Thronewhich allows fans to donate items to creators from their wishlist, is launching a new gift portal for family and friends called Happy wish list. However, the most interesting part of the story is that last year, the company returned the money it had raised from investors and went the startup route.
Original Throne
The startup was founded by Patrice Becker and Leonhard Soenke in 2021. The duo previously launched the calendar management app Meeter, which was acquired by workflow automation startup Bardeen.
In February, the company raised $830,000 in a SAFE note from investors including Ryan Hoover’s Weekend Fund, Cory Levy of Z Fellows and Vibhu Norby (B8ta) at a valuation cap of $30 million.
A SAFE note is a way to raise money now and determine the company’s valuation at a later stage, usually during the next round of investment. It’s a popular founder-friendly method of fundraising for early-stage startups that want to raise some pre-seed or seed capital without immediately diluting themselves.
Image Credits: Throne
The co-founders started exploring the idea of Throne when some of their creator friends talked about issues like creating a PO Box, maintaining privacy, and other issues like a limited catalog and delivery issues.
“There was no solution on the market for content creators to securely receive physical gifts. The key issue is creator privacy: The creator’s address cannot be revealed to the fan, so we act as a firewall between creators and their fans,” Becker told TechCrunch.
Throne allows creators to create a wishlist through various sources on the web. Fans can donate items from this list to the creators. Throne ensures that no personal information, such as addresses or payment details, is exposed to any of the parties. The company also allows creators to turn a wishlist item into a crowdfunded gift.
While Throne claims to be a secure solution, the startup’s name has been in the news due to a security bug. Last year, Zerforschung, a German group of security researchers, found a bug in the platform that exposed the private addresses of creators. Throne didn’t reveal details, but said it fixed the bug. It also claimed that an unnamed German data privacy expert “confirmed that there was no data risk”.
The startup makes money by charging a commission to partner brands whose items are gifted to creators in sales. For non-partner brands, Throne charges a service fee above the price of the gift to fulfill the order. The startup passed the 400,000 creators mark on the platform last month.
Image Credits: Throne
Twitch is the most important platform for the company. More than half of the creators signed up for Throne through their Twitch login. Creators can set stream notifications for new gifts or contributions so they can possibly shout.
Refund of investors
Throne CEO Patrice Becker added that Throne had surpassed $1 million in gift purchases for a month with a 50% month-over-month growth rate in 2021 prior to the seeding cycle increase. This led the company to conduct a non-dilutive round.
Finally, in the summer of 2023, the company realized that the market it was targeting might not lead to an outcome supported by the business. While the company was set to raise its Series A, it decided to turn to profitability and returned investors’ money by December 2023.
“We know many companies with limited market size but healthy revenue that could operate profitably — but are ‘stuck’ in the VC cycle. For them, liquidation preferences and investor pressure to deploy the capital they have raised (often creating a high cost base) puts them in a position where they have no choice but to hope for a unicorn outcome,” Becker said.
“We have continued to grow our team as lean and efficient as possible, allowing us to move very quickly and with very little overhead. We were at seven-figure revenue and profitable when we decided to repay our investors in full. We’ve built enough of a safety cushion to feel comfortable paying back the investment before we do.”
Image Credits: Throne
The company also has other products like the Throne Storefront, which is a link-in-bio product for brands like Linus Media Group;. There’s also the Throne Exchange, which is a virtual Secret Santa system that allows users to send gifts to each other without revealing addresses. Becker said 1,500 people around the world participated in the Christmas gift exchange last year. Both these industries contribute a small amount to the company’s revenue.
Open Happy Wishlist
After looking at fans donating items to creators, the founders realized there was room for wishlist gifts in a personal setting as well. The company’s newest service, Happy Wishlist, focuses on wish lists for friends and family. Friends can order items from a wish list at their own address and have them delivered to the recipient physically at an event or party.
Image Credits: Throne
Because friends order items to their own addresses, the startup does not need to be involved in fulfilling the order.
The company tries to make money through affiliate links as well as brand partnerships to get commissions from purchases. Becker said the startup aims to make Happy Wishlist a “multi-million” revenue product within the next year with its monetization strategy. Essentially, Throne is already diversifying its revenue streams — instead of raising money, it wants to make money.
