State of the Noonion: Building, Selling and Storytelling @ HackerNoon

This is a redacted version of the HackerNoon shareholders' newsletter by CEO David Smooke and COO Linh Dao Smooke sent to HackerNoon’s 1.3k shareholders. Picture: HackerNoon team eats ice cream at a company offsite.

TL;DR

Our product development team is humming along, building and integrating the HackerNoon CMS with the internet’s best publishing technologies.
Valuation’s up: Forward Research purchased $250,000 worth of HackerNoon common stock shares at $42.55/share, a $50M pre-money valuation.
Startups of the Year (video) has its first 200k+ votes and has trending startups all over the internet talking about their HackerNoon nomination. Our business database now includes information on 60k+ companies.
Revenue’s risen 6 years in a row, but we fell short of our 2022 revenue goals, totaling redacted , a redacted YoY increase.
Expenses are down redacted YoY YtD. We cut costs at the top and the bottom, reducing management (Linh’s + David’s) compensation, reducing part-time staff, and eliminating all nonessential business costs.
We published 8,311 stories YTD, a 52% YoY increase. Read HackerNoon Top Stories for editorial picks and The TechBeat for trending stories chosen by the people.

Product

The HackerNoon product team’s been busy building and strengthening the platform, facilitating our mission to publishing quality tech content vetted by a 2nd human editor in this unpredictable macroeconomic landscape (AI replacing web3 as the next big thing, tech layoffs, and dry startups funding notwithstanding).

Product themes:

Audience Development

Content alone does not drive readership. We build publishing functionality to curate and distribute quality stories. The following features widen and deepen our relationship with new and existing writers and readers:

Subscribe for Writers (video) - all published HackerNoon writers can now collect email subscribers via both profile and story page and have their new stories sent directly to subscribers’ inboxes.
22 Parent Categories - all HackerNoon stories are now categorized into 1 of 22 niches that spin off into:
- 22 Category Specific Newsletters - with 250k+ subscribers and counting, these newsletters target readers interested in specific niches, rather than general top content from our daily Noonification or weekly company techbrief.
- 22 Category Specific Podcasts - audio content consumers can now find our top performing stories, read by AI for now, in their podcast feeds.
The Learn Repo (post explainer) - our 2nd ever open source Github repo of top HackerNoon stories ranked by reading time
- First open repo was our HackerNoon font, which was downloaded ~2000 times on Github and Dafont this year.
On this Day in Tech History - this feature combines historical tech events with a call back to interesting HackerNoon stories of years past, published on the same day. For example, did you know that on this day (July 4, 1996), Hotmail Launched as a Free Email Service?

AI & Machine Learning Integrations

Wouldn’t be a 2023 tech newsletter without mentioning AI once would it? 😛Jokes aside, these features are our practical use of AI across our CMS:

AI Headline Generator - This reads the content of the story and suggests the catchiest headlines possible based off of existing content.
AI Image Generator - fully accessible to our community of 45k+ writers, the HackerNoon AI Image Generator comes with 5 different models from Stable Diffusion, MidJourney Diffusion to Kandinsky; with both a prompt and a negative prompt.
Community driven AI image library - To date, 4148 images have been prompted and 903 used as feature images by our writers.
AI ~~Replacing~~ Assisting Human editors - In beta, it helps editors with 1st pass at checking for grammatical and formatting mistakes while detecting plagiarism and AI-content itself. ChatGPT-4 is also used to rewrite highlighted text within the HackerNoon text editor. While not as astute as our editors, this tool can do basic preliminary checks on common glaring mistakes.
Machine learning translations for all top stories - These ensure accessibility and international accessibility for our top stories. With annotations revamp the community will also be able to improve these machine generated translations.

Business Database

2,500 businesses already trusted HackerNoon with their content distribution, so we improve their reach further by creating various company rankings and indexes incorporating them, and other industry leaders.

Redesign of Discover Companies page to include better search, a more comprehensive ranking system, and 3 ways to filter. Check out Microsoft's company page here. Learn more about Evergreen, our updated Tech Company Ranking System here.
Startups of the Year 2023 (announcement post & SuperbCrew Interview with David) - launched early May, this annual campaign features sleek new design, a more streamlined database (of this year’s 31k startups as well as winners of years past). This year’s nominees can also claim their accounts and customize their descriptions. 217k votes cast YTD, this campaign will announce the winners in January 2024.

Web3 Integrations

Dethroned by AI though it’s been, web3 is still one of our bets for the future, including our most recent round of funding, and our upcoming documentary.

Arweave Web3 Backups - HackerNoon has published over 1 billion words, and now all those words and stories are backed up on the Arweave blockchain.
Sunset our Coil Integration - Coil unfortunately decided to sunset their Web Monetization product. The business entity Coil continues as a HackerNoon shareholder.
NFT as Profile Picture - building on Web3 login and writing contest payments, we’ve set up the option for a person’s visual identity to be an NFT.

Content Portability

Writers of HackerNoon can now easily move their content in and out of the CMS with a couple simple clicks.

Our Content Management System can now power contributor sites on any domain (beta). Some example sites: CoinWikis.com, WritingContests.xyz, HackerNoon.LinhDaoSmooke.com, Blog.Slogging.com, and HackerNoon.tech.
Improved content Import and Export. Contributors can now export their content in PDF, HTML, audio file, and access it on Arweave, and in addition to importing by individual URL, contributors can now mass import content from other blogging platforms (beta).
Managed Accounts - for our customers, we are building features and processes to manage larger volumes of content. Some of our best MA accounts include Crypto Hayes, BugSnag, AmazonIVS, Protocol Labs, Courier, & Indrive.

For the most updated and frequent product updates, visit HackerNoon.Tech. We publish there every few weeks. Notably, check out this, this, and this.

