Brain Drain At Spotify HQ
While Spotify’s number may look great (113 million paid subscribers is nothing to sneeze at) the company seems to be going through quite a bit of turmoil behind the scenes, and suffering serious brain drain in the process.
Guest post by Bobby Owsinski of Music 3.0
Despite the good news that Spotify is now up to 113 million paid subscribers, behind the scenes there’s a lot of turmoil in the company. There’s been a brain drain of 33 senior company executives in the last three years, and one has to wonder why.
According to a post on Music Business Worldwide, Spotify continues to shed executives, and with them goes much of the company’s institutional knowledge. You probably don’t know the names of the execs that have left, so I’ll just name some of the positions.
- Chief Financial Officer
- Global Head Of Music
- Chief Account Officer
- Head Of Artist Marketing
- Global Head Of Curation
- Chief Economist
- Head Of Music Culture And Editorial
- Global Head Of Advertising
- Head Of Partnerships For Content And Creators
- Global Head Of Publishing
- Global Head Of Communications
Keep in mind that these are the just the executives that have left Spotify this year alone!
You can come to a number of conclusions about the executive’s rush for the doors. The first is that they wanted to cash out their stock options thanks to the company going public. But more than 20 execs left before the company became public, and you don’t have to leave the company to cash out.
The second is that the majority of execs left for other positions within the music business, mostly with labels or other streaming services. In this case you can say that Spotify was a good place to get some digital chops together before jumping for a better gig.
But yet another conclusion is that these execs knew all too well what’s going on in the upper echelons of the company and wanted to bail before things got tough. Spotify still isn’t profitable, it’s now at the beck and call of Wall Street, and the competition is getting fiercer from companies that don’t have to make money from streaming (namely Apple and Amazon).
The company continues to try to generate other sources of revenue, but so far they’ve not impacted the bottom line much. Plus, without high-margin hardware to sell and high licensing fees from the labels to contend with, you wonder if the company will soon reach a ceiling on the amount of money it can generate.
Don’t get me wrong, I like the service and use it myself, but given the continuous brain drain that’s happening, it’s not a stock I would put my money into.