#SFSNYC: Patch has Grown Up ‘Enormously,’ Says Webster | Street Fight

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#SFSNYC: Patch has Grown Up ‘Enormously,’ Says Webster

12 Comments 16 January 2013 by

SW_20130115_NY_5553In a fireside chat with Forbes‘ Jeff Bercovici at the Street Fight Summit on Tuesday, Patch’s co-founder and president, Warren Webster, defended his closely watched hyperlocal network, denying reports that the AOL property was struggling to sustain its rapid growth.

“We merged 25 sites where communities were so intertwined” that it didn’t make sense to have more than one representing a location, said Webster, in response to rumors that the company was consolidating markets. “We’ve hired over 300 people in 2012; that is not a company that is downsizing.” It’s evidence, Webster said, that the company is maturing. “We’ve grown up as a company enormously,” he explained.

For one thing, he said, there’s far less top-down decision-making from Patch headquarters in New York City. “Those decisions are made by people who live in those places, more empowered management teams in each regions,” who have the agency to make hiring and content decisions. according to Webster. Some of those decisions do involve cuts — but to improve service to the market, he said, not to reduce it.

SW_20130115_NY_5564

And even when taking into consideration the 25 Patch sites now stitched onto others, there were 863 sites in all by the end of 2012, and the total number now stands at 903. Patch had 13.1 million unique visitors last year, according to comScore; this represented a more than 30% increase from 2011. Revenue is good; it’s been doubled since 2011. Bloggers (there are some 50,000 of them) he said, are happy. Editors have full-time jobs and benefits. Recent C-suite hires are pleasing staff and parent company AOL.

On the monetization front, Webster continued to stress that scaling local takes time. “We corral hundreds of salespeople in communities,” said Webster. “It takes time to win the hearts and minds — not only of the users, the residents of these communities, but small business owners” as well.

Turning that corner can’t come soon enough for Patch as it looks to fulfill its promise to see run-rate profitability by the end of 2013. Webster said that 100 of the sites are profitable to date, and expressed confident hope that the rest of them would be profitable by the end of 2013. “Putting up [Patch] against any of the [media companies of scale], like CNN or USA Today, I would put that ramp and that time period against any of those companies.”

Besides more growth, completing the profitability portfolio, and with any luck employing still more of the journalists shed by old media, what defines a successful future for Patch? “Now that we have a network of sites that are humming, how are we going to go everywhere?” Webster asked.

Much of that future is locked up in a redesigned site, which the company launched in five test markets in September. Webster said that the redesign remains on track to expand to most towns in 2013 but has seen some delays due to superstorm Sandy.

“We want to have a four-way conversation: not just journalist to user, but journalist to user, user to user, user to business, and business to business,” said Webster, speaking to the redesign site’s added emphasis on social features. “It’s not to say we’re not going to do journalism, but it’s more of a community hub where people can communicate with each other.”

 Photo credit: Shana Wittenwyler

  • http://www.whatburnsmybacon.com/ What Burns My Bacon

    Of course he’s going to say feel-good things about Patch. He is the president after all.

    However, Patch promised to be profitable in 2011, then 2012 and now it’s pushed back to this year, 2013. Hopefully third time’s a charm. And does being profitable mean recovering the money ($160 million in 2010 and $40 million in 2011, for example) that was put into Patch?

    And 100 Patches out of 900 making money is not a good sign.

    And it’s nice that Mr. Webster is talking about the merger of Patch sites, but there is no mention of how there are hardly any hires for editors to replace the ones that left.

    Many editors are in charge of more than one Patch and according to one report I read Patch (I’m not sure if this is company wide or regional) will be restructuring how the sites are run. But again, Mr. Webster hasn’t mentioned that.

    And from what I’ve seen in some places, sadly there is a reduction in “content” and “service” to the point that many readers are unhappy with the less-than-journalistic changes happening at Patch.

    But I sincerely hope 2013 is good to Patch, its editors and more importantly its readers.

    • Observer

      You’re being too kind.

      When there was a Hurricane Sandy relief concert at Madison Square Garden a month or two back, it was livestreamed by Youtube. Patch embedded the livestream on its local sites and bombarded readers with reminders that they could “watch the concert for free on Patch!”

      Essentially, AOL/Patch was latching itself onto a production by a competitor (Cablevision) and using another competitor’s servers (Google/Youtube) to deliver the lifted content to its readers through its local sites, functioning essentially as a shell to serve ads to viewers watching the stream.

