Women's site Bustle raises $11.5 million in 'the most oversubscribed round of my career,' CEO says

Why Startups Are Struggling to Find Funding

The digital media boom may not be over just yet.

Bustle, a media startup focused on creating content for millennial women, has raised $11.5 million in what its CEO Bryan Goldberg, who previously cofounded Bleacher Report, says was "the most oversubscribed round of my career."

Not many startups are able to say that these days, particularly as the doom and gloom of a potential market turn sets in. Over the past few years, it's been relatively easy for startups to raise big piles of cash on the promise that someday, they'll figure out business models. In the past year, roughly 100 startups raised rounds of financing at valuations that exceeded $1 billion (the "unicorn" club). But some of those once-promising companies have already begun to go bust, and investors have become much more cautious with their capital.

"The tone [in Silicon Valley] is different this year, it really is," Goldberg said on a call with Business Insider. "One year ago it was, 'Get everyone together with a big surprise party and a taco truck' to announce a round. That's not the mood right now. Instead the message is, 'Keep chugging along.'"

Goldberg says the secret to attracting VCs in a more conservative market is simple: show them the revenue.

Bustle, he says, still has money left over from a $15.5 million round the startup raised at the end of 2014. That's thanks in part to Bustle's advertising revenue beginning to kick in. The startup says it met its 2015 revenue goal of $10 million and expects to "greatly outpace" the $20 million goal it set for itself in 2016.

Since its launch in 2013, Bustle has grown to 45 million global uniques (32 million in the US, according to Comscore). In November it launched a sister site, Romper, which now has 3.5 million uniques, according to Bustle's internal analytics. The top traffic referrers for Bustle are split evenly between Google and Facebook, with Pinterest being the third largest referrer.

BustleWhile $11.5 million is a lot of money, it's not nearly as much as some other media companies have raised recently.

Last August, Vox and Buzzfeed raised $200 million each. A lot of that money is expected to help the sites become digital video powerhouses that can start stealing away big ad dollars from traditional television networks.

Goldberg, however, wanted to proceed with caution both in terms of its funding and its video efforts.

"At the end of the day, a fundraise should be driven by capital needs. And our revenue is growing at a high rate right now ... it is through the roof," he says.

As for digital video efforts, Goldberg says Bustle is putting out a few clips per week but doesn't want the team to grow too quickly. First, he wants to see how Facebook's and Youtube's video platforms evolve.

"There are some digital media companies that are betting tens of millions of dollars on video ... I wish them the best of luck with that bet," he says. "We're going a little slower because we want to see how landscape develops."

Still, to Goldberg, the best digital media days are ahead.

"A lot of media people going to be winning in 2016," he says. "Fundraising won't stop for the best ones."

The round was led by Saban Capital. GGV Capital, General Catalyst Partners, TimeWarner Investments and Social+Capital also participated.

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Women's site Bustle raises $11.5 million in 'the most oversubscribed round of my career,' CEO says

#1: "I still work hard to know my business. I'm continuously looking for ways to improve all my companies, and I'm always selling. Always."

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#2: "When you've got 10,000 people trying to do the same thing, why would you want to be number 10,001?"

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#3: "Because if you're prepared and you know what it takes, it's not a risk. You just have to figure out how to get there. There is always a way to get there."

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#4: "Go out there and get rich. Get so obnoxiously rich that when that tax bill comes, your first thought will be to choke on how big a check you have to write."

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#5: "​In the past, people used to tell me to shut up a bit. But what I believe is to put out your opinion and let everyone else react. If I'm wrong, I'm wrong."

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#6: "I've learned that it doesn't matter how many times you failed. You only have to be right once. I tried to sell powdered milk. I was an idiot lots of times, and I learned from them all."

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#7: "Work like there is someone working 24 hours a day to take it all away from you."

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#8: "Forget about finding your passion. Instead, focus on finding big problems."

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#9: "It's not about money or connections -- it's the willingness to outwork and outlearn everyone when it comes to your business. And if it fails, you learn from what happened and do a better job next time."

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#10: "What I've learned is that if you really want to be successful at something, you'll find that you put the time in. You won't just ask somebody if it's a good idea, you'll go figure out if it's a good idea."

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