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Ben Drury: Yoto co-founder on audio, imagination, and screen-free design
00:50:33
In this conversation, we get into the design principles that came out of Montessori, their experience working with Pentagram on product design and branding, why Paul McCartney became an early angel investor, and what changes when you go from a Kickstarter that raised fifty thousand dollars to nine-figure revenue.
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- [00:02]
Ben Drury
These generation of children that have grown up over the last 15, 20 years have been kind of guinea pigs to the smartphone and the iPads and things like that. We're very pro tech and pro tech for good, but we just felt there was a better way of creating an audio experience for children.
- [00:18]
Aaron Walter
Like a lot of parents, I've struggled over the years to get my kids more into reading and away from screens. I wasn't necessarily on the search for a technological solution, but then an interesting device came our way. The Yoto Player, a screen free audio player for kids. My 10 year old son has been loving to read along to the Harry Potter books and I often find him after he falls asleep and the player still going. The story behind yoto is from a similar moment of parental struggle. About a decade ago, Ben Drury was shopping for a stroller in a London department store when he found one with an iPad mount built in for a newborn. He remembers the reaction being physical. This is just wrong. But if you're expecting an anti screen crusade, that's not quite what happened. The line Ben uses is we don't say screens are bad, we say audio is good, listening is good for creativity and imagination. And there's research going back to the 1980s to back that up.
- [01:14]
Eli Woolery
Ben is the co founder and CEO of yoto, makers of a kids audio player that works by dropping a physical card into a small speaker. Before Yoto, Ben spent about a decade
- [01:26]
Aaron Walter
building a B2B digital music platform called
- [01:29]
Eli Woolery
Seven Digital, which he took public. What he learned from that experience proved useful as he and his co founders started yodo. Ben and his co founder became parents at roughly the same time and wanted
- [01:41]
Aaron Walter
a way for their kids to connect with music and books like they did in their childhood.
- [01:45]
Eli Woolery
So they started hacking on Raspberry PIs with almost no hardware experience whatsoever.
- [01:50]
Aaron Walter
How hard could it be, right?
- [01:52]
Eli Woolery
Well, it turns out it's pretty hard. They took a restrained approach to the product design.
- [01:57]
Aaron Walter
Yoto's a cube because it was the
- [01:59]
Eli Woolery
simplest shape that they could think of. It uses NFC cards that have a Pokemon card feel. The 16 by 16 pixel display presents fun art that gives Yoto this great personality. In this conversation we get into the design principles that came out of Montessori, their experience working with Pentagram on product design and branding, why Paul McCartney became an early angel investor, and what changes when you go from a Kickstarter that raised $50,000 to a nine figure revenue company? This is Design Better where we explore creativity at the intersection of design and technology.
- [02:35]
Aaron Walter
I'm Aaron Walter and I'm eli Woolery.
- [02:38]
Eli Woolery
At DesignBetter, our mission is to produce work that helps people like you refine your craft, improve your collaboration skills, and learn from the creative process of others. If you enjoy what we do here, the best way to support us is to become a paid subscriber@designbetterpodcast.com subscribe. You'll get access to our Slack community, where there's amazing people helping one another, our library of ebooks, and every podcast and post that we publish. Visit designbetterpodcast.com subscribe to learn more.
- [03:17]
Aaron Walter
We'll return to the conversation after this quick break.
- [03:23]
Eli Woolery
DesignBetter is supported by Framer. For years, shipping a website required a really complex process, maybe a team of people involved, and a launch could take weeks. But Framer changed all that math for me. Framer's a pro website builder with AI agents built right into the canvas. They draft pages, manage CMS content, handle all the SEO for you. You inspect it all, review it, edit and decide what goes live. Agents bring the speed. You bring your own personal taste. That's why teams at Miro and Perplexity build on Framer. It's an incredible platform. Builds production ready sites published in minutes, not days. Learn how you can get more out of your site from a Framer specialist or get started building a site for free today@framer.com DesignBetter for 30% off a Framer Pro annual plan. That's framer.com DesignBetter for 30 percent off rules and restrictions may apply.
- [04:24]
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- [04:53]
Aaron Walter
And now back to the.
- [05:00]
Ben Drury welcome to Design Better.
- [05:02]
Ben Drury
Thank you Eli. Great to be here.
- [05:04]
Aaron Walter
We're quite excited to have you. I hadn't actually heard of the product Yoto until your team approached us and I was very curious about it. You kindly sent us some of the devices which we have here. The big guy and the little guy. I'm sure we'll get into more of the specifics there, but I just wanted to say before we start that I've been really delighted with them. My son's probably the older end of the range where these devices are designed for. He's 10 years old, but he's really been loving the audiobook Function. And so he's been reading Harry Potter and both listening and reading along with it, which is really cool. I have been having a hard time to get him to read a lot, which is a little frustrating for me because I was a huge reader at his age. But this device has actually I think helped him like get more into it. And this testimonial is maybe you want to capture this somewhere and share it because he has an allowance and he always just spends it on video games. But I said, you know, you can spend part of your allowance on a Harry Potter book if you want. He's like, yeah, I want the audiobook. And so I think that may have been the first non video game that he's ever spent.
- [06:04]
That's pretty amazing. That's pretty cool. 10 year old boy is like, hey, I'd like to buy a book, not just another video game.
- [06:10]
Yes, yeah, absolutely.
