FUBO - fuboTV Inc. (FUBO) Presents at 26th Annual Needham Growth Conference (Transcript)
2024-01-17 14:11:02 ET
fuboTV Inc. (FUBO)
26th Annual Needham Growth Conference
January 17, 2024 10:15 AM ET
Company Participants
David Gandler - Chief Executive Officer
Conference Call Participants
Laura Martin - Needham & Company
Presentation
Laura Martin
[Call Starts Abruptly] …David Gandler. David was appointed Chief Executive Officer of Fubo in April of 2014. Prior to joining Fubo, David served as the Vice President of Ad Sales at Dramafever, a video streaming service acquired in 2016 by Warner Brothers. He's also held positions at Scripps Networks Interactive, Time Warner Cable and Telemundo, and he has a BA from Boston University. Okay. I want to start with leadership. You have about 500 employees, David, and I'm really interested, I really believe that employees are cheaper and they stay longer, which lowers churn if you have a really great culture. So tell me about the culture you're trying to create at Fubo and what are the metrics you use to determine whether the culture you're trying to create is actually being executed?
David Gandler
Yes. Not an easy question to answer. I would say that from a churn perspective, you are right. The culture is key. I think the average churn at technology companies out west is roughly around 12 to 15% a year. We're probably closer to -- and historically that that has been the case, probably 6% to 7%, maybe even less…
Laura Martin
So like half…
David Gandler
Yes, I would say even less. Culture wise, you know, I think the key is that people need to feel motivated, number one. Number two, they need to feel that they're building something that they can be proud of and that they're competing with very large entities, as you know, that has been our Achilles heel, I think as we talk about our business. And they need to feel that they're learning things, right? So when you have a very open culture and people believe that they have access to different information, because if you think about corporate, everyone is siloed. You're the finance person, he's the sales guy. And so sales guy comes up with an idea, everyone goes, no, that's the sales guy, he doesn't know what he's talking about. So we try and make sure that we have a good flow of information and we're very transparent about it. And great ideas come from the top, they come from the bottom, they come from different groups and different people. So that's something that we are very focused on. And we want to make sure -- one of the other things I think that are very important is to ensure that if I'm doing a good job, you're going to want to work with me. And so, if you have high performance and high performers then you're going to see that there's more higher quality personnel will gravitate towards the company and towards different groups. So we've tried to sort of create a culture of speed, velocity and also ensure that people are empowered to actually build things and they're fearless. We want people to take risks, which we have been.
Laura Martin
And that lets them stay longer and presumably you let them fail. I mean, if they're -- you let them take risk, you must…
David Gandler
Of course. I think the one thing that I personally try to do and I think many of our top managers, by the way, most of the managers have been with me for, I don't know, at least six years. So the company is in its ninth year. And we tell people it's okay to make mistakes. I mean, you have to make mistakes. How else are you going to know? It's just like AB testing, right, you test something. Of course you hope that your mistakes are small and you're big wins are very large, but that's been sort of the nature of the business since the beginning. And it's important because there's very little visibility in our space, and every week it's something else, bundle and bundle, and rebundle…
Laura Martin
That true. Netflix was never going to have an ad tier, suddenly it has an ad tier…
David Gandler
Yes, right, bever say never. I think that's sort of been the nature of it. And I think people feel that it's a very fast moving industry. Obviously, it's under significant duress at the moment. But you have to keep people motivated.
Laura Martin
Okay. Staying on this culture idea, future of work. So I got to tell you, I think this is one of the most interesting topics going on, not in media but just in general for America…
David Gandler
Yes, in general, yes, internally and externally, by the way. So internally, meaning within the company as well, it's a topic of debate all the time.
Laura Martin
Is it really?
David Gandler
Yes, it's not just something…
Laura Martin
So what are your required days per week and what percent of people are actually not obeying that?
David Gandler
So it's interesting that you bring this question up. Last week we went from three days to two days.
Laura Martin
Interesting, okay.
David Gandler
Interesting, but not ideal. There is some reasons for that. The first one is that, as you said, we have about 550 employees. Before -- during the IPO, I think we had about less -- just south of 300 employees. And so we have hired, during COVID, almost half the company. So during COVID, the HR teams were very focused on hiring top talent regardless of location. So I guess the problem that we found ourselves in is that some teams have one person in New York. And so how do you tell someone come all the way from New Jersey or Connecticut or Brooklyn or wherever you are, so that you can sit on zoom in the office. So that's one real issue. So we had to sort of go back to sort of two days, because some people feel, why am I coming in three days a week if so and so is coming in? We're dealing with these sort of, I would say, very silly problems, because in my view our culture is about moving quickly and delivering results. So for me, this is a real problem. I think that over…
Laura Martin
Because you think that needs to be together in person?
