London-based ticketing startup Dice, which sells mobile tickets without booking fees and with a current focus on millennials wanting to discover new bands to see live, has closed a $6 million Series A funding round.
The round was led by Evolution Equity Partners with participation from existing investors White Star Capital, Designer Fund and Kima Ventures, along with several music industry angel investors. It also added new investor Lumia Capital for the round.
With the Series A, which closed in June but is being announced now, Dice has raised $10 million to date — topping up to its initial $1.6M in seed funding in the interim. It’s grown to 42 employees over that time, including a music and data science team focused on building machine learning algorithms to help users figure out what their next big night out should be via a shortlist of recommended gigs shown below each listed event.
Handily its investor roster includes DeepMind co-founders Mustafa Suleyman and Demis Hassabis — a connect that Dice CEO and co-founder Phil Hutcheon tells TechCrunch has been very helpful as it develops its recommendation algorithms. It’s also aiming to make its data work for promoters to help them figure out when and where to put on a gig, and even what to charge. So it’s aiming to serve both sides of the music industry: fans and artists. The app includes a waitlist feature where fans who miss out on buying a ticket in the primary sale can add their name to be notified if another Dice user subsequently wants to return tickets to resell via the app (at the same price). This then generates demand data that Dice can use to help promoters and artists run more successful events in future.
Machine learning’s a big part of our future as we expand and go into new territories.
“Machine learning’s a big part of our future as we expand and go into new territories — to help understand new things,” says Hutcheon. “Because it’s easy to know your own city but when you go into new cities and especially as you expand and scale what are the right venues for this type of artist to play at? Does their audience go to this venue or that venue? What’s the best price to get someone to attend the concert? What was the waiting list like for that artists?
“The weather? The time of the year? What else is on that night? All these things factor in to the success of an event. And one of the things that we’ve been trying to teach promoters is that it’s probably not a good business model to have every concert available go on sale at nine o’clock on a Friday. Maybe stagger it through the week. It’s okay for it not to sell out in five minutes — it will sell out, but it might just take a little bit longer… As long as each venue is full on the night, that’s fine. That’s our objective.”
We last covered Dice almost two years ago when it launched its iOS and Android apps in its first city, London. Since May this year it’s been live nationwide in the U.K., and Hutcheon says it’s now selling 35 per cent of its tickets outside London.
“We joke around that Netflix is our competitor because they’re trying to keep people in — and we’re trying to get people out,” he says, while conceding that a more traditional rival would be a ticketing giant like Ticketmaster. Although Dice is intentionally far more selective in what it sells.
Dice claims its app is on the phones of close to half (40 per cent) of the millennials in London at this point, although Hutcheon won’t break out active users yet.
He will say that over 700 artists have sold tickets on Dice thus far (it never sources tickets via secondary routes — and is vocally anti-tout, including building its own tech aimed at spotting and preventing touts from buying up tickets; a mission helped by Dice tickets being tied to the mobile device they are bought on).
He also says they have signed up all the venues they want to work with thus far — emphasizing that Dice remains an intentionally curated gigs experience, so they only put events on the app which they personally rate and think their primary audience of up to 33-year-olds will also enjoy.
The team is particularly pleased about snagging a partnership with Apple that will see Dice offering tickets for acts performing at the Apple Music Festival in London this year — through a series of in-app competitions. Another bit of news it’s announcing today.
The Dice pitch from the get-go has been about building a fan-focused, trusted events brand — using seasoned gig goers to power expert curation to give its users the confidence to spend money to go out. It has evolved from an initial human-only in-app gig curation to a blend of human and algorithmic recommendation to try to crack the new (live) music discovery problem at scale.
Nor do they just have new/up-and-coming artists on Dice. Some very big and mainstream artists, playing in massive stadium venues, have also allocated tickets for sale on Dice — including Justin Bieber, Adele and Taylor Swift. But then not all millennials are going to want to go and see a lesser known grime artist play in a basement in Hackney Wick. Some of these kids even want to go see Mumford & Sons — another mainstream artist Dice has sold tickets for via the app… So there’s an inevitable element of variety needed to cater to users’ music tastes.
At the last count, Hutcheon says the app had around 1,400 UK gigs on it. “All really, really good”, he asserts. “Everything on Dice is good. We’re creating this universe where we have quality on there.” While at the same time trying, with the recommendation features, to account for variety of taste — and how taste can fluctuate within the same person. So, in other words, just because you went to see that one grime artist that one time doesn’t mean you only want to see grime artists all the time…
“We’ve taken our time to do discovery because we want to see what works,” he tells TechCrunch. “And it’s pretty amazing how accurate it is. The next release of discovery on Dice… will have a user’s top ten artists to check out over the next month, based on your behavior within Dice.”
