Professional growth platform for aspirational millennials
on Apr 11 2016
Magnises members are diverse and influential millennials, who are all looking to grow, both personally and professionally, while maximizing their time in their city. They’re aged 20-40, work in finance (25%), tech/entrepreneurship (33%), entertainment (20%), arts (20%), and other careers such as medicine (7%) 50% of members report making between $75,000-$250,000 annually. Every prospective new member must apply online and we currently only accept ~35% of applicants. We look to accept members with drive and passion for maximizing their professional and personal growth.
As much as we’d like to accelerate revenue by accepting every applicant that would dilute our member base and in turn, the member experience. Our holistic application review process allows us to create a positive environment for all members.
Ambitious millennials are constantly trying to accelerate their career and expand their network while accessing the best their city has to offer. Unfortunately it’s easy for a young professional to get pigeonholed into small professional communities like finance, fashion, tech or music. Accordingly, it becomes difficult to meet influential people outside the office from different walks of life that could be friends or help advance their career. Furthermore, without a well-defined network (professionally or socially), young professionals do not have access to unique experiences in offers.
We think the best way to maximize city life is to connect and cross-pollinate all these people from different industries in one ambitious community through unique live experiences programmed from our partners, who look to attract the next generation of talent. The best things happen when people connect with those you wouldn’t otherwise have the chance to meet. Magnises is creating this community - we’re pulling millennials out of their work bubbles and connecting the brightest young people in cities across the country.
Our members are truly dynamic; they’re always moving, they’re never stopping and they’re always looking for the next thing, how to get to the next level. The root of Magnises’ value is the professional network we’re creating that members can leverage to step up in their career. We’ve had plenty of members who have invested in each other’s businesses. People have met their future bosses, partners, and just great friends via Magnises - it’s a really cool process to watch.
The best part about Magnises is that all the offerings that we give back to our members come from the membership base. Members offer benefits and events for other members and then the rest of the community can pick and choose which events could really impact their career. We work hard to vet members who are able to create value and give back to the rest of the membership base.
Our recently launched WorkPass allows members to access one of the most unique co-working spaces in NYC, Alley, at up to an 85% discount. For $99.00/month, our entrepreneurially focused members now have an inspiring space in which to work and meet other like minded individuals.
Each new member increases the value of the Magnises community exponentially on both a fun and professional level.
The most valuable part of Magnises is our access to this high quality group of aspirational millennials. We have a very effective and unique method of working with partners as they can use Magnises as a direct link to these customers. Fashion brands can offer exclusive discounts to fashion forward influencers. Clubs can offer access and table service to Magnises members. Hotels offer discounted rooms and special benefits. Sports teams give free tickets. And all our brands enjoy advertising at Magnises events in front of hundreds of influential millennials. Forbes, Samsung, Hearst, Esquire Uber, Tesla, Barclays Center, Stoli Elit, Russian Standard, Jack Daniels, John Varvatos, and other leading brands collaborate with us to capture the next generation of consumer spending.
The Magnises community is a group of the most influential young professionals and artists in any given city. Brands aren’t just speaking to consumers individually, they’re communicating with an entire community. If the Islanders can get the Magnises community to embrace them as the hockey team of choice then they’ve captured an entirely new fan base. Magnises members are taking their friends, wearing Islander apparel at influential events, etc. all for the price of a few free tickets. I can’t think of a better fan base for any brand than the Magnises community.
Leading brands want access to ambitious influential millennials and we provide that access.
We don’t have any direct competitors at the moment. There are plenty of companies that offer membership benefits but they all fall short in some way. Country clubs and member clubs like the Battery in San Francisco offer exclusivity and access to a nice space for dinner, drinks, and events (sometimes golf). Members pay exorbitant fees for access to one bar and restaurant. Membership is rarely based on application and how much value one would actually add to a diverse group of ambitious people. While social events are limited to the clubhouse and often cost extra. These sort of clubs make no effort to integrate their members and so they can take advantage of a curated community of awesome people. In these types of clubs one is generally paying for access to one specific perk and a set of members with similar professional backgrounds.
