![]() The most important obstacle for Daniel and the content team was to secure licensing rights to stream a complete catalogue. One of them was former Facebook President Sean Parker. ![]() The best talent was attracted to Spotify like bees to honey and the buzz wasn’t constrained to the environs of Stockholm - no there were brilliant minds in London, New York, LA and San Francisco that knew about this crazy cool app and had secured a much coveted private beta invite. The music industry was a virtual minefield.īut there was something entirely different going on at the tiny offices at Riddargatan than anything we as venture capitalists had seen before in Sweden. But, I had already lost several millions in failed prior music technology investments and the ongoing lawsuit against Niklas Zennström for his file sharing app Kazaa and the threats to imprison the entire Pirate Bay founder team clearly gave reason to pause. When Daniel and Martin presented their demo of Spotify in early 2007, I was totally blown away. Daniel, meanwhile, and still in high school, moonlighted as part time CTO at Scandinavian auction site Tradera, a company I once served on its Board of Directors. Martin worked in one of my earlier internet investments that ultimately failed, only to found his first big success, Tradedoubler, in our offices during off-hours with his co-founder Felix Hagnö. I have known the Spotify co-founders Martin Lorentzon and Daniel Ek since the last dotcom boom. “Martin, you’ve got to be kidding me, right?” “No” “So you are asking me to invest 20% more money at a 20% higher valuation than we’ve been discussing over the past 6 months? “Yes” Something special You know, the Dollar has lost so much value over the past few months and I think it would be a too low valuation”. “Could you send over the new share count?” “No, I want the price and round size to be in Euros, not Dollar. “.and could we just change the price to Euro?” Martin Lorentzon asked almost in passing in our telephone call as we were about to conclude the final negotiations of the A-round. Success is often hard fought, and the journey with Spotify has been a privilege and a roller coaster. As the company prepares for its listing, I look back at the decade of close work with Daniel and Martin, from the early days in 2007, and leading the first financing round in 2008. Spotify’s success story is both brilliant and hard-won.
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