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16 March 2022
Lessons in profitable, hyper-local growth
Media & publishing (general)Brand managementUnited States
6AM City is a newsletter with a hyper-local remit for each of its 24 American cities that rapidly expanded last summer, according to a new interview: here’s what you need to know.
Why it matters
Process is arguably more important than product – just look at Amazon. Even at a small firm level, building good documentation of what works cuts down doubt, costs, and time to train new staff.
What’s going on?
Speaking to What’s New In Publishing’s Media Voices Podcast, Ryan Heafy, co-founder and COO of the US company explained the ingredients of its success.
Process. The firm focused on these critical questions early on: “How do we do this? What does it look like? How can we scale and replicate this over and over again?”
By recording these processes fully and building playbooks, the company cuts down the time that existing team members need to dedicate to training new recruits.
Growth with solid foundations is better than growth for the sake of growth. The company paused expansion and worked on perfecting process throughout the lockdowns of 2020 and 2021 before expanding rapidly in July by launching newsletters in 16 new cities and growing to a million subscribers up from 300,000.
Design for profitability. With low headcounts and playbooks in place, newsletters tend to break even in year one, and reach a 75% profit margin by year three.
Variable advertising. The company enjoys a 70:30 rate of local to national advertisers, who use automated and bespoke advertising services, respectively.
“We’ve really honed our craft. We put more funding and resources into growing our audience faster, we’ve identified channels to help expedite that. So in some of our new cities, which might be three months old, and have 50,000 subscribers.
“It used to take us six months to get business. Now we’re generating revenue on day zero” – Ryan Heafy, COO and co-founder, 6AM City.