Its celebrity users include Martin Scorsese and Charli XCX, and its social media is studded with Hollywood and indie stars delivering their “four favourites”.
But its core appeal is perhaps that you can find like-minded everyday viewers, and tap into their discoveries.
In 2023, Canadian entrepreneur Andrew Wilkinson – a long-time friend of Buchanan – took a 60% stake in Letterboxd via his holding company, Tiny.
Ahead of the deal, Buchanan and von Randow each held a 50% stake.
None of the parties could comment on the terms but the New York Times reported Wilkinson had bought his majority stake at a US$50m valuation, implying a US$15m payday each for Buchanan and von Randow on the shares they sold, with their remaining holdings (20% a piece) valued at US$10m each.
Letterboxd had around 10 million users in 2023 as Wilkinson bought in.
Today, Deadline Hollywood puts the number around 30 million, although there’s no breakdown between free users and those who go ad-free and enjoy other perks from a $21.85 annual pro subscription or a $56.35 per year “patron” sub.
Last December, Letterboxd launched pay-per-view streaming, with its new Video Store offering a selection of indie, cult and international films for rent.
If a sale did go through at US$250m ($423m), then Buchanan and von Randow would each realise US$50m from their respective 20% stakes.
If a Netflix-Letterboxd deal goes ahead, the winner could be Auckland man Duncan Greive – the Spinoff founder who recently launched digital music platform Lume.
Von Randow is one of Lume’s founding investors.
At the time of the 2023 transaction, Letterboxd had 16 staff, with Auckland-based Gemma Gracewood as editor-in-chief, who signed off after more than a decade in March last year.
According to LinkedIn Premium Insights, the company has 124 employees today, including 34 in the US, 21 in India and 19 in New Zealand.
In a 2023 interview, Buchanan told the Herald that he and von Randow had financed Letterboxd themselves since founding the service in 2011.
“There was no outside capital,” he said.
“We took the slow road, bootstrapping by using time from Cactuslab [their web design and development company] to build out the platform.
“And we only hired staff once we broke even. The first fulltime person funded by revenue was in March 2020.”
Third big score
Letterboxd is the pair’s third commercial hit.
Buchanan and von Randow founded Cactus Lab in 2001 as their first venture. Both graduated from the University of Auckland in the mid-1990s with computer science degrees; von Randow joined web design firm WebMedia as his first job while Buchanan became art director of computer magazine Bytes & Bytes and later NetGuide.
Cactuslab was a pioneer in its field. It’s still 100% owned by its founders and numbers Barfoot & Thompson, Ockham Residential, Honda New Zealand, the Jane Goodall Institute, the AA and Westpac among its clients.
“We didn’t realise at the time but, by starting and growing Cactuslab, we were building the engine that would eventually allow us to build Letterboxd,” Buchanan said.
“If you don’t take funding at the start of a big tech project, one of the few other viable options is to supplement it with other paid work. It’s a much slower path, but it allowed us to be much more deliberate in how we designed the features and grew a resilient community.”
Buchanan and von Randow founded their second start-up, Verifi Identity Services, in 2011 with fintech players Tyler McNamee and Vincent McCartney (each of the four had a 25% share).
They created Cloudcheck – an identity verification platform inspired by the user-hostile nature of the Crown-backed RealMe – and gained Sharesies, Milford Asset Management and other high-profile firms as early adopters.
In February last year, UK-listed GBG Group bought Verifi for $20m upfront, plus $8m in earnouts (split between payments this year and next).
Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.