Well Ive been wanting to write this kind of a post since a long time now but I guess everything has its own time and the recent acquisition of ContentNext Media which owns Paidcontent (alongwith its indian blog contentSutra) for 30 Million $ by The Guardian has thrown up interesting opportunities, questions and realisation for folks who are following a similar business model in India. Now in order to answer the above question we approached three Business/Media owners who have media properties in the same space.

We spoke to:

Sidharth Rao - Founder of WebChutney which has incubated Alootechie.net via GooseFish Media Ventures its investment and incubation arm. Rajesh Barnwal manages alootechie and its surge up the digital space.

Sahad PV - Founder of VCCircle.com. Previously the editor of contentSutra who worked closely with Rafat Ali and was intrumental in establishing contentSuta.

Nikhil Pahwa - Founder of Mixedbag Media (Will be officially launching medianama.com on 18th july). Previously the editor of contentSutra. Worked closely with Rafat and took contentSutra to the next level after Sahad had left.

We asked them the following questions:

1. What do you think will be the impact of the paidcontent deal for India? If any?
2. Do you think this might create interest from Vc’s for similar models in India??
3. What can bring scalability to this kind of business and what would be the revenue model in India? Would it be ads like in the west?
4. Who do you think Will be the Rafat Ali (Paid content) of India? (besides for your own)?
5. Whats the longtem objective with your media?

WATBlog: What do you think will be the impact of the paidcontent deal for India? If any?

Sidharth: I guess we all (you (watblog.com), me(alootechie.net), rajesh(alootechie.net), nikhil(medianama.com) ashish(pluggd.in) and others) want to believe that the impact would be positive but the reality is that these are still very early days for online in India. Atleast there is a reference point for everyone to stay inspired and encouraged.

Sahad: I think it’s a pointer to the fact that sustainable online media businesses can be built over time, and these online only businesses have scored over traditional media businesses in building a community online, leveraging them offline through conferences. And online businesses are more nimble footed and they are cost effective to certain extent but the biggest challenge is to build the credibility as an online media company.

Nikhil: In terms of coverage, we might see an infusion of capital for the India operations. With more capital, contentSutra will be in a position to hire more journalists, and hence an improvement in the coverage. This will help drive competition, which can only be good for the ecosystem, and will push the others to improve. contentSutra also brings with it significant international content and connections, and its credibility has made it the de-facto destination for those looking to do deals/invest in India. In terms of deals here - since an international precedent has been set, there may be an interest from Venture Capitalists, but I doubt it. Content businesses are difficult to scale alone, and there’s no such thing as a a quick exit. A strategic investment might be an option, but at present, Indian media companies haven’t yet begun to take blogs very seriously as an investment destination.

WATBlog: Do you think this might create interest from Vc’s for similar models in India??

Sidharth: Realistically, I don’t think so. A potential readerbase of 10-30k is certainly not something that would generate interest from VCs. Very few online b2b content plays in India that have attracted funding in any form recently - afaqs.com has seedfund and I don’t remember anybody else. But if we all start gaining further reader traction and then monetizing well, It would be interesting to see how it interests traditional B2B publishers in India in models like these in the coming days (cybermedia, infomedia, haymarket etc) since it was really their space and they are pretty late in the game.

Sahad: It should. But the exit routes and scalability is still unclear in Indian context.Also Indian traditional media companies are not really used to buying companies - or at least used to paying top dollars they like building their own assets. Probably a foreign media company can look at acquiring Indian assets if they are of value to them and also if they fit in to their overall scheme of things.So it all depends on what niche are you operating, and how much have you built up.

Nikhil: With regards to interest by Vc’s. My question would be - are there any companies operating in this space with systems, processes and a structure in place? Perhaps just one, so far. We might see seed capital for players in this space but I dont know whether VCs would be interested in this business. Interest from angel investors is there at present, and the same for strategic investments, but valuations are anybodys guess.

WATBlog: What can bring scalability to this kind of business and what would be the revenue model in India? Would it be ads like in the west?

Sidharth: I don’t think advertising alone is the answer. Even paidcontent had a highly successful event Economics of Social Media. And they did do research reports as well. Also, agencyfaqs and exchange4media do have a mix of these and they perhaps are the bunch for us to learn from. On a separate note, I guess we need a collection of these ‘nano publishing ideas to offer to marketers as a bouqet for us to build any significant scale.

Sahad: Revenue model based on ads look very long term. It will take atleast 3-5 years to mature. On what will bring scale I think I cant say that unless i know whose business it is and I dont want to talk about my business

Nikhil: People need to realise that ContentNext is a b2b trade media company. In this business, scalability comes with people, and that is the key issue holding back growth. There are 4-5 business newspapers in the country, another 3 in the process of being launched, 4 business TV channels with perhaps another in the wings. Also a large number of business magazines. Where are the people to power the editorial content of these businesses?

Websites and blogs will attract only those passionate about these domains, and frankly, it’s difficult to come across people with knowledge of the domain, great writing skills, and the instincts of a journalist. One way is to catch them young, and offer them ownership. In terms of revenue models - my belief is that the web-only revenue potential exists, but its just that advertisers haven’t realised that yet. The targeting that b2b media sites offer is something that a horizontal can’t. Advertisers see greater value in, for example, monthly or weekly tech magazines, but forget that a large number of tech enthusiasts read these sites daily. The revenue streams would be similar to that of any other b2b trade media publication - online advertising, classifieds and events.

Finally The question this post aims to answer!

Who do you think Will be the Rafat Ali (Paid content) of India? (besides for media ofcourse)?

Sidharth: I don’t think we should define the race like that. What’s worked there is not neccessarily the ideal mix that will work here. We don’t have a decent version of a clickz (the earlier interactive marketing goto destination site), We have a long way to go before we even come close.

Sahad: I havent seen anyone scaled to that extent. None is worth mentioning as of now and we will have to wait for a year more as it’s too early.

Nikhil: I think everyone would like to be the Rafat Ali of India - a $30 million exit is no small feat - but remember that ContentNext wasn’t restricted to just one domain (Online Content) or one geography alone. Scale can come with depth and breadth. Well so no one wanted to take someone else’s name. So we asked them what’s their longterm goal with their venture.

Whats the longtem objective of your media?

Sidharth: The Goto destination for the digital industry is what Rajesh has set out to do. And I am certain he will

Sahad: We will be opportunistic and try to build a multi media company focused on the investment space. We will be nimble footed and tap opportunities that works in Indian context.

Nikhil: MediaNama intends to provide independent, authenticated and comprehensive news, analysis and information to support the fledgling Digital Media community in India with special emphasis on emerging business segments like mobile payments, MVNOs, local language content, among others. MixedBag Media story will unfold over time.

WATBlog: Well the post still doesn’t answer the question Who will be The Rafat ali of India? But it does give an insight into what it takes to get there.

So here is my (Rajiv Dingra’s) answer to who it might be.

From a resources perspective - Alootechie.net: Being backed by webchutney which inturn is backed by Capital 18 has its advantages.

From an experience and credibility perspective: VCCircle.com - Sahad established contentSutra through 2005 and VCcircle is possibly the must read for all VC’s in India. Both from a credibility and a experience standpoint he is ahead of anyone else.

From a talent and potential perspective: Medianama.com - In the short time nikhil has shown his flair for blogging can really be appreciated. He was the one who took contentSutra to the next level and even after he has left he has a very strong hold with his network and connections he built at contentSutra.

So who do you think will be the next Rafat Ali (Paidcontent) of india?

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