Skillshare Buys Superpeer, a Fan Monetization Platform
RockWater Roundup
RockWater analysis to make you a better investor and operator. Today we discuss Skillshare’s acquisition of Superpeer, the fundraising history of both companies, why learning platform business models surged during COVD, how recent market dynamics have changed, and the increasing consolidation amongst creator tool companies.
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Skillshare bought Superpeer.
Reminds me of the VidIQ / Creator Now deal in January.
Follows the theme of M&A consolidation among creator tool companies.
Let’s break it down…
🎯TARGET: Superpeer
- Tools for online course creators to connect with students
- Feature incl 1on1 calls, livestreams, digital products, newsletters, subscriptions
- “Allows creators to engage with, build, and monetize their communities”
- Founded Mar 2020 by Devrim Yasar and Fatih Acet
- Biz model = 10% revenue share + CC processing fee (formerly 15%)
- $10M total funding
- $8M funding in Nov 2020, followed $2M pre-seed in Mar 2020
- Investors incl Acrew Capital, Audacious Ventures, Homebrew, Moxxie Ventures, Brianne Kimmel, Scott Belsky and OnDeck
- <10 employees per LinkedIn
💰BUYER: Skillshare
- Marketplace of on-demand classes for creative community
- For graphic design, photography, painting, illustration, interior design, et al
- Founded by Michael Karnjanaprakorn and Malcolm Ong in 2010
- 3k courses, 8k instructors, 12M users (Aug 2020 data)
- Biz model = Student membership fees ($8/monthly or annual Teams options), 20% shared back w/ teachers
- $108M funding from OMERS Growth Equity, Union Square, Amasia, Burda, Spero Ventures
- $66M Series D in 2020 by OMERS during COVID growth surge
- 50-200 employees per LinkedIn
🤝DEAL DETAILS
- Price undisclosed
- Appears to be asset sale based on press release “acquisition of key assets and tech”
💸POST-DEAL OPS
- Superpeer’s tools will be integrated into Skillshare over next few months
- Superpeer co-founder/CTO Fatih Acet will join Skillshare, keep building Skillshare tools
- Unclear if any other team members joining post sale
🧐DEAL RATIONALE / SYNERGY
- Create new monetization channels eg 1on1’s for Skillshare instructors
- Become go-to platform for creators to diversify their businesses
- Enable better connection between students and instructors / other students i.e. drive more usage and thus revenue
What else I find interesting about deal… 🤔
Lots of recent consolidation activity in the creator tools space. I explained why in my 2024 State of Creator x Media M&A, in the section titled “Creator Tools and Analytics Face UA Realities”. The learning platform / creator tools space was white hot during COVID when people were stuck at home, and time spent on digital surged (case in point, both Skillshare and Superpeer raised large capital rounds in the second half of 2020 to support growth).
But the capital and operating markets in 2024 have changed. It’s much more expensive to acquire new users, YoY revenue and profit change are slowing / declining, and investors are much more cautious for creator x media businesses.
Another recent deal with a similar profile is VidIQ buying Creator Now back in January (my deal analysis). Like Skillshare relative to Superpeer, VidIQ was larger in revenue scale and team size, had raised more funding, and had been around longer than Creator Now.
My notes on Superpeer’s valuation and revenue growth… ⬆️
Reminder that Superpeer had a second capital raise of $8M in 2020 – unclear if it was a priced round, but would think so considering amount raised and involvement of VC investors vs just angels. So assuming a priced round for 20% of company equity, that’s a $40M valuation ($8M divided by 20%) which was likely hard to grow into as growth got more challenging post COVID surge.
There’s very little info online about Superpeer’s number of hosts and users, so it’s difficult to estimate revenue. What we do know is that their website lists 15,000+ hosts, and the company’s biz model is a 10% revenue share.
So instead, here’s my attempt to back in to Superpeer’s revenue from the size of their last funding round in Nov 2020.
Using directional math, one could assume that the ARR multiple during the SAAS surge in Nov 2020 was over 10x, and maybe well above that for a very high growth company. At a $40M estimated valuation based on my calcs above, a 15x ARR multiple would imply around $2.7M of ARR. At a 10% revenue share, that implies over $27M of gross bookings.
$2.7M ARR seems very high for a company founded in March 2020, or just 9 months prior to this fundraise. So likely, the multiple was higher than 15x, AND the company was being valued off of a run-rate figure like average MRR for the prior 3 month period, since Superpeer was likely very high-growth during the COVID surge.
But like many other SAAS and creator tool businesses, growth has materially slowed since then, and now these companies have to find a way to salvage investor capital and return positive ROI on a significant amount of funds raised ($10M in the case of Superpeer).
To that end, I estimate that 2023 net revenue was likely in the $2-4M range, and growth was flatlining or in decline.
Reminder that neither deal valuation nor structure was disclosed, so I’m completely speculating, but I bet Superpeer was in a similar spot to Creator Now → dwindling cash in the bank, harder to acquire users / grow / make $$, and investors didn’t want to put in more capital.
Of note, Superpeer kept a relatively small team size (under 10 people), so if they kept their marketing and UA spend in check as growth slowed, there could still be some cash left in the bank to be returned to investors.
Also, reminder that the Creator Now deal was all-stock, and I estimated Creator Now investors were able to rollover 80% of their equity value due to liquidation preference protections. Based on the positioning of the Skillshare / Superpeer press release (“acquisition of key assets and tech”), I don’t think Superpeer investors rolled over their equity in this case. But again I’m really speculating here, so pls DM me if you know something I don’t.
Lastly, some context for why I continue to analyze these deals and companies, and am direct about challenging takeaways → I acknowledge that startups are tough, and we’re in a challenging capital markets and operating environment. But only by sharing these lessons, and being transparent about what’s really happening in these creator economy deals and companies, can we all be better going forward, and better allocate future capital for all of our benefit!
What else? 🤔
I wonder which creator tool platforms are next in the consolidation spree…
Another reason to give kudos to Passes for raising $40M in this market (my deal analysis). Not an easy feat, but a chance to be greedy when others are fearful…if you have the execution chops to back it up.
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I’m the founder of RockWater Industries. We do financial and strategy advisory for media, agencies, and creator economy. From M&A and fundraising to consumer research and go-to-market planning.
DM me on LinkedIn or email me chris @ wearerockwater dot com
