00:00Today on Forbes, why Spotify CEO Daniel Ek is stepping down after nearly two decades.
00:08Daniel Ek is stepping down as CEO of Spotify, the streaming company he co-founded in 2006,
00:14and moving to executive chairman. In his place, Spotify's current presidents Alex Nordstrom
00:20and Gustav Sergerstrom will be elevated to co-CEOs. The transition will take place on
00:27January 1, 2026. The 42-year-old Ek says, quote, I've spent 20 years, nearly my entire adult life,
00:35as Spotify's CEO. I'm ready to go from a player to a coach.
00:41Spotify has been quietly working on the transition for years. In 2023, Ek promoted Nordstrom and
00:48Sergerstrom to the roles of co-presidents to expand their power and provide them with more
00:52leadership experience. Nordstrom and Sergerstrom each worked at several startups before joining
00:59Spotify more than a decade ago. Nordstrom has historically handled business, marketing,
01:05and content. Sergerstrom, a trained engineer, has focused on the technology and product side of
01:11the streamer. Ek, meanwhile, will assume the new role of executive chairman and says he'll work
01:16on long-term strategy and key investments. Ek is leaving Spotify's CEO role on a high note.
01:24Over the last year, Spotify shares have surged 100%, compared to the S&P 500's 16% gain.
01:32Its market cap tops $150 billion, with the stock hovering around its all-time peak.
01:38As shares climb, so does Ek's personal fortune. Forbes estimates that Ek, a college dropout from the
01:44rough Stockholm neighborhood of Ragved, now has a net worth of $10.3 billion.
01:51Today, Spotify offers around 100 million songs to nearly 700 million active users,
01:58276 million of whom are paying subscribers. In 2024, Spotify's revenue topped $18.36 billion.
02:08Spotify's growth has helped revive a flatlining music industry, which was once plagued by illegal
02:13piracy. In 2011, the same year Spotify debuted in U.S. markets, the music recording industry's
02:20revenue was around $15 billion, 40% less than the $24 billion in sales it logged 10 years earlier.
02:28Fast forward to 2025, thanks to streamers like Spotify, annual recording sales are near $30 billion,
02:35with streaming accounting for $20 billion of the total. Spotify pays 70% of its revenue to musicians
02:42and rights holders. In 2024, it paid out $10 billion. The soon-to-be CEOs, Nordstrom and Sergerstrom,
02:52aim to further grow Spotify's user and revenue numbers, with a special focus on expanding into
02:57the emerging tech markets across Africa and Asia. Nordstrom says,
03:03We have now hit 3% of the world's population subscribing to Spotify. It's not so unimaginable
03:09to think that we could have 10%, 15% of the world's population subscribing to Spotify.
03:16Meanwhile, tech chief Gustav Sergerstrom is betting AI will create significant change and opportunity
03:22in how people consume music. He says, quote,
03:26It's similar to the shift to smartphones. User interactions will change and means there are
03:31new distribution opportunities, maybe even new form factors.
03:36Ek's move to exit the CEO role comes as he is increasingly looking beyond the music industry.
03:42In 2021, Ek, with Shaquille Kahn, an early Spotify investor and longtime confidant,
03:47launched a $1 billion investment holding company called Prima Materia to invest in high-risk,
03:53high-reward technology out of Europe. Ek says, quote,
03:57It's a company that builds companies. We are trying to do things traditional VCs aren't set up to do,
04:03industries where investors can't go or where the timeline doesn't make sense.
04:08One of the first long-term bets was Neko, a health screening startup Ek launched via Prima Materia
04:14in 2018. The Neko team spent seven years creating hardware that could quickly test for skin cancer
04:20and heart disease before bringing the product to market. In January 2025, Neko raised a $260 million
04:29Series B round from venture capitalists including Lightspeed, General Catalyst,
04:34Lake Star, and Atomico. With a $1.8 billion post-money valuation, the deal made Neko
04:42Ek's second unicorn startup. Ek is also investing in defense technology. Today, he serves as chairman
04:49of German startup Helsing, which began as a software company using artificial intelligence
04:54to analyze military and battlefield data. It has since evolved into a hardware company,
05:00developing AI-powered military drones and submarines. Think the European Anderil.
05:05In July 2025, Ek's Prima Materia led a €600 million investment round in the startup.
05:14The investment has caused a small minority of artists to threaten to pull their music from
05:18Spotify. Few have. For full coverage, check out Stephen Bertoni's piece on Forbes.com.
05:27This is Kieran Meadows from Forbes. Thanks for tuning in.
05:35I want to see you soon.
05:41I like to see you soon.
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