Old newspapers should harbor new tech firms
For some time now, I've thought that doing something like this would be a good idea -- and I'm glad to see that someone, in this case the San Francisco Chronicle, just went ahead and did it.
Three startup tech companies have agreed to lease space in the Chronicle's building in San Francisco, including Square, the startup by Twitter cofounder Jack Dorsey, which I covered in the previous post.
For many newspapers, including the Chronicle, that have cut a significant chunk of their workforce the last couple years, they're dealing with a glut of available office space and many, many empty cubicles. Meanwhile, newspapers are struggling mightily to transform themselves into nimble organizations in order to succeed on the Web -- thus sharing (or wanting to share) some of the traits of a quick-moving, entrepreneurial startup.
Why not invite startups into your building? Let a few of them together build an environment for experimentation and raw creative thinking, and encourage them to interact with the landlord -- that is, the newspaper staff.
Deals are made to be cut -- and it's easy to envision scenarios where newspapers can have symbiotic relationships with the startups they harbor. Newspapers can give startups a reasonable break on rent and infrastructure support, and the startups can license their products for use by newspapers, who are looking for new revenue models.
Am I too simplistic in my thinking here?
Comments
What about the perception of journalistic bias in this situation?
No matter the amount of in-house safeguards put in place to prevent preferential or excessive coverage of the newspaper's tenants, wouldn't the perception of favoritism be created by something like this? What about area startups that weren't located in the same building?
I think this is a slippery slope. What would happen if one of said startups was found to be guilty of shady business practices, or was connected to a corrupt politician? Would the newspaper be as quick to cover the story if their rent was due that week?
The erosion of journalistic integrity is happening steadily enough as it is. Sorry Gus, but I think this is a problematic idea.
Posted by: Groundskeeper | December 2, 2009 10:09 AM
@groundskeeper - well of course there'd be a measure of bias. It wouldn't be an incubator if they weren't rooting (implicitly at least) for the success of the business. For that matter, as long as newspapers are for-profit, they will be similarly biased towards their own success.
The risk you pointed out (startup makes error, reflects poorly on host) exists in any incubator / startup relationship, I assume the legal and financial safeguards are well trodden, but loss of face could still hurt.
In any case, it seems like this is a much more mundane venture: company with too much building sublets to smaller companies. This, I'd like to believe, would be successful. If there was special emphasis on the fact that the host is a newspaper, the big hurdle would be convincing startups that they need the newspaper as much as the newspaper needs them. The pitch can't be, "Hey startups, come help us be more profitable." Especially when those startups might be looking to eat the paper's lunch.
It would have to be symbiotic, and the emphasis would have to be on the big benefits of allying with the newspaper. Data (current and historical), people, and access to an audience would be my top three.
It's an interesting idea, for sure. It would still require a lot of change on the paper's part, though. Sounds like Hearst brought in an external firm to handle most of the grunt work of developing the infrastructure and finding tenants.
You've got your work cut out for you ;)
Posted by: Adam B | December 2, 2009 1:31 PM
The Sun already leases extra space in its buildings to outside businesses.
Posted by: Linda | December 3, 2009 9:53 AM