David Gandler
Yes, I think you have to be in person. My view is three days is -- should be the minimum. I can live with three to four days. I just -- I don't believe that people can create value when they're disconnected from a company.
Laura Martin
So culture has become a conflict with future of work, in a way, that's what I hear you saying from your tone.
David Gandler
Yes, no, it has and it's unfortunate, because I think once we sort of apply enough pressure and get people in the room, you ask them two, three weeks later when you've completed a project or go through a sprint, they're going to say, wow, it was great, collaboration was great. And if you're a high performer, you can sit anywhere that's like, you can sit in school, you can sit at your desk, you can sit in the library, you're going to do a good job. But that's the battle we have. But as I said, flexibility is something that we're very focused on about everything we do. And so we want it to be flexible right now and sort of revert to two days. But I think that over the next six to 12 months as we reorganize our team to better deal with some of the conditions just the industry conditions that we're dealing with, we'll probably move back to sort of a three day schedule. But to me, that's the minimum because you break up the cadence, you have Tuesdays, Thursdays and some people want…
Laura Martin
Do you let teams decide -- some guys say, okay, you have to be in three days, but the marketing team can decide which days those are…
David Gandler
So personally, bad idea. Why? Well, because you have cross functional teams. And the whole point is coffee breaks, lunches and a lot of times I think people struggle with tone. And so most people are on Zoom, you know who you are and you're slacking. Not slacking off but you're slacking on your little Slack channels and people ask you a question, you go, sorry, I didn't hear that, my zoom is off, right, I’m having technical issues [Multiple Speakers]. So when someone is there, they're very focused. And if you send me a note five words, I'm not going to say, oh, look what Laura said. I'm upset with her. I know who you are, I know what your tone is and I know you're not trying to be mean…
Laura Martin
It’s hard to build culture if no one’s in the room…
David Gandler
Well, that’s the thing. And then you have other things where someone will read an article from some pundit that's completely off, and then you have 200 people at home saying, oh my God, is this what's happening in our company? And you're like, no, you have -- come in, it's not happening. So -- but it's a tough question and it's something we have to be careful about, but we're trying to be very empathetic. But the reality is at some point benevolent dictatorships work quite well, so that moment will come…
Laura Martin
And sometimes without the benevolent…
David Gandler
Yes. Well, hopefully not, but yes, that is the case.
Laura Martin
Last year, you might recall, I asked you something about leadership about, what defines your leadership style. I had a lot of CEOs that said that the buck stops right here. Love advice. I make decisions, a number of CEOs said that, and I get that it's a lonely chair because of that. At the end of the day, somebody has to make the -- take the responsibility…
David Gandler
Yes. Well, again, we try and be transparent and just like we do in the analyst calls or what we do in the press, we try and answer every question in real time upfront in front of hundreds of people. There's no hiding. So I think if we can make the case, people will understand and I think they can live with certain decisions that we make.
Laura Martin
Yes. Well, I'm sure you've read that we're having a lot of trouble on Wall Street getting people in three days a week, especially senior people. And so to your point, if young people need to learn who they’re learning from if seniors -- it's a future work problem writ large and maybe national, but certainly in America we’re defining…
David Gandler
Yes. Well, we have offices in Bangalore, Mysuru India, which is our AI team and Paris. And I never thought I would say this, but I feel like we have more issues around back to work policy here than we do in any of the other offices…
Laura Martin
Yes, we're so uppity America…
David Gandler
I don't know what it is, but I was very surprised. I'm like, wait a minute, we're the sort of…
Laura Martin
We’re the workaholic…
David Gandler
Yes, exactly [Multiple Speakers] I don't know, but they're working hard, so good news for us.
Laura Martin
All right. Let's talk about -- let’s go to Fubo specifically. Goals, you and I are going to be sitting here a year from now. What do you want to have achieved at Fubo? Because I'm going to write it down and bring it up when we're here a year from now. What do you want to have achieved between now and a year from now, David, at Fubo?
