Backfence and Local Communities Online
Everyone involved with any aspect of local blogging has spent much of the last week talking about BackFence, since the chaos going on behind close doors over there seems to have spilled out into the street. Quick background - The company was founded in 2005 and raised a VC round of $3 million with just one local site online but with the promise of selling ad space on that and more community sites they would continue to develop. Over the next year they added several sites and acquired Bayosphere bringing their total to 13 sites. This month amidst claims of Execs and board member disagreements, there have been massive layoffs (some reports say that 12 of the 18 employees were let go) capping with the CEO walking out this week.
Wow.
So what the hell happened? I think the biggest, most obvious problem is that BackFence was trying to sell a community that they didn’t have. I’ve never talked to any of the folks there, but from following their project for the last year I got the impression that they believed simply putting a site online and calling it a community would create a community. As someone who has been involved with a number of online communities and is obsessed with local media, I’m not of that opinion.
It seems that I’m not alone in that take either, Amy Gahran wrote on Poynter Online:
“In my experience, community-based online media thrives when there’s strong participation and collaboration. It’s not enough just to read the news there, or even to publish your own stories there. And Backfence never really got the participation/engagement part down, as far as I could tell.”
Greg Cohn said something similar in this comment on PaidContnent:
“As anyone who’s successfully built a community-based company will tell you, it’s authentic community cultivation first, features second—and those features should be highly driven by the desires and quirks of the community—and marketing third.
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“As for Backfence, nobody I know is surprised by their failure to take root given their “if you build it, they will come” approach, their tackling of the three needs above in reverse order, and their business decision to take venture capital to franchise and expand a model they had never proved and were ultimately unable to make work even in a single flagship location. Bayosphere’s failure as a business was equally unsurprising given its failure as a community…”
It shouldn’t be surprising that the “community” in a community site is a very important aspect. Even more so if that is part of your sales pitch. Of course this hasn’t stopped people from speculating that it’s the idea of local blogging as a business that is flawed rather than this specific execution. Folks like Mark Boland, Mathew Ingram and Fred Wilson are asking out loud if aggregation sites, such as Placeblogger are a more sustainable, and scalable option.
Obviously at Metroblogging, we disagree with that notion. Don’t get me wrong, I love sites like Placeblogger and Outside.In - I’m a local junkie so the more avenues to find cool content the better - but the content is what I’m ultimately looking for. I’ve never considered aggregation a business model because it’s so easily replicated, and customizable with any number of tools that anyone online has access to. While these services are fantastic for finding new things, on a daily basis my own RSS reader serves up a more tailored collection of content that was built to my specific needs. Good content on the other hand can only be found at it’s source.
Susan Mernit jumps into the discussion saying:
“One thing it’s hard not to mention when we get into this hyperlocal, sustainable business question is the issue of scale. Most of the really good–and viable–hyperlocal sites–are small businesses that serve a focused audience, with decent ad revenues but nothing like the big numbers VCs need for their $5 to $13 MM investments.”
So certainly scaling is an issue, right? Well yes and no. Putting $3 million into an thriving community is going to have an entirely different effect than putting $3 million into a community that doesn’t exist. Scaling correctly with local can be boiled down simply to not putting the cart before the horse. It’s been over 3 years since we launched our first local blog in Los Angeles and we’ve been growing consistently every since to the point that we now have sites in 51 cities around the world. Of course we’ve had speedbumps like anyone else, but the more we trusted in our community the better things have worked out. A major turning point for us was when we stopped building blogs in cities where we thought we should have them and started building them in cities were people were asking for us. Our blog in Karachi, Pakistan is a perfect example of kind of thinking. We let the site itself (it’s readers and writers) point the direction we moved in and it’s become one of the most vibrant communities in our network generating almost 24,000 comments in the last 2 years (just recently passing up our original Los Angeles site which is currently around 24,800).
An issue that comes up again and again with local is just that, it’s local. By definition this means it is “pertaining to a city, town, or small district rather than an entire state or country.” You can’t compare a site about gadgets to a site about the city of Portland. The audience is inherently different because while there might be millions of people around the world wanting to read about gadgets, there are only half a million people living in Portland. On a local level there is a cap at how many people will ever be readers of your site. Expecting a million or more views a day from a blog about a city with less than that many people in it’s entire population is insane. For contrast, the Portland Mercury, one of the largest and most successful alt weeklies in the country, prints just over 40,000 copies a week. On a local level, it’s more important how many people in that city you are reaching.
However on a global level, there are an unlimited amount of cities which is where a network of individual city blogs like what we’re building with Metroblogging really has the ability to scale. To this date we’ve never taken any outside funding and if left completely alone our sites will continue to grow and generate more revenue each month. Of course with increased traffic comes increased costs of keeping the sites online, but the existing community is what allows this growth to sustain itself. Taking funding before the community exists simply puts too much strain on the sites and doesn’t allow them to grow.
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A few other people talking about this:
BackFence CEO Resigns Amidst Downsizing - Local Onliner
Behind the Backfence Breakup - Matt Weir’s blog @ New Assignment
