Staffan Rosell is CEO at PodX. — this interview has been lightly edited for style and readability
SS: Staffan Rosell - what is your background and how did you come about forming PodX?
SR: I worked in media for the past 20 years. I was leading operations for Viacom, the Deputy CEO of Discovery and was then CEO of Bauer Media in the Nordic markets. During the last five years I was really driving the digital and the podcast agenda within Bauer internationally and their mission, the importance of radio companies embracing and developing their digital future. So, that’s my background and my thinking behind PodX.
SS: Who are your co-founders in the business?
SR: Patrick Svensk, who was a TV man, you could say. He built Zodiak TV (today a part of Banijay), and Nice Entertainment for the Viaplay Group. Also, Fredrik Said, who comes from Acast, and is really the one of us who has the most international podcast background. So, Patrick has built something like PodX in the TV world, Fredrik has been an important part of the international expansion of Acast, and I’ve been working with audio entertainment for most of my working life.
SS: Your goal is to help emerging podcast produce creators with finance as well as IP rights. What is your business model?
SR: We want to build the world leading international podcast collective, if you like: a group of the best podcast creators in the world. We think that by bringing them together, they will become stronger, learn from each other, and take each other’s formats to an international market. We see that many of the podcast businesses are very small but very talented, and together they will become stronger. So the business model is to invest in these companies and to become a majority shareholder. Everyone will keep their brands, their podcast, their culture, their language, their nationality; but if we can consolidate this in one group, we think the overall group will be much stronger. We become majority shareholders of the businesses that we invest in, and the founders of those businesses become minority shareholders of PodX. So that’s why we believe it’s truly a collective. In a few years time, podcast creators from all over the world will together own maybe half of PodX.
SS: I guess what you’re saying is the whole is greater than the sum of the parts. It’s the products family together will make a stronger proposition. How do you fund and finance it?
SR: We’re financed and funded by the Swedish investment group Qarlbo. They are the majority shareholder now of products that provide the financing for the investments that we do.
We are very neutral when it comes to business models. I mean, we see that there is an advertising business model, there is a subscription business model, there are commissioners ordering and asking for content from podcast creators, there are branded podcasts - so there are multiple business models around podcasting at the moment. And we don’t know, and I don’t think anyone knows, which of those will grow the fastest and be most successful.
I think that many of these models will exist in parallel. We like podcast companies that have great content, and that have found a business model that works for them - not necessarily the same business model as another company that we invest in. So that’s how we think around that.
SS: You’ve got quite a large portfolio now: you now have companies in Argentina and Finland. What’s the criteria for acquiring the next company?
SR: We have decided to limit ourselves to Europe primarily and Latin America. We believe in big languages that could reach many people: English being the most important one, but also Spanish and French. So we believe very much in the greater markets in Europe and Latin America, with a lot of people and big languages. That’s sort of the frame. Within that frame we are looking for very creative and successful companies when it comes to content creation. Companies that have proven that they can make successful podcasts over and over again and generate revenue around those podcasts. So content is the core - that’s the most important part. Management is very important, showing that you can actually do something with your content business-wise.
We also like evergreen content so that you can use your content over and over again. History is a perfect example. True crime, or documentaries where you can listen to something today and you can listen to the same thing in five or ten years with the same level of excitement. That’s the type of content that we like.
Last but not least, we like companies that have the ambition to protect and keep as much of their content as possible in order to be able to do business with it in the future.
SS: Given one of your founders has got a TV background, do you see taking these podcasts and going to TV and film, is that one of the routes to market?
SR: It could be, but it’s not one of the main routes. We say to all the companies that we meet that it’s audio first - it’s podcast first: and if you’re successful and you have something fantastic that someone wants to make television or film out of, that’s great, but that’s a bonus. We are almost a bit worried about podcast companies that think too much of the possibility that everything will become television and film - because that’s not going to happen. That will be, I think, the exception rather than the rule.
When it comes to format development and how to make business out of your IP, we much more believe that a great podcast in Finland could be translated to French and English and Spanish, and be successful as a podcast in other territories.
SS: What is it with Sweden? You put Spotify, you’ve got Acast, you’ve got Podimo down the road in Copenhagen, you’ve got PodX… I mean, what’s going on in the water over there?
SR: It’s probably not for me to say! But you’re right There is a business culture here around technology, and I’m humble enough to realise that I’m not the person to explain that because it’s a much bigger topic.
I guess you have to have a certain financial resources to be successful in building businesses, and especially global businesses within technology. And this part of the world is lucky enough to have a high GDP and good schools and all the rest of it, social welfare and what have you. But it’s interesting that many companies come from here.
But back to your question - we do not at all see Podimo as competitors. We rather see them as business partners because they are commissioning content from several of our companies. They are really clients: they are coming to our companies and asking for content. We see them more as a platform and a distribution partner for the content that our businesses create.
SS: Did you do a funding round? Podimo raised 75 million, which has allowed them to go and do what they’re doing. You’ve obviously got backers, but is the backer a VC or private equity? How much more can you invest?
SR: We don’t know exactly how much more we can invest, but the company, Qarlbo, that funds us has great backing. It’s not private equity, but the money comes from private equity originally and now it’s a private office. And if they like what we’re doing, they could invest a lot more. So we’re not going for any external rounds trying to find money elsewhere: we have the financial backing that we need.
SS: So fast forward six months from now: more acquisitions in the pipeline?
SR: I think we will probably do two to four more acquisitions within that period. We’re also now going into a very interesting phase, where we want to deliver the advantages of being a PodX company to the companies that we have invested in the last six months. So we’re now working hard with business development, content creation, exchanging ideas, exchanging formats, working with IP and the legal side of things in order to not give everything away to the commissioners. It’s really when the fun and the real work starts, when we actually have six companies in the group.
SS: So what’s the exit strategy for PodX, if there is one yet?
SR: I like to say that you should not think too much about the exit strategy, you should think about building a fantastic business because if you have a fantastic business, you can keep it and live from the dividends, you can put it on the stock market, or you can sell it. The core of any business should be to build a fantastic business, and that’s what we’re trying to do.
SS: I only mention it because Spotify and Acast are both floated on markets right now, and I just wondered if that’s a natural evolution for you.
SR: It could be. But, it could be keeping it, or it could be selling it as a whole. Or the stock market, definitely. But we are really at a very early stage. We have just bought the first six businesses in the last six months and we want to build a group to become bigger and more profitable and a leader when it comes to content development and IP creation and development of business around IP in the world for podcasters. And we are not there yet, so we have some more work to do.
You can listen to this interview, and selected others, on the Podcast Business Journal Spotlight podcast - on Apple Podcasts and Google Podcasts.