Spider Studios
How Vinnie Bharara, Founder of Diapers.com, Found his Passion for Identity-Based Brands
Some Spider Studios, founded by Diapers.com co-founder Vinnie Bharara, passed two key milestones last month. It raised $10 million in additional capital and became a Discover Channel on Snapchat.
In light of these milestones, I sat down with Vinnie to discuss what is next for the media company.
Finding Your Passion
After selling Diapers.com to Amazon for $540 million in 2010, Vinnie Bharara had the greatest luxury. He had the financial security to reflect and ask himself — what am I really passionate about in life?
“Everyone should be asking themselves this question, but — at least for me — it wasn’t until I had financial security that I truly was able to dig deep and reflect,” says Bharara.
What got him up in the morning? Why did he love what he did at diapers.com?
After months and years of reflection, Vinnie realized it wasn’t building relationships with distributors or minimizing inventory cost. It wasn’t even taking on and often outcompeting the giant that is Amazon in a game that — quite frankly — no one had thought diapers.com would stand a chance in.
It was cultivating brand loyalty. It was building iconic, identity-based brands. It was creating a product that — despite higher prices and more limited selection than Amazon — parents would continually use to purchase their diapers because they just loved the brand.
That’s why when Vinnie’s childhood friend and diapers.com co-founder, Marc Lore, went on to launch Jet.com, Vinnie set forth on a different path.
He wanted to continue building iconic, identity-based brands. And — at least for him — there was no more powerful way to do that than building identity-based media brands.
That’s how Some Spider Studios — the parent company over Scary Mommy, The Dad, and Cafe — came to be.
Identity-Based Brands
So what is an identity-based brand?
“When I’m building a brand, I think to myself — does this group have something fundamentally shared between them that gets to the core of their identity,” says Bharara.
“When I’m building a brand, I think to myself — does this group have something fundamentally shared between them that gets to the core of their identity.” Vinit Bharara, Founder and CEO of Some Spider Studios
That’s why Spider Studios’ major brands — Scary Mommy and Cafe — both speak to a specific identity. For Scary Mommy, that is motherhood and, for Cafe, that is social activism.
Before buying or launching a new media brand, Bharara performs a sanity check. He asks, “would customers wear the hats for this brand?”
He is betting that dads, in fact, would wear the hats for a dad-focused media brand. That is why he recently launched The Dad as a new brand within the Some Spider Studios umbrella organization.
But Bharara’s focus on identity doesn’t come at the cost of a focus on market size. At Some Spider Studios, they are focused on identities with a customer universe of at least 30 million. Dads in America with kids under 18 comprise a customer universe of over 35 million.
However, Bharara and the Some Spider Studios team are really betting on the density and strength — not just the size — of each identity they focus on.
Investors often are focused on the customer lifetime value to customer acquisiton cost ratios for companies. If the customer’s value is high relative to the cost of acquiring that customer, the theory goes, the business model is likely sound.
However, Bharara argues that this model often fails to account for the social density of each customer acquired. In a sense, if a customer is acquired in a dense network, that customer’s lifetime value increases exponentially — because each new customer helps drive new customer acquisition for free through their social connectivity.
In the age of social media, the importance of bringing in influencers with tightly knit networks is certainly amplified. “For every individual person you acquire, you’re really bringing in multiple people if you’re focused on these dense social networks,” says Bharara.
Eric Bradlow, the Dean of the Marketing Department at the University of Pennsylvania’s Wharton School, echoes this sentiment. “Companies want to build dense networks where there is a lot of connectivity between members and — also — there are highly influential people amongst their customers,” says Bradlow.
From Bootstrapped to VC-Backed Growth
When Bharara first went into media, he invested his own money — and got some external money from his long time friend and diapers.com co-founder, Marc Lore.
However, after doubling revenue in 2017, Some Spider Studios has just raised a $10 million roud to continue to propel growth. The round was led by NEA, with participation from Red & Blue Ventures, Graph Ventures, and several angel investors.
“I’m especially excited to be working closely again with Tony Florence from NEA, who has joined our Board, and Michael Aronson from Red and Blue Ventures (a fund associated with my alma mater, the University of Pennsylvania),” said Bharara in his announcement of the round.
Both Florence and Aronson were also investors in Bharara’s last company, Diapers.com.
How exactly does Some Spider Studios plan to grow with this injection of cash? First, it wants to focus on continuing to grow Scary Mommy and, as Bharara puts it, make the brand “ubiquitous.”
To Bharara’s point about “wearing the hats” when discussing the launch of “The Dad,” Scary Mommy is also exploring an opportunity to experiment with direct to consumer (D2C) products. This is a unique play for a media company — however, Bharara has experience in the space as co-founder of diapers.com.
Additionally, Red & Blue Ventures has extensive experience in D2C, as they are also investors in Penn-founded Warby Parker as well as more recent upstarts Burrow and Harper Wilde.
In addition to these investments in growth of Scary Mommy, Some Spider Studios plans to invest heavily in its new brand, The Dad. Finally, the company plans to invest in fully integrating Vinnie’s brother, Preet Bharara, into its existing media brand, Cafe.
Preet, the former US attorney for the Southern District of New York, was fired by President Trump in March 2017. During the rest of the year, he piloted a podcast — titled Stay Tuned — on Cafe.com. Vinnie Bharara attributes the decision to further integrate his brother, Preet, into Cafe to the success of the pilot podcast.
A Post-Cable World
While traditional cable TV is in rapid decline, overall content consumption has actually exploded. So what replaces cable TV? Is there even a place for media brands like Scary Mommy in the so-called post-cable world?
As Bharara explains it, the new “cable” — or post cable networks (PCNs) — can be found in the likes of Facebook, Roku, Netflix, Snapchat, and Instagram. Using that analogy, the new “channels” can be found in the likes of BuzzFeed, Mashable, and Scary Mommy. In short, Facebook is to Comcast as Scary Mommy is to CBS.
With that in mind, the Scary Mommy team is excited that — just last month — it became the first child rearing focused Snapchat Discover Channel. This illustrates that Some Spider Studios sees the new-age “cable providers” like Facebook and Snapchat as partners — not as competitors.
Scary Mommy appearing as a Snapchat Discover Channel
As Bharara puts it, companies like Snapchat and Facebook “don’t need average content; they need these iconic, closely knit channels like Scary Mommy.”
Scary Mommy’s monthly unique visitors ranged from 18 to 22 million in 2017. Bharara and the Some Spider Studios team hope that partnerships with new-age “cable providers” like Snapchat will help them grow that number — as well as the number of unique visitors for its other brands — exponentially in the coming months and years.