Q&A – Steve Rhodes, The Beachwood Reporter
Q: Can you tell me how is it: working for a start up vs working for a more established company?
A: Sure. It's both more terrifying and more exhilarating. There are all kinds of start ups. For me a start up was me and a bunch of my friends and a not a whole a lot of money. It's like we were a start up with silicon valley investment or like the new Glenn Greenwald start up or something like that, so the main thing though is that as a start up you lack resources and kind of a support structure that a company in our work for Chicago Magazine and theChicago Tribune and Newsweek and when you work for a company you don't have to worry about even little things like having enough pens and notebooks - you have an infrastructure. But at the same time, the positive side of working for a start up is just that you can essentially do what you want. You don't have to do things that you'd rather not most of the time. You don't have to work with people whom you don't like working for. You don't have to follow orders that are absurd, so I'd say those are the differences.
Q: How can a young entrepreneur raise money to fund a project?
A: What I learned is just how people do that, because I didn't come from that kind of background, so it was a new territory for me. The most successful ways that young entrepreneurs get money is either to have been born into a wealthy family or have wealthy friends or benefactors. I wish very badly that it was a more meritorious system. It's incredibly frustrating, because I was not born into a wealthy family. I've never had any money and my friends don't have any money, but what I've seen all around me is people that have access to capital which is money, so what I've learned is that the first thing that people do, I started studying entrepreneurialism and going to forums and subscribing to email newsletters to learn that side of business, and what I learned that the first thing that most people do is what they call a friends and family round. That's a round of fund raisings in which you go to your friends and family (laugh) and a lot of people come out of that round with thousands of dollars. For someone like me, a friends and family round will get me about 20 bucks, so there is that. And the second thing is ethnicity of a great idea and you really think that it can be profitable. It's extremely difficult to get that idea in front of possible funders, so again you just have to try attend every event that you can, so people are really into the networking. You know, there are other ways to raise money that are used a lot in journalism projects of course - like soliciting donations and offering memberships and that kind of things, so the way that you'll raise revenue as an ongoing business, but the way to initially raise money as an entrepreneur is very difficult and most of the kinds of rugs to riches stories are really false. I mean people forget that Bill Gates for example grew up in a wealthy family. A lot of those people who say that they grew up with nothing actually had wealth around them - in one way or another, so for someone like me who doesn't have that I think that you just have to enlist others in your passion and so for me - my whole pitch was to tell people that if we all pull together we will all basically create our dream jobs. That does not necessary raise money, but it does help kind of attract coworkers or other people who become invested.
Q: How would you describe your idea, "The Beachwood Reporter" in terms of getting funds: was it a really hard process in general?
A: I would say it's been half hazard. It's been up and down and it's been never ending, so I started with my own personal savings. I saved money for a couple years, knowing I was going to do this, so I had $25,000 and then at the end of the first year of existence we took in a few thousands dollars in advertising and donations an various things. We got a lot of pro bono services from people like some legal help, accounting help - people willing to do that. But then, at the end of our first year a fan of mine - a reader who've been reading me since I was at Chicago Magazine - we've become friendly and him and a buddy of him decided to make an investment, so they've put in $30,000 dollars. Now, that's a small investment that I am talking about. Other projects around town are getting a million bucks from the McArthur foundation, but for me that funded a year or two essentially and then I did get like a $35,000 grant from the Chicago community trust one year, so that funded another year. And then, I was doing some freelance work and kind of had a partnership with NBC Chicago to blog for them and do some cross posting and so on, so that funded me for another year or a year and a half. That's just kind of the way it's gone. I've had to ruin my sterling and credit bathing and I've had to take more freelance work, because the whole business side of things was never really enough to pull together in a way that I've had hoped, but like I've said it's really frustrating. This company is existing for eight years and I've seen a lot of other ventures around town get hundreds of thousands if not over a million dollars in funding and flame out. It kind of drives me nuts to think about what I feel I could of done with money like that, given that I've survived and put out a product that's editorially successful, so I guess the real answer is not that it happens quickly or slowly. It's that it's continuing. Finding resources continues to be an issue.
Q: What was your general vision before launching "The Beachwood Reporter"? Did you have a business plan or an idea that you wanted to introduce?
