What’s in the cards for Circa, an award-nabbing industry darling, a pioneer of mobile-first news apps and a visual style that still spreads on the web?
Its atomized cards-and-stacks approach to smartphone news prompted lots of double takes when it product first launched in October 2012. But now 2015 looks to be a pivotal year for the digital toddler’s future. CEO Matt Galligan is assessing his strategic options and is out raising money. Meanwhile, Circa has gained a new across-town competitor — San Francisco-based AJ+, already funded at four times the level of Circa by its parent Al Jazeera.
Galligan seeks $8 million in Series A rounding of funding, following $5.7 million in largely angel startup funding. That may seem like a small amount of cash when we see hundreds of millions (“Why Silicon Valley VCs suddenly love the media”) committed to the BuzzFeeds, Vices, and Vox Medias of the world. While we hear murmurs of a “content bubble,” what’s going on here is more complex. BuzzFeed, Vice, and Vox Media are huge scale plays — built to IPO or, more likely, to sell to Murdoch-class titans, who have figured out they are better off buying the future than developing it themselves. The big ventures will likely pay off well for their investors; those tens of millions in investment enabled huge audience quickly, and smart new revenue thinking is proving out the value of those audiences.
For smaller news startups, it’s not easy pickings out there. Venture people will wax enthusiastic about their big bets, but then acknowledge, sotto voce, that the great majority of their bets are in tech, with only a few in “content.” Why? For the most part, content plays — no matter how good — won’t produce hockey stick returns. If you want to quintuple or better your money, bet on tech.
Matt Galligan is pitching investors on the smart ideas in Circa, particularly in its 3.0 released in October. He might convince investors with the content vision, or perhaps with the tech vision. Circa still prompts two dozen or so publishers to visit or call the company a year, trying to learn from its thinking and sometimes inquiring about licensing its platform.
Today, Circa employs a dozen and a half people. Galligan’s plan calls for 45 within the next year and a half, split mostly between editorial and product. To get there — to build the Circa he envisions — he needs money.
Circa can’t generate that money for itself, at this point. The last two years have been about product building and basic audience growth, and the company doesn’t yet sell advertising or otherwise generate revenue. “2015 is the year of monetization,” Galligan says.
Then, again, monetization is chicken-and-egg. He needs a large enough audience to monetize. Does he have it? That’s debatable; Circa has consistently declined to release overall audience numbers. The company needs to keep building — and for that it needs investment.
New investor money is just one of three routes open to Circa. The other two involve other, bigger publishing companies. Maybe one of the big European or U.S. companies kicking Circa’s tires will buy the company. Or perhaps the company can extend its resources through strategic partnerships that involve greater distribution or sales or other needs a young company possesses.
Or some combination of the three.
Galligan says he’s confident of a way forward. Although none of Galligan’s previous ventures have cashed out big, Circa president John Maloney, who joined the company in April, served as president of Tumblr before Yahoo paid $1.1 billion for it in 2013.
One issue Galligan faces is publisher doubt. While they’ve been attracted by the Circa experience, they’ve cited three concerns in my talks with them. First, they wonder if the Circa treatment of news is really the nirvana of mobile news, the best way to present what’s happening. Second, they wonder how difficult it would be for them to accomplish Circa’s tricks on their own. Third, there’s the question of scale. Can Circa, which processes a few dozens of stories a day, meet the demands of companies that publish thousands in a given week, and own contextual archives well into the six digits?
Galligan has heard all those questions, and says that Circa 3 plus additional workflow improvements coming soon will answer the scale and usability issues for the big guys. How defensible is the Circa difference? The company would bet that its three years of development experience has made it an investable (or buyable) proposition. Others aren’t so sure. They ask how proprietary the tech really is, and note that buying a company like Circa is as much a bet on the acquired team, which, as one exec put it, “is always a crapshoot.”
Many are trying to crack the code of the next new news thing. This year, we’ve seen numerous new mobile-first news rollouts, like, NYT Now, Yahoo News Digest, and Inside.
Cracking that code should offer a huge payoff, as combined smartphone and tablet access regularly reaches 50 percent and beyond for many news companies next year. I visited the topic in the spring (“The newsonomics of three cracks at the mobile news puzzle”), wondering about Circa’s undercooked business model.
That model is now fully warmed, says Galligan. There’s the potential licensing of its platform to publishers, and a host of other ideas — native ads, subscription/memberships, e-commerce — that are both familiar and highly competitive.
As Circa moves forward, one of its key staffers has joined a very Circa-like competitor. David Cohn, well known for his work on crowdfunded-news startup Spot.Us, made the trip from Circa, where he served as chief content officer, less than two miles to the new AJ+ offices in San Francisco in October.
Cohn talks about AJ+ as a logical extension of Circa’s thinking. It doubles down on the cards-and-stacks metaphor, but makes the experience more video-centric. Just launched in September, and now available for both iOS and Android, the product focuses on “what does it mean and how do you feel about it,” he says. Prominently featured at the bottom of stacks: commenting. And, of course, it’s heavily social, with 80 percent of its traffic driven by Facebook, Twitter, and the rest. It’s a profoundly millennials-oriented site, picking up on insistent theme of mobile/social/native/millennial 2014 (“The newsonomics of the Millennials moment”).
