Law Commons^™

Spotify’S Direct Listing: Is It A Recipe For Gatekeeper Failure?, Brent J. Horton

SMU Law Review

On April 3, 2018, Spotify Technology S.A.—a music streaming company valued in excess of $20 billion—went public by direct listing on the New York Stock Exchange (NYSE).A direct listing is distinguishable from the more traditional initial public offering (IPO) in a number of ways, but the most important for purposes of this Article is that it foregoes the traditional underwriter.

First, this Article explains direct listings, why a company would choose to go public by direct listing, and the mechanics of a direct listing.

Second, this Article explains that a direct listing—with its reliance on a financial advisor to shepherd …