How Kit Gray Built a $50M Podcast Empire—and Took It Public | Ep 217 with Kit Gray co-founder of PodcastOne
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Because Americans lose when politicians choose. Learn more at GuardYourCard.com. Hey, everyone. Welcome back to Founder Story. Today we have Kit Gray, the president, co-founder of Podcast One, which I've been following for many years. But Podcast One is a leading podcast network. Even NASDAQ under PODC, which is amazing. I cannot wait, Kit, to talk all the things through. How is it to...

uh, take a company public, but I know that podcast one is work with the likes of Annie, Adam Corolla, lady gang, Justin Harbinger, and 200 shows, um, which is incredible. Uh,

So Kit, what was the spark for you that made you say, I want to be an entrepreneur and why this industry? Yeah. Hey, nice to meet you. And thanks for having me today. Yeah. You know, really, I became a fan of really the audio medium back when I was a kid living in Boston and going to sporting events with my dad, you know, dragging me around tennis matches or soccer matches or whatever.

uh, baseball games that I was playing and that, you know, we'd listen to sports talk radio to kind of like break up the, the awkward silence. And, uh, during commercial breaks, we would actually talk about it and have something fun to talk about. And, um, you know, so audio has always had a special place in my heart. And, um,

you know, that, uh, that kind of grew as Howard Stern came into my life and listening to him and then watching him on his TV show and then realizing how he built brands into, uh, both his show and in his radio network. Um, he really was a thought leader in that space. You know, we talk about 360 video podcasts now. Well, Howard did it years and years and years ago. And we

really did an amazing job. And when you look at endorsement radio or endorsement, anything, I knew that was like a extremely powerful thing early in my career. I wound up going to school, not for, you know, anything in the radio or audio space, but I was an analyst. I went to business school, got my MBA in finance and,

And worked in a, you know, in a national security firm in Orlando, funny enough, with, you know, missiles and defense contracts and everything that I'm not about. But I did learn a lot from that experience and

went to Chicago, worked in a bar with some friends after grad school and then decided to take a job in New York City working for Katz Media Group, which was part of iHeart Clear Channel. And what we did was we represented radio stations across the country and then started to pitch why certain radio stations should be on a media spend out of advertising agencies in New York. And from

From there, I really learned the business where the funnel of money from clients to ad agencies, to planners, to buyers, how it all kind of went out. And that was kind of how I learned the business. But I was actually opening an office for them in Los Angeles in 2004, 2005, and I started

I started to listen to podcasts, which back in the day, you had to actually like download a file on your computer, hook up your iPod or whatever device you had for MP3s at the time. And then, you know, you download and drag it over and then maybe add like a tape player in your car where the wires out and all that kind of stuff. And then you could listen to on-demand content. And the reason I loved that so much was, um,

I lived in Los Angeles. I hate the Lakers. I hate Dodgers. I'm a Boston guy at heart. And so basically I had to listen to Boston radio stations on demand that were doing those. And that's what we did. So I would drive and sit on the 405 and traffic going to meetings and listening to my podcast. And I started to think about the medium that I was in and if there was scale that I could start to bring those to advertisers. So,

What I did on my own was there's a guy named Adam Carolla from The Man Show. He wrote for Jimmy Kimmel. He was on Love Line, which was with Dr. Drew, which was national syndicated radio show at night, but also on MTV, which is funny. Dan was talking about MTV and spring breaks and stuff like that where I live. But yeah, so we just started to talk about

Adam did a podcast after he actually took over for Howard Stern on the West Coast for syndication. It didn't last too long, unfortunately. It was a really good show. So he decided doing a podcast and I was listening to that and I reached out to him. We started making some ad deals, right? Where ProFlowers and LegalZoom and Stamps.com and Citrix, we would do reads and we had great return on investment.

based on these tracking codes and I started to build a business. So I started my own company there, started representing Mark Maron, Bill Burr, the Nerdist, CBS News, and creating a network of shows to offer advertisers in 2012 or something like that. And it was really exciting. The medium changed dramatically.

tremendously with the iPhone and being able to download shows and then figuring out what a download is and what's an impression and, you know, targetability and connecting to programmatic desks. And we've created, you know, I sold my company two times now and, you know, I still run it, Podcast One, because I love it and it's a great sell and I love my team and I love the

the shows that we work for and work with. And, you know, it's been amazing. We, we, we, we now do about $51 million in revenue. We're publicly traded, which we'll talk a little bit more about hopefully. And then, you know, we've got about 200 shows and mostly they are really created so they can work for advertisers. Right. But we do,

where we have shows that we've sold to different networks to become TV programs or movies or books. We do merch. We do live shows. We really do everything kind of soup to nuts to help podcasters monetize their