Why the focus on millennials? Because they’re going out more, of course. And the occasional high profile Taylor Swift gig aside, Hutcheon says Dice’s “sweet spot is identifying new artists, building those new artists up and getting them to larger venues” — which typically means selling cheaper tickers.
(Which in turn means its youthful users can afford to go out more often and therefore use the app more. So, in short, Dice gets to roll more.) “You want people who use Dice multiple times a month — not just goes to one Bruce Springsteen concert a year and that’s it,” he adds. “That’s what we really focus on. How do fans discover the new artists and get to the concert, know about them, and then discover the next one?”
Dice is grossing “eight figures” in ticket sale transactions at this point, according to Hutcheon — which he describes as “pretty good” going for just two years in. Although it’s not actively monetizing yet — beyond a few sponsored gigs with brands like Red Bull.
“We know how we want to monetize but we’re still building the product and still growing,” he says, adding: “We just need to get a bit bigger.”
The new funding will be going towards more product dev work — with a fully fledged launch of its discovery recommendation feature due soon (a rough-cut MVP version is live now), likely next month; and work ongoing for a feature that will allow users to transfer a ticket to a friend through the app (while preserving Dice’s anti-tout features).
It’s also eyeing international expansion — with Dublin set to be its first city launch outside the UK. A U.S. launch is on the cards too, slated for the end of this year or early next, though Hutcheon talks excitedly about Dice’s potential in various European cities too. A big part of his job is making the decisions about where to focus, he says, adding: “There’s still a bunch of things we need to build — which will hopefully be finished by the end of October. And that’s when our focus is outside of the UK.”
With the core tech of the ticketing platform built, Hutcheon reckons launching into new locations can happen quickly — a case of getting people on the ground to scope out the music scene and determine the right sorts of venues/gigs for the audience. Dice employs a team of A&R scouts to go to gigs and find new bands that put on a good live show. (That’s actual humans going to gigs to find the next cool live band; robot scouts most definitely aren’t on the roadmap, he laughs.)
“It may not need to be a choice between the US and Europe; we may be able to do everything at once,” he adds. “What we’ve seen when we’ve launched outside of London is it’s not too much work on the ground… Because we’ve built an end-to-end solution from buying the tickets, automatically paying promotors, having discovery promote the events themselves.
“For outside of London we have two people looking after the whole of the UK and that’s it… So for me it’s just making sure that when we do go into a territory that we have a long term plan. That we don’t just turn up and then six months later retreat.”
Ultimately, for all its music passion and pedigree, the team is also looking beyond gigs — with the core ticketing platform clearly applicable to other verticals. And, along with international expansion, launching into additional verticals is one way to grow usage without having to compromise a ‘curated for quality’ mission.
Getting big enough to see a path to monetizing without losing the inherent selectiveness of its brand promise looks like it’s lining up to be Dice’s post-Series A challenge.
Hutcheon cites theatre and sports as two other verticals on its radar for 2017, although whether any apps it launches for those segments would also be Dice-branded or called something entirely different is yet to be determined.
“We are concentrating on music right now but I think this time next year we would be in different verticals like sports and theatre,” he says. “Music is something that we’re super passionate about, and will always be in our hearts, but the technology side it is a lot of people spending a lot of time solving complex things — and it can address issues in different arenas.”
“Maybe you could pre-order your Tesla on Dice,” he adds. “If you think about it, there’s so many people trying to buy something at the same time — and being able to handle that traffic, and let people know if they haven’t got the ticket immediately that they’re on the waiting list.
“The worst thing is to go on sale at nine o’clock and then be stuck in a queue for 35 minutes or hours… And then at the end of it being told ‘oh sorry, we couldn’t get you a ticket’. So we’ve built it in a way that within a few minutes you’ll know if you haven’t got a ticket. And we’ll put you onto a waiting list, and when someone can’t make it it’s your best chance to get a ticket.”
So from tickets — to potential Tesla buyers… But if you’ve solved the problem of serving surge demand with a frustration-free mobile sales experience then your tech has the potential to scale beyond selling £5 tickets for Toyboy & Robin at The Nest. Or even £55 for Taylor Swift in Hyde Park. Or at least, that’s what Dice is gambling on.
Originally published at techcrunch.com on August 26, 2016.