- [06:12]
Ben Drury
That's incredible. My boys are 10 and 12, so I can relate to that. And yeah, Harry Potter is still a big hit and that, you know, the last book is 36 hours long, so it keeps them going.
- [06:22]
Aaron Walter
That's great.
- [06:23]
Ben Drury
Yeah, love it, love it.
- [06:25]
Aaron Walter
So we're going to kind of, I'm sure, get into the background of this and what got you interested in starting this product company. But maybe a good place to start is a quote that we dug up, I believe, something you said. We don't say screens are bad, we say audio is good, listening is great for creativity and imagination. So maybe use that as a lead in to talk to how you kind of started this journey.
- [06:46]
Ben Drury
Yeah, thanks. That's a really good way to start because when we were kind of researching this, we found a really old science paper from like the 1980s and it talked about how audio and listening was better for creativity, imagination than video based content. It's kind of common sense because obviously the pictures, the moving image does a lot of the work for you. Your brain hasn't got to work as hard, but it's always good to have something in scientifically peer reviewed, validated paper. There was also then some research. We met this professor at UCL here in London. He connected some research with Audible. It wasn't for kids, but they were wiring up adults to brain sensors. There was like a scene in Game of Thrones and they were paying them the audio version. One group and one group, they were playing the video version. Obviously Game of Thrones is a pretty visual feast. It's very visceral, lots of violence, etc. But they proved that the brain activity in their Kind of imagination area was way higher for the audiobook version because the brain had to do more work. So that was super interesting. The real reason we started yoto honestly was very selfishly because my co founder and I both started a family around the same time. And selfishly, we wanted a solution for our own children to be able to listen to audio, but with them in control. That was the key. There was plenty of ways to play audio through Alexas and through Sonos and smartphones and things, but we really wanted to put the child at the center of the experience. Previous to yoto, I had a different startup in the digital music space. Company called Seven Digital is a kind of digital music B2B platform business. They did that for about 10 years. And we worked for a lot of hardware companies like Samsung and HTC and HP and even BlackBerry when it was a thing. We helped them do a music Service. Everyone's forgotten BlackBerry now, but it was a big deal back then. Took that company public and had children. And we'd never done hardware before. We'd never created a physical product. And our naivety maybe helped us because we were like, oh, how hard could it be? It turns out it's pretty damn hard. But we got stuck in and we started hacking away with Raspberry PIs and we built a prototype of a simple physical interface to allow children to have control of listening experience. And that was really the beginning of the idea.
- [09:04]
Aaron Walter
I think that insight about letting the children have control is such a great design constraint for two reasons. For one, just letting the kid run off and do their thing, explore and listen to books, like I mentioned my son does. But also for the parents, it's great because you're like, I'm very guilty. And I'm sure Aaron has been too over the years, getting to a point where like, I just need some time with my wife or to myself, and here's a screen. Go off and entertain yourself. And I think you feel a lot less guilty with like, okay, here's a device. Go, go off and read a book or listen to music and you control it. So it really works for sort of both sides of the equation.
- [09:38]
Ben Drury
We also heavily influenced by Montessori. So my kids went to a Montessori nursery from quite early on, from about age 1. And as part of that, there was this kind of slight indoctrination program where parents had to do this Montessori training. We had to kind of go to night school and get immersed in Montessori. It was a little bit brainwashy, but it was Quite fun. And actually the design principles, I guess from Maria Montessori really struck a chord with me because it was all around independence, autonomy, choice and the physical experience, the physical objects and having very tangible physical things. And I think we took all of that thinking and that philosophy forward into yoto. There was one other terminal moment as well on the slightly anti screen side was I was shopping for a stroller or a pram as we call them here in John Lewis, which is a big department store for the baby, for the kid. And there was one on the market that had an iPad attachment built into it. This is for a newborn or one year old child. And I remember having a very strong visceral reaction against that saying this is just wrong. How could you do that? And then it struck me also that these generation of children that have grown up over the last 15, 20 years have been kind of guinea pigs to the smartphone and the iPads and things like that. So it was all of those combinations. We're very technophile, we're very pro tech and pro tech for good. But we just felt there was a better way of creating an audio experience for children.
- [11:14]
Aaron Walter
So for our listeners who maybe have not yet seen what a yoto device looks like, it's kind of a box, it's got a handle, it's very portable, which I think is smart because you know, I think of my kids when they were little and how they moved around, they sort of grab a thing, they go over here, they're making a little tableau of their toys, they're doing stuff over here and then they move
- [11:35]
Eli Woolery
on to something else.
- [11:37]
Aaron Walter
It's almost like a personification in the design that it's got these two knobs on the sides that kind of read like ears, antenna, something like that. And there's this screen, not a screen, it's sort of like a light up matrix or something like that. They can make a little emoji, little icon. Could you take us into the design process for the object itself and then maybe speak about the design principles that guided the decision making process?
