Five Things Startups Can Learn from the Podcast Boom

A growing number of people are listening to podcasts. And as the number of listeners increases, the number and quality of the produced formats is increasing as well. Munich Startup also recently started producing its own podcast (in German). Startups can draw some interesting conclusions from the boom for their own course of action. We put together five lessons.

Podcasts are booming. For the Online-Audio-Monitor, a good 7,500 people across Germany were asked which online formats they use at least once in a while. Roughly one in six listen to podcasts. In our own circle of friends, that amount subjectively seems a lot different. The question ‘What podcasts are you listening to right now?’ has long since replaced other small talk topics such as Netflix series, movies or books when talking with friends, work contacts or your hair dresser. What can startups learn from the meteoric rise of podcasts?

1. The product needs to be fun – or useful

The competition among podcast formats for their listeners’ scant available time is unforgiving: Users only have a limited amount of time to listen to podcasts, for example while commuting in their cars or during their daily subway trip or weekly cleaning routine. Podcast producers have no influence over that aspect. Acquiring a listener usually means some other audio format just lost that listener. The competition is a zero-sum game.

Which is quite similar to the situation for most startups: Market volume is finite, the potential customer base has a limited budget. Which is why the same applies to podcasts as it does to startup products and services: You have to be better, more fun and more useful than the competition – and stay that way. Otherwise you’ll lose your customers as quickly as you gained them.

2. Don’t over-engineer your product

German tinkerers in particular have a tendency to constantly add new features and functions to their product. Cutting-edge technology is used which may only make the product needlessly expensive. And then the big disappointment follows: No one wants the product.

This is where we can once again learn from the podcast boom: In the day and age of complex forms of entertainment, elaborate series and video games with development budgets in the hundreds of millions of euros, voice recordings seem almost archaic. The standard setting: two people talking on live microphones. Editing and production are easy to learn – and people love it!

3. Use the ‘second mover advantage’

Podcasts have been around for more than fifteen years. The name comes from the now almost largely forgotten mp3 player, the iPod. And how long have Germany’s most successful podcasts been running? The Spotify podcast charts are topped by Fest & Flauschig (since May 2016), Gemischtes Hack (September 2017), Dick & Doof (August 2019) and Baywatch Berlin (November 2019).

Sometimes the lead-time advantage doesn’t matter, but rather the ‘second mover advantage.’ Let the others figure out what works and what doesn’t. You don’t have to make expensive beginner’s mistakes. It’s better to learn from others’ errors and to do a better job!

4. The chemistry between people counts

Listening to good podcasts is fun. A prerequisite is for the speakers’ enthusiasm to infect the listeners. Be it a chummy back-and-forth or an interesting discussion – the chemistry between the people on the mics has to work.

The same is true for startup teams. Even cross-functional teams that look perfect on paper fail if the protagonists simply aren’t able to work together in stressful situations. That means: Think long and hard about who you start the exhausting and unpredictable startup journey with. The tool AlignaTeam can be helpful for detecting different approaches within a founding team in advance.

5. Be creative with monetizing

A lot of podcasters have a tough time making money with their work. The number of followers and hits are constantly increasing, but listeners on their own won’t put money in the bank. That means you have to be creative and identify your own trump cards. For example, if you have a specific target group, you could find a sponsor who wants to address that particular audience with a short audio ad in the podcast. There are also professional podcast marketers on the market, such as Julep, who help podcasters find advertising partners. Podcasts with an audience more likely to spend money can collect funds from their listeners on platforms like Patreon and offer extra content in return. Those who have already acquired a big fan base can contact streaming service providers that offer a fixed salary in return for exclusive rights to the produced content.

A combination of different monetization models is often the best path to take. This applies to startups even more so: Be creative, find new ways to make money and look around a bit to see what the competition is doing.