SeatGeek

How Three Founders Scaled SeatGeek to $1 Billion in Ticket Sales

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About
Business

Jack Groetzinger

Founder, SeatGeek

$208M

revenue/mo

Founders

900

Employees

SeatGeek

seatgeek.com

from Wait-a-Bit, Jamaika

started January 2009

$208,000,000

revenue/mo

Founders

900

Employees

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Monthly Revenue

$208M

Founders

Employees

900 (est.)

Profitable

Yes

Year Started

2009

Customer

B2B & B2C

Founders

Employees

900 (est.)

Profitable

Yes

Year Started

2009

Customer

B2B & B2C

Who is Jack Groetzinger?🔗

Jack Groetzinger, the co-founder of SeatGeek, is originally from Cleveland and attended Dartmouth College, where he met his SeatGeek co-founder. Before SeatGeek, he and his co-founder ventured into other entrepreneurial endeavors, including an online furniture rental business.

What problem does SeatGeek solve?🔗

SeatGeek makes buying tickets for live events easy and stress-free by providing transparent pricing and a simple app that helps customers find the best deals, allowing fans to enjoy events without worrying about getting ripped off or confused by complex purchasing processes.

How did Jack come up with the idea for SeatGeek?🔗

Jack Groetzinger was always a sports and music fan, which made him keenly aware of how broken and frustrating the ticketing market was. He and his co-founder, Russ, both found it surprisingly difficult to buy tickets easily and affordably for events they loved. After moving to Boston, they experienced firsthand the lack of transparency and ease in the ticket-buying process, which sparked their desire to create a better solution.

Initially, they believed that using analytics to time ticket purchases for the best deals would offer a more manageable improvement, akin to how people buy flights. They were inspired by a company called Farecast, which used similar methods for airline tickets. But as they dug deeper into the complexities of ticketing, they realized the challenge and had to pivot when the original model didn't capture users' interest.

Jack and his team spent significant time refining SeatGeek's model, driven by the belief that people deserved a better ticket-buying experience. They launched a mobile app and gradually expanded SeatGeek's scope after gathering user feedback and observing market trends, allowing the company to grow and evolve into a comprehensive ticket marketplace. Jack’s background running small ventures and his consistent passion for improving user experiences were crucial stepping stones in developing SeatGeek's now widely recognized marketplace.

How did Jack build the initial version of SeatGeek?🔗

SeatGeek's founders initially faced a challenging process in building their platform. They began with a focus on using analytics to bring transparency in ticket purchasing by providing users with data-driven insights on ticket pricing. The initial version of SeatGeek was developed as a meta-search engine akin to Kayak, scraping data from the internet to populate their platform with listings from various ticket marketplaces. Building this first version took about a year before they had enough traction to seek seed funding, and their ability to show meaningful growth helped secure investment despite economic challenges in 2010.

The SeatGeek team was also quick to recognize the importance of mobile technology and launched one of the early ticketing apps in 2012. This was considered risky at the time due to the nascent state of mobile commerce and apprehensions about making high-value transactions via mobile devices. The app development focused on creating an interactive mapping feature on iOS, a complex challenge that took significant effort but paid off by leveraging emerging trends in mobile advertising.

As they expanded, SeatGeek had to overcome hurdles associated with maintaining high user trust and providing a seamless experience, which they tackled by vertically integrating the business. This entailed moving from simply a meta-search service to offering both a consumer-facing marketplace and enterprise solutions for primary ticket distribution. This comprehensive approach allowed SeatGeek to capture the complete value chain, resulting in better user experience and financial outcomes.

What were the initial startup costs for SeatGeek?🔗

Initial Seed Funding: SeatGeek raised their first seed round of about $700,000 in 2010.
Additional Pre-Seed Funding: They did another round raising $1 million after their initial pre-seed round.
Subsequent Fundraising: Over time, SeatGeek has raised around $400 million from investors such as Accel and Founder Collective.
Early Investment in Mobile: In 2012, SeatGeek launched their iOS app which quickly became a significant driver of growth, capitalizing on affordable paid media and efficient user acquisition.
Partnership Deals: They pursued sub-economic deals initially to establish a track record and secure partnerships, such as their deal with Yahoo Sports, which was highly significant for early traffic and SEO benefits.
COVID-19 Impact and Strategy: During the COVID-19 pandemic, SeatGeek raised over $100 million to focus on capturing market share and continue building their team, resulting in increased market share and positioning them to be stronger post-pandemic.

How did Jack launch SeatGeek and get initial traction?🔗

Yahoo Sports Partnership🔗

SeatGeek's early growth was significantly boosted by securing a partnership with Yahoo Sports. Yahoo Sports, being a major sports website, integrated ticketing links to SeatGeek directly within their schedules page, providing a seamless way for sports fans to purchase tickets while browsing game information.

Why it worked: This partnership was pivotal because it allowed SeatGeek to tap into a vast audience of sports enthusiasts who were already engaged with their favorite teams and events on Yahoo Sports. This not only increased brand visibility but also drove a significant amount of traffic to SeatGeek's platform, aiding in building their user base effectively.

Mobile App Development🔗

SeatGeek launched its first mobile app in 2012 when mobile commerce was still nascent. The app was designed to deliver a smooth and user-friendly ticket purchasing experience directly from mobile devices, which was not common at the time.

