BuzzFeed & The Attention Game

BuzzFeed, the company started by Jonah Peretti has received $50 million in funding from Chris Dixon at Andreessen Horowitz, making it one of the largest VC investments in a media company. The news has everyone talking about the deal and everyone has an opinion, including me, which I shared with Bloomberg West’s Emily Chang and her viewers.

The investment values BuzzFeed at $850 million, which seems to be pretty rich for a news organization. It is actually not high if you look at BuzzFeed from the lens of “media company.” Media companies are those companies that have our attention — they can be social networks (Twitter), games (Farmville/Zynga or Candy Crush/ or photo sharing services (Instagram) or a listicles powered flywheel of social attention — BuzzFeed. Like I have said before, they all are basically trying to get us to spend many fractions of our attention on their offerings.

BuzzFeed seems to have a lot of attention from a different generation of viewer/reader/consumer. It has done that through deliberate choice of content, deep understanding of social platforms and a technical stack. Paul Kedrosky calls it “engineered attention.” And this attention, theoretically allows them to expand to different markets. Attention-to-expand into new markets is a strategy that works — as I explained in my Fast Company column. It has worked for cable companies in the past. It has worked for P&G and it has also worked for my much smaller company, Gigaom Inc., which started as a blog and now has expanded into events, subscription offerings and an enterprise research business. It would be fairly easy for BuzzFeed to expand to video, podcasting or whatever next that becomes popular.

It is one of the main reasons why Disney wanted them. BuzzFeed is a media/entertainment company, no different than Disney. Its news operation is as relevant as ABC News is relevant to the larger Disney empire — it gives them a nice cachet and pretensions of being a real news company. It is not — and that is a good thing. And that is what makes it worth so much money that an astute investor like Dixon (trust me, he is!) thinks he can make money. Even a modest IPO helps them win big on this investment — though they don’t expect modest returns on any of their investments. (I might be a premature, but a Yahoo+BuzzFeed merger with Jonah running the show would make a lot of sense sometime in the future.)

The risk for a company like BuzzFeed is that attention is fleeting and viewers are whimsical and fickle. They can move onto something new as quickly as they embraced BuzzFeed. How big of a risk? I don’t know — people still are using Yahoo and people still listen to radio. The other risk is algorithmic. BuzzFeed is very reliant on other platforms for growth and ability to engineer attention. Facebook is known to tinker with its algorithms and destroy businesses in the process.

Google with a few little tweaks were like a gently breeze that knocked down many house of cards including red hot content farm, Demand Media. BuzzFeed is in a lot less risky position — its fortune isn’t tied to just one social platform (though I suspect Facebook is their sugar daddy) and can tap into multiple platforms such as Pinterest and Tumblr.

The big question is how they are going to scale their revenues using native advertising. The risk for native ads is that at scale they can lose potency, much like the more traditional banner ads. As such I have mixed feelings about native advertising, so it would be interesting to see what BuzzFeed does to scale, because it would actually create a template for the traditional news houses. The good news for BuzzFeed — it now has money and thus time to experiment and come up newer & bigger sources of revenue and profit. 

Caffè Sospeso

After spending a long, hot day in Florence, I took a taxi back to the little village deep in the heart of Tuscany. During the long journey, I got into a conversation with our driver, Francesco, who was quite a wise man. A well read Florentine, he was articulate about the history of the region and also about Italy.

Obviously, we talked about local tailors and shoe makers, but we both agreed, that Naples was something else when it came to jackets and shirts. And during our long journey he told me about a concept that totally resonated with me. Francesco, who had spent sometime in Naples, pointed out that in that you can anonymously buy a cup of coffee for someone who can’t afford to pay for one.

This concept of “pending coffee” is called “caffè sospeso.” In Italian it literally means “suspended coffee.” You can read more about it on Wikipedia. I think this concept needs to be imported by coffee loving West Coast cities such as Los Angeles, Portland, and San Francisco.

These cities are host to some of the top coffee establishments in the world and the coffee here is not cheap. While many can afford the $3 espressos or $5 lattes, there are many more who are less fortunate than us. If the coffee establishments were willing, I am happy to help spread the coffee cheer.

While in time I might forget a lot of the details about that hot summer day in Florence, I am less likely to forget Francesco, for during that late night drive through hills of Tuscany, I learned a small but vital lesson — always be looking out for those less fortunate than you.

Recommended Reading: Meanwhile, check out this article about the future of Iced Coffee and how Blue Bottle Coffee plans to scale its artisanal coffee ethos. BBC is backed by True Ventures, so take it with a pinch of salt. However, the writing by The Atlantic deputy editor Alexis Madrigal is lyrical and worth reading.

Photo Credit: All Rights Reserved by Helena Price.

Silicon Valley & Parachute Journalism

A longtime ago, when the only grey in my life was the soot from traffic on my white shirt, I would often read stories in the western media about India, which had a weird sense of deja-vu about them. Take one part of these (all true) topics — exotica, color, poverty, income gap, gender discrimination, dowery and political skullduggery — add a western reporter, a nice fancy hotel room, shake hard. And voila, you would have your article (or series of articles) about India.

