How ICFJ is Incubating Media Startups in Latin America and Beyond

Dec 52014
  • ICFJ President Joyce Barnathan speaks at the Guadalajara International Book Fair. Courtesy of Universidad de Guadalajara.

On Dec. 4, ICFJ President Joyce Barnathan spoke at the Hackathon of Science and Journalism Innovation, funded by the Inter-American Development Bank. The gathering took place at Guadalajara International Book Fair.

Here's an adapted version of her remarks:

We all know how much technology is transforming the news industry. There is unprecedented potential now for science and tech to help deepen news coverage, expand access to information and engage citizens in the news process. For Latin America, innovative, intelligent, interactive journalism is key to empowering citizens with quality information that will help them make better decisions in their lives.

ICFJ has been focusing our attention on the region, where we are finding talented media entrepreneurs and pioneering news organizations eager to blaze the trail in providing the best digital news possible. By working with them and groups like IDB, we hope to foster a culture of news innovation that benefits the public good.

Much of ICFJ’s work has been to help existing news organizations adapt to the digital era by embracing new tools and services. But increasingly, we are also “incubating” entirely new digital media organizations or startups that provide services to news organizations. Like Guadalajara, we recognize the need for change and we’re eager to play a lead role in the digital media era.

As in the United States, some of the new digital only organizations can fill a niche that traditional media can’t or don’t – such as hyper-local news about under-covered communities, or coverage of specialized topics such as business or environmental issues. Others may not be news organizations but companies or non-profits that help existing news organizations with digital needs.

Mexico has seen a significant development of new digital-only media over the last few years. Animal Politico, Sinembargo, e-consulta, LadoBe, ChiapasParalelo are good examples of this trend. Like many start-ups, however, these online publications are facing a crucial challenge: how do you survive economically and at the same time maintain your independent voice?

One thing we take for granted in my country are the deep pools of investment capital. We have venture capitalists willing to take risks at a variety of media startups in hopes of finding the next Twitter or Facebook. This financial infrastructure does not exist in most of the developing world, where governments and corporations often have cozy if not collusive relationships. Developing independent voices of news is not usually on the official agenda.

But the scene is starting to change. Social investors in the U.S. and Latin America are starting to pay attention. The Media Development Investment Fund (which used to be the Media Development Loan Fund) is now busy scouting for possible investments in news startups as a way to support independent media.

The founder of this group, Sasa Vucinic, originally got his startup funds from George Soros.

Vucinic has left and started his own “accelerator” called North Base Media with Marcus Brauchli, the former Executive Editor of the Washington Post. “NBM focuses on both early- and mid-stage companies that show promise in key emerging markets.”

Another is NXTP Labs (Next Step), which received a $5 million equity investment from the Multilateral Investment Fund, a member of the Inter-American Development Bank Group.

Based in Argentina, NXTP is an investment fund with an acceleration program focusing on Latin America.

I mention these three because ICFJ Knight Fellows are nurturing startups and attracting the attention of these new social investors. Too often, start-ups are launched by journalists who have no idea how to make their new businesses sustainable, so our goal is to make sure they get the help they need to survive economically in tough markets.

Our Argentine Knight Fellow, Mariano Blejman, launched Media Factory, Latin America’s first incubator for online media organizations. From 115 applications, 58 interviews and 34 finalists, Blejman and his team chose three media startups that would receive $75,000 in funding each, plus intensive mentoring. The funders are the three I’ve just mentioned: the Media Development Investment Fund, North Base Media and Argentina-based NXTPLabs. Each invested $25,000 in each startup for a five percent stake.

The three winners went to Buenos Aires in April for four months of mentoring from experts (Latin American and U.S.) on creating a business plan, increasing traffic, improving content and using the best technology. The three sites already have a combined viewership of 1.25 million unique monthly visitors.

The three winners are:

El Cambur, based in Venezuela. Venezuela has an extremely polarized media situation, with all traditional media either firmly pro-Chavez (and his successor, Nicolas Maduro) or firmly against. (Few of the latter have managed to survive.) El Cambur describes itself as “radically committed to the political center,” a desperate need in Venezuela. It focuses on fact- and data-based journalism. They officially launched in August at the end of the mentoring period, and are quickly building a name as an independent source of news in Venezuela.

GKillCity (based in Ecuador). Like Venezuela, Ecuador lacks media that are not beholden to political or economic interests. GKillCity sees itself as a citizen-fed counterculture digital magazine. It came to the Media Factory as a fairly static weekly publication and left as a more dynamic daily. It now has 300 contributors around the world, and about 200,000 unique monthly visitors. The owners said Media Factory has given them the ability to generate ads for the first time and to broaden its audience with new types of content.

