Sold Out: Eventbrite and the Marketplace Trap

Covid didn't kill Eventbrite. But a single strategic misstep unraveled its admirable post-pandemic rebuild.

I went quiet lately, mostly due to the war. My family and I are safe (we left Tel Aviv at some point and spent the last few weeks in the US), but it was still challenging to focus on business and tech during this time. I am not interested, however, in talking about geopolitics, and much rather go back to our regular programming. Let’s get right to it –

Business Traps

I thought of my favorite business analogy—the mouse who says ‘let me out of the trap, I’ve decided I don’t want the cheese.’ There are a million business traps. You can get sloppy, you can get alcoholic, you can get megalomania, you can not understand your own limitations. There are a million ways to gum it up.

- Charlie Munger, from Damn Right! by Janet Lowe

Once a Silicon Valley darling, Eventbrite completed its sale for $500M last month, bowing out at a valuation slightly lower than its pandemic trough.

What happened? It wasn’t Covid, if that was your guess. While it certainly has been a near-death experience for Eventbrite, former CEO Julia Hartz (who just stepped down following the sale) was able to navigate the pandemic and successfully rebuilt the company. Eventbrite generated record revenue in 2023, exceeding its pre-pandemic mark; but then, the collapse started.

A Winning Ticket

Kevin and Julia Hartz co-founded Eventbrite in 2006 with the vision of letting anyone create and sell tickets to live events. “Anything larger than a kid’s birthday party, and smaller than a U2 concert,” is how they described the addressable market. Things like bread making workshops, networking meetups, or wine tastings at your local cafe. Eventbrite was yet another classic case of an internet democratization story. By capturing – and in some cases, enabling – this long tail of live events they built a thriving ecosystem of event creators, pushing revenue past $200 million mostly by charging a ~4% commission on ticket sales.

While competitors kept popping out in different geographies and market segments, Eventbrite pulled ahead as the most feature-rich and advanced platform. It was an early integrator for Facebook’s and Spotify’s 3rd-party APIs, offering native ticket purchase experiences and best-in-class event marketing and management tools. Armed with a superior platform and a relatively large balance sheet, Eventbrite went on a global consolidation spree, absorbing local players such as Europe’s Ticketscript, or Latin America’s Eventioz. The M&A run peaked in September 2017 with the ambitious acquisition of Ticketfly – then famous for handling Burning Man tickets – pushing Eventbrite into music and live entertainment.

Valued around $3.4 billion following a 59% IPO pop in 2018, Eventbrite’s stock began sliding almost immediately due to a painfully slow Ticketfly integration leading to music venue churning. Just as the company began repairing those relationships, Covid halted live events altogether. Facing a complete revenue drop, Eventbrite slashed almost half its workforce, secured $100 million in emergency financing, and started rebuilding. Eventbrite survived the pandemic, coming out the other side as a growing business with a leaner cost structure.

By 2023 Eventbrite surpassed its pre-Covid revenue peak, when then-CEO Hartz unveiled an ambitious new vision: a “transformation into a 2-sided marketplace”.

A Live Events Marketplace?

CEO Julia Hartz reported on Eventbrite’s November 2023 earnings call:

We have successfully rolled out our marketing and demand generation tools to all Eventbrite creators. I’m excited by the momentum we’re building towards our transformation into a 2-sided marketplace, which will enable us to create more value in the long term.

Eventbrite was so excited about transforming from a ticketing software into an events marketplace, that it eliminated its free tier, requiring all event creators to start paying for marketing tools; Hartz explained the new pricing strategy to analysts in early 2024:

We’ve known for some time that we were operating as a platform, but really driving value as a marketplace, and that our demand generation for creators, which is the #1 thing they ask us to help them with, was strong and growing. Today, 47% of all tickets on the platform or in the marketplace [...] are driven by Eventbrite’s efforts, and 53% are driven by creators’ efforts.

So we knew that we wanted to lean into how we could build the marketplace at scale, because we know, again, that our customers, their top need is for us to help them build their audience and community and convert that community into more event goers. And so for us, it’s been a practice of building a product that matters. We rolled out Eventbrite Boost, and with that, a suite of marketing tools that allowed our creators to be able to be better, more effective marketers using those tools […] and then we also knew that as a marketplace, we needed to be able to monetize that demand. So there are 2 things going into that. The first is Eventbrite Ads, the ability to buy a promoted listing spot for the first-time ever in Eventbrite, so that we could drive the goodness of all the consumers and the traffic that we’re getting into our creators’ events. And the second is, the marketplace pricing model.

Eventbrite’s revenue model has been a per ticket transaction fee for 1.5 decades, on average, roughly -- and historically, it’s been $3 per ticket, 88% to 90% of the time, that’s paid for by the consumer. The creator wasn’t really paying anything for Eventbrite prior to this change. And so what we did was, after lots of research and design and testing, we figured out that we could exchange value based on the marketing tools, so we could bring those marketing tools that were hidden behind or were behind a subscription, and really only for our Enterprise-level customers, we could actually bring that functionality into the core experience, which is very Eventbrite.

