The Rebooting Show
By Brian Morrissey
The Rebooting ShowMay 17, 2022
How AI will change advertising
This episode is sponsored by Kerv, which uses artificial intelligence to identify objects within video and match them to databases, enabling for, among other uses, the creation of interactive “shoppable video” that embeds commerce in entertainment
Kerv CEO Gary Mittman sees AI leading a sea change to the creative process, allowing for a movie franchise, for instance, to create sequels to the original without starting from scratch. For advertising, the changes are poised to be broader, with AI detecting ads that are not performing and automatically "fixing" them without much in the way of human involvement. “This is another revolution, and we're at a precipice of the creation of something new,” he said. Other highlights:Subscription fatigue. The land rush phase of the streaming wars is over. The pendulum is shifting from subscriptions to advertising. “People are not going to pay for 100 different channels at $5-$10 a month,” Gary said. “ It's just not going to happen.” The “Jennifer Aniston’s sweater” moment. In ancient days – think 2005 – a staple of what were then called internet conferences was the idea that you’d be able to watch “Friends” and tap to buy a Jennifer Anniston sweater set. Much of the tech wasn’t ready, much less the consumer behavior, but that’s changing. “There's a long road of dead bodies to get here,” Gary said. QR codes are changing behaviors. Of all the changes of the pandemic, the comeback of QR codes was among the least likely. Now, it’s the norm to see QR on TV ads, shifting consumer behavior. “The capability of having a one-click transaction off of television with your remote is where we're heading,” Gary said.
The China Project’s pivot to B2B and subscriptions
The Rebooting show is sponsored by Kerv Interactive, an AI-powered video creative technology that creates shoppable and immersive experiences within any video content. Learn more.
On this week’s episode of The Rebooting Show, Bob Guterma, CEO of The China Project, to discuss how to maintain credibility while catching flack from many sides, The China Project’s decision to leave Substack, adopting a subscription-first model and its crowdfunding efforts to raise capital from its audience.For seven years, The China Project – called SupChina until July 2022 – has aimed to act as a bridge for the outside world to understand China. “It's literally 5x the number of people in America. In some ways, you could say [China] is more dynamic. Their historical trajectory is so fast that there are simultaneously people living the same as they did 150 years ago, and there are people living in the Jetsons – all in the same country. That task that’s grown more complicated in recent years as tensions have risen between the US and China. That’s ensnared The China Project in political hot water, with a group of hawkish senators saying it is a tool of Chinese influence and the Chinese government banning it. Guterma has described The China Project as “neither pro-China or anti-China” and its mission as “helping the world understand China better, more contextually, and with greater care, so that better decisions can be made.” The China Project moved off Substack, which is oriented more to single writer projects than full-fledged media properties. “There are ways to customize Substack as you go along, but it's really built around this one experience of a paid newsletter. We were already, and just only became more and more as time went on, not just a newsletter.” The China Project has multiple revenue streams, including ads, events and consulting, but it aims to be a subscription-first publisher. The China Project sells subscriptions from $120 for an individual up to $5,000 per year for database products. It made this shift with a changed focus on a B2B audience, which is more likely to pay for subscriptions than regular people simply curious about China. “As much as I think China is the biggest story of our times, most people aren't sitting at home thinking about how to cultivate better knowledge of China, and they're certainly not sitting at home ready to spend money on that.” The era of venture-funded publishing is mostly over, but new avenues are emerging, such as RegCF, which allows companies to use crowdfunding to raise up to $5 million over the course of 12 months. The China Project raised $1.6 million two years ago and is near $1 million in a second round. The China Project has raised nearly $10 million over the years. That incremental approach is preferable to big upfront funding, in Bob’s view: “Raising $50 million before you've done anything almost guarantees your irrelevance.”
Semafor did a deep a piece on The China Project that highlights the criticisms leveled at it in a whistleblower complaint that alleges it slants coverage to favor Chinese interests. (Bob dismisses this coverage as innuendo and cover for Semafor’s own indirect ties to the Chinese government through a partnership with a Chinese think tank.)
The China Project published a lengthy rebuttal, claiming it is “a target of racist, populist, anti-China sentiment.”
Unlike most small publishers, The China Project has published an annual report as part of its earlier crowdfunding capital raise.
Industry Dive's Sean Griffey's guide to sustainable media businesses
Thanks to Kerv for sponsoring this episode. To see Kerv's technology at work, check out Peacock's MustShop TV.
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Last week, I traveled to Washington DC to record a podcast with Sean Griffey, CEO of Industry Dive. I’ve known Sean and Industry Dive a while, mostly because two of its 33 publications – Marketing Dive and Retail Dive – were in areas in which my previous companies had publications. Sean was also the rare media CEO who would come onto my podcast and not rattle off a bunch of talking points. The big numbers he talked about weren’t Facebook video views of ComScore uniques ginned up through traffic assignment schemes. He spoke about revenue and, imagine, EBITDA.
Industry Dive went on to be bought not once but twice. First in a transaction to growth equity firm Falfurrias Capital in 2019 and then last year in a deal to events giant Informa last year that Axios reported put an enterprise value on Industry Dive of $525 million. That would make Industry Dive’s value at over two Vices and five BuzzFeeds.
What Industry Dive got right is something I covered after the Informa deal. I was long impressed by Sean and Industry Dive’s management ability to stay focused and disciplined in their business model. It helped that Industry Dive didn’t raise venture capital. Constraints can be good. It meant focusing on what was working, notably newsletters and being good at putting first-party data to use for B2B marketers.
In B2B, the pull to do events – have you signed up for The Rebooting’s Cannes events yet? – is strong. That’s because B2B doesn’t have advertisers per se, but marketers. And B2B marketers serve to get their sales teams prospects. That leads many B2B publications to go heavily to events. Industry Dive skipped events because it was very good at building publications in high value industries with tons of regulation and tech-driven change and acting as a critical marketing partner. That isn’t revolutionary. But it’s hard to execute.
Another aspect that impressed me about what Industry Dive did was it executed its playbook not once but across multiple industries. It didn’t wait until it perfected its playbook in one industry, because as Sean told me, you will perpetually put it off because you’ll never feel like you’ve gotten there. Building a leading publication in a single industry is hard but also has a fairly low ceiling, if you’re trying to build a big company. (I tend to think more people should be OK building a great company that’s smaller and skip the lure of massive exits.) Industry Dive was able to pull that off.
And finally, I think there’s something to be said about how Sean and his team went about building their work without all the PR nonsense. I hope of the many things that are left behind from the previous era, it’s the out of whack ratio between sizzle and steak. Fake it till you make it always struck me as a terrible strategy. Ask Ozy.
Time CEO Jessica Sibley on taking down Time's paywall
Last week, I was in Chicago to attend the Omeda OX6 conference, where I recorded a live version of The Rebooting Show podcast. Jessica Sibley, CEO of Time, joined me to discuss her first six months at the 100-year-old publishing brand. Among the issues we discussed:
The benefits of being a “legacy” brand
The importance of a brand clearly standing for something
Why taking down a paywall was right for Time’s strategy
How Time is building a diversified business strategy
Why commerce content needs to sit alongside the newsroom, not in it
Why she believes in an in-office culture
Private Media's Will Hayward on battling Murdoch
Will Hayward, the CEO of Private Media, an independent publishing company in Australia that publishes several titles, including politics-focused Crikey, recently faced the intriguing and likely slightly terrifying experience of being the subject of a defamation lawsuit filed by Lachlan Murdoch over a Crikey opinion column that held the Murdochs were “unindicted co-conspirators” of the Jan 6 attack on the US Capitol. Murdoch withdrew the lawsuit in the aftermath of Fox settling its case with Dominion, much to Will’s relief.
We discussed the case, the decision to stand firm against a powerful and angry individual, and how Crikey made lemonade out of lemons by using the case to rally support for the politics publication through subscriptions. We also touch on the impact of Australia’s news bargaining code that has wrung payments from platforms and is the model for similar laws worldwide, including in the US, as well as lessons learned from the social publishing era, since Will was in the thick of it.
