Medium is a platform that publishes various articles and pieces of literature from beginner to professional writers. The site provides a place for writers to showcase their works and allow readers to access them. It also offers tools needed by writers to create and publish content. The Medium model is subscription-based. Meaning, customers of the platform had to pay a subscription fee to read.
The company charges 5 dollars monthly or 50 dollars annually as a fee. Medium and the writers share from the revenue earned through the charges.
Evan Williams, the former co-founder of Twitter and Blogger, founded Medium in 2012. Since then, the site has become an excellent source for written content and a platform for sharing them.
Medium raised more than 132 million dollars throughout its operation and accumulated 600 million dollars worth of valuation.
How Does Medium Work?
The Medium model is an open platform for everyone to read and share written content across the Internet.
Evan Williams wrote in his blog that a Medium is a place for you to express what you want to say. It is not about the person or who they know, but what they want to tell.
Writers can create written content under business, sports, health, politics, etc. People can write anything about everything, and readers can access any of them.
The company also works with other large publication companies that publish available content on their sites. Some of these companies are The Economist, Twitch Blog, and Sports Illustrated.
Then, Medium utilizes advanced technology in their operations to advertise contents that’ll match the user’s preferences. The artificial intelligence and editor’s picks suggest exciting content for an individual.
Additionally, Medium users can also follow the contents they want and bookmark articles, writers, and publications in their accounts. It allows the user’s feed to have personalized content showing up with Medium’s technology.
The minimalist web design of Medium removes potential distraction like ads. It helps readers focus more on the writer’s message and content; therefore, the site has white areas.
As for the author’s perspective of navigating the site, Medium makes it easier for them to create content with its straightforward process.
The author needs to sign up in Medium and publish their works. Their published works undergo a quick assessment to make sure that the content is worth posting and quality.
Related Article: How Does Honey Make Money?
The History Of Medium
In 2012, Evan (known as Ev) Williams founded Medium. Up to this day, he is still the CEO of the company.
Evan Williams, born in 1972, grew up and resided on a farm in Nebraska.
Williams studied at the University of Nebraska to pursue college but later dropped out of school. After leaving school, he borrowed money from his parents.
He used the money to venture into various technological ideas when the Internet became popular in the 1990s.
His business ventures varied from selling educational compact discs (CDs) on the football team from his past university to videos that help people connect to the Internet.
However, these business endeavors did not work out nicely for him. By the age of 24, he decided to move to California and prepare for the tech industry.
He aimed to build connections and acquire the necessary skills to be successful. It paid off as O’Reilly Media hired him.
He sold software and programming manuals to local programmers in the U.S. Years later, William finally delved into his first tech success.
The Beginning of Blogger
Evan Williams, together with Meg Hourihan, whom he dated shortly, founded Pyra Labs in 1999.
Pyra Labs is a software tool that aids in project management.
Though the actual software did not make it to the completion stage, the company founded Blogger in the process.
Blogger was the first platform available on the Internet to publish blogs, in case you didn’t know. It allows anyone to create content across the World Wide Web.
However, the founders were not in luck. When Blogger became popular, the internet bubble emerged. This time was when many people invested in technology and internet-based startups.
While Blogger was not expensive to operate, the venture capitalists around the company were turning slowly insolvent.
The company needed to let go of some employees as they were drying up investment funds. By 2001, Hourihan resigned from Blogger, and most of the employees did too afterward.
Hourihan continued her journey in the tech industry and founded Kinja. It is software that collects articles and other written content. Companies like Gizmodo also run on this software.
Meanwhile, Williams tried to hold the company together for the following months. He kept getting small-scale deals and released many updates for Blogger.
Two years after Hourihan and other employees left the company, Williams released a premium version of Blogger that requires money to use.
In February 2003, the Google company acquired Pyra Labs with the amount unrevealed to the public.
Williams stayed under Google for six months before advancing on another path. In 2004, he ventured into another company and co-founded Odeo, a podcast sharing platform.
Odeo is somewhat similar to the goal of Blogger. They wanted to help content creators share audio works, just like Blogger did, but in words.
However, data transmission and other platforms needed to make the Odeo operate smoothly were still in their early development stage. Odeo couldn’t work because its goals were not possible without these technologies.
The Founding of Twitter
When early 2006 came, some Odeo employees tried out another software project that they developed in the same year.
