“Interesting startups that can solve the problems of a newsroom do exist.” – Aron Pilhofer talks opportunities for startups in news organisations
Startups for News launches its sixth season and as its international jury is selecting the 16 most promising startups that have applied to the 2017 competition, ahead of the online pitch battles starting in March, we sat down with Aron Pilhofer, James B. Steele Chair in Journalism Innovation at Temple University School of Media and Communication in Philadelphia, to discuss his experience and sentiments on the collaboration between newsrooms and startups. Aron Pilhofer will be speaking on a panel at the GEN Summit 2017 in Vienna, 21–23 June.
GEN: During the years you worked at the New York Times and the Guardian, were there startups that impressed you or made you rethink your processes?
Aron Pilhofer: Yes, at the Guardian, about a year ago, we launched a completely new strategy, a business, content and company strategy built around reader revenue, loyalty and membership. We were very open with the fact that among our inspirations was a small startup in the Netherlands called De Correspondent. As the founders were very generous with their time for us, we discovered that their way of approaching the news business was almost the purest expression of a humane kind of journalism that the Guardian also deeply values. So that is one example of a startup that impressed and influenced our thinking. Another one might be Journalism++. What I think separates Journalism++ from other almost similar companies is that they have a very strong ethical core: everything they do, whether it is for an NGO or a news organisation has to comply with the highest journalism standards. I think it is a very interesting model, one that in my opinion could work very effectively in the US.
Although there are a handful of consultancies in the US, MediaStorm for instance, none have the model Journalism++ has, with that extra layer of integrity. I don’t think there is anyone out there that functions quite like that.
How would you go about finding startups that could be interesting for a newsroom?
It is really hard. In fact I would say in the last year before I went to Temple University, when I was acting as Chief Digital Officer at the Guardian, this was the single hardest issue: I could see around me a million and one problems that could be solved internally or through some sort of partnership with a company or a startup. Knowing that I had these problems — a lot of my peers had the same problems — and being aware that there is a company out there that could help solve that problem, did not make finding them any easier. So it is something I want to try and address in my academic role: to try and help organisations on the business side identify those startups, as interesting startups that can solve those problems do exist, they might just not have got on people’s radars yet because they are so small.
There is a company I am working with right now as an informal adviser, called PennyPass. With the success of Blendle there are all kinds of interest in creating micropayment models. Following this path, PennyPass is brilliant: the approach to it is so elegant, it feels right from an usability standpoint, whereas some of the other solutions are kind of clunky. It was founded by two Stanford graduates with a little bit of money, a beautifully executed idea, but also with the same question their peers have: ‘How do we get on anybody’s radar?’ It is a very difficult problem to solve. Helping companies like these is a really useful, worthwhile endeavour.
We conduct a competition called Startups For News for this very reason, trying to bridge the gap between startups and the media. Have you identified people or companies doing this effectively? What can be done to expedite this process?
The venture capital company Matter. is very interesting, they have kicked off a couple of very interesting startups. There is one in particular that I talk about a lot: Hearken, started by a former radio journalist, Jennifer Brandel. At a time when news organisations should be embracing what little audience they have left, they counter-intuitively run in the other direction, which I do not understand. A company like Hearken allows publications to connect with their audience at scale, considering the current climate it is not too hard to think this company should be swimming in revenue. Well, that is not the case. It is extremely hard for them to just get over the threshold and get those meetings. I do not think news executives understand this particular issue.
“Help organisations on the business side identify those startups, as interesting startups that can solve those problems do exist, they might just not have got on people’s radars yet because they are so small.”
With this in mind, there are a few possible entries to the question ‘How do you get them?’ Educating news executives about what matters is crucial. I am not sure that it is actually happening. The organisations that have implemented a paywall should be disciplined and focus on the high-touch, one-to-one interaction that can happen digitally. They are not. Using a tool like Hearken’s that builds user interaction and a two-way communication into the story process in a seamless and elegant way should be obvious enough that they would want to get this company through the door. But they are not. Don’t ask me why.
What to do here is to help these startups make the business case and point news executives, using whatever platform we have to reach them, to say ‘You should look at these guys’. They then need to make some resources available. I wish there were a 100 accelerators like Matters in the world, but finding those journalists who have an idea, want to become an entrepreneur and finding ways to support them is no easy feat. It is a really tricky career shift.
Would you describe yourself as an entrepreneurial journalist? How do you approach this particularity in your career, especially now that you have been appointed chair of Journalism Innovation at Temple University?
I would not say that I am an entrepreneur, but in the very broadest sense, I would say I am an entrepreneurial journalist, yes.
