By now, most people in the media and fashion worlds have heard of Refinery29, a media startup valued at nearly $300 million.
But for a long time, the startup's struggle was very real.
The site was launched in 2005 by Philippe von Borries and Justin Stefano. At that time, there was no Facebook, Pinterest, or Twitter to flood websites with readers.
There was no Buzzfeed or even a notion of viral content. And there certainly were no investors looking to throw gobs of cash at media founders like von Borries.
Eleven years later, the state of digital media is very different. Refinery29 is one of a few leaders in the space that has tens of millions of readers and a sky-high valuation. On its site, Refinery29 attracts about 25 million monthly uniques. But across the web — like on Facebook and Snapchat — its content (mostly video) is seen by more than 175 million people each month. In 2015, Refinery29 say its audience grew more than 150% in terms of content views.
We sat down with von Borries at the South by Southwest conference in Austin, Texas, last weekend.
Here's a lightly edited Q&A on the state of digital media, from a man who helped launch the industry.
Alyson Shontell: You guys have been in media since before it was cool, and nobody would give media startups money.
Philippe von Borries: Nobody even looked at it as a space that mattered, where you could make money.
Shontell: “Advertising is a terrible business,” they’d say.
von Borries: Yeah it was like, “Where's this gonna go, is this your hobby?" People asked for the first few years, "So what do you do when you don't do this?”
It was like, 'Where's this gonna go, is this your hobby?'
Shontell: Before you were running a media company, what were you doing?
von Borries: Justin [my cofounder] was investigating cops for the city of New York. He was carrying a badge and driving into outer boroughs. And I was working in media, for a political startup in DC. But neither of us were properly in New York City media, and neither of us were in the world of style or fashion in any way.
Shontell: How has the perception of digital-media businesses changed since you launched Refinery?
von Borries: When we first launched, the media-startup space didn't even properly exist. Then, the things that we looked at were Gawker and Gothamist as being at the forefront of media. You didn't have any of the big audience aggregators, or platforms that actually let you build scale.
So we went around with clipboards to stores signing people up for our site. And we'd high-five each other when Cool Hunting would pick up a story that we had written. That was the moment, you know? And we would be collecting email addresses to get people back to the site.
Of course the VC industry was fairly nonexistent. Union Square Ventures had just recently launched, and they were one of the first in New York to give people money, but that was it.
Over time, stuff started to accelerate and the shapes started to emerge in and around the ecosystem with The Huffington Post probably being the first to build a huge audience.
Shontell: What was it like pitching investors back then?
von Borries: Oh my god, there were so many instances of us going to meetings where people just didn't get it. People were like, "Content? I'm out. I don't want to touch it."
People were like, 'Content? I'm out, I don't want to touch it.'
Everybody was obsessed with commerce, and it wasn't until 2010 or 2011 when you could start to build audiences up. Facebook gained traction. Twitter gained traction. The community started to sort of proliferate, and I think people started to see the contours of digital brands emerge.
Traditional media companies certainly didn't, but I think people in the VC space started to make some bets. And so around 2010 or 2011 was when things started to gain traction for us. That's when we got our first proper seed round, where we raised $500,000 from some really influential New York angels.
Shontell: And now?
von Borries: The competition has never been greater. There's a ton of noise, and there are new players entering the space at any given moment. My hypothesis is that we're living in an age where the future iconic digital brands are being formed.
Only a few will win in the space. Business Insider has, Vice obviously has broken out, and I would argue that we've absolutely broken out.
But there's a ton of competition right now and talent wars. Everybody is still sitting on a fair amount of cash from previous [funding] rounds. Nobody knows quite what's happening with the macro economy, but there's still a lot of money out there. So there's still a high degree of frenzy around media right now.
Shontell: I recently spoke with the founder of Bustle, who said he just raised "the most over-subscribed round of his career." Is that normal right now in media?
von Borries: I love [Bustle CEO] Bryan, but I don't think it's as easy to raise money anymore. I think the VCs have largely bowed out of the space.
What you do have is a lot of the strategic [investors and legacy media brands] putting their vote of confidence into digital, because they realize that they slept on it for 10 years and they need to make investments, acquisitions, and bring that knowledge, that culture in-house. So financial institutions are out. Traditional and strategics are leaning in. Consolidation is happening now.
Shontell: Define "strategics."
von Borries: Well, you see it with Time Inc. as an example. So they've made a bunch of acquisitions, and they've made investments. Hearst — a ton of acquisitions, a ton of investments. Conde even, right? Scripps [invested] in our case. So a lot of the traditional media companies began realizing they kind of slept on the opportunity. They don't have the digital culture internally, and they're finding out that the only way to really disrupt themselves is by either investing or by acquiring companies in the space.
