Spotify Co-founders Earn $900 Million as Company’s Value Jumps

Spotify co-founders Daniel Ek and Martin Lorentzon have together earned about $900 million from selling their company stocks this year.

This big profit comes as Spotify’s market value has shot up to nearly $100 billion, a major increase from when it was below $20 billion a few years ago.

Documents filed with the U.S. Securities and Exchange Commission show that senior executives and board members at Spotify sold stocks worth $1.25 billion in total this year. These sales mostly happened in November and December.

Daniel Ek, who is Spotify’s CEO, sold shares worth nearly $350 million, with one of those sales in December bringing in $28 million alone.

Reports now place his net worth over $7 billion. Martin Lorentzon, who sits on Spotify’s board, sold more than $550 million in stock, marking him as one of the richest corporate leaders in the world.

Other top executives at Spotify, like Chief Product Officer Gustav Söderström and Chief Business Officer Alex Norström, also sold large amounts of stock, cashing in $106 million and $63 million, respectively.

The rise in Spotify’s stock price is linked to the company’s new focus on making a profit. After cutting many jobs in 2023 and increasing prices in several countries, Spotify has reported profits every three months throughout 2024.

This success has come without losing any subscribers. Analysts from Bank of America and Morgan Stanley have commended Spotify for greatly improving its profit margins and shifting its focus from just growing to making more money.

This financial turnaround has put Spotify on par with Netflix as a leader in the streaming world, with both companies excelling in what’s known as the “streaming wars.”

The selling of stocks by Spotify insiders was planned in advance, with some sales decided spontaneously, a company spokesperson explained.

These sales are part of a long-term financial plan for executives who mainly get paid in company stock.

Netflix CEO Ted Sarandos, a member of Spotify’s board since 2016, also sold $6 million worth of Spotify shares this year.

As Spotify continues to succeed financially, the large earnings highlight the effective leadership of Ek and Lorentzon, who have guided the company through tough times to significant financial success.