- [12:06]
Ben Drury
We have just two products. We have what we call the yoto Player which is the original product and then the YOTO Mini. I'll talk about base. The yoto Player was the original product and we decided on a cube format as the form factor mostly because that was the simplest object we could think of. And I guess as non hardware people we wanted to keep it simple, we didn't want to over complicated it. The very first version of YOTO was launched on Kickstarter. At the end of 2017. So we ran a small Kickstarter campaign that's still live. If you search for yoto Kickstarter, you can still see it. That was quite influential. And then we chose the idea of a format using an NFC card. This was a format we chose again through kind of simplicity. We knew that cards were a good user interface for children because they are eminently kind of collectible. Kids have always collected cards in some way. They are very robust. It's the same, essentially the same technologies we all have in our wallets with credit cards and hotel key cards. They can survive full washing machine cycles and things like that. And they're also pretty inexpensive to produce. And also child safe. Children put things in their mouth. So we had to make some design decisions around plastics that we used to make sure it was child safe. But essentially the big user interface decision was the observation that children love putting things into things. You know, anyone's watched a one year old, they just spend hours just putting things into things. They just love that.
- [13:37]
Aaron Walter
You know what my son used to do? He used to take watermelon cubes and put them in the little crank out handle for the windows and then smash it in there. So I can corroborate your information. Like, children like to put things into
- [13:50]
Ben Drury
things, especially things that are difficult to clean, I guess.
- [13:53]
Aaron Walter
Yes, they love it.
- [13:55]
Yeah.
- [13:55]
Ben Drury
So that was the basic user interface. And in a way, I feel like if we'd have been real hardcore industrial designers or mechanical engineers, we may have designed something more complicated. But that was our insight. So we got going with the Kickstarter campaign and that gave us enough data and evidence to see that this was something that works, fundamentally works. And the basic principle is you put the card into the player and it starts playing and you pull the card out and it pauses. Young kids will do that endlessly. In and out, in and out. So had to auto pause. We also made an early decision to include. Even though we were kind of pitching this as screen free, we did make a decision that having a visual element to it would give us so much more power to create educational content and really illustrate the audio in the same way as an illustrated book. So we decided to incorporate what we call a pixel display on the main player here. It's an LED grid, 16 by 16, 256 pixels. So ultra low res. And it seems to appeal nicely to adults because it has that kind of retro video game feel. And kids just like simplistic blocky graphics anyway. I think that's well proven from Lego To Minecraft, to all sorts of things.
- [15:07]
Pepsi Ad Voice
Things.
- [15:08]
Ben Drury
It's actually amazed us what you can do with 16 by 16 having that design constraint that's used quite a lot of color depth, which helps. So there's a lot of color depth within that. But having that design constraint was crucial. We've got this incredible icon designer who spends ages handcrafting these beautiful pixel images. And even in this world of AI, you know, we've tried all the different AI models, they can't create amazing pixel art. They really struggle. They're much better at creating full resolution, wonderful AI images, but they can't create our pixel images. So they're still handcrafted. And there's a whole community creating these pixel art for Yoto. This website called yotaikons.com, which was set up by someone completely independent from us and it's a whole repository of icons that people designed for yoto. Because with yoto you can create your own cards. As well as listening to Harry Potter and listening to the Beatles and listening to K Pop Demon Hunters, you can also create your own cards. That was an early decision as well. And that was also crucial because we knew that families would always have their own content. They'd always have grandparents wanting to record stories, they'd always have the music lesson, the school play to learn. They'd always have something that we wouldn't necessarily have in our catalog. So that was also an early design decision. This was a Kickstarter campaign in 2017 and then we started shipping that in 2018. Then we started working on the more commercial product which is the one that we released in Covid. So we actually kind of commercially launched Giotto in February 2020 in the UK and then in the US in June 2020.
- [16:40]
Aaron Walter
Was that good timing for you? It seems like it could be perfect that people are trapped at home with their kids and like, let's keep them busy.
- [16:47]
Ben Drury
At the time it felt awful because we all thought the world was ending and it was terrible. We hadn't raised much money, so we didn't have much Runway. I remember we all took very big pay cuts at the time to preserve the Runway. In hindsight, maybe it did help us because people were stuck at home doing zoom lessons and parents started seeking out screen free solutions. And certainly I think in August that year 2020, we started to see a significant boost in our numbers. So it may have helped us. We will never know, frankly. We followed up the main Product launch in 2020 with the launch of our portable product, Yoto Mini or more portable this one is also portable. It's battery powered, but we followed up with Yoto Mini, the smaller, more travel version, at the end of 2021.
- [17:36]
Aaron Walter
We'll return to the conversation after this quick break.
- [17:42]
Eli Woolery
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- [20:44]
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- [20:46]
Aaron Walter
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- [21:18]
Aaron Walter
And now back to the show.
- [21:25]
You mentioned towards the beginning about the challenges of designing a physical product, which were maybe unexpected. I started my career in physical product design, so I could probably relate to some of those challenges. And in my case, I was designing products. There were camera housings to go underwater, so we had the challenges of depth and pressure, making a prototype challenging in itself, but you could do that. But then trying to manufacture that at scale, all sorts of other issues could come about. I'm curious for you. You probably had even some more challenging constraints and diving equipment, children that might choke on something. So you have to be very careful about parts that could fall off or the fasteners you use and that type of thing. But maybe talk us through some of the design challenges and product challenges you had along the way and how you overcame those.