Why it worked: By being one of the first in their category to offer a robust mobile application, SeatGeek was able to capture a large section of the mobile audience early on. This move capitalized on the growing trend of mobile usage and convinced users of its streamlined process, leading to increased installations and ticket sales. The competitive advantage gained from early entry into mobile helped SeatGeek establish a strong foothold in the market.

Influencer Marketing🔗

SeatGeek heavily invested in influencer marketing, partnering with a vast network of influencers on platforms like YouTube and Instagram. This approach focused on authentic integrations where influencers would use SeatGeek tickets to attend events and share these experiences with their followers.

Why it worked: Influencer marketing allowed SeatGeek to build brand awareness in an organic and relatable way. Fans trusted the recommendations of influencers they followed, and when influencers shared genuine experiences enhanced by SeatGeek, it translated into increased interest and sales. This strategy helped SeatGeek particularly appeal to younger demographics, expanding its consumer base significantly.

What was the growth strategy for SeatGeek and how did they scale?🔗

Mobile App and Early Mobile Adoption🔗

SeatGeek made a significant early move into mobile when it wasn't yet an obvious path. In 2012, they launched one of the first dedicated mobile ticketing apps. This decision came from a belief that mobile would eventually dominate how people purchase tickets, despite initial apprehensions about mobile payments. By being an early adopter, SeatGeek captured a large audience cost-effectively because mobile ad buys were relatively cheaper at the time.

Why it worked: The app not only allowed users to easily search for and purchase tickets, but it leveraged the convenience of mobile notifications and seamless in-app experiences, which built user loyalty. This move was crucial as it led to an increase in app installations when mobile traffic began overtaking desktop usage. This strategic foresight into mobile-first experiences offered them a competitive edge that contributed significantly to user acquisition and retention.

Influencer Marketing🔗

SeatGeek took a unique approach by heavily investing in influencer marketing on platforms like YouTube and Instagram. They collaborated with a vast network of influencers effectively integrating their brand into authentic, relevant content. This strategy resonated with the Gen-Z audience, leading to a higher percentage of young users compared to their competitors.

Why it worked: Influencer marketing allowed SeatGeek to reach younger demographics in a native, engaging way. Unlike traditional advertisements, which can be more straightforward and transactional, influencer content tends to be woven into a relatable story. The authenticity of influencers using and recommending SeatGeek made it a credible and attractive option for fans. It also allowed for scale as successful collaborations could bring significant organic user engagement.

SEO and Content Partnerships🔗

In the early stages, SeatGeek focused extensively on SEO by investing in content creation related to events and interest-based topics like music festivals and sports events schedules. They also partnered with platforms like Yahoo Sports, where SeatGeek links were integrated into sports sections, increasing visibility.

Why it worked: This strategy provided significant organic traffic by targeting high-interest events and content through blog posts and partnerships. By ensuring that relevant keywords and topics were covered, SeatGeek became a go-to resource for fans searching for tickets, contributing to sustained growth. Additionally, these partnerships helped SeatGeek appear alongside major sports content, gaining authority and trust from potential users.

Comprehensive Value Chain Integration🔗

SeatGeek differentiated itself by controlling the entire ticket purchasing value chain, from engaging with venues directly to having a USP like 'deal score' that adds transparency in ticket pricing. This comprehensive approach covered primary and secondary market interactions seamlessly in one app, providing an integrated user experience.

Why it worked: By offering primary ticketing software to venues and handling consumer sales, SeatGeek could ensure consistency in user experience and data gathering, providing insights into user preferences. Their deal score feature, which assesses ticket value, helps users make informed purchases. This vertical integration not only improved user trust and satisfaction but also opened more avenues for revenue, unlike competitor platforms that typically focused solely on secondary markets.

What's the pricing strategy for SeatGeek?🔗

SeatGeek employs a dynamic pricing strategy for its ticket sales, offering both primary and secondary market options, with average transaction values around $200, and leverages SeatGeek Open to allow venues to dynamically price and manage sales directly on multiple platforms.

What were the biggest lessons learned from building SeatGeek?🔗

Embrace Market Challenges: SeatGeek recognized the ticketing industry's widespread dissatisfaction, similar to dealing with unpopular services like cable companies. This pushed them to focus on improving user experiences and integrating technology to meet consumer needs.
Prioritize Mobile Experience Early: SeatGeek was a pioneer in mobile ticketing solutions at a time when mobile e-commerce wasn't mainstream. Investing in a seamless mobile app early helped them capture significant market share and user loyalty, setting them apart from competitors.
Adapt and Pivot Based on User Needs: Initial ventures into price forecasting proved to be less relevant to users. By observing user behaviors and needs, SeatGeek pivoted to emphasize easy purchase options and transparency, introducing features like deal scores to simplify the decision-making process.
Persistence Through Adversity: SeatGeek's resilience during the COVID-19 pandemic, including strategic hiring and product development when competitors scaled back, led to increased market share. Betting on the eventual return of live events allowed them to capitalize on post-pandemic opportunities.
Leverage Influencer Marketing: Their strategic use of influencer partnerships generated significant brand awareness and consumer engagement, especially among younger demographics. Authentic and timely influencer campaigns contributed to SeatGeek's presence in the crowded ticketing marketplace.

SeatGeek Acquisition: How much did SeatGeek sell for and what was the acquisition price?🔗

In 2021, SeatGeek announced intentions to go public through a SPAC merger with RedBall Acquisition Corp. The merger valued the company at approximately $1.35 billion, highlighting SeatGeek's substantial growth in the live entertainment ticketing industry.