A: The real business plan was that I've never thought that a site like "The Beachwood Reporter" or a general interest local news site could ever generate enough revenue to support full-time stuff, so in kind of looking at the business models that worked and continue to work - it appeared to me that the real answer was to have a stable of sites - whether you want to say niche or niched sites or verticals or whatever term you want to use. Ironically, this is actually the model that newspapers used to exist on. The metro section has never, ever been profitable when it was in print. With online journalism, we should really refer to sections as much, even though they're still organized this way, but even the sports section - and I think that a lot of people will be surprised - never really derived a lot of revenue. They've had a lot of ads. The way that the newspapers made money was - in addition to classified ads was really through speciality sections - the sections that made your Sunday papers so thick: the real estate section, the transportation section, the travel section - because these are all really ad-friendly and that's how they kind of drove the revenue. The metro section - the actual real news was actually subsidized by these other sections. In the 70s, the New York Times famously saved itself from financial disaster by finally creating those types of sections that you see today. They didn't always have the Arts & Entertainment sections and all of the other sections that they have in a Sunday's paper. I saw that this is what appeared to work on the internet as well when I looked at the company like Gawker that operates in a lot of subject areas and there was a company back then called Weblogs, Inc. which has something like a 100 different blogs about things like food you'd find in a vending machine and a real off-beat things. They sold themselves to AOL for $25 million which at the time was a lot and I continued to see that seems to be the way that a lot of internet projects are successful, so my idea was to have six-seven-eight other sites that would be the revenue producing sites that would subsidize the real reporting and commentary that I really wanted to do at the Beachwood and I have the ideas for those other sites and I still have them, but I've never been able to find the right business and/or technology partner to really ramp up any of those sites. I mean, it's hard enough doing everything I do what I do to keep this going, that really will require more resources and a partner and I've just not ever been able to find that. That was the vision and it remains the vision if that would ever happen. I don't know if it ever really will. It's been eight years, but that was the original idea.
Q: How is "The Beachwood Reporter" operating now? Is it mostly funded by grants and donations or is it getting revenue through ads?
A: It doesn't cost a whole lot to run "The Beachwood Reporter". I mean a hosting fee every month. The whole stuff are volunteers and it's basically my freelance work right now. I've had one grant that run out and I have one investor that's still with me, but there is no more money that is going to come from that. We used to sell a few thousands dollars a year in advertising, but we really haven't tried to sell advertising in the last couple of years. I work really hard on it everyday, but in a certain sense it's on cruise control and I just earn money through a lot of other kinds of outside projects as best as I can until I will figure out what to do next.
Q: Where do you see "The Beachwood Reporter" in the future?
A: I either see in in Brooklyn (sighs) or maybe existing just as a tumblr for me and my friends to just keep writing or shutting down. I don't know if I really see much of the future at this point. I mean that I am gonna keep it going as long as I can, but I've became pretty convinced that I am not gonna be able to the kinds of things that I wanna do by staying in Chicago, so I am really thinking about a future in New York or possibly even LA and the Beachwood maybe will still exist as a tumblr or hopefully the ideas that I've had for it - I can transfer to some other project on the coast, but I am not optimistic about the future of the Beachwood here in Chicago, except only in so far that I am still trapped here in the city. That's basically my view on that…
Q: Why can't you see the future of "The Beachwood Reporter" in Chicago?
A: Well, I've been here doing the Beachwood for eight years, and I haven't found the right kind of partner or like I've said business or technology partner. I haven't found a right kind of support here and I just don't thing that it's gonna be found. I've run out of the string here and I don't think Chicago is still a very parochial city and it's not the kind of city that I think it's gonna support a project like this. In a place like New York, you have more of a critical mass of a certain kind of reader, a certain kind of talent. There is actually a shortage of technology talent in Chicago. I mean, I've read many articles, lamenting the lack of programmers here and it doesn't mean that they're not a lot here, but they're not enough. When Groupon has to go all over the country to find people to bring in and WBEZ - there is a big hullabaloo in there, because they're new CEO comes from Washington and that caused a little bit of backlash by people here, because it's someone who's got experience in digital. People here are saying: "Oh, you couldn't find anyone in Chicago that had a right kind of digital experience. You must not been looking hard enough.", but I am here to tell you: like who? Look around the city. The Sun-Times? When Michael Ferro bought the Sun-Times he was supposed to be some kind of a digital genius, despite the fact that his history didn't show it and that thing is a freaking mess digitally. Where would you go for digital talent in Chicago on that level? Because I don't see anyone really employing it. I mean outside of maybe some of the people at the Trib on a digital side, but who else? I mean, I just can't think about anyone else just doing anything in this city where you'd head hunt from to say that they're digital geniuses. I just don't think that's the environment that we have here…
Q: I've recently looked at builtinchicago.org and some other websites to look at the local entrepreneurs. How would you describe Chicago's entrepreneurs? Are we successful as a city?
