Spotify valued at almost $30 billion in unusual Wall Street debut

Spotify valued at almost $30 billion in unusual Wall Street debut

Apple Inc.'s music-streaming business and Amazon.com Inc.'s are also viewed as competitors to the Stockholm-based Spotify, which officially launched its business in 2008. It generated about $5 billion in revenue past year, up more than 40 percent from 2016, and a $1.5 billion net loss compared to about $664 million in 2016. Spotify's stock initially had a reference price of $132, which was the basis for open bidding.

Spotify will also not be selling any new company shares. Launched in 2008, the company claims to have almost 160 million monthly active users, across dozens of countries.

Spotify warned last week that its sales growth was likely to slow this year, but that it still expected to post a narrower annual loss.

The public listing came after more than three hours of discussion among traders who struggled to set a price of the company: according to reports, it's the latest open for a NYSE-listed stock ever, beating out retail giant Alibaba which began trading just before noon in 2014.

A $10,000 investment in Netflix's 2002 initial public stock offering would now be worth more than $2.6 million, leaving some investors wondering if Spotify might be on a similar trajectory in music streaming.

Tomorrow, Spotify becomes a listed public company on the New York Stock Exchange. A direct listing eliminates those restrictions and allows them to potentially profit from the IPO immediately.

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By comparison, Apple's almost 3-year-old music streaming service has 38 million subscribers.

2012, at the Pre-Grammy Gala & Salute to Industry Icons with Clive Davis honoring Richard Branson, in Beverly Hills, Calif. Spotify stock debuted on the market with a boom, opening at $165.90 in an unusual "direct listing".

Its Wall Street debut has been closely followed in recent weeks as much for the unconventional approach to a public offering it chose as for the company itself. But until then let's step back and admire this whole thing for the zeitgeist-ian work of art that it really is; Spotify is about to unleash the first authentically Millennial IPO.

"It's an untested process", said Matt Kennedy, IPO market strategist for Renaissance Capital LLC, an investment research firm. "Most companies do fall after their IPO, but the difference is that there is no underwriter to stabilize the price", he said. Instead, current shareholders were able to sell their existing shares, and were not restricted on when they could do so. The stock market has also been volatile recently with the Dow Jones industrial average falling more than 450 points, or almost 2 percent, Monday.

In lieu of a traditional initial public offering, Spotify used what's known as a direct offering - something it described as a "novel method" for going public.

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