Member Article

Six weeks on: James M-P, founder of Output Magazine on facing failure and crowdfunding success

On a bleak Friday evening in February, James Matthews-Paul, founder and editor-in-chief of Output Magazine, headed home after the hardest week of his life. Accounts showed the bottom of the barrel had been reached, the visual communications trade magazine would be forced to close in a week, unless £10,000 was raised to pay outstanding bills and staff wages.

After several rejections from banks and Government lenders, James had no choice but to stare failure in the face. He admits he was more angry than upset, feeling betrayed by the almighty authorities he had worked so hard to appease.

Monday morning James headed back into the magazine’s Brixton office, ready to consult his editorial team, he recalled the event with marvel, still disbelieving of the last few months: “We thrashed it out and we decided, we can’t be the only business in this position and if we’re going down, we’re going down guns blazing,” he told me.

“We began to research the key _Stop Press_™ feature, becoming ever more disappointed and angry as we read through the government statistics. On the Wednesday, we published and we knew that Friday was D-Day, but as I always like to say, I can do anything with a glimmer of hope.

“By midday the next day, we had received nearly 100 people coming to us saying ˜this is crazy and i__t can’t be allowed to happen - from readers to competitors, it was overwhelming.

On Thursday, we launched the crowdfunding campaign - initially we were going to go with Kickstarter, but with 48 hour approval stage wouldn’t work for us, for obvious reasons.

“That’s when we found Crowdfunder UK, they got us up and running really quickly and worked incredibly hard to get us as much attention as possible. By the end of Thursday, we had raised about £4,900 - we knew we needed £10,000 to stay afloat.

“When I woke up on Friday morning, I just thought I have no idea what will happen by the end of the day and I looked at Crowdfunder, hoping we would have hit the halfway mark, but it was still just shy of £5,000. Despite a slow start, the reaction that morning what phenomenal - a key partner from the industry put in £2,500, helping us hit our target by the end of the week.”

Rewind four years. James, a 25-year old staunch feminist and avid Green Party supporter, joined forces with a former colleague to launch Output Magazine after spotting a gap in the market for an ecologically-written magazine, focusing on the industry he called home - digital media, he explained: “There were hardly any people on Twitter from the industry at the time, and we spotted an opportunity to bring the quality journalism that you would associate with print media to the digital realm.

“We decided to make a go of Output magazine, the original plan was to create a high quality, cohesive reader experience both online and offline - using digital print technology to fuel a new type of magazine with a more ecological run length and applying the technology that we were writing about to publishing.”

It wasn’t long before the Output team grew to four with the appointment of a finance director and a third content writer, James said: “We spent one long hot summer building our database and we launched on 14th November 2010. We worked from my kitchen for the first year while we operated a tight ship and tried to save as much money as possible.

“A year later, we moved into offices and took on an apprentice, while also expanding our content team.”

For the next three years, James and his team put blood, sweat and tears into building a widely-respected trade magazine. Attention then turned to turnover growth, after a staff switch around, Output moved out of the Brixton office and back to the home working environment, “We went back to basics,” James said, “About nine months later, I became involved with the St Bride Foundation, which is an amazing organisation, one of the largest resources of print media and design collateral artefacts - it’s stunning. We were incredibly lucky, they had a spare room in their Fleet Street office and we were based there for a year.”

At the start of 2013, the business was running for three years and, in order to continuing growing at the current rate, Output needed a funding boost. “I was beginning to think about our business plan, and getting in front of the right people. There were two main things we needed - platform development and a full time sales person. We were gathering quite a lot of attention in the industry and we needed a financial boost to help support this projected growth.”

James went to Barclays armed with a new editor, Fleet Street offices and media partners lined up waiting to work with him: “We asked to borrow £20-30k so I could make this business into what it deserves to be. We received a plethora of responses that didn’™t make any sense - from personal finance nitpicking to the decline of print media with no evidence to prove this whatsoever.”

After two months, James failed to meet Barclays’™ ever-changing criteria: “When the barrel of the gun is pointing towards you, coming ever closer, you just panic. You throw all of your resources at it, but without the necessary support and funding, you can’t take that next step. This is what led us to launch the Stop Press campaign.”

When scribing the campaign, James and his team became experts on both banks and government lending schemes. They discovered that, despite what the government says, SME and individual lending has actually decreased by 14 percent over the last five years, according to a KMPG report in September last year. This represents a £309bn shortfall, and HM Treasury’s own documents show the rejection rate for first time business borrowers is 50 percent.

In James’ original Stop Press article, he said: “This lifeblood, though, is anaemic. Nothing, in my experience, is as terrifying as the prospect of failure: of the impact it will have on the people that work for and with me, and on their livelihoods, their ability to pay their rent.

“I was the one crying on Monday as I told my two employees, incredibly talented individuals at the birth of their careers, that the business must close on Friday. They were the ones that held my hands and told me we would go down fighting.”

Six weeks on from Output’™s crowdfunding success, the clouds have begun to part and James is proud to say the campaign is currently overfunding to the tune of £14k. He is in talks with several potential investors to help take the next step. He said: “Now we are through the worst of it, I am furious on behalf of all small businesses that have found themselves in similar situations to us.

“If small businesses are meant to be the backbone of the economy, then why is there no real tactical support? Over half of the businesses which launched in 2010 have failed since, and I want to see the leaders tackle these very real issues in the upcoming Election.”

Visit Crowdfunder to contribute to Output’s ongoing crowdfunding campaign

This was posted in Bdaily's Members' News section by Ellen Forster .