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Patch, the hyperlocal (and profitable) digital news platform, is doubling down on digital transactions as it seeks to pull further away from advertising as a sole revenue source, Patch CEO Warren St. John tells Axios.

Why it matters: Scaling a high-margin revenue stream that's not contingent on page views (the way advertising rates often are calculated) is critical in local news, because truly local news is usually only relevant to small group of people.

  • Revenue from selling access to its hyper-local calendars grew 110% year-over-year from Q2 2018 to Q2 2019 and now generates in the low single-digit millions in revenue.
  • Calendar payments are Patch's first major foray into local transactions, and will hopefully open up a world into other local transactions that Patch can monetize, St. John says.
  • The calendars are free to post on locally, and cost a dollar per day per town to buy. The average transaction size is $48 because people choose multiple towns and multiple days.
  • The transactions on-site can conducted with Stripe, PayPal or Apple Pay.

The big picture: For a long time, a lot of the focus on saving local media has been on subscriptions and memberships. Both Facebook and Google are investing heavily in developing business models that work for local companies around those models.

  • But St. John argues that asking people to pay for news at the local level can be difficult, and rather, asking them to pay for a local service, is more realistic.

The bottom line: "Payments is probably best highest margin scalable solution for local," St. John said last quarter.

What's next: The company is looking to increase payments within its classifieds section, which launched last quarter.

Go deeper

6 hours ago - World

Top general: U.S. losing time to deter China

Stanley McChrystal. Photo: Alex Wong/Getty Images

Stanley McChrystal, a top retired general and Biden adviser, tells Axios that "China's military capacity has risen much faster than people appreciate," and the U.S. is running out of time to counterbalance that in Asia and prevent a scenario such as it seizing Taiwan.

Why it matters: McChrystal, the former commander of U.S. and NATO forces in Afghanistan, recently briefed the president-elect as part of his cabinet of diplomatic and national security advisers. President-elect Joe Biden is considering which Trump- or Obama-era approaches to keep or discard, and what new strategies to pursue.

Progressives shift focus from Biden's Cabinet to his policy agenda

Joe Biden giving remarks in Wilmington, Del., last month. Photo: Roberto Schmidt/AFP via Getty Images

Some progressives tell Axios they believe the window for influencing President-elect Joe Biden’s Cabinet selections has closed, and they’re shifting focus to policy — hoping to shape Biden's agenda even before he’s sworn in.

Why it matters: The left wing of the party often draws attention for its protests, petitions and tweets, but this deliberate move reflects a determination to move beyond some fights they won't win to engage with Biden strategically, and over the long term.

Dave Lawler, author of World
8 hours ago - World

Venezuela's predictable elections herald an uncertain future

The watchful eyes of Hugo Chávez on an election poster in Caracas. Photo: Cristian Hernandez/AFP via Getty

Venezuelans will go to the polls on Sunday, Nicolás Maduro will complete his takeover of the last opposition-held body, and much of the world will refuse to recognize the results.

The big picture: The U.S. and dozens of other countries have backed an opposition boycott of the National Assembly elections on the grounds that — given Maduro's tactics (like tying jobs and welfare benefits to voting), track record, and control of the National Electoral Council — they will be neither free nor fair.