Chapter 324 Daniel: A local tycoon has arrived in Asia! The miserable situation of Spotify!

Three days later, at 19 Kingsgate, Stockholm, the capital of Sweden.

An all-black Volvo XC90 turned from the main road into Spotify's headquarters building.

This is a 12-story office building. The overall design is based on Nordic simplicity and incorporates modern design concepts.

It looks a bit shabby, which seems inconsistent with Spotify's market position in European and American music apps.

Daniel Ek wore a blue haute couture suit with a white shirt underneath and a royal blue tie. His suit was neatly tailored and he looked very formal.

In October in Stockholm, the daytime temperature was only 8 degrees Celsius. He wanted to put on a woolen windbreaker, but in order to maintain his decency, he gritted his teeth and stood downstairs waiting.

“Boss, the other party is just a Chinese. Although the Alexa smart speaker has brought 3 million paying users to the company, I don’t think it’s worth giving him such a courtesy.

Microsoft, Google and Amazon are all developing similar smart speaker products, and we should focus on communication and cooperation on other terminal products.”

Martin, the co-founder of Spotify, curled his lips, puzzled by Daniel's performance.

In his opinion, the success of Alexa smart speaker is just a head start. Once Microsoft, Google and Amazon make their efforts, Orange Technology's R&D strength will have no advantage over these European and American scientific research giants.

"Martin, I hope you can immediately put aside your contempt for Orange Technology. Chen Yansen's business talent is no less than that of Facebook CEO Zuckerberg. If it weren't for the different environment, Chen Yansen's business achievements would have surpassed Zuckerberg long ago."

Hearing this, Daniel's expression immediately became solemn, and he warned in a serious tone.

"I know that Orange Technology's valuation is over 20 billion U.S. dollars, but that's just a valuation. Facebook has already gone public, and Zuckerberg's stake is worth as much as 30 billion U.S. dollars."

Martin shook his head in disapproval.

"You have too little information! Chen Yansen also owns a courier company with an average daily volume of over 10 million parcels and an e-commerce company with annual sales of over 200 billion. In terms of comprehensive strength, Zuckerberg is far inferior to Chen Yansen."

Daniel shrugged and chuckled.

The average daily parcel volume exceeds 10 million parcels?

Martin was slightly stunned. He only investigated the information of Orange Technology but ignored the other holding subsidiaries of Senlian Capital.

You know, the total population of Sweden is less than 10 million! However, the other party's express delivery company can provide logistics services to more than 10 million people every day. Although he does not know how to calculate the valuation of the logistics industry, based on the annual express delivery volume of more than 3 billion parcels, its valuation will not be less than 20 billion US dollars.

Therefore, he had to admit that he did underestimate the other party's financial resources and influence in the East.

Just then, a Volvo XC90 drove into everyone's sight and then stopped in the open space in front of the gate.

With a click, the car door opened!

Chen Yansen walked down. Today he was wearing a light gray suit which was extremely tight fitting. With his 1.86-meter tall figure, he seemed a few centimeters taller than Daniel Ek and others.

Song Yuncheng followed closely behind, wearing a velvet business suit, and participated in the meeting as an assistant.

"Welcome, Mr. Chen!" Without waiting for Chen Yansen to come closer, Daniel took the initiative to greet him with a group of Spotify executives.

In terms of wealth and status, he is completely incomparable to Chen Yansen.

Eight months ago, Spotify received US$40 million in financing from JPMorgan Chase, with a post-investment valuation of US$1.5 billion, easily becoming a unicorn company.

However, Chen Yansen's Orange Technology received US$1.35 billion in financing from DST Capital a year ago, with a valuation of up to US$9 billion.

Now, a year has passed, and Orange Technology has become China's leading mobile phone manufacturer, with a valuation most likely above 20 billion US dollars.

What's more, Orange Technology is just one of the other party's many holding subsidiaries.

Daniel considers himself a genius in the business field, but when compared with Chen Yansen, the sense of accomplishment he felt in founding Spotify suddenly vanished.

Therefore, he kept a low profile.

"Mr. Daniel, nice to meet you! Thank you for your contribution to the Alexa smart speaker application ecosystem."

Chen Yansen stretched out a hand and responded with a smile.

In his eyes, Spotify at that time was no different from Kuwo, Tiantian and Kugou Music in China, with a valuation of only 2.5 to 3 billion US dollars at most.

Six years later, Spotify, which rang the bell on the New York Stock Exchange and had a market value of over 26 billion US dollars, was worthy of his second look.

