Highly innovative online ticketing platform selling over 1 million tickets per year.
Business overview
| Location | Manchester, United Kingdom |
|---|---|
| Social media | |
| Website | fatsoma.com |
| Sectors | Entertainment Digital B2C |
| Company number | 5495880 |
| Incorporation date | 30 Jun 2005 |
Idea
Introduction
Fatsoma is an online ticketing company founded in 2005.
The Fatsoma platform is an innovative marketing solution for event organizers and venues. It is a complete ticketing platform and allows event organizers complete control of their online ticket sales and online promotion.
Promoters of events use Fatsoma because it's main purposes are to:
• Sell a greater number of tickets.
• Collect more data and information about their customers.
• Increase the online exposure of their events via social media.
Fatsoma has 10,000+ event promoters signed up on the platform and is used by over 1.9 million members to buy tickets. The company continues to grow year on year at an impressive rate, and is in the process of securing major partnerships to enable Fatsoma to grow into new territories and markets.
Operating predominantly in the UK, Fatsoma has also expanded into five other countries, and hopes to increase this presence in 2016.
Intended impact
The ticketing landscape online is changing, and we believe a dominant event and ticketing platform has not been established. Fatsoma aims to become the number one ticketing platform which serves as a platform for both promoters of events and the end customers.
Currently, ticketing platforms will either provide zero marketing support or use very short-term techniques to promote events listed on their platforms. Techniques such as spamming customers with events which are not relevant only serve to frustrate and annoy many customers, encouraging them to unsubscribe from the service and giving them a bad feeling about events being promoted.
Fatsoma's approach is very different in that it takes a much longer term view. The basis of Fatsoma is that it allows event organizers to build followers of their brands, and recommend events which are relevant to their audience. The customer has complete control which brands they would like to follow, and therefore put the trust in the brands to recommends relevant events as opposed to the ticketing agency presuming to know their event preferences.
Fatsoma will therefore never spam a customer with unsolicited emails about events, but instead takes the opposite approach. Where events are recommended through channels of trust such as friend recommendations and recommendations from trusted brands.
This approach has allowed Fatsoma to grow with minimal marketing costs, as the platform by nature is self marketing and has gained credibility through online channels such as Twitter, Facebook, Whatsapp etc.
Fatsoma believes that the marketing of events is most successful when done by the fans of the events and that by encouraging and incentivising fans to help promote events, will ultimately sell more tickets for the promoter.
The company believes this is a much more long-term and sustainable view as it puts the control back in the hands of the customer and the event organiser. Fatsoma as a tech company provides the tools to allow this to happen.
Substantial accomplishments to date
The directors are very proud of the company they have built. Fatsoma was started with very small investment from friends and family and has grown into a company selling over 1 million tickets per year. This we feel is a huge accomplishment and one that we are very proud of.
Fatsoma is also seen as one of the top UK-based tech companies to watch and we believe we have one of the best technology teams in the north-west of England. At Fatsoma we think that our technology practices, ethics and business model attracts the best talent.
The company has also attracted key figures from other well-known technology companies. Chris Allen was the founder and CEO of laterooms.com, one of Manchester's most successful Internet companies. Chris acts as the chairman of Fatsoma. Andy Booth is also a non-exec with a seat on the board. Andy held previous senior marketing roles at Getty images, the Hut Group and Late Rooms.
Monetisation strategy
Fatsoma's revenue model is purely on a 10% booking fee on top of the price of the ticket. Fatsoma does not charge promoters a flat fee or a monthly fee for its services, which therefore means that the service must work for promoters to sell more tickets.
The business can therefore not stand still and innovation is key within this industry.
In our view, Fatsoma's model is different to many other ticketing companies, as our pricing is very transparent. We found customers are regularly frustrated with other ticketing competitors, who will charge fees of up to 20% of the ticket value as well as additional fees for printing tickets or ticket collection. This often frustrates customers as these fees are often only displayed towards the end of the buying process.
Fatsoma aims to change the perception of ticketing companies in the eyes of the public, by being wholly transparent with its pricing model.
Use of proceeds
Funds raised will be used for expansion capital for investment in the following areas:
• Sales and marketing - investment into further markets and locations, by investing in sales personnel on the ground in these locations.
