VentureBeat

When Guy Kawasaki started Truemors, a site for spreading Internet rumors, his intentions weren’t quite clear. Was it an experiment? A joke? The product of too much free time? Or perhaps not too much time — after all, it didn’t look like the site had taken much effort to create. “The plan is simple,” Kawasaki wrote at the time. “Get a site launched in a few months, see if people like it, and sell ads and sponsorships (or not).”

Get it launched he did, for a whopping price tag of $12,107.09. And the site quickly garnered its first rave review, duly noted by Kawasaki: “Worst website ever discovered,” read a headline at the Inquirer. Here at VentureBeat, we paused to note that the site was smothered in spam.

But somehow, over the next year, Truemors appears to have cleaned up its act. Traffic to the site looks decent, if uninspiring. And, no rumors here, the site has been acquired by well-funded citizen journalism site NowPublic.

No price was given, and it seems unlikely that a great deal was paid; for that matter, no great effort was made to announce the acquisition. But on an investment of $12,000, who’s complaining? Kawasaki also gets to join the board of NowPublic, which suggests that it was at least more than chump change. Now he just has to sell Alltop, a feed aggregator he launched this year.

Below is a Compete traffic graph for both NowPublic and Truemors. Note that it includes only United States visitors; many of the two sites’ contributors, and readers, are in other countries.

Newsvine, one of the more professional Internet sites that collects news submitted by regular people, has been acquired by MSNBC.com.

Unlike popular news ranking sites Digg and Reddit, which link to existing news sites, much of Newsvine’s content is written and reported by its users. The acquisition marks a deepening acceptance of “citizen journalism” by major media outlets.

Founded in 2005, the site has grown to about a million users per month — a substantial number for such a young site, albeit far fewer than MSNBC’s 29 million. Citizen journalists sites received a lot of attention — some would say hype — back in 2005 and 2006, though the fascination appears to have worn off somewhat. Other sites like NowPublic (our coverage) have popped up, too, resulting in increased competition and raising questions about how many sites can thrive. The deal closed Oct 5.

MSNBC, a venture jointly owned by Microsoft and NBC, also happens to reside in Redmond, near Newsvine’s Seattle homebase.

The terms of the acquisition weren’t announced, but likely represent a significant profit for Newsvine investors. The site only took about $1.5 million in funding during its year and a half of existence.

The purchase price was likely several times higher. For comparison’s purpose, Fox Interactive acquired Newroo, another news startup, for between $5 and $10 million in March 2006. An article about the Newsvine acquisition on MSNBC notes that similar buyouts have been for as much as $75 million.

Newsvine will retain its own separate operations, although both companies said the site’s staff may grow. The acquisition was MSNBC’s first.

Associated Content, a company that delivers all kinds of information online, from movie reviews to tutorials about how to fix a kitchen sink disposal, has raised a $10 million in a second round of funding.

Associated Content is notable because its branding is all but unknown, but it is drawing five million unique users and 12 million page views monthly — almost entirely by tinkering with its content so that it appears high in search engine results. The site has almost no return visitors based on loyalty. The traffic data comes from the company’s chief executive Geoff Reiss, and is based on his reading of Google Analytics.

CEO Reiss tells VentureBeat the site is using a mixture of “best practices” for search engine optimization (SEO), such as labeling articles with various tags on its pages to better bait the main search engines like Google. Timing of the news, which follows on the heels of an announcement by news site NowPublic that it had raised $10.6 million, is purely coincidental, he said. Canaan Venture Partners, a Silicon Valley venture capital firm, led the investment in the Denver/New York-based Associated Content. Existing backer Softbank Capital participated, as did Tim Armstrong, a Google executive. The company raised a $5.4 million first round last year.

Reiss told VentureBeat he does not see NowPublic as a competitor. News is only one component of Associated Content’s offerings. AC draws content from specialists in any field, and content can be text, audio or video. While it has fewer contributors than NowPublic (70,000 compared to 118,000), AC’s contributors go through a more rigorous sign up process, and tend to stick around longer, he said. AC has more traffic. AC’s content focus is extremely broad, in our view, and its difficult to see how they will establish loyalty through branding. Reiss said establishing such branding is a goal of the company going forward.
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NowPublic, the citizen journalism site that lets individuals take pictures and post articles about news they see going on around them, has raised $10.6 million in a first round of capital.

NowPublic, based in Vancouver, says it now has 118,000 contributing journalists, more than the 50,000 or so journalists at a competing site, OhmyNews. Once NowPublic contributors submit their news, NowPublic puts it on its own Web site, but also offers it up to news organizations, such as Associated Press, which can select the reports, photos or videos they want. These organizations may choose to take content only from top-rated journalists, and from those attending events that they couldn’t otherwise get to. They pay a fee to get this content. We last wrote about NowPublic when it raised $1.4 million in angel funding.