their content. We market them. We do talent booking. We do sales, collections, all that fun stuff to really make sure talented people like the people that you mentioned earlier, the Jordan Harbingers, the Lady Gangs, the Caitlin Bristows, the A&Es, that they can give us more content or create more content that we can tie to advertisers and model shops. So that's our business. You know, we've been on the NASDAQ now under PODC. We've been on the NASDAQ

for about two years and that's a whole different animal. But I would say not as much fun talking to analysts and finance guys. Sorry, guys. But I really enjoy talking to the talent and creating relationships with them. And certainly a very lucky guy in the sense that I get to deal with some of the

funniest, smartest people in the world. So it's been fun. So I'm curious about what you say is very important when it comes to timing. Some of the most successful people that we have spoken to have told me that timing was everything for them, whether it was timing of the idea or timing of how long they stuck it out. These all were very important to the success of the company. How do you feel that timing was since you were so not only were you so early on, but

but you've also been doing it for so long. Yeah, you know, timing is a lot to it, right? And hard work and perseverance and believing. I got lucky in the sense that...

you know, this medium really took off as audio was kind of going this way and still is. This really, you know, put new life into the audio experience and the people that really got behind it really understand how impactful audio is and,

You know, you look at like radio stations and the fact that you'd have, I don't know, six AFN towers and four AN towers in the market or whatever it is, right? Each one is different.

But it's so limited in what programming you can offer, not only, you know, viewers or listeners, but also advertisers, right? And in this case, the internet is, you know, unlimited, right? So you can, you know, do podcasts on, you know, gardening and get an audience and monetize it and make a life if you want. I got lucky too in the sense that COVID happened.

and that was horrible. Obviously, a lot of sleepless nights, stressful times, but it actually helped the medium quite a bit because people were stuck in their homes, a lot of solitude, had a lot of time to watch or consume content. Once that ran out, people started to get into podcasts and a lot of these type of conversations like we are having right now where you're across the country

the country for me, this became acceptable forms of content for people to consume. They didn't care. This is normal now, right? And that timing-wise kind of helped us and it helped the medium. And, you know, three years ago, YouTube got into the podcasting space and, you know, now they're the number one consumption, you know, platform for podcasting and videos exploding and, you know,

you know, so we got lucky there too. Right. So, you know, we, we, we feel, uh, you know, even no matter what your political views are, and I definitely don't want to get into that. Um, certain people in the last election took advantage of the podcasting space and what it offers. And, um, you know, I think Elon Musk on Rogan said it perfectly. When you have a, an hour, two hour interview, you can't hide. And when people get to know, uh,

The person they're listening to, the host, it's tremendous. And I think podcasting, or I know, and I know President Trump would say it greatly helps his opportunity to be the president again. And that's pretty crazy.

pretty cool stuff bro you know a medium that isn't that old and really living um you know that's timing so yeah no i was just gonna bring up these two stats one was youtube being the number one uh consumption place for podcasts but then also a lot of these traditional cable um

shows, they are creating their own podcast now because they see the traditional side of TV, the linear side has been dropping. How did you then navigate the landscape of this being audio focused from iPod to iPhone to phones to moving into social media now and then everyone getting into it? Like you said, I think everyone in 2020 launched a podcast. Funny enough, that's when we launched it.

This show right here is the early stages of COVID. How are you navigating that? And not just the specifics, but as a founder, as a president, how do you navigate the changing landscape? As we know, business can change every five minutes. And if you're not keeping up, your company can be in trouble. Yeah, you know, to me...

And I've had this debate with a lot of companies, salespeople, clients, agencies, you name it. But to me, the smartest companies out there and the ones that are going to win the advertising world and become the Squarespace's, the Ntuckets of the world that started in podcasting and now are in Super Bowl commercials and publicly traded and worth billions of dollars. These are...

you know, companies that understood buying communities. And when I say we're a podcasting company, it's yes, uh, we are. And that's our focus of doing live reads and endorsements and all the stuff I've already talked about. But really when you're a brand and you're buying into a community, um,

um that's where i see the most impact and you know there's a lot of brands that work with a lot of big ad agencies and big companies that you know i'll leave them out of this but um you know when you just start putting money into it and you know selling mass impressions even at a small discounted rate you're not getting what really is going to move the needle in my opinion and

you know, my opinion is if you can, uh, look at, you know, 20 podcasts that have solid numbers in audio, video, social media, um, you put them all together and say to a brand, Hey, I can do this, this, and this, and you can actually do what I tell you you're going to do, whether it's put the state farm pillow in the right spot or the mug in the right spot, you know, get the social media when they need it. Um,

with the backdrops. If you can do that, those are the companies that are going to really win and see great success. So that's what we do. That's why we're different. We go into these big brands and bring 10, 15, 20 like-minded podcasts and bring video, audio, social, mass scale, and then we come through.

and they keep coming back because they're seeing great results. There's always a battle on how much money is going to go to these big agencies and they're going to throw it out on radio and TV and overnights to get low CPMs. And I'm like, well, that's not us. We value...

