Jay-Z's Tidal Sells $297M Majority Stake to Square to Find New Ways to Support Music Artists
Photo Credit: Nicholas Hunt/Getty Images for The Reform Alliance

Jay-Z's Tidal Sells $297M Majority Stake to Square to Find New Ways to Support Music Artists

Jay-Z’s music streaming giant Tidal is joining forces with Jack Dorsey’s financial services company Square in a monumental move that’s innovating the music industry for artists’ benefit.

Billboard broke the news this morning after reporting that Square will be paying $297 million in a mix of cash and stock to acquire a majority stake in the company. In exchange, Jay-Z will join Square’s board of directors while Square’s hardware lead Jesse Dorogusker will serve as the interim head of Tidal once the deal is finalized.

At the close of this deal, artist stakeholders who initially partnered with Jay-Z and Tidal will maintain ownership stakes in the streaming service.

According to a series of tweets from Dorsey, this deal allows both parties to brainstorm new ways to support artists in a time where touring is not able to resume at regular capacity amid the pandemic.

“I knew Tidal was something special as soon as I experienced it, and it will continue to be the best home for music, musicians, and culture,” Dorsey said of the streaming service in a statement to Billboard.

Jay-Z also ended his three-year Twitter hiatus to break the news and share his thoughts on this groundbreaking deal.

According to Billboard, Tidal — which launched six years ago — got off to a rocky start when a handful of the world’s richest artists came forward and said they were being underpaid for their music. The streaming service also landed in some legal trouble over claims of false advertising around exclusive releases to a $3 million dispute between itself and then artist shareholder Kanye West.

The sale is now considered a coup for Jay-Z, who restarted the company back in 2015 after buying Tidal’s Swedish parent company Aspiro for $56 million.

The idea for this joint venture is to regain trust with artists and support them in a way that allows them to benefit from their own work and expand their opportunities.

“I said from the beginning that Tidal was about more than just streaming music, and six years later, it has remained a platform that supports artists at every point in their careers,” Jay-Z said in a statement to Billboard. “Artists deserve better tools to assist them in their creative journey. Jack and I have had many discussions about Tidal’s endless possibilities that have made me even more inspired about its future. This shared vision makes me even more excited to join the Square board. This partnership will be a game-changer for many.”

According to a Billboard interview with Dorogusker, he claims Tidal’s focus will be put on creating new tools to support artists throughout their careers, as well as expanding on Tidal’s growing core music streaming business.

“TIDAL sets a high standard for supporting artists, capturing music culture, and delivering the best audio quality to fans,” he said in a press statement. “Square has also set a high standard for building elegant, accessible, and fair tools for sellers and individuals to economically empower them. Together, TIDAL and Square will be music-obsessed and artist-focused while we explore new artist tools, listener experiences, and access to financial systems that help artists be successful.”

The synergy of this deal between a financial services company and a music streaming giant is an unparalleled move for the music industry that will ultimately change the structure of it as we know it.

A potential new feature behind this deal may include an option for fans to pay their favorite artists directly for content and merchandise through Square’s mobile payment app, Cash App, Billboard reports.

The hope for Square’s acquisition of Tidal is to help quiet any concerns around the music industry and how artists are being paid. Moving forward, both Square and Tidal will work together and focus on improving the streaming service’s payment structure.

For more information about Square and Tidal’s new partnership, click here.

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