A: I don't know. Everything is so relative. When Groupon is your big prize, I am not a big fan. So I have to say: "Wow! That's the big saying you have to show the world?" Someone said to me a long time ago that Chicago is still a CowTown at heart and I believe it - despite kind of the glitz and now we have world class restaurants and the theater scene all that stuff. It is true: Chicago does have those things, but it's still a CowTown: it's still very cautious, parochial; no one wants to offend anyone - everyone want to be friends, so there is a huge lack of critical thinking, so to me - I don't find it to be an inventing entrepreneurial culture. I mean, I don't know what is. I can imagine a place like Austin, Texas being way more interesting or Boston or even probably a place like Seattle. I think that they are just different cultures. And the politics here - the political culture here doesn't help and the political bleeds into everything else. The political culture here is built on clouds, but that's how everyone else behaves too , even in the newsrooms that decry it. It's not really a meritorious culture. There is so many J. B. Pritzkers around town - there is one. Where else do you go? And he doesn't know anything about the digital news space. He knows about other kinds of technology, so I don't know - maybe it's better than other places. I can't say because I haven't lived anywhere else for 25 years, so I don't know the global view, but I read a lot about this stuff and I am pretty much convinced that we're not nearly as great as some people here think we are.
Q: In your opinion: is it easier for new entrepreneurs to enter the scene now, comparing it to the past decades?
A: It's easier in media for sure simply because… even ten, fifteen or twenty years ago I wouldn't of been able to just start my website, so in that sense the barriers of entry are much lower. That's just one of the awesome things about the internet and it's probably easier to do than the days when would start their own newspapers, because you'll have to pay for the news print and get it printed somewhere and then deliver it, distribute. I think that it's easier to me to start something in the media work and have it work, but it's still gonna work only for a limited number of people - which is fine. It shouldn't work for everybody, because not everybody puts out a product worth being successful, but I think that it is easier. Coming out of college, when I came out of college in the late 80s, you went and worked in some small town newspaper and tried to work your way up the chain, but now - you can come out of college and start your own project or launch on to a start up or do something and stay in the big city - if that is what you want. So I do think that the positive side of it for sure. I am kind of a digital evangelist for journalism. I think that digital journalism is way superior to print journalism, even thug I came out as as an old school newspaper guy. I think digital journalism is way superior, but the unfortunate part is still how the resources are distributed and that a lot of people who were so slow to come to the internet and in some way still despise the internet and wish things were like they were in the old days. A lot of those people are still the people that are deciding things like grants and investments and that sort of thing, so that kind of gets in the way. New thinking isn't really welcomed. People kind of jump on the fads. That's why for a long time, all of the sudden - money got poured into citizen journalism, which was always kind of a wank and hundreds of thousands of dollars - millions really - just locally in Chicago - not to mention the rest of the country were poured into failed citizen journalism projects and they hyperlocal became the big thing, which is also a wank in my view and just millions of dollars wasted on that kind of thing. Or just millions of dollars going to something like The Chicago News Cooperative. They had an agreement to partner up with The New York Times. They've never had a business plan, but James O'Shea able to walk in to MacArthur and walk out with a million dollars without a business plan. A guy who when he was a Tribune managing editor was a huge obstacle to their digital efforts. He hated the internet, so those are the kind of obstacles that still exist. Getting rid of that mindset is what we need to do in Chicago, but in the overall sense - it's absolutely easier to do your own thing these days.
Q: What kind of changes would like to see here in Chicago? Would you like to see more input from the city or more openness to new ideas from people?
