Via Independent.ie: Within three years of launching its first product, NewsWhip counts ESPN, BuzzFeed, The Guardian, USA Today and The Irish Independent among its customers.
Signing up big media organisations is no mean achievement and a testament to the achievement of an Irish startup that has successfully navigated the tricky road to commercialisation.
With around 300 customers expected to generate over €2m revenue this year, and 15 staff split between the Dublin headquarters and a New York office, the firm is growing fast on the back of Spike, a product that helps organisations monitor the impact of content that’s put out on the internet. Spike tracks what NewsWhip calls ‘the social velocity’ that content picks up through likes and shares on social media.
The media industry loves it because they get real-time visibility of news stories that go viral.
Ironically, NewsWhip is serving an industry that it originally planned to join. Co-founder Paul Quigley had intended to fulfil a long-standing ambition and launch an online news site, pitched as Ireland’s answer to The Huffington Post. It went live in 2010, but proved to be a hard slog with regular readers proving almost as elusive as online advertising spends.
Quigley pulled the plug when he had his Eureka moment. “Someone said to me that the most interesting companies online – like Facebook and Google – are not producing content, they are arranging everything else that is out there,” he recalls. With co-founder Andrew Mullaney, they set about developing an algorithm that would form the basis of Spike. The two had met on a course for new digital businesses run by the Dun Laoghaire Institute of Art, Design and Technology.
They developed an idea that they took further with help from the NDRC LaunchPad accelerator programme, and secured initial investment from entrepreneur-turned-investors Shane Naughton and Hal Philipp, who today sit on the NewsWhip board.
Next, the founders tapped deeper into Ireland’s burgeoning startup ecosystem, receiving investment from the AIB Seed Cap Fund managed by the Dublin Business Innovation Centre (BIC). This was supplemented by angel investors in the States and then matched by Enterprise Ireland to take it to around €850,000.
Eugene Smyth, an investment manager for Dublin BIC, considers NewsWhip a good example for budding entrepreneurs. “Paul and Andrew have shown how to use all the disparate initiatives that were put in place after the economic meltdown,” he says. “It shows that everything the State has been doing for startups over the last seven years has been the right thing. Smart investment money such as the AIB Seed Fund is available for good companies that come to us well-prepared with guidance from organisations such as Dublin BIC and strong support from Enterprise Ireland.”
Startup initiatives help to smooth a path, but they don’t knock down walls. You need entrepreneurial chutzpah to do that, something that the two founders have in abundance. Andrew Mullaney already had one start-up under his belt, having launched the Easy Deal web site after leaving Accenture. Paul Quigley started a local newspaper in transition year then another one at university. One summer was spent rescuing golf balls from a lake on a course in France and then selling them to Paris golf shops.
When he got a job with a New York law firm, he looked all set for a rarefied career in international law, but the entrepreneurial bug bit again and he came home and started NewsWhip. Now in their 30s, the two men complement each other’s skills, most obviously in the development of the Spike algorithm. “I had a schematic but could not build anything like this, and Andrew had the technical architecture skills. We then set about assembling our team,” says Quigley. “We went to one of the early Web Summits where one important takeaway for me was that you don’t outsource core functions. So we got to work assembling some great people to develop our tech and help us tell our story.”
Here’s our five-step guide to building an audience on social media: http://t.co/zwD9PlcECY
— NewsWhip (@NewsWhip) May 12, 2015
So far so good, but the plan to simply “rank and arrange what’s there” lacked a commercial model. Early attempts to sell it as a consumer service were soon abandoned. Instead, Quigley’s experience in media had exposed him to the pain points of trying to find an audience for breaking news stories, so he saw an opportunity for turning NewsWhip into a service that online publishers could use. Eugene Smyth believes it was the pivotal moment. “They had too many potential markets in front of them,” he says. “That’s a good sign but you have to narrow it down. The people that needed to know what stories were taking off were the media, not consumers.” Unsurprisingly for a company forged in the internet age, the natural route to promoting this new direction was the web. The company began posting blogs about Spike and offered free subscriptions to try it out.
This generated enough interest to persuade the company to move to a commercial model, a decision that was quickly vindicated. Within a month of charging for access, USA Today had signed up for the service. A project for The Guardian followed soon after. NewsWhip had found its sweet spot.
With the concept proven and investment coming in, it was time to step back, hone the product and prepare for scale. In 2013 the software was overhauled and given a much-improved interface. “I know media is a reputation-based business and I knew that we needed a really well designed product,” says Quigley. “You can get a long way with great sales and mediocre products, but a huge part of what sells a lot of software is a good interface.” With Spike now running on large screens in some of the biggest media organisations in the world, it looks like a job well done. The icing on the cake was a Fox News item that featured the trending graphics on a jumbo screen.
USA Today had signed up for the service. A project for The Guardian followed soon after. NewsWhip had found its sweet spot.
Conquering the world’s media organisations is well underway but there are no plans to cash in on the success. While investors may often be looking for quick exits, Paul Quigley is eyeing up the next phase of growth. With large brands looking to establish closer links with customers, the onus is on generating their own content and going direct to its audience via social media. Part of the process is to monitor what works and what doesn’t. Mastercard, Intel and Wells Fargo have already signed up, suggesting Quigley’s instincts are on the money again. “They are the growth strategy. That’s the big ticket, companies wanting direct engagement with people,” he says.
NewsWhip looks like it will continue to create its own headlines for some time to come.
This story originally appeared in The Irish Independent. Reproduced with thanks.