Our inventory, we value our community. We value the endorsements. You know, I have a lot of clients that, you know, say no to certain brands for whatever reason. And, you know, that's okay, right? Like we will find other ones that will fit better and we do the work that way. So yeah, it's fun, man. I mean, who knows what the next thing is going to be in this space.

But I'm excited about it and it keeps growing and clients are happy. And when you're a sales guy like me, that's a dream come true. Okay, Kit, I need you to sell me this pen.

I remember like that was like the funniest question. I've been to so many interviews where they said that it was like, it was like the, how did this become even a thing? But I am curious, what's the first thing that you sold in your life? What was the first thing that you sold? Well, I mean, first thing, like, geez, it goes back to being like 12, 13 years old and like,

figuring out girls for the first time right and selling yourself right like who you are and like that kind of stuff right so there's that but like um you know for podcasting it was awesome um to be and it's a cool story i think at least um when i went to adam carolla and said um pro flowers cherries berries you know is is on the hook this is like

2012 and they want to do you know a campaign with you and and I told them it's going to be like a thousand bucks to do a read and you know leading up to the to Valentine's Day the media buyers like you're crazy that's more money than K-Rock morning drive in LA so I'm like well

What about doing a CPA, which is cost per thousand thing? And they're like, all right, we'll pay you 12 bucks for every person that uses Adam's code. I'm like, okay, let me see if I can sell Adam on doing it. Talk to Adam and I said, hey, this is what I'm thinking we do it. You

leaning heavy on this. Let's see what happens. I know that if I can get proof of concept here, they've got more advertisers. I can go to more advertisers that'll do things like this and we'll start rolling. And so I got him to do it. And Adam is a tremendous sales guy himself. So he

he's got this great audience that that he could talk to them about supporting the show and you know if you're going to send uh anyone valentine's day flowers uh by the way these mother's day coming up so don't forget um you know so you know just he he i think he got i think when we ended the campaign it was two weeks uh the buyer called me back after uh valentine's day and said i've got some great news i said all right well let's see what is it and he goes

we owe you $43,000. And I'm like, Oh Lord, man, we're on it. So I knew then, you know, that this is a business, right? So he started getting more clients involved. We did, you know, calls where Adam would get on with talent with, uh, with the brands and kind of talk about that too. And so, you know, I think everything's sales, man. I mean, if you're a sales guy or a sales guy, you're selling all, all the time. Right. So, yeah.

That's what it is. So I'm wondering, I think most people would say, I want to work with a celebrity or I want to work with somebody, but I'm too afraid to message them. I'm too afraid to contact somebody who I would think is more important, more special than I am, more known. That is very gutsy of you back then to do that.

And I like how you added value to him versus trying to extract value from him. You added value to him. So if somebody is like, hey, kid, I'm going to message, you know, so and so, because this could change my life. Like what happened with you? How do you think or what would you say to them as to how do I go about messaging this person? Because this this is huge. I am.

I know so many people that would never have done that, but you took the chance. Yeah. You know, we go back to timing, right? Adam had just lost his job at CBS, you know, being syndicated. He was starting the podcast. You know, he had like a fan, like email list. So I'm like, I'll just send it in, you know? And,

He got back within a day and I went in and met with him and his team over in Glendale and, you know, we started doing it and, you know, and nobody knew what a download was or any of that kind of stuff. We just, we figured it out and, and it worked and, yeah.

you know what I would say, you know, there's a million ways to reach out to talent now through Instagram and, you know, all these, all these things that I'm, you know, too old for now, but, but I would say never have any regrets in life, right? Like if you want to do something, go make it happen, you know? And my wife of 12 years now, she, we weren't married at the time when I started the company, but she supported me along the way. And,

you know, gave me great belief in what I was doing. And, you know, that was really cool of her and having a supportive group around, like, so when this happened, and it was stressful, right? Like, after I started building the business, people would start, you know, reaching out to Adam and I'll do it too. And, you know, you're sitting, you know, battling turf and it got a little, you know, crazy. The good news is I, you know, I met some investors that I could

start to take on some money and hire some people and get contracts going and protect my business that I had founded. So back to your original thing though, if you have an idea and you believe in it, go for it, man. You only live once, right? This is it. And I'm one of the few lucky people

living my dream. I love it. I've had a bunch of dreams, but this is one of them. And I really, I still wake up every day and love it. I'm so lucky. You always look really relaxed. You look like you're having a good time. You don't look stressed. So I always did though,

being the president of a publicly traded company and how was the process of taking the company public? So that's not the first time I've heard this about not being stressed, which is so crazy because if you knew me in my head, like I'm, there's a lot going on up here and there's a lot of anxiety and sleepless nights. And, you know, I've got 40 employees and they have families who, you know, there's a lot there, but I try to live it different.

