• Sweden edition
Windfall on the cards for Spotify staff

Windfall on the cards for Spotify staff

Published: 12 Aug 2011 13:37 GMT+02:00
Updated: 12 Aug 2011 13:37 GMT+02:00

According to reports in Computer Sweden, in 2010 the employees were given the chance to pick up shares at a cost of 50 kronor ($7.7 )per share. Although it is unclear how many decided to invest, a total of 6.1 million was raised.

Those that did take up the offer have made a handsome profit – those shares are now worth 2,500 kronor a piece and the employees share of the company is now worth some 293 million.

It is a significant boost for the company, which has recently launched in the U.S. In less than 18 months Spotify’s valuation has tripled, to what analysts now estimate to be around 7 billion. Much of this can be attributed to an injection of capital from Russian Digital Sky Technologies and the American companies Kleiner Perkins and Accel.

However the company is still making heavy losses. The mother company, registered in Luxembourg posted losses of 293 million for 2010.

In Sweden things look more promising. In 2010 the Swedish subsidiary Spotify AB recorded sales of 165 million and made a profit of 50 million - compared with sales of 90 million and a 14 million profit the year before.

Meanwhile, Spotify Sweden AB, which takes care of ad sales, made sales of 87 million and a profit of 12 million.

TT/The Local/gm (news@thelocal.se)

Don't miss...X
Left Right

Your comments about this article

10:48 August 13, 2011 by axiom
i am not a economist but how do you value a company at 7billion when it makes no profits loosing almost 300million a year. I assumed profitability influenced net worth, or I guess in this case its prob reflective of its ability to turn over profits in the long term.

shame spotify isn't making so much money though, it has changed my music listening completely, haven't bought a cd or mp3 in 3years.
11:01 August 13, 2011 by jomamas
Why not 'men start amazing company and lead the path to the future?'.

After all 3 other articles headline 'Man rapes girl' , 'Man murders child' etc. etc..

So - is it ok to identify Men when they commit a crime, but not when they do all the innovation and nation/economy building?

And why not the color and religion of the men? Is that not relevant as well?

It's so obvious that Sweden is 'anti man' this has to be some kind of joke ...
15:26 August 14, 2011 by swedejane
It's vapor wealth until those holding the pre-IPO shares can actually sell them...which won't happen until they go public. And that doesn't appear to be anytime soon. Look at Pandora: 100M users and 36M active paying members and they're break-even or slightly profitable but their stock is trading around the $12 mark. Their royalty payments are a lot less than Spotify as well. Spotify's most recent forecast was to pick up 50M users by next year (so maybe 5-6M paying subscribers)...this will still put them far behind Pandora.

Plus, I'll be dollars to donuts that Pandora issues all employees options as part of their compensation package and not trying to sell it to them, thereby effectively reducing their development/labor costs. That might work in Sweden, but in the US they won't get anybody but the most desperate/least talented developers working for them.

Finally, with the exit of one of their major music catalog providers the labels are going to start seriously re-evaluating this service and the royalty payments, which is going to put even more pressure on Spotify's business model. Not to mention the patent infringement lawsuit by Packet Video (which, I've read, and they probably won't win it but they'll bleed Spotify of even more money trying to fight it). With that said, I like Spotify and use it...despite several weaknesses it has...they should really treat the employees better and offer stock options upfront instead of doing a yearly sell based on whatever their most recent valuation is at the time. They have enough cash in the bank to not go around shaking their tin cup to their employees who are, undoubtedly, already working day and night to make it successful.
10:49 August 16, 2011 by KungsholmenGuy
swedejane agree with what you wrote except that in Sweden the tax implications are vastly better for employees if employees buy shares within a company internal share offering program rather than receiving options or receiving these shares for 'free' from the company (which is then taxed as salary at some obcene tax rate like 56% for the individual, and the company itself pays additional tax on this 'bonus' also). Options are so financially inefficient as to be essentially useless in Sweden, but not in the USA and Canada. Not sure about other countries.
Today's headlines
Property of the Week
In Pictures: The Local's Property of the Week
Photo: Fastighetsbyrån

In Pictures: The Local's Property of the Week

Why settle for owning a house when you can own part of the island it is located on? This week's property allows you to get your money's worth of solitude while spending some time with your closest neighbour - the sea. READ  

Saab buys Swedish submarine shipyard
File photo: TT

Saab buys Swedish submarine shipyard

Swedish defence and aeronautics group Saab said Tuesday it had completed the acquisition of German heavy industry giant ThyssenKrupp's submarine shipyard in southern Sweden. READ  

My Swedish Career
American aims to beat cancer with invention
Matthew Volsky holding the Gynocoular colposcope which is used for screening cervical cancer. Photo: Gynocoular

