Spotify shares magnetize all ages, not just Millennial
New York (Reuters) : The buzzy debut of Spotify Technology on the New York Stock Exchange on Tuesday drew retail investors across generations, not just the Millennials who make up the largest proportion of the music streaming service’s customer base, retail brokerages said on Wednesday.
The music-streaming company thundered onto public markets Tuesday with an opening stock price of $165.90, well above where its shares had been valued in private markets. But the stock has mostly been on a slow grind lower since then, falling as much as 9% on Wednesday before paring losses to close 3.2% lower at $144.22.
Social media platform Snap’s high-profile IPO last year had been notable for being popular with millennials, the primary user base for the company’s mobile app Snapchat. But though millennials are also a key demographic for Spotify, the Swedish company’s listing did not draw disproportionate interest from that generation.
Spotify will continue to use its ad-supported free product to upsell premium (paid) subscribers. Spotify has 157 million monthly active users, of which 71 million are paid subscribers (up from 48 million at year-end 2016), across 65 international markets as of year-end 2017.
Spotify aims to differentiate its service by delivering users a high-value personalized experience, based on its vast collection of user data.
Individual investors who spoke with Reuters similarly expressed reservations about buying Spotify shares.
“I think a lot of similarly situated retail investors still view many of the VC-backed, marketplace tech companies as destined IPO flops,” said Layla Tabatabaie, an entrepreneur and advisor to tech startups who lives in New York.
“There’s good interest in it,” said J.J. Kinahan, TD Ameritrade’s chief market strategist, who is based in Chicago. “It’s pretty well split across age groups.”
Retail investor behavior indicated some caution about jumping in.