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Spotify CEO Daniel Ek is keeping his word. After purchasing Gimlet and Anchor, Ek said he wasn’t done investing in the podcasting space. On Tuesday Spotify announced it would be acquiring Parcast, the company started by Max Cutler, the son of radio producer Ron Cutler. Parcast was not backed with major VC money. It was started with money from Max Cutler and his dad Ron Cutler.
Parcast was launched in 2016. Cutler told The Podast Business Journal in February that his dad Ron had a huge impact on him and what he’s doing. Cutler said even though podcasting is different than radio, a lot of the production is similar.
Parcast was launched in 2016 because Cutler believed there should highly produced podcasts delivered weekly that delved into research, stories, and were entertaining. “I thought there was a lot of great public radio shows, comedy shows, but a lot of the same formats and concepts. There was nothing on the weekly side.”
The show Unsolved Murders was released in June of 2016 and from there Parcast continued to grow, recently releasing its 16th show called Extraterrestrial. Cutler said Parcast will pump out 40 shows by the end of 2019.
After the Gimlet/Anchor deal, Ek said Spotify would be investing up to $500 million more into its new podcasting business (the financial details of the Parcast deal were not disclosed). It will be interesting to see if the Parcast business gets rolled into Gimlet and “synergies” are realized as they always are in radio, or if the two businesses remain separate arms at Spotify.
On that topic, here’s another quote from Cutler from our Podcast Business Journal interview last month. “We are not going to be a Gimlet or Wondrey doing 13 episodes and taking time off. We are a volume play — that is the only way to really make money and be in our business model. You need to make a lot of episodes because it is more inventory. We have been very lucky to have sales partners who believe in our product. We have the download numbers. Like in Hollywood, traditionally once you have the reputation of download numbers you are able to go out to the market and demand some guarantee against sales. We are able to do that. We have never cancelled a show. Our shows have always been profitable so there has not been a need to cancel a show.
The Parcast produced shows also include: Serial Killers, Cults and Conspiracy Theories and Mind’s Eye. All of the Parcast podcasts had over 80 million downloads as of last month.
Cutler said what’s crucial to the success of Parcast is that they own all of their content. “We are all-scripted, well-researched, and on the darker side of things…mystery. That allows us to get critical mass from day one. We don’t do sales. I made the strategic decision not to raise money. I wanted to do it my way and go with my gut. My passion lies in creating content and not in the sales side. In order to build Parcast we partnered with some amazing partners on sales. We started off with Midroll, now I guess they branded as Stitcher, handling a lot of podcast sales. They really gave us the sales expertise to grow my company. In September, we switched to Endeavor audio which has been a great partnership for us as well.”
Cutler said the reason Parcast stands out is 100% due to the production value, bringing stories to life from the writing side and the sound design side. He says it’s rooted in their DNA.