Spotify to spike
Music streamer Spotify could have a valuation of $20 billion when it goes public, rising to $55 billion by 2020, before reaching $100 billion mark in the long-term, according to a new report. Investment bank GP Bullhound, which has come up with the latest valuation, bases it maths on faster-than-expected subscriber due to greater penetration of emerging markets, along with improved deals with music labels.
"Spotify have introduced family plans and student discounts and if we factor in that emerging markets have a much lower average revenue per premium subscriber we believe that Spotify will see a steady decline in revenue per premium subscriber moving towards 2020 compared to today's value," says GP Bullhound.
The company reported 60 million paid subscribers in mid-2017, as its music platform picked up an impressive 15 million premium customers in the first half. GP Bullhound sees the subs base spiking rapidly to 100 million by mid-2018. By 2020, the total user base may run to 500 million, with 40% of those being premium subscribers.
Spotify is not looking for an IPO but is considering a direct listing on the New York Stock Exchange, enabling private stock to be traded publicly.