Eight months ago, it looked like Flipboard was on its way out.
The six-year-old company had lost key executives. Twitter had taken a hard look at Flipboard as an acquisition target — and passed. A report in the Wall Street Journal spelled out Flipboard’s struggle to hit revenue goals. And on top of it all, the app’s initial appeal — offering a more visual way to consume news — had been replicated and in many ways surpassed by other, bigger players, like Snapchat and Facebook and even Apple.
But don’t tell any of that to Mike McCue, the company’s ever-positive CEO and co-founder, who spoke to Recode last week from a beachside cabana at the Cannes Lions advertising conference in France. He’s more upbeat than ever.
That’s because the company is gearing up for a “major new release” of its product, and McCue says that Flipboard revenue will “basically” double in 2016. Sources say the company brought in between $25 million and $30 million in revenue in 2015 and the company claims 90 million active users.
But McCue and Flipboard are still competing on all sides for user attention when it comes to news content. And the company’s “major new release” actually sounds a lot like what it already does. (More on that below.)
Still, McCue was keen to point out the app’s social magazines, collections of photos and stories that users compile on topics they care about. McCue says there are 26 million magazines on the app, and this creation element appears to be the key focus for the looming product update.
We chatted with McCue about his business, rumors that he was a candidate to be Twitter’s CEO, and Donald Trump. What follows is an edited transcript of our talk.
Recode: Flipboard is more than six years old, but this is your first time at Cannes. What brought you out this year?
Mike McCue: We’re actually working on a major new release of the product coming up — eventually — and so it was good for me to get out here and spend time with our clients, hearing what they want and need.
So are you here as a product guy or a salesman?
I’m selling some, but I’m more trying to hear what [partners] like about our platform, what they want to see us improve, and give them some insight into what we’re thinking about for the next major generation of the product and hear their reaction to that.
Will this update change Flipboard’s basic concept — this personalized-magazine news reader — at all?
What you’ll see us do in the next generation of Flipboard is a clearer version of what we’ve always been about. Not anything really massively new, but a refinement and a focusing in the product that will take us to a totally new level.
So you’re sticking with the social magazine approach.
Absolutely. What I love about the idea of the magazine is [that it’s] about taking great stories that are thoughtfully put together by editors for a given passion. The advertising and the stories in there are completely relevant and completely amazing.
Combine that [content] with the personalization [that] comes through social, so it’s not just editors who are picking those stories, it’s fellow enthusiasts — that’s huge. So you’ll see us really double down on the idea of fellow enthusiasts hand-picking awesome stories for the things you’re passionate about.
Have you thought about hosting content, like Facebook’s Instant Articles or Apple News?
The thing that’s so funny is that’s what we did originally. That was our idea. Loading content quickly, formatting it in a way that makes sense for mobile? Great idea. We did it five years ago. We don’t host the content, though. What we do is format the content, and actually that’s a pretty important difference. Publishers control how their content looks.
So would you ever consider hosting content, now that things have moved in this direction?
Well, [formatting content] is core to what we do. Instant Articles just look like a web page without as many ads. When we format the content, we convert it into something that feels more magazine-like. Hosting the content somewhere else is not necessary.
[When you host content] it’s your CMS. It’s your analytics. It’s your traffic. It’s your user. You can get all the data. And that’s a very big difference. Hosting [content] is a bad idea. Always has been. You’re putting a lot of trust in Facebook. And if you look at their history, and what they’ve done with their platform and people who’ve relied on them, it’s not been a pretty picture. (See: Wednesday’s News Feed algorithm change.)
You still sell all your ads with a sales team. Are you thinking about an ads API to automate this? Instagram and Snapchat are getting into that.
Once you go down that path, once you allow these other advertisers in, you lose the respect of your users. You lose that trust, and there’s no going back from that. The second that we allow the link-bait or the diet ads into the experience, that will start to create an environment where people won’t invest the same kind of time. [So while] we could, like, quadruple our ad revenue if we turned on an API, part of the reason why I raised the amount of money I raised was to create a runway for us to build the right kind of revenue and to not be forced into that situation.
Have you thought about building a subscriptions business?
I thought about that really early on when we were building Flipboard, and I have asked that question subsequently. Each time I keep coming back to this answer: A business focused around advertising is much more scalable.
Twitter looked at you guys as an acquisition target a year or so ago. Why did that fall through? Would you still consider that option?
I can’t really talk about that.
As a former Twitter board member and someone who knows the company well, what should Twitter do to get out of its rut?
I think Twitter is one of those rare companies that is literally actually changing the world. Twitter is a platform where anybody can step up to the microphone and say something to the entire world, and that’s pretty awesome. Twitter is going to be around for a very long time, hopefully forever. They’re in a transitional phase now ... but I have a lot of confidence in [CEO Jack Dorsey] and the Twitter team that you’ll see them power through.
Last summer, when they were looking for a CEO, your name came up. Did they ever reach out, or did you ever consider that job?
They know that I’m massively committed to Flipboard. So it was never ever really an option. Honored to be mentioned [though].
You’ve been outspoken on Twitter about your dislike for Donald Trump. What do you make of this whole election cycle?
This season here is momentous. As a citizen, I feel a duty to call out things like racism. I’m struck by the way Trump has developed his campaign. I imagine it’s probably how people in Germany felt when Hitler was coming to power. I honestly feel like if people had spoken up more and had been more unaccepting of those kinds of positions, maybe things would have been different. And the last thing I want to see is this country have someone who rises to power by appealing to the worst in people. So I feel a civic responsibility to call that out no matter the implications.
This is so disturbing. Trump's viciousness and the way he fires up crowd is like watching Hitler rising to power. https://t.co/LDLs6j9se7— Mike McCue (@mmccue) May 21, 2016
This article originally appeared on Recode.net.