Yoto

What is it?

It all began back in 2015, when new parents, Ben and Filip, reflected on the challenges of modern parenting. They shared concerns over the excessive screen time young children were exposed to, and the knock-on effects on sleep disruption, fine motor control development and screen addiction. With a lack of alternatives giving parents the autonomy to control screen-time, Ben and Filip decided to build a  family-friendly alternative focused fully on audio. 

Why we invested

The founders

Ben is a veteran and pioneer in the online audio space having previously started and exited two large businesses (dotmusic.com; sold to Yahoo.com in 2003 and 7digital: integrated into >100m devices and IPod in 2014). Filip is an API expert who created the 7digital API with Ben. 

The problem

Kids spend 6.3 hours on average on a screen per day, which is three times the healthy level. Parents worry not only because of the hours their children spend on screens but also because of how little oversight and control they have over what their children are exposed to.

The solution

Audio is better than screens at developing children’s brains and nurturing creativity, imagination and speech. Yoto has created a new product category with its safe, connected, screen-free kids audio platform, that parents can feel comfortable leaving their children alone with.

Kids insert and play content from physical cards with inbuilt NFC chips on the Yoto player, choosing from a broad library of stories, music, activities, podcasts, radio and other inspiring and educational audio content. Parents can order, subscribe to, and monitor usage of new content through the Yoto app.

The opportunity

Audio streaming is a maturing industry for adults in developed markets, which could pave the way for a growing market in audio streaming experiences catered to children. The online streaming industry is worth $8.9bn, with gross margins of 25-33%. Parents spend a large amount of money on children’s toys and entertainment, with some reports citing ranges from $6.5k per child (over a lifetime) on toys and up to $3.2k per year on children’s entertainment. Amazon alone generated $4.5bn in revenue from toy sales last year. Yoto’s approach to kids’ audio streaming appeals to the music and entertainment wallet of consumers, while addressing the health and safety concerns that accompany excessive and unmonitored screen time.

The impact

“My son is in total control, no ads, no screens, quality content and educational material. It’s interactive and we’re interacting as a family while he’s using it.”

“I just got our Yoto club January pack and wow! I actually cried when I opened it. My son is about to turn three and registered blind so seeing Braille so prominently in the pack, particularly on the cards, was an amazing thing to see.”

“My little boy, who never used to go to bed without crying, now can’t wait to get in his cot because of this! It has completely revolutionised bedtime!”

Quote from The Founders

“Emerge believed in Yoto right from the start and, as our first cheque in, they invested in us several times before we were ready for growth funding. They supported us throughout the fundraising process, orchestrating our seed round and finding our lead investor (GFC). Their support continued through to Series A, where they brought on board an LP as a significant co-investor.

Through good and tough times, Emerge has been endlessly supportive and quick to respond to any requests. They have built one of the best networks in edtech and a key highlight for us was the moment they brought that network together for an in-person event, at their inaugural Emerge Summit, where we got to meet other founders, investors and operators. You could truly feel the energy and passion for education at the event, as it brought together the community we’re all excited to be a part of.” Ben Drury, co-founder of Yoto