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JASON: Hey, everybody. It is Jason Calacanis. Today, on the program, Matt Galligan is with me. He is building a product that I am absolutely addicted to, and that is incredibly relevant to what is going on in the world today. It is called Circa [http://cir.ca/]. Go ahead and download it on your iPhone or iPad. What he is doing is revolutionizing the news process, and how we consume it. It’s thumb-driven. I really think that he is onto something very big, very very big. It is a true innovation in the space of news, where people think we need to innovate, because a lot of things are broken. We are going to learn a lot this hour about starting a company, about a mobile-first company, and about the future of media. Stick with us. It is going to be a great episode.
JASON: Hey, everybody. Hey, everybody. This is “This Week in Startups.” And, boy, I am excited about today’s program, because on the program, I have Matt Galligan, who has made a great product, called Circa. That a lot of intelligent people are buzzing about. I spent twenty years in the media business studying and building editorial based products, and this is one of the few that I have seen on mobile, along with Flipboard and very few others that I think is actually getting it right. We are going to hear all about Circa today, on the program, the design of it, the editorial approach, mobile first, all these important things. If you are an entrepreneur, “This Week in Startups” is where we learn about great products, and building great companies, and trying to put a dent in the universe, taking a lot of risk by being a founder, and making something that, again, changes the world perhaps. Most of the time as founders, we fail, but we try hard, and we try to do innovative stuff. I am really excited to talk about those innovative things. And before we do, let me just take a quick moment to pause for the cause and thank our partners. We will be right back.
JASON’S AD: Hey, everybody. What a great interview we are having here, talking about Circa, and the future of news. This show is brought to you by New Relic. They are a great new service that I have been using for a little while now. She is saying, “It’s a new service.” It is a service that a lot of us in the industry have been using to monitor how our software, and how our services are doing. It does it for me in real-time. I get these email reports, which are great, because I actually do not need to see in real-time myself. My people see it in real-time. I need to see a weekly report or a daily report, just to know that Launch.co is up and running well, Thisweekin.com is running well, Mahalo.com is running well. I need to know Inside.com, when it launches in September, is running well. Take a look at this report here. This is the real-time experience here. You could look at the code level, and the server level, the performance of your app, so you can find that, “Oh, it’s dipping, it’s slower.” Why? Is that the page rendering, how the page renders in your browser? Is that the web application, the software you are using? Is that the network between your web application and the consumer on the page rendering side? You could see the average server response time here, under a hundred milliseconds. That is great. The browser page load time is three seconds. That is not so good, and it seems to have gotten slower, and we have to figure out why that is. Is it because of the cross queuing? Is that the network? Something happened here around 11:20, and then we can go look into that and figure out. It is still within range of 2.9 seconds, but the browser load time, as you see here, is completely low on the browser side, which is OK to be three seconds, because there are a lot of images, this is a long page. Then, of course, I can see what is going on here. And one of the things where the specific pieces of the app that are taking time to load, and the server resources, of course. What is going on with the physical memory or the CPU? Obviously, the CPU on a lot of these web apps is very low. And the memory is critically important. The disk utilization can be a major thing. Here is your input/output. How your NIC-card, your Network Interface Card is doing? What you are running Ubuntu and how much RAM you got on the server? All this great stuff that you need to know, that you are running Ruby [on Rails] on Nginx. We use it as I said here on all our stuff. They got forty thousand customers right now, including Skullcandy, Spotify, Nike, Zillow, and Vonage. All these great companies and developers across the spectrum trust their critical performance of their apps to New Relic. I bet you Circa uses it too. So if you want super paired visibility to all your mobile apps, sign up today, and you will get a free “This Week in Startups” shirt. That is right, you got a TWiST shirt. Go to NewRelic.com/TWIST. OK. So just, go to NewRelic.com/TWIST. It is super fast, super easy and no credit card is required. It is a great product. Everybody is using it. I give them my highest recommendation. Again, we only talk about products here. We have a six-month waiting list to advertise on “This Week in Startups,” because I am doing it twice a week. I am not doing any more than that, I am telling you right now. Two interviews for me are great. When we got to three to four interviews a week, I am just exhausted. Two is the perfect number. We are going to do a hundred episodes a year. Six months of ads sold out at a time, it is fantastic, and it is because the show is so great, the audience is so great, and the partners are so great. So when you hear this ad for New Relic, it is as if you are hearing me giving you candid advice on what you should use to make your startup to run better. I will not shill, I will not tell you to use a product if it is not absolutely awesome. New Relic is absolutely awesome. Let us get back to this great interview. Matt is a fascinating guy and Circa is one of those news products that I am obsessed with, it is a great product. It is a great interview. Let us keep going.
JASON: Hey, everybody. We are back. Thanks to our partners for making this happen. Matt Galligan of Circa is with us today. You can follow him on Twitter @mg. You can download his app, which is in the App Store. It is called Circa. Matt, welcome to the program.
MATT: Thanks for having me.
JASON: You and I have talked about the product on Twitter. You have been doing the Internet thing for a little while now. You did SimpleGeo, sold it to Airship. Was that right?
MATT: Urban Airship.
JASON: Urban Airship bought it, and SimpleGeo was what? What was SimpleGeo for the audience who does not know? He is like, “But you know what SimpleGeo is, Jay!” I always have to tell people this at the beginning. I have to tell you two things. One, I am going to ask questions that I know the answer to, do not be thrown off by that as you just were. And number two, authenticity and honesty are the currency of the room. So the people know, who watch the program, those are two things that I tell people before the show begins, but I forgot this time. So number one, I am going to ask stupid questions sometimes, but for the benefit of the audience. And two, be honest in all things. OK. So tell us about SimpleGeo. What was SimpleGeo? What was the point of that?