The software allows users to construct short messages and send them to their contacts using Short Message Service (SMS).
What started as a little project for the team in 2006 is now the famous Twitter we know. After three months of releasing it, users increased over 60,000, and they renamed it to Twitter by 2007.
Twitter rapidly grew into fame just a few months after its launch. In 2007, it had over eight million users, which continued to grow over in five months.
Unlike Blogger, the rise to fame of Twitter happened in the perfect time. Before its trend, Google already obtained Youtube.
Facebook also allowed almost every type of user on the platform. Apple also introduced the very first model of the iPhone.
With all these trends opening their doors, Twitter got bigger significantly. Evan Williams became Twitter’s CEO in 2008 after Jack Dorsey stepped down. As of now, Jack Dorsey is the company’s CEO again.
Williams maintained the role for the next two years until he stepped down in October 2010. He remained a board member and focused on the product strategy of Twitter. In 2019, he left the board position.
When Twitter was preparing for its initial public offering, Williams was already planning the start of his next venture, Medium.
By 2013, Twitter transitioned from a private company to a public company that made Williams a billionaire.
Related Article: How Does TikTok Make Money?
The Creation of Medium
Williams got the concept of Medium based on his observations in the social media world. He noticed the developments and patterns of people and the social media platforms as well.
He finds that more sites focus on engaging, entertaining, and shareable content that somehow compromised journalism. William believed that it led to the downfall of blogging.
Medium overcame the usual business crisis considering that it was a new company. It acquired Matter, a science journalism platform, in 2013. Also, Wired’s editor-in-chief later joined Medium as their senior editor.
Before, Medium was available for people who received invites only. But in October 2013, the site became open to the public.
The site’s release to a bigger audience made the company realize the demands and conditions that came with it. Medium removed most of the shared contents due to wrong language usage, abuse, harassment, false information, etc.
The company managed to collect 25 million dollars in funds for the first round despite the initial problems. The investors were Google Ventures, Tim O’Reilly, etc.
During the fundraising period, Medium also tested other ways to gain streams that’ll generate them money. It included the series of sponsored posts for multinational corporation BMW.
Medium temporarily allowed other publications like The Awl to have custom domains that started new partnerships with them.
For the following years, Medium was not entirely public on its growth in numbers. But it claimed that they use the average user time on reading contents as proof of their numerical growth.
Therefore, the mass layoffs in 2017 became a shocker for the public. Around fifty employees had to leave the company, and the offices in New York and Washington closed. The Medium model had to adapt.
The New Beginning For Medium
William announced that they gave up on the advertisement-based sales. In his words, “Upon further reflection, it’s clear that the broken system is ad-driven media on the internet.”
With this decision of Williams, many of their partner publications terminated their deal with Medium. However, the company pursued a new model for it to generate revenue without ad sales.
Medium welcomed the concept of subscriptions as a part of its new Medium model. There were specific contents available for users who availed of the subscription deal.
However, these changes are still under observation. It can prove that journalism cannot survive despite the social media age where it is financially challenging for them, or the site can fix the way the Internet works.
How Does Medium Make Money?
With the changes in their business model, Medium now generates income from charging users with a subscription fee. For 5 dollars per month, users can access specific contents under the premium category.
Aside from it, users can enjoy other features of the premium version of Medium, such as exclusive access to Medium’s magazine, columnists, audiobooks, and personalized daily content choices.
When users read stories in the premium version, a part of the subscription fee goes to the writer. Medium claims that some of the authors on the platform earn up to $25,000 every month for sharing their works.
Medium’s model that uses subscription became a more significant thing for the journalism and publishing industry, particularly online. The New York Times even took a similar approach in their business model after suffering from low revenues.
Medium Funding and Valuation
According to Business Insider, Medium raised a total of $132 million during the three stages of funding. During the Series C round in 2016, the company accumulated a valuation of $600 million.
Some of their investors include Spark Capital, Google Ventures, Andreessen Horowitz, and many more. I think we can all agree that the Medium model is definitely a successful one.
Related Article: How Does Zoom Make Its Money?
Medium Revenue
As a private company, Medium chose not to disclose any number-related information about their company publicly. Since the funding happened almost five years ago, it is presumably operating with a commercially successful revenue.