- [22:07]
Ben Drury
Yes, indeed, we've had plenty of challenges along the way, from manufacturing challenges to boats getting stuck in the Suez Canal, to factory fires in China, to all kinds of supply chain things. And right now there's a memory pricing crisis going on. So I've kind of resigned myself to knowing every year there'll be something. Tariffs as well, U.S. tariffs. That was another one last year. Hardware is hard, for sure. I've learned that that's a complete truism. But if you get hardware right and you have this unique interface into people's lives that becomes embedded into a family routine and it's incredible. And the usage rates that we get are amazing. Thankfully, you know, as a parent, thankfully, lots of regulations, specific children regulations, and those regulations are not consistent across different markets. For example, in California, there's some very particular requirements that don't exist everywhere else. But a lot of it's down to choice of materials, making sure that BPA free, making sure that the plastics were child safe, food grade, making sure the audio was not too loud, so headphones for damaging hearing, making sure the light output was not too bright. It could have strobe effects. Obviously drop testing, because children like to throw things around. So we do much more robust drop testing than the regulation state. We haven't done any water resistant stuff so far, so we haven't had to worry about that. Children do drop things in the toilet and in the bath, so they like
- [23:36]
Aaron Walter
to put things into things, including bathtubs and toilets.
- [23:39]
Ben Drury
Absolutely. So, yeah, we tried to make sure our products are as robust as possible.
- [23:45]
Aaron Walter
One thing that occurred to me that is very different with this type of industrial design project compared to many others is it's aimed at childhood development. And so you want to have the product design grounded in strong childhood psychology principles. Were you consulting literature? Did you have experts on the team who guided the design decisions? How did you bring that into the design process?
- [24:13]
Ben Drury
Honestly, no. We didn't have any specific experts around education or learning development. We did rely a lot on gut feel. We worked very closely with our industrial design partners, Pentagram uk. John Marshall was our partner and him and his team were a big part of the process for designing both these products. We built up a really great relationship with them. John had particular experience of designing other children's products. We were able to lean on that experience and our own lack of experience. Although I have to say, one key person was our first ever hire after the two founders was a guy called Tom Borehatchett, who was an industrial designer by training. And he'd founded a business called Bounce Pad, which makes enclosures for iPads. Imagine when you go to a museum and you see an iPad that's enclosed. That could well be Bounce Pad. So Tom was a crucial hire. So working with Tom and working with Pentagram really allowed us to involve the industrial design and make it very much kids in control. But there was actually one very important principle that we all agreed on very early on that we didn't want to make the product too kiddie. We didn't want to make it look like an animal. We saw Amazon's Echo Dot for kids, which honestly, for me is awful from a design perspective. It's very Lazy. You have two versions, one that looks like a panda and one that looks like a tiger, I think. And basically it's just a repurposed echo dot that was designed for adults. Oh, let's make a kid's version. Let's just make it look like a tiger. For me, that was really lazy design decision. We actually went the other way. We said, look, we want this to be obviously a product built for children from the ground up, but we kind of want to make it a beautiful object as well that adults wouldn't be embarrassed of. We had this idea that if the adults were having a dinner party, would they want to put this away, would they want to tidy this away, or would they actually be happy to have it on in the corner? That was a test that we used a lot.
- [26:12]
Aaron Walter
Honestly, that is one of the reasons why we decided we definitely need to talk to you on the show was because the industrial design has sort of a Dita Rams Braun heritage feel without being super overt and without being so clinical. The edges are rounded a little bit. You know, you get some radii, some softer materials. It feels like a cool object that you want to have in the house. And look at one of the things that definitely caught our attention was you want to look at this longitudinally to see how it affects childhood development. I'm curious how you're doing that, but I wanted to share an anecdote that some friends of ours who live in la, they have a two year old who has a friend who's six and this boy has a yoto and he's had it for, I think, since through the pandemic. The parents told me that it's the only toy that he's stuck with from two to six. And anyone who has kids knows that those development stages are vastly different, like from month to month, year to year. That's a very rare thing that you would have something that would stick with you, maybe like a blanket, maybe a teddy bear, but that's about it. And those are simple objects. So how do you look at this longitudinally?
- [27:28]
Pepsi Ad Voice
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- [27:29]
Ben Drury
I want to pick up something you used. It was interesting. You used the T word. You used the toy word. That was another interesting observation that we made early on when we started designing Goto was that we went to the London Toy Fair. We kind of realized that what we were building is not a toy. And we've kept that principle. It's not a toy. And then we were like, well, what is a toy? How do you define what a toy is? And I think something you play with. And we came up with this simple thing like is this something that will get tided away in the toy box? And if the answer was no, we want the answer to be no, then it's not a toy. So I think that anecdote kind of backs that up. It's something that lasts a long time with the family and changes and adapts. A two year old will use the product in a very different way to a five year old, a six year old, a ten year old. A lot of it's obviously down to the content itself. What we see in our data and our sales is a very young child might listen to. One of the most popular cards is the Gruffalo. It's about a 10 minute long audiobook and they tend to listen to it again and again and again and again, maybe ad nauseam for the parents. But what we see is when children get to age 4, 5, they don't tend to want to listen to the same thing over and over again necessarily. They want to consume more and more content and longer content. And it really depends on the child as well and the family. But music becomes more interesting at different ages. Podcasts. We also have podcasts, kids podcasts on yota. We have radio stations and now we have things like interactive adventures. So we have a Dungeons and Dragons for your quest, which is kind of a choose your own adventure style thing where the children have to use the buttons, they have to use the physical hardware interface to make choices. And there are 26 different endings in the story. So this is something we're doing more and more of, where we're actually using the hardware interface to interact with the content. So rather than just being straight linear, we're using the physical interface. And for me, that's a really exciting new area that we're getting into.