MATT: SimpleGeo was a developer infrastructure that made it easier for developers working on iPhone apps or other things to actually integrate location, and so it went well above and beyond things like Google maps, and made it easy to integrate contextual relevance to location, places, many different things, but back-end ecosystem type stuff.
JASON: You wind up getting it sold, and then you started Circa. I believe that was the order in which you did things.
MATT: Yeah. I took a little bit of time off to kind of explore. I had a number of ideas that I was thinking through and working on, and ultimately abandoned them, because they felt like they were just too contrived.
JASON: What were those contrived ideas? That is always good, because this is a great thing for entrepreneurs to know which babies to kill? What did you kill and why?
MATT: Yes. I had a couple of ideas. The one that I probably spent the most time on, was actually a photo app, that was going to take all the photos on all of your different networks, and put them into one place, and made them easy to consume, and flip through, and kind of rediscover. Now, it is kind of good, because now, I am seeing all of these come out. Cluster [getcluster.com] is being one of them. Actually, my friend Brandon did. But it seems it is going to be really crowded space very quickly, and I also could not seem to find exactly what was going to make it a massive business. Having started two companies previously, I want to find an idea that I felt that I could build into a big long-term lasting company.
JASON: I guess after doing SimpleGeo, finding that product market fit and product founder fit was at the top of your mind.
MATT: Absolutely. I mean, I am a consumer guy, and SimpleGeo was not a consumer product. So I felt like I needed to get back into the game with consumer products.
JASON: So tell us what is Circa? How do you explain it? And we will play some video over your description of the actual product.
MATT: Sure. Circa is a mobile native news app, well, company in general, but our first iteration is actually an iPhone app. The idea behind it is, you have a handful of minutes here and there to be able to catch up on things. It is this gap time that exists throughout the day. We do not consume news quite the same way that we used to, where it would be forty minutes sitting down with a paper and a cup of coffee. Now, it is a situation when you are waiting in line for coffee, you have five minutes, how do you keep up with everything and not read incredibly lengthy articles, which is the way that most things get produced today? It was first about creating a high-quality user experience and making it easy to consume, but then it was about the content itself. How do you make content mobile? What we do is we have an editorial team that takes big stories, the big breaking stories of the day, breaks them down into core facts, stats, photos, things like that, what we call the atomic elements of news, and then presents them in a nice format. So that makes it, so you can keep up really quickly, catch-up very fast to any of the stories of the day. Then, the key feature that we have is the idea that you can follow news. So, rather than writing an article day-in and day-out, we are actually taking stories, letting them evolve over time, adding to them, building on them over time. Then as a user, I can follow them and get push notifications.
JASON: So, which story has been the most successful in terms of engagement and in terms of you tracking it? I am asking this toward the end of April in 2013, for people who do not know.
MATT: Yeah. So the biggest story by far for us has been unfortunate Boston events of last week. It was without doubt a crazy story that had many different evolutions and over the course of a week. It all happened in a very concentrated time period and so, for us, what we consider to be a solid engagement is when we get followers around a story, and then whenever updates to that story happens and a subsequent push notification, what does the activity look like after that? It was just crazy to see how much people were coming back, and back, and back to the story. I know one of the stats that blew my mind was between Monday and Friday of last week we had more than a handful of users opening the app a hundred times or more.
JASON: Wow. In a five-day period, which is twenty times a day on average.
MATT: In five days. Yeah.
JASON: What does that speak to in terms of consumption of news and how that changes on mobile? Or how is it changed in general?
MATT: You know that bit is a bit extreme, obviously, but I think that, you know, any app that can constantly re-engage a user is going to be really important, because you have all of these apps on your phones, which one do you pick to go into? Having this “follow” feature means that we can stay in tight with the user and keep them coming back.
JASON: Yeah. So in that news case we heard a lot of criticism of media this week that media is broken. That media did a bad job. Social media, communities like Reddit or 4Chan, even CNN people were blaming for doing that. It seemed like it was an equal condemnation of the entire media space from social to message boards, to television, to newspapers. Do you agree that media is broken, and they did a bad job? Or do you think they did a tremendously good job?
MATT: I think that there is a spectrum. I think that there was good and bad. I think it was an incredibly complex and difficult event to cover. You have many different details coming out at many different times. We are also in this bizarre period with media, where media in general, CNN as an example, is struggling to figure out, “How do we work with Twitter?” Do we still try to be faster than Twitter in getting some of these details out? So I will mention it in the second, but you know there was a lot of misinformation. There was a lot of just straight-up bad reporting, but I think that things worked pretty well, all things considered.
JASON: Yeah. Intelligent people seem to think that the process, although, may be different from how we previously consumed this stuff, which would be like the day after or, maybe, we watch CNN Live. The process might be faster, or more spontaneous, or a little more dispersed, but overall people felt more informed, I think.
MATT: I think so. I think the challenge is that you cannot just believe everything coming through on a Twitter stream. It is happening in such real time that you cannot believe. You have to step back and realize, there is so much going on. Use Twitter as a tool, not as the end.
JASON: Almost like “Be your own journalist.” Because you see the sources in real-time in some cases.
MATT: Well, in some cases the sources came from Reddit or things like that. It gets a little bit…
JASON: Or it could be trolls just putting out false information, it could be people with agendas.
