Spotify CEO Daniel Ek on Tuesday spoke about his company’s origins and its sometimes rocky relationships with artists during a TV interview in the morning ahead of the firm’s unusual direct listing on the New York Stock Exchange.
Ek said that the idea for Spotify came from his own modest upbringing in Sweden.
“For me, as someone growing up in a working-class suburb in Stockholm, I couldn’t afford all the music,” Ek said on CBS This Morning. “So back in ’98, ’99, I was really thinking about how I could get all the music and do it in a legal way while at the same time compensating the artist.”
Spotify was founded in 2006, when Ek was just 23, and officially launched in 2008. Ten years later, Ek says Spotify is just getting started. Ek, known for his laid-back managerial style, also said he’s purposefully trying to be less flashy about his company’s IPO than what’s typical — the company isn’t even ringing the NYSE opening bell, a tradition for leaders at top firms on their first day of public trading.
“While this is obviously a big day and I’m really proud of my employees, I really just feel like we’re in the early days, not celebrating the end days like so many other companies are doing,” Ek said about the company’s upcoming NYSE listing. “We’re now a decade into that journey. And I really just feel like we’re in the second inning.”
Spotify’s upcoming direct listing differs from normal Initial Public Offerings (IPOs) in several notable ways: The company won’t raise any money in the process, and is not working with underwriting banks in the traditional sense. If successful, the strategy could be replicated by other up-and-coming tech startups looking for an alternative to the typical IPO process.
Still, Spotify’s journey has not always been a smooth one. The streaming service has been hit with copyright infringement lawsuits, including one for $150 million in 2015 and another for $1.6 billion earlier this year. Spotify has also faced backlash from the artists featured on its service over compensation — most notably from Taylor Swift, who took her entire music catalogue off the service before reaching an agreement with Spotify and making her music available once again last year.
“For me, first off, I should have done a much better job communicating this, so I take full ownership for doing that,” Ek said about Spotify’s public falling out with Swift. “I went to Nashville many, many times and talked to her team. Spent more time directly explaining the model and why streaming mattered. And the great news is I think she saw how streaming was growing. I think she saw the fans were asking for it. So eventually when the new album came up, she came to Stockholm and spent some time with our team there figuring out a way that made sense for her.”