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Boredom led this ex-reporter to start Southeast Asia’s hottest hyperlocal news company

Navratri Hindu

The Navratri Hindu festival in Bangkok. Photo: Alexander Hotz for Coconuts.

Before Byron Perry founded Coconuts, the rapidly growing Asian community news site with one million monthly unique visitors, he was a perpetually bored journalist.

After moving to Los Angeles in 2007 to work as a copy editor at Variety magazine, the American found that the entertainment business wasn’t his calling despite opportunities to attend film premieres and interview celebrities.

Then there was the matter of print publications struggling. Variety saw its print ad revenues drop, and had to lay off 30 percent of its staff – including Perry, who was one of the youngest employees there. He took his severance package and traveled around the world, landing in Southeast Asia and a gig as an English language reporter at the Phnom Penh Post in Cambodia. That didn’t last long.

The job wasn’t boring, but the town was. I rode around in a bicycle covering the latest news in Siem Reap, or a new coffeeshop, or a new construction in town.

He then moved on to cover real estate in Thailand, but again, property wasn’t something he liked. This led to the thought of starting his own news website, since he felt there wasn’t a good urban news website in Bangkok.

Starting in September 2011, Perry bootstrapped Coconuts out of his Bangkok apartment for about a year.

I had to write nearly all the articles myself, with some help from freelancers.

He got some reprieve after receiving funding from angel investors in Silicon Valley. The money gave him a welcomed cushion to focus on readership growth and the business aspects.

Cure for boredom

The closest analogue to Coconuts is perhaps Gothamist, the company best known for its city blogs in places like New York City, Los Angeles, and even Shanghai.

Essentially, Coconuts focuses on hyperlocal news in Southeast Asian cities. While this could, in theory, mean covering events like the opening of a local photocopy shop that have no relevance outside of its immediate vicinity, Perry wants to find unusual happenings that can go viral globally. It does both original articles and content aggregation by scouring for stuff on social networks.

Given its hyperlocal coverage and business model, the site needs to expand rapidly, especially in the early stages. Coconuts wants to be a pioneer of sponsored content in Asia, which differs from advertorials in that publications take full control over content which sponsors pay a sum to be associated with. It’s something that Buzzfeed and Vice magazine have run with and are succeeding.

For the sums to work out, it needs lots of traffic. To do that, it must have boots on the ground in multiple cities to scour for content and capture readers. So, it launched in Manila in November 2012, then expanded to Singapore in August 2013. One month later, it launched a Hong Kong site.

By the first quarter of 2014, it aims to expand to Kuala Lumpur, Malaysia and Jakarta, Indonesia. Beyond that, the big cities in India, with sizable English-speaking populations that are still print-oriented, could be attractive targets.

Making new media profitable

Turning from a journalist into an entrepreneur was challenging, and Perry had to focus more on the business aspects of Coconuts than editorial. He also has to grapple with hiring and firing.

Some hires didn’t work out. I had editors that looked good on paper but didn’t turn out great. From that, I’ve learned that it’s important to put someone to the test first if that role you’re hiring for is going to be extremely important.

2014 could be a make-or-break year for Coconuts. With limited angel funding, Perry is turning his eyes towards monetization, and he intends to hire a sales team to help him break even.

While sponsored content is starting to get traction in the United States, it’s still new in Asia, which means Coconuts will have the arduous task of convincing brands about the concept. So far, the company has one campaign going, and it’s hoping for more in the coming months.

It’s also gone into traditional banner ads and advertorials, and in the near future it could explore a classifieds section which charges for premium placing.

Another area Perry is concerned about is political content, given the differences in political environments in various cities. While Manila generally respects press freedom, Coconuts is aiming to be “110 percent” neutral in Bangkok and avoiding political coverage entirely in Singapore, given the government’s concerns about foreigners influencing local politics.

While unable to comment on his dealings with authorities, Perry says:

I believe in freedom of media and free speech, but I will abide by all legal requirements in every single market.

Coconuts, Coconuts everywhere

Traffic-wise, Coconuts Manila is leading the way, followed by Bangkok and then Singapore. One million uniques in November 2013 is respectable growth for a site with a full-time headcount of 12, considering it only had about 50,000 uniques a month in the first year. It’s roughly what Buzzfeed and Huffington Post got at around the same time post-launch, although Upworthy has been deemed the new king of viral media with 5.5 million monthly uniques after one year.

coconuts-millionviews2

Coconuts announcing its milestone.

Viral content has indeed been instrumental in helping Coconuts gain mainstream traction, and its Manila site in particular has been especially successful. Perry boils it down to the population’s familiarity with the English language, love for social media, vibrant media scene, and a large population of 25 million. These are factors that have also helped another news startup, Rappler, succeed.

One of Coconuts’ most well-read series has come from the Philippines. It’s a repost of a short two-minute video, about an American who helped an old Filipino lady get to safety after the devastating typhoon Yolanda.

While that post got 2,200 likes, it paled in comparison to what happened next. It turned out that the American is a storm chaser who was in the country to document the ‘super typhoon’. Coconuts got a hold of him, and followed up with a full-length interview accompanied by a 12-minute video showing what happened on the morning of the rescue. That post received 11,000 likes.

In the age of viral media, there’s something to be said about how the media is degenerating into a battle for likes and retweets. Coconuts is a participant in that for sure, its name, after all, is something of a shorthand for ‘content that goes nuts’.

But it’s also aiming for something different. Byron says:

We want a mixture of high-brow and low-brow content, original reporting along with cat photos.

(Editing by Josh Horwitz)


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