Clutch: Insights into Startup Sustainability – A Student Creator Marketplace

Clutch

​Clutch, a digital marketplace co-founded in 2020 by Madison Long and Simone May, aimed to connect creators with brands seeking marketing and content creation services. Despite early successes, including securing $1.2 million in pre-seed funding and collaborating with over 70 brands, the company faced several challenges that influenced its decision to be acquired by Plaiced in July 2024.

• Founding Year: 2019
• Headquarters: Houston, Texas, United States
• Industry: Professional, Scientific, and Technical Services
• Status: Closed

Business Model

B2B, Two-sided, Service

• Clients: Emerging brands, startups, and companies seeking cost-effective and diverse digital marketing support, particularly those targeting Gen-Z audiences or needing short-form video content.
• Suppliers: Gen-Z creators (and later expanded to all ages) skilled in content creation, social media management, graphic design, and video editing, seeking flexible income opportunities.

It’s Like: Fiverr but for student freelancers, initially focusing on exclusive access within individual schools

• Fiverr connects freelancers with clients seeking various services, primarily focused on digital tasks. Clutch initially targeted the same market but specifically focused on connecting student freelancers with businesses.
• Fiverr allows any freelancer to join its platform. Clutch initially differentiated itself by focusing on individual schools, granting exclusive access to students within a particular institution before expanding to others. This approach aimed to foster a sense of community and leverage the network effects within educational institutions.

Emerging brands struggle to find cost-effective and diverse talent

• Emerging brands struggle to find cost-effective and diverse talent for their digital marketing needs.
• Traditional marketing agencies can be expensive, making it challenging for businesses with limited budgets to access professional services.
• Hiring full-time marketing staff requires significant resources, which may not be feasible for emerging brands.
• Students with digital marketing skills often lack a dedicated platform to showcase their talents and connect with potential clients.

Access to Affordable Talent and Key Advantages

• Access to Affordable Talent: Clutch connected brands with student creators, offering a more budget-friendly alternative to traditional agencies or full-time hires.
• Diverse Skillsets: The platform featured creators with expertise in various digital marketing areas, including content creation, social media management, video production, and graphic design.
• Curated Matching: Clutch employed a personalized approach, connecting brands with creators whose skills and experience aligned with their specific needs and budget.
• Streamlined Collaboration: The platform provided tools for managing projects, from initiation to completion, simplifying the collaboration process for both brands and creators.
• Secure Payments: Clutch facilitated secure and reliable weekly payments for creators, ensuring they were compensated for their work.

Founding Story

• When and How Founded: Clutch, initially known as Campus Concierge, was founded in 2019 by Madison Long (CEO) and Simone May (CTO).
• Problem Experienced: The idea originated from a stadium experience app concept, but the COVID-19 pandemic disrupted live events, leading to a pivot.
• Founders’ Backgrounds:
  • Madison Long: Business and finance background, with experience at Microsoft and the Sheryl Sandberg & Dave Goldberg Family Foundation.
  • Simone May: Computer Science graduate from Purdue University, with experience as a technology consultant at Accenture.
• Why They Started: The pandemic forced them to adapt their initial idea, leading to the college-centric marketplace concept.
• Early Team: Nicole Roman joined as Marketing Director.
• Solution: They created a platform connecting student creators with businesses for digital marketing needs.
• Challenges:
  • Pivoting from the initial app idea due to the pandemic.
  • Seeking new ways to sell their services.
• First Results: Achieved early traction with over 200 student creators and 50 brands during the beta phase.
• Growth:
  • Launched in a closed beta phase, targeting universities in Houston.
  • Rebranded to Clutch and expanded nationally.
  • Raised $1.2 million in pre-seed funding.
• Innovation and Technology: Focused on building a user-friendly platform and emphasized a curated matching process for creators and brands.

Key Growth Milestones

• 2021: Founded as Campus Concierge, focused on connecting student creators with local businesses.
• Late 2021: Rebranded to Clutch and launched a redesigned website, signaling a shift towards a national market.
• August 2022: Announced the national open beta launch of the Clutch platform.
• January 2023: Expanded the platform beyond student creators to include all creators and brands nationwide.