- [29:30]
Aaron Walter
Ben, to your point of this being an object that you don't want to hide away. So the larger device my son is mostly using, and then the smaller one my wife is like, oh, that's so cute, I love it. And she actually keeps it on our nightstand and uses it for sleep sounds. I made one of those personalized cards that just has the sleep sound on it. And another part of it that's so delightful is it comes up with this little graphic which is like the mountain stream. And there's something relaxing in that in and of itself. And I'm curious if you're seeing are other parents doing similar things or like, actually, well, maybe my kid's not using one of these so much anymore or I'm going to use it or does it kind of evolve and it's something that the family continues to use even after the kids might have aged out of it.
- [30:13]
Ben Drury
We do see a lot of family listening and we find that great. We have a free daily podcast with the player where you just press the right hand button and it plays YOTO daily. And there's a lot of family listening, family time listening. There is even a Facebook group called yoto for adults. It's a small group, but there's definitely some use cases for adults.
- [30:32]
Aaron Walter
It's interesting, Ben, Eli and I both, we grew up born in the 70s and we both had record players, like little 45 record players.
- [30:41]
Ben Drury
Me too.
- [30:42]
Aaron Walter
And I would get those books. It comes with a little 45 record. And I remember very distinctly the Hobbit. I had that book and I would look at the book while I listened to the Hobbit. I was into JRR Tolkien before I could even read JRR Tolkien. I would sit in my room for hours and just play it over and over again. I loved that.
- [31:01]
Ben Drury
Absolutely. And it's been proven that you can listen to the audio version of a story at least a couple of years before you hit the average reading age. And that was actually one of the important things. When we started working with the Harry Potter team, they recognized that it was a great pathway into the Harry Potter world. Listening to you call it the Sorcerer's Stone. I think in America we call it the Philosopher's Stone here in.
- [31:24]
Aaron Walter
Yeah.
- [31:24]
Priceline Ad Voice
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- [31:24]
Aaron Walter
Why do they change it? Why isn't it just the one?
- [31:26]
Ben Drury
Whatever. It's crazy. And yeah, kids can listen to that from maybe age 4, 5. Some kids age 5 could read that book, but most 5 year olds wouldn't be reading that book. So it's a nice pathway in. And in the Harry Potter's team's mind, that's the best way to start with Harry Potter. Rather than go and watch the movie, they would prefer you to maybe listen to the audiobook first, then read the actual physical book, then watch the movie. And we tried that with our kids, actually. We really tried to make sure they read the books before the movies. I think we had to give up after the fifth book. We skipped to maybe the movie after that. But they were pretty good at reading those books.
- [32:04]
Aaron Walter
And you're right next to King's Cross. You kind of have to read those books.
- [32:08]
Ben Drury
Absolutely. We're surrounded by Harry Potter.
- [32:10]
Aaron Walter
Yes.
- [32:11]
Ben Drury
Here in London.
- [32:12]
Aaron Walter
It's awesome. As a quick aside to Aaron's story about the record player, I remember as a Kid, I definitely listened and read the Hobbit as well. Sticks in my mind. But there's another one. I was just looking it up. It's Conan the Barbarian and there's a comic book and it's the Crawler in the Mist. And I just remember how atmospheric it was and kind of spooky and. And you wanted to go back to it. And part of that was probably like the scratchiness of the record player too, as it's playing. It sort of sets the mood. But, yeah, I love this idea that kids can get so drawn into the audio and use their imagination. And we had a guest recently, Daisy Fancourt, who talks about the healing power of the arts and experiencing the arts. And you can experience the arts through a screen and get some small amount of benefit, but if you're drawing in your other senses, if you're experiencing it directly or listening, you're just getting so much more out of it than you are of just plopping yourself in front of a TV or an iPad.
- [33:05]
Ben Drury
I'm also a child of the 1970s, 1975. My first experience of Star wars was actually watching Return of the Jedi in the cinema when it came out, I guess somewhere early 80s. And then I went backwards and we had Empire Strikes Back on cassette tape in the car. And I have strong memories of listening to that in the car. So audio has always been a big part of my life, and it's great to be bringing it back in a way to the next generation. And I just wanted to mention something else that we were touching on YOTO for adults. There's also been a really interesting use case of YOTO for older people. We've seen a lot of cases where people are buying their YOTO players and recording cards or setting up cards for elderly relatives who maybe have dementia or maybe struggle with modern technology. The simplicity of yoto, which works so well for children, also works for elderly relatives. And so we've seen lots of usage of YOTO in care homes and for those elderly relatives. We didn't design for that. And we do keep yoto really as a children's product, but it's a nice byproduct that is also being used for the older generation.
- [34:12]
Aaron Walter
Let's talk about the challenges and the realities of running a business like this. So you did a Kickstarter campaign, successful in that it gave you some funding to get things moving. You had some Runway and so forth, but eventually you had to go courting investors. What was that like trying to find the right investors and telling your story? What did you learn from that process?
