Punchbowl News reaches deal to buy data startup

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Since leaving Politico three years ago, the founders of Washington news startup Punchbowl News have made their mark with aggressive coverage inside the Beltway, breaking news on the Capitol riot, the chaotic impeachment of the President Kevin McCarthy and the death of the senator. Dianne Feinstein of California.

Now, they're opening a new avenue to reach political obsessives by acquiring a new company that tracks legislation moving through Congress.

Punchbowl News said on Thursday it was acquiring Electo Analytics, a company that provides data to help decipher and analyze legislation. The stock deal values ​​Punchbowl News at more than $100 million, according to two people familiar with the transaction.

The deal is a sign of an increasingly popular approach among digital news startups. Instead of trying to cover the entire world and relying on advertising, media outlets focus on narrow swaths of coverage that people are willing to pay for.

“Business publishing for the digital age is up-to-date, delivered to you immediately, and gives you something you wouldn't otherwise know,” said Ken Doctor, media analyst and entrepreneur. “It's usually a combination of really important data, breaking news and interpretation.”

Jake Sherman, Anna Palmer, John Bresnahan and Rachel Schindler, the Politico alumni who co-founded Punchbowl News, planned from the beginning to offer data as part of a pitch to subscribers, who pay $300 a year for membership, Ms. said. .Palmer. , 41, CEO of Punchbowl. The new company, named after the Secret Service code name for the Capitol building, has been in talks with Electo Analytics since this summer, negotiating the broad aspects of the deal over a dinner over Labor Day weekend. Palmer said.

Punchbowl News is betting that the finer details of lawmaking will be a major selling point for its readers, which Sherman said include senators, congressional representatives and their aides. The company, which has a website and three daily email blasts, also recently started a text-messaging service that gives die-hard users an urgent look at the news. (“DIANNE FEINSTEIN HAS DIED AT THE AGE OF 90. THE TEXT OF THE PUNCHBOWL NEWS A FEW MINUTES AGO,” he shouted a tweet mark the report.)

The company plans to increase its annual subscription by $50 in January and will eventually also offer a higher-cost subscription that includes data from Electo Analytics for more than $1,000, but the final price has not been set.

“We have a deep understanding of who our audience is and we want to serve them in new ways, and in ways that we've heard them say they want more information from us,” Ms. Palmer said.

Punchbowl News is one of the most promising entrants to the digital news industry in many years. Palmer said the company generated $20 million in revenue this year and is profitable. Although the company focuses primarily on subscriptions, he said it is almost halfway to its projected ad revenue target for 2024. Advertisers include Meta and Exxon Mobil.

Palmer declined to reveal the target number of advertising revenue or how many paying subscribers Punchbowl News has.

Punchbowl News is also expanding its coverage of the financial services industry, “explaining Washington to New York,” Palmer said. By the end of next year, the company aims to employ approximately 30 people, up from 23.

“Our goal is to stay agile,” he said.



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