When Grooveshark’s co-founder and CEO Sam Tarantino talks about what happened to his music startup between 2011 and early 2012, he doesn’t hold back: It was, he says, “a year of getting punched in the face 10,000 times.”
During that period, the music streaming service was essentially hit with back-to-back-to-back blows. Google pulled Grooveshark’s mobile app in early 2011, after Apple had done the same the previous year, effectively snuffing out its potential on mobile. Spotify launched in the U.S. in July, 2011 with the blessing of the major record labels and started stealing away Grooveshark’s users. And then came the knockout blow: Universal Music Group filed a federal lawsuit against Tarantino and his employees for uploading copyrighted songs. Sony Music and Warner Music Group joined the lawsuit the following month and EMI filed a lawsuit of its own in early January, meaning that all four major record labels were simultaneously suing the company.
Grooveshark, which had been considered one of the most promising music startups in the late 2000s, suddenly saw its monthly user numbers crash from around 30 million to 12 million in early 2012, according to Tarantino. With the lawsuits looming, he had little choice but to start laying off employees and closing up offices. Grooveshark’s staff was more than halved from 145 to around 60 at its lowest point, with some let go and others choosing to leave on their own.
“Luck comes around in two ways: It comes in bad luck and it comes in spurts of good luck. It amazes me how in early 2012 it poured bad luck.”
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