Tinybeans Group Initiates Major Restructure to Cut Costs and Focus on Subscription Growth

Restructure Details

Tinybeans Group Limited has initiated a comprehensive restructure to align its business with a strategy focused on the growth of its paid subscription business. The company aims to cut over US$2 million (A$3 million) in annualized costs, representing approximately 20% of its operating expenses compared to FY24.

As part of this restructure, Tinybeans will transition its product and engineering efforts to Propel Ventures, a prominent product and software development company based in Melbourne, Australia. This transition will be supplemented by high-quality offshore engineers, allowing for more flexible and cost-effective product development while drawing on multi-disciplinary skills.

Strategic Focus

The company's primary focus will be on growing its paid subscription Monthly Recurring Revenue (MRR) to increase enterprise value and long-term shareholder growth. Tinybeans aims to reduce its reliance on advertising revenue, which has been in decline for the past three years, and shift towards a more sustainable operating model with reduced cash burn.

The company will continue to maintain a global growth team, with key members of the Sales, Marketing, Customer Support, and Administration teams remaining in the US. The operational leadership team, including the CEO, will continue to be based in Australia.

CEO's Statement

CEO Zsofi Paterson commented on the restructure, stating, 'In September we undertook a material restructure of the Company to strengthen the Company’s long-term outlook and provide us with more time to execute our strategy. By removing over US$2 million in annualized costs, reducing the size of the team, and partnering with Propel Ventures, we are in a better go-forward position.'

Paterson expressed confidence in the opportunity to grow the market share of Tinybeans' private family photo-sharing app and scale its paid subscriber base. She emphasized the importance of reducing reliance on publisher-led advertising revenue to explore new commercial opportunities based on the company's core asset and first-party data.

Future Outlook

The company remains focused on paid subscriber and Monthly Active User (MAU) growth in key markets such as the US and Australia over FY25. Partnerships will play a crucial role, including channel, B2B, marketing, and product partnerships, with a building pipeline in both regions.

In the upcoming quarter, the focus will be on ensuring a smooth transition of technology and product ownership, cementing a new leadership team, and embedding a new operating rhythm in the business.