The New York Times was the most egregious of the western papers and if you check their archives, you will see what I mean because every new India correspondent pretty much wrote the same set of stories. I would often wonder — how is it that these smart people can’t find interesting stories in a country as messy and fantastical as India. There were more tragedies in that country and there were more uplifting tales — especially as a country tried to grapple its future and its past. (Criticism of their past practices aside, it is also fair to point out the Times has become infinitely better in its coverage of India, China and other places, often doing better work than the local publications as in case of Times’ China corruption coverage.)

In sharp contrast to the Times and others was an old India hand — Mark Tully, who worked for BBC. He was your typical Englishman and was mocked for having gone native. And yet, his stories and reporting had verve and depth, that only comes from knowing the beat. He found tales nobody else did — and if you can find his book No Full Stops in India and read it, then you will know what I mean. He knows modern Indian history better than anyone. William Dalrymple (of The Independent) was another fun foreign correspondent to read and he too had gone native. It was quite a delight to catch up with their work.

When working for Forbes, I pointed out the dichotomy to my then boss, David Churbuck and he quipped: “Classic Parachute Journalism.” According to Wikipedia, “Parachute journalism is the practice of thrusting journalists into an area to report on a story in which the reporter has little knowledge or experience.” This is a term that has typically been used in context of reporters sent to foreign lands to cover hot stories.

Lately, that foreign land seems to be Silicon Valley. 

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Why Customization is the Future

Áslaug Magnúsdóttir, co-founder and CEO of Tinker Tailor writing for The Business of Fashion

Today, I think fashion is moving towards customization. To date, fashion on the Internet has ridden three waves. The first was a promotional wave, where a website was a marketing tool to support a brand or a store. People went online to research products, but largely bought offline in physical stores.

When e-commerce started to pick up, fashion rode the next wave, which was all about product selection and pricing. 

Next, it was about access and curation. Fashion surfed nimbly on this wave. When selection and deals were no longer enough, the opportunity shifted to providing hard to find things — even at full price. It was in this environment that Moda Operandi was born as a members-only, pre-tail site, offering customers early access to covetable runway looks from luxury fashion brands.

But now there is another wave upon us. This wave is about expression and self. It is about empowering people to put their personal stamp on things they care about. It is about helping people create items that cater specifically to who they are. This wave is about customization.

Magnúsdóttir is spot on! As society becomes more homogenized — we as social animals have a desire and desperate need to stand out from the pack, and yet be part of the herd. The boom in the number of tattooed people is a reflection of that  social need to standout and tell your own story. Clothes have always allowed us to standout. But as the world has become more uniform — thanks largely in part to the rise of fast fashion. 

There is an opportunity to capture the shifting zeitgeist. I find newer services such as made-to-measure shirtmaker Trumaker marry the economics and convenience of the Internet with a degree of personalization that is plenty for normal people. I don’t think I am a designer, but I do know what colors, fabrics and collars I like on my shirts and how I want them to fit me. (Hint: not slim)

I ended up ordering a couple of shirts from them on a lark and found the experience so good that I ordered a few more and have even recommended them to my most finicky friends. Though twice the price of Banana Republic or J. Crew or Brooks Brothers, they are many times the quality and a 100 times better when it comes to fit. 

I think it is not just fashion — the growth in the number of startups experimenting with new kinds of food delivery such as my friend Rob and Emily LaFave’s Forage. Mass customization in other industries seems to be on the horizon — and while I don’t think anyone has really figured it out, we are definitely going to see more talk of customization. 

OffScreen & The Great Discontent


Nothing like a brief vacation to remind you that sometimes you just need to turn off the devices, limit your access to the Internet and social webs, breathe and focus. And of course read in the good old analog format — paper.  It is not just books, but also magazines. Despite being an Internet News Guy since 1994, I still am voracious reader of magazines — in their original format. I find the layouts, the typography, the photos and most importantly the serenity of the written word on paper calming and deeply satisfying. (Of course, I go back to the Internet soon after!) 

Instead of trying to buy mainstream magazines, I often opt for more niche and indie publications. Apartmento, Kinfolk, The Fantastic Man are some magazines I often pick up at one of the great news stands in San Francisco — Juicy News. On a recent visit, I picked up issue #7 of the OffScreen magazine which is about “people behind bits and pixel.”

What a fantastic idea — going totally analog about digerati! It is the work of German-born but now Melbourne-based Kai Brach. It is a very small publication, but one I can get behind and if you are in the field of design and creative arts, you should be lending Kai a helping hand and subscribing to the magazine. Yes, it does show that its indie roots and you will find some occasional editorial snafus, but it is full of good stuff. 

In a similar vein, folks from The Great Discontent have turned their interview series with creatives into a print magazine (and it is also available as an iPad magazine.) As a long time reader of the web-based interviews, I think this is a great move as it allows one to take interviews along for reading without interruptions. While many of the interviews appear on the web, they do have a few exclusive interviews. It is pretty amazing considering that Ryan & Tina Essmaker started this in August 2011.


Thank you everyone who follows me on Instagram!

Sitting Still

The hardest thing for me to do is sitting still, so when I have a chance to do so, I do. When planning my first (real & no-work, no-computer) vacation, I promised myself — I will learn to just sit still.

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