Meet Beek, a startup bringing audiobooks to LatAm with the backing of big names • TechCrunch

Growing up in Mexico City, Pamela Valdes says she was a bullied child who was inspired by the stories her parents told about other bullied people, like the highly successful Bill Gates.

“These stories that my parents told me kind of created my reality,” she said.

Valdes acknowledged that his upbringing was more privileged than others in Mexico and throughout Latin America, people who – in his words – heard stories about drug cartels in their cities. These drug lords were often the most successful people they knew, and for Valdes that was not acceptable.

So, while in college, she came up with the idea behind her startup, Beak. In his first iteration, Beak leveraged tools like YouTube and emoticons to create a site and mobile app where people could review the books they read.

“I wanted to get Latinos to consume better stories, so I created this community around the books,” she recalls. “I thought if I could fix reading by making it social and monetize it through e-commerce, then more content would come in Spanish.”

It worked, up to a point. Before graduating from Y Combinator, the Mexico City-based company actually started as a hackathon project in Austin, Texas, where Valdes was studying at the University of Texas. The company then raised pre-seed and seed funding from investors such as Greylock and Accel. But over time, Valdes realized that while the product worked well for people who wanted to engage with the book’s content, it was less effective in getting non-readers to become readers.

Thus, in 2019, by teaming up with the current product manager and co-founder, Guillermo, of Guatemalan origin Sequeira — Beek pivoted to audio. The idea was to give Spanish speakers a way to listen to content published in Spanish, but also to present them with unique content produced by creators.

Audio made more sense, says Valdes, given that Latin Americans often have long commute times; for them, listening to content while driving to work is usually more convenient than reading.

Valdes and Sequeira also realized that while there are 1.5 times more native Spanish speakers than English speakers in the world, the amount of audio content available in Spanish is 10 times less. Amazingly, there are only 25,000 Spanish audiobooks and 100,000 Spanish podcasts available.

Given the opportunity they spied, Beek — who raised $2 million in pre-seed funding early on — quickly raised another $5 million in a seed round. That money, which the company raised in 2019, must seem like a smart investment in retrospect. Over the past two years, Beek has seen its paid subscriber base grow 18x, Valdes says. Meanwhile, 35% of content creators in Beek Market earn more than their local minimum wage in their first month, she says. “We didn’t expect it, but all of a sudden we’ve become a huge revenue model for creators,” she told TechCrunch. “They started releasing things like mini audiobooks and other premium audio content.”

The model makes sense for everyone involved, she says. On other platforms like Instagram or TikTok, she says, a creator needs high volumes of followers to earn some money. On Beek, they are able to generate more recurring passive income with fewer listeners. Creators are also responsible for over 70% of user acquisition, as many of them attract subscribers and then benefit from a revenue-sharing agreement with Beek, which saves money. start-up on marketing costs.

As for Beek listeners, it’s often more economical to pay $12 a month for a subscription to get unlimited access to many creators — such as Haru Escarcega, Rorro Echavez, Regina carrot and Marguga — than having to pay for access on an individual basis. Today, 60% of Beek users are from Mexico, 10% are US-based Hispanics, and 30% are in other parts of Latin America.

To capitalize on its growth momentum, Beek today announces that it has raised an additional $13 million in a Series A funding round led by Mercedes Bent, partner at Lightspeed Venture Partners. The fact that Bent – ​​which has historically focused its investments on consumer fintech and crypto – was drawn to a company outside of its usual areas of interest is remarkable.

She found the company so compelling for several reasons.

On the one hand, Bent was naturally drawn to the company’s impressive year-over-year revenue growth (8x when it invested). But she was also drawn to the team’s ability to use their advisors in ways she doesn’t see at most other startups.

“They’re able to pull very experienced people into their orbit and have them work with them on a daily basis,” said Bent, who joins Beek’s board as part of his company’s investment.

For example, Casey Winters, former head of growth at Pinterest and chief product officer at Eventbrite, also joins the board after serving as an advisor to the company since its inception.

Bent added: “Another really unusual trait was the founders’ ability to articulate the levers they were pushing to control different KPIs – they had a masterful understanding of leading and lagging indicators, how to build a growth engine and how to deliver impact. I don’t normally see that level of mastery of business KPIs in founders until Series B is over and it’s seed founders who have taught the whole team to speak that language.

For Valdes, Bent’s investment isn’t as out of left field as it first appears.

“She invests in fintech, but not just because of fintech — her thesis is empowerment. So she supports products that empower people, and that’s what Beek strives to do,” she told TechCrunch.

Existing backers Greylock and Accel also participated in the latest round, along with new strategic angel investors like OpenAI CEO Sam Altman, Figma CEO Dylan Field, Duolingo CPO Jorge Mazal, Rappi co-founder Sebastian Mejía and Nowports CEO Alfonso de los Rios. Motivational speaker Tony Robbins has also invested through his company IdealabX. “Many “creators active on the platform have also invested in the round, including Lorena OchoaMexican golf world champion and Oso Travaaccording to Valdes.

A sustainable model

Economically, Valdes believes Beek’s choice of a marketplace model has proven more lucrative than choosing to be a media company.

“We have a network effect between listeners and creators that media companies don’t have,” she said. “In the long term, it creates a better and more sustainable business model for becoming the ‘super app’ for audio than if we were trying to produce it ourselves.”

Ultimately, however, it’s more than the money that drives the company — it’s its passion for helping Latin Americans achieve their dreams.

“The majority of content consumed is about self-help, personal development, and business,” she told TechCrunch. “It’s not entertainment content. This is not fictional content. It is actually the content that will give them greater opportunities to dream. And that’s why we exist. We are smart. We are hard workers. We have many opportunities and possibilities… We just need a better narrative in our minds to dream of greater possibilities. So that’s what we want to do: build a better Latin American dream.

Currently, Beek has 51 employees.He plans to use his newfound capital to build more tools to produce content at scale “so creators can launch more content” on the platform while “ensuring that listeners’ experience is super engaging.”

“People will continue to watch El Chapo on Netflix if we don’t give them a much better experience,” Valdes said. “So we have to make Beek addictive. We need to get people hooked on good content that will help them improve their lives.