A Trend to Watch: HubSpot Acquires The Hustle

by Alex Ford

HubSpot announced this week that they are acquiring The Hustle for what Axios has reported to be $27 million. The Hustle is a 1.5 million reader strong e-newsletter business targeting entrepreneurs and business owners. In commenting on the acquisition, HubSpot highlighted the overlap between The Hustle’s readership and parallels with the resources and audience that HubSpot has been building on its blog as well as the overall fit with its customer base.

Anyone who has considered HubSpot is likely well aware of the amount of best practice content they offer their customers and prospects. Adding an engaged audience of potential HubSpot customers and a distribution channel for that content makes tactical sense.

So why does this matter beyond what seems like a smart – albeit expensive – marketing play? I’ve long been a proponent of pairing Software as a Service (SaaS) businesses with content. And it’s a trend to watch as SaaS businesses become more sophisticated in their customer acquisition and deepen their value proposition beyond simply offering a software toolset.

Combining SaaS and content means including content as an essential part of a software product or by adding digital media communities or conferences to the front end of a SaaS business model. It was a major factor in the acquisition of the company I founded – Praetorian Digital – and its merger with Lexipol in the public safety learning and compliance space. In this case, The Hustle offers HubSpot content, a conference footprint and a fledging subscription data product.

For SaaS Businesses

If you follow SaaS businesses or have operated one, you know that the beauty of a SaaS business is in its clear metrics such as such as LTV/CAC (ratio of lifetime customer value to customer acquisition cost), payback period, and net churn that supports rapid scaling. Done right, adding digital media decreases CAC by creating an ongoing channel to a captured audience to which you can market your solution and builds brand authority and thought leadership. It provides a warm list for your lead or sales development reps to call and allows you to map lead capture to relevant articles even gating content that closely correlates with purchase intent.

More importantly, it also allows you to map content to all stages of the customer lifecycle, which  improves core metrics like usage and net churn. Taking this one step further, content paired with a SaaS platform presents opportunities for new product features or add-ons. For HubSpot, this could be a premium subscription for customers either at an additional cost or as a value-add to support annual price increases. Learning management system businesses have long applied this strategy by offering course content along with their platform and authoring tools. Finally, the data from content engagement can create intriguing opportunities to pair software usage data with industry trends. In this case, the Hustle already offers a data product – Trends – that will only grow in value within the HubSpot ecosystem.

For Digital Media Operators

Digital media has largely been struggling to find its way over the past several years to compete with social media and the rapid changes in content consumption. For digital media businesses in or around verticals where workflow tools are important, there are important implications. SaaS businesses, who may be some of your larger customers, could be future acquirers or could begin to compete as they build their own blogs and newsletter lists. Think differently about the SaaS businesses you have as customers and look for partnerships and deeper relationships to test the waters.

Alternatively, digital media businesses are in a unique position to swim upstream and add SaaS or workflow solutions to their offerings as I did at Praetorian Digital when we built an enterprise learning platform for first responders to extend our digital media communities. That effort ended up generating nearly half of our annual revenue. Doing so is a heavy lift and requires a major shift in culture and different skillset but is well worth the effort when comparing relative valuations and the opportunity to embed your business within your audience. And with software becoming easier to build and manage, the deep domain experience, engaged potential customer base, brand trust and content resident in any digital media or traditional media business presents a set of competitive advantages that will only become more important as we’re seeing here with HubSpot.

 

Alex Ford is an accomplished entrepreneur, angel investor, public speaker and executive. He served as Chief Executive Officer of Lexipol in 2019 and 2020 following the merger of Lexipol and Praetorian Digital, which he founded in 1999. Alex led the company to become the leading learning and content platform for first responders and local government leaders, driving 15+ years of profitability and more than 15% growth per year. Currently, he is operating partner at North Equity and strategy advisor to multiple companies.
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‘It Just Kind of Built on Itself’; 8 Ideas for Varying Your Content

