CFIV - Keep an Eye on Rumble as Spotify's Joe Rogan Controversy Continues
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Spotify (NYSE:SPOT) stock is in a tight spot — pun intended. The music streaming giant continues to battle backlash against comedian Joe Rogan, who hosts the company’s most popular podcast.
The Joe Rogan Experience is under attack for the host’s vaccine conspiracy theories and past racial slurs. The show typically draws an average of 11 million listeners per episode.
Influential musicians such as Neil Young and Joni Mitchell have pulled their music from the platform in response to Rogan’s comments about Covid-19 vaccines. The company also recently took down 113 episodes of the podcast that contained racist language.
So far, Joe Rogan has apologized and Spotify is sticking by the controversial podcaster. But there are now rumblings that his days with Spotify could be numbered. If that is the case, he might be snatched up by another suitor.
Joe Rogan Could Get Ready to Rumble
Several media outlets, including Time magazine, are reporting Rumble has offered Joe Rogan $100 million to leave Spotify and bring his podcast over to the conservative video-sharing platform.
In an open letter posted on Twitter (NYSE:TWTR), Rumble Chief Executive Officer (CEO) Chris Pavlovski said he supports Rogan and would love to partner with him on Rumble:
“We stand with you, your guests, and your legion of fans in desire for real conversation. So we’d like to offer you 100 million reasons to make the world a better place.
How about you bring all your shows to Rumble, both old and new, with no censorship, for 100 million bucks over four years?
This is our chance to save the world. And yes, this is totally legit.”
Canada-based Rumble positions itself as an alternative to Alphabet’s (NASDAQ:GOOG, NASDAQ:GOOGL) YouTube. Since launching in 2013, it has become a haven for right-wing commentators, free speech advocates and conspiracy theorists.
The site has grown exponentially in recent years. Since the onset of the pandemic, Rumble’s monthly viewership numbers have risen from 1.6 million to 31.9 million.
That growth has not gone unnoticed. Venture capitalist Peter Thiel, who co-founded PayPal (NASDAQ:PYPL) and was the first outside investor in Meta (NASDAQ:FB), has taken a stake in Rumble. Now, the video-sharing site is going public through a special purpose acquisition company (SPAC) deal.
Implications for the SPAC Deal
Rumble announced on Dec. 1, 2021 that it plans to go public through a reverse merger with SPAC CF Acquisition IV (NASDAQ:CFIV). The exact date for Rumble’s debut hasn’t been disclosed. But the video sharing site is expected to go public at an enterprise value of $2.1 billion.
The company has partnered with former President Donald Trump’s proposed social media platform, Truth Social. The planned alternative to Twitter is also preparing to go public in a reverse merger with SPAC Digital World Acquisition Corp. (NASDAQ:DWAC).
Rumble has previously partnered with right-wing commentators, such as journalist Glenn Greenwald. It has also reached an agreement with former U.S. House Rep. Tulsi Gabbard.
The idea of Rumble signing Joe Rogan, who inked a deal with Spotify in 2019 reported to be worth at least $100 million, has investors excited. Shares of CF Acquisition IV rose as much as 43% on news of the offer made to the controversial podcast host.
This comes as DWAC’s share price rises in the lead-up to the launch of Trump’s Truth Social on Feb. 21. Year-to-date, Digital World Acquisition’s stock is up 62% at $83.68 per share. The stock has risen 423% since the beginning of October 2021. In comparison, CFIV stock is at $9.77 per share, but it was essentially flat prior to its recent jump.
Keep an Eye on Joe Rogan and Spotify
There’s a lot of drama going on right now with Joe Rogan and Spotify. Owing partly to the controversy, SPOT stock is down 30% year-to-date at $165 per share.
Where things go from here is a bit murky. What is clear is that Joe Rogan and his podcast appear to have a place to land should Spotify decide to part ways with him.
But can Rumble really snag The Joe Rogan Experience? It’s not clear. However, speculation has driven the price of the video sharing platform’s SPAC partner to new heights. This could be good news for the upcoming market debut of Rumble. For the time being, investors should keep an eye on Rumble and its reverse merger.
On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Joel Baglole has been a business journalist for 20 years. He spent five years as a staff reporter at The Wall Street Journal, and has also written for The Washington Post and Toronto Star newspapers, as well as financial websites such as The Motley Fool and Investopedia.?
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