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The rise of ALLCITY

Discussion in 'Journalism topics only' started by MeanGreenATO, Apr 29, 2024.

Page 2 of 2
  1. The Big Ragu

    The Big Ragu Moderator Staff Member

    Major player may be overstating their impact or viability a bit.

    It's still small, it is living off of capital raises (which are very small compared to what the Athletic was able to raise, but the Athletic was active during a frenzy compared to where we are today), and it is trying to establish the kind of business -- a content provider that sells advertising -- that has left a graveyard of others in its wake.

    It actually sounds a whole lot like the stuff that used to come from the guys at the Athletic for years before they sold to the NYT. The emphasis on it being cash flow positive . ... which I'm not saying is a bad thing; you don't need to raise more and more capital to blow through to keep from having to shut your doors when you generate cash. But there is a difference between struggling to get by with a relatively small company, and earning money, let alone earning money at much larger scale.

    Even if it can be a viable, profitable company, the other question is whether it can ever be big enough to justify the kind of valuation people are buying ownership at right now. There is a chance, at least, that is is just like the Athletic, which basically used its ability to get people to buy equity at higher and higher valuations during a bubble, and then grew aggressively rather than proving the concept along the way with cash it generated through operations. At its worst, it could be like a tiny sports-focused version of Buzzfeed or Vice, which were complete shit shows, although in the current environment that isn't possible, because money isn't being thrown around as speculatively as it was when Buzzfeed and Vice were living large on other people's checkbooks.

    The Athletic raisedcapital at insane valuations in a zero interest rate environment, and got bailed out right as that was ending (albeit at a lower payday than they would have gotten a half year earlier), by getting the NYT to pay an amount for it that it surely regrets now, because whatever plan they had to squeeze out costs still has them sitting on something that loses money.

    My question with this company would be, 1) Will they be able to keep raising capital the way the Athletic did? It's a much tougher environment at the moment (higher interest rates have tamped down on some of the malinvestment), but maybe that changes soon. 2) If they do grow aggressively using other people's money, will there be a NYT (or a public offering) that allows them to cash out? 3) And most importantly. ... is another content provider selling advertising really going to fare any better than others usually do? What happens if we have a recession or advertisers scale back while they need to sell more equity using that model?
     
    Last edited: Aug 20, 2024
    The Big Ragu, Aug 20, 2024
    #13
  2. justgladtobehere

    justgladtobehere Well-Known Member

    ESPN tried to cover every market and it didn't work. The Athletic already hired the best. Podcasts? It is 2024. The gold rush is over. Seems like an idea that would have been great 15 years ago.

    Also, do local podcasts do well compared to sports radio?
     
    justgladtobehere, Aug 20, 2024
    #14
  3. SixToe

    SixToe Well-Known Member

    I haven't figured out the difference in sports/other talk on radio and talk talk on a podcast with a good host or hosts.

    Sports talk radio -- broadcast everywhere, advertising, often a quite verbose host (STFU sometimes!), and guests or callers

    Podcast -- broadcast everywhere (possibly more than a radio station signal), advertising (maybe), verbose host (or the show is boring), and guests

    I'd guess that perhaps a really good local podcast might do better than sports talk radio, thanks to more time to devote to the local aspect. And maybe not a loud, "I'm going to give my long, rambling view "question" and ask if you agree" host. The bottom line for either is monetization, right? Ratings and money, as always?


    But, fortunately, I don't spend much time listening to either. Better things to do. XM provides a few possibilities while driving, but I never listen to podcasts. I'd rather have music or silence.
     
    SixToe, Aug 21, 2024
    #15
    Liut likes this.
  4. maumann

    maumann Well-Known Member

    I won't say every startup -- but most of the startups with which I've been associated -- has an ultimate goal of being bought out by some larger entity that maximizes the return for the original investors. ESPN is probably the original blueprint in the sports content sector.

    The most difficult thing is to not wind up with an excessive burn rate -- or time the market correctly -- before the big money finally shows up. I don't remember how close ESPN came to shutting down before Getty pumped enough money into the network before it started to make a profit.