MATT: Absolutely. I think Reddit was interesting this week seeing how you had people jumping on this like almost citizen investigation type stuff. That is inevitable, and that is going to keep happening. I think it is how we react to that, that is going to be important. Almost like, when an investigation is ongoing, it should be behind closed doors, because you never know what kind of crazy misinformation might get out there and how it might truly affect the actual investigation.
JASON: But some argue there is no way for it to occur behind doors because the evidence and the people are occurring in real-time, in the example of the Michael Arrington and Jenn Allen scandal, back and forth, you had one person claiming she was raped and beaten by one individual, and the other person saying they were not on Twitter. It was back and forth, and back and forth. They were acting this out, and it still does not have a resolution. They were acting this out in real-time before the news even covered.
MATT: In the public.
JASON: In the public! So it cannot go back behind closed doors, it seems.
MATT: I think it is maybe then how it is reacted to by these news organizations after the fact.
JASON: How should they react? Is there the best practice emerging? How are you doing it?
MATT: You know, I will spend a second on how we did it, but knock on wood for the future, but I can tell you that without a doubt for the week of the coverage of Boston, Circa never ran a single inaccuracy at all.
JASON: Wow. How did you manage that, because you were questioning?
MATT: We questioned everything. First off, we do not run a single thing as a confirmed report, unless we have actually got multiple sources confirming the exact same thing. Then, there are some things that get a little suspect, like, when some names started to get thrown out about a potential suspect for the Boston marathon bombing. You know, we were very questioning as to whether or not it was true, we did not run it. And you know, if I look back at the chat logs on our news team has distributed, if I look back, there are a lot of arguments back and forth as to whether or not one detail gets run versus another, but we have a responsibility to tell the truth. And we know that Twitter is always going to be faster than we are, because we accept that, and we can slow down a little bit, and do our best to get the actual truth out there.
JASON: So speed is important, but not the be-all and end-all for Circa.
MATT: Yeah. Absolutely. I think that is a responsibility that any news organization should have now. It should be the ones that are confirming the reports and doing investigations on the reports, not just standing on the air reading tweets that they happen to be seen flying by. I think that is doing a disservice to the people that are watching the news.
JASON: In this case, we had Reddit debating who could potentially have done the bombing based upon a photographic evidence. They did a remarkably good job at finding the people, and also finding people who happen to be carrying backpacks that were sagging that were innocent. How did you cover that?
MATT: That is an incredibly difficult situation. First off, we might cover the fact that it’s happening, and we might cover the kinds of things that people are doing to discover how this is working, but we are not going to cover the people mentioned, and we are not going to cover the data that they throw back and forth until it actually is something.
JASON: Why is that? Is there a benchmark when you would? So, let us say in this specific example, “OK. Two people with backpacks are seen at three different locations, and there is a photographic evidence, and there are multiple different angles, because that is sort of what started to happen.” Is there a point, in which you say, “Reddit believes it’s closing in,” but do not show the photos, or do not mention the people? Or do you say, “Hey, Reddit feels like they are reaching consensus, and Reddit believes, these are the people,” and huge disclaimer here?
MATT: I think if we can be forthcoming about what details are known, and you know, if it’s something that will get resolved, I think that we can stand out in front of it and help debunk different things. Like, there is one blog post, we threw out recently, when misinformation gets out there, it is not just about not repeating that misinformation, but also identifying that misinformation for your readers, and saying, “Hey. This was wrong,” because even if they got it from their news outlet, as a news organization, we may still have a responsibility to readers to debunk things that were reported inaccurately elsewhere.
JASON: So this advocacy for the truth, advocacy for clarity for the user becomes the guiding principle.
MATT: Absolutely. You cannot just rely on the fact that somebody is only reading you anymore. If it was a newspaper, you had that one newspaper, and that was your one source of truth. We have many sources of truth now. We cannot just trust the one source that we are seeing. As a news organization, we can get out there in front of some of these problems and debunk things. I think that leads to a greater responsibility to our readers.
JASON: The design of the product is gorgeous, you have heard that before.
MATT: Thank you.
JASON: How important are the design and structure of the news to the experience today?
MATT: Well, design around news has always been important. If you think about newspapers, I mean, newspapers were the pinnacle of typography, and layout design, and all of these things. It is like, “How do you get somebody compelled to read columns of text?” So when we decided that we wanted to do Circa and the various ways that we might to communicate news, we knew that design is going to be of utmost importance. So I actually reached out to the person that designed my first company’s social thing. He was seventeen at the time, when he was working on the social thing with me. We picked him up to work with me to do Circa’s design. It has been really interesting, because neither of us came from a background nor ever doing print design or newspaper.
JASON: You can give him a shot up. I do not mind.
MATT: Yeah. Tim Shundo is a phenomenal designer. But I think that going forward, there are a lot of things that need to be tried and experimented with, because a lot of how we have presented news so far, is great, but I think that a lot of opportunities to change and adapt, and do something different from what we have done in the past.
JASON: I notice the chunking of the news, which is great. I have really liked that feature, where you can flip and get the next chunk, the next chunk. Obviously, you can follow a topic. So if a new chunk, I just call them “chunks,” so if a new chunk comes in, you called them, I think, “facts” before…
JASON: Points! Yeah. So points, chunks. So a new point comes up, I get an alert. OK, because I was following the SpaceX or the Dragon capsule, so it was great, I can see the update. This chunking that occurs, I notice that there are not social media and discussion around the chunk. I was just thinking, I would like to comment on a chunk. Is that something that would then be problematic for what you are doing or would it be creative with what you are doing?
MATT: I think it is something we want to add. It is something where news or comments around news have historically been bad.
MATT: Like, the content itself is bad, it is all about an ego game, it tends to get devolved, and things like that. So first off, we want to do it, we just have to find the right approach. I think we found a really interesting way to think about these things. I think that people want a platform to talk about news, but I think that they want to do so in a way where it is actually additive to the experience and not subtractive. The way that we think about commenting and things like that around our content, is that our content is factual. It is snappy. It is to the point. We do not add an opinion. We do not add bias. This is an opportunity for our users to bring up opinion and then, for us, to be able to surface those opinions. We are good at where we are good at. Then, we allow our readers to flesh out the opinion a little bit further.
JASON: So if we are on a controversial topic, let us say gun control, which I was following, and you did a solid job as well. You do not have to take a position on our background checks are reasonable or not, you can state who’s opposed to it, what a background check is, how it’s defined, where the vote wound up, and let other people just fire away in the comments. It just gives you a little bit clarity of mission there.
MATT: That is the idea.
JASON: All right. When we get back from a commercial break, the sponsor break, the partner break, I want to talk about how you are going to make money, speaking of partners and pauses for the cause. So let us just take a quick break here for our partner’s message.
JASON’S AD: We want to take a moment from this great interview to talk about ShareFile by Citrix. It is designed for business. With ShareFile you can send files of almost any size securely. We use it here at ThisWeekIn, Launch and Inside.com to request files to get e-mail alerts when someone is uploading or downloading these files, and to share large video clips. You can see here how granular and feature rich, and the surf rich [is the product]. You can see the top files that we are sharing. You can take a look at the uploads and the downloads, and people are editing and moving stuff around. You can do all this auditing of the activity log based on date. So you can say, “Hey, show me what is going on in the last week, the last month, et cetera.” Here is how use it. Like, we get people to send their ads in, like here is the Sourcebits spot, and I can see who in our team has access to it. You can control that access on a pretty granular level, and it works really well. So visit ShareFile.com, click on the radio microphone button, and use the promo code TWIST. That is right. Go to ShareFile.com, ShareFile.com, click on the radio microphone button, and use the promo code TWIST, no credit card required. Thirty-day free trial. You know what, we started a TWIST club, where you can gain access to a special video file. Yes, that is right. We drop it right in your ShareFile [account]. It is the top ten questions, which I have ever been asked and answered on the three hundred fifty episodes or so of “This Week in Startups.” These are the ten best questions, and Kirin and the team put a lot of work into this. So step one, you signed up for ShareFile, and used the promo code TWIST, T_W_I_S_T. Step two, you just send us “Request a File link” to ShareFile@launch.co. So you say, “Request a File link” to ShareFile@launch.co. It is easy, and this file is only available by those requesting it through ShareFile. So it is a little special treat, we have for you. Thanks to our friends at ShareFile. Everybody, say, “Thank you, @sharefile by @citrix” on their Twitter account. Thanks ShareFile for putting together a great product that you are going to really love and for making independent media like “This Week in Startups” possible. Let us get back to our interview with Matt from Circa.
JASON: Welcome back, everybody. Thank you to my partner for one of my great partners, it was either ShareFile or New Relic, both of which products we use here, we love. A large part of what is wrong with media today seems to be the revenue model. We saw newspapers lose subscriptions to print, we saw them lose classified ads to Craigslist, and what has left? Advertising. They are trying to reintroduce the subscription online to varying degrees of success, but obviously, the cost structure of large enterprises has just actually collapsed on itself. We are seeing every local newspaper is downsized if not shut down. You, guys, are going to need to make money at some point. You have raised an angel round in January, 2013, you did $750k, and $900k back in April. You are right now doing angel-investing thing, but at some point, something is going to have to pay the bills. Besides from investors, what that would be?
MATT: I have a few different things that we are thinking through, and a few different things, which we are actually implementing or in the process of implementing. I think the way that we think about news monetization is that, first off, news had the same monetization tools for literally a hundred years, and all of a sudden, one day, they are gone. It was like off a cliff. Advertising being one of those things, in the way, that it is done on the web is just these banner ads and things like that. I mean as a user, I become blind to it.
JASON: Yeah. They are completely ineffective.
MATT: It is not an additive experience. When I think back to when advertising was high quality and something that people actually cared about. You know, you look at, and I use Mad Men as the example, you look at the Mad Men era where information was actually conveyed through advertising, because we did not have the Internet. I could not go on and search for what camera I should be buying, it was the ads that were telling me, which goods I should be buying. So the ads were something that was a medium to tell people, what I should purchase. That was an additive experience. Today it is not at all. So, the way that I think about advertising is actually on the lines, for instance, of what BuzzFeed is doing with sponsored content with native advertising. I think that there are ways where user saying, “This is sponsored content, but still have something of value to somebody.” Those are some things that we are thinking through with Circa: being able to do sponsored content, being able to sponsor categories, being able to still convey truthful news, but being able to do so in a way where we have obviously partners in money coming in, to be able to develop that content. That is the first bit of what we are thinking through.
JASON: And native advertising, for the audience that may have just heard that term for the first time, it is a relatively new term, under a year for people using that term. How do you define native advertising?
