how-does-eventbrite-make-money

How Does Eventbrite Make Money?

Eventbrite is a ticketing and event management platform which primarily makes money via ticket fees (service fees). Thus those are generated when paid tickets are sold via the platform. Those service fees are calculated according to the three levels of services (Essentials – 2% ticket fee plus 79 cents, Professional – 3.5% ticket fee plus $1.59, and Premium). Ticket fees are capped at $9.95 per ticket.

Origin story

Eventbrite is a ticketing and event management platform, enabling users to browse, promote, or even create local events.

The company was founded in 2006 by Kevin Hartz, Julia Hartz, and Renaud Visage as the first major player in the United States event management market. Both Kevin and Julia Hartz recognized that the event ticket industry was plagued by bad customer experience, high fees, and inefficiency caused by a lack of adequate technology.

Its mission is “to bring the world together through live experiences, and since inception, we have been at the center of the experience economy, helping to transform the way people organize and attend events.

As a result, Eventbrite was formed. In the ensuing years, the company has acquired several other ticketing services, including Vancouver-based Picatic and Spanish service Ticketea.

Users can search the platform to attend a multitude of events in categories such as education, music, sport, and charity. There is also functionality for non-commercial events including high school reunions and family gatherings.

Event organizers also have access to tools designed to assist them in event management. This includes page templates and a dashboard to monitor registrations and ticket sales.

Eventbrite mission and vision

Eventbrite mission is “to bring the world together through live experiences.”

As the company highlights “we believe live experiences are fundamental to fulfilling a human desire to connect.”

Eventbrite revenue model

Eventbrite derives most of its revenue from a percentage cut of the sale of an event ticket (service fee). Therefore, the platform does not make money on free events.

For every ticket sale, Eventbrite collects a fixed payment processing fee of 2.5% plus a service fee.

As Eventbrite explained in its 10K:

Our success in serving creators is measured in large part by the number of tickets sold on our platform that generate ticket fees, referred to as paid ticket volume. We consider paid ticket volume an important indicator of the underlying health of the business. We have previously referred to this metric as ‘paid tickets’ and we calculate and report paid ticket volume in the same manner as we calculated and reported paid tickets. Our paid ticket volume for events outside of the United States represented 39.2%, 36.1% and 34.1% for the years ended December 31, 2020, 2019 and 2018, respectively.

The service fee is calculated according to the three Eventbrite plans an event organizer can select from:

  1. Essentials – in the Essentials package, Eventbrite takes 2% of each ticket sold plus a further 79 cents.
  2. Professional – here, Eventbrite takes 3.5% of each ticket sold plus a further $1.59.
  3. Premium – prices are available upon request.

Note that regardless of the ticket price, the total service fee per ticket is capped at $9.95.

Organizer application

Event organizers who want to enhance the event experience can also use the Eventbrite Organizer application. Some of the functionality on offer includes the ability to sell tickets or merchandise at the door and QR ticket scanning.

The app itself is free of charge, but Eventbrite collects a 3% payment processing fee in addition to a service charge of $1 for every transaction. Using the app, organizers can also rent the necessary equipment to run the event with prices starting at $99.

Donation tickets

Eventbrite allows organizers to collect donations for the events they host. In other words, event attendees choose the price they want to pay for admission.

The company will take a percentage of this donation, based loosely on the transaction fee structure described above.

In the case of donations, however, no more than 2% can be charged per ticket sold. Depending on the payment method, a further 2.5% payment processing fee may be added.

The total fee collected for donated tickets is also dependent on the country where the event is taking place.

Key takeaways:

  • Eventbrite is an online ticketing and event management platform. It was founded in response to the expensive and inefficient event ticketing plagued with poor customer service.
  • Eventbrite makes most of its money by taking a percentage cut of each event ticket sold. The exact percentage is dependent upon the plan the event organizer selects. Importantly, the company does not charge for the creation of a free event.
  • Eventbrite also charges for increased functionality through their in-house application. Selling tickets or merchandise at the door and the hiring of event equipment are two such revenue sources.

Read Next:

Main Free Guides:

Related Business Model Types

Platform Business Model

platform-business-models
A platform business model generates value by enabling interactions between people, groups, and users by leveraging network effects. Platform business models usually comprise two sides: supply and demand. Kicking off the interactions between those two sides is one of the crucial elements for a platform business model success.