A: I would like to see less input from the city itself. I think civic data movement and the civic hackers are way too aligned with the city government here and they are way too cozy with city government and so they do a lot of projects and people brag about that. One: they don't have real utility for actual, real people. Two: they're propaganda props that allow the mayor to say: "Hey look, we put all of this data online." The data that isn't useful to anybody, but meanwhile - you can't get any information out of the city - the information that you want through the Freedom of Information Act and that sort of thing. And then, it ties up those resources, because those technologists are just - I think that they fall so in love with those data sets, but they're not thinking like a journalist - meaning that they don't think about answering questions, interpreting the data and serving the readers and citizens. That's a different mindset, so I wish that those people and the technologists would devote themselves more to journalism, which is different - to working with the journalists rather than kind of working with the politicians. I mean, that like the antithesis of what someone like me does. That will be one thing from one standpoint and then from the standpoint of the foundations - like MacArthur and McCormick, I just see them sending millions of dollars out of the door to projects, like the ones that I've mentioned, that make no sense that they are operating in a really old school mentality. They need more people in those foundations who are the actual, real media thinkers, who actually know something about online media and news and don't just kind of pretend or follow the trends and the fads, so the foundation community could step up. I don't really know how you're gonna the investor community to take more risks, cause they're not really into risk taking. That's the emphasis of what they do, but I wish that overall that the community would think more about content, not tools - technological tools are really great, but the end of the day journalism is about content and it's about changing the way we think of how we do the content. It's not about just putting a newspaper article online. We're still in the age of shovelware - with newspapers. 99% of the newspaper articles that are online these days don't even have links which is just astounding to me. I've been harping about it for about 8 years. There still hasn't been a change of mindset, despite the rhetoric that you hear. All of those things add up to in my mind Chicago being a very discouraging place. I'd like to see all of those people to get a clue, but I wouldn't hold my breath.
Q: Can you think about any tips that you could give to young entrepreneurs?
A: I don't know if I really have any tips. It might be to ignore people's advice. I've read all of the tips and advices for entrepreneurs, all of the subscribe email newsletters. I don't know if I read many books, but I know that I've read a couple. I started reading The Wall Street Journal small business section and all of that stuff and I noticed that a lot of people are an awful lot of money dispensing advice which is kind of a racket, because a lot of the advices - when you really look at the advices and tips that the consultants say - they really are odd. Some people say: "Do this first" and some other people say: "Never do that first" and I just don't think that there is a formula or a template. For some people is like "You have to have a business plan", but as I went along I found that the thing with start ups now is to not have a business plan. It's really about the story that you tell. What's more important is to just do it, cause then you have a business instead of a plan, because business plans are essentially a made up numbers. I see a lot of conflicting advices. I read about success stories and the pattern is never really the same. The route that people take is just so different. For some people it's just like: "You know what, for the first three years I just did nothing, but this business. I gave up my entire outside life" and then you read someone else's and they say: "The key was that I kept the balance in my life and if I haven't done that I would of burned out" or "You can't obsess too much about what you do or you're gonna start making bad judgements." I just don't think that there is a formula, so I just think you just have to be you. To succeed or fail being you. At least that way if you fail, you failed your way and you don't have to have second thoughts like "Gee, I wish that I just would of done it the way I wanted. I wonder if that would of worked." I would just say: be you. You can listen to advice and read other people's stories because they can give you good ideas here and there, but I wouldn't try to follow anyone else's steps. People seem to think that there is a pattern for some weird reasons. My whole life, I've been reading a lot about management tips and leadership styles and all of that stuff. You can learn some things. You can learn some little tricks, but ultimately - you can't change who you are, so what you have to do is try to maximize the parts about who you are to the situation to make it work the best. I think about different editors that I've had and some succeed, because they are really firm and almost stern. When it suits their personality and they're successful - working with you that way, then that can work, but they are some people who behave that way and it can be alienating and not very communicative and not nurturing. And then they are some editors that really care about you as a person and they really are highly communicative and personable and that kind of thing. That can work work for some people, but then for some editors who have that style that's counterproductive, so it's not that one style is better than another. I think it's that they are a lot of different management leadership styles - just like they are a lot of different entrepreneurial styles and I think that the key is to be yourself and then try to learn how being yourself works best. So if you have a stern personality don't try to be a touchy feely editor, but try to learn how that kind of management style works best and add some of those things to your repertoire.
You might recognize that you can have that style, but here are some of the things to watch for, so that every once in a while
you're gonna have to communicate better or whatever the case may be. I guess that's what I would say: instead of adopting a style onto yourself, try to put yourself in a style if that makes sense...
kianamaiart
dailybridgerton
yousharknotpass
snowghoul
baratheonpilled
prguitarman