LiveOne, Inc. (LVO) Earnings Call Transcript & Summary

Good afternoon. Thank you for attending today's LiveOne webcast featuring senior management of its subsidiaries, SlackerOne, and PodcastOne. [Operator Instructions] It is now my pleasure to hand the conference over to our host, Aaron Sullivan, Interim CFO of LiveOne. Aaron, please proceed.

Thank you. Good afternoon, and welcome to LiveOne's conference call and webcast to introduce the senior management of LiveOne's audio division wholly-owned subsidiary. Presenting on today's call are Rob Ellin, LiveOne's Chairman and CEO; Brad Konkol, Head of our Slacker Radio subsidiary; Kit Gray, President of our PodcastOne subsidiary; and myself, Aaron Sullivan, Interim CFO of LiveOne. I would like to remind you that some of the statements made on today's call are forward-looking and are based on current expectations, forecasts and assumptions that involve various factors, risks and uncertainties. These statements include, but are not limited to, statements regarding the future performance of the company, including expected future financial results and expected future growth in the business. Actual results may differ materially from those discussed on this call for a variety of reasons. Please refer to the company's filings with the SEC for information about factors, risks and uncertainties, which could cause the company's actual results to differ materially from these forward-looking statements, including those described in its annual report on Form 10-K for the year ended March 31, 2022, quarterly report on Form 10-Q for the fiscal quarter ended June 30, 2022, and in the company's other filings and submissions with the SEC. The following discussion, including responses to your questions, contains time-sensitive information and reflects management's view as of the date of this call, September 13, 2022, and except as required by law, the company does not undertake any obligation to update or revise this information after the date of this call. I'd like to highlight to investors that the call is being recorded. The company is making it available to investors and media via webcast, and a replay will be available on its website in the Investor Relations section shortly following the conclusion of the call. Additionally, it is the property of the company and any redistribution, retransmission or rebroadcast of the call or the webcast in any form without the company's express written consent is strictly prohibited. Now I would like to turn the call over to LiveOne's CEO, Rob Ellin.

Thank you, Aaron. Welcome, LiveOne. Last Friday, we announced our audio division, its guidance of $88 million in revenues and $17 million in adjusted EBITDA for the current fiscal year March ended 2023. This is a 100% increase in adjusted EBITDA from $8.8 million in fiscal 2022. We also updated our company-wide guidance for fiscal 2023 expected to be revenues of $126 million to $129 million and adjusted EBITDA of $8 million to $11 million, a $23 million swing from last year. We've also announced the company has bought back 2 million shares of stock. And myself and my Board members have personally bought a substantial amount of stock as well. We also recently expanded our relationship with JPMorgan as we continue to look at the process to explore strategic alternatives in order to enhance shareholder value under the current market cap today. With that, I want to introduce 2 of my star executives who have proven not only to be resilient, but have taken acquisitions that we did in 2017 with Slacker Radio, losing over $10 million a year and PodcastOne losing over $5 million a year and these executives, Kit Gray, and Brad Konkol have done an excellent job of managing their teams as well as delivering substantial EBITDA for this year. With that, I want to hand it over to Brad to talk about Slacker and give you a little bit of his knowledge, the team as well as what the -- what we have built over at Slacker Radio. Thank you, Brad.