differently. I, I, you know, I'm wearing flip flops and wearing shorts right now. So I don't think I'm your typical, you know, CEO of a publicly traded company. I go into New York and I was at a conference up in, uh, up there and I was speaking at it. And one of the guys came up after doing me, cause that was the most fun presentation. I'm like, yeah, cause I don't do like slides or any of that kind of stuff. I just kind of talk and

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it's a fun place. And he goes, yeah, I feel like you're like wearing flip-flops. And I'm like, if I could wear flip-flops here, I would, you know, like that's, that's just kind of my personality lived in California and, you know, just have that running a public traded company is interesting. You know, we, we,

the company that bought us Live One, which is LVO on the NASDAQ, spun us out their offering into a new offering. And, you know, that was interesting. We worked with...

And then we also worked with the Roth Bank and understanding, you know, the process of going public, how that works, what is entailed in it. You know, the reason why we did it is to make it an all-inclusive space, right, for talent...

producers to really win in it. Right. Like, so even when these big deals come down on Spotify or Amazon, you know, the talent's not getting a piece of it. It's, it's a contract and it's a, it is what it is, you know, for us, when we go out to sign talent or work with new talent, we like to offer them stock. So,

they feel the upside, potential upside of the company, right? So we all are kind of swimming in the same direction together and it's unique. So we use stock a lot of times to help us in some of these deals and, you know, hopefully keep people like Adam and Brendan Schaub and all these guys I've worked with for years and years to stay with us because they're, you know, invested in the company. So, yeah,

Um, that's pretty cool, you know, and, and we're continuing to grow. We have, um, a lot of M and a, uh, conversations going on right now with, um,

a lot of different podcasting companies and non-podcasting companies where we feel we're profitable, which is great. And we feel like we have all the systems in place where we don't need any more backend stuff or really more salespeople, maybe some more producers. But if we take on more scale, that'll help. And if a company comes into us and we can take some of their things like finance and HR and payroll and all that stuff,

off their plates and help them monetize and market their shows that, you know, one plus one will equal three or four, right? And everybody will. So it's been interesting. I mentioned it earlier, you know, I got a chance to talk to people like Whitney Cummings, who I'm going to talk to later today, just brilliant, you know, funny people.

amazing people that are so talented and had so much success in their career. And they're so fun to talk to. And then, you know, then I got a call with an analyst, right. Which is, you know, fun, but different, you know, so it's, it's no offense to those analysts. I love them too. So, you know, I'm an analyst and I think I'm funded to, no, I'm not really an analyst, but an unofficial analyst. So no, this, this has been great kid. I could, I, I,

I'm really fascinated and I'm excited by the fact that talent can now take over and really win versus before they had to work through management and they had to work through. There's so many layers, like you said, in the end, they don't even really make much of the money. It was very little, if any at all. There's always, there's too many people involved, but now they can create their own show. They can have their own asset. They can build a company. I was just,

reading about how a diary of a CEO was offered $100 million to do a deal with whatever company it was, like a Spotify or whatever. And he turned it down and said, they can create a company around what they're doing and make more money than $100 million and how they wouldn't even receive a lot of the $100 million in the end. And I was like, wow, this is very interesting that it seems like the talent now

has almost more of the upside or has more of the control than before, where it really was like these record labels or these, you know, Hollywood studios, like they really had the control and the talent had to bend to them. But this, this has been amazing kit. If you want to get in touch with you, uh, they want to find out more information. How can they do so? Yeah. Uh, happy to take any emails that kit K I T add podcast one. That's O N E.com. Um,

I try to respond to almost everybody, but we, we're on, um, you know, every social media platform and you can go to podcast one.com. Um, check out our shows, listen to the super talented, um, people that have some amazing stories to tell. And, um, you'll find something you like and, um, you know, really enjoy it. But I've, I've enjoyed my conversation with you guys and really appreciate your time today. Same. I know we might've met each other in Orlando many years ago. Who knows? Um,

But it will be an end to your future. But thanks for joining us today on Founders Story. Thank you. Appreciate it. Take care, guys.

Thank you.

to your device, learn what works, and start making more money today. Again, that's at hustle.show or follow the award-winning Side Hustle Show in your favorite podcast app.

For the ones who get it done, the most important part is the one you need now. And the best partner is the one who can deliver. That's why millions of maintenance and repair pros trust Grainger. Because we have professional-grade supplies for every industry, even hard-to-find products. And we have same-day pickup and next-day delivery on most orders. But most importantly, we have an unwavering commitment to help keep you up and running. Call, click Grainger.com, or just stop by. Grainger. For the ones who get it done.