Raised in Mexico City, Pamela Valdes says she was a bullied child who was inspired by stories her parents told about other bullied individuals, such as Bill Gates, who later became very successful.
“Those stories my parents told me kind of created my reality,” she said.
Valdes acknowledged that her upbringing was more privileged than some others in Mexico and all over Latin America, people who — in her words — heard stories about the drug cartels in their cities. Those drug kingpins were often the most successful people they knew, and that wasn’t okay with Valdes.
So while studying she came up with the idea behind her startup, Brook. In his first iteration, Brook used tools like YouTube and emojis to create a site and mobile app where people could review the books they were reading.
“I wanted to get Latinos to consume better stories, so I created this community around books,” she recalls. “I thought if I could improve reading by making it social and monetizing it through e-commerce, more content would come to Spanish.”
It worked, to an extent. Before graduating from Y Combinator, the Mexico City-based company actually started as a hackathon project in Austin, Texas, where Valdes attended the University of Texas. The company then raised pre-seed and seed money from investors such as Greylock and Accel. But over time, Valdes realized that while the product worked well for people who enjoy engaging with book content, it was less effective at turning non-readers into readers.
So in 2019 – teaming up with now chief product officer and co-founder, Guatemalan native Guillermo seqeira — Beek was all about audio. The idea was to give Spanish speakers a way to listen to published content in Spanish, but also to introduce them to unique content produced by creators.
Audio made more sense, says Valdes, given that Latin Americans often have long commutes; for them, listening to content while driving to and from work is usually more convenient than reading.
Valdes and Sequeira also realized that while there are 1.5x more native Spanish speakers than English speakers in the world, the amount of audio content available in Spanish is 10x less. Amazingly, there are only 25,000 Spanish audiobooks and 100,000 Spanish podcasts available.
Given the opportunity they spied on, Beek — who raised $2 million in pre-seed funding early on — soon raised $5 million more in a seed round. That money, which the company raised in 2019, should seem like a smart investment in hindsight. In the past two years, Beek has seen his paying subscriber base grow 18x, says Valdes. Meanwhile, 35% of content creators on Beek’s marketplace earn more than their local minimum wage in their first month, she says. “We didn’t expect it, but all of a sudden we became a huge revenue model for makers,” she told businesskinda.com. “They started launching things like mini audiobooks and other premium content in audio.”
The model makes sense for everyone involved, she says. On other platforms like Instagram or TikTok, she said, a creator needs large numbers of followers to make some money. On Beek they can 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 take advantage of a revenue sharing deal with Beek – saving the startup money on marketing costs.
As for Beek’s listeners, it’s often more beneficial to pay $12 per month for one subscription to get unlimited access to numerous creators, such as Haru Escarcega, Roro Ecavez, Regina Carrot and Marguga — than having to pay for access on an individual basis. Today, 60% of Beek’s users are from Mexico, 10% are US-based Hispanics, and 30% are in other parts of Latin America.
To capitalize on the growth momentum, Beek today announced 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 – who has traditionally focused her investments on consumer fintech and crypto – was drawn to a company outside of her usual areas of focus is remarkable.
She found the company so appealing for a few reasons.
First, Bent was naturally drawn to the company’s impressive year-over-year sales growth (8x when it invested). But she was also drawn to the team’s ability to leverage their advisors in a way most other startups don’t see.
“They’re able to get really senior people into their jobs and have them work with them on a daily basis,” says Bent, who joins Beek’s board of directors as part of her company’s investment.
For instance, 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 used to control various KPIs – they had a masterful understanding of leading and lagging indicators, how to build a growth engine and how to mitigate network effects. produce. I normally don’t see this level of mastery of the business KPIs in post-Series B founders and it was seed founders who had taught the entire team to speak this language.
For Valdes, Bent’s investment isn’t as inappropriate as it might seem at first glance.
“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 is working on,” she told businesskinda.com.
Existing financiers Greylock and Accel also participated in the latest round, as well as some new strategic angel investors such as OpenAI CEO Sam Altman, Figma CEO Dylan Field, Duolingo CPO Jorge Mazal, Co-founder of Rappi, Sebastian Mejía, and CEO of Nowports, Alfonso de los Rios. Motivational speaker Tony Robbins also invested through his company IdealabX. “Many ‘makers active on the platform also invested in the round, including Lorena OchoaMexican golf and world champion Oso Travasaid Valdes.
A sustainable copy
Economically, according to Valdes, Beek’s choice of a marketplace model has proved more lucrative than if it had chosen to become a media company.
“We have a network effect between listeners and creators that media companies don’t have,” she said. “In the long run, this creates a better and more sustainable business model to become the ‘super app’ for audio than if we tried to produce it ourselves.”
Ultimately, however, it’s more than the money that drives the company – it’s her passion to help Latin Americans achieve their dreams.
“Most of the content consumed is about self-help, personal development, and business,” she told businesskinda.com. “It is not entertainment content. It is not fiction content. It is actually content that gives them greater possibilities to dream about. And that’s why we exist. We are smart. We are hard workers. We have many opportunities and possibilities… We just need a better story in our minds to dream of greater possibilities. So that’s what we want to do: build a better Latin American dream.”
Beek currently has 51 employees. It plans to use its new capital to build more tools to produce content at scale “so creators can launch more content” on the platform while “ensuring that the experience for listeners 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 improve their lives.”
Janice has been with businesskinda for 5 years, writing copy for client websites, blog posts, EDMs and other mediums to engage readers and encourage action. By collaborating with clients, our SEO manager and the wider businesskinda team, Janice seeks to understand an audience before creating memorable, persuasive copy.