Socialite has developed an app that builds the user a personalised feed of upcoming events from their interests. Their proprietary software has so far sourced over 150,000 events including; fixtures, release dates, airdates and events in the categories of Sport, TV, Film, Gaming and Music across 10 countries. The company is backed by a £97,435 Technology Strategy Board Proof of Concept Grant.
Try and answer these questions off the top of your head:
- When is the next season of your favourite TV Show?
- When is the next time your favourite sports team is playing?
- When does your favourite artist’s new album released?
Did you answer any of these with “I don’t know”? Don’t worry if you did; like many people, keeping up to date with your interests is a daunting task. We believe it should be easy.
The fact is our lives are filled with these little events that need to be discovered, remembered and managed.
Even the most organised people have to search for release dates or fixtures via search-engines and then manually add them into their calendars. People are busy, dates constantly change and it’s a hassle to keep track of everything. It’s unnecessary.
How Socialite solves this
Socialite has designed it’s own proprietary software to collect upcoming data, from a wide number of categories automatically at a fraction of the time it would take to manually curate. This data includes fixtures, release dates, airdates and events in the categories of Sport, TV, Film, Gaming and Music across 10 countries.
Users download our iOS and Android apps, register and follow their interests. Socialite builds them a personalised feed of upcoming content and automatically notifies them before the event occurs.
Why we’re different
Unlike many event discovery companies who confined to ticketed events, Socialite’s strives to have a wider focus and incorporates all types of entertainment content, including release dates and and sporting fixtures. We think this is far more exciting and gives us the freedom to incorporate data previously ignored on other platforms.
All this content that we push to users is monetisable. For example, a game release date could contain purchase links allowing the user can preorder the game with Socialite taking affiliate revenue from this. These purchase links are precisely targeted at the user’s explicit interests.
In the future we plan to explore other revenue streams such as promoted content and subscription based business accounts.
Achievements to date
The software used to automatically aggregate upcoming events is built and has so far sourced over 150k events. Our iOS and Android apps are publicly available and from our 10k test users we have found that they want a better way to discover new interests.
To do this we are building an event recommendation engine to make intelligent content suggestions. This is backed by the UK Government’s Technology Strategy Board through a £97,435 Proof of Concept Grant. This is designed to harness the power of machine learning and give us a competitive edge by increasing our user engagement and retention.
Through testing various marketing strategies over the last 12 months we are confidend we have a cost effective way to acquire users. This means that we can maximise our marketing budget by targeting the right user segments and channels.
Proceeds of Investment
Your investment will help support this grant and get us to get to a position where we can raise a Series A investment within 12 months. To achieve this we will deliver on a number of key development milestones across both web, mobile and data collection.
We are asking the crowd to join us on the next chapter of our business and let our fans, users and supporters be a part of our business.
Socialite’s business model is built around pushing targeted events and content recommendations to users with a high intent to purchase via mobile and web. This is taking advantage of the rapid growth in Affiliate Marketing, M-Commerce and Mobile Usage.
Growth in Affiliate Marketing
In 2013 40% of Amazon’s revenue was from Affiliate Marketing showing how integral this is to their business. In the UK alone there were 150 million purchases via Affiliate Marketing, resulting in £14 billion worth of sales. Our initial purchase link experiments have yielded an average click to purchase (CTR) of 8.71%. In comparison, Shazam, one of the UK’s first $1bn startups has a conversion between 5-10%. We understand we achieved this high percentage due to the highly targeted nature of our content. As we begin to increase the number of these links and optimise the time and delivery of notifications, we believe we can increase the CTR even further. This should make Socialite a lucrative affiliate partner to e-commerce sites, especially those who are looking to drive more traffic from mobile users.
Growth in M-Commerce
Sales from smartphones rose by 186% in 2013 compared to the previous year in the UK. This is driven by the increased adoption of smartphones in daily life and consumers becoming more confident making purchases on mobile devices. In the UK, shopping via mobile is set to increase by 78% this year compared to 2014 . As this trend continues it should make it easier to drive revenue from our affiliate links.
Mobile Usage and Trends
App usage increased 76% in 2014, Shopping and Utility apps in particular growing at an an average of 147% between them. We believe there has been a trend towards personalised content streams such as Twitter’s Custom Timelines, Linkedin’s Showcase Pages and Pinterest’s “pin feed” allowing users filter content specific to them. Socialite is designed to align with both of these trends.
Those already in this space
There are companies that are focused in specific categories. For example, Songkick for music gigs however, to the best of our knowledge there are few that attempt to aggregate from a wider number of categories. There are “social calendars” such as UpTo and Sunrise who have interest calendars that can be followed. From our research we understand they have a small number of events and cover fewer interests when compared to Socialite. In general, release dates and product releases are rarely included on other platforms, there is a much heavier focus on live ticketed events. We think this presents a massive opportunity for us.
William Drewett (Founder)
An Economics (BSc) graduate with previous experience working at Lloyds Banking Group, Private Banking. Working within the Risk Division, he was responsible for researching and implementing data analytics for the use in a more holistic approach to risk management.
