#StartupsEverywhere profile: Ryan Heafy, Co-Founder and COO, 6AM City
This profile is part of #StartupsEverywhere, an ongoing series highlighting startup leaders in ecosystems across the country. This interview has been edited for length, content, and clarity.
Delivering Local Content While Encouraging Community Participation
As local media outlets in the United States struggle with declining revenues, a South Carolina-based startup is working to engage readers across the Southeast by curating and creating localized content to spur greater participation and involvement in local communities. 6AM City, based in Greenville, provides daily newsletters with hyper-localized coverage to subscribers, and then works to encourage ongoing discussions, conversations, and engagement across social media. We spoke with Ryan Heafy, 6AM City’s co-founder and COO, to learn more about the startup’s approach to local content, the Greenville startup ecosystem, and how South Carolina’s lapsed angel tax credit promoted greater investments in startups.
Can you tell us a bit about yourself and your background?
I was born and raised in Connecticut, and have a background in mechanical engineering. I worked in aerospace manufacturing for a while, helping to dual source the Black Hawk helicopter transmission. While that’s not media at all, I had the unique opportunity to take a journey from the Fortune 500 world to the small business sector.
I came to South Carolina to help run an aerospace manufacturing company. When I left in 2014, I stepped into the nonprofit space and focused on STEM education and workforce development. One of the lessons I learned from working with manufacturing companies is that access to skilled labor is a big challenge. My passion around STEM education and workforce development came from recognizing that there was a gap in the market, and that I was positioned to invest some time there. And while doing that, I learned about other communication challenges on the local level.
My business partner’s family owns a large media company in the Upstate of South Carolina called Community Journals Publishing, with deep roots in traditional print and content creation. Ryan Johnston, our CEO and my co-founder, was the publisher of Upstate Business Journal and is very involved in economic development in the local community. We connected through a civic leadership development program and began conversations about how to innovate content distribution on a local level and scale it, and then it became a reality. We launched 6AM City in Greenville first, in four months, with strong advertiser backing. My co-founder, Ryan, had the vision and pre-existing relationships to help get the company off the ground from an advertising base. And I came to the table with the operational business skills to help execute. As founders with different yet complementary skill sets, that allowed us to run in separate lanes and handle certain parts of the business more efficiently.
A lot of people have tackled communicating the news on a national level, but the local media scene has struggled to find a profitable model. So we knew that we were on to something, and we’ve figured out how to scale and position ourselves as the fastest growing local media company in the country. We’re now in seven cities, and we’re at a point where we’re ready to kick this up a notch and start our national expansion.
Tell us more about 6AM City. What is the work that you’re doing, and how are you working to engage local subscribers?
We’re working hard to support the future of local media by creating and providing a sustainable business model to the markets that we serve today, and to those we intend to serve tomorrow. We say we’re experts at curating, narrating, packaging, and delivering local content. We’ve figured out how to listen to our community and to understand across a wide spectrum what’s happening. We’re trying to open our readers’ eyes to opportunities to become educated and activated in their local communities.
We do that with two local editorial staff in each market and a paid intern. They trade off covering social media one day and writing the newsletter the next day. This allows a lot of our content to be cyclical, so we’ll push something out on social media today that we’re going to use to build the newsletter tomorrow, and then push that back out on social media the next day. So we’re in this learning loop and having a conversation with our readers all the time across different online platforms.
The newsletter is our core product, and it’s a five minute read that’s conversational in tone. We try to take an approach to educating the community in a way that is as unbiased as possible. And our readers tell us that. We poll our readership and they put us smack in the middle on where they think we fall politically, which is pretty interesting and something we’re proud to have achieved.
We also have engagement modules built into our featured content every day to help facilitate the conversations and dialogue. So we try to drive community participation, which also gives people a reason to open the product every day. Our featured story, the primary piece of content we put at the top of the newsletter every day, kicks off the daily conversation. It starts in the newsletter and then we continue the conversation online and across social media throughout the day.
A lot of the content strategy goes to pushing this content out and then repackaging it in appropriate ways across social media platforms. A lot of times we’ll publish something to social media first, and then leverage engagement tools in the newsletter to drive readers back to that social media post to learn more and continue dialogue.
As content creation continues to change and as local media outlets either go away or evolve, we serve more as a distribution partner for content, elevating conversations in the community rather than pushing a traditional narrative. Instead of talking at the reader, we’re trying to create and facilitate conversations within our community.
What makes Greenville’s startup ecosystem so unique?
The Southeast provides a unique opportunity for businesses because a lot of people are moving here and are very supportive of the development and growth of their local communities. In a city like Greenville, we’ve been fortunate to have a strong investor network and entrepreneurial ecosystem that’s been building for the last decade, including VentureSouth, SCRA, and NEXT.