David Gandler
So again, this is -- as we kind of prepare our budgets, there's just a lot of questions, right. I'm sure you have a lot of questions, our investors have a lot of questions about the industry. And so there's very little clarity and visibility. And what we've done really well over time is we've been able to react. I like to say we proactively react to situations. And so I think for this year our goal is to really engage consumers across the demand curve or I should say along the demand curve. Meaning right now we offer our product build for sports fans, if you will, is that probably one of the more expensive products in the United States, right, from a streaming perspective. So I think one of the key goals is to leverage the technology that we've built for greater flexibility, offering consumers different types of packaging, starting from free, free fast channels to Ava to pay-per-view to TVOD. And so I think building out our premium business will be a key component. I think that's on one side…
Laura Martin
That is a big difference.
David Gandler
Yes. And I think we've done pretty well with our fast channels within the product to drive ad revenue…
Laura Martin
Yes, but it's a -- you have a gate, you have a $70 gate and you can get those free channels…
David Gandler
Right, exactly.
Laura Martin
So they're not really free.
David Gandler
Exactly, they're not free. At the same time, there's a lot of value in those channels because behind a paywall, the argument to advertisers is, look, you have people that are paying for this product, paying a lot of money, discretionary income. They're not here because it's free and you know…
Laura Martin
So they're more valuable target audience…
David Gandler
Of course, they are. Because you might argue a person who only wants to watch free TV, that person is very happy buying generic products. They don't need P&G, they don't need any of them. So I think that's the first side is to really create -- take advantage of all the people. Remember we always talked about sort of vertical churn, or was it something that you were -- you came up with. I remember everything you say…
Laura Martin
And I remember everything you said, and I'm writing it down…
David Gandler
Yes, I know you do and you can always -- you know that you can always call me out and I'm always happy to answer any of these questions. When you think about churn, we have millions of people coming into the platform, because they want to watch a game, an Olympics, a short event. And so these -- since these people are coming through the platform, we should be able to offer -- it doesn't cost us anything to offer them other services, right, beyond the hundred. So the idea is, you know, I'm just making up a number here, theoretically, if you had 10 million people come in, right, why not offer them free TV or free access, something on their…
Laura Martin
Wouldn’t they come in via free and then get upsold, upsold ,upsold. So that's the typical.
David Gandler
Yes, but this is where it gets nuanced. And I don't want to get too deep into the product. But the risk of -- because remember, we're just, I would say, extremely detail oriented around our data and extremely data driven. And so, I think our concern, and this is why this is the year we're going to make some decisions, is if you start with the free product, the question is, do you dilute the core of what we're trying to achieve, which is get people into the virtual MVPD, come for the sports, stay for the entertainment. So this will require a lot of testing. So we've increased our testing capabilities, again, back to speed and velocity. We're running dozens of tests a week. So we're running dozens of tests, we'd like to accelerate that further. And so the idea is, should we show people content on the way out to at least keep them engaged and are there ways -- again, this is where we excel, I think. We've done a really good job of figuring out how to get people to stay on the platform. So that'll be…
Laura Martin
Your churn levels are way down…
David Gandler
Yes. So that will be one of the key areas…
Laura Martin
You have this great data. What about doing -- like Vizio makes a $100 million a year selling its glass level data. Could you make a data revenue stream?
David Gandler
Yes, we can.
Laura Martin
And have you thought about that as a new revenue stream or…
David Gandler
We are -- as you know -- you met with our SVP of Global Ad Sales, Dina Roman. We just did a deal with EDO very recently, T-Vision. So working both on the first party data side as well as on the third party data side. So the beautiful thing is we're still very early in our monetization abilities, which by the way is growing well over these…
Laura Martin
Because, I know the environment externally is out of your control. But when I'm thinking about goals, I am thinking about things like data, like we have all this data, we're data driven. Can we -- this is a year where you could package it, bundle it, regardless of what's happening in the chaos in the outside world, it's like it reminds me that Harry Potter thing, like Voldemort does this in the whole -- but you can control your little island.