Axios' Sara Fischer and Vox's Peter Kafka on where the. media business goes next
When I sent over topics for the latest episode of The Rebooting show to Axios’s Sara Fischer and Vox’s Peter Kafka, Peter replied with an editorial note: “maybe something deliberately upbeat to counteract a very gloomy pod.” Listeners, we tried, but journalists don’t naturally do upbeat. Some highlights:
This is a good time to be niche: “Niche media is thriving in an era where generalist media seems to be declining,” Sara said. “Companies that launch with a little bit of money, but in a targeted way, focusing on one specific thing with authority, tend to build incrementally and more sustainably than companies that try to do it all at once upfront.”
The Messenger is coming next week and… counterintuitive: “I don't believe that there is an audience that's salivating out there for straight-down-the-middle news,” Peter said. “Anyone who says that is lying to themselves or to the public.”
After the streaming wars comes the winnowing: “You’re going to have fewer of these big subscription services, more of these free ad-supported services, and streaming will continue to dominate more of the time that people spend in terms of consuming television,” Sara said. “No longer is it plausible that everyone can just launch a subscription service and think that they're going to take meaningful market share.”
The AI “tsunami of bullshit” is coming: “We're still relying on Google for referral traffic and the idea that people might find our articles there,” Peter said. “Whether or not you use AI, you are going to be swamped by the tsunami of bullshit, whether it's good or not, content made by robots. And even if every publisher and every trade group in America agrees to not do it, it doesn't matter because it'll come from all over the world.”
Kyle Tibbs Jones on The Bitter Southerner's independent path
The Bitter Southerner began as a passion project for a group of natives to the South who were, well, a bit bitter about how it was often caricatured or reduced to its historical legacy as the birthplace of American slavery. That’s a past that is unfortunately still alive and is an indelible part of the American story. The Bitter Southerner confronts such issues head on but while telling a more nuanced and expansive story of this unique and yes complicated part of the world.
Kyle Tibbs Jones, a co-founder of The Bitter Southerner, joined me to discuss the decade-long effort to build a sustainable, independent publication.
NYU's Jay Rosen on why news needs subsidies
News on its own is often not a great business. Advertisers want to avoid it, and the humans required to recreate the product every day drive up costs, and subscriptions can only go so far. New York University journalism professor and media analyst Jay Rosen sees the need to discover new sources of subsidies to maintain a healthy news ecosystem. In this discussion, we cover that issue as well as the end of BuzzFeed News, the prospects for The Messenger and Semafor, why Trump hacked conventional political news coverage, promising efforts at building sustainable local journalism models, and Jay’s belief that Fox News is not a legitimate news organization.
Bullish's Brian Hanly on building media businesses from memes
Brian Hanly, CEO of Bullish Studio, is creating media brands from memes, working with a stable of finance meme accounts in particular to build media properties. I got to know Brian over the pandemic, and quickly became fascinated by Bullish’s business. No doubt much of the fintech media segment was helped along by ZIRP and crypto craziness, but the use of memes as the starting point for lightweight media businesses is a good template as we enter into what’s sure to be another crazy cycle for the media business.
Substack’s CEO on ads, bundling and what’s next
Last Thursday, I spoke to Substack CEO Chris Best to get a better understanding of where the company is going. We recorded the interview before Elon Musk threw a temper tantrum over Substack's coming Twitter competitor. Chris and I spoke about a couple of important issues to me: ads and bundling. On ads, Chris explains that Substack is trying to occupy a part of the market on an opposite pole from the attention grabbing part of digital media defined by platforms like Facebook and TikTok. But he allowed that ads could be done in a way that makes sense for the space Substack wants to occupy. On bundling, Substack is opposed to a "subscribe to Substack" option that obviates the direct relationship with individual publishers. Instead, he's more interested in "writer federations" and reader-directed bundles that get the upside of bundle economics but don't tradeoff the direct relationship between the audience and publishers.
Nexstar's Joe Ruffalo on "non-partisan" news
Joe Ruffalo was recently named senior vice president and general manager of Nexstar's NewsNation digital operations and The Hill. At both, Nexstar is looking to occupy a lane of "non-partisan" news outlets, betting on a middle ground that seems to have disappeared from the news landscape, as personality-driven opinion has proven far more lucrative and scalable.
What's the future of Vice?
Claire Atkinson, chief media correspondent at Insider, has long experience covering the ins and outs of the media industry. In this episode, we discuss the state of affairs as different parts of the media business are between eras.
What’s next for Vice and the other ailing big digital publishers? The usual answer would be more consolidation, but this time might call an bundling of assets to realize more value.
Streaming’s next phase. Disney’s shifts after Bob Iger’s return indicate a new era of sustainability after the free-spending ways of the streaming wars.
CNN and Fox News’ identity crises. As what is sure to be a bonkers presidential election campaign nears, the twin poles of the cable news universe are in their own forms of disarray.
The sports rights question. Sports programming continues to fetch higher rates as it basically props up many cable broadcasters. Tech platforms continue to tiptoe into this arena, but Claire explains why rights holders are unlikely to cast their lots entirely with subscription streaming platforms.
The Cool Down's Dave Finocchio on building a mainstream climate brand
Dave Finocchio was CEO of Bleacher Report, one of the success stories of the last era of digital publishing. Dave is back in publishing with The Cool Down, which aims to be a mainstream publishing brand for climate conscious consumers. We discuss the lessons from Bleacher, how to strike the right tone to avoid both alarmism and lecturing, and how publishing business models have shifted.
The Daily Upside’s growth playbook
Patrick Trousdale started The Daily Upside in 2019 after working in investment banking at Guggenheim. Patrick saw the success Morning Brew and The Hustle had with newsletters that produced business, finance and entrepreneurial news for younger audiences. He started The Daily Upside with the idea there was space for a newsletter that catered more to investors as a lens instead of general business and finance.
The Daily Upside is now at the point where it can incrementally expand. It started that in January with the acquisition of a specialist newsletter called Patent Drop that trawls patent registries for updates on what tech companies are filing patents that will expand into a publication focused on “technologies like blockchain and AI, how policy is impacting tech innovation, and conversations with the thought leaders and entrepreneurs building the future.” The Daily Upside will also launch Power Corridor, a publication at the intersection of Wall Street and Washington with longtime Institutional Investor journalist Leah Goodman.
The opportunity Patrick sees is applying The Daily Upside growth playbook to these new properties – and using them to move beyond aggregation. Making the shift from aggregation to original content is a time-honored and tricky path in digital publishing. I can remember when Business Insider was mostly aggregating the reporting of others.
Informed's twist on a subscription news bundle
Axel Bard Bringéus is co-founder of Informed, a Berlin-based company with $5.3 million in backing that’s building a service for subscribers to pay for access to paywalled content from top tier publishers like Bloomberg, The Economist, The Financial Times and more. Informed is focused on people in non-English speaking countries who graze on English-language news content yet not enough to consider a subscription. This is a smart approach. Publishers always struggle to make money from international audiences. Most advertisers do not sell globally. And international visitors, in my experience, are far less likely to convert to paid. Axel and I discuss the Informed approach, and how his experience as a Spotify exec informs how he sees the news market.
Darren Samuelsohn on taking the solo path as a journalist
On this week’s episode of The Rebooting Show, I spoke to Darren Samuelsohn, a longtime politician reporter who was most recently head of Insider’s ill-fated DC bureau. Darren and I spoke about his new newsletter devoted to journalism, the decision to take an independent path, and the topsy-turvy career that’s journalism.
Sinocism's Bill Bishop on building a solo publishing business
Bill Bishop likes to make clear he’s not a journalist. Instead, he’s a China analyst who brings his deep understanding of the country to an English-speaking language through his newsletter, Sinocism. In 2017, Bill became the “original Substacker” after teaming up with Substack’s co-founders to be the first newsletter on the platform.