It can take a little longer to raise money in the South because a lot of investing is built off of relationships. But there's typically a stronger bond between founders and investors, which usually makes the relationship more friendly and more supportive of businesses. It also means you’re not going to get as significant an investment unless your idea is viable, since there’s often a longer due diligence period and deeper understanding of the business model.
It’s been a unique experience for us because our community supported us when we launched, our investors are continuing to support us financially, and several of the Southeastern states created—or had until recently—strong tax incentives for investors that invested in high growth companies. That was an absolute blessing to our company as we grew. So there’s a strong ecosystem that has allowed us to thrive, and I don’t know if we could have launched this product in a larger city with more noise and other stuff going on. We’ve really been able to build a strong foothold in the Southeast and actually establish a network of markets that are collaboratively sharing content that is relatable from city to city.
What are some policy issues relevant to 6AM City that state and federal policymakers have or should pay attention to?
First, we have taken multiple approaches to fundraising, including through equity and debt-based financing rounds. And we had huge success with tax credits on a local level. As I mentioned, South Carolina had created tax incentives for individuals who invest in high growth companies. As a high growth company, our investors were able obtain tax credits of up to 35 percent of the amount invested. Unfortunately, that program was allowed to lapse in January, and South Carolina startups are very actively trying to get it reinstated. It would help startups dramatically with fundraising if the government continued using tax incentives to encourage private investments.
Second, copyright is always on our radar. We aggregate content and information, and are always looking out for copyright policy changes that would impact our business. Put simply, one of the biggest liabilities for our company would be changes in how copyright is handled for online content. If the U.S. were to overcompensate, and controls for copyrighted content were too tight, it could become challenging financially and logistically to navigate that. We would be concerned if copyright law made it too difficult to share content, and if the law made it difficult or impossible to write a blog and comment on, or link to, other material. We are at a happy medium with copyright law right now.
And it is essential to ensure that new businesses can clearly and easily understand copyright policy, and know what they can and cannot do, so that they are not accidentally put in a difficult legal situation later in their growth. As copyright policy is being evaluated, it is important to consider the entrepreneurial landscape, as many local businesses, non-profits, and media companies rely on the ability to create and freely distribute content. A large shift in policy might not have a significant impact on large companies that can accommodate change, but it could unintentionally result in a negative impact on entrepreneurs and the small business community.
Third, similarly, data privacy and security is an area where we see a lot of movement. Not all startups can afford to figure out the security and privacy piece on their own. Instead, they pay a vendor or work with a partner who can help to protect user data correctly. We recognize the importance here, and as privacy policies continue to develop, it may cost startups more money to figure out the state of affairs and comply with various laws. This is another area where small businesses and startups need to be in the conversation, to effectively ensure we can evolve with technology and societal changes in a manner that is supportive of everyone.
Finally, we are building some new technology, and are thinking about how to protect it. A lot of startups do not understand how to protect the technology they are creating, and it can be very difficult to determine the value of your intellectual property.
Do you think any of these policy considerations are particularly important in the context of the current pandemic?
Funding is an issue. The investor tax credits I mentioned could help promote investment right now. It may be mutually beneficial for businesses and investors to start fueling an economic restart by reinstating or allowing a national tax credit for investors that are supporting small businesses.
In addition, a lot of companies are facing content distribution and advertising challenges that they rely on to support their business. Under the SBA’s existing programs, certain loan money cannot be spent on marketing, even though that is the thing many startups need to pay for at the moment in order to drive revenue and keep their staff employed. Changes to existing loan programs, or expanding former tax credits, could help startups survive a financial downturn.
How do you see 6AM City playing a role in policy?
We are very civic-oriented. We are always looking to engage on a local level around issues like how to vote or how to participate in local boards and commissions. Our platform is often a jumping off point for facilitating conversations that drive effective policy changes in our markets. Our content is designed to educate and to activate, and we solve a communication gap at the local level by creating conversational media. 6AM City has even been recruited by local economic development authorities to move into new markets, in part because of that conversational posture. Local leaders want good content distribution and engagement platforms that drive economic impact at the local level. We have become that solution.
What is your goal for 6AM City moving forward?
We are actively looking at expanding to as many as five new cities this year, and then scaling that up even faster moving forward. Our focus over the next 24 months is primarily on the East Coast, from Pennsylvania to Florida, and as far west as Alabama. We’re also working with three national media platforms on strategic partnerships. These partnerships revolve around investment, audience development, content, and revenue on a local and regional level.
We’re also growing via acquisition over the next few years, and are currently evaluating the acquisition of several local media properties to expedite our expansion. And we’re also looking at other ways to support smaller markets where we aren’t operating. There’s a huge challenge now for local media, and a big part of our objective is helping to deliver solutions that make local markets more profitable and sustainable.
All of the information in this profile was accurate at the date and time of publication.
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