Foundation 1: How to think about building a viable media business
The lesson
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The transcript
Welcome to this School of Splice Foundation lesson: How to think about building a viable media business.
Rishad: The School of Splice exists for exactly this reason: helping you build a viable media business. I’m Rishad, one of the cofounders of Splice.
Alan: I’m Alan, the other cofounder. We're obsessed with how media businesses are built around the value they create for their audiences — we're here to help you how to think about that.
R: Maybe we should start by defining what we mean by 'viable', Alan?
A: For sure. And let's not conflate VIABLE with SUSTAINABLE. You hear a lot about creating sustainable media — but in this space, that often suggests that the business is overdependent on grant funding and donors. Nothing wrong with that — but we believe that every media company needs to make even part of its own money by serving the needs of its audience. And that's why we call it VIABLE. It is after all meant to be a business.
So even if you're just breaking even, you're viable.
School of School works like this. You can listen to all of this in one go. But you might also want to break it up. Hit pause whenever and come back later.
Some of this stuff is pretty easy, so you can lean back, or take the dog out for a walk. Or just wash those dishes.
Other bits require more involvement — like if we're suggesting you write your thoughts down. So you'll need a notebook and pen. 📔✍️ And coffee. ☕️
R: But back to that business strategy!
Think about where we were even five years ago. Publishers were just starting to learn to read Google Analytics, newsletters were starting to emerge out of newsrooms, while podcasts were starting to become a real habit for many.
But to even start a website, you had to find a WordPress developer, a design person or buy a theme off the shelf, and then try to configure it all and piece it together. You wouldn't even think about commissioning someone halfway around the world to help you design your logo.
A: And to top it off, it wasn't easy to meet people you could learn from. You went to meetups. Networking events — ew. Or cold-emailed people.
If you were to build something today, you'd have different tools to get started. A lot of them don't require any of that friction. Or code. The "no-code" revolution means that most of us can create whatever we want from simple online tools.
You'd use Squarespace for websites. Or Carrd.
To send newsletters, you'd have Substack, or Mailchimp, or Revue.
And if you wanted a bit more flexibility, you could try something like Ghost. You'll be able to build your website, newsletters, and even membership programs.
R: Not only are you able to create something and put it out almost immediately, you're also able to monetise directly off these platforms. For a fee, they'll handle all your payments — payments in, and payments out.
So this is one reason why we think this is the Golden Age of media. You're able to move quickly and cheaply, often by using the phone in your pocket — and that means you won't need a ton of cash to start.
You just need to look at the vast YouTuber generation of creators who have built viable businesses, often with no upfront money. They've made the most of this digital age, where everything you need to create, distribute, and amplify content can be done on your phone — without distribution costs.
Think about it — running a newsroom just a few years ago was crazy. News-gathering, processing stories, fact-checking, editing, publishing, distributing, marketing, sales, amplification... all of this was only 15 years ago where if you wanted to share an idea, you'd have to get a printing press, a delivery network of trucks, or a satellite uplink. The cost of entry is the game changer here.
This is hard
A: We're not saying that any of this stuff is easy. It's like putting together an Ikea bed — it's possible, but it doesn't mean it's easy.
Here's a reality check for you: 90 percent of startups fail. The top reason, according to a CB Insights survey, is that they ran out of cash.
And why did they run out of cash? Because of reason two: there was no market need... it was a flawed business model.
There's a finite length of time for you to figure out if this idea of yours — this business — is even viable. That is determined by how much money you have on the table to burn while figuring out how to make a product that makes money.
Here are some ways to think about it.
Building blocks
R: Let's start with something us media folks get a little uncomfortable talking about — and that's BRAND. 'Brand' isn't about what your content looks like. It's not about how it sounds, or how well you write. It's how you make people feel. People tend to feel pretty good when there's a connection.
And the best, most direct way of building a connection with someone is to solve a problem. Their problem.
Your brand reflects your values. And values are a big deal, according to Daniel Marchette at Southeast Asia Globe in Cambodia.
“Branding isn't your logo or your website. It is the principles, values, and standards that permeate throughout your organisation. It's important to stay on brand because it's important to stay true to yourself. People can tell when you're being disingenuous, people who resonate with your brand are possible subscribers.”
You have one job as an entrepreneur: Solve the need of a customer. And in doing so, help them live better lives. Help them make better decisions. Help them be better.
Just a quick note here: through these lessons on School of Splice, we'll use words to describe the people who use the content you produce in a number of different ways: user, community, audience, listener, viewer, reader, customer... you get the idea. It doesn't really matter what you call them as long as you remember that almost everything you do is in service to these people. Get to know them well.
Optimise for solving the problems of your user, and the money will follow.
A: This is the first principle at the School of Splice.
You'll hear this reiterated over and over again — that the best way to build a viable media company today is to focus on solving specific problems for your customer. Everything else is just noise.
So in that sense, the business is simple: You get paid to solve problems. Now that's not something you hear much about in the news business. But if you can get that right, you're already on your way to building something that people want — and will probably pay for.