Thanks for the introduction, Rob. For a quick about me, I've spent a career at the intersection of content, technology and data starting in the academic research sector. And for the last 7-plus years, I've been immersed in the world of music streaming at Slacker and LiveOne. As the Vice President of Product and Engineering at Slacker, teams that report to me are responsible for developing and maintaining our music and video streaming experiences for consumer-facing applications on mobile, web, auto, OTT and other connected devices. In addition, the Slacker team support the tech stack for all business-to-business programs, most notably Tesla. Previously, Slacker Radio powered B2B products such as Samsung, Milk Music, Verizon Tones and ALL Radio. So we really have a rich history of supporting a myriad of applications in both B2C and B2B. In terms of the music marketplace and where we are as a business today, global music streaming revenues are forecasted to hit $89 billion by the year 2030. So we're in an industry that's set for continued substantial growth over the next several years. For Slacker's part, we've recently surpassed 1.7 million subscribers. In addition, we've grown our free members to nearly 800,000 on our ad-supported tier. We expect to have 2 million subscribers by the end of our fiscal year in March. For those that may not know, the Slacker music experience really specializes in lean-back radio that is expertly curated by humans while still incorporating algorithmic logic to support personalized listening. So what we mean by lean-back radio, the user doesn't necessarily have to make a whole lot of selections or inputs in order to get a listening experience that they can enjoy for hours on end. And we believe that a big part of this is our hybrid approach of human curation with the AI. On top of that, we add voice and narration and storytelling to our music experiences to make a deeper connection with our audiences. In fact, we remain the only interactive radio service with DJ and on-air personalities integrated into the listening experience. In that regard of combining music with voice, we're going to continue to integrate PodcastOne content across our applications, including on Tesla as well. In addition to all those things, we're very competitive on pricing. So we truly feel that this combination of lean-back, ad-free streaming radio with a personalized and connected touch at consumer-friendly pricing, we believe that's unique and that there's B2C customers as well as B2B partners that are looking for exactly that. So again, the team at Slacker, we're incredibly agile, and the tech we built is a major asset for the company. Over the last 5 years, the team has taken the core audio product for music, and we've integrated video, interactive live streaming, linear channel streaming, podcasting, pay-per-view and most recently, we launched a digital Meet & Greet product. In terms of where we're going, we believe all the aforementioned products and content verticals can continue to drive revenue, and we see business-to-business partnerships as a major potential driver for growth. We believe there is substantial opportunities with businesses looking to bundle services and provide their customers with additional product benefit in the form of music. So really building on recently announced partnerships with the likes of ZYNC and TCL and continuing to expand with programs across a number of verticals such as connected health and fitness, telecoms, property management groups, consumer electronics and automotive initiatives. So we're very enthusiastic about focusing efforts on these areas going forward, and we believe they present truly exciting growth opportunities for the company. And with that, I'll throw it back to you, Rob.

Great. Thank you, Brad, as always. Brad and his team -- Brad and his team has not only proven to be resilient. He's had to make some really tough decisions, including making major cuts in the overall team to make sure that we get to the substantial EBITDA. But as get as I've articulated publicly, right, we've now gone from over $10 million in losses, 400,000 subscribers, we've grown to 1.7 million paying subscribers and over 2.5 million total and over $10 million in cash flow. With that, I'm going to hand it over to Kit Gray, and Kit has done an exceptional job the same over PodcastOne. Thank you, Kit.

