We may all be hyperlocal sites, but that doesn’t mean that we don’t have big dreams of growth. And we all define expansion differently.
For some it is making similar sites available to surrounding communities, for others it is expanding civic engagement or offering technology and social media skills they have developed to businesses and groups in their community.
David Boraks has been there and done much of that. The founder of DavidsonNews.Net in North Carolina, he expanded to a second site called CorneliusNews.Net. But he noted that, before he ever expanded geography, he first expanded his content, which now covers business, health, real estate and more.
Step two was to get the business side of his business in order. “When you get into discussions about expansion you are wearing a completly different hat,” said Boraks. “It was a very unfamiliar hat to me.” At Block By Block in 2010, he hadn’t made the leap to thinking of himself as a businessperson. Now, at the 2011 conference, he has. “I went from trying as hard as I could to ignore the financials, to going over them weekly,” Boraks added.
Then ask yourself some questions: Why are you expanding? What is the opportunity? Do you have a business plan? “If you are going to talk to other people about money you have to have something to show them,” Boraks said. He noted that you can get help on a business plan from others in your community, or services like SCORE, the U.S. Small Business Administration’s Service Corps of Retired Executives. The business plan will evolve, both as your business grows and as you meet with investors.
Several participants voiced notes of caution about finding the right fit with an investor. Boraks rejected some possible deals because the time that would have been needed to manage them would have detracted from his running his sites. And know which kind of investor you are dealing with: Some are chasing unsustainable deals in a Groupon-like deal frenzy, others may be looking to impose inexperienced management or unpalatable terms. “No business should ever give up more than 10%,” said Kael Goodman, who runs the Brooklyn real estate site Brownstoner. Remember, too, that the right investor can bring much more than money to the table, from perspective and expertise to connections.
Not everyone felt the need for outside money. “I’m a big fan of self-financing,” said Ned Berke. He founded Sheepshead Bites and recently expanded to an adjacent Brooklyn neighborhood.”I let our second site grow the way the first one did,” he said. “As audience grows we will grow the site.”
Whatever your course, do not sell yourself–or your site–short. “When you think poor,” said Goodman, “you are poor.”