- [34:35]
Ben Drury
The Kickstarter campaign was pretty modest. We didn't raise much, around $50,000, which is not a lot of money for a Kickstarter campaign. But then weirdly, you see these Kickstarter campaigns that raise millions of dollars and that actually can cause companies a big problem because suddenly they've got to scale up to a lot of units where they probably haven't figured things out yet. So for us, that was pretty nice. In the first version of yoto, we actually made, we kind of handmade it up in Sheffield, north of the uk. It was clearly not the scalable product, but it was a stepping stone really to the next generation and it helped us raise money. We managed to get on board some really amazing investors early on, including Paul McCartney, the beetle.
- [35:15]
Aaron Walter
That's amazing.
- [35:16]
Ben Drury
He was one of our early angel investors and I remember going to meet him and being absolutely petrified. I've pitched to lots of investors in my life, you know, top Silicon Valley, Sandhill Road type guys. But Paul McCartney was the one I was the most nervous with. He was then the most relaxed, chilled guy. He loved it. I demoed the very first version of YOTO in his office in London and even the demo didn't go that well because his office wi fi was a bit funny. He had some great product advice, which is amazing, and he helped us get the Beatles onto yoto, which is really hard.
- [35:51]
Aaron Walter
Oh, that's incredible.
- [35:53]
Ben Drury
We have kids versions of the Red and the Blue album. I think the reason that he invested was that he had written a kids book for his grandkids called hey Grand Dude. And we went to see him at the right time and it was in his mind that kids audio is a thing. So he invested and he helped us a lot. His name opens a lot of doors from that period onwards. After we'd got the Kickstarter campaign, we then started to raise money from classic kind of VC types investors. In the early days they were all from Europe, and then later on we got some US investors as well.
- [36:27]
Aaron Walter
There was a kind of an inflection point and hopefully this wasn't a research mistake or a hallucination in that AI assistance we got in doing the research here. But there was a jump in your revenue from 2023, from £27 million roughly, to £94 million. What drove that? That must have accelerated things in a good way. But how did you deal with that transition when there was a big scale up in demand?
- [36:49]
Ben Drury
We have been scaling pretty fast and that does bring with it its challenges with Hardware, especially with yoto, because any kids product tends to be quite seasonal. You will sell a lot in Q4 and particularly around the Black Friday weekend. That brings its own challenges because that means you have to do a lot of manufacturing in the summer, get things on boats and then hope it sells. So you know that brings a lot of kind of working capital challenges. But we've become very good at that. We have very strong support from banking partners in order to manage that. In the early days, because we launched in Covid, we were selling everything direct, so everything was being sold on our website and it was a lot driven by word of mouth. We weren't doing too much advertising, then we launched on Amazon and then we've only really in the recent years we've gone into retail and we're now in 1900 Target stores for example across the US and there's some other retailers coming on board as well. That brings another set of challenges working with retail partners. But they can be amazing, like getting your products in front of people. Every step of the way. We've had new challenges. We're now in significant nine figure revenue territory, which is great. It allows you to do more, you can hire more people and you can do more. But it also brings other challenges. So for me it keeps it interesting. I've had to learn so much. My previous business was never anywhere near as successful as this one. So I've had to keep learning myself as a founder, CEO. But honestly I've always been happy when I'm learning. If I stop learning then I probably not happy at all.
- [38:22]
Aaron Walter
Amen. I feel the same way. Can you maybe take us into some of those challenges? What are the things that you're struggling with the most right now? As a CEO and founder, I think
- [38:31]
Ben Drury
what I've learned a lot is that when the company gets to a certain size and we're 220 people now and we operate, we have a team in Brooklyn, New York, we have a big team in the uk, we have a team in France, we have a team in Singapore, a team in Australia, a team in China. There's certain type points where you hit a certain number of people and you need to kind of restructure. You have to have bit more structure in place those periods of time, quite challenging. Sometimes you have to say goodbye to people that are brilliant, people that were really great for you when you were smaller, but they're not now the right people anymore. Those are very difficult challenges. I definitely didn't lean in enough in some of the earlier phases to the people and organizational things, I kind of just let them happen and then realized that actually a big part of my role is to kind of try and shepherd that and to make sure that we've always got the right people. Because I think now, I think we've proven we've got a great product. The classic product market fit is there, definitely exists. That doesn't mean we can sit still. We were always trying to innovate and evolve the product, but we've got the product. It's all about execution now and making sure we have the right team work in progress all the time. All the time.
- [39:38]
Aaron Walter
You mentioned the Paul McCartney partnership, which is amazing story in and of itself. And you have some other partnerships with Disney and Lego that are traditionally probably a bit gun shy from working with a new startup or somebody they're not familiar with. How did you get those conversations going and what might you be able to offer them that these bigger companies like Netflix might not be able to?
