- Spotify is preparing to become a public company.
- This will be very good for a number of Spotify executives and investors who own a lot of shares.
- Here’s a list of the biggest shareholders in Spotify who stand to get rich (or get richer) if the stock does well.
Global music streaming service Spotify just filed the paperwork to list its shares for sale to the public using an unusual method called a direct listing. Should its stock fare well, Spotify’s founders, executives and major investors should do quite well.
We don’t know yet how much money Spotify hopes its shares to sell at, so we don’t know how many millions Spotify will bring each of these people or investment firms. Spotify will price its shares closer to its first day of trading.
But we do know who owns a lot of shares and who stands to get a windfall, thanks to its IPO documents filed with the SEC.
Here are the biggest potential winners from the Spotify IPO:
Daniel Ek, 35, is the company’s co-founder CEO and the face of Spotify. He currently controls 25% of the company with the voting rights to nearly 47 million shares. He doesn’t own all of those shares directly: 25.5 million of them are owned by his investment company. He still has a massive direct stake over 16 million shares.
Wealth is nothing new to Ek. He’s been a self-made millionaire for over a decade now after selling his first company, ad tech startup Advertigo, at age 23 for $US1.25 million.
After that sale, he bought fancy cars, wooed women and wound up feeling empty and depressed he later admitted.
That’s when he started thinking about doing something next with his life, had long talks with Swedish businessman Martin Lorentzon where they envisioned creating a way to allow people to have better access to all of the world’s music. And here we are at Spotify’s IPO.
Martin Lorentzon, 48, co-founder and director and former chairman, is the next biggest shareholder. He owns 13% of the company, just under 24 million shares.
Lorentzon’s first partnership with Ek was when the ad network company he founded, Tradedoubler acquired Ek’s company Advertigo in 2006 and made the young Ek a millionaire.
Investor Sony Music Entertainment International owns over 10 million shares. Its investment deal, and the royalties it made from sharing its huge catalogue of music with Spotify, was the source of some dispute. 19 artists including Kelly Clarkson and Carrie Underwood sued Sony over it, alleging they weren’t getting their fair share of money Spotify was paying Sony. As Spotify prepped for its IPO,Sony settled that suit in January.
Investor Technology Crossover Ventures(TCV) owns 9.5 million shares, overseen by TCV partner and Spotify board member Christopher “Woody” Marshall. Marshall has a huge roster of successful investments under his belt, including Netflix, Airbnb, Twilio, Dollar Shave Club, others.
Investor Tiger Global owns 12.2 million shares. Tiger is one of the world’s largest hedge funds, founded by Chase Coleman, an early investor in Facebook and a power player in tech and finance.
Investor Tencent, owns about 13.4 million shares. Tencent is the Chinese internet giant, run by its billionaire, engineer founder CEO Pony Ma. He is one of China’s wealthiest people.
CFO Barry McCarthy owns 142,680 shares, and has upcoming options to purchase about another 1.5 million shares. McCarthy is the former CFO of Netflix.
Shishir Mehrotra, 38, owns 99,560 shares. Mehrotra is a board member and former YouTube executive. In April he was granted $US2.6 million worth of shares for his time as an employee at Spotify, too.
There are a number of other well-known people who will also benefit with Spotify’s IPO because they are serving on Spotify’s board. This includes Padmasree Warrior, former star engineer at Cisco and current CEO of NIO US (a Chinese electric car company); Nike exec Heidi O’Neill and Netflix exec Ted Sarandos.