Why Cheddar Inc.?
Cheddar Inc. is just a three-year-old startup established in 2016. We could have chosen any other publishing behemoth for our next becoming story. But here’s why we wanted to cover Cheddar.
– Cheddar Inc is a quasi-CNBC channel and it means the publisher had to compete with the well-known business news network right from the start. Doesn’t it sound difficult and interesting at the same time?
– Surprisingly, the publishers relied primarily on licensing fees. That being said, it embarked programmatic advertising and sponsored events/ads after a year. The revenue is diversified as opposed to depending on any single source.
– Cheddar’s annual revenue hit $27M in a short span of 2.5 years (Src). That’s a growth we all would like to replicate. Without any further ado, let’s dive in.
How it all started?
Let’s start with Cheddar’s market approach.
A decade ago, if you want to know the days’ business news, you had to get a newspaper or had to check your TV.
Apparently, it’s a way to stay updated with daily news in the 2000s. But, the advent of OTT networks and channels like Netflix and Prime TV made the audience cut the cable-cords. Now, the young audience prefers things they can control – what time and where they want to watch, and how much they want to pay for a particular show.
Cheddar was well aware of the rapid media changes and found that such streaming services could be considered as an opportunity to reinvent live news for the audience. There were many media person who disliked the idea and said that the young audience doesn’t bother for live news about technology or business.
But the publisher disagreed and launched Cheddar that spoke to the people who care about what’s going on in the finance world. Initially, the publisher started from shooting an hour-long live video on phone in a day. After a few months, it went from streaming one hour a day to two hours and then three hours and it kept on expanding news coverage. It ran with just 4 employees and generated a revenue of $2.5M (Src). Thanks to founder’s successful track-record, Cheddar raised $3M in the same year (Src).
Where are they today?
It’s been three years since the launch of Cheddar and the cable-free video channel has already brought massive success for the publisher. The first video for an hour became live from the floor of the New York Stock Exchange (NYSE) in 2016. Now, the publisher broadcasts 16 hours a day covering a wide range of news from its own office “ChedSet 2.0”.
Over the three years, Cheddar has changed how finance and business news are created and consumed. Through live streaming news on OTT networks, Cheddar is reaching millions of readers across the globe. Cheddar has more than 200 employees and working with 20+ media partners including Hulu Live and Pluto (Src).
In addition, Cheddar reaches 6.5 million viewers/mo through its own properties, social media platforms, and OTT networks (Src). At present, the publisher has 3.9M+ Facebook followers, 268k+ YouTube subscribers, 594k+ Instagram Followers, and 224k+ Twitter followers.
Becoming Cheddar Inc.
From Zero to CNBC of the Internet
In January 2016, Jon Steinberg, Ex-president of BuzzFeed and Ex-CEO of Daily Mail, launched Cheddar Inc. Though Steinberg launched it, the term “Cheddar” was coined by Bryan Goldberg, Founder of Bustle.
“Cheddar is a post-cable TV network that uses modern cloud-based infrastructure to shoot, live stream, and stream the network.”
–Jon Steinberg (Src)
During its initial days, the video content for the channel was sent by the editors of Bustle, an American Women’s magazine. Every day, Bustle editors sent at least 10 articles to Steinberg who was the anchor of Cheddar at that time, shortlisted 3 to 4 articles to focus on for the day.
The next question came in the mind of Steinberg was, where to distribute the content and how to reach an audience?
At first, the publisher wanted to go for native advertising. But it couldn’t make it possible as Cheddar wasn’t well established and had no source of getting revenue at that time. Luckily, this was the time when Facebook Live came into light.
Steinberg knew Facebook has billions of users and thought it would be best for the channel to promote its video-content on Facebook since it would be a little bit cheaper than other modes of bringing traffic to the site.
So, Steinberg reached Facebook and streamed its first live-video of one hour on Cheddar.com and then, Facebook.
The startup received its first round of funding ($3M) from Lightspeed and Snapchat’s Jeremy Liew (Src). The amount received from this investment helped Cheddar to expand its reach, and make a bet on the channel.
The publisher added a separate section with a paywall that made users buy a subscription plan of $6.99/month to watch a full video-content program and dive deep. Although small clips were free for the visitors on Facebook, full-length content was available only for its paid subscribers.
A few months later, Lightspeed invested $10M for the second time in Cheddar along with Comcast Ventures and Ribbit Capital. It was Series B funding for Cheddar and helped the anchors of the news channel to introduce new programs.
Steinberg who was quite familiar with the content creation strategies knew that streaming HD-quality video would be expensive. So, the next question that came in front of the team was – how to create a workflow for video content with limited sources of revenue?
