04:12 AM

HubPages: A Different Kind Of Content Farm - Empowering Writers

The second largest privately held web site next to the Huffington Post is San Francisco based HubPages where "Hubbers" publish articles on a wide variety of topics and get paid through Google AdSense.

Some of the more popular Hubbers can earn more than a thousand dollars a month and they own their own content -- a different model from Demand Media, which commissions articles from more than 17,000 writers.

I recently met with HubPages' CEO Paul Edmondson. Here are some notes from our conversation:

- We set up HubPages in 2006 to help writers publish online and monetize their content. We have several tools that help writers create headlines that will be picked up by search engines, and help them put the right links into their copy.

- The founders are from Microsoft.

- We have more than 42 million unique visitors every month.

- We have had to be very patient. It's surprising how long it takes to build a media business. Fortunately, our investors have been patient.

- We have a ranking system for writers that examines how engaged they are with their readers and on the quality of their work. The higher the rank the more we promote their pages and the more they make.

- Content has to be original, we check that it hasn't been copied from somewhere else.

- No adult content is allowed.

- We've figured out a way to moderate at scale. We hire moderators and we also enable our readers to flag content and we will examine it and remove it if necessary. Some of our readers have a great track record in moderating content and we will remove content that they flag automatically.

- Most of authors are women in their 30s, and older men near retirement. We have more than 200,000 writers. We have the largest collection of poets online.

- Advertising rates seem to be holding up very well compared with December. That means our writers can make more money.

- We are profitable. We last raised money in 2008 (raised $2m initially then $6m in the most recent round) and don't need to raise any more at this time.

- Text, photos, and video are the killer combination to a successful HubPage. We have plans to host our own video platform because it will give us more control over advertising.

- We go around the country meeting with writers and teaching them how to be successful.

- Our "answers" section is nearly five times larger than Quora.

- We find that content reaches an earnings peak only after 30 months.

- We are a lean organization with 25 people, we plan to add engineers and moderators this year.

- Coming up, we will announce new ways writers can make more money.

Mr Edmondson recently wrote about the early days of HubPages:

A Start-up Story: Part 1 « iMediaConnection Blog

Our story is not unfamiliar. A couple of tech guys get together to create a media business. They start quietly, build a fair amount of momentum -- and then doubts set in. The business does not materialize at the pace we'd imagined. Our road map looks challenging. While we are growing and making money, neither of these things are happening quickly enough. Doubt is a dark place for anyone, but it's especially disturbing for an entrepreneur. Our plan was simple: get to two million US unique visitors, and sell 40% of our US inventory at a $12CPM.

Ten months after we started, my fears were killing me. I had previously told myself that it would be the fear of failure that would keep me focused and ultimately see me through. But, never before had my body broken out in raspberry patches along my rib cage - our business was taking longer to develop, and the symptoms were taking a toll on my health.

As they say, nothing ruins a good story like real data.

Now, five years later, Quantcast lists us as a top 50 website. We get 42 million unique visitors per month. Thank goodness for Adsense. Our business is thriving, costs are more than covered - the company is growing. But our goal had not been to just get traffic - we wanted to directly sell our ad inventory. Even now, our sell-through rate from direct sales is effectively zero. Our initial assumptions were wrong. We overestimated the effective CPMs and the percentage of inventory we are able to sell; we have been unable to build direct relationships with brand advertisers.

...our challenge today is to build a direct relationship with brand advertisers to reward our awesome community.