Twitter, Live Nation and Aruba are investors in $9 million Series A round for Levi’s Stadium app developer VenueNext

Screen shot from VenueNext's Levi's Stadium app

Screen shot from VenueNext’s Levi’s Stadium app

Almost as interesting as today’s news of a $9 million Series A venture round for Levi’s Stadium app developer VenueNext is the list of participants in this round of funding, which includes Twitter Ventures, Live Nation Entertainment and Aruba Networks, among others.

While there’s also an interesting story to be mined about lead investor Causeway Media Partners, whose managing partner Mark Wan is one of the San Francisco 49ers’ “one percent” minority owners, the other listed investors offer an interesting take on VenueNext’s potential future beyond its current single client, Levi’s Stadium.

In a press release announcing the funding, VenueNext CEO John Paul said the funds would be used mainly to expand the VenueNext team to support deployments of venue apps for 30 different new clients before the end of the calendar year. Though VenueNext has yet to name a client other than Levi’s Stadium, its upcoming list is expected to include not just sports stadiums but entertainment venues as well, a facet which partially explains the potential investment interest for Live Nation.

Aruba Networks, now owned by HP, is the gear used in the Wi-Fi and beacon networks at Levi’s, which are integrated tightly with the app, so perhaps the Aruba investment is a small way to gain influence at venues still considering Wi-Fi infrastructure purchases. And while we caution that all this is guesswork at this point, Twitter Ventures’ interest in VenueNext is most likely related to the app’s ability to integrate live video, which at some point could conceivably come from the phones of Twitter users via Vine or Periscope. Like we said, interesting partners to have!

Midseason version of Levi's Stadium app, with clearer icons on main screen

Midseason version of Levi’s Stadium app, with clearer icons on main screen

Much different approach

While VenueNext is still a newcomer in the stadium-application marketplace — trailing far behind established players like YinzCam and MLBAM in numbers of deployed apps — its approach to embracing a small number of fan-focused and revenue-generating features like concessions, ticketing, replays and loyalty programs is much different than most stadium apps, which have historically tried to cram as many features in as possible. VenueNext’s top calling card right now may be the in-seat food and merchandise delivery feature it implemented at Levi’s Stadium last year, impressive mainly because of its advertised ability to reach every seat in the 68,500-seat stadium (which worked pretty well for football games but not so much when hockey crowds showed up).

But what may prove more interesting and useful to other potential clients are VenueNext’s integrated ticketing and marketing-analysis features, which not only make it easier for fans to purchase and redirect tickets, but also allows teams to build databases with rich information about fan purchasing preferences.

On both fronts, VenueNext was successful at Levi’s Stadium last season, with the app accounting for more than $800,000 in food and beverage purchases (according to VenueNext) while also registering more than 200,000 unique users, who are all now a part of the Niners’ marketing database. And while the instant replay feature didn’t get as much fan traction as was originally thought, its backbone systems were impressive in action, and were witnessed last season by a weekly parade of IT guests from interested teams.

Originally conceived and funded by Aurum Partners LLC, an investment entity controlled by the Niners’ owners, VenueNext is part of a sports/technology group of investments by Causeway (including SeatGeek), a boutique-ish firm whose partners have a long history in investment and finance, including being owners of the Boston Celtics. Wan will also join VenueNext’s board as part of the investment round, according to VenueNext.

UPDATE: Wan wrote a post on Medium about the investment.

(VenueNext image parade follows. Credit all Levi’s Stadium photos and app screenshots: Paul Kapustka, MSR. Credit John Paul photo: VenueNext. Enjoy!)

First replay tablet app, which adds info about the play

First replay tablet app, which adds info about the play

Second replay tablet app, which adds a thumbnail to the replay

Second replay tablet app, which adds a thumbnail to the replay

Photo of directions function in Levi's Stadium app.

Photo of directions function in Levi’s Stadium app.

Probably the first time many fans heard the term "NiNerds" (Nov. 23, 2014)

Probably the first time many fans heard the term “NiNerds” (Nov. 23, 2014)

NiNerd sporting the new neon vest.

NiNerd sporting the new neon vest.

John Paul, CEO and founder, VenueNext

John Paul, CEO and founder, VenueNext

Season opener issues: Picture of app late in the first half.

Season opener issues: Picture of app late in the first half.

Niners: Mobile app produced $800K in food orders at Levi’s Stadium

Screen shot from Levi's Stadium app showing active in-seat delivery option.

