Tim Fung, CEO of Australian outsourcing company Airtasker says in a time when a lot of businesses are economically getting on the defensive and taking a step back, it’s a time for his company to be on the front foot.
Speaking to Mediaweek following the announcement of Airtasker’s $6m media partnership with oOh!media, Fung said that for the last two and a half years, the company has been focused on profitability, not marketing.
“We have had a marketing budget of less than $2 million per year, over the past two and a half years or so. We have been incredibly lean,” he said.
“We’ve been able to maintain prompted brand awareness at about 64%, and that’s been incredibly stable over the last two and a half years, even though we have leaned down on above-the-line brand investment.”
Airtasker provides an online and mobile marketplace enabling users to outsource everyday tasks, and Fung says it’s oOh!media partnership will give the company huge firepower to invest in not only prompted brand awareness, but he thinks even more importantly, unprompted brand awareness.
Tim Fung, CEO
“It really is a brand where if you realise you’re bathroom is messy, or when you need a repair to your roof, or if you’ve got a drone stuck in a tree, then we want Airtasker top of mind.”
The terms of the partnership provide Airtasker with $6m in oOh!media inventory in exchange for a 2-year $5m convertible note with a 5.8% coupon rate – listed as the Note.
At maturity, Airtasker has the option to convert the outstanding Note and coupon into ordinary shares at a 10% discount to Airtasker’s 30-trading day volume-weighted average share price or repay the outstanding Note and coupon in cash.
The partnership will enable Airtasker to scale in a capital-efficient way through access to oOh!media’s over 35,000 sites across Australia including billboards, street furniture, airports, office towers and retail centres.
Airtasker was founded in 2012 by Fung, and he admits when the company was founded, it did not have a media strategy or a media budget.
“The first four or five years of Airtasker was about building the network effect and getting from zero to one as a marketplace.
“Frankly, 99% of what we did, did not work in those first four years. However, in 2016, we partnered up with one of Australia’s television firms, and we really learned the power of being able to build a brand.”
Airtasker partnered with Seven West Media in 2016, and Seven secured a 15 per cent shareholding. It provided media support and investment to drive brand awareness while also implementing an integrated TV sponsorship and digital support across Seven’s content and brands.
“Over the five years between 2016 and 2021 [with Seven], we were able to increase brand awareness from 6% to over 60% and 20X our revenue during that period.
“Then when we exited that network from the cap table, we wrote them a check for close to $43 million dollars, which was 5x on what they put in.
“What we learned from that is you have to have the courage to be able to invest in your brand upfront. Building a brand is much more about a long-term investment, it requires some courage, and it does require a capital-efficient model and that’s what this [oOh!media] deal represents.”
See also: Airtasker joins forces with oOh!media in $6m media partnership