Sounds compelling, right? The most powerful business models on the internet, which Ben Thompson defined in 2015 as Aggregation Theory, win by controlling consumer demand. Through offering the best discovery mechanisms in an era of internet-scale abundance, consumers are voluntarily returning to these platforms. Newspapers might loathe Google, and merchants might resent Amazon (and same for how drivers think of Uber, hosts view Airbnb, or musicians feel about Spotify). They all stay, however, because that’s where the users are. By owning demand, these marketplaces can dictate terms to their suppliers, who have little to do but to complain and comply.

But did Eventbrite actually have control over consumer demand? Were people instinctively opening the Eventbrite app when looking for a party or a concert, the same way they reflexively go to Uber for a ride? Analysts were skeptical. Eventbrite CEO Julia Hartz and CFO Lanny Baker, however, remained confident. They argued that creators leveraging Eventbrite’s marketplace tools were seeing a revenue bump that more than justified the price hikes. While acknowledging that some creators were leaving in protest, leadership dismissed the churn as a short-term knee-jerk reaction to the pricing change, and reaffirmed their double-digit revenue growth guidance.

The Aggregation That Wasn’t

With every quarter, however, Eventbrite’s miscalculation became increasingly obvious. Unlike Uber drivers, or publishers who depend on Google, event creators did have a choice. The backlash, which management viewed as a temporary protest, was turning into a permanent exodus. After peaking at 190,000 quarterly paid creators in mid-2023, Eventbrite saw a steady decline throughout 2024, driving down the platform revenue.

Source: Company’s Financial Statement

Complaints across Reddit revealed a stark reality: event creators preferred Eventbrite, but many refused to pay for it when free alternatives exist, no matter how basic. This was Eventbrite’s fatal strategic error. Much like how users would likely abandon Google if it charged money for search – in favor of an inferior yet free search engine – many event creators jumped ship. As it turned out, Eventbrite ads didn’t perform all that well – a venue was better off buying ads directly from Google or Meta – and, unlike a driver who quit Uber, event creators were able to generate demand on their own.

Hartz and Baker wrongly assumed Eventbrite had the leverage to commoditize their supply side, only to discover that their ticketing software was, in fact, the true commodity.

Management acknowledged the failure a year later, in an August 2024 earnings call. CFO Lanny Baker admitted that organizer fees had “disrupted creator acquisition and retention for longer and to a larger degree than we anticipated”, causing an “unacceptable and outsized impact on marketplace inventory, creator loyalty and ticket point”. CEO Julia Hartz also recognized the misstep, noting that the pricing model was the primary factor behind the ongoing decline in ticket volume.

“I’ve decided I don’t want the cheese”

Management abruptly reversed course. On that same August 2024 call, they announced the reintroduction of a free tier (with no marketplace fees) alongside a premium subscription offering, stating the change would “help us attract new creators and reconnect with those who have left due to pricing concerns.”

Eventbrite launched aggressive win-back campaigns. By November 2024, CEO Julia Hartz reported on “early signs of stabilization,” noting that returning creators were “trending more consistently with historical patterns.” When Lanny Baker was ousted at the end of the year — only four months after his transition from CFO to a new COO role, thus seemingly taking the fall for the failing strategy — it seemed Eventbrite may be turning the page on the marketplace debacle. In February 2025, Hartz noted “steady improvements”, and the new CFO guided for “continued recovery” with “paid ticket volume returning to growth in the second half of the year.”

It’s just that, management kept looking for signs of “stabilization” and “recovery” throughout 2025, as the business continued to deteriorate.

This is from Julia Hartz’s prepared remarks on the May 2025 earnings call:

While ticket volume was still down 7.7% year-over-year, it showed clear improvement over Q4... This was the plan. We knew this year would still carry the impact of last year’s organizer fee reversal. We’re managing through it and working to get back to growth in the second half of the year.

August 2025:

Year-over-year declines in paid creators, paid events and paid ticket volume all improved compared to Q1, which is evidence that the recovery is gaining momentum... As a proof point of our stabilization, paid creators and paid ticket volume were very close to flat year-over-year in July. This is a powerful signal that our recovery is taking hold.

November 2025:

[...] we saw a solid sequential improvement in paid tickets, down 3% year-over-year versus down 7% last quarter [...] paid events grew while paid creators were essentially flat, reflecting meaningful stabilization after several quarters of volatility.

More than a year after the reversal, Eventbrite was still hoping for stabilization. Just like in Charlie Munger’s analogy, it was too late: saying “I no longer want the cheese” (or the marketplace revenue, in this case) couldn’t turn back time and unlock the mousetrap.

In December 2025, Eventbrite announced its sale for $500 million; a price tag lower than its valuation at the absolute bottom of the pandemic, when its business ground to a halt. A single strategic misstep erased the value painstakingly created as the company rebuilt itself from the ashes of Covid.

It’s fascinating to imagine a parallel universe where Eventbrite avoided the marketplace hubris. Would it still be dominating its market as a growing, profitable business today — albeit smaller than Baker and Hartz dreamed of in 2023? Would it be worth more than $500 million? My guess is, yes. Which makes this a painful and important lesson for executives and investors.

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Disclosure: not financial advice, this post is for educational and general purposes only and should not be relied upon for investment decisions.