Reports say the company has 50 days before their finances run out.
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UPDATE: Soundcloud has shared a statement that disputes the veracity of TechCrunch's report. You can find it in full after the piece. The report also prompted a continuing outcry of concern from artists, including Chance the Rapper's claim he was working on it.
Last week, Soundcloud announced that it would lay off 40 percent of its staff in order to not completely go under after repeated attempts to keep the company afloat. The news was greeted with unsurprised sighs, but as a new report by TechCrunch reveals, the situation at the company's HQs may be more dire than previously thought.
The story allegedly uses leaked info from an "all-hands" global conference meeting that took place in Soundcloud's main offices at New York and Berlin and paints a hopeless picture for the company. Apparently, founders Alex Ljung and Eric Wahlforss told employees that the layoffs merely created enough overhead to keep operations moving comfortably until the beginning of Q4, after which there would be no more expendable finances. Soundcloud's PR is said to have told TechCrunch that the company is "fully funded" during the 50-day lead up to Q4. So, to clarify, the site probably won't be totally inactive after 50 days but it and the company will just be in an incredibly unstable state (the story mentions that the company is reportedly looking at potential investors to inject Soundcloud with the infusion of cash it needs to keep trucking).
Employees who were present at the conference also described it to TechCrunch as a "shitshow" and said the morale among what's left of the staff is "really low," with a few having apparently already quit their jobs. Naturally, the community of producers and DJs and musicians who rely on Soundcloud are both panicking and urging others to take their music off the site in case it does go inactive.
All of this sucks, not just because people are losing their jobs and artists could potentially lose entire bodies of work, but also because it's pretty unlikely that big, for-profit firms are going to have faith in Soundcloud's user-generated model after this public, years-long decline. You can read the whole story here. Don't trust your valuable, irreplaceable art to a commercialized internet run by ad revenue, dudes.
Here's Soundcloud's full statement, via Variety:
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.
Phil is shaking his head on Twitter.