Market & Competition

Target Market

• Emerging Brands: Clutch primarily targeted businesses in their growth phase seeking cost-effective digital marketing solutions. These brands often sought to reach Gen-Z audiences and leverage the expertise of creators in producing short-form video content.
• Creators: Initially, Clutch focused on Gen-Z student creators with skills in content creation, social media management, graphic design, and video editing. Later, the platform expanded to include all creators seeking flexible income opportunities.

Market Size and Growth:

• The global creator economy market was estimated at around $103.8 billion in 2022 and the market was projected to reach $127.65 billion in 2023..
• Some estimates suggest the market could reach $1,487 billion by 2034.
• The number of creators worldwide is estimated to be over 200 million as of 2023.

Potential New Markets:

• Small and Medium-Sized Businesses (SMBs): Clutch’s value proposition of affordable and accessible digital marketing could resonate with SMBs beyond the initial target audience of emerging brands.
• Specific Industry Verticals: Clutch could have explored targeting creators and brands within specific niches, such as fashion, food, or technology, to cater to specialized marketing needs.

Growth Trends:

• The continued growth of the creator economy and the increasing demand for digital marketing services suggest a favorable market environment.
• The rise of short-form video content and platforms like TikTok presents opportunities for creators with relevant skills.
• The increasing focus on diversity and inclusion in marketing could benefit platforms like Clutch that emphasize connecting brands with a diverse pool of creators.

Competitor Landscape

Clutch operated in a competitive landscape of creator marketplaces and influencer marketing platforms.

Key rivals included:

• Pearpop: A marketplace connecting brands with creators for collaborations.
• SwayBrand: A platform facilitating influencer marketing campaigns.
• Huddle: A marketplace for brands to find and collaborate with creators.
• CreatorIQ: An influencer marketing platform offering tools for brands to discover and manage relationships with influencers.
• Curacity: A platform connecting brands with micro-influencers for authentic marketing campaigns.
• Later Influence: An influencer marketing platform with a focus on visual content and Instagram marketing.

Marketing & Sales

Main Positioning Values: Empowering young creators to monetize their skills by connecting them with brands seeking authentic, user-generated content, fostering financial independence and career growth.

Website & Socials

The official website was thatsclutch.com (no longer functional).

Media Coverage

• Houston Inno: Clutch was featured in Houston Inno, a news outlet covering startups and innovation in the Houston area.
• Net Influencer features an interview with Clutch’s co-founders, Madison Long and Simone May, discussing the challenges creators face in achieving consistent income and how Clutch aims to support sustainable careers in the creator economy.
• Clutch made FeedSpot’s best Side Hustle blog list
• Fotis Georgiadis: As a part of their series called “Making Something From Nothing”, Fotis Georgiadis had the pleasure of interviewing Simone May, CTO and Co-Founder of Clutch.

Marketing Strategies

• Direct Outreach: Clutch initially focused on directly reaching out to student creators on university campuses. This strategy aimed to build a strong base of creators, particularly targeting Gen-Z students with skills in content creation, social media management, graphic design, and video editing.
• University Partnerships: Launching initially in a beta phase across three universities in Houston (Texas Southern University, Rice University, and Prairie View A&M) suggests potential partnerships or collaborations with university departments or student organizations to access their networks and reach potential creators.
• Personalized Matching: Clutch emphasized a curated approach, involving a kickoff call with their Customer Success Team to understand brand needs and connect them with suitable creators, highlighting a personalized approach to matching and customer service.
• Content Marketing: Participating in podcasts and potentially maintaining a blog featured on platforms like FeedSpot suggests efforts to engage their target audience through valuable content related to side hustles and the creator economy.
• Public Relations: Clutch actively engaged in PR, issuing press releases, interviews to announce milestones like funding rounds and platform launches, aiming to increase brand awareness and attract both creators and brands.

Product & Innovation

School-centric Approach

Clutch’s initial focus on individual schools before expanding nationally aimed to leverage the trust and network effects within educational institutions. This approach fostered a sense of community and provided a unique selling proposition.

