A lot has changed in digital publishing over the past five years. This is true not only with consumption habits, new products, platforms and technologies, but also how business models are restructuring amid industry-wide consolidations.
With scale often being a critical component for building out a thriving digital publishing business, the need for technological upgrades has become table stakes. Digital publishers without streamlined operations or the ability to penetrate scalable markets aren’t nearly as poised for success as those that prioritize tech and optimize efficiency.
Minute Media recognized this trend, and has developed its business strategy accordingly. The global publisher not only owns and operates a growing portfolio with seven titles, some of which utilize user-generated content strategies that undoubtedly increase efficiency and reduce cost, but it has also built out an intuitive tech infrastructure that it leverages for its own brands, as well offering it as a B2B solution for publishing partners. It’s a hybrid business model, and one that is purportedly generating nine-figure revenue.
While a tech/media company isn’t a new concept, we wanted hear more about this particularly unique dichotomous approach, so we connected with president and CRO, Rich Routman, to get an inside perspective on Minute Media’s business model and mission.
Folio: Let’s talk about Minute Media’s emergence. You’ve acquired some notable brands over the past couple years, including the Players’ Tribune, FanSided and Mental Floss. From a big picture perspective, what are your plans for this portfolio buildout and are more acquisitions on the way?
Rich Routman: We have always had the goal of bringing premium brands into our portfolio, building them to scale and using our technology offering and distribution strategy. As we have added these premium brands we have expanded our voice to cover the sports world from both the fan and athlete perspective—connecting the fans to the athletes through authentic and innovative storytelling. A big picture goal is to become the largest digital publisher within the sports and entertainment world.
In terms of more acquisitions, while we originally planned to remain bullish on the M&A front in 2020, due to COVID-19 we are focusing on our current brands and technology offering. But we are always keeping our eyes open for brands that could potentially be a good fit and benefit from our technology, reach and platform.
Folio: You mention COVID-19, which has wreaked havoc on the industry, but couple that with a number of other headwinds our industry already faces, and what do you see as some of the best ways forward for publishers to not only stabilize, but to grow their businesses?
Routman: Publishers really need to focus on tech and infrastructure. So many publishers are spending millions of dollars on licensing fees and operational costs for less than optimal technology, which obviously has a negative impact on the bottom line. With the impact of COVID paired with long-standing industry struggles, it’s time for a shift in business model and ideology for a lot of publishers, because without it, they are not going to survive.
Folio: Let’s first focus on tech in general, which you cite as critical moving forward. To be fair, it has shown that it can also create inefficiencies. So what sort of solutions should publishers specifically be focusing on to avoid this issue?
Routman: We see the main inefficiencies that come with some tech offerings as two fold—clunky tech and high licensing fees. Publishers should focus on finding singular technology that services the needs of multiple departments and functions in order to free up time and resources while increasing efficiencies.
Right now, publishers often work with upwards of 20 different tech providers to service all of their publishing needs, many of which provide a very niche function. This requires publishers to work with 20-plus external tech teams and take on the burden of ensuring these technologies work in unison; not to mention the high costs that come with working with a multitude of vendors.
Paying for a singular technology, especially one that prioritizes growth, can help a publisher’s bottom line. Our experience as a publisher ourselves, led to the creation of Voltax, our proprietary end-to-end technology, which serves as an all-inclusive solution for publishers—OVP, monetization, CMS, etc. By compiling publishing solutions into one offering, we’ve been able to implement the business model of Publishing-as-a-Service not just for our owned and operated brands, but for other publishers as well.
Folio: So what does PaaS actually offer your partners?
Routman: Similar to how Software-as-a-Service (SaaS) helped enterprise companies make software more accessible, the Publishing-as-a-Service model aims to help the media industry keep up with the changing landscape and use technology to respond to new challenges.
The main goal is to increase efficiency, allowing more time and resources to be spent on content creation and innovative initiatives. By offering a tech solution on a rev-share model, versus high licensing fees, we enable publishers to focus on growing their business, and since this technology was built specifically for publishers, they avoid the issues of clunky back-end installations, while being able to stay ahead of the curve and ever changing industry trends.
We are looking to change the digital media landscape by empowering publishers and providing the tools they need to sustain and scale in the future. For instance, our unique “share-as-you-grow” commercial model prioritizes the success of partners—we don’t make money until they do.
From a financial standpoint, the barriers for entry are low, however, we do acknowledge that changing your technology is not something that publishers can or should take lightly. This decision making and internal implementation often require multiple stakeholders to review, align, and ultimately, work in unison.
Folio: You’re obviously a proponent of publishing technologies. How are they shaping and defining your company and its mission?
Routman: We’re both a tech and media company, so we have always felt that tech goes hand in hand with our other initiatives. Having our technology be so ingrained in our business has allowed us to be creative in the other aspects across content and advertising solutions. This includes creating more efficient ways to build revenue, both for ourselves and publishing partners, through audience development and revenue tools. By optimizing our own technology, we’re able to focus on growth without being reliant on third party partners.
Folio: Revenue diversity is increasingly more important for publishers, and as a tech and media company, what are some additional opportunities you see for Minute Media?
Routman: The business is already pursuing various opportunities across Publishing-as-a-Service, D2C, branded content, etc., so for us, the focus is not so much on diversifying into new areas, but rather fine-tuning and growing each one of our current revenue streams to solidify our position of strength in the future.