Our investment in Verve, the company digitising word-of-mouth
What prompted you to try something new the last time you did, such as a new restaurant, or travel destination? My guess is it was most likely a friend’s recommendation. Not surprising. Today’s audience is growing more and more immune to traditional advertising. We’re too aware that there is little substance and quality behind the tube banners and Facebook ads that we are being fed multiple times per day. In fact, the average number of advertisement and brand exposures a person gets in one day is 5,000. At the same time, 84% of millennials don’t trust traditional advertising and instead see it as deceitful, impersonal and with no value. Increasingly, we prefer to discover through friends, influencers or anyone else we trust. A total of 84% of us think that “earned advertising”, meaning word-of-mouth recommendations from friends, is the most trustworthy marketing channel, when considering a purchasing decision.
This is where Verve comes in. The company has built a word-of-mouth sales platform. This means that companies such as Live Nation, which own and operate large events (e.g. concerts and festivals) can manage teams of “advocates”. These advocates sell tickets to events they love to their friends and network in exchange for experiential, non-financial rewards, such as VIP entrances and other royal treatments. This essentially means that the experiences sold through the Verve platform will always be high quality and authentic; ambassadors are purely passion driven, which will in turn strengthen a brand’s image and only attract genuine fans. It also sets Verve apart from influencer and affiliate marketing, which are just tube banners masked as a hot Instagram model’s post.
Simply put, Verve is digitising good old word-of-mouth, and allowing us to (eventually) capture and reward every recommendation we make.
Today, we announce that we have partnered with Verve and are excited to be leading their latest round of investment. We truly believe they are revolutionising the way our generation will discover and consume new products and experiences — a space that has seen little disruption and which represents a massive market opportunity. The live festival industry alone is estimated to be worth over £20bn, for example, and the team has already proven that word-of-mouth is a scalable and powerful tool in this sector, having sold over half a million tickets globally. Next, Verve will be using their peer-to-peer marketing software to conquer new verticals, such as live touring, sport, travel, beauty, to name a few.
In Callum, Verve has one of the most impressive and inspirational entrepreneurs we’ve met, with an incredible ability to hire and motivate extraordinary talent. He has built a world class management team around him that brings experience from Google, Citymapper, Bloomberg, Deliveroo, M&S, Houzz and many more.
The next time you recommend your favourite travel destination to your friends — just imagine — you could have earned your own return trip back to paradise.
Diana Krantz, Investor at Draper Esprit