Thus, to sort out this, the publisher reached Live X, a cloud-based video technology platform; and Vimeo, InterActiveCorp’s video platform. Live X helped the publisher to design 4k+ video content clips with a one-time payment of $2,00,00. Besides this, Live X also helped the publisher to install new broadcast and streaming equipment for Cheddar studio on the floor of the NYSE building.
In the meantime, Vimeo’s On-Demand Publisher Network-enabled Cheddar to build its custom libraries for on-demand videos and upload its videos to Vimeo’s own page. In exchange, Cheddar paid 14% of received revenue from this platform to Vimeo (Src).
The publisher wanted to add extra money through advertising. So, by the start of 2016, Steinberg and the founder of Bustle came in an agreement for sponsored advertising to capitalize on the value of Cheddar. Under this deal, Cheddar posted a 30-minute show of Bustle on its own platform.
Fidelity, an investment company, is the next sponsored partner for the publisher (Src). The publisher integrated Fidelity’s mobile app into the shows and used its analyst ratings or other financial metrics as a source to analyze stock business parameters. (Src).
Note: Though Cheddar ran sponsored ads on its channels, it primarily focused on licensing its content and generating revenue from it. Of course, it turned its ship later.
Twitter Shows and Advertising
Steinberg was aware of the fact that Twitter is one of the fastest sources to know what’s happening around the globe, and has got positive comments from the agencies for its live-streaming video offerings. The social media giant allowed various formats of video advertising to generate revenue for the publishers.
By the fall of 2016, Cheddar joined the social media platform and started live streaming Cheddar’s two shows – Opening Bell and Closing Bell on a daily basis. The anchors of Cheddar covered CEO interviews and other breaking stories of the day.
By the end of the year, HP became Cheddar’s technology partner. Following this, the publisher added TV-style pre-roll and post-roll ads for HP in its videos posted on Twitter, and in exchange, the IT company helped the publisher to integrate its technologies for the advancement of studio equipment (Src).
Moving Beyond Web
The way Gen-Z encounter news has changed with the meteoric rise of mobile devices. Now, people prefer digestible content on hand-held devices.
To reach more audience, Steinberg launched a new Cheddar app for both Android and iPhone users. This app covered daily news in technology, entertainment, and media. But, only paid subscribers had access to the paywalled content available on the app (Src).
Acquisitions & Symbiotic Partnerships
The over-the-top finance TV channel declared StockStream as its first acquisition in the mid of 2017. StockStream delivered finance data statistics in real-time. The company enabled its users to vote on stocks that could be bought and sold in the market.
A year later, in 2018, Cheddar acquired daily newsletter Need2Know that had more than 3,50,000 daily US subscribers. The newsletter covered business, politics, sports, tech, environment, and other major events from all parts of the world. The publisher incorporated Need2Know into the Cheddar Big News network.
These acquisitions were done with the help of Series C Funding of Cheddar that was led by Raine Ventures. Raine Ventures along with other investors including Altice USA, AT&T, New York Stock Exchange, and Broadway Video invested $19M in the third round.
From OTT to Cable Television
Cheddar who had been identified as a cable-free network, came in partnership with Univision’s Fusion TV Network to extend its reach from live programming to cable programming. Though there were fewer users on cable-network these days, people still watched shows on television and the publisher wanted to try every possible way to reach as many people as possible.
So, the publisher started streaming finance programs on Fusion TV. Now, the audience who preferred to watch the news on television was also able to watch Cheddar news on the cable channel (Src).
Though the Cheddar earned from its distribution partners, it strategically forgoes revenue for reach. Instead of offering content at a substantial price like other news channels did; the publisher made a deal with Philo, a Live TV company, and asked no fee to put Cheddar’s sports content on Philo‘s platform.
The deal was a win-win condition for both as Philo was going through a shortage of business and sports content, and Cheddar wanted to make its presence on all MVPDs (Multichannel Video Programming Distributors) and increase its online presence among people.
“It’s not about a fee. It’s about our content is in a neighborhood—a clean, well-lighted place where people go looking for premium business news or primary news content.”
– Jon Steinberg
Facebook’s Watch Platform
Cheddar who has been using Facebook’s platform since its debut announced the launch of its new initiative Cheddar Live on Facebook’s Watch. Facebook’s Watch, exclusively known as a video-on-demand platform, enabled the publisher to broadcast its popular live or recorded videos (Src). Though it doesn’t make sense for news and text-rich publishers to lean on Facebook, it will work for Cheddar. Why?
To put it simply, the publisher wanted to brand itself and build a loyal audience base. This, in turn, could be leverage while licensing its content to other OTT/cable networks.
Local TV Networks
While some of the digital media companies were moving towards global markets, Cheddar took a different road and reached local news networks for expanding its audience reach. The step was shocking for other media companies. Why would a business news channel reach local networks?
But according to Steinberg, local news networks work better and faster to build an audience network than other OTT platforms. For this, the publisher reached KXTV, News 12 Network, and 6 other news platforms, and began airing Cheddar’s live video segments on the networks. Again, cable networks/local news channels are having millions of viewers (as the local channels are typically bundled together with other channels) and that means, Cheddar can get new immediate viewers from the existing audience base.
OTT and Platform Partnerships
Series D Funding
The publisher has received $22M as its Series D Funding from a group of 13 investors including NYSE, Goldman Sachs, Comcast Ventures, Amazon, and 9 other venture partners in mid-2018. According to the publisher, the funds received from its investment partners would be used to launch its second live news network and speed up the growth of Cheddar.
Following the recent investment, the publisher introduced Cheddar Big News and added Cheddar Daily Business News on Snapchat Discover Page for its users.
Initially, Cheddar has reached the audience and monetized the site through social media and sponsored advertising. Because it needed to justify why Cheddar’s content is worthy enough to license to OTT networks. Soon, the publisher joined Roku, an online media player. Roku enabled the publisher to add its live-news channel to Roku’s streaming player. Whoever had set up a Roku account was able to access Cheddar’s content.
By the end of 2018, Cheddar added fuboTV and Pluto TV to its distribution partner list which would stream most popular finance, entertainment, and sports shows of Cheddar on their channels. With this deal, Cheddar agreed to create content exclusively for fuboTV’s social media account. The 24-hour streaming channels of Pluto TV helped Cheddar Business to gather millions of views a month and growing revenue according to Steinberg (Src).
One of the biggest achievements for Cheddar viewers came in the mid of 2018 when the publisher came in partnership with Hulu. Hulu, an American OTT media service provider that has millions of subscribers helped the publisher to expand its audience reach through its platform. Hulu users who weren’t familiar with business news streamed by Cheddar, this deal made them watch publisher’s live news.
A year later in 2018, the publisher introduced Cheddar Esports on Twitch’s video platform (Src).
The Twitch feed of Cheddar would stream live content from 9 am to 12 pm (Src). Besides, it would come with a chat capability that enabled viewers to interact with the system in real-time.
Since the day of its launch, the publisher has never stopped to discover ways to reach the younger audience. In this direction, Cheddar acquired Viacom’s MTV Networks On Campus Inc. and used its distribution platform to launch CheddarU. CheddarU is a financial-news streaming service which is exclusively created for college students.
Cheddar landed the digital book rental company Chegg, and Music service provider Pandora as launch sponsors (Src). Chegg enabled the publisher to focus on various educational services and personal development, and Pandora helped the publisher to cover music charts and artists to engage the audience.
By the third quarter of 2018, CheddarU started streaming live technology updates, startup stories, and other headline news. The publisher expected to reach 9M students over 600 campuses via 1600 screens. Steinberg said that the qualifying university students can access CheddarU at free cost by signing up with their .edu mail address (Src).
After running with partnerships and licensing, the publisher decided to try out programmatic. Cheddar signed a contract with Telaria, an SSP. Under this agreement, the publisher said that it would use Telaria’s video management platform to enhance its programmatic advertising (Src). By this, Cheddar would make its advertisers buy publisher’s live inventory for the first time. Telaria also comes with an in-built CTV (Connected TV) Video Management Platform that would help the publisher to create revenue-generating decisions with real-time diagnostics and live reporting.
As the publisher has only the video content, it makes sense for Cheddar to avoid the usual programmatic setup. That’s why you wouldn’t find 10+ demand partners competing to run ads. Besides, the publisher isn’t using its own property to reach the audience. Of 6 million+, just half-a-million are viewing the content on cheddar.com (web) and the apps don’t have tens of thousands of downloads as other news publishers.
Since its launch, the video-centric media company has established itself as a reliable source for streaming professional business/tech content – 24×7 from any device.
Recently, Steinberg has sold Cheddar to Altice USA for $200M. According to him, this acquisition will help the channel to improve its programmatic advertising offerings. The publisher is working on other Cheddar channels to replace business-focussed TV channels like FOX News or CNN and become the future of live television. As you could see, a video publisher, indeed, can reach millions of people every month over tens of platforms and most importantly, generate revenue from it. If you would like to grow your viewers or scale up the video content, Cheddar is the right example to follow.
However, relying on other platforms (cough…Facebook..cough) is quite risky. It worked for Cheddar so far, but we’ve yet to see the actual revenue it made from Facebook properties. Also, diversifying from licensing to programmatic is an unexpected move that could reap impressive results for the publisher. After all, it has the audience and instead of letting other platforms to sell its inventories, Cheddar can do it with an SSP – No middlemen and better relationships with advertisers.