“We wrote a story about a company that was making its employees come in when they were sick until they were proven to have COVID-19. It’s a $1 billion company and we were telling the story about it. We wrote about another company that went into bankruptcy and their truckers were calling into our XM radio show talking about how their cards were being cut off. Those are the things people care about.”
That’s from Craig Fuller, founder and CEO of FreightWaves, a member of our Connectiv division, in an interview with my colleague Matt Kinsman. The bankruptcy story, about the collapse of Celadon, earned FreightWaves a 2020 Jesse H. Neal Award for Best News Coverage. FreightWaves.com also won best website for its revenue category.
It’s great to see that a company like FreightWaves, which had no origins in media, now puts such importance on content. “As we started to go to market, we realized that every successful futures market has an ecosystem of news and data and that didn’t exist with freight logistics,” said Fuller. “FreightWaves was started to evangelize and inform how futures work but we also knew that if it was just about trucking futures, no one would read it. We started writing about things like Tesla, Amazon, hurricanes… and it just kind of built on itself.”
Here are 8 more ways to put good content out there:
1. Increase your emails.
The new Reuters Digital News Report said that the email daily update now accounts for 60% of all news emails and it is generally well-received by both news lovers as well as daily briefers. The reasons that this is such a popular product are: simplicity, finish-ability, curation and serendipity. Globally, close to half (44%) of all respondents say they do read most of their news emails.
2. Video is still killing it, especially if you have international aspirations.
While 67% of those polled by Reuters say they access online news video on a weekly basis, in some countries that number goes as high as 95%. So it’s a good idea to increase your video output. “Across countries, over half (52%) access video news via a third-party platform each week, such as YouTube, Facebook and Twitter, with a third (33%) accessing via news websites and apps.”
3. Podcasts rising.
From the report: “The underlying [podcast] picture remains one of growth. Our data show an overall rise in podcast listening to 31% (+3) across a basket of 20 countries [including] the U.S. (36%). Podcasts can be five minutes or 50 minutes and in a variety of formats, so they’re relatively easy to start—even now—and people are listening more.
4. Use emotion in your copy.
“Emotional connections happen because we’re human, and we’re built for these connections, wired for them, and rely on them to live a rich, meaningful life,” said the famous “Marketoonist” Tom Fishburne. “Despite our significant advances in science and technology, human emotion (mainly our subconscious) will always be core to our DNA.”
5. Start a weekly content feature that brings people back.
Inc. launched a weekly webinar called “Real Talk.” “It’s people who have had success and are willing to give back to entrepreneurs and the small business community and answer questions for an hour,” said Scott Omelianuk, editor-in-chief. Haymarket’s PRWeek has two that they’ve started during the pandemic: Lockdown Life and Coffee Break.
6. Get your community “together” to talk content.
One of our other divisions, AM&P, is hosting virtual get-togethers on Fridays at lunchtime to either talk about a topic—diversity, alternative revenue, accessibility—or just offer each other support. Joanne Persico, president of SIPA member ONEcount, has been holding “Bold Minds Virtual Mixers” every Wednesday at 5:30 pm.
7. Experiment now.
By seeing what sticks now, you’re adding to your future. “When we come back [to live events], virtual elements will still be a big part going forward,” said Steve Barrett, VP and editorial director for Haymarket Media’s PRWeek. “We’ll still do virtual stuff because we’ve seen the potential of it. In terms of the bigger events, you have to add value in different ways than you would for a physical event… We’re all learning, there’s no playbook.”
8. Mix live and recorded content.
Barrett acknowledges that “pre-shot” content is often a safer way to go for awards and webinars. But he prefers a mix. “I think [people] do like seeing more personality” that comes from live content, he said. “All pre-recrorded can come off as a bit dry. And we’re all learning. I do think virtual events will progress massively over the next 12 months.” Jared Waters of BVR also recommends a mix of live and pre-recorded content, emphasizing that speakers often have a preference that should be respected.
Business network concept. Group of businessperson. AI (Artificial Intelligence).

‘The Core Job of Journalists Isn’t Going Away’ – ALM’s New AI Content Tool Shows Human Plus Machine is the Way Forward

Last month, legal publisher ALM introduced Legal Radar, a “first-of-its-kind website and app” that uses artificial intelligence and natural language generation to offer faster and more personalized user experiences.

Legal Radar puts the reader in charge, allowing users to select the news they would like to see from a list of relevant industries, practice areas, law firms, companies, and geographic regions, then scrapes information from federal case database PACER to generate automated summaries (usually between 50-80 words) of key details about cases as well as pulling in original ALM content from other channels.

“The newsfeed is filled with short, easy-to-digest news briefs that are intended to be scanned, kind of like the experience you would have on a social media app like Twitter or a news app like Flipboard,” says Vanessa Blum,  head of newsroom innovation for ALM’s Global Newsroom. “It’s a very mobile friendly experience and responds to that habit we know our users have which is responding to short news snippets while they are on the go.”

Legal Radar represents a significant shift in the way that content is both generated and consumed. Connectiv spoke with Blum about the realities of building an AI-driven content product, how the customer content experience is changing in B2B media and what the rise of AI really means for editors and journalists.

Connectiv: Vanessa, how does the AI component of Legal Radar work?

Vanessa Blum: We start with a stream of raw data from the federal court system via PACER (Public Access to Court Electronic Records). We apply some data processing on the back end in order to normalize, structure and clean up that data.  Then it’s converted into short summaries using natural language generation (NLG) technology from a platform called Automated Insights.

It goes in as structured data and it comes out as a readable summary. Then, as the final step, we have editors review the summary for accuracy and to make any edits that are necessary.

