Spotify CTO Gustav Söderström: TikTok's Music; How Olivia Rodrigo Gamed the Algo | 20VC #936

Gustav, this is an incredibly challenging show for me to do with, like, a serious face because I know you socially. Uh, I think the world of you socially, and so now I get to put on a professional face and welcome you to 20VC. So thank you so much for joining me today.

Thank you for having me. It's an, it's an honor and likewise.

That is, that is very kind. I've also been stalking the shit out of you for the last few days professionally, uh, and so this has been great fun. But I want to start with a little bit on you, Gustav. So tell me, how did you make your way into the world of startups and then come to lead the product org at, you know, one of the generational defining companies of our time with Spotify?

So I'll try to do the, the brief version of the history of my life. Could be a few hours here, but I'll try to do it in a few minutes.

You've got three to four minutes, so just take your time. (laughs)

(laughs) And then we cut. So I'm, I'm sort of actually this, uh, involuntary entrepreneur. I graduated from the Royal Institute of Technology in Stockholm, sort of, uh, electrical engineering, computer science, and then, uh, that was the tail end of the IT crash, so there were literally no jobs to be had. And so I found a group of friends. I wanted to work at one of these big boring Swedish companies, like Ericsson or something.

(laughs)

But I couldn't get a job, so I decided with a bunch of friends to start a company because all these investments had been made during the IT era in, you know, 3G and smartphones and so forth. It was all there, but no one believed in it. So we started this company where you could send text messages over data instead of SMS. And, and already back then, even though you paid per kilobyte, it was still 1/1000 the cost of sending the same, uh, you know, 160 characters over, over text message. And it turns out that people love cheap communication. So that took off in a, in a little bit in, in, uh, Sweden and in the Nordics. The problem was that the carriers back then controlled the world, and they were selling SMS bundles. They didn't like that. So we ended up selling this company to Yahoo! and... because they had the biggest messenger application in the world, but it was desktop only, and they wanted to go big in, in mobile because mobile was starting to happen here, and they had all these relationships with the global carriers. So I ended up working at Yahoo! in Sunnyvale for, for a bit, and I can tell you it was a troubled company already back then.

(laughs)

So fast-forward about two and a half, three years later, and I think four or five CEOs later, I was back in Stockholm trying to figure out what to do, and through a mutual friend I met, uh, Daniel Ek, the founder and CEO, the co-founder and CEO of Spotify. And he showed me this amazing application because Spotify already existed as an ap- application on desktop, and it was simply amazing. But what he wanted, he wanted someone to head up what Spotify mobile was going to be. Because this was 2008, and the iPhone had just come out, but there was no app store yet, and it didn't really have any market share. So the, the world was mostly, you know, Symbian, Sony Ericsson, these, these things. And so I happened to be... you know, I got lucky. I had a moment in time where I knew something, how to develop for lots of different mobile phones that many other people didn't know. So that's how I came into Spotify, starting to head up, uh, product development for mobile.