MATT: I define native advertising as being able to tell a message, whether or not it is paid for by the sponsor, and the story itself was paid for by the sponsor, or you pair a story with a sponsor, because it happens to be relevant between the two. BuzzFeed has done a great job of this. The way that they are doing it is you take your voice, you take your style, you take your design, you take everything that is internal, that people like about your particular company, and then you develop an ad product around it. I think one of the best examples that I have seen is Uncrate, which is a blog for stuff for guys. It is like cars, and gadgets, and fashion, and things like that, but they did an amazing job with this, where every week or so, they do a post, called Garb. It is an outfit. It is just an outfit that you might find. Here is a shirt, here are some pants, and here are some sunglasses. Every once in a while, it would be sponsored. So J. Crew will come in and say, “Here is Garb by J. Crew,” and it is the same format, it is the same kind of thing, but now it is all J. Crew material. It is still additive, still useful for me as a reader, but sponsored.
JASON: So, in a way, it is more effective advertising for both, the seller and buyer in this case, sort of consumer, because it is content. Right?
JASON: It is in a format, which people like. How clear do you feel people are being with native advertising? Because it is indistinguishable when done well. At its best, it is indistinguishable from a regular editorial that is if you do a great job. So therefore, are users going to be covertly advertised to? You know, when I open my Facebook app on mobile and I see Intuit is liked by my friend, I thought that was actually genuine, and it actually said, “Sponsored” in light gray [font]. Are people doing enough to make it clear in your mind?
MATT: I think I have seen good and bad. I think BuzzFeed has done a great job.
JASON: Have they?
MATT: I think when you are on the main page, and you are scrolling through, certainly, they have done it. Let us just say, once that gets out via social media, and you are coming to it through social media, I think it is still delineated, but it does not matter. Does it matter that when I am scrolling through these pictures of cats that happen to be sponsored by Friskies? Does it matter that it is actually sponsored? Whether is it still interesting content?
JASON: That is a moral question, I guess. Actually, that is like an existential question, “Does it matter that was paid for or not?” Because it is done so well. But I guess the question is, “Disclosure is necessary by the FTC.” We have this consumer protection, so you are saying when you do see it in that main feed it clearly says, “Our partner post.” I agree with that. But it’s a very astute and textured point, you are making, which is, when you get a permalink page, and you just see ten cats, nobody would take the time to look for a sponsor. It is so tightly connected to the native editorial that you would not even see that is a partner post.
MATT: The way, that I would like this is to something else going on today, is to think about movies and television, because if you were to watch a television show today, you are probably being advertised to far more than you realize, because as soon as he pulls up, you know… I watched Community a few days ago, the episode of Community, I noticed that because I have recently purchased one, but HTC One, which is a new Android device, a new flagship Android device, the dean of this college in this show pulls one out of his pocket, and he is using it on the show. Now, that was paid for. There is no question to me that was paid for.
JASON: But you are assuming that.
MATT: Well, I am assuming that, but again, going back to how consumers see…
JASON: How would the consumer ever know?
MATT: Consumers do not know. It is like when the car, which Tony Stark in Ironman drives, is an Audi R8. Audi paid for that. They paid for a part of that movie to make that scene happen. And as a consumer, do I care? It is in there, it is a cool product, or whatever it is.
JASON: The R8 happened to be the car of the moment.
MATT: It is already happening in television, and film, and music, and music videos, and things like that. It is inevitable that it is going to make it.
JASON: Should there be a disclosure? Like, when you see the car on the screen, should there be a little thing, that is a star that says that was paid for?
MATT: I believe they were working on that in Europe in the UK, right?
JASON: I am not sure.
MATT: Where there is a little indicator that comes up as part of the screen, that says this is sponsored or something like that.
JASON: Wow! How annoying to the narrative that you are watching a James bond film, and like when the Heineken in his hand or the BMW.
MATT: Or the Breitling watch gets pulled out.
JASON: Oh! My God! You would have to have like a little floating pop-up video.
MATT: The question is, “Is it additive? Does it matter? Do we care?”
JASON: That is an artistic question, isn’t it?
MATT: I think so, but distinguishing, let us say BuzzFeed content from the Atlantic debacle, if you remember the…
JASON: Yeah. The Scientology and the tide. Describe it for those who do not know.
MATT: So there was a moment where there was a native advertising bit done by the Atlantic that was Scientology and they were, I do not know, talking about their recent buildings that they had or…
JASON: Their huge victories. Because they were crashing it.
MATT: Right, exactly.
JASON: They are doing so well.
MATT: That was the case where coming in from the Atlantic property, you would have known that was a sponsored content. It was completely indistinguishable from their normal content, if you came in through social media. So all of a sudden, it looked as though the Atlantic was…
JASON: …writing story.
MATT: …fluffing up about Scientology. You know, and that is totally off brand for them, completely. So that is an example, where I think the kind of content is what matters.
JASON: Maybe, I am being a cynic, I think that they knew that was going to occur, or at the very least, Scientology knew that was going to occur, or that they may have manufactured that controversy, because you just think about the amount of attention that got. It got a hundred times the attention, a thousand times the attention, perhaps, that it would have gotten, if it had not been so orthogonal to their brand, which is a brand that is based on cynicism and truth, which religion sort of is a target of, typically.
MATT: I think it is interesting. I could not decide, one way or another, whether that actually…
JASON: Did you think that too, that there was there a bit of like, “Let’s see if we can poke the tiger and push the envelope,” by somebody?
MATT: I actually thought it was one hell of a flop.
JASON: You just think it was a pure mistake.
MATT: I think it was a pure mistake, but I do not think that they intended on getting scandal. Whether it was intended or not. When you think about it, social media blew it up. It was the Facebook, then it became the cyclical thing, where it just blows up, and blows up, and blows up, and it gets hotter, and hotter, and hotter. I think that is probably something that they did not intend.
