This ‘E-ZPass for news,’ a Philly start-up called NICKLpass, thrives on corporate subscribers

NICKLpass is a growing Philadelphia-based start-up that offers discounted subscription packages to news websites, video services, podcasts and other media.

NICKLpass created software and a browser extension that acts as a sort of “E-ZPass for subscriptions,” according to the company, as it grants corporate clients access to news and other content without requiring individual logins each time, for a lower price.

Companies can offer the service to employees as a benefit and cost-saver for workers who need to stay informed. Employers get discounted bundles on news subscriptions while NICKLpass earns a portion of revenue from publishers.

“We’re trying to solve the problem of how people get access to quality, paid news,” said CEO and co-founder Sumorwuo Zaza. “What we know is that enterprises need news to be successful, and most places don’t have a way to manage that across different teams” within a corporation.

NICKLpass also has taken on a second mission: It helps news organizations raise sales in the ever-expanding paywall era.

An August 2019 study found that fewer than 1% of readers who bump into a paywall will pay for a subscription. NICKLpass helps readers get around the frustration of a paywall at a time when publications are increasingly depending on subscriptions for revenue as advertising dollars are scooped up by online portals such as Google. Firms that buy NICKLPasses get around paywalls.

Zaza came up with the idea after first starting a bundle service for news distributors, then pivoting to sell to corporate clients.

NICKLpass participated in the 2019 Comcast NBCUniversal LIFT Labs Accelerator for start-ups, and has since raised more than $5 million.

NICKLpass has inked partnerships with more than 200 media outlets, including Time Magazine, Business Insider, TechCrunch, Los Angeles Times and others. Among its investors are Comcast and Ben Franklin Partners, said Zaza.

More than 100 companies have signed up for NICKLpass, which charges a monthly average of $20 per employee, usually for six to 10 subscriptions. Zaza said he is targeting companies with employees numbering anywhere from 100 workers to as many as 10,000.

“I really care about news,” said Zaza, 32, a 2011 graduate of Harvard. He grew up in Liberia, and his interest in news started with watching his father work as a freelance writer in West Africa.

“This company is the result of me experimenting in 2018 and 2019 with a lot of new ways of helping journalists get paid for their work,” he said. “I went into the business side a bit by accident.”

A good friend in management consulting was Arianna Huffington’s chief of staff, who asked Zaza to be the website’s director of international expansion. Initially he turned it down, but joined eventually and said that “once I got there I felt like I was at home.” Zaza started his career as a community organizer for U.S. Sen. Cory Booker (D., N.J.) before working at HuffPost.

Zaza said he enjoys working on the business and technology side of media, “setting the table, if you will, for journalists and creatives. It’s like being a massive fan of movies and realizing that instead of wanting to be the best actor or actress, you want to help produce the films and get them distributed around the world.”

By offering subscription packages to large employers, NICKLpass drives down per reader monthly costs, removes clunky paywalls, and delivers readers who see premium ads on the publishing sites.

The company now employs 20 people full and part time, in sales, marketing and programming.

“We started selling in 2020, in the middle of the pandemic. It was nuts. People were consuming more news on both desktops and mobile,” Zaza said.

Publishers are willing to offer lower rates to group subscriptions, and executives can customize NICKLpasses for teams that subscribe to niche trade publications, podcasts and videos. Sometimes the savings can add up to 50% off of retail price.

“Executives can customize the passes for teams that do specific niche things, such as trade publications. So we can market these NICKLpasses for enterprise groups,” he said.

Since founding NICKLpass in 2019, he has recruited from Google, CNN, and Women.com, and has set up offices in Manila, Lagos, and San Francisco, along with a headquarters in Philadelphia.

NICKLpass doesn’t release financial information but claims annual revenues of $1 million to $3 million as of last year.

NICKLpass may be onto something, since digital news revenue is growing. Digital advertising accounted for 39% of newspaper advertising revenue in 2020, based on a Pew analysis. That’s up from 35% in 2019 and at 17% in 2011, Pew found.

Its customers include large corporate employers such as Anheuser-Busch and smaller companies such as Motley Fool, which provide the tool to their employees to keep up with their respective industries.

Monk Inyang, director of entertainment and influencer partnerships at Anheuser-Busch, said NICKLpass saves time and it’s pretty easy. “You just get the extension on your browser, and then you have access to all your subscriptions.”

Based in New York, Inyang said he reads Ad Age, Adweek and the New York Times through NICKLpass.

Inyang suggested NICKLpass as an employee benefit for one of his marketing teams because “different people complained about different access. So we initially got about 25 people on the system, and we really enjoyed it. They told other people in the company about it, and it’s spread around.”