We are rapidly approaching a milestone in the podcasting world: half a billion people tuning in. And today, one of the independent players looking to capitalize on this growing activity has made an exciting announcement. Podimo, a Copenhagen-based startup with a subscription-based model similar to Netflix, has secured €44 million (equivalent to $48 million) in funding to expand its business.
With this injection of capital, Podimo plans to enhance its production tools, expand its distribution network, and focus on localization efforts. The company, which currently operates in Denmark, Norway, Germany, Spain, The Netherlands, Finland, and Latin America, charges listeners between $5 and $7 per month, while offering higher rates to creators utilizing its platform. And the team has no intention of stopping there – more countries will be added to the list in the future.
Podimo’s success has been evident in the past year, with average user engagement increasing to an impressive 20 hours per month and a subscriber base growth of 80%. While CEO and founder Morten Strunge repeatedly declined to reveal exact numbers in an interview, he did share that the platform publishes around 350 shows weekly. However, with only a small percentage of creators producing multiple shows, there are currently around 350 creators utilizing Podimo’s tools.
The funding round is led by the Danish Export and Investment Fund (EIFO), with HighlandX and Augustinus Fabrikker also participating. This brings the total amount raised by Podimo to just over €200 million, with the last round in September 2022 securing funding of just over €58 million.
As for the company’s valuation, Strunge remained tight-lipped, but did confirm it was an “upround” and shared that Podimo is now profitable in its home market of Denmark. The focus is now on expanding into new markets and reaching profitability in those regions. And while PitchBook’s last estimate was $240 million, Strunge made it clear that this figure is now outdated due to the recent investment rounds.
However, Podimo’s successes and plans for growth come at a tricky time for the podcasting industry as a whole. While there has been a noticeable increase in the number of listeners, for those seeking to turn podcasting into a profitable business, success is not a guarantee. This includes both companies building podcasting platforms and tools, as well as creators themselves.
In September, The Wall Street Journal published an eye-opening article highlighting the challenges Spotify faces with its $1 billion investment in podcasting. This includes expensive deals with well-known names, as well as investments in its own platform. Google also made a significant move earlier this year by shutting down its dedicated podcasting app and merging operations with YouTube, showing that even industry giants are struggling to find the winning formula. And in June, SiriusXM announced the closure of Stitcher, a long-standing and iconic name in the podcasting world, only three years after acquiring it.
What makes Podimo stand out in this competitive landscape is its independence. Unlike many of its competitors, the company remains unaffiliated with any larger platform and can adapt quickly to changes in the industry. However, this also presents a risk of being overshadowed by bigger entities with different priorities.
Strunge believes that Podimo’s unique selling point is its status as a “one-stop-shop.” Creators can use the platform to produce content, including native advertising, distribute it on Podimo, and then distribute it to other podcasting platforms while tracking metrics for all of their content. Going forward, the company plans to further develop this model, with a focus on producing more hyper-local content. This includes creating content in different languages and providing more localized information to listeners.
According to Strunge, the local nature of podcast consumption makes advertising in this medium challenging. “Over ninety percent of consumption is in native languages,” he said. “So there is a fragmented supply side, and the media industry struggles with scale when catering to this market.” And while the company has no immediate plans to introduce advertising-based tiers or reduce subscription rates, there is still plenty of room for innovation in the content itself. Podimo has recently begun creating short-form podcasts, similar to traditional radio news briefs, customized for local markets.
Ultimately, as the podcasting industry continues to evolve, Podimo’s challenge will be to stay ahead of the competition by continuing to differentiate itself and turn a profit while doing so.
