🎙️ Chicago Futurist Vol. 6 with Tim Huelskamp, Founder & CEO of 1440

📅 4 Events in Chicago This Week

After nearly a decade in private equity, Tim Huelskamp left to build something of his own. That became 1440, now one of the fastest growing independent media companies in the US with more than 4.5 million subscribers and a small, lean team.

Tim and I spoke about how 1440 builds trust at scale and what journalism needs to get right next. We also talked about the advantages of building in Chicago and what he hopes to see more of in our city’s startup ecosystem.

Here’s our conversation:

TH: Unit economics discipline: In PE you learn quickly that true growth comes from repeatable, profitable acquisition and retention. That mindset shaped how we built distribution, monetization, and product via our flywheel business model.
Importance of hiring the best team and getting out of their way. 

It sounds cheesy, but I saw when world-class CEOs hired world-class talent, magic always ensued.

TH: Information got louder, not clearer. People don’t want “more content”—they want context they can trust and to be served the best information as quickly as possible from all the verticals, in one place.

Many media companies optimize for outrage or keeping folks on their site, and both reduce efficiently putting knowledge into readers’ brains. We want to help our readers come across new ideas they otherwise wouldn’t have found, efficiently.

TH: What do they say, “the first billion is the hardest” ?  :) 

The first 10,000 was the hardest as we had to fight for PMF, didn’t have the capital resources to reinvest back into the business via our flywheel model, and we were building the business part-time as we figured it out.  After we scaled to a few hundred thousand subscribers, our lean and mean flywheel business model (write world-class content, sell ads, reinvest revenue back into list growth) allowed us to scale quickly, but it took 2 years for the flywheel to kick-in.

TH: This whole business model comes down to one item: are you delighting the customer every day?  If you’re not, the math doesn’t work as you need long-term retention for the model to work.

Given our flywheel business model, we acquire a new subscriber for $3 on average (we invest $1M/month into paid acquisition).  We make a nickel every time someone opens an email, so we see a payback of an engaged user in ~4 months.

I meet many newsletter operators who have poor product (this is easily benchmarked in the newsletter world with the open rate, ours is 65%+), and they focus on monetizing and scaling a poor product when they should drop everything and focus on the product.  I have this conversation with numerous operators per month.  

They seek help on scale and monetization but have a newsletter with a 30% open rate. 
DO NOTHING ELSE until you have a product people love, aka true PMF.

TH: Chicago provides access to world-class talent at a slightly lower costs which allows us to reinvest back in our talent and flywheel business model. Being in the “middle of the country” also allows us to have a pulse of all Americans, which is why our product resonates with readers from all walks of life. 

Our audience is ~1/3rd Dem, ~1/3rd Repub, ~1/3rd Ind, 50/50 M/F, and spread almost perfectly across the country geographically. 

Just like the city we hail from, we serve all Americans.

At 1440, we have a set of 16 principles, which we’ve learned from studying 100s of the best founders of all time. We review them as a team and constantly update them:

TH: Generally, the strongest drivers tend to be:

“Explainers” that reduce confusion: science/health breakthroughs, economics “why this matters,” geopolitics with clear context. 

Practical curiosity: productivity, fascinating cultural learnings (Michelin Stars)

Moments of shared culture: major events people want to understand without the author’s opinion throughout the content.

Our moat is the relationship we have with our readers, not volume of content or trying to keep people on our site for as long as possible. Our team is our audience, we’re curious but we’re busy.

We aim to serve the busy professional, efficiently. The mission is bigger than news. News is one use case. The bigger goal is helping people build a daily practice of curiosity.

A unique graduate bridge program offered a data analyst the next step toward pursuing his passion. The unwanted early career plateau lives on in many of today’s most dynamic industries. Ashvin Veligandla, a former Graduate Student-at-Large Business (GSALB) student who recently graduated from the Chicago Booth School of Business, had a firsthand view onto the phenomenon as it slowed the careers of many of his friends and colleagues.

That was not a pace Ashvin was ready to accept.

“I wanted to accelerate my career,” he says. “My ambition was to see how fast I could move up. I stopped seeing myself as just a technology guy even though I knew I needed to develop a more diverse set of people management and strategic business skills.”

While Ashvin knew that business school was his path forward, he was less sure how to make that happen. Fortunately, a colleague at the Federal Reserve Bank of Chicago, where Ashvin worked as a data analyst, told him about the unique GSALB program at UChicago. The GSALB program lets students enroll in for-credit MBA courses at Chicago Booth before applying to MBA programs.

“The GSALB program gave me the opportunity to experience Booth and to understand what being a student there is like,” he says, looking back on what’s brought him to the present moment. “And through Booth I’ve made so many friends with similar goals and similar values. I expect to be working and collaborating with them far into the future.”

Read Ashvin’s full story

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