Outside.in, the three-year-old placeblogger/hyperlocal company, is in the enviable position of being able to focus on building its blogger platform and network. Its lead investors, including Union Square Ventures and Esther Dyson, have given it an especially long leash, convinced (like Twitter and others) that revenues await high-volume sites down the road. And the company is getting there, with usage growing from 800,000 unique users in September 2008 to 4.2 million today.
Last week, I visited much of the company’s brain trust at its Brooklyn headquarters, including CEO Mark Josephson, Cofounder and Chief Product Officer John Geraci and VP of Business Development Camilla Cho, a former exec with MTV. Josephson said the key to understanding Outside.in is to recognize that the relationship between writers and publishers has forever changed. “All local publishers know they need to go hyperlocal,” he says.
Given present-day economics, with newspapers beginning to fail, most local publications won’t succeed if they’re relying on their own staff for more than 20 percent of their content, says Josephson. The rest must come from the community. It’s the 20/80 rule in reverse, he observes.
With so much content coming from outside a publisher’s wall, it isn’t just a matter of working with the right content management system. “CMS — forget about it. We’re all publishers,” says Josephson.
The real challenge is to get bloggers in the loop, highlight the best content and then, of course, sell high-value, targeted advertising around that content. “It is not about the destination site,” he says.
Indeed, Outside.in’s real job is seen as “curating, aggregating and networking.” It’s probably a more comprehensive role than vertical networks, which only aggregate, argues Josephson. Other sites may be too focused on a curatorial role.
Ultimately, it all comes down to getting bloggers to write the content, and publishers to distribute it. Outside.in already has 3,000 bloggers under contract all around the U.S., providing them with state-of-the-art dashboard tools, including an embed map that allows them to map their local stories, and GEO-SEO, so they can be found all over the network (and the Internet). That’s the key to the service.
The company, however, doesn’t currently provide a revenue share with its bloggers. That’s between Outside.in and its publisher partners, which include NBC and several other high-profile media partners that haven’t yet been announced.
But there are plans to help bloggers monetize their pages. “Today we are driving traffic; tomorrow we’ll drive revenue,” says Josephson.
Meanwhile, the ability to narrowly target such a volume of users is already beginning to have dividends. Performance levels are 2.5 times what AdSense experiences, says Josephson. “And that’s just Phase One.”
Cho, Josephson and Geraci at Outside.in