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Summary:

Backfence, the once-hyped citizen journalism startup, is closing all its 13 local sites, after a series of management troubles over the last…

Backfence, the once-hyped citizen journalism startup, is closing all its 13 local sites, after a series of management troubles over the last year, and inability to get any local traction editorially. CEO Mark Potts has also left, and told me in an e-mail that the investors are “continuing to talk to potential buyers or new investors, but have decided for business and operational reasons to shut down the sites rather than operate them without sufficient support.” Though the notice on the local sites say otherwise at this point: “The people behind Backfence still believe strongly in the need for community information services, and we hope to apply all that we’ve learned from our experience here to new endeavors in the future.” So for all intents and purposes, the venture is dead.

The startup received $3 million funding in 2005 from SAS Investors and Omidyar Network, among others, and quickly opened local sites in Virginia and DC area, and then later bought the remains of a Bay Area local journalism effort.

AJR has a long story in its latest issue about the failure of Backfence, and the larger issue surrounding hyperlocal journalism: “The failure of Backfence may offer no greater lesson than the old one about pioneers being the ones with arrows in their backs. New ventures fail all the time. But it could also sound a cautionary note about the present–and immediate future–of hyperlocal news sites. As big-media companies and entrepreneurs alike rush into the hyperlocal arena, it’s worth pausing and asking: Is there a real business in this kind of business?”

  1. invitedmedia Friday, July 6, 2007

    i would argue that there is a huge business at the "hyper"local level.

    the problem may be that most of these efforts tend to be very top heavy.

    how many garages or basements could you rent for the same $ you'd pay one senior vp- let alone 10?

    sorry to hear about backfence.

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  2. As a pure-play first-mover, Backfence taught us all a lot about how not to do hyper-local. Hyper-local is about utility and networks of people, not citizen journalism.

    See the existing 72,000+ public 'neighborhood' Yahoo Groups (and who knows how many private groups) and the fast growing Facebook Regional networks as proof points of scalable hyper-local models…and the focus of these services isn't even hyper-local!

    Whoever figures this space out will win BIG and capture a share of a 'homeowners/residents' time spent online, which could be equal to or even greater then the incredible per user per month figures Facebook currently generates.

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  3. Excellent points by Invited and Tim above. I wonder if Backfence (which I'd never heard of until now even though I'm interested in this niche) failed because they approached the problem from the top down rather than working to organize and shape existing natural local networks and chatter? There's a *world* of citizen journalists who will work for the sake of their city/cause/idea. Were they involved here? I don't think so.

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  4. i would argue that there is a huge business at the “hyper"local level

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  5. Jonathan Weber (of Industry Standard fame) has a Community Journalism FAQ (http://www.newwest.net/index.php/main/article/the_newwestnet_faq_for_online_community_journalism_enterpreneurs/) that is instructive for this situation. Running a mildly profitable hyper-local site myself (and having been a part of Microsoft's Sidewalk where lots of money was hemorrhaged), it's all about keeping the burn rate low while finding something that is compelling for your audience. In 18 months, we've built a larger audience than the local newspaper's website or print product so it can be done.

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  6. Sorry to hear that. (I guess I'm a little late.)

    Been working on my own project – for over two years now – with no funding.

    http://www.MuncieFreePress.com

    We're still growing – revenue, visitors, pageviews, content submitted …

    K. Paul Mallasch – Publisher
    http://www.kpaulmedia.com

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  7. i think there is a huge business at the “hyper"local level. But is hard to subscribe for some of them, …like backfence.com

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  8. We need more quality journalism. I think they should give it a go once again

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  9. when someone says “where are continuing to talk to potential buyers or new investors but we are going to shut down hoping to use what we have learnt in the future”, that future never arrives.

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