David Gandler
Which is what we've been focused on. So those initial deals are really allowing us to better understand our audience. And so I think over the next 12 to 18 months, again, we have a nice runway we're going to focus on that. But yes, we are talking to companies about selling data at the moment…
Laura Martin
Good, it's a great idea and it's something you can control. And CTV data is all the rage right now. Okay, great. So your subscriber growth, David, has been very strong. I think part of it is lower churn and part of it is you really are making this work come for the sports day for that. The fact that the Peacock deal that they paid $110 million for the playoff game about $23 million. Like tell me how that affects you, like what you think about…
David Gandler
Well, for me personally, the company is very consumer oriented. I think we're one of few companies in our space. Everyone else is about bill them and take their money and wait till next month, right? We have been very focused on discovery on the platform. We were one of the first companies to acquire a small video AI company back in ‘21 before the rage. And so, when I think about the Peacock situation, from a consumer perspective, I'm actually -- it's sad to see. I'm horrified, I'm actually surprised and hopefully I don't scare anyone here…
Laura Martin
I think it's an experiment by the leagues…
David Gandler
Yes. I think so. But if not then the FTC does need to take a look at consumer protection law. I mean, you have -- people are paying for much of the same content several times, right? And you have games…
Laura Martin
It was exclusive to streaming…
David Gandler
Well, in this case, yes. But you're still paying for the bundled offer, which still has a lot of the content that is offered across these different plus services. So you're paying multiple times in some cases for the same content. But for us I think nothing has really changed. We have -- we're aggregators. And I think for a very long time, actually found a quote from 2021 where I said -- this first was three years ago exactly where I said we were going to go from bundling to unbundling to rebundling. And so I think that consumers really -- I mean, again, from a consumer perspective, I believe one single app fully aggregated where people can discover content that it can all be personalized, easily accessed, one bill, and our job is to manage that relationship. So from a subscriber perspective, I think that we're able to continue to drive growth because of the way we positioned ourselves in the market. But I think more than the Peacock situation, I think the YouTube situation was a little bit more scary, I think…
Laura Martin
Because of direct -- to a Sunday ticket thing, which is a multi-year deal…
David Gandler
Yes. And I'm not sure we get any credit for this, but if you look at this sort of, right -- I mean, I think that's fair. If you look at third quarter, we added 310, roughly, if I recall. For me, it feels like this was like eight months ago. About 310,000 net additions. Hulu, very large company tied to Disney, packaging up Hulu SVOD and ESPN Plus and D Plus. I think they added something like 300,000-ish, the Hulu live product. I think it was like 300,000 net additions…
Laura Martin
Yes, I think they added less than you. I recollect because they had less than you…
David Gandler
Yes, they did. I'm just being polite. And then you have YouTube, which the force of God. I mean, they added the Sunday ticket, they offered -- the promos were insane. I've seen everything from get a full $400 off to even like these latest ones I've seen like get it for 60 bucks, 80 bucks…
Laura Martin
Part of it is like the season is ending, so they're cutting the price every game that goes past…
David Gandler
Yes, I know. But at the same time, that's happening because it's very difficult to monetize. And then when you add on top of that all of their marketing activity, YouTube, YouTube proper, I believe they added about 350,000 net additions to their YouTube TV product, not the Sunday ticket product. So when you look at that in the context, we're actually performing quite well relative to some very big players.
Laura Martin
But one thing I'd say, David, is you're sort of tied to the linear TV ecosystem. And as sports rights, which is the competitive advantage of linear TV, slowly seep into -- I mean, Peacock is a bad example because it's owned by Comcast. You would think they would have a lot of incentive to keep the linear TV ecosystem intact. But as rights seep to Apple or to Amazon or outside the linear TV bundle, it feels like there's less and less value to the linear TV bundle that you're selling. I mean, isn't this an overall threat to you long term as rights move into non -- streaming only, let’s call it that…
David Gandler
Yes. I mean, this is a threat that we've been talking about since 2015 or ‘16. At the end of the day, we still have tens of thousands of sporting events. And the NFL deal, which as we all know is the most important piece of content, there's a 10 year deal there in place. So we’re talking about…
Laura Martin
And by the way, over the weekend, they're talking about it owning part of ESPN that would make it a 50 year deal. If the NFL does a deal to own part of ESPN that's linear TV bundle…
David Gandler
Right, exactly. And so at the end of the day, sports needs distribution. And we all know it's a loss leader, it's very expensive. And when fully distributed, it achieves the goals of all the stakeholders. When you look at MLS, that's a good example. It actually…
Laura Martin
Major League Soccer…
David Gandler
Yes, Major League Soccer, it's tough, right, it’s just tough. So fully distributed across platforms like ours, I think, is the future. I don't see it any other way. And let's not forget, I'll say little Fubo for now relative to everyone else. But if you just look at our financials, we spend about, what is it $1.2 billion on content. So we’re, I would like to say, subsidizing plus services. So it's a massive revenue stream. In some cases, wholesale prices, because these deals are older, might actually be with promo pricing on plus services could actually be lower in some cases, right? And so as prices -- relative prices rise, the bundle becomes more and more relevant over time. So I think this is the only way that people will watch TV in the bundled world. And I just want to make a bit clear that there's a big difference between what we're doing and what others are doing, Xumo or Charter. We don't want to be an app store, that is not our job. I know some want to focus on having all these apps and we are about consumer experiences. And so we want to be a video bundle, not just an app store. And so we want to package content up, create opportunities for media companies to access high quality data, give them information as it relates to different programming, help them monetize their content, provide consumers with a real seamless experience in a premium environment. And that's a little bit different than what I'm actually seeing as what the goals are for some companies.
