BookBub Raises $3.8 Million to Help You Pick Your Next E-book

What's This?

The team at Bookbub, an e-book deal service that just raised a Series A round of funding.

By Seth Fiegerman2014-05-01 19:00:25 UTC

The Launchpad is a series that introduces Mashable readers to compelling startups. If you would like to have your startup considered for inclusion, please see the details here .

Name: BookBub

One-Liner Pitch: BookBub helps readers discover deals on ebooks from genres they like.

Why It's Taking Off: The service is looking to broaden its focus from ebook deals to ebook discovery.

Josh Schanker and Nicholas Ciarelli are both quick to describe themselves as "outsiders" to the publishing industry. Schanker sold several startups in the social media and marketing space; Ciarelli is best known for running the popular rumor website Think Secret, which was shut down in 2007 as part of a settlement with Apple.

Then, three years ago, a mutual friend asked the two entrepreneurs for help marketing some e-books from relatively unknown authors. Though Schanker and Ciarelli didn't know each other before that, they recognized an opportunity to tackle the issue of e-book discovery and decided to work together on it.

See also: 10 Wicked Cool Boston Startups You Should Know

In 2012, they launched BookBub, a daily deal newsletter for ebooks. BookBub works with all five major publishers as well as hundreds of small and mid-sized publishing houses to get a comprehensive list of ebooks that are being discounted for a limited period. A small editorial team then picks out the best deals from the batch. Subscribers receive a daily email of the deals customized based on the genres and ebook retailers they've selected.

The startup is nearing 3 million members, drives more than 1 million e-book sales every month and generates revenue in the "seven figures" from commissions on sales and fees paid by publishers and authors to be included in the newsletter. What makes all that even more impressive is BookBub has been bootstrapped — until now.

BookBub announced Thursday that it has raised a $3.8 million Series A round of funding from NextView Ventures, Founder Collective and others. Much of the funding is intended to help the startup ramp up its staff of 20, build out the web experience and develop for mobile and eventually expand internationally. But part of the funding is also intended to help BookBub expand from ebook deals to ebook discovery.

"We feel there is an opportunity to solve the discoverability problem for readers and publishers that goes beyond deals," Schanker tells Mashable. "Part of why we are raising the money is to experiment with new products and features that will help build on top of what we already have with deals."

The problem, as Schanker explains, is that publishers rarely ever had a direct sales relationship with consumers. It was always mediated through the bookstore, which helped readers discover books and publishers get their books discovered. That has changed with the growing dominance of ebooks.

"Instead of just a bookstore's worth of books to choose from, you have every book ever to choose from," he says. "Authors and publishers have the same problem, if not even worse."

For now, BookBub is staying vague about how it will tackle the ebook discovery problem, but he says that promoting curated deals on ebooks has proven to be an effective way to help readers discover new authors whose works they go on to buy with or without a discount.

"We've seen the deals lead to full priced purchases," he says. "We think theres a lot more we can do as we build trust with readers and authors."

Have something to add to this story? Share it in the comments.

Topics: Business, ebooks, Media, Startups, The Launchpad