Square buys majority stake in Tidal to create artist-driven business
Thursday, March 4, 2021 at 10:00PM It might seem like an unusual deal, but fintech company Square wants to invest in the future of streaming service Tidal. Square bought a majority stake in Tidal that's equivalent to US$297 million in cash and stock. It cuts out third-party investors and only keeps artists invested in the company to hold the rest of Tidal's shares.
Tidal's former majority owner and renowned rapper Jay-Z will also join Square's board of directors to help oversee Square's businesses, including Seller and Cash app. Square's head of hardware, Jesse Dorogusker, will become Tidal's interim leader.
Square founder and CEO Jack Dorsey (who is also Twitter's CEO) explains his decision on Twitter. He says the deal hopes to find "new ways" for artists to get paid. And that the two companies can work to build an artist-driven business.
The idea of helping support different kinds of musicians is nice in theory, but Dorsey didn't explain how Square intended to do so.
He said in one of his tweets, "It comes down to a simple idea: finding new ways for artists to support their work." And he wants to replicate what they've done for sellers through Square with artists through Tidal.
But he also said they were going to "start small and focus on the most critical needs fo artists and growing their fanbases."
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