- [39:59]
Ben Drury
I came from the music world, so I've got quite a lot of experience of dealing with quite complex licensing. Music licensing is honestly the hardest type of licensing because of collecting societies, performing rights organizations, record labels and lots of different territory rights. Very complicated. I always say the music industry doesn't do itself any favors. It doesn't make it easy to work with because of its arcane licensing rules. And we have music on yoto, but the main consumption, the mainstay of Yotto is stories and the spoken word, including non fiction. So our major content partners as well as the record labels are the publishers, the book publishers, so Penguin, Random House, Macmillan, Scholastic, those kind of people. And when I first went to see them, I didn't really know what to expect. My experience had always been with music, dealing with the music record labels, dealing with them in the kind of Napster era where it was very difficult and they always wanted to charge you huge advances and things like that. So when I went to see the publishers, I was blown away, first of all, how positive the reception was and how easy it was to work with them, honestly, because there was a couple of reasons. One that I realized, one was that kids audio had been an underserved market for a very long period of time in the physical book world. About 20% of sales of books overall are children's books in some form. But in audio it was single digit, low single digits in audio. And the main reason was audible. Audible had a monopoly position in audiobooks and I don't think it has anymore because Spotify has become a big player and other companies become big players. But. But for at least a decade, maybe 15 years, it was essentially a monopoly. And people with their experience of kids audio on Audible wasn't great. And people didn't tend to use their credits, their credit model. They didn't tend to use them for kids audio because they're shorter. So when we went to see the publishers, especially where they'd already invested in these amazing audiobook assets with these amazing narration, they were really, really open to it because it was just a new distribution channel and it was kind of easy for them because I just had to hand over a bunch of digital files, sign in a licensing agreement, and then watch the money roll in. Generally, it was easy, a little bit harder with companies like Disney. You know, Disney is such a powerful company, but we built up a good relationship with them and we were able to license not only the classic Disney stories, but also Marvel, the Marvel titles, big hits on yoto and. And Pixar and Star wars as well. So we're able to get all of those things from Disney. One title I just wanted to mention was when you think about audio, sometimes it surprises you what can actually work. One of our best engagement cards is Minecraft. We have a Minecraft card narrated by Jack Black. And this was out before the movie. Before the movie came out, it was available in audio. It's just brilliant writing to creating this wonderful story. I think it's about six hours long as audio around the Minecraft world. But an audiobook about a computer game, that can work. It blows my mind.
- [43:06]
Aaron Walter
My son's going to love that. That's on the list for him for sure.
- [43:08]
Ben Drury
Hugely recommend it.
- [43:09]
Priceline Ad Voice
Yeah.
- [43:11]
Aaron Walter
I think it's interesting when you build a business like this, figuring out the different revenue streams and models and so forth. Amazing the licensing stuff that you've done. So kudos. I mean, you really have hit all of the big players in terms of the types of content that a lot of young people would want to listen to.
- [43:30]
Ben Drury
There are a few gaps, but.
- [43:31]
Aaron Walter
Okay, okay.
- [43:32]
Ben Drury
There's some very big releases this year. I can't tell you what they are, but we're very excited about the release schedule this year.
- [43:40]
Aaron Walter
You talked about how Audible's model with credits didn't work for kids. You have been experimenting with a club where you pay a monthly subscription and you get new cards shipped to you. Could you talk to us about experimenting with different revenue streams and how to engage customers in new ways, keep them in your ecosystem. And that's pretty awesome to go from. You buy a yoto and then you Go use it for six years. But we only captured the initial purchase. This is a subscription that really changes a business.
- [44:18]
Ben Drury
When we built the business, we thought we didn't want this to be a pure play hardware company or a pure play hardware business. We knew that would be really challenging and also the price of the product would be really, really high. So we wanted to keep the product price as low as possible. And essentially we don't really make our money on the hardware product. I'm a big fan of Nintendo, so the Nintendo model is probably the best analogy that I've come up with. Some people like to say it's a razor blades model. I hate that because razor blades are consumables and it's not the same sort of thing.
- [44:51]
Aaron Walter
Not as cool as Nintendo.
- [44:52]
Ben Drury
Yeah, I like Nintendo because obviously they sell their devices, the Switch and then the people buy the games. They also do have a subscription plan as well. But they also create amazing ip, Mario, Zelda, et cetera has kept them going through multiple generations of hardware and arguably has saved them over the years. And as well as licensing content, we do create our own YOTA Originals ip. We have one series called Brainbots which is really popular. It's kind of learning series. Kids learn about volcanoes and the natural world and outer space exploring, et cetera. And that's been incredible for us. And then on subscription side, we knew that YOTO wouldn't naturally lend itself to being a kind of subscription only business like Spotify or Netflix, just because the nature of licensing and the nature of the physical product. But we did want to have choice for customers in order to purchase content through yoto. So most people will just buy cards either as a single card for a single story or a card pack which could be a group of stories or a group of music, etc. Things like phonics. We have a Phonics learning set as well. Our subscription plan is brilliant for people wanting to build a collection because you get two things with it. Essentially you get access to a digital library of content which you can access and you can link that digital content to blank cards. So you still got the physical card. And then you also get credits as you mentioned, which is a really cost effective way to build a library. And so we do have hundreds of thousands of subscribers who choose to join us that way. It's kind of like a Amazon prime style model. You get free shipping as well with that.
- [46:26]
Aaron Walter
I'm curious about your advisory board or your board. What got me curious about it is that there's a sort of coincidence where the class that I teach, I'm involved in rounding up all the coaches that we have for our student teams. And I was telling Aaron, these students get amazing coaches ranging from the guy that invented the Clover coffee machine, Xander Nosler that was acquired by Starbucks, to the CEO of Heath Ceramics. So folks that have really deep industry experience all around. And just this year I was approached by he's a Stanford alum named Jesse Dorgesker. When I was looking at his LinkedIn profile I was like, wow, he's an amazing background but he's on your board and he was at Apple and engineering for a long time and looked like he was CEO of Tidal, the music company. So talk to us about him where folks like him have been helping you along your journey.
