Session 2: Aha! Moments

February 09th, 2007 | Category: We Media Miami
By BrianReich

There were numerous references to the ‘elephant in the room’ at the second session of We Media’s on Thursday.  What is the elephant?  Money. Of course. No matter what role you play in the media space – head of a newspaper conglomerate trying to figure out how to integrate citizen media into your operation, individual filmmaker looking to find an outlet for your content, crafty entrepreneur trying to push your ‘big idea’ for syndication to the world, and on and on… everything comes down to money.  If you are starting up, you want to get funded.  If you are independent, you want to get paid for your time.  If you are a public corporation, you have an obligation to your stakeholders to drive profit.  And if you are an investor, you want to make your money back, plus some.

We Media pulled together a pretty accomplished group of innovators and investors – those who have sought funding and those who have provided it – to help the assembled group sort it all out.  I didn’t leave the room with a clear sense of how to get my big idea funded, and I don’t think I am along in that, but there were a bunch of Aha! Moments, including:

  • Consider hybrid models that can drive interest among both audience and advertisers… for example, marrying editorial (‘expert’) leadership with user generated content to produce a higher quality content experience.
  • Different types of user interaction and different cuts of the demographic audience can be much more valuable than others.  Going niche may be your best option.  But does that mean that less valuable audiences should be ignored because they can’t make you money?
  • Can you ask audience/participants to fund their own start-up… create an information co-op if you will?  Who would lead?  A social capitalist instead of a financial one?  Is there a model out there already?  Where?
  • What would an eBay for content look like? News organizations could bid on what content they consider most valuable and the content providers/producers who have the most talent, or who are most effective at selling their content, would rise to the top.
  • Ultimately, we need a system where news organization compete to be the best online, rather than a system that equalizes everyone.  That’s what the original newspaper barons would have wanted.
  • The ad model is broken.  But for smaller organizations and those who are not connected, other funding models are (currently) hard to find or hard to pitch.  There has to be an opportunity to get funding for ideas that haven’t been proven yet or this whole conversation will remain exactly where it is today.
  • If you get the value proposition right, you can bring along corporate sponsors as well as VCs (to share the burden/risk)
  • You have to believe that the audience is going to be able to tell the difference between content that is free and content that is not. There will be real economic cottage industries in content.

And then the panelists offered some closing thoughts and predictions:

  • There is a wide pool of people contributing investment – smaller firms, social pools, angels, hedge funds.  Look at how the investors measure themselves and target your ask to meet that interest.
  • Think about what you are passionate about and what the benefit is – be very sincere about that, be able to communicate that. 
  • The next big thing is going to be mobile (so stop thinking about just the internet world)
  • Old media is going to have to partner with new media.  But, it is tough to partner a horse with an automobile.  Don’t think it will be easy, but find a way.
  • Investors look for things that will forward their business – new networks in newsgathering (that helps augment what people around the world do every day), new platforms for syndication networks, things that add to the collective experience of their individual reporters and editors.  If you are offering something that is not going to meet one of those core strategic objectives, investors are not interested (at least not as an early investor). 
  • Big companies historically muck up small businesses because they think they know, but they don’t.  Keep your focus on growing, driving success, etc. That is not very expensive to do, and there will be many more options for you if you meet those goals.

There is much work still to be done before the major news organizations understand better what needs to be funded, and the smaller, independent producers and providers understand how to find backing.  But new ground was definitely broken in this discussion and if you were listening closely, you might have found the key to finding your next big break.

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