MarketBeat was founded 12 years ago and is expecting to earn $9 million in revenue in 2019 with just seven employees and a large technical backend.
The company was founded by Matt Paulson in Sioux Falls, SD and never took outside investment. Paulson, who is now an angel investor through Falls Angel Fund, said that it “can be harder to raise funding for this reason because investors are looking for more traction. A startup needs to show their business is viable and earning between 100-250k before they will get the attention of outside investors.” Paulson grew MarketBeat by bootstrapping his business. He explains that when starting a business without investment you need to be prepared for slower and more gradual growth.
MarketBeat was developed out of a personal finance blog called American Consumer News that Paulson started in 2006. During the recession, he posted an article about Citibank and had thousands of hits in under twenty-four hours. He began to cover bank stocks and market news in general, and because of the recession, people were very keen on this type of content. He knew that this was an unsustainable way to build loyalty with his audience because it was based around the environment that the recession created. This led Paulson to launch a newsletter that would be customized for each subscriber to report on stocks that they own or are interested in tracking.
Today the company’s email subscription services are their most popular offering with a forecast to hit 1 million subscribers in the very near future. Paulson stresses the importance of building and owning your own lists rather than relying on Facebook fan pages and other social media accounts as your only means of communication with your customers.
Reliance on a third party puts businesses at risk “because they can change the rules of the game at any time,” says Paulson. Such businesses can de-risk by building email lists, web push notification lists, SMS lists and other audience lists that do not rely on a single large technology company. Paulson notes, however, that SMS will likely become a more expensive service to provide in the future.
Aside from email subscriptions, MarketBeat also offers personalized dashboards to monitor investor’s portfolios, web push notifications, SMS alerts, and has even begun experimenting with voice technology through an app in the Amazon marketplace that is accessible on Amazon Echo devices. The company was able to grow to 250,000 subscribers organically and has since invested in paid advertising to acquire the rest of their customers, investing about $100,000 per month in these activities to generate growth. The company currently captures 2.5% of the market and Paulson sees a lot of room for growth for the company in the future.
Outside of MarketBeat, Paulson spends time investing in his personal brand, writing books, publishing web content, and doing a podcast and other interviews. On top of this, he stays very active in the local Sioux Falls community, sponsoring events like TEDx and 1 Million Cups, as well as launching and operating Start Up Sioux Falls. He mentions that he perceives there to be two strategies when working to grow your business – the short-term and long-term game. Short-term growth consists of your daily activities and strategies to get your next customer. Long-term growth consists of relationship building. Paulson states, “When you build strong relationships in your network you have access to opportunities you wouldn’t otherwise be invited to.”