Square, the mobile payments company run by Twitter co-founder Jack Dorsey, has acquired a majority stake in Jay-Z’s Tidal audio and video music streaming service in a $ 297 million deal.
According to the terms of the agreement, Tidal’s superstars co-owners, which include Beyoncé, Madonna and Rihanna, will retain their holdings and become the second largest shareholders. Jay-Z will join Square’s board of directors.
It is the second deal in a few weeks for the rapper, after he sold half of his champagne company Armand de Brignac, better known as Ace of Spades, to LVMH, the luxury goods company. Although the terms of the deal were not disclosed, the brand was valued at $ 630 million by Forbes.
“Why would a music streaming company and a financial services company join forces?!,” Dorsey posted on Twitter, asking the obvious question when announcing the news. “It all comes down to a simple idea: finding new ways for artists to support their work. New ideas are found at the intersections, and we believe that there is a convincing between music and economics. “
Square said it took a “significant majority stake” in Tidal, which Jay-Z bought in partnership with other artists for $ 56 million in 2015. The service, which has artists like Coldplay and Daft Punk as owners, differed from the offering high-quality audio and video and paying artists better royalties rates than rivals like Spotify.
While Tidal has carved out its niche by offering more than 70 million songs and 250,000 high-quality videos, the global market is dominated by Spotify, Apple Music and Amazon Music. Last month, Spotify announced its own high-resolution streaming option, which will compete with Tidal. In 2017, Jay-Z removed most of his music from Spotify, but restored it in 2019 for his 50th birthday.
Square, founded in 2009, offers financial tools for small businesses that will help artists explore options such as receiving digital payments directly from fans. “There are tools they need to be successful and that we will build for them,” said Jesse Dorogusker, a Square executive who will temporarily lead Tidal.