AJ+ is ambitious, with Ferguson-related coverage being worked in greater depth, for instance. All together, the AJ+ operation — which reports in to Al Jazeera Strategy, or R&D, and not the broadcast operation itself — now hosts at leasts 80 staffers. 66 fit into the new office across the street from the San Francisco Giants’ ballpark, with the rest overseas, largely in Doha, Al Jazeera’s HQ. Of those 66, 41 do editorial, which that heavy focus on video. That, too, is ambitious, with three separate teams producing original video, from 30 seconds to 12-minutes-plus long documentaries. The parent company doesn’t expect it to help the legacy broadcast side of the business, or even its website, transition to mobile; it’s a standalone mobile operation. 17 staffers make up an engagement team, heavily working social; 8 do the tech.
One of AJ+’s early metrics is an “engagement score” for stories and stacks of stories. Its top-performing story: “How to Stop a Pipeline.” This is the kind of post-modern venture that wants to capture interaction through social sharing, liking, and commenting, says Jigar Mehta, AJ+’s engagement lead — who has wide-ranging experience, including work on the impressive “18 Days in Egypt” and four years working news video at The New York Times.
AJ+ is obviously well funded, and not looking for outside investment.
Cards and stacks
If the intent of serving the reader differently is important, the presentation style is what captures the imagination. Previous generations thought of cards as Bicycle playing cards or Topps baseball tradeables; stacks were what pancakes came in. Now, they’ve become a potent metaphor for reimagining how we consume news, especially on the smartphone, especially given all the attention showed on Ezra Klein’s Vox.com, which has cards handle a part of its storytelling.
The presentation metaphors offered by Circa and AJ+ are immediately attractive, but they may be less well-suited to fuller meals of news. Another way to say that is that the Circa has deconstructed news but it still figuring how to reconstruct it. The stacks kind of work, one topic leading to another, doing a vertical/horizontal balancing act, as a topic like the CIA torture story moves from newest stories to older stories of consequence, and then point to useful links out.
If the now much-maligned inverted pyramid — the foundation of AP-like “new top” writing, ironically thrust on the news industry of the time by an earlier tech upheaval, the arrival of the telegraph — is being replaced here, we might call it a diverted pyramid. (Great history lesson from Chip Scanlan in this Poynter piece.) It’s no accident that Circa touts its “personal wire” service, a semi-personalized new news flow for budding 21st century tech. It’s newest news at the top, and some good contextual diversions below.
Facts, and wee bits of context work, but how will, or can, such sites encompass narrative text storytelling — which will remain a fixture of the future. Says one top news exec: “For me, the atomization of content only makes sense when that little bit is all you want. But Circa’s ambitions have always seemed much greater in the sense that they want to cover big, serious stories that cry out for narrative and depth. In that case, the bite-sized formatting is just an annoying distraction.”
Do you follow?
Cruise through the Circa site, and you’ll frequently be urged to “follow.” Following stories allows readers to stay on top of the topics that most interest them. Galligan makes the point that Circa’s follow has more intelligence under the surface. “Most approaches to following news tend to be glorified Google Alerts. Circa’s differentiation in delivery is distinguishing ‘something happened!’ from ‘here’s what happened.’” It’s the context he’s selling.
As importantly, consider that “follow” acts effectively as light registration. Without signing up with an address, Circa will push notifications to your device. Further, next time you use that device to come back to Circa, it recognizes what you’ve already read and serves you fresh stuff. That’s a useful trick, and another case of the diverted pyramid. AJ+ says its “follow” employs similar ideas, but doesn’t adjust what you see on the site. The Follow metaphor is one we see catching on quite widely, from The Guardian offering its readers the chance to follow its writers to Philadelphia startup Billy Penn making it a feature of the brand new site.
A point to ponder: Like many of these smartphone products, they get smart about your use on single device — but know nothing about your usage on desktops or tablets. Unless you’ve registered, Windows-desktop you is a different you than iPhone you. If many readers are using two or three (or more) devices in the blur of the week, that’s sub-optimal. Circa says a desktop version is coming (and it does have web versions of stories), but for now the focus at both it and AJ+ remains on mobile.
Engagement of the news-interested is the goal here, and it may take veteran newsies some time to wrap their minds around the packages of ideas incorporated. One thing everyone in the news business wants though — and sees as the only salvation for a sustainable business model — is real, sustained engagement with a group of readers.
To that point, Circa’s Matt Galligan believes its Follow feature — and the Circa-built content that it allows readers to get to — should be a winner: “If you ‘follow a story,’ there’s an 80 percent chance you’ll come back in the next seven days.” That number — on a large-scale news site — could make a defining difference.
from Nieman Lab http://ift.tt/1wJrDAy