Thank you, Rob, and thank you, everyone, on the call for your time today. My name is Kit Gray. I'm the President of PodcastOne. I will give you just a brief background on myself. I started PodcastOne in 2009, working with the guy that we still work with Adam Carolla and we were really one of the first people to put ads into podcasts. And it's been a tremendous ride ever since then, and it's been about 12 or 13 years that I've been in the business. My background comes from working for iHeart in the CAT Media world where I represented radio stations, opening offices in Los Angeles and Boston, Massachusetts working in New York City, getting really a grasp for how the advertising, planning and media buying world goes and that was a great foundation to my current career. I have been in the space for 12, 13 years, I've been running PodcastOne, just myself for about 2 years now, took over from my old partner and Westwood One Founder, Norm Pattiz. And it's been just a great run with the LiveOne acquisition a couple of years ago and putting some new resources and seeing some great growth. Just to talk about the industry, which is just expanding tremendously. I was just down at the podcast movement in Dallas 2 weeks ago where there are a lot of exciting things going on. I'll talk about a few of those right now. YouTube is now getting into the space and will be one of the key drivers of distribution, discovery and monetization that's an exciting opportunity for growth for our podcast to get bigger numbers and to sell integrations and to continue selling video and monetizing that sort of content. Also, we've been reading in the advertising bureau. The IAB has just posted over the last couple of months that the industry did just over $1 billion last year and is on path to do about $4.5 billion by 2024. So the industry is growing tremendously, and we're moving in the right direction. Just this morning, we -- there was a report out from Edison Research and Sounds Profitable talking about engagement with podcast listening and how their attention to advertisers and how podcasting is superseding all other mediums when it comes to accountability, recognition of the ads and really put some great data in why media companies and advertisers should be putting more and more money into podcasting. That type of data continues to be strong even as the economy is seeing some hiccups. People are spending more in podcasting just based on results. And there's different forms of attribution that get great ROI metrics and help the medium kind of move forward. Moving on to PodcastOne and our growth. There is a ranking service called Podtrac, where you can go on and see the top-performing podcasts individually as well as networks. You'll notice that PodcastOne is ranked in the August ranker #8. The growth from July and just unique went from 6 million to 7.2 million, which is tremendous growth and very exciting as we continue to grow as a network and offer more different type of programming and opportunities for advertisers to be involved with that. Our show list continues to expand. Just recently, we launched A&E's ninth season of the hit podcast cold case files. In the next month, we will be launching A&E's other hit podcasts for Season 2 I Survived. We are well positioned in the housewives world with Melissa Gorga, who has launched with us this year, and she's growing tremendously over the last 3 to 4 months. And Teresa Giudice will be starting with us in the next month or 2, and we're really excited about that as well. In conjunction with WTOP, owned by Hubbard Broadcasting, one of the top radio stations in the country out of Washington, D.C., we are starting the third season of a hit podcast series called 22 Hours: An American Nightmare, just keep an eye out for that. And we just recently acquired ActionPark Media, which has the Kelly Stafford podcast as well as the Victory podcasts that works on the Entourage series and talking about that great TV program. So our network continues to grow with new programming and new offerings for our advertising partners and our salespeople to go out and sell. I wouldn't be here without talking about the strength of the PodcastOne team. I am fortunate to have really what I believe a team that's second to none or a talent acquisition team are just fantastic. We've got a really, really exciting slate of podcast that are due to be signed and launched over the next 6 months. That's in the 10 to 15 range in terms of programs for that. Sue McNamara is my right-handed woman, and she runs our sales team. She is -- comes from the CBS world of selling Howard Stern over the years and working in interacting CBS Radio. She's been with PodcastOne for the better part of 4 years now and leads our great sales team that has sellers all over the country. Alana and Jackie run our marketing. And once we get these programs on board, we see significant growth in our engagement with their communities, and that's very valuable to recognizing revenue. The production company that -- a production staff that includes some of the best out there with Alter Wolford leading the way there. They've been with us for a couple of years now. So it's really a great veteran team that's positioned well to succeed moving forward. One of the great opportunities we have with us right now is really looking at the shows that are making the most money and making sure we're focusing on growing those shows and putting as much sales resources into those and helping grow our margins in a great way. Any shows that really aren't making us money, we're able to move on from them, acquire new shows, and that's been a great experience over the last 3 to 6 months where even the ones that we lose, we're sometimes sorry about that, but better opportunities are right around the corner, especially with the growth in the medium and maybe some of our competitors not focusing as much on those programs as they should be. So it really brings a great opportunity to us. We continue to expand in the 360 sales offerings and working with Slacker Radio and Bradley and his team to bring live show content, experiences with some of our community members and our talent to have exclusive relationships and interactions with talent on a different level, merchandise and more. So that's an exciting way for us not only to engage with those communities, but to bring different revenue channels to the PodcastOne world. That being said, that's really what's going on in the podcasting world. We continue to strive to move forward. We're really excited about the future and our new programs. And as we continue to grow, it's a really great place to be, and we're excited about working with Slacker more and doing some great things and moving the business forward. So thank you very much for your time and looking forward to any questions you may have.