Marketplace Business Model

marketplace-business-models
A marketplace is a platform where buyers and sellers interact and transact. The platform acts as a marketplace that will generate revenues in fees from one or all the parties involved in the transaction. Usually, marketplaces can be classified in several ways, like those selling services vs. products or those connecting buyers and sellers at B2B, B2C, or C2C level. And those marketplaces connecting two core players, or more.

Network Effects

network-effects
A network effect is a phenomenon in which as more people or users join a platform, the more the value of the service offered by the platform improves for those joining afterward.

Asymmetric Business Models

asymmetric-business-models
In an asymmetric business model, the organization doesn’t monetize the user directly, but it leverages the data users provide coupled with technology, thus have a key customer pay to sustain the core asset. For example, Google makes money by leveraging users’ data, combined with its algorithms sold to advertisers for visibility.

Attention Merchant Business Model

attention-business-models-compared
In an asymmetric business model, the organization doesn’t monetize the user directly, but it leverages the data users provide coupled with technology, thus having a key customer pay to sustain the core asset. For example, Google makes money by leveraging users’ data, combined with its algorithms sold to advertisers for visibility. This is how attention merchants make monetize their business models.

Wholesale Business Model

wholesale-business-model
The wholesale model is a selling model where wholesalers sell their products in bulk to a retailer at a discounted price. The retailer then on-sells the products to consumers at a higher price. In the wholesale model, a wholesaler sells products in bulk to retail outlets for onward sale. Occasionally, the wholesaler sells direct to the consumer, with supermarket giant Costco the most obvious example.

Retail Business Model

retail-business-model
A retail business model follows a direct-to-consumer approach, also called B2C, where the company sells directly to final customers a processed/finished product. This implies a business model that is mostly local-based, it carries higher margins, but also higher costs and distribution risks.

B2B2C

b2b2c-business-model
A B2B2C is a particular kind of business model where a company, rather than accessing the consumer market directly, it does that via another business. Yet the final consumers will recognize the brand or the service provided by the B2B2C. The company offering the service might gain direct access to consumers over time.

Crowdsourcing Business Model

crowdsourcing
The term “crowdsourcing” was first coined by Wired Magazine editor Jeff Howe in a 2006 article titled Rise of Crowdsourcing. Though the practice has existed in some form or another for centuries, it rose to prominence when eCommerce, social media, and smartphone culture began to emerge. Crowdsourcing is the act of obtaining knowledge, goods, services, or opinions from a group of people. These people submit information via social media, smartphone apps, or dedicated crowdsourcing platforms.

Open-Core Business Model

open-core
While the term has been coined by Andrew Lampitt, open-core is an evolution of open-source. Where a core part of the software/platform is offered for free, while on top of it are built premium features or add-ons, which get monetized by the corporation who developed the software/platform. An example of the GitLab open core model, where the hosted service is free and open, while the software is closed.

Open Source vs. Freemium

open-source-business-model
Open source is licensed and usually developed and maintained by a community of independent developers. While the freemium is developed in-house. Thus the freemium give the company that developed it, full control over its distribution. In an open-source model, the for-profit company has to distribute its premium version per its open-source licensing model.

Freemium Business Model

freemium-business-model
The freemium – unless the whole organization is aligned around it – is a growth strategy rather than a business model. A free service is provided to a majority of users, while a small percentage of those users convert into paying customers through the sales funnel. Free users will help spread the brand through word of mouth.

Freeterprise Business Model

freeterprise-business-model
A freeterprise is a combination of free and enterprise where free professional accounts are driven into the funnel through the free product. As the opportunity is identified the company assigns the free account to a salesperson within the organization (inside sales or fields sales) to convert that into a B2B/enterprise account.

Franchising Business Model

franchained-business-model
In a franchained business model (a short-term chain, long-term franchise) model, the company deliberately launched its operations by keeping tight ownership on the main assets, while those are established, thus choosing a chain model. Once operations are running and established, the company divests its ownership and opts instead for a franchising model.

About The Author

Scroll to Top
FourWeekMBA