On this week’s episode of The Rebooting Show, Bill and I discuss his independent path, and how a subscription model has created different dynamics as opposed to his experiences in the dot-com era as a co-founder of Marketwatch. What’s telling to me is that Bill is also now considering advertising. The Substack model of “only ads” doesn’t make much sense long term for most writers. Even if they convert 10% of their audience, they’re making no money from 90%. Most businesses don’t operate that way.
The Dispatch nears 40k paid subscribers
The Dispatch is a three-year-old publication focused on bringing fact-based politics news and analysis from a center-right perspective. Steve Hayes, CEO of The Dispatch, joined the podcast to discuss how it's managed to climb to near 40,000 paying subscribers with a healthy 17 percent conversion rate from its free email list. Steve discusses the importance of aligning the editorial mission and business model, occupying the middle ground between the institutional media brands and the so-called creator economy, and its approach to introducing ads to The Dispatch.
GroupM's Krystal Olivieri on advertiser support for journalism
I had a conversation with Krystal Olivieri, global chief innovation officer at GroupM, about whether advertisers would conveniently forget all those promises they made during flush times to support local news. The takeaway: Advertisers will cut here and there, and that’s outside of the control of publishers, but news publishers can help themselves by having better ways of showing the value they’re creating for advertisers. Check out the full conversation on this week’s episode of The Rebooting Show, followed by a discussion of the year ahead with Outbrain co-CEO David Kostman. Thanks again to Oubrain for the support. Appreciate it.
Substack's Reid DeRamus on newsletter growth mechanics
Substack’s Reid DeRamus talks about growing newsletter audiences. Reid and I have spoken for the past two years on this topic, going back to before Substack bought his company Yem, which was focused on building a growth engine for newsletter writers. The thing about growth, at least I’ve found, is it takes a long time for most people. It’s taken me over two years to get 12,700 subscribers. I always tell people to take with a grain of salt the overnight success stories of newsletters that amass 250,000 subscribers in less than a year. They are remarkable because they are unusual, and the people running them are likely experts in marketing while most of us writing are not.
Recommendations is Substack’s No. 1 feature it has rolled out. It needed to provide that distribution function to publishers. Otherwise it would just be a newsletter CMS with Stripe integration. Recommendations are now responsible for 40% of new free subscriptions to Substack-hosted publications. Reid and I discussed that dynamic and other features Substack is rolling out to increase the number of people who covert to paid subscribers.
How Local News Now puts community first
Scott Brodbeck got into local news a dozen years ago, after working in local broadcast news in Washington DC. “I looked at the direction of the industry and didn't love where local was going and ended up leaving and just on a total impulse to start my own site,” he said. “it was like a one day thing.” After this prototypical shower inspiration, Scott launched a local site to cover Arlington, Virginia.
Since then, Scott has built Local News Now into a clutch of local news sites for the Virginia suburbs near Washington, including ARLNow (Arlington), FFXNow (Fairfax) and ALXNow (Alexandria). The opportunity Scott saw was to make local news products that were different from the typical local news efforts from those coming from the newspaper industry. “The local news outlets that were focused on Arlington were meant for people middle aged and up, living in single -family homes and the more affluent parts of Arlington, Scott said of the time when he was in his 20s. “I wanted to launch something that was gonna speak to people my age.”
The Big Bend Sentinel's community approach to local news
In 2016, Max Kabat and Maise Crow moved to Marfa, a small arts town in west Texas, and a couple years later made a bold call. They bought the local newspaper, The Big Bend Sentinel. Ever since, they've been building out their take on a sustainable local news model by pairing the weekly newspaper with a cafe and events space. Max and I discuss the model, the challenges of operating entwined but separate businesses, and whether this could be a blueprint that could work in towns with similar characteristics as Marfa, a tourist town that attracts a flood of visitors every year. After all, most towns in America aren’t featured in Vogue.
Should the government "fix" local news?
There’s the understandable urge to “do something” to fix the difficult situation the news business finds itself in. Government intervention in markets has historically been less common in the U.S., but we’re in a time of aggressive industrial policy becoming the norm with measures like the Chips Act and the climate bill.
Enter the Journalism Competition and Preservation Act, a bill that was attached to the defense bill winding its way through Congress. The JCPA would force big tech platforms to pay local news publishers for the privilege of sending traffic to these publishers.
The measure, which at the moment has been removed from the defense bill although it could always get added back in upcoming the back-and-forth, has proponents who claim that it is a “lifeline” to local publishers by sweeping aside antitrust restrictions to allow them to collectively negotiate terms with big tech platforms like Google and Facebook parent company Meta. Detractors see a cash grab by local news chains that are often run by deep pocketed private equity firms. For its part, Meta has threatened to exit exit news altogether if the measure passes.
On this week’s episode of The Rebooting Show, I spoke to Chris Krewson, executive director of the Local Independent Online News publishers group, to understand the possible unintended consequences to the bill, which Chris sees as mostly benefiting incumbents, many of which continue to cut journalists as a result of bad business decisions. It doesn’t help that many legacy chains are owned by private equity firms that probably shouldn’t need government assistance.
The Mill's Joshi Herrmann on building profitable local news
Joshi Herrmann is the founder of The Mill, a newsletter focused on Manchester – England, not New Hampshire, for those who call it “soccer” – as well as sister publications in Sheffield and Liverpool. Joshi started The Mill in June 2020, and across the three newsletters, the company has 45,000 email subscribers and has converted over 7% to paid subscribers. The Sheffield Post has 12,000 email subscribers and has managed to convert an impressive 950 to paid, according to Joshi. The company is near profitability with a small full-time staff augmented with freelancers.
The common knock on the newsletter model applied to local journalism is that it can’t scratch much beyond the surface, and it tends to be mostly aggregation of original reporting still done by local newspapers, however depleted they are. The Mill and its sister titles are leaning on original reporting and in-depth features as opposed to just aggregation or fluff about local events.
Sebastian Tomich on The Athletic's pivot to ads
The Athletic started in 2015 with a simple proposition: It would produce the highest quality sports journalism with a subscription model that would align incentives with producing quality work vs chasing traffic. The approach wasn't without its flaws -- The Athletic consistently lost money -- but it did produce a differentiated, high quality product. In January, The New York Times bought The Athletic for $550 million. Nine months later, the Times, which has proven that advertising can co-exist in a subscription-first model, introduced advertising on The Athletic. Sebastian Tomich, chief commercial officer at The Athletic and a Times veteran, joined me to discuss the advantages of building an ad model from scratch and how The Athletic is seeking to align brands with sports affinity.
Ari Paparo on what's next for ad tech
Ari Paparo is a longtime ad tech veteran, not to mention holding the disputed title as Funniest Person in Ad Tech. Some highlights from our conversation:
Innovation requires fragmentation. Ad tech’s complexity is a longtime talking point. And it is undeniably a convoluted supply chain that’s given the veneer of plausible deniability to all kinds of corner cutting, at least in my experience as an observer for many years. But Ari points out that “innovation requires fragmentation,” and besides, many of those pushing an anti-complexity narrative just happen to have “anti-complexity solutions” to sell. Go figure.
Small publishers can opt out. Google is the simple ad tech solution. Most small advertisers can just default to Google and Facebook. But larger enterprises gravitate to more complexity simply because they have more complex businesses.
Apple overturned the industry. Cynical or not, Apple’s use of privacy to restrict data flows has upended how the industry operates and will operate going forward. It’s of course no coincidence that these privacy restrictions hurt their rivals in Meta and Google. “There's no love lost between those companies, so hitting them in the kneecaps was kind of fun,” Ari said.
Tangle's Isaac Saul on non-partisan news
Isaac Saul saw knee-jerk distrust in media firsthand as a political journalist at outlets like Huffington Post, where what he wrote would end up being distrusted based on the place it appeared rather than the substance. Three years ago, Isaac started Tangle with the idea that presenting both sides to news stories would appeal to a wide group of people. And that’s proven true. Today Tangle has 8,000 paying subscribers and nearly 50,000 free email subscribers – a 16% conversion rate is amazing. It is launching a new ad program to complement the $30,000 a month in recurring revenue it takes in.