Laura Martin
Okay. So I do think there's a consensus on Wall Street that TV is moving towards the phone with the apps. And you're saying you want to do channel, which is the old linear TV bundle look where it's just a grid of channels, that's what you're saying?
David Gandler
No, I'm saying -- well, you know, we have over -- well, first of all, we have like 2,000 feeds, but we also have about 30,000 VOD assets on the platform. So it's a combination of live and on demand…
Laura Martin
So you say no apps…
David Gandler
So what I'm saying is…
Laura Martin
You just don't like the postage stamp…
David Gandler
What I'm saying is the app store is a very broken experience. What do I mean by an app store? So you go into Amazon Prime, there's a Fubo app. You're watching…
Laura Martin
Yes, more spectrum or…
David Gandler
Yes, right. All kinds of apps, right. So you're watching MS NBC on Fubo and you realize it's Thursday night and you need to go to some other app to go watch Thursday night football. In this case it's on Amazon. But if you wanted to watch the Notre Dame football game, you need to now leave this app go into the Peacock app. It's -- one is it's problematic for people to jump around all these apps, which means you're losing viewers because people are just…
Laura Martin
It’s true, friction…
David Gandler
Yes, there's lots of friction points. So reducing friction's important. And then the other thing is with all the major technology companies wanting to become the app store or that homepage that you get, they don't have any data. So think of it this way, you -- let's use foreign companies, I don't want to talk about US companies. So let's say you're in France and you have Canal Plus, which is like a Comcast and you know you're on the My Canal app, which is like any other virtual MVPD app. And basically you deep link into the Disney Plus app to watch Star Wars. So Canal Plus says, oh wow, I'm going to tag this person, they like Star Wars. They go into the Star -- they deep link into D Plus, open up the Star Wars page and then they say, you know what, I'm going to watch Moana or whatever, something else. And they just hang out and watch all these animated shows for the next two weeks on Disney and never actually watch Star Wars. So because you've lost the connection to that viewer, you can't even help them service other content that is similar -- Discovery is completely out, it just won't work and then also you're just not able to create profiles for advertisers as well. So for me, it all comes down to being in the video bundling business and not in the sort of app store. And I don't mean to say it in such a negative way, but that's what it is, right? You're just picking apps and jumping in and out. So -- and given the amount of content that's available out there, I mean, we have about, I think 150,000 assets. So we need to figure out a way already how do we get people to watch it. And as much as we think that the bundle's losing value, we're still over a hundred hours of viewing per month per customer…
Laura Martin
So let’s go to gross margins. One of the things using my favorite whenever we meet for breakfast [Multiple Speakers] on gross margin. So let's talk about cost of content that the gross margin level gross. Talk to me what's happening with costs?
David Gandler
Yes. So…
Laura Martin
You've been doing a great job, by the way.
David Gandler
Yes, thank you…
Laura Martin
Gross margin's been going up…
David Gandler
Yes, they have. And I think we've improved year-over-year, don't quote me on this, I want to say around a hundred million bucks of EBITDA, which is a very tough thing to do for a smaller sized media company or distribution company within a year. I think we've done it almost now 18 months. From a gross margin perspective, I think that -- again, going back to the super aggregation strategy, we've done a pretty good job, I would say, driving ad revenue. I think, if I'm not mistaken, ad revenue was up about 35% in the third quarter year-over-year, which I think when we signaled that we thought third quarter was going to be strong back in the second quarter, everyone was kind of like, I don't know if I can believe that. With the super aggregation strategy, I think there's going to be real room for us to drive ad sales. So I think from a revenue perspective, there's some real upside still to focus on in ‘24.
