Wanderful Media raises $9 million more in funding from its newspaper investment partners
Just four months ago Wanderful Media, the Los Gatos digital local discovery shopping company, announced that it had added $5 million in new funding. Today, the company acquired iCircular in November, announced that it had raised an additional $9 million. The new round of funding brings its total up to $36 million.
The company which hopes to find a way to save the circulars business for newspapers is backed by 12 major newspaper companies: Advance, Belo, Community Newspaper Holdings Inc., Cox Media Group, The E. W. Scripps Company, Gannett, GateHouse, Hearst Corporation, Lee Enterprises, MediaNews Group, McClatchy, and The Washington Post Co.
Wanderful Media’s CEO is Ben. T. Smith, IV, a veteran Silicon Valley entrepreneur, who was the founder of MerchantCircle (the COO comes from that start-up, as well).
Whether this is just more money circling the drain is to be seen, but the investments by major newspaper companies does follow a pattern whereby newspaper execs outsource their digital media solutions rather than build them in-house. In the print world, newspapers generally eschew any solutions that need outside vendors to succeed. They may not build their own printing presses but they spend millions making sure they are housed, maintained and operated by their own personnel.
In digital, however, newspaper companies have invested in outside firms in attempts to drive classified advertising – with the result, of course, that the category has almost completely disappeared. Worse, the financial commitments made have tied the hands of newspaper executives that would normally have been more aggressive in finding their own digital advertising solutions.
For many newspaper companies, the circular is one of the last profitable advertising segments they possess, the reason many still subscribe to the Sunday newspaper. Last November iCircular, the company many hoped would save the category, and an A.P. initiative, was acquired by Wanderful Media for “less than eight figures” (though that would still represent a large portion of Wanderful Media’s own funding). Wanderful had previously bought a print to digital conversion company located in Chico, where it still maintains its development and operations office.
Wanderful’s own product is called Find & Save, which for now is a web-based solution found on such newspaper websites as the San Francisco Chronicle. The company says its next move is to bring the solution to mobile and tablet devices where geolocation and push notification services can be employed.