Like Semafor, Tangle has its own spin on deconstructing the atomic unit of news, aka the news article. Tangle separates out the factual presentation of the issue, before presenting the view from the left, the view from the left, and then Isaac’s viewpoint. This is hard to pull off, particularly with issues like affirmative action, Covid-era school closures, and, of course, all things Trump.
“I am pretty politically incongruent. I try to go and understand, as a politics reporter, what's happening in the world. In order to get a balanced view of any single story, I would have to read 10 publications that have clear, diametrically opposed political leaning. I can't just read the New York Times. I have to read the New York Times news section and then go read the Wall Street Journal if I really want to get this full picture. And so I was like, there have to be other people like me out there. I figured if I could put all that stuff in one place, a lot of sort of politically open-minded people would read it.”
Big Technology's Alex Kantrowitz on where tech goes next
Alex Kantrowitz is the founder of Big Technology, an independent publication focused on he immense impact of tech companies on business, politics and society. A reporter covering tech for BuzzFeed News, he wrote a book on the tech industry called “Always Day One” and became one of the early trailblazers to decamp to Substack in 2020. Since then, Big Technology has amassed nearly 100,000 subscribers.
We spoke about his independent journey – and plans to start a paid tier to his newsletter – as well as the state of the tech industry at this pivotal time. Some highlights:Why a lot of the meltdown in tech valuations is a function of the Federal Reserve How Apple got away with kneecapping tech rivals under the guise of privacy Mark Zuckerberg’s ballsy bet on the metaverse Generative AI as a legitimate contender for the New New Thing Betting on yourself after seeing journalism businesses struggle
Producer: Jay Sparks of PodHelp.us
Semfor's Justin Smith on the need for a new global news brand
Semafor, backed by $25 million in private investment, has (finally) launched, marking possibly the most ambitious attempt in recent years to build a new global news brand. At the heart of the effort is an attempt to restore trust in media by rethinking the journalistic product. Despite the long history of failed attempts to "reinvent the article," Justin sees a glaring need to unbundle the article to clearly delineate factual news from analysis and opinion, while providing the context of the news along with countervailing views.
6am City's Ryan Heafy on building a sustainable local news model
6am City is turning to the newsletter to build out a network of 25 local news publications it says have 1 million cumulative subscribers and an open rate around 50%. After starting in Greenville, South Carolina, in 2016, 6am has expanded to markets like Madison, Wisconsin; Austin; Portland; and Indianapolis. The 6am formula is to keep new publications’ costs under $250,000, staff them with two-or three editorial staffers and four total employees, mostly making money from ads, both local and regional. It looks for markets based on a criteria developed, including income and education levels, inflows and outflows of residents, charitable giving and retail activity. It aims to get to profitability (and healthy 50% profit margins) in a market in two to three years.
Thanks to Jay Sparks from PodHelp.us for producing the episode.
TMB's Bonnie Kintzer on turnarounds
In 2014, Bonnie Kintzer was named CEO of Readers Digest Association, becoming its fourth CEO in three years as it emerged months earlier from its second bankruptcy.
After renaming the company Trusted Media Brands, recently shortened to TMB, Bonnie set out to decisively shift the company to a digital model while diversifying its focus to include its other lifestyle brands, such as Taste of Home and the Family Handyman. TMB added Jukin Media, bringing its streaming and video capabilities as well as brands like FailArmy and The Pet Collective.
“I had multiple steps that I shared with the entire company. Did we have the right people? Did we have the right culture? Did we have the right assets? Were there assets that we should bring into the company? What did we need to stop doing? Because I think when you're doing a turnaround, you have to really have an incredible amount of focus.”
Here’s Bonnie’s three principles for a turnaround:
Enjoy the process. Turnarounds can be grinding affairs, filled with their fair share of downs along with the ups. “You have to be a certain kind of person to like turnarounds, and you have to surround yourself with those kinds of people,” Bonnie said.”
Be decisive. Tough decisions are inevitable. Putting them off isn’t going to make them any easier.
Over-communicate. Change is hard and understandably unsettles people. “When I first got back, people didn't believe that we could do it,” she said. “It was about constant communication and proof points that all of a sudden people [believe] we can do it.”
The Rebooting Show is produced by Jay Sparks at Pod Help Us.
Platformer's Casey Newton on going solo
Casey Newton, a former writer at The Verge, started Platformer to cover the societal impact of the most powerful tech platforms. He’s used a subscription model, charging $100 a year. With 75,000 free subscribers and what he’ll only call “thousands” of paid subscribers – Platformer is the No. 2 most popular paid newsletter in tech on Substack – Casey has built a successful solo business that’s he’s expanding by bringing on Zoe Schiffer as Platformer’s managing editor. (He’s also got a new podcast coming out in partnership with The New York Times.)
Going direct. “The one thing I've learned from covering these social networks is you've got to stop yourself from having a middleman in between you and the audience. I’ve got to go get that direct connection. And there is no more direct connection than having your own business and selling a product for money.”
Subscriptions make the solo path easier. “It's ridiculously plug and play. It’s amazing to think that just by adding a subscription component to a blogging platform, you can enable hundreds, maybe thousands, of people to start their own successful businesses.”
Newsletters are more nimble: “The thing I love about new newsletters, in particular, is that they can evolve so quickly. If you go back to the five years that I've been writing a daily newsletter, now there are whole sections that used to be there that just aren't there anymore. And it's totally fine. Whereas like you work for a website, if you want to redesign it, give yourself two years. My newsletter can just evolve.”
The indie path is niche. “My hope was that two years on so many more people were going to do this. I spent that first year that I was independent talking to so many boldface name reporters at The New York times, The Atlantic, you name it, because they were all thinking about doing the exact same thing. I was trying to encourage them to do it because I was having so much fun with it and it was succeeding, but so very few people pulled that trigger. I think individually, they all had good reasons. But I have been shocked at how few people, relatively speaking, have followed. Most people have really wanted the comfort, the stability of that standard media job.”
Introducing the People vs Algorithms podcast
This is a preview of a new weekly podcast I’m doing with Troy Young. The People vs Algorithms podcast will focus on patterns in media, business and culture. Each episode will revolve around themes. This week, we tackled the theme of whether media is better now than in the past, along with an exploration of the type of media that’s winning in this kind of environment. It’s narrower, more focused, more niche. Subscribe to People vs Algorithms on Apple or Spotify.
Flying's Preston Holland on using media to build a real estate development business
Flying, a 95-year-old magazine publisher focused on amateur pilots, is on this path. Craig Fuller, CEO of Freightwaves, bought Flying in July 2021 and a key part of the growth plan he and COO Preston Holland have begun is a massive bet on so-called air parks, basically resort communities with ample space to park your plane at your home. The Fields is a 1,500-acre development in Tennessee’s Sequatchie Valley that’s due to open next year. Plans call for 800 homes, 180 “vacation villas,” a runway and many private hangars for people to park their aircraft. The Fields is billed as “a luxury fly-in community for pilots, by pilots.”
The approach is somewhat akin to how Freightwaves uses its media arm in order lower the acquisition costs of its data business. Done right, this allows for taking a longer view of the value of different content products. For instance, Flying’s new management decided to keep the print edition and double the production cost to improve the quality.
“Marrying [editorial] with some other monetization strategy allows for you to make some decisions on the media side that you wouldn't necessarily make if you're trying to make all your contribution [margin] on the media side," Preston said.
The Future playbook for sustainable publishing
Future is a collection of over 200 specialist titles that range from gaming and tech (Tech Radar) to homes (Homes & Garden) to beauty and fashion (Who What Wear) to B2B (SmartBrief), Future has established itself as one of the UK’s most successful publishers. (Its current market capitalization puts it at 8x the value of BuzzFeed.) But for its future growth, Future is betting heavily on the U.S. market, which CEO Zillah Byng-Thorne noted to me is five times the size of the UK. The U.S. already represents 35% of Future’s audience as well as 38% of its revenue.
