Spotify's Co-Founders Keeping Control After Going Public This Year

Spotify is one of the more anticipated IPO's for later this year, and while there's no set date for Spotify's IPO just yet, there is talk about who would be in control of the company. Spotify's co-founders are actually doing something that Google (now Alphabet) and Facebook have done. And that is by doing a dual-class structure for making the company public. This means that co-founders and other executives at Spotify, would trade one class of stock which would give them super-voting power. While the other class is traded by anyone who wants to purchase Spotify stock.

A dual-class stock option is pretty popular among companies that want the advantages of being a publicly traded company, but don't want to give up ownership of the company. Since shareholders are technically owners of the company, they would be able to vote on things like acquisitions. With Spotify doing it this way, shareholders wouldn't have a say, but this doesn't mean that Spotify will not keep shareholders happy. Since every company wants a decent stock price. Companies like Snap Inc., Facebook and Alphabet all employ this dual-class stock option, so it's not something that's new, or even for newly public companies - since Alphabet has been public for around 14 years now. Some believe its unfair, but it is not against the law.

Spotify is currently the largest paid music streaming service, larger than Apple Music, Google Play Music and even Pandora. So that when it does do its initial public offering or IPO later this year, it's likely going to garner a lot of attention, even though its co-founders won't be giving up control of the company. Spotify, though, has had trouble making a profit each quarter. Now where Spotify is still a private company, for now, it doesn't release its numbers each quarter like a public company would. But with the numbers Spotify has released, it has yet to turn a profit. Which isn't a good thing, and it's something Spotify needs to rectify before it does go public, or its stock could take a huge hit. As of now, there's no word on when Spotify is planning to do its IPO, but many analysts believe it'll take place over the summer.

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Alex has written for Androidheadlines since 2012 as Editor of the site and traveled the World to many of the biggest Smartphone and Technology events. Alex has a background in Technology and IT and Deep Passion for Everything Android and Google. His specialties lay in Smartphones of all budgets, Accessories, Home Automation and more. Contact him at [email protected]
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