Q&A With Venture Capitalist Powerhouse Eric Hippeau on the Future of Digital Media

Hippeau assesses the state of the industry

"It's clear now that the future is digital."
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Eric Hippeau has been riding the media wave for almost three decades—from running Ziff Davis throughout the 1990s to serving as the chief executive of the Huffington Post during its 2011 sale to AOL.

Since then, Hippeau has served as managing director at Lerer Hippeau Ventures, the venture capital company whose fingerprints are all over the digital media landscape. As an early stage investor to digital media companies like BuzzFeed, NowThis (Hippeau is also a co-founder of NowThis), Warby Parker, Axios, Casper, Giphy, Mic, Percolate and others, Lerer Hippeau has arguably had more influence in shaping the realities of “new” media than any other company. In effect, his role is to bet on the future of media and advertising.

Adweek recently visited Hippeau in his lofty SoHo office to talk about the current state of media, where it’s heading, and how tech plays a vital role in the decisions the industry makes.

The following has been edited for length and clarity.

Adweek: It seems we’re at an inflection point in the media, one being led by rapid advancement of technology. Perhaps more importantly, it’s a time for media to not repeat the mistakes of the past. Is that an accurate assessment?

Hippeau: That makes sense; I guess what you’re saying is it’s time for these companies to fully embrace all the tools that are available. That wasn’t clear before. It’s clear now that the future is digital. And so [it’s important to be] all-in—and “all-in” means that you have to restructure your operations very differently.

Adweek: So for restructuring operations, you go from HuffPost’s SEO magic to BuzzFeed’s distributed content. What’s next?

Hippeau: [Next is the] concept of channels—that there is a concentration of content that you are particularly in tune with but is still within the platform. You don’t have to leave the platform. I think that’s that’s a very positive evolution. I think the Discover section in Snapchat is actually quite [good]. Snapchat made the decision not to give you third party content in your feed. You actually have to go. I actually think that’s pretty smart because it means that I have made a conscious decision to go to CNN on the Discover platform.

Adweek: SEO strategy and social distribution strategy is replicable from media company to media company; channel discovery doesn’t seem to be as an opportunity to be as pervasive.

Hippeau: Well, it’s not that it gives you this massive distribution, but it’s going to give you a committed audience, which is really what media has always been about. I remember when I used to publish [at Ziff Davis] and we had like 20 different computer magazines. People would say to me, “How is it possible?” and I said it’s because you pick up a magazine and it either attracts or rejects you until you find the right thing. And those audiences will be, by definition, smaller than the mass, right? But they will be a very valuable audience for advertising.

Adweek: Do you think this evolution works for publications like The New York Times or The Wall Street Journal? Media companies already have channels; they’re beats.

Hippeau: So those are the traditional ways to cut those channels. I don’t know the answer to that. I think in some cases, like news, like when you hear these surveys a majority of people now read their news or find their news on Facebook, you say, ‘what news are they finding on Facebook?’ What do they mean by news? But in the morning, I want to see the digital edition of The New York Times. So whatever platform I’m on, either I’m going to news or specifically go to The New York Times. But unfortunately, The New York Times doesn’t have that strategy, so I can’t find The New York Times in a comprehensive way on Facebook. I can’t. It’s not really updated. It doesn’t give me the news.

So there’s that, but there’s also the new kinds of channels. A good example is Tasty, which is a brand, but it’s also a channel, because it’s all about food.

Adweek: So this ‘channel’ evolution implies some kind of brand loyalty. Do you think that we might be coming back to a time of digital brand loyalty versus just kind of getting bites here and there based on your Facebook feed?

Hippeau: So the history of content, from the very beginning, is always that content is king. And I firmly believe in that. We are going through a phase where there was an attempt to just give us a massive amount of content that was undifferentiated or false, like in the case of this Russian stuff, or just deliberately vague. And I think people are starting to see through that and the idea that content should be trusted will, I think, pervade.  

Adweek: Do you see that being driven by algorithms and AI?

Hippeau: To some degree, that’s what they’re doing today, right? Facebook as an example: their algos determine what you seem to like, then try to give you more of that. I think that that’s put us into a hole.

Twitter, you can choose who you follow and that’s really basically what you get in your feed. When you like something on Facebook, it doesn’t necessarily mean that’s what you’re going to see.  

Adweek: But moving forward, since we know that that happens, are we moving into a world where these algorithms can do this, but we just don’t know what kind of content we’re going to receive—where the algorithms are going to decide where we’re going to go?

Hippeau: So the idea that AI exists in a vacuum is false, because the basic premise of AI is that you train the algorithm. Someone out there is training the algorithm—usually it’s humans. Maybe in the future, it can be another AI.

So at the moment, going back to this idea of Facebook, I have no idea who these people are who are training the AI that shows me what’s in my feed. And I have no idea what their intentions are, what their biases might be—and rather than doing it that way, why don’t they allow me to train my algo? Why is this some mysterious black box doing it?

Adweek: Then training the algorithm is essentially making media more personalized. Do you see that philosophy also moving outside the media into how advertisers are going to be looking at AI; giving it a more personalized touch, if you will?

Hippeau: You’d think that would be the rational evolution of programmatic. Unfortunately programmatic is a little stuck. I mean, how often do you actually go buy a pair shoes?  [But] for a few weeks, you still see the same ads. I just bought these shoes; sell me something else! So programmatic is stuck, but you’re right, you’d think that the evolution of that would be to add some intelligence so they could try to figure out more about you, not necessarily just because you visited some website.

Adweek: To quote Wayne Gretzky, ‘Skate to where the puck is going, not to where it’s at.’ You seem to take that philosophy in media. Are those questions of the AI evolution and personalization informing how you analyze possible investments?

Hippeau: Yes, but it’s not yet—or hasn’t been—the predominant criteria. Personalization has always been the holy grail for media and has never worked. My NYT feed is the same as your NYT feed. … For some reason, it hasn’t been done.

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