Byng-Thorne is something of a newcomer to the media business. An accountant by training, she joined Future in 2014 as its interim CFO and soon was appointed CEO, tasked with turning around a magazine publisher that, like its peers, was struggling to make a transition from print to digital. Her turnaround plan – she initially cut 40% of employees as the company was recording a £35 million loss in 2014 – has become something of legend, setting the stage for a remarkable financial turnaround as Future became an early adopter of using its niche focus in high-intent categories to drive transactions. The shift to commerce – it is now 34% percent of Future’s revenue – was informed by her previous time at Auto Trader, which made the leap from car magazine to marketplace.
Zillah recounted how her first year at Future, which was on what she describes as a decade-long decline, the key question to answer was: “What’s our right to exist?” Her conclusion: Put the company on firmer financial footing, double down on the expertise embedded in the brands. Future was struggling with the transition from print to digital when Byng-Thorne took over. Beyond that, the diversification needed to be done on the digital side as well since many publishers were overly reliant on digital advertising. Commerce was a way to make money from audiences without the ups and downs inherent to the ad business. Future’s revenue is now roughly split in thirds among advertising, commerce and direct revenue from the audience. Having an acquisitions playbook. Future has spent over £1 billion on acquiring companies since Byng-Thorne took charge. In the past year alone, it has acquired four companies, including Who What Wear and Dennis Publishing and MarieClaire.com. “We integrate fully. I know some of our competitors don't all integrate fully, but for us, it was really important that it's one Future, one tech system, one sales team, one way of working.”
This episode was produced by Jay Sparks from Pod Help Us. If you have podcast production needs, get in touch with Jay.
Trapital's Dan Runcie on building a brand at the intersection of business and hip hop
The business of hip hop is often overlooked, even though it's a massive business with outsized cultural influence. Dan Runcie saw this as an opportunity, starting Trapital in 2018. I wanted to talk to Dan about his approach to building an independent media brand. He’s already established himself and Trapital as an authority on the hip hop business. Trapital now has over 16,000 subscribers, with the publication supported almost entirely through sponsorships. Dan had earlier done a paid model, but pivoted to free when realizing he could reach far more people without the friction of a paywall – and a value proposition that appeals to sponsors like Moonpay, Convertkit and Alts..
Some takeaways from our conversation:
Hip hop punches above its weight. There’s a school of thought that niche business publications are best in “unsexy” areas, as Industry Dive showed in its focus on big nuts-and-bolts business sectors. But cultural industries have influence beyond their size.
Trapital isn’t about news. Dan has made a point of saying what he does is not journalism but business analysis. Part of that is to be clear the product isn’t a tool for keeping up to date on the ins and outs of the industry. Instead of the play-by-play, Trapital focuses on the context with Stratchery-like essays on topics like “how The Weeknd mastered his brand” and “Beyonce’s streaming strategy, explained.”
The pivot from subscriptions. For the past couple years, all roads have led to subscriptions in publishing as the travails of the big digital publishers have cast a pall on the ad model. But as Industry Dive, Axios and others have shown, advertising can be the great focal point of a publishing business model – if the audience is a group that’s hard to reach and valuable. In 2018, Trapital scrapped its initial paid model. Often subscriptions are painted as a set-it-and-forget-it option, but making money is hard no matter the model, and subscriptions require constant selling and marketing. Dan saw as a one-person operation this was cutting into his focus. Instead, Trapital focused on an “influence” model that initially treated the newsletter and podcast as lead gen for consulting, while adding in advertising and moving into investing.
Going beyond solo. Trapital is working as a one–person business, but Dan wants to expand beyond just himself. The challenge is how to do this without losing the personal touch since Trapital’s brand is very tied into Dan’s perspective.
How Litquidity memed his way to a $2m media business
Begun as a meme account in 2017, Litquidity has amassed 1 million social media followers across Instagram, Twitter, LinkedIn and TikTok, specializing in the dark arts of “dank memes” that poke fun at the weird world of finance. The account, run pseudonymously by a former trader who goes by Lit, has spawned a daily news summary email (Exec Sum) with 160,000 subscribers, podcast (Big Swinging Decks), investment fund, merch and more, as part of a $2 million business. Some key takeaways:Find underserved audiences. The world is not short on finance news. But what Lit found as a young investment analyst is that little of the coverage captured the experience of being in the (well-compensated) rank and file of finance. “One thing that I felt was lacking was real insider baseball-type humor,” Lit said. “You look at CNBC or Bloomberg, it's probably people who aren't insiders that are reporting on the news or talking about the stock markets.” Memes are top of the funnel. Litquidity began as a meme account, attracting advertisers as its revenue source. But Lit felt that could only go so far – “I don't think they're like the highest value monetization paths to go through because you'll saturate your audience with ads, and people hate ads” – so he spun off Exec Sum, a newsletter that pithily summarizes the days finance and markets news. And more importantly, provides valuable surface area for high-value ads. “I really thought of how can I provide value to my audience in a way that would also make sense monetarily.” Publishing and investing mesh. Like Packy McCormick and Anthony Pompliano, Lit sees the opportunity to use his publishing reach as a way to expand his investmenting by raising a fund. Eventually, he sees Liquidity as more of an investment fund with a publishing arm rather than vice versa. “That's how I want that to be viewed going forward as I continue to build out the credibility and the track record.” Expanding beyond a personal brand is hard. Recently, Litquidity lost its “only employee” – there are a handful of part-timers – when Mark Moran split to focus on an investor relations play, Equity Animal. Expanding a media company tied to a person, even one who uses a pseudonym, is tricky. “One of the things that I found difficult was having the entire brand being ied by my humor and my voice,” he said. “If you start to introduce other creators or elements who don't fit that, then it starts to dilute that brand.”
The Hustle's Jordan DiPietro on being a publisher inside a software company
In February 2021, marketing software company HubSpot bought popular business newsletter The Hustle. Jordan DiPietro, a veteran of The Motley Fool, joined HubSpot to run The Hustle just after the acquisition, after having spent time advising the company. The Hustle now claims 2 million subscribers to its daily email, which gives a meme-friendly dive into business news topics. DiPietro said being part of the marketing operation of a brand helps The Hustle take the long view. “Being in the publishing game, when you're focused on ad dollars, that is a grind. The Hustle had [subscription service] Trends and, and certainly our plan was to accelerate the growth of Trends, but still a lot of our revenue came from advertising and that's just a different beast. Once it was acquired by HubSpot, the pressure to sell external ads was off, but instead to focus on being our own media buyer was attractive, especially knowing the business model behind HubSpot and the capital and the resources that HubSpot had.”
Thanks to Bombora for supporting The Rebooting and sponsoring this episode.
Money's Greg Powel on intent media
One of the most solid areas of digital publishing is what’s become known as intent media. In the old days, we called this “SEO.” The basics are taking service content and applying it to algorithmic distribution (usually Google) and marrying it with performance advertising models like affiliate marketing programs that pay for sales leads.
Ad Practitioners is another intent-based publisher in expansion mode.In late 2019, Ad Practitioners bought Money.com from Meredith with the plan to run its intent playbook with the personal finance brand. That means more lists of the best credit cards, best savings accounts and, yes, the best pet insurance companies. The entire company, which is based in Dorado, Puerto Rico, is 160 people and generates over $100 million in annual revenue.
Some takeaways from Ad Practitioner CEO Greg Powel:
Arbitrage works. Paid acquisition is an important part of the Ad Practitioners model – it has spent about $500 million on Google ads in its history. Search for “best credit cards 2022,” and you’ll see why. This kind of high-value intent traffic is very valuable – credit card leads can fetch $100 – that it makes sense.