Connectiv: The release refers to a “first-of-a-kind website and app.” Can you talk more about what makes this first of a kind and how this offers a new customer experience?

Blum: I’ll talk about two things. First is that user experience. There’s never been a legal news product, certainly not a free legal news product, that is so easy to use on mobile, that can be personalized by user selection and is so seamless to digest information and respond to it. We think we nailed that UX in a way that hasn’t been done in legal media

The second part, which we are really excited about, is the way we are using technology and data processing to generate content for Legal Radar. It’s not the tech in itself, it’s that using technology allows us to be exponentially faster in delivering news to readers and also to deliver news across a wide array of topics and interest areas. I’m really excited about what the technology allows us to do, not only the tech in itself.

Connectiv: Talk about the interaction of the technology with editors. What’s this mean for an editor day-to-day?

Blum: I’ll start with the development process, and how closely our editors and developers worked together in building the back-end system. There are journalistic insights baked into every piece of the data processing engine—it’s the editors who devised how this data should be handled as well as the categories and the tagging that should be applied to it.

And then at the NLG level, these are templates that were created by editors to produce the kind of output that would be useful to readers. They account for over a dozen different fact patterns. It’s not a simple plug-and-play NLG engine, there is really this contribution of journalists and editors throughout the development of Legal Radar. Now that it’s up and running, we have editorial review of every item that’s created. We have staffing around the clock where an editor is looking over each and every item.

We thought that was necessary for two reasons—one is that the data set we are working with can be messy. We knew we needed something on the back end to protect against an error in the data producing an error in the content.

The other component is the ability of a human to enrich the content that we are putting out. These are very short, very fast-paced summaries but if something catches an editor’s interest, they will take an extra step—they will open a case, they will open a lawsuit and add a few key facts. We think it’s incredibly valuable to have the human judgment at the end of that process to resolve any questions or enrich what we are producing using the automated system.

Connectiv: A lot of publishers are taking a look at AI and trying to understand what they can do. As someone who’s successfully built an AI tool, what takeaways ca you share about working with AI and building and AI-driven product?

Blum: I have two main takeaways from this experience: first is to focus on the end user and not the tech. It’s easy to get enraptured by cool tech but the best practice is focus first on what you want to deliver and then focus on how the tool gets you to that result. In my role, learning about new tech and seeing how other companies are applying it is eye opening and can spark that creative process but it’s essential to stay user-focused.

The second thing is to build truly cross-functional teams. Creating Legal Radar required journalists, programmers, product designers and business strategists to all be around the table in a way that was really new for our organization. We tend to have content creators in one area and developers in another. For Legal Radar, content creation and technology are so intertwined that we had to break down the walls and get editors and programmers talking together to solve problems. Not only has that made our product better, it’s made our company better.

Connectiv: What was the biggest strategic takeaway from this experience?

Blum: Staying open minded. When we first started, we had a different data set in mind that we thought we’d be using to produce automated coverage. We learned early on that data set wasn’t workable for us, we had to pivot to something else.

One other thing that I’ll mention, we are working with Automated Insights and it’s a great product, but we found we had to build a lot of solutions at the front end before the data is fed into Automated Insights and at the back end before the content goes into the Legal Radar newsfeed. That’s not something we necessarily anticipated at the outset—how much thought and creativity we’d have to apply both to the data feed going into Automated Insights and how we would handle the content on the back-end.

Connectiv: As the head of newsroom innovation, what are you excited about with content and media? And conversely, what do you think is overrated?

Blum: I’m interested and excited in the combination of human and machine intelligence. I love watching how other news organizations are using technology, using algorithmic journalism, using AI and combining it with the expertise of their journalists to come up with solutions that are incredibly rich. That’s kind of the secret sauce in my view.

In terms of what I think is overhyped, I hate answering that because I’m sure I’ll be back talking about this a year from now, but I will say that smart speakers and developing news products for Alexa. I don’t get that one yet. I’m not convinced we’ll be receiving our information from smart speakers in the near future.

Connectiv: You’ve talked about journalists and AI working together. What’s your reaction to the idea of AI replacing editors and writers?

Blum: That’s the natural fear that people in our industry have as we begin learning about automated journalism. The more I’ve learned about it, the less that fear seems grounded. What technology is capable of is so different from what humans are capable of that it’s really through combining the two that we will see the most exciting advances. Technology is great at processing reams of data very fast, but in the business I’m in, which involves asking questions, exploring trends, talking to insiders, there’s no potential at this point that a machine will take over those functions.

When you combine the speed and data processing capabilities of the technology and turn that over to a human being to do the investigation and talk to real people, that’s where magic happens. I think journalist jobs will change–my own changed dramatically–and journalists will be forced to become more tech-savvy and be more open to using data processing in their work, but the core job of a journalist isn’t going away and cannot be replaced by a computer or an algorithm.