The TinyPass team, based in Seattle and NYC, chats via Skype. They are, from left to right: Tim Dirrenberger, David Restrepo, Kirill Kouterguine and Will Coghlan.

In an opinion piece for Bloomberg this week, former Microsoft Chief Technology Officer Nathan Myhrvold lamented the demise of the physical newspaper and wondered if the solution might be in a payment system for news content.

That message certainly will resonate with TinyPass, a 12-month-old startup that’s created a new way for news organizations to make money without erecting pesky paywalls. A few online publishers, including Seattleite and DJ Booth, are already giving it a shot.

We caught up with TinyPass co-founder Will Coghlan, who relocated to Seattle 10 months ago and is currently based out of the Founder’s Co-op offices in South Lake Union, to find out more about how they plan to help publishers cash in on their content.

Explain what you do so our parents can understand it: “TinyPass makes it easy for anyone to charge for access to their online content.”

Inspiration hit us when: “We learned that The New York Times reportedly spent $25 million to build their very basic, very leaky paywall. We knew we could build a better toolset that any publisher, large or small, could use to set up a smarter paid-content plan with no upfront cost. It’s no secret that ads alone just don’t pay the bills for most digital media publishers, so paid-content is really the only alternative.”

VC, Angel or Bootstrap: “Angel. TinyPass closed a significant — more than $500,000 angel round — in the Fall of 2011, and will be seeking a Series A round in the spring of 2012.”

Our ‘secret sauce’ is: “1) A startup with a real business model and real revenue from the very first user. 2) Technology that offers both convenience and measurable cost-saving to our clients. 3) A product that is better for both our publisher partners and their audience. TinyPass isn’t just a publisher-friendly API, it’s also the easiest way for anyone to pay for access to online content, whether you’re talking about a $1 day-pass to a news site, a $4.99 album download, or a $200 bundle of industry reports.”

The smartest move we’ve made so far: “Moving quickly to stay ahead of the curve. We believe that the market for paid digital content, with music, apps, and virtual goods representing the initial wave, is gaining traction and that there is an opportunity for media companies to begin to experiment with paid content models as a way to supplement their digital advertising revenues. In five years, the idea of paying for content on the web will be commonplace. That means there will be much more competition among service providers in this space. But right now, most online publishers are still only dipping a pinky toe into the paid-content space. The results of the paid content movement so far have been almost universally positive, so it’s an industry ready for explosive growth.”

The biggest mistake we’ve made so far: “At first we had a tendency to build features that performed really well but didn’t look as good as they should. Over the past few months we’ve made lots of consumer-facing improvements and TinyPass now looks as good as it performs.”

Would you rather have Gates, Jobs, Zuckerberg or Bezos in your corner: “Bezos. He understands the value of digital content, he’s constantly innovating, he’s relentlessly competitive, and he doesn’t give anything away for free.”

Our world domination strategy starts when: “Publishers realize that not only is our platform feature rich and easy to use, it’s also purpose-built to minimize the fees they’re charged by online payment processors like PayPal. Not only does TinyPass eliminate the heavy-lifting involved with setting up a paid-content plan, we actually save publishers money when they use our platform.”

Rivals should fear us because: “We put our clients and their customers first, always. Every feature we build starts with the questions, “How does this make life easier for our clients,” and “How does this make transactions more seamless for their audience.”

We are truly unique because: “We’re the only paid-content platform that offers publishers the ability to charge for access in whatever way makes sense for their unique content and their unique audience. Whether you have a WordPress blog with a niche following, or a news site with millions of readers, you can use TinyPass to charge for access to your content in whatever way you think will work best.”

The biggest hurdle we’ve overcome is: “Convincing publishers that there are alternatives to a traditional paywall. We’ve learned that publishers will get more overall value from their digital media if they’re more creative with their approach to paid-content, but many think their only option is a paywall that locks everyone out unless they’re willing to pay a high price on a recurring basis.”

What’s the one piece of advice you’d give to other entrepreneurs just starting out: “Pain is the biggest motivating factor when it comes to adopting new technologies. For our clients, it’s the pain of decreasing advertising revenue, and the hassle and expense of building and implementing their own paid-content plan. So find some pain, build a clever way to make it go away, and you can’t lose.”

