The Agony and Ecstasy of Building an Online Music Business

> “For music streaming start-ups, 70 to 80 percent of revenue, in the best case scenario, goes to rights holders from the word go,” Mulligan said. “If the streaming service is acquiring users but not monetizing them yet because they have free users without a scaled ad business, then those costs still need to be paid even though there is no revenue.”

My understanding was that Soundcloud's core product is delivering more independent and self-created content (Chance the Rapper dropping Acid Rap) vs. allowing a user to find a Kanye West track (Spotify, Apple Music, formerly Tidal).

If that is the case, then why do the Soundclouds of the world have a licensing rights issue at all?