Laura Martin
So that's your gross margin strategy, not on the cost side it’s more on the advertising side…
David Gandler
No, so there’s -- it's multiple. I never look at anything as like you have to be able to pull all the levers, because you just have to. You never know which lever is going to be more important in any particular quarter. So we'll focus on revenue upside, packaging optimization, advertising…
Laura Martin
Packaging optimization is like selling three month bundles, is that…
David Gandler
We test -- if you go in every day from a different IP address, you'll see there's very different offers. And all of that is just being AB tested. So that will continue to happen. On the cost side, as we have been doing a good job, we're actually quite lean already. We have about, as you said, like 550-ish employees. I don't plan to increase the staff size for the next, call it, 12 to 18 months, only because I want to maintain speed and velocity. And so, the only other area for me on the COGS side to focus on is the broadcasting and transmission. So I think there's some room…
Laura Martin
Not the renegotiations, you have nothing coming up in ‘24?
David Gandler
Well, we have stuff coming up.
Laura Martin
[Multiple Speakers] what’s coming up in ‘24…
David Gandler
Perhaps. I don't know if I'm at liberty to say. Maybe. Well, the good news is there's a deal up every year. So it's going to be one of the big four deals. So look, there are deals that are coming up all the time. So there will be some more leverage around content costs. But again, we're sort of -- kind of a weird situation, because you have media companies that make a lot of money just distributing to us. When I say us, it's the whole industry. And at the same time, they're trying to grow their own streaming services. So I don't like to put a lot of eggs in baskets like that where you just don't know how things net out. So yes, they can go up, they can go down, they can be flat. We might decide maybe there's some penetration rates that will change favorably. But I think to be focused on what is in our control today, in January, that those deals are mid-year to end of year, we're probably going continue to focus on things like the technology costs that are related to COGS, which in this case is broadcasting and transmission. And we've used technology I think very well over the last year to drive down costs, cloud costs. We launched our own data center in Denver, all Nvidia chips, which is nice, looks beautiful. So we're continuing to focus on achieving our profitability targets in 2025.
Question-and-Answer Session
Q - Laura Martin
Okay. Let me take questions. Yes sir.
Unidentified Analyst
You're doing a great job in numbers. I'm just going by the numbers, but frustrated being public right now and it seems like…
Laura Martin
No, because he loves talking to me.
David Gandler
Yes, but I was talking to you before we went public. I think my first…
Laura Martin
That's fair, you could be private and still be talking to me. That's a fair point. His question stands.
David Gandler
As an entrepreneur, my frustration lies in my inability to build a business the way I think it should be built, because there's a lot of us now. And so you have to take in mind how shareholders feel, how investors feel, how the Street feels. But -- so it's a balancing act. So I'm a bit frustrated, because I think we could do a lot more. And obviously the environment has changed completely. And I think it's incumbent upon myself and members of my management team to sort of understand where we are today and what the requirements are. But I do believe, if you sort of forecast out five to seven years -- again, it's timing is everything. I think Spotify was able to grow in a time where growth was the only thing that mattered and that created great opportunities for them and scale. And so unfortunately we just have to balance. So I am somewhat frustrated, but -- so is life frustrating.
