Scribd Revenue & Funding (2024)

hello everyone my guest today is tripp adler he is the he's an american entrepreneur he's the CEO and co-founder of Scribd digital library and document sharing platform he grew up in Palo Alto California and graduated from Harvard he launched Scribd in 2007 and they now have over 80 million monthly readers and 500,000 subscribers Tripp are you ready to take us to the top sure good alright good so for those people that are not familiar with script or they're not subscribed yet what is it do and what's your revenue model how do you make money so scripts a subscription service for reading so what you can do is pay nine dollars a month and then you can read books audio books magazines newspapers documents on whatever device you like so so it's all basically funded by our consumers who pay the monthly subscription fee okay just there's that one simple pricing just 9 bucks a month yeah it's really simple I mean rather than you know the old model for media where people would pay for each piece of content one at a time we now just have one simple monthly subscription same price for everyone and then you can pay once and once you pay you can just read whatever you like and and with the subscription model the the beauty of that is it gives users really the freedom to just kind of explore different types of content discover new types of content and you kind of focus on what to read and not what to buy and where were you at get us in your head a little bit back in 2007 did you just graduate did you just have a big financial windfall so you could take a risk with Scribd did you have to make Scribd work because you were broke as hell where were you um so I just finished college and we were broke as hell broke is held but at the same time had a supportive parents so I could at least live with them so I didn't have to worry about my my my you know my living expenses on top of that we we did apply to Y Combinator and we raised $12,000 so that also was like a pre at the time a pretty large amount of money that covered you know like they covered our basic expenses so so you know we had the between Y Combinator and and living at home you know we had a few thousand dollars to build a website get that online and that was only enough to get started I mean back then you know 12,000 was was really it was still insufficient to get get service up and running and then we were able to you know once we got some traction we were able to raise venture money and kind of scale from there going down that funding path so up to us today how much total capital has been infused fifty million at this point so so basically the trajectory was it was the first twelve thousand from Y Combinator then we raised forty thousand an angel money and then and at that point we got some tractions we really quickly went to raise three and a half million from from red point and then another 10 from crv and then another ten from Silicon Valley Bank and then another 25 from Khosla Ventures I think that adds up to 50 but I got my math wrong so I was about 50 today and at this point we're profitable so we're just living off profits and which is a which is a good spot to be we're not really intending to raise any more money for the time being where has most that capital gone headcount or just channels where the cocktail to be worked and you wanted to support more money in those channels so for us it's really it's two things its its headcount its content so so we don't actually pay for users you know we started the service is just a free service for publishing and sharing content and it today reaches over a hundred million monthly users so we basically just market our subscription service to those hundred million users we don't have to actually pay for for marketing you pay for a little bit but just a small amount so so our two costs are really just hiring good people hiring good engineers and designers and all types of people that built the product and then also on the on the content side we be good we do deals with book publishers with magazine publishers the newspapers and we make all that content available 3d subscription model and where are you right now today in terms of team size it's about 120 right now okay all there in Palo Alto especially in San Francisco now I'm from Palo Alto but lived in San Francisco you can see the view behind me I was going to say yeah yeah we're right in financial district on the 24th floor so so it's a but most of them are in San Francisco we've now got a small team in New York who does our publisher relationships we also have wait to have a offices in Phoenix we're building our support team out there and and a few other people around the world so walk me through how you make that kind of you have a market right as a traditional marketplace you got to get the content and you got to get the users so when early on when you were solving that chicken-and-egg problem usually marketplace creators did something very creative to make the wheels start spinning what did you do in the early days yes a good question yeah we've basically been in perpetually solving this chicken egg problem for the last ten years so so the early days the the initial idea was we would just allow someone to take a piece of content published on the web and then we would find audience for them primarily via SEO and then then of that SEO traffic a small fraction of people would come in upload their own content and that would kind of get the cycle going so we really got that that that growth is going early on and that's what took us from from the from launch to 100 million monthly users pretty quickly and then the nice thing was how quick was that trip how am I'm gonna take it hit a hundred million probably four years okay so up to about was that 2011 seven seven in 2011 I went from roughly 0 to 100 and then and then we had to figure out a business model so we tried advertising that didn't really you know advertising is not really interesting model unless you're you're you know huge like Google or Facebook we tried you know allowing publishers to sell content that also didn't really scale eventually try the subscription and that worked really well and since we already had an audience we were able to market the service so you hold on hold on I have to stop you there because you take it for granted now but like take me back like that moment you were running all these tests like what was the early indicator what was the test you ran to see if subscription or work and what was the feedback from the tester we said that's where we're going all-in so so we we just put up a simple freemium model that offered some premium features and that quickly became the the most dominant business model for us so that was kind of indication that subscription was working the the big moment for subscription was that when we decided to go partner with all the publishers with their content and so at the time the idea of a book subscription service was pretty crazy most people couldn't even envision that and we went we talked to all the publishers about including their books in our subscription they pretty much all said unanimously but we we were able to get some small ones on and then those like the bigger ones and over time it started to lead