Focus on the value that you're creating in that relationship with your audience. Just think about where media has been in the past five decades.
Traditional media that we grew up with was all about creating value that advertisers paid for. They paid media companies money so that their ads got to you. That's value.... for the advertiser. For your users? Nobody really knew. And all that has changed.
Your value proposition IS the business, as Dulamkhorloo (Duuya) Baatar describes it.
"My name is Duuya and I'm currently serving as the CEO of the Nest Center for Journalism Innovation in Mongolia...
Speaking from my own experience, I would say that not knowing the value you are creating is the biggest mistake. If you have a value proposition that you are certain is important be confident and don't underestimate the impact you can have."
R: So that's the first thing — solve a problem. Solving a problem for your user makes you valuable to your user, and that's where you begin. With value.
But value isn't generic — it's a very specific thing. So if your business plan is to create content for a mass, generic audience, you're going to find it incredibly difficult to articulate that value, because you're not solving a specific problem for a specific user or community.
A: Take a minute now and write the first draft of what would be your mission statement. Answer these two questions:
What does your audience need? Be as specific as possible.
What problem can you solve for them?
Now hit that pause button and write those down.
R: Welcome back.
Now that you've had a chance to imagine what your value proposition and mission could be, let's take it one step further.
We're believers in the process of prototyping. Simply put, this is where you take your hypothesis of value — and put it into something you can test.
We call this a Product — which is any content that you produce that your customer and audience comes in contact with.
A: Now at this point, you have no idea whether your hypothesis could work. You're making assumptions here — that your audience wants this thing from you because it solves a problem. But you won't really know until you something out the door.
Prototyping is the way forward.
As a startup builder, you have two competitors. But it's not a rival organisation. It's two things: money and time — and they're connected, obviously.
You don't want to build something that no one wants — despite your best intentions. The best way to save money is to test as early as possible. Don't throw good money and time away when you're just starting out.
R: That's right, man. The number of times we've had people tell us that they spent their own money, or got a small grant, and then immediately hired a bunch of people and started paying office rent at the get-go because they wanted to do breaking news... and we're like, STOPPPPP!
Seriously, STOOOOOPPPP. We like to say that you should fail fast — which means you want to make your mistakes early rather than late - and fail cheap, which means you probably want to fail with a quickly-produced YouTube video shot on your phone rather than hire a team and a studio for a fancy production that nobody wants.
Save your money
A: You've gotta find the easiest, fastest way to get something out the door. And the best way to do this is to ask your own network of users — pick from your greatest fans or your truest believers. (We have a whole School of Splice lesson about this.)
Building a product they really want means actually building that prototype, asking them to test it, hearing their feedback, and then making changes until it becomes that thing they would actually want to use — something they would spend time with, and hopefully money on.
That's what Nithin Coca of the Asia Undercovered newsletter, learned in his journey as a media founder.
“The most useful advice I'd have for someone starting up in media today is number one, most importantly, don't be afraid to collaborate and share what you're doing from the very beginning. I believe that working in silos and working in secret is one of the biggest problems in too many media outlets and companies today. You can get amazing information, advice, feedback, uh, from your audience, from other people in the media community, from journalists. Uh, but only if you're willing to engage and share and not be scared of someone stealing or someone, uh, copying your product, um, be willing to trust people and be willing to, uh, get their feedback and get their input.”
R: Figure out what would be the minimum product you can build to test your assumptions with the people you're solving for. That's what we call the MVP — the minimum viable product — but don't overthink it. Make decisions and have the humility to correct yourself if you're wrong. Everyone screws up. If you're not, then you're not learning. That's how you know you're moving forward.
Here's Badar Alam from Lok Sujag in Pakistan on how they tested a Punjabi news bulletin on radio with a bunch of potential listeners:
“We wanted to develop a news bulletin for Punjabi listeners in Pakistan, because we thought no such thing existed in the country. Uh, as a result, we developed a prototype and tested it with potential listeners in two mainly Punjabi speaking districts of Sahiwal and Faisalabad, uh, in June, 2021. During this testing phase, most of the respondents that we approached, they like the bulletin as it is.
A few of them also gave us very useful suggestions for changing it. As a result of their feedback, we made a number of changes in the bulletin. For instance, we chartered the duration of it. We also changed its background music to a more defined Punjabi tune. And we also reduced the number of news reports in it so that we could provide analysis and context for each of them.
I believe that as a result of all these changes, the end product is much better and much more solid than it originally was.”
A: We'll have a lot more on how to create a product strategy in the next School of Splice Foundation lesson. So don't worry if you didn't get all of this.
But right now, take five minutes. And write down a list of assumptions.
Here are 3 questions to help with that.
What do you believe your product can do?
What do you need to see to believe that this is actually working to solve a user problem?
What do you need to see to throw out your assumption?
R: So, you mean, something like this? What I believe my product can do could be: It's a financial calculator that helps understand a new national budget, for example.