    Bleacher Report is a perfect example of hitting the lottery. Turner Broadcasting was flush with cash and didn't want to create its own online presence (despite having a massive amount of in-house experience with NBA.com, NASCAR.com, PGA.com and NCAA.com staff). Those guys in San Francisco who started B-R got filthy rich at the expense of all the volunteer writers and editors who never got a dime for creating content.

    On the other hand, TotalSports.com was burning $5 million a month despite an ahead-of-the-curve model that was beating the pants off Go.ESPN.com and giving SportsLine stiff competition. We were running Golf.com, Beer.com, the L.A. Times and Wall Street Journal sports pages, plus a large number of university sites, and NCAA's major championships including Final Four.

    NBC was a really good partner and TotalCasts in 2000 were extremely sophisticated for their time, and honestly I think better than what MLB does with its game coverage now, with the exception of the graphics and Statcast. My 1,000 shares were worth nothing but the fun we had trying to make it work for 18 months.

    What killed TotalSports was the timing of the public stock offering. The market imploded two weeks before we were to go public. Quokka bought what was left but by that time, they were hemmorhaging money as well. And it all went poof. CBS barely rescued Sportsline in time and ESPN lost money on the .com for several years until after the market recovered.

    Otherwise, we'd all have been toast.

    I'm guessing ALLCITY would love to be sucessful enough to find a suitor to cover their original costs and then some. If people enjoy the content, that's an extra benefit.
     
    Last edited: Aug 21, 2024
    maumann, Aug 21, 2024
    #16
    Liut likes this.
  5. Twirling Time

    Twirling Time Well-Known Member

    The loading docks at Home Depot are chock-full of 54-year-old forklift drivers who were 30-year-old millionaires in 2000.
     
    Twirling Time, Aug 23, 2024
    #17
    Ice9, maumann and 2muchcoffeeman like this.
  6. goalmouth

    goalmouth Well-Known Member

    Entrepreneurs risk everything, and most ventures fail.

    Is luck, as Branch Rickey famously said, really the residue of design? My grandfather and his brothers in the Twenties built Sonatron, a successful radio tube business. They sold it to RCA and got out of the market in September 1929...
     
    goalmouth, Aug 25, 2024
    #18
    justgladtobehere and maumann like this.
  7. Della9250

    Della9250 Well-Known Member

    The Dallas group started today, and now we know why the star telegram needs a cowboys writer
     
    Della9250, Aug 26, 2024
    #19
  8. The Big Ragu

    The Big Ragu Moderator Staff Member

    Lucky people invariably put themselves into positions where they could be lucky.
     
    The Big Ragu, Aug 26, 2024
    #20
    maumann, gingerbread and BurnsWhenIPee like this.
  9. Patchen

    Patchen Well-Known Member

    Good luck. There seems to be a lot of evidence it is tough to make money on sports coverage of this type over the long haul.
     
    Patchen, Aug 26, 2024
    #21
    TigerVols and maumann like this.
  10. MileHigh

    MileHigh Moderator Staff Member

    A paywalled story posted yesterday interviewed the AllCity CEO. Says the $12 million in funding came from Tegna. And the markets they launch in the next two years will be Tegna markets. Can't upload a PDF and a little skittish to copy and paste the whole thing, but PM me if you want more details.

    DNVR parent company raises $12M as it expands to fifth city
     
    MileHigh, Aug 30, 2024
    #22
  11. MeanGreenATO

    MeanGreenATO Well-Known Member

    TEGNA has really made a push toward that type of content. In Cleveland, they have a daily broadcast called the Ultimate Cleveland Sports Show that features former ESPN anchor Jay Crawford. I've been impressed each time I've been involved with it and I believe it does very well. Very smart play by TEGNA.
     
    MeanGreenATO, Aug 30, 2024
    #23
    TigerVols likes this.
  12. Neutral Corner

    Neutral Corner Well-Known Member

    I think national podcasts and local sports radio. Local podcast has a helluva hill to climb.
     
    Neutral Corner, Sep 7, 2024
    #24
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