Screen shot from Levi’s Stadium app showing active in-seat delivery option.

Having a mobile app that allowed for in-seat food and beverage delivery helped produce $802,791 in revenue at Levi’s Stadium last season, according to San Francisco 49ers execs Wednesday.

In a panel presentation at the Veritix Sports Facilities & Franchises/Ticketing Symposium presented by SportsBusiness Journal/Daily in Santa Clara, Niners chief operating officer Al Guido and VenueNext CEO John Paul presented some statistics about Levi’s inaugural season, including the $800 grand number for both in-seat orders and express window pickup orders, which are both facilitiated by the VenueNext-produced Levi’s Stadium app.

According to Guido, the split between the two options was a surprise, with in-seat accounting for 54 percent of the total, against 46 percent for express window pickup. However, he isn’t mad about the outcome, since he said stats showed that fans increased their average spend for delivery orders by two to three dollars per seat by the end of the season.

Though Guido and Paul didn’t mention any concrete new options planned for the upcoming football season, Guido wondered out loud about ideas like dynamic pricing of concessions, such as having half-price hot dogs advertised through the app.

As the data from the inaugural season reveals, in-seat ordering has proven to be a popular choice among fans, leading to increased spending and a more convenient experience. Looking ahead, enhancing the app’s functionality could further boost fan engagement and revenue. One key aspect of this is the push notifications role, which can significantly influence purchasing decisions by delivering timely and relevant offers directly to users’ devices. This approach not only personalizes the service but also encourages higher spending by keeping fans informed about available deals and promotions.

Overall, Paul and Guido said that the Niners had 203,925 unique users of the Levi’s Stadium app last season, including 65 percent of the team’s season ticket holders, who now manage their seats through the app.

Guido also said that if there was one area where the Niners could have done better it was to improve the experience outside the stadium, namely the parking and public transportation services, which experienced numerous problems during the Levi’s Stadium opening season.

“We probably didn’t focus on it enough,” Guido said.

In-seat food delivery returns to Levi’s Stadium for Earthquakes soccer game

Screen shot from Levi's Stadium app showing active in-seat delivery option.

Screen shot from Levi’s Stadium app showing active in-seat delivery option.

In-seat food delivery, the feature perhaps most unique to Levi’s Stadium, will return this Sunday for a MLS game between the San Jose Earthquakes and the Orlando City SC, a 4 p.m. start at the 68,500-seat home of the San Francisco 49ers.

While in-seat food delivery was active for all the Niners’ home games this past NFL season, the feature ran into some issues during the Coors Light Stadium Series hockey game at Levi’s in February, a still not-fully-explained problem of either too many orders or too few staffers to deliver that led to an unspecified number of incompleted orders and angry fans. At subsequent Levi’s events like the March WrestleMania 31 event, fans were not able to order in-seat food and beverage delivery by request of the event’s organizers.

But the latest refresh of the Levi’s Stadium app by VenueNext shows an active in-seat delivery menu, though it appears only food and beverages, and not merchandise, will be available for soccer fans to have brought to their seats. One reason why it may be easier for delivery to be available is that from seating maps it appears that the 300- and 400-level seating areas (the upper decks at Levi’s) won’t be open for the Sunday soccer game, making it a smaller overall crowd.

Levi’s Stadium won’t have in-seat food delivery for Wrestlemania 31

Screen shot of Levi's Stadium app with in-seat delivery option missing in action. Credit: Paul Kapustka, MSR

Screen shot of Levi’s Stadium app with in-seat delivery option missing in action. Credit: Paul Kapustka, MSR

When WWE fans invade Levi’s Stadium on March 29 for Wrestlemania 31, they will have to wrestle their own way to the concession stands for food and drink, because the in-seat food delivery feature of the Levi’s Stadium app won’t be available for that event, according to stadium app officials.

Louise Callagy, vice president of marketing for Levi’s Stadium app developer VenueNext, said Monday that the choice not to have in-seat food and beverage delivery was made by the WWE, and not by Levi’s Stadium officials, or by the San Francisco 49ers, or by VenueNext.

“Levi’s Stadium plays host to many shows and producers, and as part of that, these producers get to decide how they want to use the stadium and the Levi’s Stadium app,” said Callagy in an email reply. “We provide recommendations and they make choices. For Wrestlemania, we understand WWE chose to provide fans the option to order food and drink via Express pick up only, because they did not want to distract guests from the show with in seat deliveries.”