Startup Spotlight is an occasional look at a Seattle area startup company. Have an interesting new venture you want spotlighted in GeekWire? Fill out the questions above, send photos of the founder(s) and company logo to tips@geekwire.com. Past profiles can be found here.

Comments

  • Ghost

    I absolutely love the idea of a micro-payments system like this.  What payment forms are you using?  Any consideration into Bitcoin?  

    • http://twitter.com/tinypass TinyPass

      Thanks — glad you like it! Currently we offer payment via PayPal, Amazon, Google Wallet, and credit card. We love the Bitcoin concept, and we’ll definitely work to add it to the list in the future, as we want to offer as many forms of payment as possible.

    • Trevor

      We’re currently using Paypal, Google Checkout, Amazon Payments, and credit cards.  We love Bitcoin, but I believe our clients are still a bit nervous about whether they’ll be able to fluidly and reliably convert their bitcoins into dollars.  

      But if you have any ideas about integrating Bitcoin and TinyPass, we’d love to hear them! 

  • MR

    The devil is in the details. The NYT didn’t spend $25 million on a payment system. It was part of that but it was a much much larger scope project then that.

  • http://twitter.com/toddhooper Todd Hooper

    Nicely done Will and team!

  • http://twitter.com/dumpster07101 dumpsternewark

    HTML5.

  • http://www.facebook.com/kurt.boeker Kurt Boeker

    Yeah? Try to use it. No real service or support. Buggy dash and even worse integration. The company must be these 3 guys in the picture. It looks like it would be a great product. But it is definitely not anything close to what you’d expect now a days. More like one kid in his dorm. Good luck.

    • Trevor Kaufman

      Kurt, this is Trevor Kaufman, and I’m the CEO of Tinypass (and no, I’m not in that picture, which was taken about a year and a half ago when we were much smaller!). Of course, we take upset clients very seriously, small or large, so I wanted to get back to you personally.

      I see in Zendesk that you have been corresponding with one of our senior developers this morning, and that he got back to you two hours after you submitted a question, so I’d respectfully differ on your view of our service and support.

      You’ve caught us red-handed, however, in that you’re using our Joomla plug-in, which we’re trying to stop supporting (we just haven’t seen the usage of Joomla that we expected). We’ve been focused developing our API, and on our WordPress and Drupal modules. But as we told you in our last support comment, we’re launching a new version of our platform on Monday, and that should help you with implementation within Joomla.

      Regardless, when we next get together for a company photo in our offices, I’m going to send it to you! And Kirill (the developer who you are corresponding with) and I will follow up with you on Monday after our new release to make sure we can help you implement the product on your Joomla-based site. Sorry for your difficulty, and thanks for your interest in the platform.

      All the best,

      Trevor

      • http://twitter.com/docwaller Doc Waller

        This, my friends, is how you run and represent your company! A straight-forward, informative, yet civil response.

        Trevor, I’ve gained a great deal of respect for you and Tinypass after reading this. Furthermore, I’m only at this article because I was suggesting Tinypass to a friend this morning and wanted to read up more on it before I passed it on.

        I’m a performing artist, writer, producer, and I’m looking forward to integrating Tinypass into the media/content delivery to my fans/audience through my upcoming redesigned site (soon). I’m also Producing Curator (Founder) for Public Avenue (www.publicave.com), a start-up news and media community, and am eager to see how TinyPass can be woven into our production process.

        Keep up the great work, and best of luck to you and the team!

        Creatively,

        Doc Waller
        @docwaller
        http://www.thedocwaller.com

      • http://mummysaysimspecial.com/ Wild Bill Howlett

        Trevor, any chance of getting someone to respond to my support query? (#3499) Have been trying to get a response for almost a week now and am wanting to get to the root of an issue so that I can decide if we recommend Tinypass as a solution to our client or not.
        Many thanks

        • Trevor

          Wild Bill –

          As I’m sure you’ve seen by now, Kris responded to you an hour after your last message, asking for a copy of the Drupal error you’re receiving so we can give it to our tech team. I suspect you’re right, and that this is an issue with the HTTP request limitation of your shared hosting provider — we’ll see what workarounds we can come up with.

          We’ll start working on this in advance of seeing the precise error message and make a recommendation.

          Best,

          Trevor

          • http://mummysaysimspecial.com/ Wild Bill Howlett

            So he has. Great, many thanks

          • http://mummysaysimspecial.com/ Wild Bill Howlett

            Problem fixed!

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