![]() ![]() Today, artists can produce and release their own music. They needed access to a recording studio, and they had to be played on terrestrial radio to achieve success. In it, he comments: “The old model favored certain gatekeepers. ![]() Within Spotify’s filing is an extensive letter from Ek (CEO and Chairman of Spotify) addressed to would-be shareholders in the company and entitled ‘Our Path’. Maybe it helps that he’s good with words. Because, as the filing reveals, ‘our board of directors determined to pay Mr. Ek the full $1,000,000 bonus based on the Company’s 2017 performance though certain performance goals were not achieved’. Unfortunately for Ek, he got two out of three: Premium subs reached 71m and MAUs reached 159m, but Spotify’s annual gross margin stood at just under 21% (€4.09bn revenue €849m gross profit). The first of these bonuses was worth a cool $1m in cash, so long as Spotify surpassed three annual milestones at the end of last year: (i) More than 70m premium subscribers (ii) More than 150m monthly active users (MAUs) and (iii) An annual gross margin of 25%. Instead of a wage, Ek (who currently owns just under 24% of ordinary shares in his $19bn-valued company) gets paid on a bonus scheme, which sets him certain targets pertaining to Spotify’s growth.
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