7digital’s CEO and CFO Exit as Dire Financial Situation Continues
7digital CEO John Aalbers has stepped down as director and CEO of 7digital. He joined the B2B digital music platform less than four months ago.
CFO Julia Hubbard is also departing the company, effective immediately. The move was cited as a cost-cutting measure.
In a statement emailed to Digital Music News this morning, Aalbers said his executive team was “immediately challenged with the financial difficulties” 7 digital faced. DMN first reported last month that 7digital was warning stakeholders of a possible bankruptcy ahead.
Adding to the depressing diagnosis, Aalbers previously announced that the company would need a massive cash injection to stay afloat. Since then, executives have been bailing on 7digital left and right. Just two days ago, 7digital Group announced lots of changes to its board of directors. Tamir Koch and David Lazarus joined as non-executive chairs, with Koch spinning a far-flung blockchain savior plan.
Meanwhile, Mark Foster has also departed. Aalbers said he was happy to welcome the new members to “execute the new company strategy.”
That new strategy includes replacing Aalbers with Chief Operating Officer Paul Langworthy. The CFO of eMusic — Michael Juskiewicz — will assume CFO duties for 7digital, with Hubbard offering a transitionary hand.
Tamir Koch currently serves as president of eMusic.com, so Juskiewicz represents another eMusic addition. Upon announcing his role in joining the board, Koch said he hoped to expand the eMusic Blockchain Project. That project hopes to take a decentralized approach to music distribution and rights management.
Koch believes 7digital’s B2B business might be instrumental in creating “new economic models” between fans and artists.
All of this feels like an eMusic takeover, with 7digital getting a total executive makeover. And what about the looming bankruptcy? On that front, Aalbers says the situation is peachy.
“Three and a half months on, we have largely completed the rescue by securing a new, strategic majority investor, which has stated that it is prepared to invest further funds. The final phase of the fundraising is in progress and we expect an additional £4.5M to be raised in the coming weeks.”
Aalbers says these funds will provide 7digital with the necessary resources to implement the company’s “revised strategy.”