Nest for algorithm-based recommendations. Discover Weekly launched. In January 2015, the service was included in PlayStation software.
2015: Launch of Spotify Running, a feature that lets you select music based on your running pace. Launch of the '3 months for 99p' advertising campaign. Analytics company Seed Scientific was acquired.
2016: Launched the Release Radar tab for new compositions by your favorite artists. By September, Spotify had paid out $5 billion in royalties.
2017: Spotify rents an office in New York for $11 million a year and moves to 4 World Trade Center in September 2018.
2010: Spotify begins to compete with alternative services such as iTunes. Daniel claims that Steve Jobs called him. According to journalists, Apple prevented the launch of Spotify in the United States.
2011: Head office in London is closed, key employees move to Stockholm. In May, a limit was introduced to listen to music up to 10 hours per week for free accounts (later canceled). On July 14, the service was launched in the United States. Spotify paid the three largest US labels 20% of its shares and several hundred million dollars for rental licenses. In 2011, the company suffered a loss of $50 million.
2012: Discover launched for personalized music recommendations.
2013: Spotify buys Tunigo and begins to focus on playlists. In the summer, a growth crisis began due to the lack of a mobile application, which was only approved in the App Store in December. In November, the company received a $250 million investment from Technology Crossover Ventures, which allowed it to abandon torrent technology and shut down the Spotify API protocol.
2014: Acquired analytics firm Echo Nest for algorithm-based recommendations. Discover Weekly launched. In January 2015, the service was included in PlayStation software.
2015: Launch of Spotify Running, a feature that lets you select music based on your running pace. Launch of the '3 months for 99p' advertising campaign. Analytics company Seed Scientific was acquired.
2016: Launched the Release Radar tab for new compositions by your favorite artists. By September, Spotify had paid out $5 billion in royalties.
2017: Spotify rents an office in New York for $11 million a year and moves to 4 World Trade Center in September 2018.
International expansion and diversification (2018 - now)
2018: IPO and Valuation: Spotify's IPO valued one share at $132 and the entire service at $23.5 billion. Financial results: Despite stable revenue growth, the company's loss reached $394 million for the 2nd quarter of 2018. The only profitable quarters were the last quarter of 2018 and the first quarter of 2019, thanks to the entry of mega-company Tencent, of which Spotify is a shareholder, into the stock exchange.
2019: Acquisition of podcasting companies: In February 2019, Spotify acquired Gimlet Media Inc. and Anchor FM Inc. for $340 million. The company planned to spend $500 million on podcasts by the end of the year, viewing them as a serious advertising opportunity. Virtual assistant for the car: Spotify is testing its first digital device, the virtual assistant for the car 'Car Thing', but does not yet plan to release it to the general public. Investments in cryptocurrency: Spotify became an investor in Facebook Libra cryptocurrency.
2020: Geographic expansion: On July 15, Spotify began operating in the following countries: Russia, Kazakhstan, Belarus, Ukraine, Slovenia, Albania, Croatia, Serbia, North Macedonia, Bosnia and Herzegovina and Moldova.
2021: Greenroom Launches: In June, Spotify announced the launch of an audio platform called Greenroom, which has similar features to its Clubhouse audio service. Users can launch audio rooms of up to 1 thousand people, the host will be able to give the floor to connected users.
2022: Removal of Neil Young's music: In January, Spotify was forced to remove Neil Young's music at his request due to allegations that Joe Rogan's podcast was spreading misinformation about COVID-19. As a result, the service has added special labeling for podcast episodes that discuss the topic of coronavirus, taking users to a portal created by Spotify with up-to-date information from scientists, doctors and public health authorities.
2023 - now: Over the past few years, Spotify has made significant progress in investing in the personalization of its products, discovery algorithms, and areas that are becoming increasingly popular (audiobooks, popular shows, and podcasts). Despite great competition from such music streaming services as YouTube Music, Apple Music, Amazon Music, Spotify remains one of the main leaders in the music streaming market, and continues to develop, gain new audiences and retain existing ones.
2018: IPO and Valuation: Spotify's IPO valued one share at $132 and the entire service at $23.5 billion. Financial results: Despite stable revenue growth, the company's loss reached $394 million for the 2nd quarter of 2018. The only profitable quarters were the last quarter of 2018 and the first quarter of 2019, thanks to the entry of mega-company Tencent, of which Spotify is a shareholder, into the stock exchange.
2019: Acquisition of podcasting companies: In February 2019, Spotify acquired Gimlet Media Inc. and Anchor FM Inc. for $340 million. The company planned to spend $500 million on podcasts by the end of the year, viewing them as a serious advertising opportunity. Virtual assistant for the car: Spotify is testing its first digital device, the virtual assistant for the car 'Car Thing', but does not yet plan to release it to the general public. Investments in cryptocurrency: Spotify became an investor in Facebook Libra cryptocurrency.
2020: Geographic expansion: On July 15, Spotify began operating in the following countries: Russia, Kazakhstan, Belarus, Ukraine, Slovenia, Albania, Croatia, Serbia, North Macedonia, Bosnia and Herzegovina and Moldova.
2021: Greenroom Launches: In June, Spotify announced the launch of an audio platform called Greenroom, which has similar features to its Clubhouse audio service. Users can launch audio rooms of up to 1 thousand people, the host will be able to give the floor to connected users.
2022: Removal of Neil Young's music: In January, Spotify was forced to remove Neil Young's music at his request due to allegations that Joe Rogan's podcast was spreading misinformation about COVID-19. As a result, the service has added special labeling for podcast episodes that discuss the topic of coronavirus, taking users to a portal created by Spotify with up-to-date information from scientists, doctors and public health authorities.
2023 - now: Over the past few years, Spotify has made significant progress in investing in the personalization of its products, discovery algorithms, and areas that are becoming increasingly popular (audiobooks, popular shows, and podcasts). Despite great competition from such music streaming services as YouTube Music, Apple Music, Amazon Music, Spotify remains one of the main leaders in the music streaming market, and continues to develop, gain new audiences and retain existing ones.