In a groundbreaking move following its recent $12 million fundraise, subscription management giant RevenueCat has made an unexpected acquisition—Dipsea, an app offering sultry audiobooks. This might sound like a curious choice, but there’s a method to the madness.
Far from steering away from its core mission of supporting over 30,000 app developers, including big names like Notion and Photoroom, RevenueCat’s acquisition of Dipsea serves a calculated purpose. Instead of merely expanding its toolset, RevenueCat aims to use Dipsea as an in-house laboratory to test new features and functionalities, perfectly in line with its “build in public” ethos.
For those unfamiliar, Dipsea creates romantic audiobook content, prioritizing the female gaze with stories crafted by authors and narrators, boosted by ElevenLabs’ AI voice technology. With a robust business model boasting 93,847 paying subscribers and an annual recurring revenue (ARR) close to $6 million, it appears that Dipsea is doing quite well. Just last month, the app generated $505,920 in revenue.
Despite its success, Dipsea faced challenges securing an exit in today’s stringent regulatory landscape. As a loyal RevenueCat customer, this scenario opened an unusual yet promising door for both companies.
RevenueCat co-founder and CEO Jacob Eiting shares his relationship with Dipsea’s CEO Faye Keegan, mentioning how their shared experiences have deepened their understanding of common challenges. This unique familiarity made the acquisition all the more appealing.
Eiting sees Dipsea as an opportunity to operate a live app using RevenueCat’s comprehensive toolkit, thereby gaining real-time insights into the current subscription app landscape. Over the years, the App Store has evolved, and so have the tactics for user acquisition, conversion, and retention. The subscription economy has grown tenfold, and competition is stiffer than ever. Apple’s introduction of App Tracking Transparency (ATT) has also added layers of complexity to the game.
To navigate these evolving challenges, RevenueCat envisions democratizing subscription growth methods, making them accessible to everyone. With Dipsea under its wing, the company will now explore these techniques in a live environment before pitching them to its clients. The app will serve as both a testing ground for new features and a demo for prospective customers considering RevenueCat’s offerings.
Joining RevenueCat are Keegan and her five-person team, focused on continually updating Dipsea as they integrate and experiment with fresh tools. This acquisition not only keeps Dipsea’s mission alive but also provides a treasure trove of data and insights for RevenueCat to leverage.
Keegan expressed her excitement about the merger, noting how it unlocks new potential for both entities. Dipsea plans to tap into RevenueCat’s deep well of subscription growth expertise, ultimately enhancing user experience and developer profitability.
RevenueCat acquired Dipsea in an all-cash deal, finalizing the agreement after months of negotiations. While the exact terms remain undisclosed, the acquisition sees RevenueCat buying out all of Dipsea’s investors, allowing the app to continue its journey uninterrupted.
In the long run, RevenueCat aims to amplify Dipsea’s subscriber base and revenue, using these metrics to validate its success and serve as proof of concept for current and potential customers.
RevenueCat’s VP of Marketing, Rik Haandrikman, humorously highlighted the transparency of their approach. By making subscriber and revenue numbers easily accessible in the demo environment, they embrace accountability.
The integration kicks off with Keegan assuming her new role at RevenueCat in just a few weeks, signaling the beginning of an exciting chapter for both companies.
Stay tuned and watch this space as RevenueCat takes the plunge into the “spicy” audiobook market, turning challenges into opportunities and pushing the boundaries of subscription management.
