SmartNews — a Tokyo-based news startup — is reportedly announcing a round of funding at a valuation of $1.1 billion, according to Bloomberg. This makes SmartNews the first news business unicorn startup since BuzzFeed and Vox Media joined the “3-comma club” about four years ago.
National mail company Japan Post Capital led the $28 million investment in SmartNews. SmartNews is going to use the funding to hire more software developers. Rather than employing a high number of reporters, SmartNews partners with major publishers to offer each of its ~20 million active users a custom feed. So SmartNews essentially competes against the Apple News app and Google News.
SmartNew was founded by Ken Suzuki (former researcher at the University of Tokyo) and Kaisei Hamamoto (former Director at Rmake Co). The SmartNews app highlights the most popular content and tracks how long users are reading an article to rank how important it is.
“Personalization makes people’s interests narrower, in general,” said Suzuki via Bloomberg. “We try to use personalization technology to expand those interests.”
SmartNews works with nearly 400 publishers including Bloomberg, Fox News, Reuters, PBS, and CBS. And SmartNews sends readers to the original article on a publisher’s website rather than scraping the articles.
In the U.S., SmartNews has been growing sixfold every year and the total $116 million it has raised thus far will help the company further invest in the U.S. And a major strategy for SmartNews is to become a go-to source for the 2020 presidential election. SmartNews’ VP of U.S. marketing Fabien-Pierre Nicolas told Bloomberg that the goal is to appeal to Americans who are looking for a source around the full political spectrum.
“It’s great to have engagement around politics, but we want to make sure people really see both perspectives,” added Nicolas. “Breaking people away from their filter bubbles and helping them see news from outside is really at the core of what we are trying to achieve.” Whether millions of Americans will go along is another question.
