This Entrepreneur Built a Business That Pays You to Listen to Podcasts. Here Are His 4 Tips for a Successful Business Idea.
Podcoin is billed as the first app to reward podcast listeners for their time.
It's a dream as old as time: Get paid for doing exactly what you normally do with no extra effort whatsoever.
Geoff Cook, founder of Podcoin, aims to make that a reality with what he calls a "loyalty points program" for podcast listeners. The platform, which launched in January 2019, pays each user one "podcoin" for every 10 minutes spent listening -- or between $0.015 and $0.04, depending on your frequency of usage and which podcasts you listen to. Users can cash out via gift cards to outlets like Amazon and Starbucks or use their earnings to make charitable donations.
Over the past four months, Podcoin's usage has grown 15 percent week-over-week, according to Cook, and reached one million listening minutes per day. It's backed by another company he launched, now called The Meet Group, which has exceeded $400 million in acquisition costs. As for how the app makes money? Podcoin is focusing first on building an audience, according to Cook, but he has a future plan for profit: Content creators will pay Podcoin to boost a podcast's value in terms of monetary gain for listeners; the more Podcoins users can earn listening to a certain podcast, the more listeners the podcast should amass.
Here are the four strategies Cook used to build the company -- and what he recommends for budding entrepreneurs pursuing their own business ideas.
Combine a "deadly sin" with a "heavenly virtue."
In 2011, LinkedIn founder and startup investor Reid Hoffman told The Wall Street Journal that the most successful startups tend to correspond with one of the seven deadly sins. Facebook taps into ego, he said, while LinkedIn could represent greed. Cook adopted Hoffman's mindset but raised him one "heavenly virtue" -- opining that a quality business idea has both at its core. For Podcoin, he said, that's greed (accumulating money and gift cards through listens) and charity (listeners can donate what they earn to the cause of their choice). The company works with charity partners such as Alex's Lemonade Stand and Action Against Hunger.
Find a "parade," and jump in front of it.
Identify emerging trends in business or the zeitgeist -- Cook calls them "parades" -- and tailor your business idea to one of them. One good place to start: Study today's most successful startups. Within a 10-day period, Glossier, Rent the Runway and Casper all topped $1 billion in valuation and joined the unicorn IPO club. Glossier and Casper both jumped into the direct-to-consumer market early on with promises of high-quality makeup and mattresses, respectively.
Add a novel twist by connecting two different "parades."
Two parades are better than one. Exhibit A: Rent the Runway's success exemplifies at least two trends -- minimalism (spread in part by organizational expert Marie Kondo) and the younger generations' predisposition to rent instead of own. With Podcoin, Cook aims to connect podcast listening and gamification, plus incorporate social media into the fray.
Deploy typical mobile app concepts like "bottomless bowl" and "streaks" in pursuit of fundamental good.
Mobile apps often use strategies to boost user engagement, such as "bottomless bowl" content (a feed that refreshes ad infinitum) or "streaks" (consecutive days of app usage). As screen time tracking and mindfulness apps gain traction, these strategies have incited some controversy, but Cook said he believes they're viable as long as they drive engagement for something that's a fundamental good -- for example, podcasting. "Podcasts and longform content [are] an elixir for the distraction-based media we all consume," said Cook.