“You espouse the rhetoric of supporting the music industry when the reality is that you work for companies funded by investors who want to see an exit on that investment. Your objective is to grow your user base to tell a story… so that you can IPO or you can sell.”
Those were the damning words from Ministry of Sound boss Lohan Presencer to a Deezer executive live on stage in March.
Today, his prediction rung true.
Despite its net losses exceeding €87m ($99.5m) over the past three-and-a-half years (see below), Deezer has confirmed that it will start trading on the Paris stock exchange on October 30.
It expects to raise between €300m and €403m ($345m-$460m) as a result.
The French music streaming company has set a per-share price target for its initial Euronext IPO of between €36.40 and €49.24.
Deezer plans to sell more than 8 million new shares in the business, with its share price due to be set on October 27.
Deezer’s financial health up till now is certainly intriguing.
Not only will is it on course for another hefty net loss in 2015, but in 2013 it paid out 94% of its total €92.8m revenue to the music business as minimum guaranteed advances.
Music Business Worldwide