Time.news – Conquer 1 billion users, 50 million creators by 2030 and above all reach 100 billion in revenues per year, with a gross margin of 40%. These are the plans of Spotify, a music streaming platform listed on the New York Stock Exchange since 2018, according to CEO and co-founder Daniel Ek. The Swede put the company’s objectives side by side during the second (the first since the listing) Investor Day, the meeting with the investors of the company. To date, Spotify has 422 million users, including 182 million Spotify Premium subscribers, across 183 countries.
For Ek’s plan to happen, Spotify is expected to grow its revenue nearly 10 times its 2021 revenue of $ 11.4 billion. “We are accelerating our growth path to become a platform capable of entertaining, inspiring and educating more than a billion users worldwide and, just as a platform for creators, we will provide the infrastructure and resources that will enable 50 million of artists and creators to grow and better manage their businesses and projects, monetize their work and effectively promote it, “Ek said.
Podcasts and audiobooks
Despite Spotify’s heart beating for music, the platform is looking to broaden the listening experience for users by working on podcasting and audiobook development. Speaking of podcasts, it emerged that a third of Spotify listeners tune in to podcasts (7% of all listening hours on the platform). Spotify chief content officer Dawn Ostroff pointed out that the company has pledged more than $ 1 billion in podcasting and that the company is still in investment mode.
For Ostroff, however, podcasting is a $ 20 billion opportunity. Speaking of which, Ek stressed that these investments (podcasting and audiobooks) are already doing “better than you probably expect”, with gross margins of 28.5%, on track to reach the company’s long-term goal of 30%. -35%.
Ek specifically added that the podcasting business generated around € 200 million last year, a 300% increase from 2020, and more than 125 million users listened to a podcast in the first quarter. The company highlighted the numerical growth of podcasts on its service, noting that Spotify today has over 4 million podcasts, up from 500,000 in 2019.
In addition, its podcast creation tool, Anchor, has contributed to this growth: according to the company, the app powers 75% of podcasts on Spotify, and each new show created on Anchor brings an additional 2.5 million monthly active users to the service. .
Ek expects the podcast business to have the potential to generate margins of between 40% and 50%, and that audiobooks also have margins above 40% (according to Ek they could bring in $ 70 billion in annual revenue). However, he did not specify how long it would take before the company reached those numbers.