Feeds

How's Cameron's favourite Shoreditch startup doing? Oh.

Last.fm scrobbled deeper into debt

The essential guide to IT transformation

If Cameron and his Number 10 advisors are to believed, the future of the British economy powered by Shoreditch web startups is going to be so bright, we'll all need sunglasses. The Conservatives have sought to promote Old Street's webtastic firms as epitomes of entrepreneurship.

So how are they faring? Let's look at one that was singled out by David Cameron in his 2010 speech extolling Silicon Roundabout - Last.fm. “Brought to you by 70 passionate kids from our office in East London, we play our part in changing the way music is discovered and enjoyed, forever," Last.fm boasts on its website. "Hey, someone’s got to do it.”

According to the company's accounts, Last.fm's losses increased in 2010, the last year for which records are publicly available. The annual loss grew from £2.89m in 2009 to over £5m in 2010. That was on a turnover of just £7.992m in 2010 (2009: £7.283m). Administrative expenses increased from £2.95m to over £8m.

A year ago, the Guardian suggested that Last.fm was moving "closer to profit" - but that isn't evident in the financials. It's moving in the opposite direction.

US broadcaster CBS acquired Last.fm for £280m in 2007 and treats it (somewhat generously) as a 'going concern'.

Cameron meets a Shoreditch nontrepreneur

David Cameron wants more successes like Last.fm, channelling funding via the Business Department to the controversial quango Tech City UK, which promotes webby startups. TCUK has burned through £1.79m so far - including over a million on administrative expenses.

"Tech City sends a message about the whole of the UK,” said Cameron in November.

Mind you, so do those accounts. Last.fm has accumulated debts of £29m over its lifetime.

Since the mid-1970s, when it broke away from the post-war consensus, the Conservatives have been wary of industrial intervention - of using taxpayer money to promote loss-making industries. Back then it was British Leyland - today it's nontrepreneurs. Is the Conservatives' 21st Century industrial policy really got any wiser? ®

Bootnote

This isn't the complete picture, of course. Just as with a pyramid scheme, the first in (and first to bail) can prosper. Angel investor Stefan Glaenzer reportedly made £22m from the sale of Last.fm and the co-founders £19m each.

Boost IT visibility and business value

More from The Register

next story
Microsoft exits climate denier lobby group
ALEC will have to do without Redmond, it seems
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
Barnes & Noble: Swallow a Samsung Nook tablet, please ... pretty please
Novelslab finally on sale with ($199 - $20) price tag
Ballmer leaves Microsoft board to spend more time with his b-balls
From Clippy to Clippers: Hi, I see you're running an NBA team now ...
Kate Bush: Don't make me HAVE CONTACT with your iPHONE
Can't face sea of wobbling fondle implements. What happened to lighters, eh?
Video of US journalist 'beheading' pulled from social media
Yanked footage featured British-accented attacker and US journo James Foley
True fact: 1 in 4 Brits are now TERRORISTS
YouGov poll reveals terrible truth about the enemy within
Assange™: Hey world, I'M STILL HERE, ignore that Snowden guy
Press conference: ME ME ME ME ME ME ME (cont'd pg 94)
Call of Duty daddy considers launching own movie studio
Activision Blizzard might like quality control of a CoD film
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
7 Elements of Radically Simple OS Migration
Avoid the typical headaches of OS migration during your next project by learning about 7 elements of radically simple OS migration.
BYOD's dark side: Data protection
An endpoint data protection solution that adds value to the user and the organization so it can protect itself from data loss as well as leverage corporate data.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?