A Darien company has raised $3 million in financing, according to its CEO, as it pursues a Groupon-like model for selling tickets to highbrow cultural events.
Nonprofit Sponsorship Network Inc. listed $1 million in new funding in a December filing with the Securities and Exchange Commission, but the company has commitments for another $2 million according to CEO David Hack.
Hack said the money will be used to support the expansion of affiliate Pavé Life, which aims to provide a searchable index of steeply discounted tickets to symphony concerts, operas and other art performances and venues.
With Wendell Minnick, Hack founded Nonprofit Sponsorship Network (NPSN) more than four years ago on a model of generating advertising revenue through emails issued by nonprofits. In an interview, Hack said the business model has not proven as profitable as he had originally hoped due to the limited number of emails sent out by such organizations to their patron and donor bases. NPSN has less than $1 million in annual revenue today, offering nonprofits that sign up free sponsorship for email newsletters and event announcements, whether issued over Constant Contact or other email publishing software providers. Nonprofits retain final approval of any advertising that goes out in their emails and can opt out at any time.
Companies to this day continue to think outside the box in finding new ways to generate advertising revenue ”“ or in the case of Zadspace Inc., on the box itself. The Norwalk startup”™s business model revolves around generating ads on shipping labels for parcels delivered by FedEx, UPS and other carriers.
Despite the increasing proliferation of dot-coms offering daily deals, Hack says Pavé Life has two major differentiators ”“ on one hand an inherent distrust by upscale arts organizations of having their event tickets sold on platforms also used by pizza parlors, burger shacks and myriad other Main Street businesses, as well as the relationships built up through NPNS.
Still, sites such as Groupon, Living Social and even Priceline.com Inc. in Norwalk offer daily-deal getaways to posh resorts as well, with attendant upscale events presumably to become more available as such sites extend their reach.
Hack is counting on his head start to get to Pavé Life more than $100 million in revenue in a few years.
“Obviously we are not starting from a dead stop,” he said. “We have already created a niche in this space.”