A lot of the traditional media companies began realizing they kind of slept on the opportunity, and they don't have the digital culture internally.
Shontell: The media landscape is changing really quickly, between the push toward native content on platforms like Facebook and everyone focusing on video content. How do you keep up with the constantly changing environment?
von Borries: Facebook and Google are on their own paths of creating closed experiences where they give their users the best and fastest experiences. That's why Google Amp (Accelerated Mobile Pages) — which we have up and running, and it's amazing by the way — and Facebook Instant Articles are just the trends that no one's going to turn the tide back on.
They're here to stay and what's happening is all the channels through which most of your traffic is being delivered are going through large platforms.
But I will say this — I think Facebook and Google and all the other platforms need great partnerships with premium content providers. Just as much as we need great relationships with their platforms. And so I think there's a symbiotic relationship.
Facebook and Google need great partnerships with premium content providers. Just as much as we need great relationships with their platforms. I think there's a symbiotic relationship.
You can't get too caught up in thinking about, "What does it mean for Google now to be delivering the majority of my content through Amp?" It's faster, and it's a lot better for the consumer.
Shontell: How does Google Amp work?
von Borries: It gives you basically a parity experience. It's a cached version of a publisher's page and it's a lot faster.
Shontell: What results are you seeing from Google Amp so far?
von Borries: Google Amp was delivering a lot of traffic for the first two weeks we went live with it, because Google was also promoting it. It was driving a massive spike … in terms our daily average Google traffic, it probably went up by 20%.
Shontell: How's Snapchat Discover going for you?
von Borries: Discover is going amazingly well. The audience is incredible in terms of size, and it forces you to innovate in ways that are very unique to the platform. We have a relatively large team that does nothing but content for Snapchat.
Shontell: What's Refinery's Snapchat strategy?
von Borries: The strategy is to do everything that we're doing on Refinery, but in more original ways. Taking what we're known for — which is style, beauty, pop culture, news, and important global issues — and wrapping it into an experience that is 10 stories long and developing it for a new audience.
Shontell: So which is the dominant platform, Facebook Instant, Google Amp or Snapchat Discover?
von Borries: All three of those are so huge. I think anyone who's in the space right now looks at five or six platforms that they develop teams around — Facebook, YouTube, Twitter, Snapchat, Google.
Shontell: How do you decide which platforms to focus on? There are new ones launching all the time.
von Borries: One thing we're really good at internally is handing the keys to people to try new platforms that may or may not get big. Peach, Periscope, YouNow. Facebook Live.
So we say to employees, "Hey, you're an up-and-comer in the company and you love this new platform. Why don't you try it out?" With Refinery29's YouNow [live-video channel], four of five kids in the company were excited about it, and they were shooting videos in the kitchen at 7:30 a.m. They just did it. We placed our vote of confidence in them and let them do it with the Refinery29 brand.
I think live video is going to be the next big thing. Facebook is going to push it even more crazily than it already is. With regards to how to you know what to pursue and what not to pursue, it's the cultural thing. When you see things breaking out, then you start to invest in it more, Live being a great example of that.
Shontell: Let's talk more about digital video. How do you see that whole trend shaking out?
von Borries: I think the world rewards risk-takers and early adopters, and that's been our motto with video.
The world rewards risk takers and early adopters, and that's been our motto with video.
We've been doing video for eight years, but we got into it super heavily about two years ago.
We're doing everything from 360 video — which we just did a whole thing around during fashion week — to VR, where we're placing a lot of bets and have been producing content from around the world, including partnerships with Samsung.
We're also doing the scale stuff, so short-form on Facebook and with YouTube. And then we're also focused on impact work. At Sundance we did two projects: One was Shatterbox Anthology, which was about increasing the number of female directors and we were releasing one short film every month. Two was The Skinny, which is an amazing short-form web series that we coproduced with Jill Soloway. And those were about impact and creating work that has a ripple effect.
I think right now is the time where we have to triply focus on the commercial side of digital video. But you also have to take bets. And there's so much momentum right now in the space that you can't sleep on opportunities.
Shontell: It has to be difficult to keep reinventing Refinery29 as all these new trends pop up. It seems like, as a media CEO, you can never just coast.
von Borries: If you look back a year ago, we weren't planning for Snapchat Discover because it hadn't launched yet. Facebook video wasn't really a thing yet.
When I think about where we were in 2011 when we raised our seed round, we were producing content for the web and for an email audience. And look at where we are now, it's totally profound!
It's exciting, and you just have to be all in it. It's actually never been as exciting as it is now.