Something curious is happening in the American news business.
Media organizations are hiring again. Promising young reporters are leaving stalwart publications for new newsrooms. And venture capitalists are pouring millions into nimble publishing startups. It’s a rare moment of optimism for an industry accustomed to doom and gloom.
“When we started, investors did not want to invest in anything that involved journalists or reporters or other professional people creating content,” said Jonah Peretti, the chief executive of BuzzFeed, which launched in 2006. “Everyone just said, ‘You can’t get venture capital if you’re hiring people who make content.’”
These days, BuzzFeed is rapidly expanding with $46 million in funding. Vox Media has raked in some $80 million in venture capital. Business Insider’s $12 million boost last week makes its haul about $30 million. And feel-good social curation site Upworthy has raised about $12 million since launching two years ago.
“Suddenly, the market for content just opened up,” said Sarah Lacy, founder of PandoDaily, which has secured about $4 million in venture capital since 2012. “It’s dramatically changed. I think a lot of it for me was Vice getting valued at $1 billion. No one had seen anything like that in the content space. And they’re trying to speak to a very specific audience that’s hard to reach in a deeply authentic way. It’s certainly not something you’re phoning in. It’s not a pre-written press release. It’s not a listicle.”
The shift doesn’t simply reflect a renewed confidence in publishing. It’s also a signal that some online media ventures are finally perceived as being sophisticated and agile tech companies, as well.
“Even now you have people who say if there’s any humans making content then I don’t want to be involved,” said BuzzFeed’s Peretti. “But there are starting to be a lot who say, ‘I see, you have scale and leverage on the internet with social and mobile that will allow you to rebuild great media from the ground up.’ That resonates with people now. Five years ago, no venture capital investors thought media was a great business. They thought it had to be something rich billionaires or philanthropic organizations would fund. That’s the biggest change.”
Source: Excerpt from Quartz