Chance the Rapper May Have a Plan to Rescue SoundCloud From Rumored Collapse

SoundCloud co-founder and CEO Alex Ljung assured listeners and artists that the company was in control of its “independent future” and on a path to “profitability” after laying off 173 staffers last week. In a subsequent report forum TechCrunch, however, the situation is supposedly much more dire. Eventually, news of SoundCloud’s current (alleged) status even prompted a response from Chance the Rapper.

Sources claimed Wednesday that Ljung and co-founder Eric Wahlforss said during a recent meeting that the layoffs saved them enough money to continue until the fourth quarter, which kicks off in 50 days. Following the sources’ claims, a SoundCloud spokesperson told Complex the company was “fully funded into Q4” and was currently in talks with potential investors. Read the statement in full below:

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.

In his initial statement on the layoffs, shared July 6, Ljung explained the staff cuts served as a method of ensuring the company’s path to “long-term, independent success.” To do this, Ljung said, requires “cost cutting, continued growth of our existing advertising and subscription revenue streams, and a relentless focus on our unique competitive advantage — artists and creators.”

On Thursday, the official Audiomack account disputed SoundCloud’s commitment to artists. According to Audiomack, SoundCloud put bankers’ needs over the artists who helped them build an enterprise:

IT’S TIME TO CLEAR THE AIR ABOUT SOUNDCLOUD. THREAD:

— Audiomack (@audiomack) July 13, 2017

We use to work w/ Soundcloud to support our mutual users until they decided cut off the partnership.

— Audiomack (@audiomack) July 13, 2017

We knew by allowing artists to use Soundcloud to create song posts on audiomack that we’d be enabling SC but we still put artists 1st anyway

— Audiomack (@audiomack) July 13, 2017

We offered to pay Soundcloud to allow artists to use their API – so artists can centralize their plays while using our support & reach

— Audiomack (@audiomack) July 13, 2017

They declined our offer. They put their bankers and venture capitalists needs over the artists who helped build their platform.

— Audiomack (@audiomack) July 13, 2017

We respect Soundcloud and what they built, but they lost sight of what’s really important, the artist.

— Audiomack (@audiomack) July 13, 2017

Chance the Rapper chimed in on the latest SoundCloud developments Thursday, telling his nearly 5 million Twitter followers he was working on the issue. He did not provide additional details.