At the close of a less-contentious-than-expected panel on indies and Ticketmaster at SXSW, all the parties agreed on one thing: scalping is still a huge problem. Setting aside the ethical questions of jacking ticket prices as high as they’ll go, or the Miley Cyrus scalping debacle of 2007, the biggest problem in such situations for the ticketing industry is that the scalper makes all the money – and the artist, promoter, and venue see none of it.
Zaarly, a soon-to-be-launched mobile sales platform, where the buyer sets the price, provides one possible solution. While the app has uses far beyond music and ticketing (Zaarly will allow users to set a price for almost any service or product, within the law), it could be just what the ticketing industry needs to cut down on scalping, if not completely eradicate it.
If Ticketmaster, Ticketfly, et al were to partner with Zaarly, it could work like this: a last minute buyer (probably at the venue) would set his or her price for a ticket, and then users outside the venue could respond if they were willing to sell the ticket at that price. If the sale is a simple swap (a ticket originally purchased for $50 is sold for $50), then it’s a wash. But if the ticket is sold for more than the original purchase price, they extra revenue would be split between the seller, the artist, the ticketing agency, etc etc. A strong promo push from Zaarly and the ticketing agencies could easily convince fans to use it, and the fact that Zaarly will provide a dispute resolution service and only pay out the seller when both parties are satisfied will provide legitimacy – after all, going through those channels is a lot easier than tracking down the guy who sold you a bum ticket.
The sales data Zaarly would provide would also be of use to ticketing agencies, which have no knowledge of the amounts tickets go for outside the venue. It would also be a useful tool for moving extra ticket inventory and even upselling experiences, such as backstage passes, or seat upgrades.
Zaarly was launched at, and won first prize at, LA Startup Weekend earlier this year. Within a few weeks, it had closed a $1 million in first round funding from Ashton Kutcher, Felicis Ventures, Paul Buchheit, Bill Lee, Naval Ravikant and Lightbank (the venture fund created by Groupon’s founders), among others. Founder Bo Fishback says Zaarly will launch in May, rolling out in seven targeted cities and then quickly spreading from there.