So Rob Ellin, just to finish before we go to the Q&A. As you can see, this is a very seasoned team. This is a very humble team. Kit has just done a magnificent job of helping me to close an $8.1 million financing at a $68 million valuation for our podcast business. We just announced record revenues for the quarter of $8.7 million. And as you look at the 2 divisions coming together as our audio business, again, over $88 million in revenues and $17 million of EBITDA from true turnarounds, restructurings when we acquired these companies. I couldn't have been prouder of my team, and I couldn't be more excited about where we're going in the future of this, and we're excited to start talking about very serious cash flow in calendar 2023. So any questions, any Q&A, I'd love to help the team answer any questions you have for Brad, myself or Kit.

[Operator Instructions] Our first question comes from Brian Kinstlinger with Alliance Global.

This is [ Shervin ] calling in for Brian. I just had a couple of questions. Starting with PodcastOne, that $8.7 million of revenue during the first fiscal quarter, what was the implied year-over-year growth rate for that business? And then with the recent pressure on the economy, and we're hearing in some cases on advertising budget, what is the impact on your ability to sustain or accelerate the growth rate of this business?

Brad or Aaron, do you want to take the first one on the finances, and I can talk about the economic side of things. Real quickly, I'll address that. The advertising model is really strong with podcasting. You're going to see some drop-off in the advertising spends and some of the other mediums like we talked about TV, digital, radio, print, you're going to see some drop-off with the economy and distribution and supply chain management. That's been an issue. With podcasting, you're going to see a little bit of that, not as much. And that really has to do with -- the core of the business is still very much on the ROI world where we call it direct response business where you have to use the code or go to a website and there's all these attribution companies, whether it's charitable or pod sites or other companies that are getting into that where advertisers are seeing direct results based on their spend that in their world, they have to buy that real estate and make sure they're in that place just to keep those successful campaigns going. So we're not seeing as much as I believe you'll see in other mediums.

And just to add a little bit to that, just, Kit, if you don't mind, just talk about the TAM and the growth of podcasting today and podcasting over the next 5 years, where the revenue growth is going for the overall industry?

Yes. What the IAB is saying is we did just over $1.4 billion, I believe, in -- yes, it was $1.448 billion in 2021. They're projecting to grow to $4.229 billion in 2024. That comes with a bunch of different reasons. The direct response business is still by far away the leader in the space where there's a couple -- probably 3 or 4 different agencies that run that world. You typically see that as a low-cost medium in TV or radio, but for podcasting based on the results and the attribution, they'll sometimes pay the highest CPM. So as you see more great content and more consumption of podcasting in general, as an industry, you'll see more money spent into that space. You're also going to see a lot more brands, very weary of how they're spending their dollars, and that also leads to the strength of podcasting and that medium as well. Specifically, for PodcastOne, we continue to grow. I mentioned the growth in the unique from July to August on the Podtrac ranker. That's just what we do. Every day, we come in and we market our shows to grow those audiences and then we work with the talent to grow those audiences and push them socially, push them through other podcasts that we have available inventory in and that effectively helps us sell higher rates and higher numbers and more money. So that's the name of the game. We've got a great team and a great model at PodcastOne and we've been able to show significant growth in the network over the last 1.5 years or so.

And when you think about that TAM, right, and going from $1.4 billion to $4 billion, right? And I think overall, we believe it's going to $10 billion over the next 7 or 8 years. One of the exciting parts of this is, you're seeing even in this current market climate, one of the reasons we believe that it made sense to do the financing of the PodcastOne and take it public on its own is that the valuations companies are getting bought even in the current market environment. Sirius Radio, just bought a podcast network, its 15x revenues, right, network doing $10 million in revenues. We're doing that -- we're doing almost $9 million per quarter. So it's a really exciting time to be in a market with this type of growth.

And then what was your implied year-over-year growth rate -- the implied year-over-year growth rates for PodcastOne, if you guys had that.

Aaron, do you want to take that? I think we can only give quarter-over-quarter because I don't think we've broken down the year yet, right? We've consolidated the 2, but we haven't given the year. But Aaron, why don't you just give them a growth rate from the $8.7 million versus last year.

Yes. It's just north of 15%.

Great in the quarter.

