Media giant Bertelsmann backs subscription start-up Zephr
Written by Rother Radio News on 03/12/2020
A British start-up which helps traditional print publishers increase digital subscription revenues has won backing from an arm of Bertelsmann, the German media giant.
Sky News understands that Zephr, which counts the publishers of The Week and The New York Post among its customers, will announce on Friday that it has closed an $8m (£6m) fundraising.
The funding round is being led by Bertelsmann Digital Media Investments (BDMI), an arm of the conglomerate behind the broadcasting group RTL and the book publisher Penguin Random House.
It is the largest capital injection to date for Zephr, which has benefited from the surge in digital media consumption during the coronavirus pandemic.
Founded by James Henderson, its chief executive, in 2017, the company helps clients to deliver more personalised content and monetise their online audiences.
That shift has become increasingly important to media groups which have struggled to manage the transition over the last 20 years away from print-based business models.
Zephr has won contracts from specialist trade title publishers such as PEI Media, as well as consumer-focused media companies including News Corp Australia and Dennis Publishing.
The company claims to have helped deliver a 150% increase in conversion for clients, and an increase in subscription revenues of more than 25% during a six-month period.
Mr Henderson said Zephr’s aim was to “create a world where every subscription product is tailored to each individual customer; where everyone gets exactly what they want, at the right price, at the right time”.
Among the other investors in the funding round were Knight Capital and Nauta Capital, with additional financing from Silicon Valley Bank UK.
Urs Cete, BDMI managing director, said recent weakness in the advertising market had “increased pressure for media companies to diversify revenue streams and aim to introduce or optimize subscription models”.
“We recognise Zephr’s excellent technology that empowers publishers to galvanise the online subscription opportunity and create customer journeys that are truly unique,” he said.
BDMI’s other investments include The Athletic, the high-profile global sports publisher.
The valuation at which Zephr raised the new funding was unclear.
© Sky News 2020