Since we haven’t yet talked to anyone from WWE, it’s unknown if the organization’s decision to “tap out” on in-seat delivery was influenced at all by the snafu that surfaced during the recent Coors Light Stadium Series hockey game at Levi’s Stadium, when a flood of in-seat orders apparently overwhelmed either the app operations or the runner staff, resulting in numerous orders being stalled and/or cancelled without explanation. The Wrestlemania event will be the first big-time professional or college event at Levi’s without the in-seat delivery service available since the Niners’ home opener last Sept. 14. In-seat delivery was available at all Niners’ home games this past season, as well as at two college games and at the hockey game on Feb. 21.

Taking a look at the Levi’s Stadium app on our phone on Monday, with its Wrestlemania 31 cover, the in-seat delivery feature is already gone from the top menu list of app functionality. What is still appearing is the “Express Pickup” feature, where fans at the stadium can use the app to order and pay for food ahead of time and then pick it up at the closest concessions window, theoretically avoiding the long lines that regularly plague all stadiums, including Levi’s.

Is Orlando’s Amway Center the next venue for VenueNext?

Screen shot from VenueNext's Levi's Stadium app

Screen shot from VenueNext’s Levi’s Stadium app

Nobody’s talking officially, but a well-sourced news item today said that the Orlando Magic is seriously kicking the tires on VenueNext’s mobile stadium-app solution, as a possible addition to the in-stadium technology package already in use at the team’s home, the Amway Center.

According to Don Muret’s “Breaking Ground” column in today’s Sports Business Journal (subscription required to view), Orlando Magic CEO Alex Martins said the team is “in talks” with VenueNext to “upgrade mobile technology” at Amway Center for next season. While the report seems more than a little bit unclear on what exactly VenueNext does — it develops and deploys mobile applications, not Wi-Fi gear — the report did say that Magic officials and representatives from the Orlando concessionaire visited VenueNext at Levi’s Stadium for the recent Stadium Series hockey game.

If the report ends up becoming fact, it would represent the first venue outside of Levi’s Stadium to use VenueNext’s stadium-specific mobile application software. VenueNext, which said publicly that it is seeking multiple new customers for its software, hosted a steady parade of prospective customers during the football season at Levi’s Stadium this past fall.

The SBJ report also seems to think that VenueNext technology would somehow replace the existing Wi-Fi infrastructure, which simply doesn’t make any sense. Our guess is that the Orlando team might look to add VenueNext’s ability to do things like instant replays and food ordering, which are fairly unique in the stadium app marketplace.

Jeff Lutes, the Orlando Magic’s vice president of technology, said in an email that “With respect to the article in the SBJ, the Orlando Magic are performing due diligence around the VenueNext mobile application. This does not impact nor replace the AmpThink portal for Wi-Fi registration and on-boarding.” Lutes also said that the stadium’s Cisco-based Wi-Fi network gear would not be affected by any new app. Louise Callagy, VenueNext vice president of marketing, said the company had no comment on the SBJ report.

Hockey crowd melted down Levi’s Stadium network and app, overwhelmed light rail

Levi's Stadium scoreboard during Stadium Series hockey game. Credit all images: Paul Kapustka, MSR (click on any photo for larger image).

Levi’s Stadium scoreboard during Stadium Series hockey game. Credit all images: Paul Kapustka, MSR (click on any photo for larger image).

From a financial and publicity standpoint Saturday’s Coors Light Stadium Series hockey game at Levi’s Stadium was a success, with 70,205 fans packing the football facility to watch the San Jose Sharks lose to the Los Angeles Kings, 2-1. But while the sellout crowd contributed to the general electricity that filled the venue, the mass of people also caused problems with the stadium’s vaunted wireless network, knocking out some parts of the Wi-Fi and cellular networks and overwhelming the unique feature of the stadium app designed to allow fans to have food and drinks delivered to their seats.

Hockey fans also swamped the VTA light rail system, causing some fans to wait as long as two hours before they could catch a bus or train to get home from the stadium. Though light rail officials said they will work on correcting the problems, the commuting jam does not bode well for a facility that is scheduled to host Super Bowl 50 in less than a year’s time, especially since many Super Bowl fans are expected to be traveling from San Francisco to the Santa Clara, Calif., neighborhood where Levi’s Stadium sits.