That's for the quarter. Correct. And just -- sorry, just to clarify a little bit. There is some seasonality in the quarterly rate. So the biggest quarters are Q3, which is the quarter ending December. So just want to point that out.

The next question, keeping with the podcasting, how do you think about the portfolio of content and need for brand-new podcast? And then can you talk about the capital requirement you expect for the content growth?

Kit, do you want to take the first part.

Sure. Yes, no problem. I'll take the first part. Yes, our lifeline at PodcastOne has always been refreshing our content chain line. It basically -- it's very important for us to always have something new to sell. We always flush out the bottom part of our roster with new ones potentially. It's really important for us on a margin side too, right, as we do launch shows, we were able to have better revenue splits and things on the like that versus ones we may have had for years and years. So it's really important for us to continually put new programs out for consumption as well as sales opportunities and margin growth.

And talking about the capital needs and Kit jump in here just to add into it, there's very little upfront capital in this, right? There's a microphone and video and so on as we expand those. And there's so many revenue streams that could come off the same piece of content. And what Kit has done is we threw them in the trenches, of literally changing out Chairman, COO and CFO as we acquired the business. Kit is the Founder and President of the company, has stepped up and just done an exceptional job of driving those revenues on a run rate to almost double them from where we acquired the company as well as really refocused the energy around margins and EBITDA. And so we're really proud of where we are right now, and we look forward to highlighting that in this next quarter coming up. We announced $2 million of EBITDA last quarter, and we expect this quarter to be substantially higher as we've stated, $7 million to $11 million. So we look forward to highlighting that in as you see the filing for the IPO. If you read the 8-K, it said the IPO has got to be at $150 million or more, which is well below the industry numbers, right, substantially below and almost 60% above our entire market cap just for the podcast business. So Kit has done a great job of it, his team has done a great job, and I think we'll be able to highlight and showcase a lot more of those individual numbers very shortly as we file that IPO.

And then one last question on Slacker Radio. Can you remind us of the strategy to improve the conversion rate of members to paid subscribers. And again, back to the weakening economy, are you seeing any slowdown, excluding new Tesla sales?

For us, we have the lowest churn in the industry. We're not in the business of going out and spending a fortunate on marketing and spending $80 a sub to see if you can keep your subscribers, right? We're about super fans, right? And as Brad articulated, because of lean-back experience and because of our B2B deals, right, we don't have that same issue that most of the industry does. We're nimble, we're way lower priced than anybody else in the industry. And Brad, do you want to add anything to that?

I think you're touching on the key points, Rob, and I think that's really focusing on the type of consumer that aligns with what we think we do best. And it's that lean-back listening at the ad-supported pricing tier, which we can offer at a very competitive price. So I think in terms of B2C, that's focusing on those customers that align with our core product principles is where we're going to see the best conversion. As Rob said, we're really focused on mitigating churn as well, which we've done an exceptional level compared to historical churn rates. And again, where we see a lot of growth is through partnerships. And that could be through affiliate programs and things where partners that have similar value-conscious customers help promote our brand as well. So we see there being a lot of synergy there in the months ahead.

And you're going to see very similar more and more deals like TLC that we just announced, like Android Automotive, like we do with Tesla, where we could be life labeled, we can build -- the app can be built into these transformative partnerships that have 10 million to 2.5 billion eyeballs like Facebook. And our humble opinion is everybody needs music, right? Everybody needs access to it. And you've seen the growth in the size and mass that has been created at Apple and Spotify, Amazon and YouTube, right, and Sirius Radio and iHeart. We're in that very fortunate position that because our team has built the technology stack to give you a really unique offering at an extremely low price. It gives us a lot of flexibility in how we can partner on those and really achieve our goals, utilizing our B2B partners that have this massive traffic and leveraging their traffic and exchange for this world-class content.

Yes. And I think to answer the second question there is really about the economic state. Music in general, I think, is a really resilient entertainment medium. But in a lot of ways, our core experience is tailor-made for value-focused consumers looking for good music experience at an affordable price. So I think we're well positioned based on the current economic climate.

