Hookit Fuels Sponsorship-Starved Amateur Athletes
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the San Diego Venture Group‘s annual PitchFest competition and “parlayed that into our first angel round,” Tilton said.
The company’s original model required members to pay for access. Over time, the site—which officially became Loop’d in 2007—shifted to a hybrid model in which marketing partners pay to maintain a presence on the network. Membership is now free, although a premium option gives users a prominent place on the Hookit network and unlimited access to sponsors and content uploads.
Hookit’s brand partners include some 400 companies such as Monster Energy, which sponsors amateur athletes on Hookit through its MonsterArmy.com initiative. The marketing campaign allows Monster to sponsor serious amateur athletes by lending the prestige of its gear or logo instead of offering financial incentives.
“In turn, they become brand ambassadors for us,” said Sam Pontrelli, vice president of marketing for Monster Energy. “We know it’s working for us.”
U.S. companies invested $716 million in social media marketing in 2009, but that figure will rise to $3.1 billion by 2014, according to data from Forrester Research.
Tilton said Hookit’s commitment to a mix of advertising and branding, coupled with merchandise sales and loyalty programs, has made the firm profitable for more than a year, though he didn’t offer specifics. He said the company adds between 10,000 and 15,000 members a month
Without “explosive, viral growth,” he said, the firm relies on a steady revenue stream to support its operations.
“Our growth has always been 100 percent a year minimum, but it was very linear. We never had an ignition point,” Tilton said. “We just always had a real business. We knew we were monetizing and capitalizing on the brand.”
That revenue stream gave the company runway to survive the global downturn in the economy in 2008 and 2009 and avoid an overreliance on venture capital investment. After raising $800,000 in angel financing in May 2009 from private investors and Southern California’s Tech Coast Angels, Hookit is not in a rush to secure additional venture investment, Tilton said.
Hookit has found the San Diego startup community to be a ready provider of other types of support, though, from the likes of Connect’s Action Sports Innovators group. One of the group’s board members personally invested in Hookit. And the group’s executive chairman, basketball legend and broadcaster Bill Walton, is one of Hookit’s most vocal proponents.
“The Hookit, Scott Tilton story is really what we’re all about here in San Diego,” Walton told Xconomy. “San Diego is the participant sports capital of the world.”
Walton said Hookit’s service of connecting action sports brands to serious athletes was nearly foolproof: “When you have the ability of people to get connected through their peers to get better deals and then the brands able to connect through their targeted [customers], it is really the perfect harmonic convergence.”
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