According to Roger Hacker, senior manager for corporate communications for the San Francisco 49ers, the Levi’s Stadium network team identified “isolated interruptions” of the Wi-Fi network, due to “frequency coordination issues” that the network team had not seen at previous events. Hacker also said that one unnamed wireless carrier had “issues” with its base station firmware, but said that the problems were resolved by game’s end. (For the record, I am a Verizon Wireless customer and I had “issues” getting cellular connectivity Saturday, so draw your own conclusions.)

Since the Niners’ full explanation is somewhat light on facts and numbers, we will first offer a “fan’s view” of the events Saturday night, under the caveat that Mobile Sports Report was not attending the game as press, but instead as just a regular hockey fan (one who purchased two full-price tickets) who was looking forward to using the stadium’s technology to enhance the game experience. Unfortunately for this fan, the Levi’s Stadium network, app and transit services all fell down on the job.

Light show a dud

Though the MSR team had no problems getting to the stadium — our light rail train out of Mountain View at about 5:30 p.m. was relatively empty — I noticed some irregularities in network connections during the pregame ceremonies, when I tried to join in the fan-participation light show, a technology feature recently added to the Levi’s Stadium app especially for the Stadium Series game. Like many people in our area, I couldn’t get the app to work, leaving me staring at a spinning graphic while others in the stadium saw their phones contribute flashing lights during pre-game music.

After the light show segment ended, I noticed that the Levi’s app was performing erratically, quitting on its own and kicking my device off the Wi-Fi network. After rebooting the device (a new Apple iPhone 6 Plus) I still couldn’t connect to the Wi-Fi, an experience I’ve never had at Levi’s. Turning off the Wi-Fi didn’t help, as cellular service also seemed poor. Since I wasn’t really there to work — I just wanted to enjoy the game with my older brother, who was in town for the event — I posted a quick tweet and went back to just watching the Sharks play poorly for the first 20 minutes.

One of the benefits of being a close follower of Levi’s Stadium technology is that when you tweet, people listen. By the middle of the first intermission, I was visited personally by Anoop Nagwani, the new head of the Levi’s Stadium network team, along with a technician from Aruba Networks, the Wi-Fi gear supplier at the stadium. Even with laptops and scanners, my visitors couldn’t immediately discern the network problem; they were, however, visited by a number of other nearby fans, who figured out who they were and relayed their own networking problems to them.

To be clear: I didn’t spend the game as I usually do at Levi’s, wandering around to see how the network is performing at as many spots as I can. But even if the outage was only in our area, that’s a significant problem for Levi’s Stadium, which has touted its technology every chance it gets. I also noticed problems with cellular connectivity all night, which leads me to believe that the network issues were more widespread than just at my seating area.

The official statement from Hacker describing the problems doesn’t pin any specific blame, but a guess from us is that perhaps something in the mix of systems used by the entertainment performers (there was a small stage to one side of the rink where musicians performed) and media new to the facility caused the Wi-Fi problem. Here is the official statement on the Wi-Fi issues:

The Levi’s Stadium network team identified isolated interruptions of the WiFi system in specific sections on Saturday night due to frequency coordination issues previously unseen at the venue and unique to this event. Saturday’s event featured extra radio systems not typical to previous stadium events, some of which were found to be unauthorized by event frequency coordinators. To avoid similar situations in the future, Levi’s Stadium management will be initiating additional frequency control protocols for all events.

Hacker said the network team did not track exactly how widespread the outages were, so could not provide a number of fans affected. But enough apparently did connect, since according to Hacker, the Levi’s network saw near-record traffic Saturday night, with a total of 3.0 terabytes of data carried, second only to the season-opening Niners game back in September, which saw 3.3 TB of data used on the Wi-Fi. Hacker said there were 24,792 unique devices connected to Wi-Fi during Saturday’s event, with a peak concurrent user number of 17,400 users, also second highest behind the season-opener total of 19,0000. The Stadium Series game did set a new mark for throughput with 3.5 Gbps on the network just before the start of the game, a surge that seems to be behind some of the other problems.

Food ordering overwhelmed

During the intermission, my brother and I went out on the 300-level concourse to get something to eat and drink — and encountered one of the untold stories of Levi’s Stadium: the incredibly long and slow lines for concessions. While I haven’t researched this problem in depth, after 10 minutes of inertia in our line I told my brother I would use the app’s food and drink ordering function to get us some vittles and beverages. Finally able to connect via Wi-Fi while on the concourse I placed an order for two beers and two hot dogs, and didn’t worry that the delivery time was 20 minutes. That would put it at the very latest near the end of the second period, which was fine by me since it meant I didn’t have to wait in lines. Or so I thought.

