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The office of the chief executive at Seven West Media’s South Eveleigh headquarters in Sydney boasts sweeping views across heritage listed locomotive and railway workshops to the Anzac Bridge and Darling Harbour.
In April last year, it played host to a surprise meeting of departing Seven CEO James Warburton with Melbourne billionaire Alex Waislitz and the small-cap investment advisers, Hugh Robertson senior and junior.
“Hugh senior gave me lots of examples of the types of people that he'd worked with before and how they had affected change,” Warburton recalls of being presented with the opportunity to join the board of the listed private social network firm Tinybeans.
“He felt pretty confident that me working with the team and the rest of directors at Tinybeans, we could make it a winner.”
After a couple of additional meetings over lunch with Waislitz - one of Tinybeans’ largest single shareholders - followed by chats with other investors and then the CEO Zsofi Paterson, Warburton agreed to join the board after finishing up at Seven on June 30.
On January 1st this year, he took over as Chair from Chantale Millard.
He says Waislitz highlighted one thing above all else in their discussions: to believe in the product.
“I've always been a believer in that. Often it comes down to the way in which people execute around products, or strategies around products. If the core proposition is right and you can affect the right strategy around it and bring the right change management to it, that is pretty much what I've done my entire career,” Warburton says.
“Seven wasn't a great place in 2019 and we dramatically improved the business and gave it a future. It was the same at APN Outdoor and then at Supercars when I went in under private equity. So I've always been much more attracted to a performance and accountability-based culture and driving measurable change, as opposed to taking roles where it was harder to determine what success looked like.”
Tinybeans is a private social network for families, co-founded by a New York-based Australian entrepreneur Eddie Geller, along with Sarah-Jane Kurtini and Stephen O'Young.
Its users sign up to the platform and upload pictures via a web or smartphone app, and share those pictures privately with friends and family. They can also access a user’s Tinybeans journal, where the photos are collated via email, website or the app.
Since joining Tinybeans as CEO in August 2023, Zsofi Paterson - an avid user of the photo-sharing app for several years - has led a strategic shift to focus on growing the subscription business versus pursuing a publisher based advertising model.
Despite putting through sharp price rises, the firm is getting 91 per cent renewals from paid subscribers. She has also been reducing the headcount in the firm’s core American market and cutting operating expenditure to reduce cash-burn, which helped deliver a 40 per cent increase in EBITDA for the 6 months to December 31.
Continuing to deal with the cost base to reach break-even, while growing subscribers, remains her ongoing priority.
Warburton says his playbook for a successful turnaround in business follows several non-negotiable rules-of-thumb.
“You must simplify everything. Everyone needs to understand the business from the board down. Then you tell them what you are going to do, get on and do it,” he says.
“But staff in troubled organisations get paralysed by fear. It is important to foster relationships with people. I am a walker. I don’t email, text or call people from my office, I get off my arse and walk down the stairs or corridor and see them.”
He says his most important advice to Paterson so far has been to back her gut instincts.
“She is a great young CEO. I have just given her some guidance and confidence in terms of the things that matter, bringing a bit of grey hair around the board table,” he says.
Warburton believes the secret sauce of Tinybeans is its ability to curate the parenting journey for families online in a way that is “really exciting”, in a trusted, protective, private environment.
The security aspect is a big winner in America, where there are about 3.7m births annually, on top of the more than 1.3m in Australia, the UK, Canada and New Zealand.
On average, 1,500 photos are taken in a child’s first year across all these markets.
“Our aspiration is to get to 10 million monthly active users and get to 1 in 4 first time parents. The sweet spot for Tinybeans is for an expecting mum in her last trimester or a very new mum in the early months. That is when they are starting to get organised to share the moments,” he says.
Tinybeans has a strategic relationship with BabyList in America, a digital parenting platform that offers a baby registry, app, ecommerce store, and product guides allowing new parents to make purchases for their babies.
In Australia Tinybeans is promoted in the New Parent Bag Bounty Bag product provided to women, typically within 48 hours of having a baby in hospital.
“We are starting to see a bit of an uptick in subscriptions coming out of those channels,” Warburton says.
The firm has also started talking to photobook operators to expand the physical product offering, the producers of digital photo frames and even the larger public companies in Australia around their Human Resources programs for parents going on maternity leave, offering Tinybeans as a parental leave perk.
For Warburton, Tinybeans is part of a new portfolio of corporate opportunities in his life after Seven, which include investing in revenue generating sales operator Boost Media International and Chairing the board of sport & health technology venture capital investment firm XT Ventures.
“I’m not a person to sit around and do nothing. I am definitely still looking for a full time CEO/MD role. Then, in addition, most boards will allow you to do a couple of other small things,” he says.
Warburton and wife Nikki, formerly an Austar executive and head of marketing at auto group Audi, have two boys from 24 years of marriage. The eldest recently turned 21.
Warburton agrees that being a parent helps him to better appreciate the enormous potential of Tinybeans.
“Because you understand the emotional connection of what it brings,” he says.
“I would love to have all of my photos going back over the 21 years since my older son was born procured into Tinybeans, especially the way it catalogues milestones. I've only got them on hard drives and stuff like that.”
While some might still wonder why he bothered joining the board of a small cap company with a languishing share price that is yet to break even, he sees exciting opportunties for the firm with a new leaner business model, a rejuvenated board and leadership team.
“I've always been in and around different things. So many things stay the same in this world,” he says.
“The great thing about this for me is exercising the curiosity of the mind to do something really, really different. Tinybeans is an amazing.”
About the Company
Tinybeans Group Limited operates a private communication application in the United States and Australia. It operates Tinybeans, an application and web platform, that provides private, secure, and authentic space for capturing and sharing memories, engage with trustworthy content, and find thoughtful recommendations tailored to their family’s needs. The company was founded in 2012 and is based in Sydney, Australia.
Board & Management
Mr James Warburton, Chair & Non-Executive Director
Ms Zsofi Paterson, Managing Director & CEO
Mr Andrew Silverberg, Non-Executive Director
Mr Michael Rothman, Non-Executive Director
Mr Adam Gallagher, Company Secretary