JASON: Yeah. I think that the Scientology marketing department had basically gamed or trolled the Atlantic.
MATT: It is possible.
JASON: I think that they knew that it would get a disproportionate response, and maybe, even manufactured some of that kindling for the fire that eventually burned.
MATT: It would be smart if that were the case.
JASON: I think so. I could see very well, that you have created this nice tight editorial format that, if BMW comes out with a new electric car, that following the electric car and seeing the updates as it goes that would be something that BMW would be pretty pleased with.
MATT: Absolutely. I mean it creates a closed-loop relationship between the advertiser and an individual being advertised to. Frankly, it is interesting content. It shows intent, possibly, to purchase. So you know, and as a reader, if I actually care about this electric car thing, then, why does it matter that it is an advertiser providing this information to me? I still think that I go back to the era of Mad Men, and think it is information. It is information coming to me that might help me with my purchase patterns, whatever it is. It is just something interesting to me.
JASON: What is the New York Times or CNN thinking about what we are doing? Obviously, when you got a startup that is starting to innovate or clack teeth like this, how did they look at you? I am sure some of them have reached out. What is the mainstream media thought of your process, product?
MATT: We will separate the process from the product. You know, the product itself I think…
JASON: … on their radar?
MATT: I have actually spoken to CNN, and the New York Times, and various heads over there, and I think they look at us with intrigue. I think that they… [are jealous]. I do not want to say, “Jealous,” because that is not the right word, but we were able to do something, that they are not able to do, because they have legacy. Right? They have a legacy business model. I do not mean like old [business model]. I just mean that they have things to worry about that I do not, frankly, have to worry about. I can find new and interesting ways to do things and move much faster, than a big behemoth of a news company.
JASON: That has to get the Sunday Times out every Sunday for five million people.
MATT: And they had to do their pitches. You know, all their editors pitching to who gets the lead, and, you know…
JASON: If anything, they are jealous of your freedom.
MATT: That is absolutely right. I believe that is possible.
JASON: Now, the format. When they look at the format, you are not doing original reporting, you are doing meta-reporting.
MATT: We are doing original content. That is the way that I would put it. Meta-reporting is actually a great way of putting it. I think that, when people look at it at face value, they think that we are just doing straight sourcing, like, we are taking one source, rewriting it a bit, and then sticking it into our pieces, but that is not it at all. We actually go through a very traditional process. When we are developing our news, when we identify a story that needs to be written, our writers go out there and collect their sources that they think are most appropriate to put in there. Then, they go and identify, “Here are the five facts that we need to convey.” And they say on the point-by-point level, “Here is one fact, and it’s corroborated by four sources.” In our back-end, it is actually supported in that way. We require them to list every source with every single point.
JASON: You get that in light gray at the bottom of the update or… How is that implemented?
MATT: There is a little “i” button, and by clicking on the “i,” you can actually open up and see the sourcing for everything.
JASON: Yeah. Did they feel you are leveraging their product too much? Do you get that sort of mainstream media disdain of “reblogging?” Because we did Engadget, and Autoblog, and Joystiq, and bunch of these blogs, people felt like, “Oh, well. You are riffing off of our ten thousand word article.” On ten thousand word article, we might write five blog posts. Now we have five items SEOed against one item, and we win the traffic war. We are writing it based on their work. There was this original, I do not want to say, “disdained,” but a lot of the traditional tech journalists look down upon Engadget. Like, Peter Rojas was doing something [disgusting], I do not know. He was just giving his opinion. He was just riffing on what they had already discovered, but his opinion was so much more interesting than their original reporting, that he built a huge brand off of it. How did they look at you reblogging them in that parlance, or rewriting them, or redigesting them, meta-reporting?
MATT: Because it is multiple-source reporting, I do not think they have the same kind of problem that if we were to take one source, one story and tell it in a different way. I think that it is a very big distinction. Frankly, we have not had people reaching out to us and complaining specifically about that. We have some specific journalists who have been like, “I am not sure about that,” and then we have a conversation with them, and they are like, “OK. That is actually pretty cool.” As far as the way that we collect our facts, the way that we put it together, the way that we put it out there.
JASON: What was the reaction? You take me through an example without mentioning the journalists, but you know, how did they approach you? What did they say?
MATT: This conversation has actually happened a few days ago with an individual, where they thought that we were inherently hiding, like, trying to prevent people from going to their original sources through our little button that you can click and see that. Now, we were like, first off, it is not hiding, these are sources that we are citing. It may be that one fact comes from four different places. Is it valuable to the reader to know that one fact was in these four places? Or is it that valuable for people to know the fact, and then for us to send people along to an appropriate place to read further?
JASON: Because you do have those little blurbs, where you will call it a New York Times [symbol].
MATT: Yes, absolutely.
JASON: They feel like they are getting some level of payback perhaps, some reciprocation from that.
MATT: Yes. That is the idea.
JASON: But if you did not have that, boy, would they be upset?
MATT: I think that would happen.
JASON: Which is the Huffington Post and Business Insider folks’ problem. That is a valid concern that people have about their products.
MATT: It does happen. Yeah. Single sourcing type stuff. Yes.