Our next question comes from Scott Redmond with Redmond Asset Management.

I was wondering just kind of as more of a thematic or possibly historic or recent history, what is the typical merger of cultures of a podcast network like, I mean, on one hand, it could be as antagonistic as the Yankees merging with the Boston Red Sox. On another hand, it could be like Kindred Spirits who just kind of joined together. And I guess the third way might even be that here the computer codes to our feeds and the acquirer is no longer needed. Can you speak to just the dynamics of integrating new podcast groups? And have there been any bad mergers out there, things like that?

Sure. Scott, nice to meet you, and I hear you when you come through a Red Sox, Yankee, you had been a Boston. So I get your -- and I think we're playing tonight. So I get it. Go Sox. Exactly. All right. I like it. Yes. So look, when it comes to podcast networks and putting them together, it's really best talent management. I look at my -- I learned really everything from a guy named Norman Pattiz, who is the best I've ever seen when it comes to managing talent and understanding their position and how to work through certain situations. So I give him all the credit and I learned I went to his business school basically in talent management. So what I would say is every piece of talent is different. And everybody looks at their business, which is really what the podcast is it's their business, and that's one of the things that makes it so attractive for talent is that they own it. They have control over it, and it's really important for them to have a comfort level and the people that they do work with. So fortunately, I've got an amazing team and really an amazing network. So when we take on a new show, it's very important for us to sit down with talent, look them in the eye, tell them what we expect and tell them what they're going to get from us. And sometimes, there are certain people that rivals in a way. And I'll stay clear of some names, but I think you could guess if you look at our roster -- there's definitely some in there. The benefit of being part of a network is that you get this cross-promotion, you get these resources that you wouldn't get -- and really, the key is being able to package a bunch of these shows to advertisers to offer scale. So that -- those benefits outweigh typically any friction you may see. And really, it makes it a win-win for everybody involved, right? So part of our model at PodcastOne and it makes us very unique is that any unsold inventory is available for promotion of our podcast. So there's a lot of host doing reads for other podcasts. There's a lot of guests guessing on certain podcasts really just being part of a bigger family for lack of better terms, really the benefits far away, the negatives of these small interactions or disputes you may have. They always occur. And usually, that entails me getting on the phone with some people, but it usually ends up in a win-win for everybody.

Okay. What if you were -- go ahead. So like let's say you were going to hire or join forces with, I don't know, like the #7 or #6 or #9 or #10 podcast network out there. Is there an expectation is how those things go? I mean, Sirius just made a large acquisition. And I'm thinking about integration of the 2 networks.

Yes. Like we just acquired -- or have a representation deal in place with ActionPark Media Group, which has the Victory podcast and a couple of other podcasts. And that's really a seamless integration and it really comes down to communication and talking to people about, hey, this is what we do. This is why we do it. And this is how this is going to benefit you. You can say anything in the world that you want, but really coming through and doing what you say you're going to do is the key to that. And we continually do that. We have success metrics and transparencies that all our hosts want, whether it's sales transparency, marketing, transparency, any of those things. It's all -- it's all about communication, talking to people, listening to people and working through those situations. There are -- really, when we've had an acquisition, it's been a great experience for the most part because we're bringing something that they don't have, whether that's sales resources, marketing resources, promotional resources and most importantly, financial results, and that's been proven over and over again, and we continue to do that. And if we have any hiccups along the way, we talk it through. We come up with the issues and then we solve them together.

Our next question comes from [ Cliff Weinstein ], private investor.

I guess this question goes to Rob and Kit. When you think about the spin-off of PodcastOne from a shareholder value perspective, can you walk us through the thoughts behind it? I know it's not filed yet, so we don't know the exact structure, but could you maybe lay out how you're thinking about it? And why you believe it will create shareholder value, both at the parent and then Kit, if you want to talk a little bit about what being an independent public company on the podcasting side does for the business. That may be helpful as well.

Sure. I mean, there was tremendous value opportunity here in that we closed our financing at a $68 million post-money valuation when our market cap is a total of $80 million right and podcasting is less than 30% of the revenues of the business, so I would say, number two is it gave us an opportunity that we will shortly dividend out shares to each of our existing 15,000-plus shareholders right at LiveOne, we'll get -- participant patiently in the second public company. Number three, is it was off-balance sheet financing without a dilution to our shareholders right in the public company. And number 4 is it gave Kit and his team, which is an exceptional team with experience literally building the podcast industry, right? And we're one of the few independent networks left that Kit and his team had the opportunity to really grow and build and be able to, as the gentleman before, brought up, like be able to acquire other assets, right, with both stock and cash, right, as well as bringing top talent like utilizing equity in that public entity. And I really find it super exciting. And as I said in the 8-K, if you read it, the 8-K says, the IPO has to be at $150 million or more. $150 million seems awfully cheap when you think that Sirius Radio just paid 6 weeks ago after the market collapsed, they paid for $10 million in revenues, they paid 15x revenues. And that's sort of the low end of the range, Spotify, iHeart, Apple, Sirius, have all paid for these assets because of the growth in TAM and how big this marketplace is. So I think that's the big opportunity. And with that, I'll hand it back to Kit this deal to him having some of the flexibilities and freedoms and continue to build his community and what he thinks he can do with it with a separate public company, right, even though it will all be part of public the parent company as well. Go ahead Kit.

Yes, sure. No, good question. And Rob, a good answer. I think this will be really the only pure-play podcasting company out on the public marketplace. And if you go to a dinner party or a holiday event and you're lacking something to talk to someone about just ask him what podcast they're listening to. And there's just huge passion in the fan base on podcast. And I believe with that opportunity for people to invest in the medium, unlike anybody else gets to do, that's really exciting for the community as a whole. It's also really exciting for us at PodcastOne in the sense that we'll have some more capital to acquire the right partnerships in terms of talent acquisitions, whether they exist now or launching new programs that we're really excited about. It gives us an opportunity to have good margins and really good bets on what programs we think are going to work. We have really a scientific method on how we look at programs and really can hedge our bets on our acquisition strategy. So this is -- this just gives us much more capital to go out and be aggressive on the shows that we want and grow faster, right? So that's on the network side of things. And when it comes to advertisers, that's exciting as well. I think we had some 300 advertisers, maybe more last year. And we're pushing somewhere close to the 500 range this year. So as our network grows, with more listeners and different genres, we'll be able to acquire new advertisers that have not been in the space and kind of go that direction. So that's why this whole thing is very exciting for people at PodcastOne.

Got it. And just one follow to that.

Yes. Just the last part to that, [ Cliff, ] is our pipeline is the largest it's ever been in the history of the company, both from podcasters looking to move over to our network as well as to sponsors looking to join our network.

So you may have touched on this before, Kit, I apologize, some of my questions were asked previously. But when we think about acquiring and having existing podcasts during your platform, can you just give me a 30-second reason why if it's longer than that, that's fine, too. And if you touched on it, I can go back and listen. But can you just walk me through and investors through why the talent and shows would join a PodcastOne versus the Spotify or Amazon or Sirius or whatever it may be of the world? What's the advantage you bring to the talent?

Yes, no problem. I would start off with we're a podcasting company and only a podcasting company. When you look at some of those other competitors who mentioned podcasting is just a small piece of what they do or it's something they're just getting into and trust me over the last 12 to 13 years that I've been in this space, there's so many mistakes you can make. And we just try not to make any of those mistakes again, right? So we know our model, we see what works. And you look at some of our shows and our relationships, you'll see that -- many of them have been with us for 6, 7, 8 years. Many of them recommend PodcastOne to some of the people they know in the space. So that's a big deal to have some of our current podcasters go out and say, "Hey, we love the relationship with podcasts on everything that they do for us? They can do great things for you, too. So a lot of the ways we actually acquire new programs is based on that referral program. So like I said, we live in the podcasting space. We've done this. We're longer than really anybody else. We do everything. We do everything from hosting to ad serving to talent booking to tech to social strategies to sales, collections and more. So we're really a full-service operation unlike anything else out there and that's why we ask for more. That's why we don't live in the 80-20 rev share split deals. We shoot for 50-50 to 60-40 in that world because we know we deserve it. We have a proven success rate of growing podcast not only in the audience side, but also the monetary side of things. And it's proven over and over again, and we can back it up with just some great case studies from some of our great podcast partners.

