Meet the 34-Year-Old Founder of Spotify, Who Could Be Worth Billions This Year
Depending on who you talk to, Spotify CEO Daniel Ek is either the guy who saved the music industry, or the one who killed it.
Nearly a decade after the 34-year-old launched the hit streaming service, rumored to go public within the next few months, his future stands to be a valuable one.
Private trades have bumped Spotify’s valuation up to as much as $20 billion – if the IPO goes forward, Ek’s stake will be worth $1.6 billion or more, according to Business Insider. In 2017, based on a reported 10% ownership in the company, Ek's net worth hovered around $800 million, according to Billboard. And Spotify's competitive edge will only get stronger.
“As a public company, analysts predict that Spotify’s lead will only grow stronger and will put pressure on Apple and Amazon to dig into their deep war chests,” Fast Company writes.
Ek is notoriously press shy — little is known about the CEO outside of his affinity for business casual attire and, judging by his public Spotify playlists, bubblegum pop — so it's no surprise that he declined Money’s request for an interview.
Analysts from the advisory firm GP Bullhound, which owns shares in Spotify, predict its valuation could reach $55 billion by 2020, which would rocket Ek's fortune to $5.5 billion in just a few years.
Theresa Welbourne, PhD, a professor at the University of Alabama, and lead researcher of a 2017 study on the fate of private companies that go public, says most CEOs sell at least some of their shares at the IPO, and Elk may follow suit.
"Regardless," she says, "my guess is he stands to make a lot of money."
Born in Stockholm, Sweden, the tech entrepreneur started his first business at just 13 years old, building websites for $100 to $200, he told Pando.com. A year later, he was charging $5,000 a site, and by age 18, he'd brought on 25 employees, and was raking in $50,000 per month.
Ek launched Spotify in 2008 for users in Europe, and brought the service to the U.S., with funding from streaming pioneers like Napster’s Sean Parker and μTorrent’s Ludvig Strigeus, in 2011. Spotify co-founder Martin Lorenzton, who stepped down as chairman in 2016 but remains on the board, invested about $6 million early on, and will nab $2 billion from the company's IPO, Business Insider estimates.
Today, Spotify has 150 million active users, and over 50 million subscribers who pay $10 a month for ad-free listening. It’s the world’s largest streaming service by a long shot, and has ushered in a new era of music fandom, where nearly every piece of music in recorded history is accessible, and affordable, to the general public.
Still, as long as it's been around, Spotify has drawn sharp criticism for using a business model some say undercuts artists, and contributes to plummeting sales in an already bruised industry.
Last week, amid reports about Spotify’s impending IPO, the company was slammed with a copyright lawsuit from Wixen Music Publishing, which administers music from Tom Petty, Neil Young, and other artists, seeking $1.6 billion -- ironically (or, perhaps, not), the estimated value of Ek’s share.
“Music is art, and art is important and rare,” Taylor Swift wrote in a 2014 op-ed for the Wall Street Journal, after pulling her entire catalog from the streaming service. “Important, rare things are valuable. Valuable things should be paid for.”
Swift brought her music back to Spotify in 2017, raking in $400,000 off streaming royalties in the very first week). Spotify, it's worth noting, has yet to turn a profit.
Not everyone in the music industry is anti-Spotify, or the man behind it.
When Ek married Sofia Levander in 2016, Bruno Mars performed at their wedding. Writing for TIME’s “100 most influential people” list last year, Ed Sheeran called himself “a fan” of the "tech pioneer."
“I don’t know what the future of music holds, but I bet Daniel’s a big part of it,” Sheeran wrote.
Ek may not talk too much to the media, but he is active on Twitter, often retweeting musicians, sharing Spotify playlists, or offering words of wisdom: