If summarization is the future of news consumption, Seeking Alpha wants to be the one to deliver it.
Clearly the startup, founded almost ten years ago, isn’t the only one to believe people like consuming mobile news in bite-sized chunks. Yahoo’s acquisition of Summly and Google’s investment in Wavii shows interest in summarization from the Web giants. Both startups use algorithms to summarize news into bite-sized, mobile-friendly apps.
“People have limited attention spans and want the core points delivered to them,” says founder David Jackson. The fine art of narrative storytelling is not meant for mobile devices. To be sure, it seems the Web is encouraging a wider separation between “stock and flow” content. Just as Summly and Wavii provide snippets and summaries, companies from Narratively and Longform.org to The New York Times and Politico are ushering in a new era of long-form journalism. PandoDaily might even be a micro-cosm for this trend — long form stories (“stock”) go in the middle of the page and “flow” content, ie, news summaries, go in the Ticker.
Like us, Seeking Alpha believes in human-curated news items. The company won’t reveal how many editors it has for competitive reasons (okay…?) but it has 110 employees, a good chunk of which spend their days aggregating and summarizing stock news.
“The key question any serious publisher will have to grabble with is where do you use humans and where do you use algorithms (with short form summaries),” Jackson says. Seeking Alpha uses an in-house algorithm for summarizing instant information on basic releases like earnings coverage and dividend announcements.
But most of Seeking Alpha’s news coverage uses humans. It’s better, Jackson says, because “you have to communicate to the reader, ‘Why does this matter? What has happened to the stock?'” Often the human editors are there simply to decide not to include a press release. “Companies churn out thousands of press releases a day, so if you just summarize it all, you get noise,” he says. Seeking Alpha is constantly looking at various algorithm solutions in the market. (News robot Narrative Science comes to mind.) But each time, the company winds up going back to human aggregators. It’s like I argued last year, in the article “Big data be damned, the Web still needs a human touch.”
The excitement over big data right now is often just that: excitement. Big data is not as simple as a few inputs and outputs, warns Scott Brave, co-founder and CTO of ecommerce personalization software maker Baynote. “Modeling isn’t magic, there is always a human element in there, and people often forget that,” he says. Framing data in a way that’s actually useful takes as much art as it does science.
This week Seeking Alpha launched a brand new Tech Investor app. Already it has 70,000 daily users with very little spent on marketing. Overall, Seeking Alpha’s apps have 600,000 to 800,000 daily users. Seeking Alpha remains free and has yet to figure out its monetization strategy for its mobile apps. The biggest competition to its free products are expensive offerings from First Word, owned by Bloomberg and StreetAccount, which was acquired by Factset. Those offerings cost around $1000 a seat.
On the web, Seeking Alpha has 1.1 million email subscribers. The company earns revenue through on-site advertising and professional products, which offer market-moving stories to subscribers a day early. While 1.1 million people doesn’t sound like many to startups where “10 million is the new one million,” Jackson says he cares more about engagement rates with Seeking Alpha’s core user base. He believes 70,000 daily actives is a meaningful number in an addressable market of around 10 million, he says. “We track whether our articles move stocks — once you are moving stocks, almost by definition you’re going to be valuable to someone,” he says.
In 2009 Seeking Alpha raised $7 million from DAG Ventures, Benchmark and Accel Partners, which is an investor in PandoDaily.