He worked on an industrial placement at Floxx Media Group, a digital design agency based in London. Here he learned the process behind designing and building high quality apps and digital media. After an additional placement with Hiyalife, a company accepted into a tech incubator backed by Telefonica, he founded Socialite.
Adrian Ko (Lead Developer)
A Computer Science graduate (MSc), Adrian has been working with the company for the last 2 years. During this time he has designed and built the automated data management system.
Board of Directors
Jonathan Beddoes (Investor & Director) – Whilst at university Jonathan co-developed a popular music software application which has been used by 1.5m users concurrently. Today he advises a wide range of startups through his own investments and as a mentor for TechStars.
Stephen Thornton (Investor & Director) – Stephen has held a number of senior management and board level roles at British Steel, AEA Technology and BOC Group. He co-founded and remains a shareholder in Virgin HealthMiles.
Ricky Thomas (Investor & Director) – Ricky was the Founder & CEO of Petmeds for 6 years until he sold it to MedicAnimal in 2012. He is currently the Founder and CEO of TrueDash, providing cloud based business intelligence to some of the largest companies in the UK.
Peter Williamson (External Mobile Developer) – Pete has been working with us closely from the beginning. He is the lead developer at Comcar with experience in dealing with large databases for major automotive clients including Mercedes-Benz and Peugeot.
Sani Yusuf (External Mobile Developer) – Sani has extensive knowledge in building HTML5 mobile applications.
Scott Wooden (External Design Consultant) – Worked with brands such as The Sun Newspaper, Barclays, BMW and V Festival.
These notes should be read alongside the Financial Snapshot
SALES: Key sales drivers
- Affiliate Revenue from purchase links. Already implemented and affiliated with iTunes, Amazon and Viagogo. Commission from purchases ranges from 5-9%.
- Paid business accounts, based of monthly subscription from a proportion of business accounts.
USE OF FUNDS: Outline how you plan to use the funds you raise on Crowdcube?
- Continued development of mobile applications and backend data scraping technology. This is via consultancy and salaries.
- Marketing budget. To build traction to get us into a position where we can raise a Series A Investment.
EXPENSES AND PROFITABILITY: Please comment on your expense levels, gross and EBITDA margins
- There is a large investment into software technology which is why the company will not break even until 2018/19.
- Salaries based off market rate of developers in London. General/Admin costs based off historical spending. Direct costs have not been calculated due to nature of the business.
EXISTING DEBT OR EQUITY INVESTMENTS: Please outline the background to any existing debt or equity finance on the company balance sheet
- First investment (£25k) was made by angel investors in February 2013.
- Second investment (£150k) made by angel investors in August 2013.
CASH: Cash burn rate, Operational cashflow, when will you need to raise the next round?
- We have forecast that we will need to raise the next round within 8 months based off a burn rate of around £22k
- We are more likely to delay marketing spend that will give us additional flexibility with our cashflow and extend our runway to 12 months.
The Exit Strategy
We want Socialite to fulfil its full potential to become a global company. Our core-focus is to create the best product-service in this space. To support this the company plans to raise further capital; this is likely to be done through institutional means.
YPlan, a London-based startup in a similar space recently raised $24m ($38m in total) demonstrating that there is a strong investor appetite for mobile-focused companies in the events industry.
Socialite will be able to measure the interest in upcoming events, across a wide number of verticals. In addition, the usage of Socialite requires users to validate what their interests are through both explicit preferences and implicit behaviour. This data aspect could become incredibly valuable and attract the interest of major players such as Facebook or Google. Both focused towards understanding user behaviour and organising information respectively. Other interested parties could be from existing ticketing sites such as Ticketmaster, Viagogo, Seatwave, Stubhub, who may be interested in expanding their mobile footprint. As existing affiliate partners we believe we have the visibility.
If Socialite can achieve scale, within 3-4 years we can be a very attractive acquisition opportunity or Public Offering. These would be the most likely type of exit.
This company is offering both A and B shares. If you invest £3,000 or more you will receive A-shares which have full voting rights. If you invest less than £3,000 you will receive B-shares which have no voting rights or pre-emption.
Socialite has submitted their plans to raise money, details of their structure and trade etc. to HMRC and has been given advance assurance that the proposed share issue is likely to qualify for Enterprise Investment Scheme (EIS) tax reliefs relating to their shares.
Tax relief is available to individuals only, who subscribe for shares in an Enterprise Investment Scheme (EIS). Relief is at 30 per cent of the cost of the shares, to be set against the individual’s Income Tax liability for the tax year in which the investment was made.
If you sell, give away, exchange or otherwise dispose of shares, tax reliefs can reduce your Capital Gains Tax bill. Your shares must meet certain conditions to qualify for these reliefs.
The availability of any tax relief, including EIS and SEIS, depends on the individual circumstances of each investors, and may be subject to change in the future. If you are in any doubt about the availability of any tax reliefs, or the tax treatment of your investment, you should obtain independent tax advice before proceeding with your investment.
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