American aims to beat cancer with invention

When Matthew Volsky first came to Sweden he didn't think he would stick around. Six years and a pioneering invention later he tells The Local about the medical device which is helping save lives around the world. READ  

'The Danish narrative on Sweden is based on a lie'
File photo: Shutterstock

'The Danish narrative on Sweden is based on a lie'

There is a popular narrative that in Sweden people bite their tongues while in Denmark they speak their minds; political commentator Brian Esbensen debunks this, arguing that Danes simply find it easier to criticize others. READ  

Swedish cops elect not to shoot 'angry elks'

Swedish cops elect not to shoot 'angry elks'

After reports that wandering elks were scaring the public, police on the island of Frösön have decided not to open fire on the animals, but have urged locals to exercise caution instead. READ  

Swedish funds to tackle female genital mutilation
Sweden's Minister of International Development Cooperation Hillevi Engström with Foreign Minister Carl Bildt. File photo: TT

Swedish funds to tackle female genital mutilation

Sweden has earmarked 48 million kronor ($7 million) of its development aid budget to a United Nations programme to tackle female genital mutilation. READ  

Swedish leaders speak out on Gaza crisis
Photo: TT

Swedish leaders speak out on Gaza crisis

Swedish foreign minister Carl Bildt believes Israel is interested in negotiating a ceasefire with Hamas while Social Democrat leader Stefan Löfven has stood by his comment about the Israelis having a right to defend itself. READ  

New rules threaten micro-breweries
File photo: Systembolaget

New rules threaten micro-breweries

Swedish micro-breweries have reacted with concern to new distribution regulations being imposed by the state controlled alcohol monopoly Systembolaget, which they fear may put them out of business. READ  

ABB and Volvo in electric buses tie-up
Volvo hybrid bus. Photo: Volvo Buses

ABB and Volvo in electric buses tie-up

Swiss-Swedish engineering group ABB and Volvo Buses of Sweden have announced a joint project to develop a system for electric buses to recharge their batteries fast when at bus stops. READ  

'First ever' heat warning issued for Sweden
Photo: TT

'First ever' heat warning issued for Sweden

Swedish weather agency SMHI has issued its first ever warning for high temperatures with the many areas set to bask in plus 30C heat. READ  

People-watching Båstad
Business & Money
Sweden falls to third in global innovation index
Swedish ornithologists keep webcam watch
Photo: Andreas Nordström/Image Bank Sweden
Top ten Swedish beach hot spots
Swedish Wiki vet sets new content record
Blog updates

22 July


"Today (22 July) my Prime Minister, David Cameron, and UNICEF, are hosting the world’s first #GirlSummit in London. The Summit’s aim is to mobilise domestic and international efforts to end the appalling practices of Female Genital Mutilation (FGM) and Child Early Forced Marriage (CEFM). This is a high priority for the UK government and the Prime..." READ »


18 July

Starting over (Around Sweden in a kayak) »

" I’ve now been off the water for almost 14 days. At first I was totally gutted being forced into a rest period, I had Stockholm in my sights and apart from the pain and discomfort in my shoulder, spirits were high and I was starting to gain some momentum. The news hit me fairly hard and..." READ »

Photo: Fastighetsbyrån
In Pictures: The Local's Property of the Week
Photo: Finest.se
People-watching July 15-16
Photo: Ola Ericson/Image Bank Sweden
What's On in Sweden
Photo: Lisa Mikulski
Hope springs eternal for expat pet shop owner
Princess Estelle steals limelight at mum's birthday
Swedes risk infants' lives by covering up prams
Swede runs for office just using Bitcoin funds
People-watching July 11-13
Malmö mayor slams Danish beggar ban
Swedish anti-abortion midwife sues county
Swede's salary chopped for Facebook use
Northern Sweden warmest in 90 years
'Victoria Day': Crown Princess Victoria turns 37
Mona Sahlin to fight extremism in Sweden
EU tells Sweden to cover up snus flavours
Swede snags assassin role in Tom Cruise film
Top ten ways to spend a few days in Malmö
Swedish summer tourism highlights
Sponsored Article
Introducing... Your finances in Stockholm
Sponsored Article
Introducing... Housing in Stockholm
Latest news from The Local in Austria

More news from Austria at thelocal.at

Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Denmark

More news from Denmark at thelocal.dk

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

jobs available
Swedish Down Town Consulting & Productions
Swedish Down Town Consulting & Productions is an innovative business company which provides valuable assistance with the Swedish Authorities, Swedish language practice and general communications. Call 073-100 47 81 or visit:
If you want to drink, that’s your business.
If you want to stop, we can help.

Learn more about English-language Alcoholics Anonymous in Sweden. No dues. No fees. Confidentiality assured.
PSD Media
PSD Media is marketing company that offers innovative solutions for online retailers. We provide modern solutions that help increase traffic and raise conversion. Visit our site at: