Ben Smith, left, and Justin Smith
Source: Semaphore
Semaphore, a new digital media company focused on global news for college-educated readers, debuted Tuesday with the intention of bringing transparency and clarity to a news business that its founders believe has become highly polarized.
Semaphore has been preparing to launch since January, when it was previously The New York Times Media columnist Ben Smith and former Bloomberg Media CEO Justin Smith quit their jobs to start the project. Semafor.com and its mobile site will have a distinct yellow background to match coverage in the US and Sub-Saharan Africa. The news company will provide regional and national coverage in the Middle East, Asia, Europe and other countries.
The Smiths will take lessons learned from more than 20 years in digital media to guide Semafor into what they hope will be a profitable global business.
Recent sales to Axios (to Cox Enterprises), The Athletic (to The New York Times) and Politico (to Axel Springer) have given way to building and selling a company for hundreds of millions of dollars, although Justin Smith said he hasn’t had any conversations about Selling at a specific valuation with Semaphore investors. These include Sam Bankman-Fried, founder of cryptocurrency exchange FTX, and Jessica Lisin, founder of tech news site The Information.
However, ad-supported digital media is still a sector known for stagnation, drought, and low growth – with plenty of cautionary tales. BuzzFeed Its value has seen a sharp drop of 80% since it went public. Vice’s bid to go public failed as investors fretted about its future prospects. He has been trying to find a buyer for several years.
Semaphore will immediately stand out from older news publications such as The New York Times, Wall Steet Journal or CNN.com through its unique article structure. All stories, except for potential breaking news, will adhere to the Semaform, which has five sections: “News,” “Reporter’s Perspective,” “Area of Difference,” “View From” and “Notable.”
Each story will give reporters a chance to influence the news themselves, in a specific section, including paragraphs about why what they’re doing is wrong. The stories will also include a section that gives a holistic/global perspective to reduce local bias.
To solve the information overload problem, there is a major flaw in the current media ecosystem, according to Justin Smith, the analysis of external media will be truncated and found in the notable section. “Semaform” stems from Justin Smith’s experience managing newsrooms at Bloomberg, The Atlantic, Quartz, and The Week, along with Ben Smith’s time as editor-in-chief at BuzzFeed News and his time at The New York Times.
It’s an evolution of Axios’s news distillation into bullet points, the “Bloomberg Way” (a style guide focused on clarity) and the week’s focus on a wide range of viewpoints.
“We started trying to isolate and deconstruct individual issues, like polarization and information overload,” Smith said. “We went to different segments of users with meaningful conversations, and asked them about some of the ideas we had developed. There was a real sense of frustration but also amazed that the basic unit of journalism – the article – hadn’t really developed in hundreds and hundreds of years.”
work plan
Justin Smith said Semafor will start out as a free ad-supported media site, but will evolve into a paywalled subscription site in about 12 to 18 months, as it gains brand recognition. Despite being launched at a time of economic uncertainty when brands are cautious about how they spend on digital media advertising, Semaphore will launch with partnerships with companies including Verizon And the Pfizer.
“We are definitely ahead of what we expected in terms of revenue and monetization,” said Rachel Oppenheim, chief revenue officer at Semaphore. “We operate in a specific segment of the advertising market, which is corporate reputation and brand advertising. And while brands are under pressure from a financial perspective, they are also under huge pressure to enhance their reputation and reach key stakeholders. One of the hallmarks of many of the conversations we’ve had is, ” I’ve never seen anything like this before.’ It was so fun and encouraging.”
Justin Smith said Semaphore raised $25 million and had not had any discussions with its investors about evaluating a potential exit, despite sharing a five-year business plan with investors. He added that it will spend its initial investment and gauge how the business is going before setting firm profitability goals or raising more money.
Ben and Justin Smith named the company semaphore after the word “simaphore,” a visual signaling device, which sounds the same in about 35 different languages. The media company will have about 60 employees, more than half of whom will be reporters.
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