      That’s ballsy and it’s such blatant theft it would almost be admirably clever if it wasn’t an alarming indication of just how desperate the company is to jack up that UV number.

      • http://www.whatburnsmybacon.com/ What Burns My Bacon

        I didn’t realize they did that for the Hurricane Sandy relief concert.

      • Patch St. Louis

        Actually, Patch and AOL were partners with the companies that put on the concert. The organizers asked them if they would help get the live stream out there, and they did. They also sent truckload after truckload of collected food and goods to displaced people in Patch towns after Sandy. During the Newtown shooting (I heard about this on NBC actually, despite being a Patch employee) a teacher’s aid under the desk was looking at Patch to understand what was going on, and emailing with the Patch editor for information. Since then Patch has had an expanded team in Newtown helping residents make sense of what happened and helping pull the community together. Those are just two high-profile examples, but in my experience at Patch, a million smaller but important things like this happen every day. So I ask you: What has Patch done, or not done, to inspire such ire from you? Were you fired? Did you invest early on and lost money? Does more local information in communities offend you for some reason? If you care about local news, and I would assume that you do, I would be rooting for Patch as they try to figure it out. Not trying to drag them through the mud.

        • http://www.whatburnsmybacon.com/ What Burns My Bacon

          @Patch St. Louis, it is great to hear that there are still Patch sites that do original news stories. It is what people want.

          That being said, I have seen too many once-great Patch sites that used to produce original, local news stories to now just posting click-bait items that have nothing to do with the towns and re-writing what the competition is doing and linking back to them.

          These terrible things can’t be ignored either.

          That being said I take back my comment about the YouTube thing and I honestly hope Patch does well. But there needs to be improvements.

  • http://www.facebook.com/turkeymonkey Ted Mann

    It’s easy to sit on the sidelines and heckle, but what Patch and Webster have built in a relatively short period of time is nothing short of incredible. Having tried to build a hyperlocal network myself, I can say it’s not easy, and to achieve the scale of 13 million uniques is awesome. That they’re profitable already with 100 sites is evidence that the model works and plenty of reason for AOL to be proud of sticking with Patch, despite all the naysayers.

    • http://www.whatburnsmybacon.com/ What Burns My Bacon

      Well Ted, I wasn’t on the sidelines, I was smacked in the middle of it. I was a Patch editor when it first started. When I started at Patch it was a great news website, but not so much now for many of the sites. And there were many things early on that Patch should have done but didn’t and they have suffered for it.

      I could be very critical of Patch right now, but I won’t out of respect to my former Patch friends. But I will say that there is a lot of improvement that needs to be done.

    • scottbrodbeck

      I will grant you that scaling up to 900+ sites in such short order is impressive. And 13m uniques isn’t anything to scoff at. But it’s a lot easier to do when you have a CEO who’s willing to let you burn through $100s of millions of dollars without ever returning a real profit, and an existing network of high-traffic websites to funnel you readers.

  • Observer

    This is awful, like just about every other post StreetFight has run on Patch, because it just repeats the company talking points and gives us no real information. Considering all the consolidating they’ve done, it would be worrying if some sites *weren’t* profitable, and 1/9 doesn’t even bring the company close to breaking even.

    The proof is in the pudding. Dial up your local Patch site and tell me if you see any worthwhile local content. I certainly don’t see anything worthwhile on the half-dozen sites in my area. I see polls, content ripped from local newspapers, one-photo posts, link-backs to Patch directory listings, and fluff features designed to help ad sales hook more local advertisers.

    The amount of lifted content is staggering, but that’s part of the company culture since the Huffington takeover.

    Can anyone tell me what’s so compelling about ad-bait and “aggregated” (lifted) content that Patch is a must-read in local communities? That 13.1 million UV figure sounds pretty good until you realize, 1) most of it is funneled from AOL’s other properties, and 2) with all the money dumped into Patch, AOL is paying more than $1 per UV.

  • grumblegrumble

    @349a7167daff257b27bc9ca5748c6651:disqus You should contact Patch and ask for your money back, or at least demand an apology for everything they promised they would give you and didn’t deliver. I’ll assume you were once a reader or a large-scale investor in AOL that feels ripped off. Or I might assume that you just hate free local information. Time to move on.

  • grumblegrumble

    Meant that comment for @Observer.

  • Frank675

    They say they hired 300 people in 2012 but how many did they let go in 2012? I give them another year before AOL finally saves money and moves on


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