Let’s start my in-depth look at Who Owns Spotify?
with some numbers: Spotify has 433 million monthly active users, 188 million of which are paid subscribers. That’s a lot. Most of them are from Europe at 32%, with North America (USA + Canada) coming second with 22%. However, North America does have the highest average daily use. Of all users, 44% use Spotify daily.
Spotify is in the top 10 of most downloaded apps and in the top 10 of the apps with the most monthly active users. It also is one of the most used music streaming services. The music service contains 82 million songs as of 2023, including four million podcast titles. An average of 1.8 million songs are added monthly.
Spotify is very popular, and that’s quite an understatement. Spotify basically changed the way we listen to music – forever.
The Evolution of Listening to Music
A long, long time ago, people bought records because that was the only way they could listen to music at home. There were normally up to five songs on both sides of the record. Therefore, if you wanted to be able to listen to a large number of songs, you needed a very big record collection.
After records came cassettes. These had more music, but you still needed to go to the shop and buy them, but you could also record onto them, so if your friends had a record you wanted, you could increase your collection that way. But regardless, you still needed a lot of cassettes if you wanted to pick from a wide variety of music.
Even later, the CD was introduced. But again, you need to buy a CD to be able to listen to music. The more CDs you bought, the more songs you could choose from. And then something strange happened…
Music became available to download
That didn’t go without challenges. As I will discuss later, illegal downloading and music piracy became big problems. But to be able to download an infinite amount of songs, rather than buying a few, was very attractive for many people. And looking at the number of people that use Spotify, this is still a very popular way of enjoying music.
The Story of Two Guys
Spotify’s story is a very interesting one. It shows that anyone can get very successful with an innovative idea. Two guys from Sweden had such an idea, and in 2006, Spotify was born. Their names are Daniel Ek and Martin Lorentzon.
They had both been interested in innovation and IT since they were young boys. They studied and worked various jobs in this field before they founded Spotify. Daniel founded an advertising service named Advertigo. Martin started a company named TradeDoubler.
When TradeDoubler became successful, Martin took an interest in Advertigo. He saw a good fit with TradeDoublers business model and made Daniel an offer he couldn’t refuse. Daniel indeed agreed, and Daniel’s company Advertigo was bought by Martin. Through this takeover, Daniel and Martin became very good friends. They realized they really enjoyed working together and were a good team, so they were keen to keep their partnership going.
The state of the music industry
In the meantime, due to illegal downloading services and music piracy, the music industry found itself in a bad position. Record companies and artists alike were losing billions of dollars. In the early 2000s, this was a big problem for the whole music industry. Nobody had an answer or a way to solve the problem. Until Martin and Daniel got involved in this dilemma.
The two friends started thinking about alternatives that would end music piracy and illegal downloading. Their hope was that the artist and everyone else involved would get fairly paid for their work. They came up with the idea of a streaming service and were so enthusiastic that they founded Spotify on April 23th, 2006, in Stockholm, Sweden.
Turning a Dream Into Reality
After founding Spotify, Daniel and Martin needed to develop the software to make the streaming service work. This was right up their alley, so quite soon, there was a framework for it.
Now they had to sign contracts with major music labels because, understandably, no one would subscribe without music being available on the streaming service. The poor state of the music industry helped: music labels and artists were keen to try something different in an attempt to again earn money for their work. Because Spotify was and is also available for free, it didn’t take much to convince people to subscribe to the music streaming service.
Fast forward a good couple of years, and it’s one of the biggest music streaming services in the world. Spotify is extremely successful and changes the way we listen to music and, therefore, the music industry. Just because of two guys having an innovative idea for an industry that was in need of a big change.
Who Owns Spotify Now?
Spotify is still primarily owned by its founders, Daniel and Martin. They own respectively 18.5 and 12.1% of the company. Daniel has 33.6% of the voting power; Martin has 43.8%. Daniel is the CEO of Spotify and Martin is a member of the board of directors.
But of course, as Spotify grew, interest in buying into the company grew too. Spotify went internationally quite soon as well. To date, there are various institutional shareholders that make up the firm. One of them is Baillie Gifford. It is an investment company that holds 11.8% of Spotify.
Another shareholder is Tencent Music Entertainment. This is China’s largest music company. It owns 9.1% of Spotify’s shares.
Morgan Stanley is next in line, with 7.3% of the shares. This is a financial service and banking firm. The majority of Morgan Stanley’s shares are held by institutional investors. This makes it hard to say who actually owns these shares.
Sony Music Entertainment (SME) is big in the music industry. In 2015, they announced an alliance with Spotify. SME owns less than 5% of Spotify’s shares, but their alliance is very important for the music that is available on the streaming service.
T Row Price Associates is another big stakeholder, with around 8% of the shares. This also is an investment company.
The shareholders of Spotify can change quite frequently, and therefore, it is hard to determine exactly who owns the shares in Spotify and their percentage. Big institutional shareholders make it even harder to know who is behind the holding.
There are also investment companies, like BlackRock, AMF, etc., that all own a few percent of the shares. These are institutional stakeholders, so the companies, rather than the people behind those companies, own the stocks.
Want to Know Who Owns What?
Interested in knowing more about company ownership, then find out Who Owns Dreamworks, Who Owns ESPN, Who Owns Subaru, Who Owns Hershey, Who Owns Twitter, Who Owns Popeyes, Who Owns Netflix, Who Owns The Jordan Brand, and Who Owns Dr. Pepper in 2023.
Or you may want to know Who Owns Zillow, Who Owns Coca-Cola, Who Owns Fox News, Who Owns Volvo, Who Owns Zelle, Who Owns Cash App, Who Owns Wayfair, as well as Who Owns Mint Mobile, which could well come as a surprise!
Well, in a nutshell, a number of people and institutions own Spotify, but the two founders still own the majority of the stock. This is rather unique for such a big company.
There are a few reasons for this, such as the fact that they both had quite a bit of money behind them when they started Spotify. This means that they didn’t need a lot of investors when they first established the company. Also, they are both very interested and invested in the type of company they established. This means that both Daniel and Martin are passionate about Spotify and what it stands for.
This could also explain why they are still so involved both financially and in the workspace. They are both still actively involved and work at Spotify while they are wealthy enough to never have to work a day in their lives again.
Enjoy listening to Spotify!