Did the broken capital chain lead to the closure of technology media Gigaom?

The famous technology blog Gigaom suddenly announced its closure. However, from the outside, the website was operating very successfully: Gigaom had more than 6 million regular readers per month; more than 70 senior network maintenance employees and its own research platform. Just last year, its founder Om Malik just announced that Gigaom invested $8 million to cope with the growing business. However, the reason for Gigaom's closure is still unclear. Some people speculate that the shortage of funds after the investment and the eagerness to expand the business scope and the neglect of the actual situation accelerated Gigaom's "death".

The following is an interview with Mathew Ingram, the chief writer who joined Gigaom in 2010:

Q : Before this Monday, were there any signs that the website was going to close?

A : Not at all.

Q : Are you completely unaware of this?

A : Yes, and I think most of the employees in the company are the same. We were still working hard at the moment when the website was announced to be closed. We just replaced the new CEO (Michael Rolnick) some time ago. Therefore, the company needs some changes, especially strategic changes, but the company has not taken any action, and there was no discussion of countermeasures before the announcement. We were even informed of the company's closure and all employees' unemployment by phone on Monday afternoon.

Q : Everyone was shocked by the Gigaom closure.

A : Me too. I think everyone should know that Gigaom is in a serious financial crisis, but this is normal. Moreover, we have just welcomed a new leader. When he took office, he said that his goal was to make Gigaom's business stronger. Although there will be some difficulties and challenges ahead, he did not make me feel that the company is on the verge of "destruction".

Q : Gigaom was previously successful. What lessons should other media learn from its current failure?

A : Everyone has their own perspective. Danny Sullivan of Search Engine Land has a lesson for venture-funded media companies. Gigaom is different from other media companies because it has relied on venture capital from the beginning. In a way, venture capital is like golden handcuffs. It's a Faustian bargain. If you don't achieve the development goals you set for your company, investors will lose interest, and without funding, your company will go bankrupt.

Q : You just said that Danny Sullivan thinks this is the result of using venture capital, which allows you to reach more readers faster than other media, but sometimes too fast. What do you think of Sullivan's statement?

A : Danny and others chose to develop slowly with the funds on hand. This is undoubtedly a stable and safe development and operation model, but the only problem is that this model is time-consuming and limits the scale of development.

You may ask, why don't people use the money they have to create a small, independent business and grow slowly and steadily? Isn't that good? But some people don't think so. They also have ambitions to pursue big things. In order to expand your business, you basically have to borrow money to spend tomorrow's money. You have to draw a blueprint for the future and convince others to invest in your project. You can sneer at this ambition, but this is how the world works.

I do think Gigaom is in this awkward position. We are not a niche media, but we have the same vision as them. Will Oremus mentioned this in his blog post on Slate - we focus on less sexy areas, such as environmental technology, the Internet of Things, network cloud hardware, etc. We have a very professional level in these areas, but these areas will not attract a large number of readers. So in a way, we are too small to succeed like BuzzFeed, Vox or Vice, but on the other hand, we are too big to be the company that Danny Sullivan said. So we are in the middle.

Q : You mentioned that one of the downsides of digital media is that there are so many similar sites out there that are trying to expand their business and reach. Isn't it a bit contradictory that Gigaom hasn't done that?

A : It’s a barbell effect: If you are small, focused, and have a monopoly in a field, you may succeed; or if you are large, involved in a wide range of areas and growing rapidly, you may also succeed. But if the situation is in between, it is easy to face failure. There is no doubt that we are in such a “valley of death.”

Three or four years ago, our monthly page views were still 6 or 7 million, which was an amazing number. At that time, we were the market leader. But now many websites have 50 million page views per month, which is something we cannot achieve now.

Three or four years ago, our website traffic was still amazing, reaching 6 or 7 million per month. At that time, we were the market leader. But now, some websites have tens of millions of traffic. We have never reached that level.

We see editorial, investigative reporting and offline events as a virtuous circle, which complement and promote each other. Investigative reporting and offline events are our way to profit from readers, and editorial is a way to attract readers. I think the problem is not editorial editing, but the income from investigative reporting and offline events is lower than the target, making Gigaom unable to maintain operations.

I still believe in the feasibility of this model, even though the scale of this approach is not consistent with our financing method.

Q : What work have you done at Gigaom that you’re proud of?

A : I am most proud of being part of the team that built Gigaom. When I joined the company, there were only 12 employees and only a handful of contributors. When the company closed, there were 22 editors. I think the thing that makes me most proud is that I was able to be part of the creation, change and development of the company. Although the company eventually failed, I still feel that we did something useful and meaningful, even if it was short-lived.

I think what we do best and what makes us unique is that we can pick up stories and comment on them, put them into context, and make judgments about their significance.

Q : What are your future plans?

A : After the company closed down, many people approached me and offered me new job opportunities. I interviewed for some new positions before the company closed down. Of course, this was just a coincidence. I didn’t foresee the end of this job. I am currently struggling with whether to return to traditional media or continue with similar work now.

Q : Do you have a preference? I think you would be interested in a job that allows you to know everything about the company like an expert!

A : You could say that if I were really an expert in this field, I would have seen what was happening. But yes, I am still very interested in the media and its development. We are just in the second round and it is still a long way from the end!

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.