 "Rasmus Kleis Nielsen")
The Ten Types of People You Meet in a Sale will make you nod in empathy. You may not agree with the 22 Psychological Thrillers From Bollywood but it gets you pottering around ScoopWhoop. You could discover "if India was a bar", a video that takes you through an array of characters who say or do something typical of a state or Union Territory from India.
In a country where everyone has an opinion on what news media should do, ScoopWhoop's is a story of six friends who actually did something. Sattvik Mishra, Sriparna Tikekar, Rishi Pratim Mukherjee, Debarshi Banerjee, Saransh Singh and Suparn Pandey - former batchmates from the Indian Institute of Mass Communication - got together in March 2013 to experiment with ideas on how content could be disseminated online.
In the over two years since it was set up, ScoopWhoop, also called the 'BuzzFeed of India', along with offshoots Vagabomb and Gajab Post (Hindi), has 20 million unique users. "The objective is to get to 30 million in the next six months," says Mishra. In the online media world where top news sites do 30-50 million unique users, those are serious numbers. Without any marketing effort, ScoopWhoop will earn Rs 11 crore in revenue by March 2016 and is managing to now fund day-to-day operations.
Of the Rs 100,000-crore revenue of the media and entertainment sector, digital advertising accounts for Rs 4,350 crore. This, fastest growing part of the business, is where ScoopWhoop operates.
To scale up, late last year ScoopWhoop raised $4 million from Kalaari Capital. This is in addition to two earlier rounds. In September 2014, it had raised $1.5 million from Ignite World (formerly called Bharti Softbank). And, close to when it was set up, Haresh Chawla, partner, India Value Fund Advisors, and Sidharth Rao, founder of WebChutney, were among the first investors in ScoopWhoop, in their personal capacity.
The goal
"ScoopWhoop is a byproduct of an attention deficit economy. It is a news vehicle for 15-25-year olds who are not being served, who need a snappier mix of news and entertainment," says Chawla. ScoopWhoop uses lots of pictures with pithy captions to tell a story, instead of text. It does this through original or curated stories put together in three ways. The newsroom where the editor and staffers figure out the top stories of the day, a software tool that curates what is trending or popular on social media, and by tracking other publications for pieces that might interest its users. The filter through which it looks at any news is whether it has the potential to be shared and is easy to consume. "The team understands the mix of trending stories, text and video, and has done a good job so far," thinks Bala Srinivasa, partner, Kalaari Capital Advisors.
"For scale, they need 40-50 million uniques. The way to do that is continuously have more and more content in different formats. To that end, they are creating more sub-properties, such as for women, food, entertainment and others," says Srinivasa. ScoopWhoop Talkies was set up two months ago and had been making 20-25 videos a month, going up to 100-150 by March. Then, there is long format non-fiction or documentaries that the firm has started work on.
"The company is work-in-progress but the goals are clear. They have got into Hindi, into video. How the mix will evolve depends on consumers. It is scalable because this content is not expensive to produce, it strikes a nerve and has a very valuable target audience. How many brands today are talking to youngsters?" asks Chawla. "The challenge for them is convincing brands to shift spends to digital," says Srinivasa.
A little more than 80 per cent of ScoopWhoop's revenue come from native advertising. Think of it as sponsored posts or advertorials, roughly five per cent of all content. Isn't that intrusive? "Much depends on how we make it. We mention the story is sponsored. If the content is good, users don't mind," thinks Mishra. The site currently charges a flat Rs 1.5 lakh for a sponsored article. This will change as the sales team comes into play.
The worry
His big worry, however, is not costs or revenue. "The DNA of the company is not platform or technology but content. But, simply creating good content is not enough. We want to depend less on Facebook." It brings in 65-70 per cent of ScoopWhoop's total traffic, 25 per cent comes directly and its app brings another six to eight per cent. The dependence on social media is a conundrum that BuzzFeed and others face, too.
Mishra also reckons advertisers need to look differently at metrics. ScoopWhoop gets 98 million digital engagements across platforms - likes, shares, views and so on. That is the story advertisers should look at, instead of only page views and unique users, thinks Mishra.
They might. The fact is media consumption in India is seeing huge changes. "Going forward, we will see the emergence of large digital media publishers," says Srinivasa.
Kalaari and other investors are betting that ScoopWhoop will be one of these.
FACT BOX
Inception: Summer 2013
Area of business: Media and entertainment
Market size: Rs 1,00,000 crore
Fund raising: Rs 60 lakh from Haresh Chawla, partner, India Value Fund Advisors, and Sidharth Rao, founder, WebChutney, in 2013; $1.5 million from Ignite World in September 2014; $4 million from Kalaari Capital in November 2015
Revenue outlook: Rs 11 crore by March 2016
EXPERT TAKE
Rasmus Kleis Nielsen
In 2015, Jonah Peretti, co-founder and chief executive officer, said while the BuzzFeed site drew 200 million monthly users, he was more interested in the 20-billion monthly impressions it generated across Facebook, Twitter, and Instagram. BuzzFeed makes money via native advertising. It is already profitable on revenues of over $100 million and is still investing heavily on expansion. The latest round valued it at $1.5 billion, not far behind the NYTimes Company's $2 billion. Its success raises two questions . One, will its reliance on platforms like Facebook turn out to be a liability like it did for social gaming firm Zynga (Farmville). Two, given that digital media tends to be a winner-takes-all environment, is BuzzFeed a model others can work from? Rasmus Kleis Nielsen, director of research, Reuters Institute for the Study of Journalism |