Bad sites are a business model problem. Publishers with terrible websites do not have a tech problem; they have a business model problem. The attention-based ad model for general audiences is hard to make work without adopting, well, adversarial tactics. The performance ad model of intent media aligns incentives better since the publisher wants people to get the information they need rather than hijack their attention elsewhere.
Algorithm dependence is a manageable risk. To put it mildly, there’s a checkered history of publishers relying on algorithms for the overwhelming majority of their distribution. Ad Practitioners look to mitigate that dependence with its paid acquisition as well as licensing deals with the likes of MSN and others. While new channels like TikTok could catch on to eat into Google’s search share, Greg sees the biggest threat of disruption coming from Apple, since its devices are the originator of a big chunk of Google searches.
Workweek's Adam Ryan on why B2B shouldn't be boring
Adam Ryan, former president of The Hustle and cofounder of Workweek, wants to rethink the B2B model. Workweek is banking on finding individuals – creators, if you will – to build audiences around. The bet is that individuals, particularly but not exclusively those who are practitioners in the field, can build deeper connections with audiences while benefiting from the infrastructure, services and halo effect of a parent media brand. Some highlights from our discussion:
Don’t raise too much money. Adam spent part of his career at Spiceworks, a professional network for IT professionals. The company identified an underserved community and executed on the opportunity, only to have an unsatisfying outcome. “It was a great company, bad cap table,” Adam said. “They actually made a ton of money. They didn't need to raise that much money. And then because they did, they made terrible decisions, long term.”
You can be professional and have personality. Workweek is leaning on its network of 19 creators to be front and center. It doesn’t have an editor-in-chief and instead relies on its newsletter writers to chart their own path that hews closely to what motivates them. Nicole Casperson, for instance, writes WTFintech and focuses often on diversity and inclusion issues that are important to her personally.
Sector expertise is critical. Not all Workweek creators worked in the fields they cover, but many do. Workweek writer Nik Sharma, for instance, is a DTC marketer. This hands-on familiarity with the issues in these fields in invaluable, so long as it is also married with the ability to clearly communicate and consistently produce valuable pieces. “The reason why [B2B content] is kind of boring is because you have a lot of people that have never done those jobs,” he said . “They're just like listening and regurgitating. They're not like coming from a point of action.”
Paid acquisition is more than a shortcut. Publishers used to have an aversion to admitting to buying traffic. I can remember BuzzFeed making sure to point out it only bought ads for its sponsor content, not editorial. But Adam saw how an effective paid audience development strategy can accelerate growth. For instance, Workweek’s The Marketing Millennials property grew by 7,000 newsletter subscribers organically in seven weeks while paid acquisition added 20,000. So long as a company is confident in its cost per subscriber number, and is focused on quality of acquired subscribers, paid acquisition is an important tool. Overall, Workweek pays to acquire nearly half its overall list at an average cost of $10 per subscriber.
You need connective tissue. Workweek has cast a broad net in its first eight months of existence, with newsletters focused on everything from cannabis to fin tech to memes to franchises to marketing. It has since refined the model around “pods” of core categories. Workweek has clusters around areas like startups and investing, health, marketing and fintech. “It just allowed the business to focus on marketing allows our business to essentially have more efficiencies,” Adam said.
Human Ventures' Joe Marchese in defense of the bundle
The pendulum always swings. Media regularly oscillates between periods of bundling and periods of unbundling. Bundles tend to rub people the wrong way because they feel they pay for stuff they don’t want. The downside is unbundling can be a complete hassle and the supposed savings quickly evaporate. Just look at what you’re paying now for various streaming services (themselves mini-bundles) instead of cable service. Inevitably, whether it’s the proliferation of newsletters or the many streaming products, we’ll see rebundling take off.
“The bundle was the absolute worst form of entertainment delivery, except for every other one,” said Human Ventures executive chairman Joe Marchese. “Consumers are looking for a rebundle and these streamers are gonna have some sort of rebundle coming. News and Substack has some sort of rebundle coming. Everything that's old is gonna be new again over the next couple of months.”
Other topics:Media is often a terrible standalone business but is good support for other businesses. The TV business is now dominated by tech companies, a trend likely to continue. That isn’t particularly new. “Media has historically been owned by non-media businesses,” Joe notes, going back to early radio and then cable systems owning TV networks. “The business of media has outsized influence but undersized monetization.” The result: “I don’t know the media business works at scale without alternative models.” The "permission to curate" is powerful. In a world of near-infinite media choices, people need some way to make sense of what’s good and what’s bad. That’s where trust comes into play. People can turn to algorithms like Google’s or Facebook’s to make sense of what’s important to them, or they can turn to publishing brands and individual brands. “Brands matter for the curation of goods and services so that people don't have the paralysis of infinite choice,” Joe said. Not everything is performance advertising. With ample data, sophisticated targeting and analytics, it can sometimes seem that brand advertising is an anachronism as the media world shifts firmly to “performance advertising,” or what used to be known as direct response. “In a world where we have dynamic targeting and we know what each household is watching, the advertising experience is actually worse,” Joe said. “How did we get worse at advertising in a CTV advertising environment than broadcast television 40 years ago?”
Neil Vogel on Dotdash Meredith's best, fastest, fewest strategy
Everyone loves a comeback, but few companies get them in the consumer internet business. ( Most companies have peaked and then set course on inevitable decline, with new owners either milking the asset on the way down or floundering unsuccessfully to reinvigorate the asset. That’s why it’s noteworthy what IAC has done with Internet 1.0 stalwart About.com. It was a company long past its peak in the first phase of digital publishing, having begun all the way back in 1994 as a place to find “expert” answers. Some takeaways from our conversation:Having a good user experience doesn’t have to come at the expense of the business. Media is hard. I always mention how difficult it is to satisfy different constituencies: audience, advertisers, algorithms. Dotdash has proven that you can have fewer ads, faster sites and better content and still make more money. Print still has an important role. Everyone likes to call things dead, and print isn’t going to be the driver of many media businesses going forward. But it still plays a role. I think it’s a good sign that someone like Neil is bullish on print, run efficiently, doing the job of being a statement of the brand. Driving transactions is critical, but maybe not building products. There’s lots of talk of commerce media here in Cannes. Publishers have seen their commerce businesses as bright spots. Dotdash has a large chunk of their business in driving transactions. Still, Neil strikes a note of caution when discussing turning that into actually making products versus passing on customer to product companies. These are often different businesses.
Tortoise Media's Katie Vanneck-Smith on slow news
Katie Vanneck-Smith, formerly president of Dow Jones, co-founded Tortoise Media, a UK-based publisher dedicated to “slow news.” The problem she and her co-founders diagnosed: “The problem isn’t just fake news or junk news, because there’s a lot that’s good – it’s just that there’s so much of it, and so much of it is the same. In a hurry, partial and confusing. Too many newsrooms chasing the news, but missing the story.”
The slow approach means that Tortoise confines itself to producing one podcast episode a day, one daily newsletter (in email and audio), one multi-part series per month and one book a quarter. Katie discussed the Tortoise approach in an on-stage conversation at the FIPP World Congress in Cascais, Portugal.
Outsider CEO Deirdre Lester on building a lifestyle brand
Outsider is a media and commerce brand focused on a particular view of “the American lifestyle” that, to me, takes its cues from the South, emphasizing college football, hunting, fishing, wraparound sunglasses and the like. Recently, Deirdre Lester moved from CRO of Barstool Sports to become the CEO of Outsider. The goal is similar to Barstool: Use personality-driven publishing – former NFL QB Jay Cutler is chief design officer at Outsider – to build a deep connection with a like-minded community, then complement the media with commerce operations. Some key takeaways from our conversation:
Finding the sweet spot between individuals and institutions is a big opportunity. The unbundling of publishing has put the focus on individual creators, but there are only so many Mr. Beasts in the world. The more tangible opportunity is the Goldilocks approach with institutional brands that can tap into the power of individuals to establish tight ties with an audience. Outsider is doing that with Cutler and popular podcaster Marty Smith.