Gen-Z Focus

The platform initially targeted Gen-Z student creators, recognizing their inherent understanding of digital trends and appealing to brands seeking to reach this demographic.

Emphasis on Inclusivity

Clutch highlighted its commitment to democratizing access to opportunities for creators, particularly those from underrepresented backgrounds.

Curated Matching System

Unlike open freelance marketplaces, Clutch employed a more personalized approach, actively matching brands with creators based on specific needs and criteria.

Financials & Metrics

Revenue Sources

• Transaction Fees/Commission: As a two-sided marketplace, Clutch generated revenue by taking a percentage of the payments made by brands to creators for services rendered through the platform.

Metrics

• Funding and Investments: Clutch raised a total of $1.55 million in funding:
• Angel Round: $350,000 in June 2021 from DivInc and friends & family.
• Pre-Seed Round: $1.2 million in August 2022 led by Precursor Ventures, with participation from Capital Factory and HearstLab.
• Employee Count: 2 to 10 employees

Structure & Culture

• Leadership: The company was founded and led by Madison Long (CEO) and Simone May (CTO), indicating a likely flat organizational structure in the early stages.
• Marketing Focus: The early involvement of Nicole Roman as Marketing Director suggests a strong emphasis on marketing and outreach efforts.
• Values: Clutch emphasized values of inclusivity, equity, and empowerment within the creator economy. They aimed to democratize access to information and technology, particularly for underrepresented creators.
• Customer Focus: Clutch prioritized a personalized approach to connecting brands with creators, involving a Customer Success Team to understand specific needs and ensure suitable matches.

Impact & Success

Success Stories

• Creator Earnings: During the closed beta phase, student creators on Clutch collectively earned over $10,000 each month.

Closure Rationale

Clutch grew successfully but faced challenges that led to its acquisition by Plaiced in July 2024. Key factors included leadership changes after co-founder Simone May’s departure, industry shifts driven by AI advancements, and strategic growth considerations.

Exit Factors

1. Intense Market Competition: The creator economy is a rapidly growing yet highly competitive space. Clutch struggled to differentiate itself and capture a significant user base amid numerous established and emerging platforms.​
2. Funding Limitations: While Clutch raised $1.55 million across angel and pre-seed rounds, this capital may have been insufficient to sustain long-term growth, especially considering the costs associated with platform development, marketing, and customer acquisition.​
3. Sales and Marketing Challenges: Early indications suggest that Clutch faced difficulties in its sales and marketing strategies, impacting its ability to attract and retain customers effectively.​
4. Product-Market Fit Issues: Clutch aimed to address the pain point of expensive and time-consuming digital marketing for brands. However, if the platform did not effectively solve this problem or if its pricing structure did not resonate with the target market, it could have led to a lack of sustained adoption.​
5. Leadership Changes: In June 2023, co-founder and CTO Simone May stepped down to focus on her family, leaving Madison Long to lead the company alone during a period of significant industry shifts.

While Clutch achieved profitability, it opted for acquisition to scale operations and integrate AI-driven solutions. The move was not a failure but a strategic decision to enhance creator monetization and brand partnerships under Plaiced’s ecosystem.

Key Takeaways for Entrepreneurs

• Target a Niche, then Dominate: Clutch’s initial focus on individual schools helped establish trust and community, offering a unique advantage in the competitive creator economy.
• Adapt to Industry Shifts: The rise of generative AI reshaped content creation, and businesses must continuously evolve to stay relevant in rapidly changing industries.
• Leadership Stability Matters: Co-founder Simone May’s departure led to restructuring, showing how leadership transitions can impact a startup’s direction and growth trajectory.
• Profitability Alone Isn’t Enough: Despite reaching profitability, Clutch still pursued acquisition, highlighting that long-term scalability and market positioning are just as crucial as revenue.
• Strategic Partnerships Can Be a Smart Exit: Instead of struggling to expand independently, Clutch merged with Plaiced to leverage complementary strengths, demonstrating that smart acquisitions can create better growth opportunities.