El Meme (based in Argentina). El Meme was the most well-developed of the three projects at the start of Media Factory. It offers news, pop culture and entertainment and now has a million unique visitors per month – increasing 60 percent just in August (the final month of the mentoring). Since participating in Media Factory, El Meme has built a commercial department, launched a weekly newsletter, and hired an editor to improve content. Said Mercedes Reyna, El Meme’s co-founder: “All mentors helped us in every possible way, how to increase traffic, metrics, monetizing alternatives, content planning, workflow, etc.”

Blejman is now planning for the second round of Media Factory in 2015.

Blejman also created HackLabs, a project aimed at launching digital-media projects that use data, embrace new technology and engage citizens. In one year, HacksLabs has raised more than $250,000 to back startups in the region, promoting a wave of innovation across Latin America.

Blejman also organizes Data Bootcamps and Hackathons. At those gatherings, programmers, visual artists, data analysts and journalists get together to develop tools for media organizations.

Let me give you an example. Editors of Sudestada, an online investigative publication, joined a group of journalists and developers who attended the Data Bootcamp organized by Mariano Blejman in Montevideo, Uruguay, in March 2014. There, they developed Quien Paga, an app that helps track campaign finances.

Sudestada used Quien Paga to analyze campaign contributions in the 2009 presidential election. Private companies with government contracts are not allowed to make political donations, but Quien Paga uncovered two that did. After Sudestada published the story, the Transparency International Uruguay chapter filed a corruption complaint against the two companies (Puertas del Sur and Tenaris Global Service). The Electoral Court and the Anticorruption Board have launched an investigation.

HacksLabs also gave rise to Chequeado, a Buenos Aires digital media site dedicated to fact-checking statements by leading politicians and business executives. Chequeado has created a crowd-sourcing platform to obtain and fact-check data via social media. How does it work? A politician makes a statement and Chequeado asks the crowd to determine its accuracy. A group of experts, volunteering for Chequeado, help verify the results. Chequeado conducts live-fact-checking events where volunteer citizens, journalists and public policy experts get together to verify, fact by fact, the annual presidential report to the Nation, for example. Through awards, private grants and crowd-fundraising, Chequeado has increased its annual operating budget by 250 percent, from $80,000 in 2012 to more than $200,000 in 2014.

Another way we are incubating new projects is through contests. In 2012, Knight Fellow Justin Arenstein, launched the $1 million African News Innovation Challenge. The competition provides seed funding and mentoring for those with great ideas that improve Africa media.

From more than 500 applications, Arenstein and his team selected 40 finalists to attend an intensive boot camp in Zanzibar where they defended and refined their ideas before media, business and technology experts. After that, he and a team of international judges selected 20 teams to receive funding and mentoring.

Two years later, 18 of the 20 have met their benchmarks, received assistance and launched successful projects. Some are new news organizations, while others are startups that provide services to news organizations. But all of them have business plans to ensure that they are sustainable beyond the financial aid offered by ANIC.

Some examples:

FlashCast (Kenya) is a platform that beams hyper-local news to commuters in taxis and buses, using location-aware LED displays. Commuters can then use their mobile or other digital devices to engage in conversation about news items with viewers in other taxis and buses. FlashCast can poll commuters, start conversations, offer games and puzzles. A family planning poll, with 3 short surveys, received 4,325 SMS responses in 72 hours. By July 25, 2014, FlashCast had reached 7.5 million commuters and generated more than 6 million SMS “interactions” with commuters, in which people responded to the information they saw on the display.

News organizations such as the Radio Africa Group and The Star syndicate their content to FlashCast, and then share the advertising revenue. FlashCast also shares earnings with transportation companies, who have seen a boost in riders in buses and cabs with the service. FlashCast also sells advertising campaigns (which can also be location-based) at an average cost of $60 per campaign. After the service showed better audience engagement than radio or TV, two of Kenya’s three largest advertisers (Safaricom and Population Services International) signed up.

Code for South Africa embeds data scientists and programmers into newsrooms and civil society organizations to build open data platforms and applications. Launched in September 2013 through ANIC support, it is now completely self-sustained through its own consulting agreements to provide technology solutions to media and civil society organizations.

Code For South Africa, for example, created a database of drug prices in 14 African countries to help governments identify the most affordable medicines. Called the Medicine Prices Database (MPB), it already helped Botswana identify $10 million in potential savings.

It also developed an analytical tool called Dexter for an organization called Media Monitoring Africa that detects media reporting trends. Through its algorithms, Dexter showed that men outnumbered women as sources in election coverage by three to one and that for the first time, corruption was the major election issue. Arenstein and ICFJ have raised the funds for a second round of ANIC to be launched in 2015.

These are some of the programs ICFJ is running in Latin America and Africa to “incubate” new media organizations or services for media organizations. During our 30th anniversary year, this is another way in which ICFJ is placing itself at the forefront of the digital media revolution. Thank you.

Homepage slideshow image: CC-licensed, thanks to Daniel Tabas on Flickr.