Chief executive Leonard Brody said it was the largest first round funding for any citizen journalist site. OhmyNews, a site based in Korea but which is now international, raised $11 million in a second round of financing. OhmyNews is somewhat different, however, in that it hires journalists and pays them based on advertising revenue it gets to its site. Another competitor is AssociatedContent, which focuses less on breaking news. For example, on Friday, that site’s lead story was a feature on the new Simpsons movie — something that could have been published anytime over the past week. NowPublic’s lead story, by contrast, was of the two helicopters that collided in Phoenix, something that as breaking at the time.

This comes at a time when some other related community sites, such as Backfence, haven’t done too well. NowPublic is does not rely on any one community.

The funding was led by Rho Ventures and Rho Canada. The round also included two other venture firms, Brightspark and the Working Opportunity Fund, both of which participated as seed investors.

Brody said it has expanded its relationship with AP so that it now delivers information to AP bureaus across the U.S.

Brody pledged that he will build the largest news agency in the world over the next 24 months, by reach. It has contributors in over 140 countries and 3,600 cities.

(Updated at bottom with more discussion on differences from Digg, others)

Thoof is the latest company seeking to offer news readers articles that are relevant to them.

The Austin, Tex. company launched today, boasting an approach it says is more useful to the wider masses than competitors such as Digg, Reddit, NewsVine, NowPublic, Topix and others that seek to rank articles. Thoof’s trick is to latch on to information it finds about users’ news tastes, store this information in a place where it constantly updates its list about you, and then steadily improve its service.

It is founded by engineer Ian Clarke, who left the video-sharing site Revver last year, where he had been a co-founder and chief scientist. Two other Revver employees have joined him.

After an initial review of the site, we’re convinced this has great potential, and are keen to see it succeed — because most other efforts have failed to do this job well. By its nature, Thoof does better the more people use it. It depends on user-submitted articles, and so the volume of stories in its system is small at launch. We found no articles on “finance,” for example.

Here’s how it works, and why we endorse the concept.

Like Digg, Thoof provides a synopsis of articles on its home page — this includes headline, brief summary, and tags to designate topic matter. It then provides a link to the article, and sends the reader to the original source.

That’s where the similarities with Digg end. It doesn’t let other readers rank the articles for you. Rather, it offers articles to you based on what knows about you, such as IP address (which provides geographical location), the browser you use, your operating system and the site you were on when you clicked through to Thoof — all of which offer subtle clues about you. Then, additionally, as you search articles, it tracks the tags of the articles you read. Finally, it may soon begin asking you a random question from time to time, to gather more information.

Next, it lets you correct the article summaries. See screenshot below, where the arrows show the multiple ways you can correct a piece. You can propose a change, but it must first be approved vote a vote by members of Thoof’s community. Right now, that community consists of just three people, but Thoof hopes more members will participate as traffic grows. This correction process gives Thoof a leg-up on Digg, which has suffered notorious accuracy problems.

This project is way too early to know whether it will succeed or not. A long-shot? Yes. However, Clarke has put deeper thought into this than we’ve seen in some other throw-it-together jobs on personalized news attempts over the past couple of years.

Before Revver, Clarke built Freenet, a very early decentralized P2P technology designed to let people obtain information on the Internet while avoiding censorship — for use by people in China, for example. He attempted to commercialize the technology, forming Uprizer, but left in 2002 and dabbled in a number of projects.

At Revver, Clarke says he learned the limitations of collaborative filtering technologies used by companies like StumbleUpon and Amazon.com. These services offer you content — music, articles or whatever — based selections by others who have shown similar choices you’ve made in the past. However, the technology slows the more users are added to the system. It also doesn’t work well without the user first surfing for hours — so that the system can track selections.

Clarke also sought to avoid problems faced at other companies: Digg is dependent niche crowd of tech-savvy young males selecting stories, and can’t get out of its rut, he says. It offers no personalization for the rest of the world’s audience. Reddit meanwhile, tends to be politically slanted, and lacks corrective features, thus pointing to the need for editors. Finally, Wikipedia does a good job with editors, but breaks down when dealing with controversy. Some entries, on President George Bush for example, get “locked down” to avoid constant edits by fringe interests. A group of editors voting on changes deals with controversy, Clarke concluded.

Clarke wanted to build an algorithm that can store unlimited amount of information about a user’s interests. Thoof seeks to pinpoint personal tastes in more sophisticated ways, using Bayesian statistics. He points to a company called Cycorp, which is developing large knowledge base, feeding information into it like the “sky” is “blue.” He’s licensing information from a company doing something similar, but wouldn’t specify.

Thoof is built on a Java-based open-source framework called Wicket.

It has raised $1 million from Austin Ventures and angel investor Ron Conway.

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