Lifestyle publishing brands are more about AOV than CPM. Publishing has been stuck in a default mindset that the audience either pays with data and attention to ads or with money through subscriptions. Commerce – real commerce, not just affiliate links – offers a third way to build product companies with media used for efficient distribution and, ideally, premium pricing power based on the credibility established with customers.
Doing both media and products is hard. These are different businesses with different dynamics. The rough patch hit by Food52, a prime example of publishers pivoting to product, shows how difficult it is to manage both publishing and products. Publishing is all about managing conflicts, and that can get even messier when publishing is in the service of moving products.
Time's Keith Grossman on why Web3 is here to stay
The crypto winter has pitched the giddy excitement over the endless possibilities of Web3. The drumbeat of negativity hasn’t shaken Time president Keith Grossman’s confidence in Web3 providing a new path to sustainable business models. Time, now under the ownership of billionaires Marc and Linda Benioff, has become the most aggressive large publishing brand in exploring the possibilities of Web3. To date, Time has:Minted iconic covers as NFTs and generated nearly $500,000 in proceeds Collaborated with artists to reinterpret Time covers as part of the Timepieces Web3 community Dipped its foot in the metaverse with a Galaxy Digital deal to create a metaverse newsletter and a metaverse category of the Time 100.
“I started to see collaboration. I started to see Web 2.0 is about the audience, but Web3 is really about community,” Keith told me on this week’s episode of The Rebooting Show. “I started to see a different way in which brands could evolve. “
Morning Brew's Austin Rief on the creator economy
Morning Brew is a breakout success in digital media, turning an email newsletter of business news delivered with a witty tone, into a robust digital media business that now has over 4 million email subscribers, with another 1 million to its growing stable of vertical industry email newsletters.Now, Morning Brew is focused beyond its original product, the daily Morning Brew publication, by building a roster of five B2B offshoots, with two more in the works, in addition to podcasts and video shows. A key growth area: individual creators. The bet: Morning Brew can use its infrastructure – editing, production and, crucially, monetization – to partner with creators who don’t want to do it all on their own.
Permutive's Joe Root on the pivot to privacy
Since its founding eight years ago, Permutive has bet on privacy being a key consideration in the future of ad tech. Permutive CEO Joe Root delves into what privacy-conscious advertising looks like – and if it’s possible. Highlights:
The GDPR was a harbinger. Most U.S. companies didn’t understand how far-reaching the General Data Protection Regulation would be to them. The landmark move to rein in the collection and use of user data without consent is not without its critics, but it set in motion a focus on privacy that led to Apple’s move to crack down on data collection and the ultimate end of the third-party cookie.
U.S. dominance in digital markets is ending. The tech industry has been mostly an American creation, dominated by U.S. platforms and largely operating along the extreme free market proclivities that are a hallmark of American capitalism. But Europe remains a regulatory superpower, and it is determined to use those powers to shape digital markets.
Consent – real consent – is inevitable. Clicking out of endless cookie consent pop-ups is a wonder of traveling in Europe, on par with being able to take a train to the airport. The GDPR led to these consent requests as ad tech’s response to the regulation, giving the appearance of consent but not really. That’s going to change.
Context is having a moment. The original targeting signal for advertising was context. Someone reading Field & Stream is likely into the outdoors if you’re selling fly-fishing gear. Digital advertising shifted to taking all kinds of signals in order to target ads to individuals. With the collection and application of other signals growing more difficult and expensive, the pendulum is shifting back to contextual signals.
Big publishers stand to benefit. The new era of digital advertising will have winners and losers, with many still to be determined. One divide that will likely open is between the biggest publishers that have enough user data of their own to be compelling to advertisers who can’t simply rely on the cookie targeting and the long tail of sites that will likely find competing for ad dollars far more difficult.
Forbes COO Jessica Sibley on "the brand that stands for success"
Forbes is a unique brand that has global cultural cachet that’s managed the transition from being a magazine business to a mostly digital business, with an emphasis on building its direct revenue as well as its brand extensions. Now, it's looking to plot a future business in which consumer revenue take a far larger role.
Why The Dispatch is leaving Substack
Many would assume the most popular political publications on Substack are culture war agitators like Matt Taibbi and Glenn Greenwald. In fact, the top two slots are much milder publications: Letters from an American and The Dispatch. Taibbi and Greenwald will be moving up a slot soon, since The Dispatch is leaving Substack.
Steve Hayes, one of the founders of The Dispatch in 2019, said the conservative news and commentary publication has outgrown the tools that Substack provides. Part of this is ideological – not in the political sense – in that Substack has squarely cast its lot with individual creators, doesn’t believe in advertising, and wants to be a platform rather than a backend tool.
“There was a certain point when they were seeing the success that they were having by focusing on individual content creators, and said, we need to do more of this. And there came a point, when their growth, which was just monumental and what they were doing to get that growth, didn't work for us as much as it had in the past.”
Businesses are all about making choices. And ultimately you can’t please everyone all the time. That said, I think Substack is at risk of losing many of its initial wave of successful publishers, particularly as upfront deals end and the pinch of paying 10% of revenue. (The Dispatch had a “handshake agreement” with Substack and didn’t get a special deal, according to Steve.)
The shift to individuals from institutions has been a major catalyst of publishing’s unbundling, but I believe we’ll see more confederations between individuals, sometimes just a gussied-up regular company and other times in new collectives. That’s because working with others tends to be more enjoyable for most people. What’s more, being part of a group means you can have someone to cover up for your inefficiencies or allow you to take a vacation. There’s still strength in numbers. What’s more, bundles are often better for customers.
Steve and I discussed how The Dispatch plans to expand beyond its 30,000 paying subscribers by adding in advertising and events. We also discussed building a center-right political publication at a time of extremes, and I tried but mostly failed to get him to give an optimistic view of what’s to come in U.S. politics.
Check out the full podcast on Apple or Spotify. Thanks to House of Kaizen for its support as presenting sponsor.
Publishing as a sales tool
This week, I spoke to Anand Sanwal, CEO of CB Insights, about how it uses its popular email newsletter as a customer acquisition tool for a software business. Also: Where Quartz went astray and how access is a subscriptions driver.
More companies than ever are intrigued by building their own publishing arms, seeing an opportunity to lower customer acquisition and marketing costs. After all, in an age of “going direct,” why should companies not build media arms?
As was once said to me about communism, great on paper, messy in reality. Time and again, companies have talked a big game about building their own media arms only for the initiatives to peter out, flame out or just languish. The latest cautionary tale comes from Netflix, which drastically cut staff last week at its ambitious (relatively speaking) publishing site, Tudum, which only debuted in December 2021.
The cuts come six weeks after Netflix CMO Bozoma St. John departed the company – and at a time when Netflix is shockingly talking about reining in spending as subscriber growth hits a wall and goes in reverse. But in truth, Tudum was likely doomed from the start, despite hiring top-flight talent and promising them editorial freedom with tech company pay. One media exec responded to my text of the news of its demise this way: “Who needs this?”
That’s a basic media question that marketers often don’t ask. And most of these forays into brand publishing come out of marketing departments. Finding recaps and cultural takes on TV programming is not hard. Sure, you can personalize Tudum with your Netflix credentials. That’s not a ton of added value.
Publishing can be very useful for subscription services as both a customer acquisition tool and marketing vehicle. On this week’s episode of The Rebooting Show, I spoke to Anand Sanwal, CEO of CB Insights, which uses its 800,000-subscriber daily email list in order to fuel a high-priced data subscription service that often goes for $60,000 per year. What CB Insights has learned:
Be realistic. CB Insights doesn’t claim it wants to take down The Wall Street Journal. It isn’t trying to build out a massive newsroom. (Anand says it has “0.5” employees devoted to it.) Instead, its goal is clearly to introduce people to the CB Insights brand and give them a taste of what its private-company data insights. Compare that with Coinbase claiming it was going to “combat misinformation”
Human ad products
Human ad products
Building a good media product is endlessly difficult, particularly when it comes to advertising. Math gives way to physics when ad products are built, as the complexities get ramped up, trying to satisfy financial goals, performance, audience needs, the overall brand mission, not to mention the challenge of balancing unique ad products with repeatable (and high-margin) ad products. Too often, that’s resulted in an adversarial approach to monetization that seems to operate in a parallel universe to the the stated ethos of the brand. If you’re going to claim to be high end, it’s hard to then turn to bottom-of-the-barrel monetization methods.