Daniel quickly shook Chen Yansen's right hand and said with a smile: "Mr. Chen, you are too polite. Orange Technology is also an important partner of Spotify."

The two sides exchanged a few words while standing outside, and then Daniel led Chen Yansen and Song Yuncheng into Spotify's headquarters building.

Everyone took the elevator to the rooftop terrace.

Standing here, you can overlook the entire city and coastal scenery of Stockholm.

"Please take a seat, Mr. Chen!" Daniel greeted him warmly.

In 2012, Spotify was in a period of rapid growth, with its main operating areas in Europe and the United States such as Germany, Australia, Ireland and Lighthouse. It also tried to cooperate with Penguin Music and prepared to expand into the Chinese and even Asian markets.

Last year's revenue was US$240 million, and this year's revenue from Q1 to Q3 was US$690 million, with significant revenue growth.

But what worries Daniel is that in order to obtain the right to use the 15 million songs in total from record companies such as Universal, Sony, and Warner, Spotify has to pay a huge amount of copyright fees every year.

It even accounts for 50% of the revenue!

The more users, the greater the loss! Although Chen Yansen has no listed company under his name, his opponent, Senlian Capital, also has strong financial strength.

To put it bluntly, Daniel wanted to take the opportunity to find financing opportunities from the Asian businessmen in front of him and obtain a generous amount of development funds.

In the past three months, he has also been in contact with Goldman Sachs, but the other party was only willing to offer an insulting offer of 2.4 billion US dollars, which Daniel naturally refused.

But there were only three months left in 2012. If he couldn't get more financing, he wouldn't be able to pay even the copyright fees, let alone place advertisements and develop new users.

“I heard that Apple is negotiating with record companies and plans to increase the number of music libraries on iTunes.”

The latest novel is published first on Liu9shuba!

Chen Yansen said casually after sitting down.

Daniel felt nervous after hearing this. Apple's smartphone shipments in Europe and the United States are second only to Samsung. Relying on its terminal advantage, iTunes poses a huge threat to Spotify.

This is why he values ​​Orange Technology so much! Alexa smart speaker is just one of the reasons. Orange Technology's move into the Eastern European mobile phone market gave him a glimmer of opportunity.

If Spotify can reach a strategic cooperation with Orange Phone and pre-install the software on the phone, it will be able to achieve the effect of acquiring customers at a low cost.

After all, Facebook's advertising costs were too high, and coupled with the pressure of copyright fees, it was really too much for him to bear.

"The music library of iTunes is far inferior to that of Spotify. In order to improve the user experience, I have signed copyright licensing agreements with Universal, Sony, Warner and other record companies. The total music library exceeds 20 million songs. Mr. Chen, Spotify is the best choice for Orange Technology."

Daniel hurried to explain.

Fearing that Chen Yansen would abandon Spotify, he replaced the music service provider of the Alexa smart speaker with iTunes.

"Really?" Chen Yansen asked back without comment.

"Mr. Chen, what do you think of Spotify as a product?" Daniel laughed dryly, touched his nose, and changed the subject.

how?

Chen Yansen narrowed his eyes slightly, pondering the meaning of the other party's words, only to see Daniel's eager look and a flattering smile on his face. Could it be that he was treating me as a sucker and wanted to raise funds from me?

In just a few breaths, his mind raced through the matter and he listed more than a dozen possibilities, but the probability of financing was the highest.

"Mr. Daniel, do you want me to tell the truth?"

Chen Yansen replied with a chuckle.

"Of course." Daniel sat upright, intending to listen to the business genius's views on Spotify's business model.

"Copyright costs are high, profit models are unclear, user growth is slow, and payment conversion rates are low..."

Chen Yansen was not polite at all and pointed out Spotify's problems one by one.

The smile on Daniel's face gradually disappeared, his facial muscles stiffened, and he couldn't help but reveal an embarrassed look.

He knows all the problems that Chen Yansen mentioned.

Goldman Sachs' investors also used similar reasons to force Spotify's valuation down to US$2.4 billion.

But it is precisely because it is the truth that it touches people's hearts.

Daniel didn't expect that Chen Yansen's words were so honest and straightforward.

Seeing that the other person's face was becoming increasingly ugly, Chen Yansen restrained himself a little and stopped the topic.

"Mr. Chen, I'm thinking of ways to improve the problem you mentioned. I want to know, in your opinion, does Spotify have investment potential?"

Daniel took a deep breath and asked bluntly.

(End of this chapter)