Blue Wire looks to raise $1M in community round
Blue Wire, a sports podcast company founded in 2018, will open up a community fundraising round on Tuesday, allowing podcasters and fans to invest in the company directly, its founder Kevin Jones told Axios.
Why it matters: More companies are looking to community fundraising rounds to raise cash as the deals market slows for private funding.
Details: The firm is looking to raise at least $1 million through the new round at $26 million valuation cap, Jones said.
- Blue Wire has raised $12 million since 2020, including a $1.2 million seed round and a $5 million series A led by Dot Capital, a $3.5 million investment and studio residency with Wynn Resorts, and various angel investments.
- The money will be used to grow Blue Wire's ad sales team, add more profitable content and begin building its own software, Jones said. Currently, there are 24 people who work for the company full time.
- "Since I don't own IP, I want to own some proprietary tech," he added. The software Blue Wire is looking to build will help independent podcasters scale their businesses.
- The software will be used at first to optimize the podcast operations for creators within Blue Wire's network, before the company considers licensing it externally.
Catch up quick: Blue Wire launched originally with a focus on producing long-form narrative sports podcasts. It quickly became a place for major athletes and sports commentators to launch their own shows.
- In the years since, the company has evolved to focus less on original content production and more on building out a sales engine and talent hub for independent podcasters.
- Blue Wire currently has more than 500 creators and 300 podcasts under contract, most of which are sports-focused, according to Jones. There are 25 smaller podcast networks within Blue Wire that lean on Blue Wire for sales and operations.
- Earlier this year, Blue Wire began handling sales and distribution for other media networks, like FuboTV.
By the numbers: The company brought in $8 million in revenue last year, and it's expected to grow its top line marginally in 2023, according to financial documents viewed by Axios.
- It lost $5 million last year and anticipates only burning through $1 million in cash this year as it approaches profitability.
- The company projects turning a profit for the fiscal year in 2024 on $11 million in revenue.
Between the lines: Blue Wire is one of the few podcast networks that relies on its own sales team to sell sponsorships.
- The company works with more than 100 advertisers annually, Jones said. Advertisers are able to sponsor individual shows or run ads across Blue Wire's podcast network.
- While ad sales make up the majority of Blue Wire's revenue, the company also makes some money for paid services related to podcast and advertising operations, including branded content production, marketing, studio recording, consulting and licensing.
The big picture: A 2021 regulatory change increased the limit for how much money could be raised in a community round, adding to the popularity of community fundraising efforts.
- Substack raised more than $2 million in a community round earlier this year.
- Blue Wire, like Substack, is using a platform called Wefunder to facilitate the raise.