The Memo proves investors still like media startups, landing six-digit funding
London-based media startup The Memo has landed a new round of funding for international expansion, proving investor appetite for media despite the well-documented struggles of established print media.
The more than quarter of a million pounds in cash comes as the 18-month-old online tech publication turned a profit for the first time.
Investors ploughing in £280,000 include the former digital chief of the Daily Mail, Paul Field and angel investor and former Goldman Sachs vice president Andrew Dixon, along with other individual investors.
The five-strong editorial team led by founder and editor in chief Alex Wood will expand, initially with the hiring of two writers based in New York, where it has its largest audience and plans to scale up and commercialise it in a year’s time. But, Wood also has ambitions to expand to other cities around the world where he says audiences want The Memo’s take on technology – “taking something complicated and explaining to people why it matters to them”.
The startup, based at the home of Telefonica’s accelerator Wayra in central London, started raising new funds before Brexit.
“Brexit was obviously a spooky experience both in terms of being a business and for investors we were speaking to at the time, but actually that, coupled with Trump has been quite an interesting opportunity I think for a lot of the media,” said Wood, who cites Monocle magazine and the US startup Skimm as successful media brands.
“You look at a lot of the media, for instance the FT and The Times, they’ve both reported significant growth in subscribers and I think that’s because people are actually realising that the whole echo chamber and bubble problems around social media, more than ever before, people actually need solid information, and I think there really is a gap in the market for more progressive, liberally-minded business media at a time when we’re getting a lot of media hysteria and misinformation.”
The site has passed the half million users per month milestone without spending on marketing, attracting advertisers such as EY and AOL’s TechCrunch, as well as other brands who work with The Memo’s content agency arm.
“We want to capture that market in New York, in Singapore, in Hong Kong, and more cities” said Wood, where its audience of “professionals with curiosity about the future” are. It will hire freelancers in south east Asia towards the end of next year.
Video is its most profitable thing to date and will also be a greater focus for the firm in 2017 as it works towards its goals of reaching 2.5m monthly users by 2019.
Wood also revealed that the eventual plan for the firm would be to sell, remaining independent but within a larger stable and has already had approaches from big media groups interested in both investing in the latest round and an eventual acquisition.
“That’s the kind of direction I want to take this in. A really different publication that belongs in a bigger group,” said Wood.
He cites The Memo’s focus on a core audience and on quality over quantity – limiting itself to five stories per day – as an attractive proposition to investors and “softer” impacts other than page views such as feedback from companies which have been featured.
“Alex is an experienced entrepreneur and has a proven track record in leading online publications to success,” said Field, who was part of the launch team of MailOnline.
“This experience, coupled with The Memo’s excellent team and a revenue model with a clear path to self-sufficiency, gives me confidence that the business will continue to grow and cut through the noise online with a distinctive and compelling voice.”
This article appeared on the City A.M. website on 12 December 2016.
Temple Bright partner Ben Gisbey advised on The Memo’s funding round.