Unidentified Analyst
I guess the second part of that is five years from now, if you can continue to perform as well as you've been performing and the way the market's looking, and it's like yours stock still maybe $2.5 to $3…
David Gandler
Until it's not, right? I think, I just had this conversation with Allison the way over here. It's tough to say how investor sentiment works. In my view, just as someone who also invests in private companies, because I love startups. I want to know that the company that I'm investing in is going to win. It's going to be one of the leaders in the space at some point. And sometimes you can't actually build on that plan, because you have short term needs. I think one of the key things that why startups or startup entrepreneurs believe they can win, you can face Google and Comcast and -- because you know you can move faster, you know that you can be more decisive because your organization is flatter. There's dozens of reasons why startups believe they can win. And we've historically seen how often start-ups -- Zoom defeating Cisco in the video conferencing space, who would believe that. Gazillion dollar company, 500,000 employees, resources. I mean, they have everything. So to me that part is a little bit frustrating. But I also realize that at some point when you -- people run out of reasons to tell you will fail. I think Amazon has come up every year in almost every conference I've ever spoken at Amazon has been the threat, 2016…
Laura Martin
But it is a threat [Multiple Speakers] still a threat…
David Gandler
I know, but it’s now -- of course there's always going to be threats. But it’s, oh, they’ve got Thursday night football, you're dead. Oh, they got Sunday ticket and you're dead. Oh, Facebook bought LaLiga in India in 2016, you're dead. Oh, Disney's launching ESPN Plus. So again, it's a big country, there's lots of value to be created. And again, sometimes I feel like it's a little bit too small for me personally, but I have a job to do and the goal is to drive the value for customers and shareholders. And I think over time that $3 comes -- becomes -- I mean, we were $1 stock, weren't we, less than 12 -- maybe 12 months ago. So I guess, being an optimist, you could argue that good growth, I guess.
Laura Martin
Any other questions for David?
Unidentified Analyst
What's your -- how do you trade off growth and free cash flow? I think companies that are consistently free cash flow positive do not stay single digit stocks. Maybe in this business, there's only one company that makes money, so maybe that's why everything's depressed, but there's only one company that can generate free cash. Are you able to eventually do that, sustain it…
David Gandler
Well, I think the interesting thing is that we were able to improve our EBITDA within 12 months by about a hundred million bucks for roughly, right? That to me is a very big move. And so -- I mean, it's not crazy for us to improve our -- Laura mentioned the content deals, right? We pay at 1.2-ish, I don't know, 1.1, 1.2 on a run rate basis for content for ‘23. I got to be careful. And so if you were to improve those deals by just 10%, 8%, 7%, 6%, you know, basically, we're free cash flow positive. So it's not a crazy thing to flip the switch at some point. What is unfortunate, and as Laura said, some things are in your control some are out, is that the media landscape is in some crisis overall, because I don't know what it is, I think -- what's interesting, it's actually ironic, because everyone's talking about how the plus services need to figure out bundling and they're trying to do a deal with Verizon and they're trying to do deal with Walmart or whoever, or Amazon. The reality is we are an independent aggregator that is already bundling, that has no conflicting interest, that is 100% aligned. So they're looking for every solution. And this is an industry thing, it's not one player. When the solution is right in front of them, they're getting 75 million, correct me if I'm wrong, 60 million Pay TV households plus 15 virtual…
Laura Martin
Yes, I'd say 65…
David Gandler
65 plus 15, and where are we? I don't even know where we're…
Laura Martin
Well, actually no. Now streaming, streaming is like…
David Gandler
Well, Pay TV plus virtual MVPD, what is that, it’s now…
Laura Martin
Yes, then you're up at 75…
David Gandler
Right. So if you think about what is the cap for any plus service, let's just use the gold standard, Netflix, I bet there are probably US only in the 69 million to 70 million range. Canada, I don't know what Canada is. But if that is the gold standard, you already have more than that. You have no churn, right? We are helping you amortize your marketing costs for every show across all of our, right, services because we're marketing…
Laura Martin
You're talking about NBC, you're talking about content creators, is that…
David Gandler
Yes, I'm talking about we, the distributors, Pay TV -- all Pay TV, MVPD plus virtual. We're already giving you scale, we're already paying fees, you're already monetizing the content. In this new world that I guess that they're trying to figure out or fighting for, they want to pay a commission to Amazon, right? They have to, they have to pay commissions to, at some point, to Verizon, they're having to deal with churn…
Laura Martin
And they as the consumer…
David Gandler
They meaning the content [creator], the plus services.
Laura Martin
Okay, got it.
David Gandler
Because they're looking for bundling. Everyone is saying -- all the analysts are saying, well, hey, if you don't bundle, your churn will outpace your ability to drive growth. So the solution is here. So -- and I've said this many times over the last two years is the market is moving in our direction. And I think ultimately there will be capitulation and business outcomes will prevail. And at that point, I think what you're saying is how do you sort of get there, I think that will become quite evident.
Laura Martin
Other questions for David? I think we're right up against time. We are. We are up against time. Thank you very much. Thank you very much, David.
David Gandler
Thank you.
For further details see:
fuboTV Inc. (FUBO) Presents at 26th Annual Needham Growth Conference (Transcript)