Last month Deezer announced their plans to IPO but have now postponed it citing “market conditions”.
Deezer announced last month that they were going public with an IPO on the Paris stock exchange. They planned to raise €300m-€400m ($330m-$414m) however the music streaming service has pulled out citing tough market conditions as the reason.
Deezer have said that they will “review its fundraising options in the future” adding that they are “well funded and well positioned as it continues to pursue its growth strategy.” This all comes a week after Pandora’s shares dropped 36% after announcing they had lost 1.3 million active listeners since the second quarter.
The chairman of Deezer’s board, Didier Bench, said that watching investors jump ship from Pandora was one of the things that prompted Deezer to alter their course. Bench also stated that the market’s reaction to Netflix’s third-quarter earnings, in which it was revealed shares had dropped by over 10%, had been a factor in their decision.
Bench said: “It’s better for us to wait a bit. We have money and we continue to grow.”
Deezer is one of the longest running music streaming sites and as such has begun to see difficulties in the ever expanding and overshadowing market of music streaming. In 2014 Deezer made €142m/$163m in revenue but made a loss of €27m/$31m.
Though Deezer have a considerable user base, saying they have 6.3 million customers across 180 countries, a large portion of those users are “bundle subscribers” where they have a Deezer account as part of a blended fee with carriers so Deezer do not receive the regular subscription cost.
With the launch of Deezer’s first TV advertisements in the UK it is clear that Deezer want to start pushing to bring in more users, though whether it will be able to secure itself successfully enough for the future through subscribers, investment or stock sales is yet to be seen.