Swedish streaming music service Spotify may not be Swedish for long; The company’s two founders, Daniel Ek and Martin Lorentzon, say they might ditch their home shores for more friendly territory if a series of demands to their government aren’t met.
The pair recently posted an open letter on Medium, stating that the company is looking to hire thousands of employees in the coming years, but that limitations on housing, education, and the inability to grant employees stock options are limiting their growth in their home country and forcing the company to consider its options.
“We love Sweden and believe that this is basically the best environment for us. But at the same time, we cannot magically remove the political obstacles,” they said in their joint statement. “Thousands of Spotify jobs could go to the U.S. instead of Sweden.”
All three of the issues brought up by Ek and Lorentzon are definite problems for any tech company in Sweden planning to grow in the coming years. But these issues are extremely troublesome for a company of Spotify’s size, especially when one considers the terms of the recent $1 billion cash influx it received from taking on convertible debt, which would suggest the company will soon go public.
Affordable housing in Stockholm is virtually impossible to find at the moment, with some waiting up to a decade to find an apartment to rent. The founders’ concerns about Sweden’s education system stem from the fact that students are required to learn a handicraft, but not how to code — meaning that they have to import many employees. And taxes on stock options are higher than in other developed countries with major industries, such as the U.S. and Germany, making it harder to lure top talent in the first place.
It may seem drastic to base such a big decision on these issues, but if rules don’t change in the country, it seems reasonable Spotify would consider its options.
Currently, Spotify operates its global headquarters in Stockholm, with about 850 employees in their main office, and many more in their 30 offices around the world. The company is also incorporated in tax-friendly Luxembourg.
“Success requires that you are constantly changing and act instantly. Those who do not get overtaken,” the founders wrote, saying that their concerns, “require urgent action, otherwise Stockholm and Sweden lose in global competition.”
- Apple Music vs. Spotify: Which service is the streaming king?
- Is Spotify too big to fail? It just went public, so we’ll find out soon
- DT Daily: Having never made a profit, Spotify goes IPO, rakes in billions
- Apple Music is growing fast, but it will be a while before world domination
- I ditched Spotify for YouTube Red with Google Play Music and never looked back