This week, a promising startup died: Circa. I was a small investor and a big fan.
There’s a special place in my heart for emerging news brands and curation, and Circa was both.
For background, the company spent $5m building and running a stunning, some say quirky, app powered by a respectable team of news junkies for the past three years.
Compare that to magazine launches in the 90s, which ran $10-20m per year, and you can see how efficient their effort was.
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Sadly, Circa never caught fire. They did have a small, loyal following. Which is really what the first two years of a startup is about: you grab some kindling and light it up. You then hope you can get some embers burning hot. In the case of consumer products, those embers are your early true believers — the superfans.
They had enough of these burning hot embers that I believe they could’ve gotten 3,000 folks to pay $10 a month for it. Not huge money, but enough to keep the brand publishing.
After being shopped for an extended period of time, no one bought the assets, which is puzzling. There is still a possibility this will happen; in a wind-down like this, the board and founders are obligated (sometimes legally, always morally) to sell the assets to recover even a penny on the dollar for investors (which in this case would be ~$50,000).
Last I heard, another dotcom offered $500,000 to pick up the team and platform but the VCs blocked the deal, hoping someone else would pay more. Someone will debate that in the comments, I’m sure.
Why Circa Failed
I’m getting into slightly dangerous waters here, talking about another founder’s company, and one in which I was an investor. However, I don’t think the exceptional founder, MG, in whom I would invest again, would mind.
Circa failed because it was so efficient, so obsessed with the truth, that it was boring.
Circa didn’t produce listicles, it didn’t bend the truth to pull you in with an A/B tested headline (read this for background) and they never went for blood. They were up against Buzzfeed, Huffington Post, and Business Insider, who are crushing it daily using these exact techniques.
Circa’s approach will be familiar to anyone who has been following my email newsletter, my LAUNCH Ticker (which pre-dated Circa by a year or two) or Inside.com (which was built before Circa, but launched after Circa).
Circa would pick out the most important stories of the day and summarize them so a reader could efficiently consume them on a mobile phone.
They did this extraordinarily well, so mission accomplished. However, not enough people noticed, and many of those who did notice elected to be *less* efficient and use other news services which entertained them more.
Circa’s biggest crime was being boring. Bland! Truthful!
You see, most people would rather be entertained by their news than more informed. The masses would rather read an entertaining headline that is inaccurate, but that provides the dopamine rush of clicking it.
It’s sad, but true: news is entertainment — especially to millennials — and if you buck this trend you lose. Of course, you can do both, as many will point out. Buzzfeed is now adding serious reporting to their cat-listicles.
Witness the brilliant Snapchat approach to news: looped videos and fragments of sentences told in a short-attention-span format that would make the founders of MTV’s heads spin!
Vox has done some clever things in between Snapchat short attention and data science, with their “everything you need to know in one chart” approach — which seems to be working well.
My humble little research project LAUNCH Ticker summarizes the most important tech news 2x a day for $10 a month for 1,000 paying subscribers. We almost break even on this product and I personally love that it exists in the world.
However, like Circa, the LAUNCH Ticker is a boutique product. We might be able to break it out if we made it more sensational, but if we did we would lose the core 1,000 who pay us for the product.
So, I’m keeping the LAUNCH Ticker fabulous, factual, and tiny.
Inside.com? Well, I’ve already started going vertical with the product, launching InsideDrones.com and an iOS vertical to go with it. We have 10 more verticals coming out in the next two weeks, and 10 per month until we hit 75 verticals.
We’re writing in a style very similar to Circa, which is to say “just the facts.” That’s probably a mistake, and I’m going to experiment with bringing some more voices to the verticals.
If you want to scale in today’s market, I think you need to have a strong, sexy, and entertaining voice.