Jason Calacanis wants to build the next media empire on the back of an old standby: email, specifically email newsletters.
On Monday, Calacanis launched a site called Inside.com, which functions as a Kickstarter-style system for identifying topics ripe for their own recurring “top news of the day” email newsletter. Topics that snag 1,000 sign-ups will see their own newsletters produced by Calacanis’ team.
The building blocks of the newsletters will be two or three sentence summaries of stories from major publications, and links out to those stories.
“We are going to launch 250 of these [newsletters],” Calacanis tells Business Insider. His current “beta” roster includes eight newsletters, which range from “Inside San Francisco” to “Inside Electric Vehicles.” Collectively they have built a collective audience of over 100,000 over the past eight months, he says.
The problem with news apps
Calacanis is the active angel investor and serial entrepreneur who sold Weblogs to AOL for $30 million in 2005. But it was a frustrating moment in his career that led him to Inside.com, not one of his successes.
“We tried to make a news app,” he explains. “It would be the Uber or Twitter of news … Everyone agreed with that premise. There was a whole cohort [of startups] that were invested in to do that … And they have all failed pretty hard.” Calacanis ascribes this failure to two thing: app-building is expensive from a technical perspective, and getting a news app into people’s daily workflows is extremely hard.
“Half a million people downloaded the app, and about half gave their email,” he recounts. “Only one per cent of them used the app every day.”
So Calacanis started an experiment. His team would email the top 10 stories of the day to the email addresses they had gotten. They saw 40% usage versus less than 1% on the app. “40x the return,” he says. “And it cost 90% less. We didn’t need any of the developers.”
The audience relationship
Calacanis isn’t the only one to discover the power of a lean email newsletter operation. For instance, the “morning briefing” cult hit TheSkimm, which launched in 2012, had grown to over 3.5 million subscribers as of April.
But Calacanis is banking on a relationship with his audience to drive Inside.com to success.
The first piece of that relationship is letting the audience pick the newsletters that get made through the Kickstarter-inspired system.
The second is the ability for readers to “reply” to any of the newsletters and have their emails be read by the team.
“We are actually spending about a third of our time encouraging people to reply and then interacting with them,” he says. “If I reply, somebody will actually get back to me. That really changed everything.”
Readers are correcting the newsletters, correcting the source material, and participating in an ongoing discussion about whether the newsletters are too left-leaning. “Are we treating Hillary with kid gloves?” Calacanis asks. And he says this relationship will continue to evolve.
This intimate reader relationship is also what Calacanis says will help his team lean away from “linkbait.”
“People who sign up for the email are opting into curation,” he says.
These readers aren’t just seeing a headline pass them by on social media, so there’s not the necessity for a big hook to get them interested. Instead, the content of the email is focused on a succinct summary of each story. “It’s an executive summary [of the news] in the vertical or verticals that you care about,” he says. Even if readers don’t click through to all of the articles, Calacanis wants his readers to walk away informed.
And he’s not worried about publications feeling he is stealing the meat of their stories. “If you are fair to people, they will respect ‘fair use.’ If you are unfair, people will sue you and write letters,” he says.
The money question
As to money, Calacanis sees revenue coming from both ads and patronage. “1-5% of people who consume media want to support it,” he says.
But the big key to success will be keeping costs down, Calacanis says. “There’s no infrastructure, no printing press, no fancy office, no big level of mid-management. There’s two or three writers working on a vertical, and they can hit publish.
“We think this is the key to scaling it,” he says.