Spotify Technology SA’s $100 million Creator Equity Fund, designed to promote diversity in music and podcasts following controversial comments by the company’s star podcaster Joe Rogan, spent less than 10% of the money on that work as it rounded out its first year.

The initiative got off to a slow start hiring staff and has suffered from shifting priorities, according to people familiar with the effort who asked not to be identified discussing an internal matter. At the start of the year, the fund was still finalizing its 2023 budget and had yet to determine its priority projects, according to a memo obtained by Bloomberg News. 

Another Spotify fund aimed at promoting diversity in podcasts suffered after that business was hit by layoffs last year, a union representing workers said.

Spotify declined to comment on specific spending numbers for the equity fund, but a spokesperson said it backed a number of initiatives in its first year, including Glow, which highlights music from LGBTQ artists, and Nailing It, a podcast hosted by three Black women.

The company this week announced an expanded partnership with Spelman College, a historically Black women’s school in Atlanta, that will include scholarships and curriculum for students interested in podcasting.

“The Spotify Creator Equity Fund is dedicated to a variety of initiatives that help elevate and support an inclusive and diverse portfolio of artists and creators on the platform,” the spokesperson wrote in an emailed comment. “We are able to empower and uplift underrepresented voices around the world.”

The world’s largest music streaming service is hardly alone in facing challenges in following through on such commitments. A recent study by McKinsey & Co. called for greater transparency in how companies allocate money to promote racial justice.

Spotify announced the fund in February of last year after singer Neil Young pulled his music from the platform citing Rogan’s alleged spreading of Covid-19 misinformation. A video in which Rogan used the n-word numerous times was also circulating at the time. 

Employees at the company had spoken out when Rogan joined the streaming service in 2020, saying he spread transphobic beliefs that made them feel unsafe. The $100 million size of the fund was seen as symbolic since it matched the value of Rogan’s contract, various media outlets reported. The New York Times later pegged his deal at over $200 million, however. 

At launch, the company divided the fund between music and podcasting. Teams were organized to pitch ideas, like hosting events for podcasters and musicians, creating new shows and helping with marketing budgets.

Months passed before Spotify hired employees, eight in total, who would ultimately oversee the money—one job listing went live in November. The spokesperson said the company had a dedicated project manager assigned to the fund from the outset. 

The money was designed to be used over three years, according to the people Bloomberg News spoke with, but the streaming service lacked a well-structured, clear system for vetting and approving projects or allocating money. Ideas were pitched but often not accepted. A Spotify spokesperson pointed to the various projects backed by the fund as evidence the system is working and said the fund was designed to last for multiple years, not a specific time frame.

The internal memo stated that the fund’s mission is to amplify the voices and work of primarily Black and LGBTQ creators in the US, UK and Brazil. The spokesperson said the company also funds initiatives outside that remit, like in the Latinx space.

Some of the projects cited in the memo as being backed by the fund, such as a fourth season of the pop culture podcast We Said What We Said, weren’t new to the company.

Unionized employees at Parcast, Spotify’s true-crime podcast network, have also experienced dysfunction at another fund with similar aims. The workers sent a letter to management in February, saying the company had approved just $5,000 in spending over the past year out of a promised $100,000 for annual diversity, equity, inclusion and accessibility work.

“We are seriously questioning this company’s commitment to funding this committee, and by extension, the values it represents,” the union said.

The Parcast diversity committee intended to use some of its budget to host a Halloween event that would involve a screening and discussion about a documentary series, Queer for Fear: The History of Queer Horror, according to people familiar with the plans. But weeks before the event was set to take place, the company laid off 30% of the union staff, including committee members, and those remaining canceled the screening.

Spotify said it was the committee’s decision to cancel the event, which was to be supported by money outside of the $100 million creator fund.

—Bloomberg News