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What's your business model?

110799

How does SeatGeek make money?

SeatGeek takes a percentage of sales made through the site, and tickets sold on its own marketplace

Innovation series by Steven Loeb
July 9, 2016
Short URL: http://vator.tv/n/4666

Updated to reflect new information on advertising revenue

Secondary ticket markets, like StubHub and ScoreBig, have risen up in response to the ridiculous surcharges from TicketMaster. The problem is, though, that people sell those tickets for even higher markups. And since there are so many of them now, it's almost impossible to know if you are getting the best deal on your seats.

Ticket search engine SeatGeek is the solution to that problem. It acts like a Kayak for tickets, with a search engine that looks for tickets all over the Web, showing users which site has the best price. Sadly, that may mean still paying those TicketMaster upcharges, but at least you won't get hosed by upsellers. 

The company makes its money from two revenue sources.

  • First, it gets a cut of every ticket sale made through the site.

When someone comes to the site and clicks to buy a ticket, they are redirected to the corresponding partner site. If they complete the order, and buy a ticket, SeatGeek gets a percentage of that sale paid to it from the partner site at no additional cost to the ticketbuyer.

SeatGeek doesn't say what that percentage is, but others have pegged it at roughly 10 percent of the ticket price. 

  • The second revenue comes from the fees from its ticket marketplace. This is a fairly new stream, having only been introduced late last year

In November, SeatGeek announced a new marketplace, which allows ticketholders to list, sell and transfer tickets directly to other fans, making it a competitor with the sites it is aggregating from, most notably StubHub.

Listing tickets on SeatGeek is completely free. When a ticket is successfully sold, SeatGeek takes a 15 percent fee off of the purchase price.

Update

  • While Seatgeek used to also make money from a stream that called "digital sales," or other companies paying SeatGeek to advertise on the site, it no longer makes money this way. It stopped doing these ads in November 2014.

"The primary reason is because we, and our users, really value the simplicity inherent in our design. We came to the conclusion that putting ads on the site detracted from that simplicity so we decided to cease advertising," a spokesperson for SeatGeek told me.

Founded in 2009, SeatGeek has raised $103 million in funding from Technology Crossover Ventures, Founder Collective, Causeway Media Partners, Mousse Partners, Carmelo Anthony, Shane Battier, Peyton Manning, Eli Manning and Nas.

(Image source: seatgeek.com)


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