- [47:12]
Ben Drury
A couple of years ago I realized that my board had some brilliant investor board members and they've been really helpful, obviously investing their money but also giving us advice along the way. But we got to a point where we were hitting certain significant scale and they didn't necessarily have some of the operating experience that I was wanting. So I started on a quest to get on some independent non exec directors and I hired two from the U.S. first was Jody Kelman who was a very early employee at Lyft in San Francisco and ended up running a huge product engineering custom org Around,000 person org went through the IPO of Lyft and then left and moved east to New York. So she joined our board and someone who'd been through that whole scale up journey and she's an incredible product brain, more on the software side rather than the hardware side. And then I thought I need someone with hardware background here. Both us founders had never built hardware before and we're doing several million units of hardware now, so maybe a hardware expert would be good. And I got introduced to Jesse Dorogoska by a friend in London who'd worked with him at Square, he was with Square Strip Block Jack Dorsey, he was head of hardware there after Apple. I think it was eight years at Apple running the entire accessories business. So the made for iPhone program, which I think originally it was a made for ipod program, he was instrumental in that and that was super relevant to us because we do have an interesting accessories business and we have hundreds of people making third party accessories for yoto on Etsy. If you go on Etsy and you search for Yota you see like 800 results of people making all kinds of 3D printed add ons and things. So I wanted someone who'd got harder experience, experience of Accessories. And then it just so happened that Jesse had also been the CEO of Tidal, as you mentioned, so he'd got some deep content experience and he left all of that. We just managed to get him at the right time and persuade him to join our board. And he's really added a completely new dimension to yoto and we've leaned a lot on his deep, harder experience. So that's been great.
- [49:16]
Aaron Walter
Ben, what have you been reading, watching, listening to that has you looking at the world with new eyes.
- [49:22]
Ben Drury
I just finished the Apple in China book.
- [49:24]
Aaron Walter
Oh, right, yeah, yeah.
- [49:26]
Ben Drury
Which was incredible. Super relevant. Toyota, of course. And I really, really enjoyed that book. I mean, I've just been so sucked into AI recently, mostly with Claude. It's been sort of sucking all my brain lately. I feel like it's taking over my brain. But I think, as I mentioned before we started this podcast, I've just started playing guitar again after many years. I used to play in bands, do the whole Camden scene in London, and I've been really enjoying and starting jamming with my kids, so.
- [49:56]
Aaron Walter
Oh, cool.
- [49:57]
Ben Drury
Audio and music is still a big part of my life. And I was very lucky to go and see Radiohead recently, so that was amazing because I've been a big fan of theirs from the early days.
- [50:08]
Aaron Walter
I have seen them four times. They're wonderful. Every single performance. They're really great.
- [50:12]
Ben Drury
One of my best gigs ever was seeing them at Glastonbury supported by Flaming Lips and Flaming Lips. Finished, they played Breathe by Pink Floyd as their last track. And then Radio had come on and I thought I'd died and gone to heaven.
- [50:26]
Aaron Walter
That's a great show you did.
- [50:29]
I gotta ask, what have you been doing with Claude? That's interesting and exciting because I too have been lost in Claude and I'm sending Eli 1 million messages in the middle of the night because I'm just so knee deep in it right now.
- [50:43]
Ben Drury
Yeah, it's been a really big breakthrough for YOTA this year. The thing is getting our own data into Claude. We're using this thing called Mother Duck, which is an interesting name. It hooks into Claude via an mcp and it really allows us to get incredibly deep insights into our customers and understanding what they're listening to and understanding listing patterns in a way that we've never been able to do before. So a lot of rabbit holes have been going down on that. What's amazing, actually, is when you're able to hook up your own data and it's all anonymized and we don't capture any data on children by the way, but getting that data set and then actually being able to cross reference public data sets like say US Census data and you can get deep insights. For example, we realize that YOTA has high penetration on US military basis, Utah has high penetration in certain religious communities, Hasidic Jewish communities in California and Mormons in Utah just to name but two where those communities are very tight knit and they have that kind of anti screen or the anti some kind of screen technology and word of mouth is incredibly strong. So if a product is hit with one family it can spread quite virally. So that's been really interesting for us.
- [51:59]
Aaron Walter
Very cool. Well Ben Drury, thank you so much for being on Design Better. I hope our Design Better listeners will check out yoto. It's a very cool platform, very cool product and anyone who's a parent, they know it's hard to raise kids right now. And so to find products where they can feel connected and engaged and you feel like they're not being taken into negative directions, it's hard to find and very valuable.
- [52:24]
Ben Drury
Thanks for having me. It's been a pleasure to have a great conversation with you.
- [52:27]
Aaron Walter
Go to yotoplay.com to find all the great products and content that YOTO is working on.
- [52:37]
Eli Woolery
This episode was produced by Eli Woolery
- [52:40]
Aaron Walter
and me, Aaron Walter, with engineering and
- [52:43]
Eli Woolery
production support from Brian Paik of Pacific Audio. If you found this episode useful, we hope that you'll leave us a review
- [52:50]
Aaron Walter
on Apple Podcasts, Spotify or wherever you
- [52:53]
Eli Woolery
listen to finer shows.
- [52:55]
Aaron Walter
Or simply drop a link to the show in your team's Slack channel designbetterpodcast.com
- [53:01]
Eli Woolery
It'll really help others discover the show.
- [53:03]
Aaron Walter
Until next time,
- [53:06]
Ben Drury
SA.