This Tuesday we held our 5th ArcticEvening event in the cozy premises of Dubrovnik Lounge & Lobby in the heart of Helsinki. The events are slowly becoming the corner stone of the community or the ’social network’ of entrepreneurs we are so eager to bring together across the Nordic and Baltic countries. In effect, they are the offline part of an online community. I believe this is essential for the community to find each other and get to know each other on a more concrete level, so that it will eventually result in more partnerships, more co-operation, more startups, and eventually more success stories. Here’s the spiel I wrote about the event over at ArcticStartup:
ArcticEvening is where everybody at the local startup scene meets each other.
Its aim is to bring everybody together to discuss new ideas, experiences, challenges and developments and above all share knowledge in the Nordic and Baltic startup community.
Come and enjoy a laid-back evening with an entrepreneurial group of people. An event for those interested in startups be you an entrepreneur, technologist, lawyer, angel, VC, accountant, salesman.
The crux is on the first sentence: where everybody at the local startup scene meets each other. Here by local I mean the whole of Nordic and Baltic countries. We have still quite a ways to go but I think we’re well on our way and are already bringing people from Finland to Estonia, people from Sweden to Finland.
ArcticEvening – 3rd March 2009 from CityVice on Vimeo.
Here’s a post on the first OpenCoffee evening that I organized in Helsinki right after I had moved back to Helsinki. Little after I met Antti and Miikka who had already the ArcticStartup blog up and running. This is where it all started and as Bart told to the audience last Tuesday at Dubrovnik: He met his co-founder at Cafe Luft, a small bar in Kallio where the event was held, and now Bart & Co. are well on their way building the next big thing. What goes without much attention, but what I believe is an important part of the event is its context. It’s woven deep into the urban setting and always held in one of the comparatively small bars and cafes of a given city. This has always been the case here in Helsinki, it was the case in Tallinn and it will be the case also in Stockholm when we go there next month. I believe this is imporant.
Having the event in the heart of the city in comparatively small venue gives it a familiar and easy to access context. By not having it in an a bigger arena is central to the culture* we are trying to build: Entrepreneurial mindset, or more concretely ideas on building something new that will change the world for better, should be part of a normal night out with friends at a bar for a given group of people. Entrepeneurs should know where to find the like minded people and where, if you’d eaves drop, you’d constantly here new ideas to build something great. Big ideas, dreams, and road maps to start building on them should be the constant back ground noise in these venues. This is what eventually makes the entrepreneurial culture what it is. Not only that, it will also contribute to building a more lively city.
A healthy city is a lively and buzzing city. I hope and believe ArcticEvenings are a building block, even if just one, building such cities around the Northern Europe by bringing together this lively community**: The urban entrepreneurs. Ideally these people see their city as part of the ecosystem that they can build their organisms on. Here by organisms I mean the businesses that are successful because they add value to the ecosystem and are thus sustainable. This sustainability is also called being profitable. Even if their business is global, the people and the day to day running it, especially in the early days, have a physical location that ideally makes those long working days bearable. I hope this is where ArcticEvenings can come in and find their place: Be the local (Helsinki – Stockholm – Tallinn – and more) network of friends and peers, before the team is strong enough and the venture is mature enough to take on the world.
*By entrepreneurial culture and mindset I don’t mean just building a business in a narrow sense, but creating something new regardless of what you’re passionate about, be it music, food, books or design.
**I want to emphasize that I don’t want everybody starting businesses. Entrepreneurial community should be just one of many groups of like minded people that are constantly active in the city space. It’s the variety that make a lively and great cities.
Revenue models for the media
Media is in crisis. Not because of lack of quality content, but because of lack of models to monetize the quality content. This financial crisis in media, if not reversed, will eventually lead also to lack of quality content when the media houses cut the number of journalists they are able to keep on their pay roll to produce quality investigative journalism.
There are number of reasons for this, but the biggest one is the conquest of Free. Free has became the dominant price point in an increasing number of product categories and it has severe implication in all of them. Free is almost a synonym to digital content, but it also creates havoc in the physical world. Among the hardest hit is the media as we know it.
This development has number of consequences, which not only lead to destruction but also innovation. One of the negative attributes of Free is that it works only to one direction: Once people learn something is free you can almost never start charging for it again. The other night Teemu Arina invited me to join a friendly small group of people to listen Adam Greenfield’s presentation. Adam talked about The elements of networked urbanism, of which he also discusses in his books that is about to come out soon (You can find the table of contents of his book here, and pre-order it here). I enjoyed the talk tremendously and hope more people would get to hear Adam’s insights. During his talk Adam also addressed the problem of Free and how it becomes more pervasive by day: As long as there are free options of a given product or service, people don’t care how much worse they are compared to the paid ones, even if they are next to useless, but revert to the free time and again. Surely there are exceptions to this, but whether we like it or not (and I don’t), this is the trend we are witnessing. A race to the bottom of a kind. You can see some of these dynamics in play with for example iPhone apps.
