The Evolution of Google and SoundCloud: From Unconventional Beginnings to Broken Business Models


Hatched by Glasp

Sep 07, 2023

3 min read


The Evolution of Google and SoundCloud: From Unconventional Beginnings to Broken Business Models

In the world of tech giants and online platforms, two names stand out: Google and SoundCloud. Both companies started with unique visions and innovative ideas that propelled them to success. However, as time went on, they faced challenges that led to significant changes in their business models and relationships with their users.

Google, founded by Larry Page and Sergey Brin, began as a search engine called Backrub. Their goal was to organize the world's information and make it universally accessible and useful. From humble beginnings in their dorm rooms, they built a search engine that revolutionized the way we find information online. In 1998, Google Inc. was officially born with a $100,000 check from Sun co-founder Andy Bechtolsheim.

Right from the start, Google embraced an unconventional approach. Their initial server was made of Lego, and they even took time off work to attend the Burning Man Festival, as announced in their first "Doodle" – a stick figure in the logo. The company's motto, "Don't be evil," embodied their commitment to challenging traditional norms and fostering a culture of innovation.

On the other hand, SoundCloud had a different beginning. It was a platform that allowed artists to share their music and connect with fans. However, the business model that SoundCloud adopted ultimately led to its downfall. Initially, artists abused features such as reposting their own tracks, flooding followers' feeds and diminishing the user experience. SoundCloud tried various business models, including charging creators for premium accounts and implementing content-related ads. But the platform faced a major challenge – much of the audio uploaded contained copyrighted material, leading to takedowns and disputes.

As SoundCloud grew in popularity, bad actors took advantage of the platform. Reposts became a tool for artists and promoters to artificially boost their streams, flooding users' feeds with mediocre music. Services emerged that allowed artists to buy fake listens, likes, and followers, undermining the integrity of the platform. SoundCloud's focus on major labels and licensed tracks discouraged the remix culture that had initially thrived on the site. The smaller, up-and-coming artists who helped build SoundCloud's reputation were left with limited options for monetization and a one-sided relationship with the platform.

In contrast, Google continued to innovate and expand its offerings. It introduced various products and services, including Google Maps, Gmail, and YouTube. The company's commitment to organizing information led to the development of powerful search algorithms and advanced AI technologies. Google's success can be attributed to its ability to adapt to changing user needs and its relentless pursuit of making information accessible.

So, what can we learn from the journeys of Google and SoundCloud? Here are three actionable pieces of advice:

  • 1. Embrace innovation and unconventional methods: Like Google, don't be afraid to challenge traditional norms and think outside the box. Innovation often comes from taking risks and exploring unconventional ideas.
  • 2. Prioritize user experience and community: SoundCloud's downfall was partly due to neglecting the needs of its users and failing to foster a strong sense of community. When building a platform, focus on creating an engaging and supportive environment for users to connect and share.
  • 3. Adapt to changing landscapes: Both Google and SoundCloud faced challenges as the digital landscape evolved. It's crucial to stay agile and adapt your business model to meet the changing needs and expectations of your users.

In conclusion, the stories of Google and SoundCloud highlight the importance of staying true to your mission while adapting to the ever-changing digital landscape. By embracing innovation, prioritizing user experience, and staying agile, companies can navigate challenges and continue to thrive in a competitive market.

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