Valuation

Forward Research purchased $250,000 worth of HackerNoon common stock shares at $42.55/ share, a $50M pre-money valuation. This is great news for shareholders, who’ve previously purchased shares at StartEngine price of $8.20 in 2019 and strategic investment price of $11.35/share in 2020.

As part of this strategic partnership, HackerNoon now backs up its entire text library on the Arweave blockchain. Some news coverage links for reference: TechStartups, MarketWired, Invezz, Newswire, PermaNews, Arweave CEO Sam Williams, and AllyWatch.

We are not in a rush to raise more money, but will continue to opportunistically speak with other tech companies about owning HackerNoon shares. We want to align our interests with the most cutting edge publishing and technology companies.

Revenue

Our 2022 revenue plateaued, totaling redacted just above our 2021 revenue (redacted YoY). While QoQ revenue increased in 2022 Q1, 2022 Q2 and 2022 Q3, 2022 Q4 was our worst revenue quarter since Q1 2021. While some of this is seasonal and some of this under our control, the massive tech layoffs and budget cuts greatly impacted our existing and prospective customers. For example, one of our previously trusted sales email lists had a 35% bounce rate due to layoffs. We have seen a slight redacted QoQ rebound in Q1 2023 and a more promising early rebound in Q2 2023. We expect to hover around profitably in 2023, moving our expenses with the growth of revenue.

Some notable business realignments we did this year to combat macroeconomic challenges:

Startups of the Year launched (video) and added 31k+ startups to the top of the HackerNoon business account freemium funnel. This campaign has its first 217k+ votes and has trending startups all over the internet talking about their HackerNoon nomination.

Niche targeting simplification from 30k+ tags to 22 niche technology categories. This better aligned our ad inventory to our content relevancy ad placement philosophy into sellable units. All 100,000+ stories are now categorized into 22 buckets that pertain to distinct advertisement requirements, enabling advertisers to buy only those impressions and clicks that are relevant to their line of business. As a result, targeted ads turned out to be the biggest rising star of ad inventory, overtaking even writing contests.
Writing Contests 2.0 (what winners say): Given the diverse needs and expectations of advertisers with this inventory item, we divided it up into 3 different categories that attract customers from different price points.
- Mini-Contests: redacted/contest that runs for 1 month, no premium tags allowed.
- Standard Writing Contests: minimum redacted/contest that runs for 3 months, top 50 highest traffic tags are purchasable.
- Mega-Contests: min redacted/contest for customers who want to ‘throw in the kitchen sink,’ aggressively marketing it on HackerNoon and around the web.

Editorial

Ahrefs Ranks HackerNoon.com as the 2,848th site on the entire internet, in the same realm as other sites pictured above like Bain.com, BHG.com, ICQ.com, WTO.org, WesternUnion.com, and McDonalds.com.

YTD, we’ve published 8,311 stories, generating years of reading time. Our stories come with translations in 7 languages, emoji credibility indicators, a lite version, quotable images, commenting, and more. All published writers now can also gain newsletters subscribers a-la substack directly on HackerNoon. With a leaner editorial staff, our focus has been on building stronger and longer-lasting relationships with our top users. See writers' testimonials here, but people continue to trust HackerNoon as a place to learn and publish, citing distribution benefit, reputation, “bragging rights”, monetary compensations, and growing job opportunities. As always, visit HackerNoon top stories for editorial picks, or the TechBeat for trending stories chosen by the people.

The entire Internet (if not the entire world) is talking about, and for good reason, ChatGPT and more broadly LLMs changing how we write, how we edit, and how we code. We’ve known this was coming, we’ve been publishing about GPT before it was cool. We have integrated AI tools to generate images, suggest better headlines, translate stories into 7 languages, and even improve grammar, punctuation, and wording. For a deeper dive on our AI publishing strategy and progress, tune in to our VP Editorial Limarc on the WhatsAI podcast.

We are not using AI to take away jobs, but rather using it to help our editors edit faster, help our writers write better, and maybe even create art that takes your breath away.

Here are some of the highlights so far this year:

We published 4,196 stories in Q1 compared to just 2,822 stories in Q1 of 2022. We published 8,311 stories YTD, a 52% YoY increase.
This story received 68,868 reads this year in Spanish alone and is close to cracking 1 Million total reads.
This brand story went viral and cracked 100,000 reads.
AI and ChatGPT have been the subject of many viral headlines this year:
Our blogging fellowship stories alone have accumulated over 650,000 reads so far this year, and in April we just welcomed our biggest cohort yet of 13 new fellows.

Operations

We cut costs at the top and the bottom, reducing management (Linh’s + David’s) compensation, reducing part-time staff, and eliminated all nonessential business costs. We did retain all our entire full-time staff of 17 people going forward. These are the people who make HackerNoon happen. As we walk the profitability line, we are very confident in this team’s ability.

As we are management and we missed our revenue 2022 revenue goal, Linh and I reduced our compensation. We’ll re-evaluate this in January 2024 based on our 2023 revenue numbers. Across all teams, we also audited and greatly reduced all nonessential software and business expenses to get leaner. We also moved up infrastructure reducing costs projects, like increasing the use of smarter Caching, Svetle and Cloudflare.

How to Support HackerNoon:

We are launching a HackerNoon documentary called Web 2.5 with screenings at tech events, a couple small movie theaters, and on Amazon Prime. Pls support by watching the trailer here and let us know if you want to host a watch party once the film is released.
Buy a HackerNoon hat, it’s the best physical product we’ve ever sold.

Kind Regards, COO Linh Dao Smooke & CEO David Smooke

P.S. If seeking more regular updates from HackerNoon, I recommend subscribing to the #hackernoon-product tag, hackernoon.tech, and/or the #hackernoon tag.