Wang Xiaoyu literally bet the house on making his startup work, quitting a lucrative job at Google in late 2015 and selling his house to build a podcast app. Two years later, she still takes turns sleeping on a common bed in her Beijing office and has yet to take a day off. But his company, CastBox.FM, completed a $12.8 million funding round backed by IDG Capital and GSR Ventures, early investors in local giants Xiaomi Corp and Didi Chuxing. It has over 1.5 million monthly users and is one of the highest rated of its kind in the Google Play Store.
“I don’t have any hobbies outside of work,” the 30-year-old told CastBox’s Beijing office. “I really want to have an impact, beyond where I live and how much I earn is not that important.” Unlike many apps designed for Chinese audiences, CastBox’s interface is clutter-free and strongly resembles Apple’s App Store. The landing page has recommended content for everyone’s tastes, but the new feature that helps it stand out is in the search bar.
Listeners have traditionally been limited to entering keywords that appear in episode titles, but CastBox’s latest feature transcribes popular podcasts within hours of release so users can search for spoken words. For example, typing “bull in the China shop” will find a colorful discussion of US President Donald Trump about 19 minutes into an episode of “Pod Save America.” Click the link and the audio plays 30 seconds before the corresponding quote.
Even before the feature’s release, CastBox had raised a total of $16 million and unlike most Chinese companies, its success was generated overseas, with Europe and the United States being its biggest markets. . The app has been downloaded 7 million times. In the Google Play Store, it sits in a similar company to rivals Stitcher and Podcast Addict, both of which have been downloaded between 5 and 10 million times.
Wang decided to get into the business while stationed in Tokyo, where she listened to podcasts in Japanese, English and Chinese. From inside Google, she could see a spike in user searches for podcast content and saw that there was no dominant application.
After returning to China, the workaholic set about building the business. Wu Jing of funder Qiming Venture Partners said she once messaged CastBox late at night and Wang replied almost instantly, with the same thing happening early the next morning.
“She has a strategy for trying new things, a good strategy for exploring new things, and a passion that attracts talent,” said Jason Zhen, a partner at IDG Capital who backed the latest round of funding. While podcasting has been around for over a decade, few made money from it in the early years. While only 27% of Americans over the age of 12 had ever listened to a podcast in 2013, that figure hit a record high of 40% this year, according to a report from Edison Research.
The medium is now attracting advertisers with an industry survey of the 20 largest podcast advertising companies by PricewaterhouseCoopers LLP predicting in June that revenue this year would rise 85% to $220 million. Vijay Solanki, managing director of Interactive Advertising Bureau Australia, said while podcasts remained a small part of the media market, they were growing rapidly, driven by smartphones, Amazon Echo-style speakers and digital radios. embarked.
“This is just the beginning of the journey,” he said. “If you have the data, you know exactly who the listeners are and where they are – let’s not underestimate the power of location-based data with podcasting.” CastBox faces many competitors, from Apple’s own dedicated app to a new push from Google. The search giant bought 60dB this week, which also provided personalized content. The American company Audiosear.ch sells the technology needed to search for text in podcasts to developers and publishers.
But Megan Brownlow, a partner at PricewaterhouseCoopers Australia, said demand for content from listeners and advertisers was growing so strongly that there was room for new players. To reach its goal of 10 million monthly active users within 12 months, CastBox is signing exclusive content deals, offering Spotify-style revenue sharing. It also promises to help publishers better understand what drives their audience. The company broke even with banner ads until they were disabled to improve user experience. The result is an app with a rating of 4.7 out of 5 in Google Play.
SIG Venture’s Yaning Gao says CastBox needs to secure a larger base before rivals can steal its technological advantage. It’s a similar strategy adopted by SIG’s other dormant hit, Jinri Toutiao, who turned the news aggregation business into a $20 billion business as internet giants ignored the segment. “As long as CastBox can reach 10 million monthly active users by the end of next year, I think they will be safe,” Gao said.