Sweden-based Spotify Technology S.A. (Spotify), the world’s largest music-streaming company, went in for a listing on the New York Stock Exchange (NYSE) in April 2018. Unlike other companies which went in for listing, Spotify opted for what was popularly known as ‘direct listing’.There were several unique aspects to this listing – new shares were not issued and there were no underwriters, no road shows, and no lock-in period for the shares. When the company announced its listing in March, observers said that Spotify was taking a huge risk by opting for direct listing as more than 90% of the outstanding shares would be eligible for trade on the first day itself, and the heavy volume could impact the valuation of the company. Another risk was that without the intervention of underwriters, the stock could experience high volatility. According to Anna Pinedo, partner at global legal services provider Mayer Brown, “It has the potential, if successful, of being a different route for a certain type of company, to have a listed stock. It is an interesting test case.”..

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