Bizyhood is shutting down on May 15.
That simple sentence was a very hard one to write.
We’ve been working on Bizyhood for a long time. After building several iterations of the service, we launched in 2015 with a model that we thought was exactly right: Providing a brand new revenue stream for local digital publishers that focused on quality lead generation for the small and local businesses in their community.
In theory, it was a great idea. Small and local businesses don’t tend to have a lot of money to spend on marketing, so they are ignored by pretty much everyone. Local digital publishers offer a unique product (local news) to a unique market (local markets), so why not provide them a platform to connect readers and businesses specifically in that local market? The initial reaction from our target publishers was great. We had some early adopters, a great idea, and a willingness to test and measure all the feedback.
Our passion was fueled by countless hours of work, some truly amazing business partners, and a lot of trial and error. Bizyhood was not fueled by the type of funding that’s required to launch a platform, and we were not able to build a network effect quickly enough to become profitable organically. As with most startups with an innovative idea, we were bucking long odds. Most of the top SaaS Venture Capitalists say it takes 7-10 years to bootstrap a business to profitability. We were 5 years in, burning cash, and still seeing a very long road to breaking even. Regardless of the odds being against us, our passion remained high. Unfortunately we simply ran out of money.
We still believe passionately in this vision. As technologists, we’re taught to think big and to focus on global platforms that can get billions of eyeballs. But as the headlines of the past two years have shown, there is a lot of inauthentic voices in global platforms. A local platform that is authentic and curated is sorely missing and desperately needed. We still believe it will happen, it just won’t be Bizyhood that delivers it.
We believe that the revenue model we pioneered can replace digital advertising revenue. This was likely our largest disconnect with our publishing partners, as advertising provides the bulk of the revenue for local publishers today. It doesn’t work and the churn rate is extremely high. But there is a level of loyalty in local publishing where once a publisher gets a ramp rate of business, it pays the bills. There is no interest in eating more into that revenue stream than Facebook and Google are already doing. While the local publishers have motivation to try new things, they don’t have the capability or the means to invest in ideas – they need to work quickly or they get displaced.
We wish we could have achieved a different outcome. We dreamed of helping a new generation of local digital publishers grow and prosper, so that true local reporting could be done again – we still feel that the world needs quality local reporting that has a sustainable and profitable revenue model.
At the end of the day, we (like the publishers we have worked with these past 3+ years) needed to generate revenue. And we didn’t generate enough – for us, or for our publishers. So, for now, we take a few steps back, think about what’s next, and wish our partners all the best.
This has been a wonderful experience and we will cherish the friends we made and the lessons learned.
Your friends at Bizyhood