JASON: Let us get back into that. The Huffington Post and Business Insider too, when in their worst moments, which I would say, it’s probably like a third of their editorial, they are simply cribbing other people’s stories, I mean, outright stealing, some people would call it. Do you agree with the stuff they do like that lower end? Obviously, you get Henry Blodget, or Arianna Huffington, or George Clooney writing some great piece, an opinion piece. I mean, “great” is debated, but whatever. So that is obviously valid original content, when they do that reblogging, and they out-SEO and out-social the original source, what do you think of that?
MATT: I think it is a hard question.
JASON: What do you really think? I mean, come on! You are a news guy.
MATT: What I think I would prefer is, let us just say, like a short snippet and traffic back. You know something like what John Gruber does with his Daring Fireball stuff. So I like that kind of a link blogging type stuff, where you are sending traffic, you are saying, “I have identified this interesting thing, here you go.”
JASON: Maybe, here is my take on it, because he does that perspective.
MATT: But this sort of remix culture, this sort of thing, where even like Tumblr is reblogging and stuff like that. Now, what is great about Tumblr is they have built attribution into the product very cleverly, where no matter what you can always find the original source of a particular reblog. They are built into the metadata and it exists. The problem is that we do not have that kind of thing inside of this ecosystem. Sometimes it gets bad, because if you were to take a piece, which maybe had a factual inaccuracy behind it, and you copied that over and you reported on that, well, when that original piece gets updated, it does not update elsewhere. So you can start to have some of these weird chains of events and, honestly, I think that stuff is going to fall out. I do not think it is a valuable medium right now.
JASON: So it is just trickery. It is people trying to SEO game, to get a little bit extra traffic.
MATT: Hey, it worked. I mean, there is no question. So now, the question is…
JASON: Fake it until you make it.
MATT: … was that candy? Which just taste good, and you just want more, and more, and more of it. Or how do we get something more substantial?
JASON: It does feel like people are optimizing for wasting time. I mean you go to Business Insider. I am not going to harp on Business Insider, but the two sites that did garner the most traffic, and BuzzFeed would be the third. They all seem to share in common this theft. Most journalists would call it theft of other people’s IP under the auspices of fair use, or “I rewrote it,” which you are doing as well, rewriting, but for some reason, when they have executed on it, it feels like stealing. Why does it leave such a bad taste in people’s mouth?
MATT: Well. Distinguishing us from the rest of the process, it is the single source piece. It is the fact that there was one place, and they took that one bit of content and translated it, right? In Circa’s case, it has many different things, we are identifying the fact, and then we are creating our own thing. There was an interesting tool that came out, I think it was yesterday, I do not even remember the name of it, but one of our engineers pointed it out. The idea that you could copy and paste something in, that let’s just say, it was a potential rewrite, and they would scour its database of news, and then figure out what the original place for that was.
JASON: Right. By time stamp, or something.
MATT: It was just like, “OK. What words are they shifting around?” And stuff like that. So we actually were, “Well. Let’s test ourselves!” We threw some of our own news in there and it did not come up. Which meant that we are doing a significantly good job in… , again, I do not call it rewriting, but identifying a fact, and then producing content around that fact, and then going the extra step of citing resources. It is very different things, but I do think that when you take one source, remix it, and then put it back out there. That is just not necessarily something I am too keen on.
JASON: Yeah. You seem to be very keen on a serious tone. Do you think that is the opportunity? Or do you think the BuzzFeed kittens are the opportunity? I noticed a distinct lack of kittens. So, why no kittens?
MATT: Well, you know I think that there are many different ways to take a product. I think that people are in a place where entertainment feels good. You know, they just want to feel good, and they want to see all these things. Now, BuzzFeed does a really interesting thing, where you can get lost in this like kind of levity of just running through all these funny posts in cats and so on and so forth. Then, there is one about gun control. I think that is like the Trojan horse for people, where it is like, they are just being entertained to, and I just think they are being entertained to, and all of a sudden, there is something serious. They are still like, “Cool! Done. Got it. Read it.” That is awesome and I think that is just a different angle of looking at. In our case, it is just not something that is core to our product. We want to get the news out there. We want to be a newspaper for people. We want to be some place that they can trust, that they can see, whatever the news of the day is. So, we want to be ultimately informative to our readers, and so it just does not align with our goals.
JASON: Do you see yourself as a better version of the New York Times, [the] Washington Post, as opposed to a better version of Gawker or BuzzFeed?
MATT: Yes. We are a publication. That is the way that I see it.
JASON: The people who you hire, they are doing this meta-reporting as I called it, but it is deep research based reporting, is that a different type of traditional journalists? Whom are you hiring to do this? What is the hiring process? Who makes a good Circa journalist?
MATT: They are journalists. These are people, who have written for the Atlantic, have written for the LA times, they came out of J-school. These are the kind of people that we are looking for, and these are guys who just want to inform the world, you know. We do not have bylines in our products, and that is part of it. And part of the hiring process is making sure, “Hey, are you cool with no bylines?”
JASON: Very [the] Economist’s [style], right? The Economist does not have bylines.
MATT: Just like that. Yeah. The idea is that these people are concerned around the overall quality of the product, of all the news. Right? It is just not their own contribution, but it is the totality of all of their work together that they feel prideful about. So, it is a different kind of journalists that we look for, but I can tell you that is without a doubt high-quality journalists whom we have been hired.
JASON: At some point, do you tip over and do original reporting? Have those acts of random original reporting occurred already?
MATT: I think that there are ways to do it. I think that though, the way that we think about it, is we are trying to develop the most efficient ways of developing news, and we have already done that for our current process. Reporting by nature is a highly inefficient process, and doing investigative reporting and things like that. So, how do we identify the best ways of getting that done without it becoming a money pit, for example? I think we have some interesting ways, but it is going to be a little while before we can implement.
