Justify Your Existence: Recess is a Marketplace for Real World Sponsorships

Welcome to Markitecture's Justify Your Existence, where we ask early stage startups to tell us why we should care about what they're building. Today we have Jack Shannon from Recess. Jack, thanks for being

here. Yeah, thanks for having me Ari.

Let's start with the basics, the size of the company, where you're located, how much have you raised.

We are a 20 person team. We originally were located in Los Angeles. The team's all now spread out post pandemic

11. 5 million. Okay. Wow. Wow. That's a pretty big, uh, pretty big starting point. Okay. And what does Recess do?

Recess is a brand activation platform for CPG brands to discover unique experiential brand partnerships and sampling opportunities for their target audience. So we're, can think about us like a, an ad network for the 67 billion experiential marketing and sponsorship industry that's out

there. Okay, so give an, give some examples so the audience knows what experiential means.

Yeah, so we work with brands like Pepsi, general Mills, uh, milk Bar, and we help them connect them to places and spaces where the audiences that they're trying to reach hang out. So places like Equinox or WeWork or their local farmer's market or their kids' little league game on Saturdays. So we. Um, are a two sided marketplace that can connect them up to those opportunities. And then we manage the fulfillment, activation, and measurement around those partnerships. So, you know, at the end of a 5K run or race where you get a kind bar or a banana, we're the, the people that are getting the kind bars and the bananas to those, places and spaces.

So I could log into your platform and bump KineBar out of the, out of the race and say the Paparo Bar is going to be the thing

you're going to get. Absolutely. Yeah, you could come in and buy category exclusivity out and block your, all of your competitors from accessing those audiences. Whether that's Spartan Race or, you know, any, any type of 5K Run, Turkey Trot. We've got thousands of opportunities in the platform and you can target them in all kinds of different ways.

Is it an auction or is it more of an RFP in response?

Yeah, so it's, uh, it's actually not even really RFP. It's, it's, uh, the organizers, the, the farmer's market, the race, they come onto our platform. They sign up and they create an account almost like Airbnb in a sense, and they set their price. So they say. You know, for this, uh, sponsored email that would go to all my attendees, I'll charge this. For the 10x10 booth at my event, I'll charge Y. Um, in order to have your product in the gift bag that's gonna go out to everybody, you know, we'll charge Z for that. So they're setting the price and then brands can come in and... Search and discover and, you know, sort and filter and find the opportunities that make the best sense for, for their audience and for their price point and budget as

well. But it sounds very custom to me. I mean, it seems like brands are always going to want to have opinions about how they're presented and they're going to want to haggle on the price and stuff like that. Um, how does that facilitate

Yeah. So I think it's. It's probably, I mean, I wasn't around when, uh, the digital, early stages of, of programmatic and digital was being, you know, kind of commoditized and everybody had to agree on the right ad unit, whether, you know, the 728 by 90 and the 300 by 250. I hear before that there were all kinds of different ad units that people used and then the IAB standardized that. So, uh, we took a similar approach where we said. You're totally right. Events and experiential, the kind of common understanding is it's too custom to really scale or put onto an exchange. And so we, constrained the marketplace and said, these are the, these are the assets that we know, people want to buy most often. So putting something in a gift bag the 10 by 10 space is kind of like the, the 300 by 250 of the physical world. It's the most common, it's the most purchased. and so we just constrained the marketplace and said, You know, if you're an event organizer, you can't list all of these different things, we're going to sell these very specific types of partnerships. And that's what enables us to scale them across, you know, thousands of partners with, with a single buy from an app, from an advertiser.

And do you get involved in logistics and do you get involved in payments?

We do get involved in payments. Yeah, most of our customers are fortune 500 brands. So they're still You know getting paid over a purchase order versus, you know, putting in your credit card or something like that And we do our platform does manage logistics as well and kind of similarly You know every organizer previous to recess was doing it a little bit differently But we forced everybody to use our tool in the same way Um, so all of that logistics, is all, you know, scaled through the platform, and our team. So if a, you know, a single brand buys a thousand partnerships, they're not having to talk to a thousand different people or coordinate a thousand different things. we've kind of built the training wheels and we force everybody to kind of use the same tool, which enables us to, to scale these partnerships.

So if I'm buying this, this kind bar example, am I shipping the kind bars to you?

You can, uh, if you want to, we do offer that as a, as an additional service. If you want to ship it to a centralized warehouse, our default, the cheapest way to do it is we provide you, the addresses, the quantities, all that information, and then, the brand ship them out themselves. So I'd say probably. 50 percent of people do it themselves and probably the other, you know, the other half are taking advantage of our, warehousing and shipping services that we've added on top as well.

And tell us, tell me about the fees and who pays them.

So the brands pay the fees,, it's on a,, cost per engagement model or a cost per item distributed. And then if they have additional media elements, sponsored email, sponsored social,, digital out of home, that's just traditional kind of CPM basis., so the organizers set their price. And then the brands are building their program, adding those items to cart, and then they're paying, we get paid by taking a percentage of that transaction fee.

Do they know what they're paying you?

They do yeah, it's standard we don't publicly disclose it I'd say it's in line with standard ad marketplace You know rates app store different things out there

as well. Great last question If your company was an animal, what animal would it be? Don't say lion. Everyone says lion.

I don't have a great answer to this other than like otter, maybe I, I just, I just like otters. So I don't know. I probably need to, I probably need to, I'd probably need to come back with a more thoughtful response to that, to that question. Um, maybe some, some animal that is secretly, uh, helping other people in the background, uh, and not taking credit for it. We often like to think we're this like kind of hidden tool behind the scenes for, for marketers helping them do a lot of this stuff that's traditionally been. very expensive and hard to scale and tough to manage. But I don't know what animal does that. So I'll have to get back to you on that. You have to do some

research. All right, Jack from Recess, thank you for justifying your existence.

Thanks Ari.