With $40 Million in Fresh Funding, Tastemade Is Building a Digital Food Dynasty
To date, the online video network focused on food, travel and lifestyle-related content, has raised $80.3 million.
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Tastemade, a four-year-old digital video network focused on food, travel and lifestyle-related content, is currently rolling in dough. The Los Angeles-based startup cinched a $40 million funding round last week led by Goldman Sachs, with participation by existing investor Scripps Network Interactive, parent company of the Food Network, HGTV and the Travel Channel.
The company had previously raised $40.3 million over the last two years.
Like many so-called multi-channel networks (MCNs), Tastemade -- which now counts a global audience of 100 million active monthly viewers and 1 billion total monthly views -- started off on YouTube. Today, however, it distributes programming across myriad platforms, including its own website and app.
Views are growing fastest on Facebook, founder Steven Kydd told Entrepreneur, where Tastemade was one of the social network's first partners on Anthology -- a program that links advertisers with content companies -- as well as one of the first publishers allowed to monetize its Facebook videos.
Tastemade has also whipped up an enviable buzz as an early participant in Snapchat's invite-only Discover program (it even built a kitchen in its 7,000-square-foot Santa Monica production studio just to shoot vertically-oriented videos) and was the first food and travel-centric channel to launch on Apple TV. In May, when Spotify announced its own video push, Tastemade said it would license cooking-related content to the music streaming leader.
Its shows, often hosted by young twentysomethings, have a gourmet bent and a hipster-ish vibe. Popular series include Raw. Vegan. Not Gross. (see below); Feeling Peckish, about young artists cooking on a budget; and A Brit and A Broad, a travel video blog.
But what separates Tastemade from many traditional MCNs, Kydd says, is that it set out not merely to sell ads against the multitudes of channels it represents but to build a consumer-facing brand. In this vein, he likens Tastemade not to Maker or Fullscreen but more closely to Vice -- except that it's in the lifestyle space.
This, in turn, opens the door to countless other opportunities, Kydd says, which could someday include Tastemade-curated subscription boxes with food, travel and lifestyle products, books, merchandise and even restaurants. It may even one day launch an ad-free viewing model, à la YouTube Red, or expand its events business.
And because "taste' can refer to many categories, Kydd ultimately envisions entering other verticals like home design, style and beauty.
As a video network, Tastemade functions like a pyramid, he says. Of the thousands of creators it works with around the globe, the lowest tier comprises users of its content creation apps, which enable anyone to create and publish short videos about food and travel. This content isn't monetized, but is where Tastemade mines for new talent, Kydd says. Next, for creators that already have a sizable online following, Tastemade serves as a partner in an ad-selling capacity. Finally, at the top of the pyramid, Tastemade produces original content starring its "signature talent," Kydd says, with shows that appear on its own branded channels.
Tastemade is not yet profitable and does not disclose revenues, but its fastest growing revenue streams come from native advertising, Kydd says. Car maker Hyundai, for instance, sponsored a 14-episode series about tailgating called The Grill Iron. The series was so successful that the Cooking Channel picked it up and put it on TV.
The network's mostly millennial viewership leans 60 percent female, with its biggest markets in the U.S., Japan and Brazil.
Tastemade was co-founded by digital media veterans Larry Fitzgibbon, Joe Perez and Kydd, who formerly worked together at Demand Media, which owns eHow and Livestrong.com.
The company attributes its meteoric growth to the fact that food, being something of a universal language, lends itself particularly well to digital media. Kydd adds that a mixture of different components, much like the perfect recipe, has contributed to its success. "It's one part the cultural fascination with and the globalization of food, it's one part emerging forms of digital media, mobile phones and social media, it's one part execution, and it's one part luck."