12 Business-Building Lessons from Skift's Rafat Ali
Rafat Ali is a tweener and twofer. He’s both a journalist and an entrepreneur. He understands audiences and technologies. He knows the news business inside out and likes to spend lots of time in the world outside the news.
Taking a couple of years to see the world (10 countries), the 38-year-old Ali is now on to Skift, a B2B business site that is getting lots of due attention given Ali’s track record with paidcontent.org. Skift wasn’t born out of his recent travels, says Ali, but informed by them.
“Though the idea of Skift was not born out of my travels, the kind of places I went to were offbeat, and the information needs on those
trips were higher than other more popular trips. To gather that information, I would have to resort to posting in forums on the web, like Lonely Planet’s Thorn Tree forum. That made me realize the randomness involved in travel information, and with Skift, we’re trying to take the randomness out of the equation, and make it more through news, information and data.”
Ali, a journalist, founded paidcontent.org in 2002. for about $30 million, he sold it to Guardian Media in 2008, which re-sold it to GigaOm (where it seems to be finding a more congenial home) earlier this year. When Ali’s paidcontent.org first burst on the scene, it helped create a new view of emerging news+ industries, way ahead of actual “paid content.”
Now as CEO and co-founder of Skift, doing some curation, he’s building out a new kind of business, in a vaster business sector. Travel, says Ali, is the largest employer in the world and is probably third in revenue behind finance and automotive. Lots of potential readers and advertisers.
The site is itself, well-built out at launch is testimony to how much experience, clarity of vision and smart use of technology can accomplish in 2012. As such, it’s worth extracting some lessons for everyone in the publishing trades from the Skift start-up. Here are 12:
- Work your network. Ali put together $500,000 in seed money from those he’d met along the way, including the well-known and much-experienced Chris Ahearn, Gordon Crovitz, Jason Hirschorn, Tom Glocer, Luke Beatty, Peter Horan, Alan Meckler and Chris Schroeder. There are 17 angel investors overall. While the money contributed is small, their network of contacts is great.
- Work the yin and the yang of the topic. Deep knowledge of a field is vital, and Ali’s co-founder is Jason Clampet, a veteran of Frommer’s, Citysearch and Rough Guides. Then, for Ali, coming at the topic with fresh eyes, could be a great complement.
- Use technology to do the heavy lifting. NewsCred (“The newsonomics of syndication 3.0, from NewsCred and NewsLook to Ok.com and Upworthy), a new mover in the text syndication, made it convenient and cheaper for Skift to get at lots of top-brand content (headed Reuters, AP, Guardian, Telegraph and Bloomberg) to run through his aggregating, curating technology. Ali estimates 30-40% of the site’s content comes from NewsCred. Look for the addition of syndicated news video next, a natural for a travel product. Building on WordPress, Skift has been able to use the technologies of the day to put out a substantial, first-look product with a staff of three. That should be a wake-up call for legacy companies saying they don’t have enough staff to innovate well.
- Pick your spots with original content. The “Skift Take” appears on most stories, right there at the top, at Twitter-like length, that tries to extract the meaning of a story in a few words. Down the road, socially sharing these tweet-like summations could become a powerful traffic driver for Skift. As importantly, says Ali, they define the attitude of the site. Attitude here is a key part of the Skift brand. “We will take positions,” says Ali. Bringing an aggressive journalism to a B2B field could well shake it up.
- Think crossover. Crossover here means both business-to-business and business-to-consumer audiences. The launch site is all B2B, but Ali will target professional travelers as well. Skift may find it tough to serve both audiences well with a single interface, but even the pairing of Skift Pro and Skift Road Warrior could pay lots of dividends. Much of the content and thinking is parallel, though the presentation to the two audiences will need to be markedly different.
- Pick a business that is ad-rich. “The number is 50 times greater than my old company,” reminding us of the relative smallness of the news and media industries. Just take the four main travel verticals he is planning to cover — and tourism, hospitality, cruises and transport — and the mind boggles.
- But, don’t depend on ads. With the domination of the ad trade by the Big Five digital ad companies (who control 67% of U.S. digital advertising, with their share increasing every year), the ad revenues for everyone else is increasingly uncertain, witness the flattening of digital ad revenues for newspaper companies this year. So, Ali is looking at data and its mastering as a lead revenue source. His key word is “services,” meaning applying data and market intel to help vendors solve their own business problems.
- Get the data for free, and transform it into intelligence. The government creates lots of data, sitting in government and semi-government repositories, in Excel and Word formats, and it’s ready to be harvested. Think Everyblock for the travel business. Look for it to borrow a page from eMarketer and BusinessInsider, which both aggregate other data and putting it easy-to-read, easy-to-compare form.
- Pre-qualify the business as tech-ready. As Ali points out, travel — with booking and recommendation engines, and inventory management — has had lots of technology applied to it for a long-time. Ali knows the data he plans to make his lead business is something travel enterprises already value, so if he can deliver data of value, it should be ready to be used.
- Make simplicity out of chaos. Think about audience needs and what it needs. For instance, Ali mentions a travel app recommendation engine. The important notion, which we see repeatedly on the web: making simplicity out of chaos. There are many travel apps, many of which seem redundant, but which are best?
- Make an industry more interesting. “How can you make travel boring?” Ali asks. Skift targets Travel Weekly or Aviation Weekly audiences in part, believing they are ripe for disruption. For newsies, think of the standing of Editor and Publisher 15 years ago, and its decimation by top news blogs. “We’re trying to bring [to the topic] that energy, that conversational style that media, tech and finance [digital coverage] has. We want to connect the dots.”
- Don’t get trapped. On reflection, Ali believes that paidcontent.org “got trapped into doing some things for years and years, like in the dailiness of blog posts arranged in a certain manner, and a newsletter. I want to avoid that. That traps you into a model you can’t get out of it.” paidcontent struggled with what to cover on the “traditional” side of the business, as it focused on digital. His new site has departments, looking more like a magazine than a blog site, which should provide more flexibility. “We don’t want to be called a blog media company; it’s hard to scale.”