• Partnership Acquisition - Partnerships will propel Fatsoma into new territories and markets and are a key strategy for Fatsoma's growth in 2016. A number of partners have already been secured which are promoting the events for the promoters.
• Technology - the core of Fatsoma's platform has been developed, however in order for the company to continue to grow an investment in technology is needed.
The investment will be used on top of existing revenues* generated to allow Fatsoma to achieve its growth projections in 2016.
*source: unaudited management accounts
Please note that the Company has issued preference A Shares to two external investors. The A Shares carry a preference to proceeds in the event of a sale or liquidation, equal to their subscription price only which is £867,368.92.
Fatsoma currently has a debt facility with the Greater Manchester Combined Authority and RBS bank for a total of £1.05m. This facility was taken to build a completely new version of the Fatsoma platform (Fatsoma V2), which was completed in October 2015. The investment raised will not be used to repay back the funds, but will be invested into further growth, which includes software development and sales.
Market
Target market
Fatsoma's current primary market is 18 - 25 year old ticket purchasers of events in the UK. Fatsoma began as a ticketing platform for student events ran by student event promoters and venues.
The demographic has however diversified into university graduates and into more mainstream events outside of the student demographic.
Fatsoma's latest partnership model means that it can support all types of events which require additional online promotion and marketing support. This has allowed the company to break out of the student ticketing market and moving to markets such as live music, business events, conferences and sports events, to name a few.
The target in 2016 will be to grow further within the 18 to 25 year old age demographic within the UK and overseas and to also further expand the range of events outside of this age range, which is gradually being achieved.
Characteristics of target market
Fatsoma gathers data on ticket sales and customer demographic, so is able to perform a detailed analysis regarding the opportunities in different locations and markets.
Currently Fatsoma's largest cities are London, Nottingham, Manchester, Southampton and Leeds. With Southampton, Nottingham and Leeds being high ticket selling cities, this demonstrates an opportunity for larger UK cities where Fatsoma doesn't have such an prominent presence.
Fatsoma aims to increase it's reach around the UK by forming partnerships in cities where it doesn't already have a foothold. Management believes this to be a faster route to market and more cost efficient roll out strategy. This therefore validates Fatsoma's partnership strategy, which will be a focus for 2016.
Marketing strategy
Fatsoma intends to reach its customers through a number of different methods:
1) Direct Sales - currently sales personnel have been employed in major cities around the UK, in order to build relationships with event organizers and venues to encourage them to list their events and tickets on the Fatsoma platform.
2) Partnerships - Fatsoma is currently doing partnership deals with media companies and lifestyle brands and we're in discussion with larger partners. Fatsoma allows the brands to utilize a ticketing model on their websites using Fatsoma's technology. This is a great way for brands to build extra revenues, but also for Fatsoma to grow its customer base into markets outside of its current demographic.
3) Viral Growth - the nature of the Fatsoma platform is that it promotes events and generates new promoters naturally through its series of network marketing features. Management will continue to invest in technology in order to increase the channels of exposure through the platform and the existing audience.
4) PR - since the recent release of the new Fatsoma platform, the company will embark on a PR campaign to highlight high-profile successes.
Competition strategy
We believe Fatsoma has many benefits over its competitors and to our knowledge has been taking market share from many different rival ticketing companies. Our advantages over competitors are:
1) Technology - Fatsoma has invested significantly into its technology and the platform to build one of the most advanced technology platforms in the industry.
2) Increase Ticket Sales - probably the main benefit to an event promoter is that Fatsoma increase ticket sales for their events. This is the primary reason an event promoter would want to list tickets on a ticketing platform and is the deciding factor when choosing which platform to use.
3) Increase Data and Marketing - Fatsoma's network marketing tools allows promoters to build greater amounts of data on their customers as well as providing marketing support to allow them to contact their customers.
4) Price - the final factor which comes into a sale is the price for promoters to use the platform. As far as we know Fatsoma is better priced than its competitors, as the fees on Fatsoma are much more transparent. Fatsoma can acheive this due to its streamlined technology which allows the platform to handle thousands of clients with very little need for account support.
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