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It’s do or die for SoundCloud: the company’s future will be determined by vote today

The fate of SoundCloud has been the subject of much discussion as of late.

Recently we reported the streaming platform was considering selling for significantly less than it was said to be worth 12 months previously.  And, just a few weeks back,  group of volunteer archivists started backing up the whole of SoundCloud in case it all of the sudden vanished – along with 1 million GB worth of music.

Now, Axios reports that the company is calling for shareholders to consider a hail mary investment plan to save itself before the end of today, Friday the 11th of August.

soundcloud vote

SoundCloud is allegedly calling on its investors to vote on a new investment plan that would help ensure the company’s future.

According to the publication:

“Axios has obtained a circular sent to existing shareholders on Tuesday, which requires them to accept or reject a reorganization proposal by the end of Friday. If accepted, then the new investment — $169.5 million at a $150 million pre-money enterprise valuation — also closes tomorrow.

If rejected, then CEO Alexander Ljung suggests the company would not be able ‘to continue as a going concern’.”

If the proposal were to be accepted, the company’s main investment would come from Raine Group and Temasek. Return backers would include Union Square Ventures, Doughty Hanson and Atlantic Technology.

As noted by Fader, under the terms of the proposal Raine Group and Temasek would get preferential treatment in recovering funds in the case of liquidation.

“Financing of this size will enable to Company to pay off its remaining debt,” says the Axios report, “while ensuring a strong, independent future.

In the event that the transaction does not close and in the event SoundCloud does not otherwise obtain additional funding, based on current cashflow forecasts, SoundCloud faces liquidity concerns in the near term.”

[via Axios]