Having skipped the traditional initial public offering process, preferring a direct listing, Spotify's newly-minted public shares are tumbling...

As a reminder, Spotify didn't sell any shares and there's no lockup period for company insiders or, with one exception, current shareholders. That means the company’s first public share price, the open price of $165.90, was set based purely on supply from existing shareholders wanting to sell stock and demand for those shares.

It appears that demand is fading fast as, from its post-launch highs yesterday at $169, Spotify is now down 20%...

As Bloomberg notes, Spotify’s stock got off the ground with the help of advisers Goldman Sachs, Morgan Stanley, and designated market maker Citadel Securities. Morgan Stanley was mandated to help Citadel Securities determine the open price based on supply and demand intel gleaned from conversations with existing and potential investors.

We suspect those "investors" are not happy this morning.