Soundcloud confirms new $70M credit line after failing to close $100M round | Hacker News Reader

Soundcloud confirms new $70M credit line after failing to close $100M round

techcrunch.com

32 pointswhatok15 comments

"We are pleased to have secured a flexible $70 million credit line from Ares Capital, Kreos Capital and Davidson Technology that is ideally structured for a company with our strong credit rating and in our stage of growth"..

I don't know how someone defines a strong credit rating, but I wouldn't exactly call Soundcloud a stellar company to lend money to. Unprofitable, anyone?

Credit is the funding of last resort when you can't get equity investors. If Soundcloud goes bankrupt, creditors go to the head of the line to get any leftover assets at liquidation time. Equity holders are last in line, and will almost certainly get nothing.

Credit isn't always the last resort. Many management teams would love to borrow money at even 15% instead of giving up equity with a 2x liquidation preferences or IRR-based ratchet.

> The company has secured a $70 million round of debt (...) which it will use to build out more technology, to hire more people, and to build “a financially sustainable platform.”

Sounds like a bankrupt drunk getting short term loan to drink more and make themselves profitable some magical way.

I use Soundcloud often in my browser (Safari on macOS). For some reason, songs stop occasionally for a short period of time and then continue. I haven’t found the reason. It feels like buffering. It happens even when Soundcloud is the active and only tab in the browser, so it probably is not not the browser throttling JavaScript.

And the website requires ungodly amounts of CPU. When I’m on battery I open iTunes and listen to locally stored music because the Soundcloud website drains my laptop battery.

I don’t understand how they cannot notice these problems. They take in millions and millions of Euro while the streaming is intermittent and the website drains the battery. What are they working on that this can wait?

While we are at it: How about an official Soundcloud app for macOS so I can use the keyboard’s media keys?

I tried Soundcloud Go (it was free the first month). I canceled it after the first two weeks because I did not see any benefit to how I use Soundcloud.

I use the SoundCloud app on my iPhone and its perfect. No buffering issues whatsoever, even when the internet is spotty.

Huh. On my android phone it's practically unusable. Seems like it's a very large app and thus I think it's causing the phone to run out of RAM (or get very close to).

I pay for Soundcloud so I can cache the mixes I follow. If anyone from Soundcloud is following this thread, it's all about the mixes and the caching!!!

They are too far behind Spotify for individual tracks, maybe they could get some exclusive podcasts or something but please for the love of God don't take away the mixes or the caching it's such a huge value add in my life.

Even for sets and mixes I think Mixcloud is way ahead of Soundcloud. Unfortunately I constantly see significantly less engagement for my content over there.

I agree - I only use Soundcloud for listening back to radio shows (Specifically Rinse FM. I figured that since I listen to them so often, I could save money by paying for Soundcloud Go rather than paying more for extra mobile data.

The mobile app needs a lot of work, but the saving songs and offline playback (presumably these were the latest things developed on the app) are the slickest and most refined parts of the app.

What does "caching" mean here?

He means you can save them for offline playback. A 2-hour mix is around 100mb for me. If you're listening to music every day, then it adds up pretty fast.

why not download the mixes and upload them to Google Music? Now you have mixes and caching for free.

"This new funding will enable SoundCloud to strategically grow our technology and personnel resources to fuel our expected 2.5 times year-over-year growth in 2017" - they can't really expect to grow that quickly at this point, can they?

I agree. Not unless growth in the last 12 months was similar and still rising (ie. the growth rate was rising) or the growth rate is high than 2.5x. Yeh, it's bonkers.

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