And for What do I need to see to believe that this is actually working to solve a user problem? I might say that out of 20 people I tested this with, only 1 came back with a problem.
And for question 3, What do you need to see to throw out your assumption? I might say that if more than 40% of the folks I tested the prototype with couldn't figure out how the calculator helped them understand the budget, I would have to quickly switch gears and find something else that solved their problem.
A: That's right. So the three questions again:
What do you believe your product can do?
What do you need to see to believe that this is actually working to solve a user problem?
What do you need to see to throw out your assumption?
Go ahead, hit pause, and put some thoughts together.
A: You'll have noticed by now that despite this being a lesson about media, we haven't talked about content. We're avoiding it for a reason — that many media folks will default to content as a business model.
It's not.
Content serves two functions for you. It's how you get through to your audience. It can also help you start a conversation with a potential audience.
R: Content is a starting point. The mistake that many media organisations make is believing that the article is the only product of a newsroom — the only atom — and they put the majority of their budget toward the production of that content.
So we're going to repeat that for you:
Content is not your business model. It is the raw material that serves to form the connection between you and your audiences.
Content is meant to be a starting point — it's the beginning of a conversation with your user.
This is how Deborah Augustin at New Naratif thinks about content.
When you have a membership model, good content isn't enough. Lots of media companies publish good journalism. With membership, people are looking for a reason to buy in. Maybe it's your values like equitable pay. At New Narrative, people often cite transparency as a reason they signed up as members. But maybe it's how you build community through your events, whatever it is, you have to think beyond content.
A: The packaging of content is format, and that format could be anything: an Instagram Story, a WhatsApp group, a podcast, a live audio room, an article, or a Telegram channel.
Keep in mind that the price at the entrance is zero. That's good and bad. The good bit is that you get to create something quickly — and for very low, almost no, cost. The bad part is that everyone else is doing that, and getting seen, heard, or read is harder than ever before.
Which is where relevance and utility come in. The more relevant your product or business is to your specific community , the better chance you have of being seen, heard, and read.
Which means your business strategy needs to built around relevance and utility.
Success and failure
R: The final section here is about you — the founder. While we're super optimists about the future of media, we also know that most startups fail.
Like we said in the beginning of this lesson, that CB Insights survey said the top two reasons that startups fail are 1. they ran out of cash. And reason 2? There was no market need. So the business model is flawed.
This is a difficult journey, and it's often lonely. That's why your mental health matters. You'll have moments of sheer joy, followed by moments of dread. And in between all of this, moments where you question your choices, your ability to deliver, let alone build a viable media business.
It's important to set the right framing. And here's an important one: Decide very early what success looks like for you. This is different for everyone. Some of you will think of this as being able to make more money than you did in the newsroom.
A: Or to be able to build a remote organisation by default, so that you can live anywhere in the world and still run this.
Some of you will count success in the number of people who read you, or connect with your content.
It's okay for this success objective to be small and achievable. Small wins matter.
Whatever that is, the sooner you decide, the easier — because those doubts will set in — especially if you set yourself a crazy unrealistic success target — and have raised money for this. Crazy moonshots are great, but they happen in smaller stages.
Also, decide what failure looks like. In a way, this one is straightforward: failure could just mean running out of money before you had a chance to make some.
R: You'll also have to decide how much time and money you want to burn on this journey. If you have say, 50 thousand dollars, you'll have to decide when to pull that plug if you haven't figured out a viable business model. Factor in the opportunity costs as well — you could have been making more money with a regular salary at a larger news organisation — or doing something else with that time.
So figure out what exactly it is that you want to get out of this journey — and that takes focus. We asked Dan Oshinsky of Inbox Collective about the mistakes we make as founders:
"The biggest mistake I see media startup founders make in their first year is a lack of focus. There are a lot of opportunities coming your way when it comes to content to growth and monetisation. But in year one, try to maintain a focus on your core strengths. Then you can chase down some of those other opportunities in year two and beyond."
Have very clear milestones for yourself — time and money don't last forever. So know what to look for.
A: Finally, surround yourself with the right people. Find people who share the same optimism as you because you'll need that energy.
There are plenty of well-intentioned friends and family who will ask you about the business every time they see you. Often this is good, but it can also be draining to explain how you're still figuring out a viable business.
Be around people who are there to challenge you — and champion you.
Our friend and feminist podcaster Nandar has advice for you around not waiting for permission to do something that you and your community strongly believe in:
The suggestion I have for someone who is trying to start something in media company would be don't wait for anyone's approval or validation to do what you see the value in doing. Do it, and the support you need will come along gradually trust me on this because I've done the same way.
Your energy, like money, is limited, so spend it wisely.
When in doubt — and trust us, you will doubt yourself! — go back to your first principles around why you're doing what you do. And most important, go back to your community and the problem you're solving for them.
R: We've been there ourselves, plenty of times. All the best!
We hope you found this useful.
Go check out the other lessons from this foundation course.
If you have questions, send us an email here, and we'll get right back to you.