I am actually teaching a class at Temple University called Entrepreneurial Journalism. My students currently have an assignment that involves analysing a mix of advertisement on a number of different sites, including native digital news sites. The idea is to look at a digital organisation, traditional news organisation or a startup and be able to systematically understand what their strategy is, how they are making money – or trying to – who their audience is, what problem they are trying to solve, etc. Essentially the goal is to reverse-engineer the component parts making a business either successful or unsuccessful. And being able to then spot opportunities, find problems that are not being solved and find opportunities that could ultimately lead to a successful outcome.
Whether it means entrepreneurship in the truer sense — starting a company themselves — or whether it is in the context of whatever profession they go into –journalism, marketing, advertising – and have on their minds the framework for innovation. That is what the class is all about. Should journalism schools be teaching this everywhere? Yes.
“I would not say that I am an entrepreneur, but in the very broadest sense, I would say I am an entrepreneurial journalist, yes.”
Would you advise the Temple SMC students to work for a traditional newsroom such as the Washington Post or to venture into working for a startup?
It depends on which startup, it also depends on what the role is at the Washington Post. I don’t think this is an easy question to answer. The Washington Post today, with Jeff Bezos, is probably an environment that is far more open to entrepreneurialism than most traditional newsrooms would be. The Post versus another old legacy newsroom would be a different discussion. It depends.
If you were a leading startup, how would you go about approaching a newsroom?
This is tricky. As a startup with an editorial product, you would have to convince 2 separate sets of bosses: the business boss, who has the money, and the editorial boss. The challenge is you have to make the business case for your product and show how your product is going to help them convert readers into subscribers, but you also have to make the journalistic case for your product and explain why your product is going to allow them to do better journalism. We put this bar artificially high when it should be a lot lower. That is probably why Hearken, like many other, is having a hard time.
Could legacy media and traditional newsrooms benefit from having incubators within their walls?
I can think of a few times when that has happened. At the New York Times, we had one for a couple of years called Time Space, it just faded away. Turner Broadcasting has one as well. The problem is that if you are a startup with limited money and a good product, you have to decide pretty quickly where you have to spend your time and more importantly, where you are going to give your equity. Some workspace in a legacy news organisation isn’t enough. It won’t do much for either the startup or the legacy news organisation. It is tricky. We tried at the New York Times to find startups that had a direct bearing, whose product was perfectly aligned with what we thought was important or problematic. And still it did not work, the overhead was too high.
Data journalism projects and VR productions are niche features with very specific audiences and consequently low appeal for advertisers: their costs are high and the returns on investments seldom. How can media organisations push for innovations with such constraints?
Newsrooms produce 75–80 pieces of content a day, let’s say. Of these 75–80 pieces of content, almost 80% will be read or shared by no one. It will fill a space in the newspaper, somewhere in the middle or the back. Why doesn’t anybody ever ask a question about this? No one ever does. It is just assumed that it is just a sunk cost. I am not saying that we shouldn’t justify investment: elements such as graphics, interactive journalism, VR in particular, are expensive indeed. I am not saying we should throw money at it hapharzadly, in fact I think the Guardian is taking a very mature approach to it with external grants and sponsorships.
Many senior editors-in-chief have told me they would love to do data journalism and produce captivating graphics. When I asked them about the size of their newsroom, they responded ‘Oh, 250 or so’. Well, in this case, that’s a choice. They have the resources, they just choose not to take any away from process, incremental news stories that nobody is reading, nobody is sharing. This, in the end, is making no money for them, because it is not distinctive journalism, it is not as the New York Times calls it ‘journalism you would pay for’ and they are okay with that. I wish I knew why, but I think it comes down to whatever you value. There is an inherent bias toward valuing the thing you have been doing for ever and a day.
About Aron Pilhofer
Aron Pilhofer recently became the James B. Steele Chair in Journalism Innovation at Temple University. In addition to teaching, his work focuses on business models, digital transformation and new forms of storytelling. Pilhofer was previously Executive Editor, Digital, and interim Chief Digital Officer at the Guardian in London. Prior to joining the Guardian, Aron was Associate Managing Editor for Digital Strategy and editor of Interactive News at The New York Times. He was responsible for helping develop and execute the newsroom’s approach to technology, new product, analytics, interactives and social media.
“Modern media organisations such as BuzzFeed, Vox, and Vice are tremendously successful because they operate more like a tech startup than a media organisation.” (TechRepublic, 24 January 2017)
“One of the hurdles was the variability from one news organisation to another. They have different budgets and different times of procurement cycles. It is difficult to make a one size fits all type of solution for every newsroom out there.” (Startups For News, 1st December 2016)
Hampton Stephens—World Politics Review
“We feel very strongly that consequential journalism is worth paying for, and that there is a strong need for more innovation in digital media to give consumers more options for directly supporting quality publishers.” (Venture Beat, 23 March 2016)
Scott McAllister—Time Inc.
“We think it’s an important place for us to test and to learn.” (The Wall Street Journali, 23 March 2016)