Amid the tech market chaos currently roiling the stock market, another tech company makes its debut today. Spotify, the industry leader in music streaming, will follow the lead of other social-tech corporations like Facebook, Twitter, and Snapchat, and will begin trading on the New York Stock Exchange.
Spotify currently corners the streaming music market, boasting a global user base of 157 million—nearly half of whom pay a monthly subscription fee. So far they have managed to fight off challenges by Apple Music, Tidal, and Pandora, remaining the industry standard for people abandoning tangible music mediums and full downloads in favor of online streaming.
With its foray into the stock market, analysts think the company could command a valuation of over $20 billion.
That’s a boatload of money—especially for a company that currently isn’t profitable.
In the last five years, Spotify has accrued losses near $3 billion. For that reason alone, entering the market with its tech peers carries immense risk. We’ve seen what has taken place at Twitter since its IPO, as the company has struggled to find unique footholds to churn gains for investors. While Spotify is the go-to platform for streaming, going public injects new pressure to post profits.
We’ll keep an eye on the market today and the weeks ahead to see what Spotify’s listing may mean for the corporation going forward.