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February - 2003 - issue > Entrepreneurship
The Newsmaker in New York
Karthik Sundaram
Friday, January 31, 2003
BEFORE, I WAS EMBARRASSED TO GO UP THERE and say that what I have is an unbelievable opportunity,” she says. “Talking about the company is in many ways like talking about yourself. Springboard said that’s OK.” She pauses to reflect on how far she’s come. “My lead investor told me, ‘There's no doubt you knock people's socks off when you pitch.’ And I was thinking, ‘If you only knew...’” Meet Shoba Purushothaman, the 39-year old CEO of New York-based startup, The NewsMarket.

At the non-profit Springboard boot camp, where entrepreneurs are coached to present business plans before investors, Purushothaman made news. Her idea was a dotcom, when the name itself was taboo, and she was seeking funds for a subscription-based revenue generation idea. “At a practice session, a VC said to me, ‘Stop selling me your product and sell me the investment opportunity.’ That was a turning point for me,” recalls the fast-talking CEO.

Picky about her company’s description, Purushothaman describes it as follows: The NewsMarket, Inc. is the first digital platform that brings together various participants in broadcast news on a single, web-based platform to create a more efficient environment for the exchange of video news content, providing the news media with a central destination to locate and acquire broadcast-quality video from a wide variety of sources.

Purushothaman, a Malaysian-born of Indian origin, comes from a media background. After stints at leading public relations firms in London and New York, she left to start one of her own. Following a successful buy-out, Purushothaman, intrigued by the power of the Internet, toyed with an idea of doing something web-based. And in late 1999, she joined forces with her partner from her previous venture and drew up the NewsMarket’s business plan. “There was a quiet revolution happening in the digital media, and we saw a good opportunity to capitalize on this,” says Purushothaman. “While still images were readily translated from raw source to digital content stored online, video was lagging far behind. Through our unique platform, journalists from around the world are able to search, preview and download broadcast-quality video from various sources, including Fortune 500 companies, government agencies, and other institutions.”

Quickly, the duo expanded operations to Singapore, London and Munich, where media maturity was high and the markets were ready to accept their products. “We have been steadily generating revenues from this subscription-based product,” claims Purushothaman. “When you use a clip from our site, you don’t pay anything, unlike rights-controlled images. Our client pays for every download.”

In June of last year, the startup went in for a fresh round of funding, and took $3 million. “We were receiving 50% more than what we sought, and had to turn away funds,” claims the proud CEO. “With digital and broadband technology now an integral part of the broadcast news industry, we will be able to leverage our 18-month lead in the market to launch second-generation products with this capital.” The investment was led by Ascend Venture Group. While the city is widely considered the anchor of the digital media business, the technology market’s fallout has severely impacted investor interest in the media sector.

David Bowen, a partner at Ascend Venture Group says, “The broadcast news environment is in the throes of dynamic change as deregulation and digital technology transform the economics and allow innovative new companies to enter the landscape. We found that The NewsMarket offers an unparalleled investment opportunity with a deep and wide value proposition. The Company has a proven recurring revenue stream, high margins and a team with domain expertise and an excellent track record.”

Purushothaman isn’t resting. She has a team out of India ramping up her version 2.0, and is busy signing up big and small clients to her service. As she says, “We’d like to be the Google of the digital media industry.”

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