to a tipping point we were able to now get up to a million books in our service so it actually all happened very very iteratively and you know the the way we've been able to solve this chicken egg problem over time is just just each step leads to the next and as long as we keep kind of inching forward in in various directions both on the content side and on the consumer side and the business model side it all kind of came together over time what do you out today I think you said is it 500 million or what do you have today now in terms of readers so we reach about 100 million non-paying users a month then we have the last summer announces 500,000 paying subscribers okay that 100 million dollar sorry the hundred million user number though you said that was what you hid in 2011 right I imagine you grew between 11 and 17 right yeah we've grown we just haven't announced the the new traffic numbers the same time though are the the non-paying audience hasn't grown as much over the years just because it's very SEO driven and we've kind of like plateaued in terms of the non-paying audience so then how is it SEO driven helped us understand that well we this library of 70 million documents and uploaded by users and and basically we have over 100 million people a month who come to visit that library of content and mostly people are searching for things on Google and then longtail searches bring them to our library of content got it that makes sense so with 500,000 folks you know paying now a minimum of 9 bucks per month it sounds like that's your only price point that's about you know four and a half million in mr or well over fifty four million and ARR and when was the date when was that date cuz those are this your most recently announced when was that announced uh we announced that like six months ago okay okay so it's fairly yeah it's fairly accurate in terms of today you know we've grown past that quite a bad I mean we're growing at maybe 50 percent per year right now so so yeah I mean revenues going pretty nicely we're pretty profitable and yeah I mean the more we grow the subscriber base the the you know the more revenue we had to return to publishers and authors being getting more and more content in the service and we're just trying to continually get that that kind of growth loop going you're about 20 25 days from a holiday party there and the financial district with your team before everyone heads out do you are you celebrating and you with champagne like do you pass 56 million you think an air are buy that holiday party or no yeah well we every every hundred thousand subs we have a big a big celebration and I mean the next one for us is a million subs I mean that's really what we're aiming towards so that's a big one in that we're looking for to celebrating that's good will you be celebrating do you think you'll pass 600 before the end of the year 600,000 I yeah I don't wanna comment or numbers too much I'll skip a skip over I'll skip over you know to talk we're blowing past 500,000 so we're we're on our way to the next big one we're gonna be announcing soon hopefully that's exciting so what do you help me understand now you said all your user acquisition is free but I'm very interested in how you're more about how you're getting this content so for example I just signed a big book deal with portfolio right and I'm curious if I want to go talk to them say I really like trip I want to figure out to get my book in Scribd what is that negotiation look like on the back end well I mean if we work with a with a publisher the book kind of shows up automatically on our service so the the main the main thing for us that we've had to do is just is work with publishers to get the model comfort with this kind of model are you paying them though or is it a just a trade oh we we definitely pay them I don't know so we have a number of different types of deals in place these days the the main type these days is we will pay by the read of the book so this way it from from their perspective it more or less looks like a sale so just like they're selling the book we'll pay them any time the user reads a book what if the user only opens the first 10 pages and doesn't complete the read so yeah so we have a very a threshold that we use for for win-win the book counts as reads it's usually about 20% of the book is win in that chairs the payment when are you guys gonna start releasing you know Amazon and started getting more aggressive about releasing you know their top 10 most it's funny how they label it they they say like most sold and most read they don't say which ones actually driving the list but what are you gonna start publishing your own best you know best seller or best read list we do share a bunch of those it's a good idea that we should really we do a lot of interesting data I mean we have people reading different books in our service and they read another's just because the nature of the model and the types of content we have so it'll be a really interesting thing to share we we should share that more interesting all right trip let's wrap up here with the famous five number one what is your favorite business book um their business book I would say good to great as I say this is like asking you to pick a baby considering on your book relationships right number two is unscripted ebook and audiobook form so listen to it yeah there's the pitch alright number number two is there a CEO you're following or studying trip I not not really but um I guess if I were to pick I think a couple I think I mean the other ones doing big strips and services so like I mean I'm a big fan of other services that have kind of pioneered some ideas we're pursuing so like Reed Hastings at Netflix or Daniel Hackett Spotify and they both accomplished really interesting things where we're trying to do something similar for for reading so I think those are those are two to type a lot of had to do number three in terms of building Scribd in the business what's your favorite online tool um I think tableau is really great numbers a week a lot of data so fun to look at data number four how many hours of sleep to get every night um seven eight it's pretty healthy and what's your situation married single you have kids married as of the year ago Oh congratulations any kids yet or no not yet all right none yet and how it are you trip 3333 last question take us back 13 years when he was your 20 year old self knew um I would say just to trust trust my gut a lot you know I looked at mistakes I made it's usually from not trusting my gut so always trust your gut there you guys have it from trip founder of Scribd trust your gut he founded his company back many years ago got his first twelve thousand from Wykeham Mayer he since grown the service again I was back in 2007 launch date he since grown the service supporting over a hundred million readers five hundred thousand of them paying nine bucks a month so about 4.5 million bucks in monthly recurring revenue or about 54 million in ARR growing super super fast with his team of about 120 people out there in San Francisco looking at again how to get more content in the system more readers and more value to the end subscribers trip thank you so much for taking us to the top thank you talk to you