Huffington post CEO seems stoked about Spotify subscriber metrics. Why is that?
Digital Music News is reporting:
“Huffington Post CEO Jared Grusd was General Counsel and Global Head of Corporate Development at Spotify for 4 years. Which means there’s probably a strong connection, and even financial strings like stock options.”
Please read full article here
The bad odor emanating from HuffPo keeps getting stronger. For background, artists rights advocate Blake Morgan posted this mildly critical piece about Spotify on his HuffPo contributor account. Just as it was beginning to go viral HuffPo took the article down. The justification was… shall we say less than convincing? And in the words of Digital Music News “the internet called bullshit.”
Digital Music News hints at another issue by noting that HuffPo CEO Jared Grusd may have “financial strings like stock options.” This is interesting for several reasons.
First Spotify appears to be in its “quiet period” for it’s IPO. Second Spotify is going public through an unusual direct listing. This means that current stock and options holders are essentially making the public offering. Rather than underwriters and banks. I am not a securities law expert, but wouldn’t this make current shareholders selling stock in the direct listing, the parties making “the offering” of stock as defined in SEC regulations? Wouldn’t these parties then be subject to the SEC rules governing what can be said by the parties making the public offering? Further the SEC guidance on public statements during quiet periods (here) has pages of rules on what “related media” can or can’t do when providing information to the public (start on page 133). The question I can’t answer is whether a shareholder “offering stock” actively suppressing information that would otherwise be public violates the letter or spirit of these rules. That’s above my pay grade. But someone out there knows the answer.