Back in my seat, I was troubled by the fact that even halfway through the period, the app had not switched yet from ordered to “en route.” I also got some error messages I had never seen at Levi’s Stadium before:

When the period ended and there was still no movement from the app (which I only checked sporadically since Wi-Fi never fully connected in my seat), I went back on the concourse where I found a small, angry crowd around the food-runner window at the closest concession stand. Pretty much, everyone there had the same problem I had: We’d ordered food and the app had said that the order had been taken, but nothing had happened since then.

Fans trying to figure out why their food orders weren't delivered

Fans trying to figure out why their food orders weren’t delivered

The situation wasn’t good since nobody at the food-runner window had any technology that would allow them to communicate with the app or network team; they couldn’t even cancel orders or make sure credit card refunds would be processed, which only served to increase the frustration for the fans who were just trying to use the services as advertised.

In the end, the staff at the delivery window did the best they could — which at one point resulted in someone producing slips of paper which the waiting fans used to write down their orders; one staffer then tried to fulfill those orders as best he could, going to the concession stand and bringing them out one by one. After waiting nearly the full intermission (missing Melissa Etheridge) I was given two cold hot dogs and two draft beers. Since there were no food holders left at the stand, I had to put the hot dogs into my jacket pockets and hold both beers. At least I didn’t starve or go thirsty, but it was a far cry from the delivered-to-the-seat functionality I had raved about to my brother that simply didn’t materialize.

During this process I sent an email to Louise Callagy, vice president of marketing at stadium app developer VenueNext. Her in-game response was:

“Levi’s Stadium app usage exceeded any previous event and set new records, causing delivery and order fulfillment delays. As always, we will do a post mortem after the event, and make the necessary adjustments to operational and staffing support, including systems performance analysis. We apologize to any fans who were inconvenienced.”

According to Hacker, the Levi’s Stadium food-runner staffing was at the same level as a regular-season Niners’ game; however, Hacker said the hockey fans broke the previous ordering records before the first period was over. Here is the official statement on the food ordering snafu:

With more than 31,000 new downloads of the Levi’s Stadium App – 20 percent more than had ever been seen at any previous stadium event – the [food ordering] system experienced 50 percent higher order volume in the just first hour of the game than had been seen during any previous event. The dramatic increase led to the extended wait times and cancelled orders experienced by some fans.

In a separate email, Hacker did not provide an exact number for how many fans were represented by the term “some,” but he did confirm that “no customers were charged for unfulfilled orders.”

Still, the system shouldn’t have had any unfulfilled orders, at least not according to the Niners’ consistent hype of the network and the app. Remember, Niners officials had long been confident that their network would be able to stand up to any load. Such was not the case Saturday night.

The long wait home

VTA line following Levi's Stadium hockey game

VTA line following Levi’s Stadium hockey game

After an exciting third period and a game that went down to the final horn, we left the stadium and were immediately greeted by a mass of people packing in to the VTA departure area. With too many people and not enough trains and buses, we spent almost an hour moving like slow cattle until we eventually got on a train to Mountain View. We considered ourselves lucky, since it looked like the folks heading south on VTA were in for an even longer wait.

When we got to the Mountain View station, we waited almost another hour to leave since Caltrain (nicely) kept its last train at the station until two more VTA trains brought the stragglers in from Levi’s. Though VTA has since claimed there were more than twice the “normal” number of riders than it saw at Niners games this season, there was no explanation why VTA didn’t or couldn’t provide more capacity after it saw more fans use the service to get to the game. What was most unpleasant was the overall unorganized method of boarding the trains, just a massive group line with one VTA person on a bullhorn telling everyone to make sure they bought a ticket.

In the end, the time it took to get from the start of the VTA line to my house in San Mateo was three hours — almost as long as the game itself. With some other “special” events like Wrestlemania and concerts coming up at Levi’s and the Super Bowl 50 next year, it’s clear there is lots of work that needs to be done to make it a good experience for all who purchase a ticket, especially those looking to use public transport and the app features to enhance their game-day experience.

Sharks and Kings on the ice at Levi's Stadium

Sharks and Kings on the ice at Levi’s Stadium