By Doug O'Neill
“Turning an obstacle into an opportunity” has been the genesis of so many successful start-ups. That’s definitely the case for Aswani Pulipaka and Aditya Chityala, the co-founders of CoverStory, an online micropayment platform that sells individual magazine articles for as little as 49 cents – without any mandatory registration or subscription fees.
Considering that Pulipaka and Chityala both work in the financial sector and are MBA graduates from the Rotman School of Management at the University of Toronto, one would assume the impetus for CoverStory grew out of a studied analysis of market needs, consumer trends and the state of the media industry. Not so. “Frustration!” says Pulipaka. “That’s how the idea started. Neither of us has a background in media or publishing of any kind. It all started when my now business partner, Aditya Chityala, was online trying to download an article on Vancouver real estate, and he got really frustrated that he couldn’t just purchase the one article he needed. To get that single article he desired, he would be required to take out a subscription. He was really annoyed by that obstacle.”
This all-or-nothing proposition – common with so many online magazines and newspapers – prompted Pulipaka and Chityala to look at other media sites. “We found we could get a few free articles at most but that was about it,” said Pulipaka. “There was a lot of good content behind paywalls but you either had to subscribe to the entire lot – or you were locked out. There was nothing in the middle, no way of getting just the one article you wanted to read. In today’s economy, consumers want to pick and choose.”
So they started networking – while fully immersed in their demanding day jobs – within the magazine industry in Canada and worked with a developer to launch their website just before Canada Day 2017. The initial titles they brought onboard included Alternatives Journal, Green Teacher, Inroads Journal and EcoParent.
“Our goal,” says Pulipaka, “is to provide an engaging experience for the curious reader who wants to cut through the noise and stay informed by directly supporting quality journalism. And we want to make it seamless and obstacle-free. We deliberately avoided a system of registration fees and mandatory subscriptions. You pay for what you download.”
The two entrepreneurs believe their system is advantageous to smaller publishing houses and magazines that don’t have the time and resources to set up their own transaction sites for selling on a per-article basis. “It’s all very template-driven. We can host a publication’s content on our site or provide a link to theirs,” explains Pulipaka. “There’s no complicated, timely set-up required.” The revenues from the sales of articles are split: 60% for the magazine, 40% for CoverStory.
The start-up has been a learning curve for the two MBA graduates. “We learned – in retrospect – that having contacts within the magazine industry would have been very helpful from the get-go,” says Pulipaka. “Having a great concept isn’t enough. You really need to have some street cred in that sector to network with potential partners.”
To that end, Pulipaka and Chityala have connected with Magazines Canada and presented at MagNet 2018, the annual Canadian magazine industry conference. And just recently, the two entrepreneurs spoke to a class of senior journalism students at Ryerson University. “Once magazine publishers, editors and marketers sit down with us and understand our concept, it’s a no-brainer for them,” says Pulipaka. “CoverStory enables these titles to easily expand expand their audience.” And that’s a story worth reading about.
Photo credit Zlatko Cetinic, Images Made Real