Wetpaint Starts Licensing its Facebook-Based Media Distribution Tech

10/19/12Follow @curtwoodward

Turns out all that celebrity gossip-mongering had a point.

Wetpaint, the well-funded Seattle digital media startup headed by Blue Nile co-founder Ben Elowitz, is now licensing its Facebook-focused content distribution system to outside publishers.

The first deal is with Hubert Burda Media, a German publisher that owns Web and traditional magazine titles. Terms weren’t disclosed, but it’s a very significant deal for Wetpaint in more ways than one.

Most obviously, licensing brings in another stream of revenue to add to traditional online advertising—something that media companies of all sizes are struggling to survive on. That’s a nice addition all by itself.

But here’s what’s even more significant: By selling its expertise in growing an online audience, Wetpaint moves from being just a publisher into also being a technology provider. If you didn’t catch that nuance, the press release hammers it home by describing the startup as “a technology platform company.”

“While the world watched us build this celebrity and entertainment property, we’ve been secretly building the world’s best platform for acquiring audiences,” Elowitz says. “Under the covers, we were very deliberate.”

You could sense this kind of shift coming for Wetpaint, which actually started out life as a provider of wikis and other kinds of Web-publishing software. The company, which has raised some $40 million since its founding, then changed its focus to begin publishing its own websites, particularly focused on celebrity gossip and entertainment news.

That particular category tends to be obesessively followed by young people, especially young women—a coveted demographic for advertisers. Wetpaint’s mission was to build a fast-growing website, with a twist: the company focuses heavily on Facebook to build and interact with its audience.

By tapping into the data generated by social network users, Wetpaint says it can learn much more about what its audience wants to see, and when it wants to see it, and even in what order—in a recent interview, Elowtiz told me how swapping out one “Jersey Shore” actor for another in a story’s headline could bump up traffic by 10 percent.

Elowitz says the proof is in the site’s growth. In the roughly 18 months since the entertainment sites launched, Wetpaint now claims about 12 million monthly unique visitors. That’s a pretty impressive climb, and Wetpaint also touts the way social network-based publishing lets a publisher more closely control the relationship with their audience, “rather than doing a rain dance to get Google’s algorithm to like you.”

Which brings us back to Burda Media, the German publisher that’s signed on as the first to license Wetpaint’s “social distribution system.” The startup will provide the larger publisher with its software, which can plug into existing content management systems, along with training and a “playbook” for getting its content seen and consumed by people through Facebook, Elowitz says.

“With a lot of these really big media companies, they’re just learning social … and they don’t have a center of excellence in the company” for seizing hold of Facebook distribution themselves, Elowitz says.

More deals with publishers could be on the way. And if the Facebook-based publishing system finds fans among big publishers, keep an eye out for big growth at Wetpaint’s Seattle offices.

Curt Woodward is a senior editor for Xconomy based in Boston. Email: cwoodward@xconomy.com Follow @curtwoodward

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