Let’s not overdo this, folks. London-listed Audioboom has recently posted a maiden profit of $30,000 for the first quarter of 2021, while its revenues surged over the same period – the three months to March – by 49% y-o-y to $9.5m. In other words, the company, which has a presence in North America and Europe, is still very much in its growth stages.
However, investors have flocked to the small cap’, propelling it by more than 200% over the past 12 months to a valuation of over $150m. The share price has continued to rise despite clear signs that the media subscription boom is slowing down (see FN 106) as lockdowns ease and Covid-19 vaccination programmes continue at pace.
The business is backed by property magnate Nick Candy, who has a majority shareholding (just under 15%) in Audioboom, and it is run by CEO Stuart Last, a Brit based in New York who spent a significant amount of his career at the BBC. In a recent presentation to investors, Last said the company’s editorial strategy would be to focus on “working with big talent...and driving those shows to successful places.”
A new signing has been YouTube star Bailey Sarian with a true crime ‘Dark History’ podcast. Other originals include ‘Dark Air’, ‘Because Mum Said So’ and ‘A Life Lived’. Last said the platform was “easily” scalable, with 8,000 podcasts on Audioboom at the moment but with the potential to have 100,000 on it without further investment needed. The business’ headcount is also low at 35 people, while its main costs (66%) come from salaries and commissions.
Then there is the hobbyist market where people can pay Audioboom $10 per month for its services. Last identified Acast as the company’s main competitor in the UK and Europe. But let’s not forget Spotify, with a market cap of almost $45bn, which dwarfs Audioboom, as does Apple ($2.1tn) and Amazon ($1.6tn). The latter business has a monopoly on the smart speaker market via Alexa and is looking to expand Amazon Music.
It is in this ecosystem that Audioboom, with a mix of original productions and partnerships, part of its content expansion strategy, has been able to significantly grow its so-called long-tail of content, pushing average global monthly downloads up to 91.6m as of March 2021. Advertisers on its premium network has also increased to 301 brands compared to 270 in Q1 2020 and 198 in Q1 2019, before the pandemic.
It looks as if Audioboom, which both hosts and promotes shows, will continue this impressive scale-up until somebody snaps it up. Bloomberg recently reported, quoting Last, that it is seeking an acquirer. “If a big business is looking to be in the space, and they are looking to acquire a company that is already scaled and has the potential to scale further, then Audioboom is in a prime position to take advantage of that,” he said.
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FN 106 can be found here
FN 105 can be found here
FN 104 can be found here
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FN 101 can be found here
FN 100 can be found here
FN 99 can be found here
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