How Does Eventbrite Make Money?

EVENTBRITE, INC. (EB) recent IPO has put it firmly on the radar of investors looking for growth stocks. The company, whose price popped by 59% on the first day of trading, was started in 2006 and is based in San Francisco. It markets events and sells tickets for its online platform. 

At the end of 2019, Eventbrite had 949,000 of what it calls "creators," or event organizers, who ran 4.7 million events across 180 countries. Those figures translated to net revenues of $326.8 million in 2019, an increase of 12% from previous year figures. This followed 44.7% growth from 2017 to 2018. Despite the growth in its revenue figures, however, Eventbrite has consistently reported losses due to higher sales and marketing costs. It lost $64.1 million in 2018 and $68.8 million in 2019—and the 2020 pandemic did not make things better. The 2020 annual report reflected losses of $224.7 million.

How Does Eventbrite Make Money? 

Eventbrite’s main source of revenue is a percentage cut from each ticket sold for an event. “We grow with creators as they plan, promote and produce more events and grow attendance,” the company stated in its S-1 filing. Its online platform offers creators three packages—Essential, Professional, and Premium—which offer different features and fees. While the Essential and Professional platforms are free for event creators to use, the cut taken by Eventbrite differs by tier.

For the Essential package, the company takes 2% plus $0.79 from each ticket sold as of 2021. In that same year, for the Professional platform, the company takes 3.5% plus $1.59 from each ticket sold. There is a 2.5% payment processing fee in addition. The Professional package offers customers additional features, such as customizable checkout forms and detailed sales analytics. Charges for the Premium package are custom and based on a minimum threshold reached in ticket pricing. Customers also get branded and customizable forms and content. Offline, Eventbrite also offers rental equipment for box office and entry. 

The services outlined above also enable Eventbrite to collect customer details, such as credit card data and personal details. The data is shared with event organizers or is used internally for business purposes, such as customer segmentation. 

Besides making sales through tickets, the Eventbrite app also offers other services to streamline the check-in process for event organizers. The Entry Manager app is a check-in app that validates attendee ticket barcodes. The At The Door app is for last-minute sales that enable event attendees to purchase tickets with credit cards at the door.

Future Revenue Streams 

While Alphabet Inc. company Google (GOOG) already dominates online marketing, Eventbrite has carved a niche in the event discovery space. The company intends to expand its revenue channels in the future. According to its S-1 filing, Eventbrite planned to expand its revenue opportunity to tours and attractions, movie theaters, performing arts, and spectator sports. In its S-1 filing, Eventbrite has outlined several future trends in its favor, such as preferences for experiences over products by customers and a 44% increase in employment figures between 2010 to 2020 for the event management industry.