Now, I believe we will soon start to see radical solutions to address the problem of Free that are not advertising based.
By working at ArcticStartup and trying to figure out how to develop it further, I am thinking about media as a business constantly and here’s where I see the possibilities to broke from the curse of the Free.
ArcticStartup is not my first media startup as I have also co-founded Turnleft Guides, Europe’s first free city guides. Turnleft operates currently in several central-European cities from Amsterdam, Antwerp, Brussels to London and Berlin. It’s a small yet very agile operation. The venture has evolved as time has passed as most startus evolve. Initially we started as a free ad supported magazine called Stirred Up (RIP), closed the business and redirected our resources (mainly our own time) to Turnleft Guides with much of the same team. Now the business is a hybrid of on-demand media publishing and consulting services, namely neighborhood, city and country branding. I don’t talk much of the business as I am not operationally involved anymore, but I still contribute to the strategic direction the venture pursues.
After a year with ArcticStartup I am now thinking the revenue models that could work with ArcticStartup. However, this does not mean that we will pursue any of it, or that it’s the smartest thing to do for this particular media. For us, keeping the structure light and growing slowly has been the best option so far as we really try to further the cause more than anything else. But the point, I believe, is valid. We should start seeing the media as a channel that even though operates in the center of attention, is only facilitating the other services that produces the real cash flow. More importantly, this means that the quality media shouldn’t actually even aim to explicitly bring in the money. The obvious solutions for the model include various market places where you go from real estate search to job listings. But why to stop there? I believe a quality media could drive valuable attention and more importantly lend its credibility to all kinds of services, including consulting from A to Z, research, product sales, training services and events.
Admittedly there are already medias that operate this way, but I believe this could be taken much further to work for the big media. Think New York Times or Financial Times (FT) big.
What if FT would not only provide financial news, but would also tell it’s clients what bits are important for their business and how they should respond to those news to make their businesses succeed. Not only give customized media, but accompany an expert to interpret the news for the client as well. A service contracts where they would advice foreign ministries on their foreign policy media strategies, run training for new officials on how news media will react to different policies, how it resonates with the greater public and how to handle a crisis management communication when a disaster strikes. In a similar manner, I’m sure San Francisco Chronicle (see video below) has tons of latent and build-up knowledge of the city which they could use to build a useful service on, say a consulting arm on urban economics or start a Cafe chain which would aim to be the best place to consume news with a quality cup of coffee. Get a speaker series going, fill the cafes and create a channel to publish and discuss these news online. Or something completely different but equally novel and ingenious.
If that sounds too wild, you can take for example Monocle. A brain child of Mr. Tyler Brûlé who was also responsible for Wallpaper’s success. Monocle’s print product might stay as the brand’s flagship product well into the future (and it should), but increasingly the brand is collecting it’s revenue streams from other sources like The Monocle Shop, which is continuously expanding it’s offering and lately opened it’s first physical store. This is clearly a beneficial symbiosis for everyone involved. Ad to the mix Mr. Brûlé’s design agency, Winkreative, and it starts to seems that the media is supporting the product line and the service arm just as much as the product line and services are supporting the media.
Clearly there are problems to this model, the biggest being the fear or even possibility of loosing the objectivity of the news that a given media produces. But there are ways to design the required checks and balances we need to ensure the quality of the news stories. Making the editorial team fully independent without an obligation to adhere to any financial goals (this includes page views), while at the same time having a well functioning consulting and training arm. This does neither mean journalist should do anything but what they are already doing, namely quality journalism. What it means is that journalists would just have an army of professional consultants/product managers to accompany them as an independent unit under the same umbrella brand. The synergies would come from a brand that has been build over decades, thus the operation would be a mere brand extension. Well designed transparency with the help of an educated public is also surprisingly good at recognizing if a media is leaning too much towards the owners interest. It’s challenging, but at the end of the day it’s really a design problem and there’s a lot of room for innovation. Just like designing visual user experiences for the media channels, the media as a business should also be designed keeping in mind what Eliel Saarinen said: “Always design a thing by considering it in its next larger context – a chair in a room, a room in a house, a house in an environment, an environment in a city plan.” …or a media in a globalized service economy.
This is certainly not for every media, but it could work for some. It’s a painful idea or even unthinkable for some, but change is never easy. This solution, for those that it would work, would not only bring in much needed revenue, but would also free the medias from trying to build yet another walled garden now inside say a device like iphone or Kindle that they could charge for. This would be very short sighted. With service arm to bring in the money, a media could be able to focus to make its content travel and get spread instead of focusing protecting it.
Just as Clay Shirky pointed out “There is no general model for newspapers to replace the one the internet just broke”, but I believe for some a service dimension can be a solution. This is undoubtedly a difficult solution for the most traditional of the media to even consider, but in extraordinatry times we need extraordinatry solutions.