Why We Need Medium to Win

I built and sold a publishing platform with some fine folks. My co-founder is also the co-creator of IA-Writer.

We built the food blogging platform with less than ten folks and scaled it to millions of page views. Our target audience is not Silicon Valley. You’d have likely not heard about us.

I have a somewhat grounded understanding of the publishing landscape, and as many have pointed out, it struck me square why Medium would need these many people in the first place to build a business. During our brainstorming lazy afternoons, we’d joke around Steven Levy’s salary and all that was required to run BackChannel on Medium. Picture this: someone of Mr. Levy’s stature is $250,000 yearly minimum. Then around 7–8 fine folks who get paid nothing less than $100,000. So that’s nearly a million/year in burn for one magazine. Then add Matter, Cuepoint, Warisboring, Re:form, Vantage, Nib, etc.

While as a food blogging platform we tried all scrappy ways to onboard bloggers, Medium force fitted product market fit by solving one side of the market by acquiring aspirational writers, bloggers, and publications with cash. I would jitter looking at these acquisitions. They were easily millions of dollars yearly. It had me convinced that for the large-scale consumer markets you can sometimes choose to forget the CAC, LTV calculation and bet that at volume, economics-of-scale will give you strong-arming capability on the market that very few others can.

“Hey BBDO, we have 15 publishers writing about Mauritius travel with a cumulative traffic of more than 15 million page views. Are you interested…?”

My questions were: how many millions will this take and how large is this market?

I even had bold investor slides copying over the Medium model to allow us to acquire food bloggers, migrate them to our platform for 4–5 million in spend. I was ready to join the bandwagon. It nearly had me convinced.

Our food blogging platform’s core value proposition was that we’d generate revenue much higher than a blogger could do it by themselves. In many cases, we were able to generate 3–10x revenue than what a blogger could do. We did it with ads, affiliates, subscriptions, sponsored content, etc.

But as we went deep into the world of ad revenue, which by far remained the largest revenue stream by magnitudes, I started to realize how murky the world was. There were companies like Adthrive, Medivine, Pubnative, etc. that would manage the ads, fix fill rates, optimize, auction, play with positioning, artificially refreshing the ads on scroll, play on page refresh, preloading ads but delaying page load and a ton of other dirty tactics. Mobile audience suffered the worst. With all of these, some of the bloggers were able to get as high as 15–20 dollars in RPM with 7–8 ad slots and when so much money flowed they didn’t care much about the user experience.

Admittedly we had to do many of these tactics to be delivering anywhere close to the revenue these ad management companies were delivering. We also consoled ourselves to resolving these problems when alternate revenue streams matured.

All these were fundamentally built on the page view model and as such the bloggers were very tuned on manipulating Google and Pinterest search demand.

People even went the distance of splitting up content into multiple pages to decrease bounce rates, increase page views, etc. Google in most of these cases was not intelligent enough and rewarded the these “low bounce rate” pages to go higher up the rank.

My heart would sink whenever I had to take a product decision that went against the user experience. The revenue impact in all these cases was too profound to pass on. Especially since it impacted a blogger’s livelihood. And fundamentally all of these depended on the page view model.

Subscriptions and Patreon models were for the 1% and the mass market still hasn’t ripened to pay for digital content consumption. It largely depends on the audience and not yet a replicable formula. Side note: I wonder how Pando survives.

So whenever we had our tough compromising decisions, we’d always joke —

Let Medium innovate; they’ll activate the market and we’ll follow.

I keenly followed Ev’s and Medium’s public footprint. I even read their funny app store upgrade notes.

Over the years we watched in awe as Medium started to disrupt the page view model to utilizing push notifications, making the app feed the new television, curating good stories, creating a new virality metric around recommend buttons, bringing in new audience, flip-flopping over “medium” to long form, building narratives around beautiful typography and writing, etc.

Having been on both sides of the publishers and audience side, I empathize with the publishers who need to get paid handsomely for their content as much a director would be for a good movie. And for that, we still haven’t figured out a way better than the ad model. If you need users to pay for your content, someone has to create and inculcate a behavioral trait, and that can be done only by someone who has the platform and volume advantage. Medium is our best hope. They have the money, founder perseverance, and vision. My head tells me, the refocus is a ruthless call to conserve cash for a very long time, now that they have gone mainstream.

For all our sake, whatever has happened, they should win.