JASON: Like, ask the question. He-he. Yeah.
MATT: That is a very simple way of getting it done, but…
JASON: I guess I just can see that, when you are flipping through, just asking a question like, “Is there somebody in the Circa audience who works at SpaceX, who would comment on this?”
MATT: Sure. Opening up that wall, and providing an outlet, I think there are definitely opportunities.
JASON: So, who are the investors in the company? What do you need to do to get it? I know Ben Huh from Cheezburger [Network] who has been one of the founders?
JASON: What do you have to prove? You raise another $750k just this year, that obviously, takes you about a year, I am guessing, so what do you have to prove a year from now to get that big venture round? Because VCs, I am a content guy too, obviously, boy, did they hate news business, boy, did they hate content business. So angel investors you can line up real quick, but the news … [is not funded].
MATT: I think that we have to prove that things could be done differently. In our case, one of the things around content, specifically, is that we have found out that our model… Traditional content production model is linear, meaning that the more people I add behind it, the more news are created, but it was always across the same line. Our content production ended up being exponential. We did not even know it. It just happened that way. That is because when a story like the Lance Armstrong case happens, and we build one story to start, it is five points, and then over time it is like, oh, there is one new update, we add one new point, and two weeks later, we add one new point. Everywhere else, they are creating these boilerplate five hundred or thousand-word pieces for every update, and so our process ends up being more efficient, because we add one new update, and go, and do the next story. One new update, go to the next story. So rather than it being linear over time, the more of this basic content, that we develop the more it just draws that line up, it increases exponentially. So we are trying to go in, when we talk to these investors and things like that, it’s about, “We have created an insanely efficient way of producing news and as a result of that, it turns out the reading experience is actually fantastic.”
JASON: It reminds me of Weblogs, Inc., where we actually told people, if you take the editor out, and you take two-thirds of the cost out, because editors have to be paid twice as much as the writers, and the content turned out better, if it was a passionate writer. So when you got rid of Peter Rojas’ editor, or Ryan Block’s editor, or Xeni Jardin from Boing Boing who worked for me for a long time, if they were not edited, they were better.
MATT: It is a definitely interesting concept. Right?
JASON: OK. We are spending less money on their words, and the words are getting better. What just happened?
MATT: If you can illustrate, how you are different, and how you are taking things, which would otherwise be very inefficient about a content production model, and show, “Hey, this can be done differently.” Then not only is it interesting from a company standpoint, but also it is a disruptive thing. You know, it is like everybody else is doing it this way, and they are all tanking in different ways, but we have this new angle on it, and then as a result we can succeed. So I think those are the kinds of messages we want to convey.
JASON: Listen, Matt. It is a great product, and I am a huge fan, and I have been using it and very impressed. Obviously, I am building Inside.com, which is going to be in the news space as well, and not exactly the same, but… You know, I think it is going to be a whole cohort of people, Flipboard, I guess, yourselves, and is there anything else? I mean, Flipboard, is it interesting?
MATT: Yes. If we think of Circa like a newspaper, I think of Flipboard like a magazine, where there are just lots of content for me to consume casually. I think that they are doing some interesting things with being able to curate, for instance, your own magazine.
JASON: That is a fascinating concept.
MATT: It is really interesting.
JASON: I really think that was interesting. Is there anybody else that you look at and say, “That is fascinating and interesting?” Because I get Circa and Flipboard, and then I go into my iPhone, and it is a big long drop-off.
MATT: I absolutely love Prismatic, actually. I think they do a fantastic job of identifying things that I would find interesting. Now again, it still feels like a magazine to me, where it is just an endless amount of content that could be interesting to me, and I probably open up a story, probably, five percent of the time, but it’s still interesting to go through and have it learned all these things, which I like, and then be able to find the one gem of an article that I may not have seen elsewhere. I use Circa, Prismatic, Flipboard, a handful of other things, but those are the ones that I would concentrate on.
JASON: Listen, Matt. This has been great. Everybody, follow @mg and follow @circa on Twitter, and download the app and play with it. Every two or three months a great update comes, and you are making great progress, I think. God, just please do not sell to the New York Times. I know they are trying to take you, guys, out early. I hope that you can raise that venture round, and really go for a long ball here.
MATT: We got some interesting things coming up.
JASON: Awesome. All right. Do not sell! If the New York Times comes right now and provides whatever, 20X return for your investors, do you have to sell or are you long?
MATT: I will be honest, I am long on this business. You know, I have sold two companies before. The first one was sold in fifteen months, the second one in twenty-four months. You know, I want to build, I want to prove that we can become the mobile news company in the same way that CNN came along and took the television format, made it their own, and develop that. We want to become synonymous with mobile news. We want to be the mobile news company.
JASON: All right. Please, please, do not give up. Do not sell! Please, do not sell.
MATT: I will do my best, Jason.
JASON: Please, do not sell because I really think that, if this exists five years from now, it is really going to hit its stride in year four, five, and six. All right. Thanks to our sponsors: New Relic and ShareFile. Everybody, go thank @newrelic, thank @sharefile for sponsoring independent media like “This Week in Startups.” You should go and support independent media like Circa. If you are an ad buyer for like, I do not know, BMW, or Coca-Cola, or Red Bull, just get your checkbook out, $50,000, experimental budget, give them 50 dimes, and let them play. It is worth it, right, Matt?
MATT: I think so.
JASON: He-he. I see you next time on “This Week in Startups.”