Got it. And Kit, one last quick question for you guys.

Just one second, Kit. Let me add one more thing to that. Even though we compete with Spotify, talk about our distribution for a minute, right, which includes all those competitors.

Sure. That's a great point. So we're everywhere and anywhere you can consume the podcast. We do not have any limitations on how our content is distributed. Some of our other competitors keep it just to their platform. We do not believe in that. We want as many people to discover and listen to our shows as possible. Most importantly, we have the control of the advertising inventory of those shows. So the more people we can get listening to the podcast wherever they are, however they listen is beneficial to us and unique. One of the other things that we do is, we sell differently. Some of our competitors just do dynamic ad insertion breaks and using that technology to create ad, we don't just do that. We do live reads that are embedded in the shows that live for a certain amount of time. We do dynamic ad insertion for geo-targeted and time-sensitive campaigns and use technology to our advantage to help with delivery. We do segments, right, where you can do a minute, 2 minutes, 3 minutes of content around a brand and a piece of content that makes sense. It's really a blend of old-school radio, Stern-type style to new technology, digital medium, and we've really blended both of those unlike anybody else out there.

Got it. And just last question on podcasting. How do you think about breaking out like breakout new shows? Like I'm just trying to think behind the scenes, you guys are now better, but the Joe Robin, list goes on and on about, these just monster shows that because there is that great? Or is it by design is a lot of money invested into those shows to make them what they are. Can you just walk me through how you think about the potential next breakout show and if it could be on your platform and how you kind of view those monster shows?

Yes. Look, I think those monster shows are great programs. And we're probably leaders for those organizations in the sense that they threw out big money that you really can't make back just based on advertising, which is our core model, but they have different reasons for doing that, whether that's a subscription side of things or whatnot. That's not our model. Our model and what I like about our business is taking shows that have a good number, and we can then take it to be a great number. And then in turn, with our sales strategies, our monetization strategies and really have our relationships with brands. We're able to go above and beyond to get really high CPMs and for lack of better terms, to say get more out of the shows based on just the numbers that they bring to the table. It is helpful in that sense because we can create relationships as people grow up and get bigger and tie into different aspects of the business, whether it's Merch live shows and other things. So it makes it harder for them to leave down the line when they get big and get big offers from other companies like Amazon and Spotify that will throw money out that may not make sense, right? So how I think about it is, again, I think with the iHeart and the Spotifys and those groups, they might not prioritize some of the shows that we see really great value for. Again, I referenced an article that came out today from research basically from Sound Profitable and Edison Research where they talk about the value of shows in the 500 to 1,000 range, having more reach than your top 10 podcasts which is great news, right? It really means that buying deeper on a rank or per se and just buying scale in the podcasting space is more valuable than just buying those big guys, right? And you might overpay for those big guys. There's not as much ad inventory for those big guys, but it doesn't mean you cannot take advantage of the great space for advertisers in the podcasting media.

There are currently no further questions in queue. [Operator Instructions] There are currently no questions in queue. So I will pass the conference back over to Robert for any additional or closing remarks.

I just want to thank everyone for joining, and we look forward to announcing our second quarter and continue to grow top line as well as our EBITDA. And thanks to you, Kit and Brad, as always, for doing a great job and talking to the audience here. And you're going to be hearing a lot of their voices going forward. You'll hear from our other 5 subsidiaries very shortly as well. And as we continue to grow those laser-focused on EBITDA, bottom line and cash flows for the company going forward. So thank you, everyone, and I appreciate your time.

That concludes today's LiveOne webcast featuring senior management of its subsidiaries, SlackerOne and PodcastOne. Thank you for your participation. You may now disconnect your lines.