Welcome to The Publisher Newsletter, by Media Voices. Thinking of entering this year’s Publisher Newsletter or Publisher Podcast Awards? Join our (free) Masterclass on how to write an award-winning entry.

In a media world increasingly dominated by AI content and tech giants, Memberful empowers publishers of every size to reclaim control of their voice and earn sustainable, recurring revenue. 

Whether you're an independent journalist, local newsroom, or legacy publisher, Memberful offers the tools to connect with your audience and build a membership business on your terms. Offer exclusive content, premium podcasts, or private community forums — all seamlessly integrated into your existing website and platforms.

With Memberful, you retain full control of your brand, audience, and content while simplifying payments, renewals, and content protection.

Focus on telling great stories — let Memberful handle the rest.

When should you take – or not take – VC funding for a new media business? The slow-growth philosophy of 1440

Venture Capital (VC) funding has helped to launch some of the most successful media brands of our time. But, as newsletter-based media business 1440 demonstrates, there are still benefits to avoiding VC and building something more sustainable, more slowly.

Tim Huelskamp is a rare breed – a man who spent years in the world of venture capital, whose new mission is a journalistic one. 

That provides him with a relatively rarefied vantage point, as a person who can see when VC funding works as a springboard for successful media businesses. Perhaps more importantly, however, it allows him the perspective necessary to spot when it doesn’t work, and why.

Speaking to The Publisher Podcast in his role as co-founder and CEO of newsletter-based media business 1440, Tim was keen to point out that there are success stories of publishers who have taken VC funding. He cites Axios, Industry Dive and Politico as examples noting that “some VCs definitely made some good money in this space”.

It’s a reality of digital publishing that achieving large audiences is rewarded with advertising money. VC funding provides the necessary resources to speedrun that process, through marketing and growing headcount. It effectively lets a media business skip the arduous process of starting small, instead launching it into the big leagues right from the off. It’s a system that works well for media businesses with a clearly-defined USP that can sustain that growth once that initial glurge of spending has run out. 

But at some point, you have to pay the piper. VC funders require their return on investment – and sustaining growth is easier said than done.

When to seek funding

So it’s interesting that, despite his background, Huelskamp’s venture has not received VC funding, instead opting for a slower approach that could ensure more stability in the long term. That was in part due to a philosophy of building for decades, not days, but it was also down to VC funders not necessarily seeing 1440 as a business that would particularly benefit from that huge upfront injection of cash.

He explained: “It was actually a blessing in disguise, because we went out to try to raise a little bit of venture capital, and we heard from the market that ‘this isn't for us’.

“I would hope that we would have been disciplined anyway, but it made it easier to be more disciplined when you don't have that rocket fuel VC behind you. That sometimes makes companies think short-term versus long-term.”

He believes that media businesses have tended to overextend themselves over the past decade or more:

“So if you raise rounds at the right time, you don't overspend, you grow at the right clip, you get billion dollar valuations and IPOs and the employees win, the founders win, the investors win. It's a really beautiful thing.

“I think it's largely the exception, not the rule, though, just by [virtue of the] design of venture capital.”

Build slow, build strong

Instead, 1440 is adhering to a slower but more secure philosophy of expansion. It goes back to a growth strategy that Tim believes works better for media business. Citing Warren Buffett, he said that it’s important for media businesses – and their founders – to build with the intention of being around for decades, rather than seeking swift growth and a quick exit. That’s where the familiar troubles around overpromising, and the catastrophic layoffs and closures, begin.

For 1440, that means prioritising what it does well, rather than succumbing to what Tim calls “shiny object syndrome”. Its core product is a daily newsletter that seeks to curate news for the ‘intellectually curious’ from an ‘unbiased’ perspective. As with the best businesses, that approach was born from Huelskamp’s own pain points. He and his co-founder struggled to find a news source that worked for their interests and schedules. To date it has signed up over 4 million daily readers, suggesting that others were experiencing the same issue.

But rather than chasing trends, Tim said that 1440 is launching products with a more considered approach, building upon what already works. Their latest product, Topics, is an extension of the curation approach that has served the team well with its core newsletter.

Topics launched at the end of October, as Tim explained: “This has come from a ton of feedback from our readers. What we hear from our readers is that… there's all these topics that come up and folks want to learn about them, and then they go try to learn about them, and they have really a bad experience. 

“They might go to a search engine and they type it in, and they just get all that clickbait that actually doesn't provide a lot of value. So that's our new [product]. You can go to this environment if you wanted to learn about a topic, and in that topic are the best curated resources from all over the internet with a summarization that we do – 1440 – style that helps you understand it.”

It isn’t reinventing the wheel, but as Tim noted, it’s better to have a product that doesn’t stray too far from the USP provided it still adds value to your audience.

Beholden to no one

One of the biggest benefits of not having taken VC funding is that you do not have to answer to shareholders. It really cannot be overstated how much of a bonus that is – not just for the owners, but for the employees that choose to work for the media business. 

Like other digital start-ups such as Defector, 1440 is employee-owned. Tim explains: “We have the very rare privilege that if we want to launch a product, and it makes sense, and we all believe in it, we can go launch that product. If you're backed with investors, your board can just tell you ‘No, go back to doing that thing, or do this thing we want to do. So it's a wonderful luxury we have.”

That ability to focus on what works for your core readers rather than the need to chase enormous audiences at scale has also allowed 1440 to neatly sidestep another of the biggest issues with digital publishing: the tech giants. Tim acknowledges that the suite of advertising and targeting tools offered by Meta, Google, and Amazon are incredibly powerful, and do work for the advertisers and publishers that choose to use them.

However, he believes that by concentrating on that core newsletter product, 1440 has been able to build partnerships with a stable of advertisers and brands that appreciate the direct relationship they have with readers. 

It all hearkens back to good old publishing strategies, unmoored from the demands of digital ecosystems. As Tim explains, VC funding can and has worked for many media companies. But the demand from investors for ‘decacorns’, for companies that deliver ten times the returns within a few short years, is often anathema to the slow-growth philosophies of old-school media businesses. 

“I will say, for the folks starting their own businesses, if you can't imagine yourself working on the project for about a decade, you probably shouldn't do it,” Tim advised. “And usually the only times you can do that is if you genuinely love what you're doing.”

This season of The Publisher Podcast & Newsletter is sponsored by Memberful, a best-in-class membership solution for independent publishers and journalists who want to diversify their revenue streams and connect with their audience.

Memberful lets you offer membership perks and exclusive content to your loyal audience, giving you full control over who has access to your articles, newsletters, podcast episodes, private community chats, and more.

Take control of your publishing business this year with Memberful.

More good reads from the week: