Pico 2.0 Aims to Monetize Digital Media

The line between publishers and creators continues to blur, and Pico wants to help monetize it all. Since its launch in 2018, Pico software has helped independent publishers like Block Club Chicago, Defector Media and The Colorado Sun understand and monetize their audiences. As the nature of digital media has shifted, with platforms like Substack empowering lone creators to turn one-person outfits into stand-alone publications, Pico has adapted as well, expanding its focus from publications to creator economy businesses of all kinds. Several individual media businesses, including Jacob Donnelly's A Media Operator and Mario Gabriele's The Generalist, have since adopted Pico to power their entrepreneurial ventures. On Wednesday, the platform that bills itself as the “operating system for the creator economy” made this expansion official, launching the second generation of its software, which is available to existing customers currently and will be introduced to new customers in the coming weeks. In the last year, Pico has quadrupled its user base, which now numbers in the thousands, and its customers are making “tens of millions of dollars per year” using the software, said Jason Bade, its president and co-founder. Pico has also increased its revenue fivefold, reaching an eight-figure top line in 2020, though Bade declined to provide a specific revenue number. Its staff has grown from 14 to nearly 30. In addition to the launch of Pico 2.0, the platform announced a new round of funding that totals $10 million, led by Bullpen Capital and Ann Lai. “The relationship a creator has with their audience is their most important asset," Bade said. “Pico helps them monetize that relationship, and 2.0 aims to expand how we can help.” L. to r., Pico co-founders Jason Bade and Nick Chen Capturing more than 70,000 email addresses Block Club Chicago, which has used Pico since its launch, has captured more than 70,000 email addresses using its email pop-up feature, bringing the email subscriber count of the publication up to 105,000, said editor in chief Shamus Toomey. “For us, the value of Pico is in collecting emails and helping us understand who's in our audience and what they want,” Toomey said, “then being given the tools to monetize that in multiple ways.” Block Club generates the bulk of its revenue through subscriptions, which it handles using Pico payment technology. The Chicago-based publisher has accrued 16,200 paying subscribers in its first three years, adding 5,000 new subscribers in both 2019 and 2020. Block Club is on pace to net $1 million in revenue by the end of 2021 and received 3 million pageviews from 1.5 million unique visitors in March. Shifting payment structure to incentivize growth Currently, Pico generates revenue by levying a percentage fee on the revenue it helps its customers capture. In the case of Block Club, Pico charges a 5% flat fee on subscriptions, which comes in addition to the 3% fee from the payments processor Stripe. As a result, Block Club devotes around 10% of its top-line revenue to afford Pico. Every business, to some degree, is a media business now.Nick Chen, co-founder and CEO, Pico As part of the Pico 2.0 launch, the platform will adjust its payment plans in the coming months, said chief revenue officer Rodolphe Ködderitzsch, who recently joined the company from YouTube. In line with the tier-based models of Shopify, Pico plans to employ a payment system that mixes processing fees and software-as-a-service fees, an adjustment the company hopes will better align its financial incentives with those of its customers. The more money a creator makes, the lower the processing fee will fall, whereas the more features a creator uses, the more they will pay. The upcoming change in its payment model reflects a larger philosophical shift on Pico's part, from casting itself as a platform for publishers to an operating system for creators. Publishers like Block Club and Defector Media flocked to Pico for its wide variety of monetization tools, but independent creators have also found success on the platform. "The distinction between publishers and other creators has really diminished in recent years," said Nick Chen, Pico's co-founder and CEO. "Every business, to some degree, is a media business now." As part of its broader creator-oriented scope, Pico has updated its dashboard to give clients more granular insights and new ways to monetize. The platform offers users on-site pop-ups for email capture, paid newsletters and subscription paywalls as well as more niche tools like paid memberships with tiers and benefits, recurring and one-time donations and online course revenue tools for on-demand and livestreaming. The revamped Pico 2.0, which entailed a ground-up rewriting of the platform’s code, hopes to net a wider user base of creators by offering a larger variety of monetization options. Whether the user is a traditional publisher like Block Club or a lone operator like The Generalist, Pico has built out a suite of tools that allow businesses to monetize in whatever way makes the most sense for them. “The last thing we want—this is in our DNA—is to limit the business-model potential of any of our creative businesses,” Bade said. 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From Publishers to Lone Creators, Pico 2.0 Aims to Monetize Digital Media

Block Club Chicago and others use the software to generate millions in revenue

Mark Stenberg

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