Spotify’s opening number seemed to be music to the market’s ears…at least at first.
The streaming company made its debut on the New York Stock Exchange Tuesday afternoon at more than $165 a pop, pegging its valuation at roughly $29.5 billion.
Over the course of the day, though, that price slipped to about $149, down about 12 percent from the highs of the day, but still well above the $132 a share reference price.
Spotify’s unconventional choice of a direct listing, instead of a traditional IPO, had investors and experts bracing for a roller-coaster ride on Tuesday.
“I thought we were going to see a lot of spikes up and down and up and down,” said Dan Primack, business reporter at Axios. But “it hasn’t been all over the place.”
This smoother-than-expected listing raises the question of whether more companies will follow in Spotify’s footsteps in the future.
“It’s not the right path for all,” Stacey Cunningham, COO of the New York Stock Exchange, told Cheddar before the stock started trading. “There are some unique factors for [Spotify].
“They don’t need to raise capital, so going through the IPO process isn’t something that was important to them.”
Spotify was much more interested in “providing that liquidity event for their shareholders...to have a currency...to do additional M&A deals going forward,” explained Cunningham.
So what’s in store for Spotify’s future?
Fam Mirza, one of the company’s earlier investors, told Cheddar he wouldn’t sell his shares in the listing, because he has faith in where the company is headed.
“They’re so amazing at entering new markets...They can still scale it, and then they get to those bottom line revenues.”
Mirza also doesn’t consider Apple, even as it gains ground in the space, as a real threat. After all, he pointed out, the tech giant has had plenty of opportunity to overtake it.
“Everybody has an iPhone. So as soon as Apple launched Apple Music...why hasn’t every single person who has an iPhone signed on to Apple Music?”
For the full interview, [click here](https://cheddar.com/videos/spotifys-unique-relationship-with-wall-street).
General Electric, the once mighty conglomerate that traces its roots back to the invention of the light bulb, delivered a hugely disappointing earnings report Tuesday morning, in which the company that was once known for its steady and generous payouts to investors slashed its quarterly dividend to just a penny.
Brad Twohig, partner at Lightspeed Venture Partners, said that Fortnite has built itself into a kind of social network and that the community its developed will likely help the game maintain its popularity for some time to come.
Facebook doesn't report its latest earnings until Tuesday, but some analysts are already predicting a drop in the numbers amid security concerns and waning popularity among the platform's younger users. Chris Versace, chief investment officer at Tematica Research, predicted on Cheddar Monday that its quarterly earnings report will put Facebook ($FB) at $1.47 per share, down from $1.59 last year.
Hershey's ($HSY) has unveiled a deal to promote its latest candy creation, a combination Hershey-Reese's bar, with the help of two of esports' biggest names: DrLupo and Ninja. Cheddar was at TwitchCon in San Jose, Calif. and got an early look at Hershey's first foray into esports and live-streaming from the company's head of integrated media, Charlie Chappell.
In a tacit admission that its cloud-computing division was lagging behind competitors like Amazon and Microsoft, IBM announced it would shell out $34 billion for open-source software maker Red Hat for an amount equal to almost a third of IBM's market cap.
These are the headlines you Need 2 Know.
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