NowPublic.com — the “citizen journalism” site based in Vancouver — has turned down takeover bids from two major media entities (both based outside of North America) and closed a $10.6-million financing round with a series of U.S. and Canadian venture funds. I wrote a news story about it for the Globe and Mail
Update: TechCrunch has the news about the financing (but not the acquisition offers), and there is also some coverage at VentureBeat and at GigaOm, where Liz Gannes also talked to Leonard Brody.
It’s one of the larger — and possibly the largest — Series A financings of any citizen journalism site (OhMyNews.com of South Korea did an $11-million led by Softbank at one point, but that was a Series B financing). The round was led by Rho Ventures out of New York, along with previous seed investors Brightspark and Growthworks out of Toronto. NowPublic said that after a road show with about 20 venture funds, it wound up with nine term sheets or expressions of financing interest.
The deal is a major vote of confidence not just in NowPublic, but in the idea of “crowdsourced” journalism or “citizen reporters,” and stands in sharp contrast to the recent closure of Backfence.com, a high-profile citizen-journalism project that had half a dozen local sites.
I talked on Friday with CEO Leonard Brody, who co-founded the company two years ago with Michael Tippett and Michael Meyers, and he said NowPublic is now the largest citizen reporting venture in the world, with more than 100,000 members in 140 countries and 3,800 cities.
Brody said that the company considered the acquisition offers, but “made decision that we felt we could grow this thing” and that it was just too early to sell. The NowPublic CEO said the company is focused on its plan to “build the largest news agency in the world” and that he is convinced they are building what will become “a billion-dollar company.”
NowPublic has 20 staff employees in all, with offices in Vancouver and New York and several employees each in Germany, Hungary and Slovenia. Unlike OhMyNews.com, which has about 50,000 members, NowPublic does not have any professional editors on staff, although a former CTV reporter plays the role of “Actual News Guy” in helping select stories.
NowPublic has also expanded its previous content-sharing deal with Associated Press. Under the original arrangement, AP’s foreign bureaus could have access to NowPublic photos and news reports, and Brody said that relationship has been expanded to include the wire service’s U.S. bureaus.
Brody said the money would be used to expand operations, beef up NowPublic’s technology — including adding more mobile features such as automatic GPS geo-location — and that the company is also looking at compensating members who submit eyewitness news reports, photos and video.
Compensating members of a “crowdsourcing” effort such as NowPublic or even a video-sharing site such as YouTube has been a major source of debate over the past year or so. While Brody said he doesn’t think most members submitting things to the site are motivated primarily by money, NowPublic is thinking about ways of compensating them, monetary and otherwise.
Some NowPublic members have already done deals with AP as a result of items they submitted to the site: a member from Oman who posted photos of a storm later sold his shots to Associated Press and they were used by Yahoo News, Forbes magazine and several other breaking news sites.
Of the Backfence.com closure, Brody said it was “a sad day for citizen journalism — they were pioneers.” But he said that NowPublic has a much different model from Backfence, which focused on “hyper-local” reporting, while the Vancouver site is targeting a global market. Interestingly, Brody said he didn’t see hyper-local journalism as a very good business model, at least not for younger Web users.
“For people 35 and under, hyper-local doesn’t mean anything any more,” he said. “Local weather, news and that kind of thing is a commodity, and there’s lots of places you can get it. We’ve moved from that to hyper-personal news… younger users check their Facebook feed way more times a day than they check CNN.”
Congratulations to the team at NowPublic on closing the deal. It will be interesting to see what kinds of uses they can put that $10.6-million to over the next year or so.