Eventbrite Q1 2023 Report

Eventbrite reported their Q1 2023 earnings yesterday. We watch this carefully for signs of health in the overall event industry, as well as understanding our largest competitor and how we compare and contrast. The information below is taken from the Shareholder Letter, Earnings Transcript and 10Q. We also use the RunSignup Q1 data.

Quick Eventbrite – RunSignup Comparison Charts and Data

Eventbrite is about 10-15 times the size of RunSignup and if we are successful, it will take us about 10 years to get to their current size. This is the first time we will do these charts and figures and hopefully we do well over time.

This first chart shows a comparison of each quarter over time with how each company did in 2019 (pre-pandemic) as a percentage of ticket sales per quarter:

This second chart shows how many more signups/tickets Eventbrite does over RunSignup. In Q1 Eventbrite had 23,200,000 tickets sold and RunSignup had 1,975,146 registrations and tickets – a 14X factor.

Other key Eventbrite Metrics:

RunSignup is a private employee owned company and does not release our figures publicly, however there are several key metrics we can share:

  • Our Gross Profit is roughly proportional to the ticket volume multiple between our companies.
  • We had a profit in Q1 and expect to have about a 10% profit margin based on our gross profit this year.
  • We have $0 Debt and maintain a consistent current ratio well over 2X.
  • We do not measure EBITDA since we have no debt and very little depreciation.

Eventbrite Pricing and Marketplace Strategy

Eventbrite is doubling down on increasing their prices in several ways:

  • Price increase to $1.79 per Ticket plus 6.6% including credit card processing (vs. TicketSignup of $1.00 per transaction (family and group friendly) plus 6%, with events over 5,000 getting $0.80 plus 4.8%).
  • Charging for Email with Boost (vs. TicketSignup of unlimited free mail)
  • Increasing Ad Real Estate – essentially blocking out non-advertising customers from generating leads via Eventbrite’s alleged marketplace power.

The result of this strategy might be pleasing to some customers, but we are seeing more and more Eventbrite customers looking for alternatives.

Employee Turnover

Julia and Lanny also talked about the fact they will be offshoring 30% of jobs this year.

“We’re in the process of relocating roughly 30% of our roles to lower-cost hubs in Spain and India. And we expect this realignment to provide incremental operating leverage that will allow us to reach our 20% adjusted EBITDA margin target before the end of 2024.”

From Earnings Call

This on top of the 50% cuts to their employee base at the beginning of the pandemic means a tremendous loss of institutional knowledge, as well as market and customer knowledge. A developer in India may be less expensive that the original developer of a feature who lived in San Francisco, but there is a loss of efficiency when trying to learn someone else’s code and then trying to fix it or make improvements.

The result of this strategy gives RunSignup and TicketSignup a long term advantage. Customers will not feel as connected, and the new features being put into Ads and Boost will cause further neglect in providing interesting ticket solutions to real customer problems.

Innovators Dilemma

Eventbrite was first to market for tickets and garnered wide adoption. However, they are now in the innovator’s dilemma position, with our TicketSignup offering better ticket solutions at lower prices. This is the core reason why Eventbrite is still not back to 2019 numbers. And typical of the innovators dilemma, they have to keep doubling down on raising prices and lowering costs – further providing a rich set of future TicketSignup customers as we begin to gain a foothold and continue to develop better and better software.

Eventbrite will be around for a long, long time. But TicketSignup will continue to eat into market share.

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