About three months back I predicted that Medium would pivot for the fourth time and/or take a buyout offer within a couple years (if it doesn’t go bankrupt first).
I should have been more bold with the time frame.
Medium founder Ev Williams just announced that the startup has fired a third of its staff, “eliminating 50 jobs, mostly in sales, support, and other business functions”. The startup hasn’t found a way to make money selling ads:
We set out to build a better publishing platform — one that allowed anyone to offer their stories and ideas to the world and that helped the great ones rise to the top. In 2016, we made big investments in teams and technology aimed at attracting and migrating commercial publishers to Medium. And in order to get these publishers paid, we built out and started selling our first ad products. This strategy worked in terms of driving growth, as well as improving the volume and consistency of great content. Some of the web’s best publishers are now on Medium, and we’re happy to work with them every day. We also saw interest from many big brands and promising results from several content marketing campaigns on the platform.
Upon further reflection, it’s clear that the broken system is ad-driven media on the internet. It simply doesn’t serve people. In fact, it’s not designed to. The vast majority of articles, videos, and other “content” we all consume on a daily basis is paid for — directly or indirectly — by corporations who are funding it in order to advance their goals. And it is measured, amplified, and rewarded based on its ability to do that. Period. As a result, we get…well, what we get. And it’s getting worse.
That’s a big part of why we are making this change today.
So, we are shifting our resources and attention to defining a new model for writers and creators to be rewarded, based on the value they’re creating for people. And toward building a transformational product for curious humans who want to get smarter about the world every day.
I would like to say I told you so, but honestly was there anyone who didn’t see this coming?
Medium has been a pipedream from the beginning, and was propped up by an extensive hype machine. It started out as a vague desire to “fix” the internet but never figured out how to pull it off.
The startup has never really progressed beyond aspiring to that altruistic goal.
It is the Underpants Gnome of web startups.For those who haven’t heard the term before, Underpants Gnomes were creatures from the second season of Southpark who went around stealing undergarments as the first stage in a 3-step business plan. Unfortunately for the gnomes, they never did figure out what to do in the second step:
Like those Southpark characters, Medium knows what it wants to accomplish. It wants to fix the internet by creating a platform where great content is promoted and great ideas come to the fore.
And it has achieved the first step; it raised $134 million in capital, developed a platform, and started publishing.
But after five years it has yet to figure out step two.
To be fair, Medium is not the first startup to struggle with finding a profitable business model; that is the norm rather than the exception. But most startups don’t have such lofty goals, and most startups figure out their business model doesn’t work faster than Medium, which has taken five years and counting.
Let’s hope that Medium finds a solution before the money runs out, or at least finds a buyer. Otherwise when Medium goes down it is going to take a lot of personal blogs as well as blogs like Pacific Standard, The Awl, and ThinkProgress.org down with them.