Spotify has reportedly taken the big step everyone has been waiting for. According to a new report by Axios, the Swedish streaming company has confidentially filed for an IPO with the U.S. Security and Exchange Commission (SEC) at the end of December and plans to file sometime in the first quarter of 2018.
One important thing to note is that they are reportedly seeking to be directly listed, instead of being floated, which comes with its advantages and disadvantages and is outside the norm for tech companies. It is cheaper, faster, comes with no underwriters and they don’t have to issue new shares, diluting stock. It also means that there are no major backers, no deal support from banks and no buffer from volatility, which Spotify is facing plenty of right now.
The Axios report cites multiple sources, though the company has declined to comment.
The timing comes just as a massive $1.6 billion lawsuit from Wixen Music Publishing has been made public. We will see how that impacts the filing, but Spotify has seemed undeterred on their path to an IPO with a valuation reportedly close to $20 billion.