Some compare us to FoundersCard, but they’re going after credit card style benefits without actually being a credit card. They're trying to provide travel based benefits for entrepreneurs, taking the angle that credit cards aren't providing the best hotels or flight rates and that they can do better. It all comes down to the daily relevance of a brand, and using a brand that people rely on and refer back to multiple times a day instead of once every year for travel. The other problem is they’re not centralized at all geographically - members are located all over the world - so bringing together the community in person to interact is nearly impossible. All our events are city specific, so members can actually attend and get value from the community.
We’re different because we bring a diverse set of high quality people together in one ecosystem, giving them access to unique experiences and benefits they cannot access elsewhere at a price point amenable to the millennial wallet. Finally, none of these competitors offer the payment tool piece. On a B2B level, all our brand partners get to advertise to a community of people via their best spending tool.
We make money from both membership fees and brand affiliation and advertising. Right now we make ~70% of our revenue from the $249 annual membership fee and 30% from brand advertising at Magnises events. By the end of 2016 membership fees will account for less than 40% and advertising will make up over 60% of our revenue.
Right now we offer all benefits and events to all members. And every member gets a baseline set of benefits that we make explicitly clear when they sign up. We want to ensure that the ROI for the membership fee is concrete. Some of our events cost extra - like driving a Tesla at the racetrack - but they’re always open to everyone.
As we evolve, our main source of revenue will shift away from member fees to above and beyond events like the Tesla driving that cost a little extra.
Membership add-ons such as our WorkPass (where members access co-working spaces for $99.00/month), and our ClubPass (where members receive VIP access to NYC’s best nightclubs for $65.00/month. We are exploring launching additional passes which allow us to capitalize on recurring revenue opportunities while improving the member experience.
As our member base increases, our opportunities for advertising and sponsorship revenue increase. We are evaluating major lifestyle and beverage partnerships for 2016.
Our model is unique because both advertisers and members love us so much. Most companies cater to one party or the other. In our case, we have over 30,000 applications and 500 partnership requests a year.
We’ve done very little to promote Magnises, relying almost exclusively on referrals to 1/ save on marketing and 2/ ensure our applicants are willing to give back to the community. Several other companies have tried to curate a unique community of influential individuals but they’ve all failed for a few reasons. They often get greedy and accept anyone who applies which dilutes the professional experience. This also presents a problem when events no longer feel exclusive because lines are long or members can’t attend because there’s no room. Other former competitors have just failed to monetize their member base.
We’re also unique because almost all special benefits are actually gifted by members. There is nearly zero cost for us to add benefits to the app because members are so excited to offer something to the community (the Islander’s tickets is a great example). We have no promotions or sales team and no paid compensation for sourcing deals. Almost all growth is organic.
Revenue has increased 75% year over year, up from $1.2M in 2014 to $2.1M in 2015. Membership also experienced remarkable growth due to our expansion to DC and the increasing application rate in New York. We doubled membership last year and just surpassed 10,000 members each paying $249 per year.
Expansion to different geographies is a great way to grow and really easy for a number of reasons. Our members have networks that bleed into the biggest cities across the country. So millennials in new markets have already heard about Magnises, they’re waiting for us in cities like LA and San Francisco.
I started my first company at 13 and sold it at 14. I built another company in high-school that was acquired by a media company. Before Magnises, I started Spling, a content recommendation engine, which is running profitably. I have eclectic, intense passions which have led me to surround myself with interesting and unique people from many industries in New York. I love bringing this group together to create new experiences.
Our executive team comes from a diverse background of Fortune 500 and high-growth companies. Our engineering team lead technology initiatives at The Department of Defense and UBS, our head of marketing was a key member of Daymond John’s team (an investor on ABC’s Shark Tank), and our head of customer experience ran CX for The Wall Street Journal (A Dow Jones Company).
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