The shift to primary-engagement media is an opportunity to rethink monetization products. The success of newsletters and podcasts ad products has mostly been due to ignoring the typical monetization methods of other digital media. Running banner ads in email newsletters doesn’t work as well as hand-crafted ads in the voice of the publication, particularly if delivered by an individual. The same holds true for a personal publishing medium like podcasting, which has long relied on host reads. These are more human ad products, playing into the “casualness” that’s eating the world.
Litquidity, which is aiming to more than triple the $1 million in revenue it reached last year, has rolled out an interesting new product in which it will co-host earnings calls for companies on Twitter spaces. Litquidity began as a popular finance meme account, and has since expanded into a daily email newsletter with more than 120,000 subscribers, a podcast, mech operation and investment portfolio. Litquidity has signed up RCI Hospitality, operator of dozens of nightclubs and strip clubs, to host RCI’s investor call on Twitter Spaces. For RCI, this is an opportunity to reach a new class of retail investor and younger finance pros who aren’t the type to dial into the normally dull investor calls where analysts love to repeat “great quarter, guys.”
Brian Hanly, CEO of Bullish Studio, which works with Litquidity on growth and monetization, estimated investor relations to be a $1 billion-$3 billion market, with 4,200 public companies spending on average $800,000 on IR. Those budgets are an attractive target, particularly for smaller public companies that do not generate the equity analyst coverage of more high profile companies. RJI, for instance, has just three equity analysts covering it.
“Their last earnings call had 100 people,” said Mark Moran, head of growth at Litquidity who will host the RJI call. “One of my tweets about this [program] reached 200,000. We can confidently say we’ll get more than 100 people.”
House of Kaizen brings together leading minds and proven practices to help subscription product teams get ahead, fast. Their SubscriptionWorks program is designed to inspire and upskill your internal team with training, events, best practices and on-call consultation that addresses your current opportunities. House of K
The future of work
That’s why I find the scramble to own the future-of-work category fascinating. Jay Lauf, a cofounder of Charter, a new brand exploring the transformation of work, joined me to discuss how this bootstrapped media company is taking a different path than his previous executive roles at Quartz, The Atlantic and Condé Nast.
“We've run these workplaces,” Jay told on this week’s episode of The Rebooting Show. “We've thought about these workplaces, and we've served different roles within these workplaces. We've been our own test lab in some ways, both prior in our careers and currently, trying to build this out.”
Start with an idea. Jay talks about how he and co-founders Kevin Delaney and Erin Grau all felt like they were “scratching an itch.” Media born from a legitimate interest tends to be more valuable than engineered media that looks for an arbitrage opportunity.
Find a high-value area of need. The upending of the work routine during the pandemic was unprecedented. Human resources issues have gone from the sideline to a central organizational challenge.
Embed in a community. Charter is both covering the future of work but also living it as they build their own workplace. Being both a participant and observer is a powerful combination.
Ads and subs aren’t an either-or proposition. Charter wants to develop a business model mostly reliant on direct payments. But that doesn’t mean it is averse to ads. In fact, ads are the majority of its revenue as it determines the best direct-revenue model.
Check out the full episode on Apple Podcasts or Spotify. Let me know what you think: firstname.lastname@example.org. Thanks to House of Kaizen for its support.
House of Kaizen is an extension of your subscription revenue growth team. Decades of subscription growth experience are brought to bear to get you where you want to be faster with more confidence and efficiency. House of Kaizen works alongside your team to discover, ideate and execute experiments for sustainable growth.
In-House support: When your team needs augmentation, House of Kaizen is there for you. Through collaborative execution and in-depth training, the House of Kaizen team will help improve, expand, and support your expertise and in-house capabilities.
Independent media in Ukraine
The war in Ukraine is now six weeks old, likely to drag on even longer. It’s important to consider how vital an independent and free media is to a free and independent Ukraine. I visited Kyiv in the fall, and I wrote about how the media operates in a far more complicated context there than in a place like the U.S.
This challenge got greater in the wake of an invasion that’s mostly ground the economy to a halt. Andrey Boborykin, executive director of news outlet Ukrayinska Pravda, told me on this week’s episode of The Rebooting Show that the independent news media in Ukraine for now must rely mostly on grants from foundations and individual contributions from abroad. (Ukrayinska Pravda is also now publishing in English.)
“We are in a very tough position when we speak about reader revenue, because here we are competing with expenses for food and transport and utilities,” he said. “We don’t have the culture of people paying for content.”
We spoke about his own experiences being displaced in Ukraine twice, as well as how Ukrayinska Pravda is continuing its operations. I wanted to have Andrey on to bring attention to the threat to sustainable and independent media in Ukraine. Andrey and Eugene Zaslavsky of the Ukraine-based Media Development Foundation have set up a local news emergency fund to help independent media in the country get over to the other side of this tragedy.
The institutional-individual divide
The shift from institutions to individuals is happening in many areas of the economy and society. The Economist noted that influencers were “initially dismissed as credulous Gen-Z folk who had mistaken posting selfies for having a job” rather than being the entrepreneurs they are. The same is happening as the media business itself goes through a reorganization that shifts more power to individuals. Dean Baquet’s get-off-Twitter missive to his newsroom can be seen in this light. Reporters should be out reporting, not tweeting all day and having their viewpoints trapped in the Twitter bubble, not to mention the fact that many NYT journalists are “bad at Twitter.” (Starting a Twitter fight is like engaging with a mascot at a sporting event: Impossible to emerge from the encounter looking good.) The Times is in a unique position to be able to set its own expectations as a brand that employs individuals. Other publishers will have a tougher time.
The return of Covid (again) and events
Surprise, Covid is back — well, it never went away. Case numbers have been spiking in Europe, and they’re starting to rise again in many places in the U.S. The Gridiron Dinner, a regular social gathering of Washington powerbrokers, turned into something of a superspreader event<
Water & Music’s Cherie Hu on going solo
Niche publishing brands are most powerful at intersections. For Cherie Hu, the founder of Water & Music, the intersection is music x technology x business x web3.
Water & Music was an accidental brand in many ways. Cherie was a freelance journalist in 2016, relying on writing assignments from established publications like Billboard, Forbes and industry trade publications. Freelancers were the original creator class of journalism, well practiced in juggling the actual writing with figuring out taxes, chasing down invoices and, yes, tending to their personal brands in order to get the next assignment. Cherie created an email newsletter in 2016 to distribute her latest stories and added pieces she wanted to write anyway without waiting for a publication to run them. The newsletter became a creative outlet.
It grew enough that Cherie moved it to Patreon, and by early 2019 it had attracted 5,000 free subscribers. Water & Music is now off Patreon and boasts over 2,000 members. It is also pioneering experimentation in web3 models with its own research-oriented decentralized autonomous organization and a $STREAM token.
My takeaways from our conversation:
Look for signals beyond analytics. Understanding whether you have the publishing equivalent of product-market fit requires looking for signals. Some are simple math: email subscribers, open rates, paying members, ad demand. But some are intangible, like people reaching out to you, asking how they can support your work and seeing people at conferences who are obsessed with the subject matter and want to connect to each other. “I realized that there are a lot of these readers who would have such amazing discussions with each other, but they just did not know each other.”
Autonomy is more than money. Water & Music really took shape as a brand when Cherie started treating it as a creative outlet rather than a promotional vehicle. The individual-led brand allowed her the freedom to “have the kind of career that would allow for the kind of work that I wanted to do.”
Build a team. One of the false dichotomies is this idea in the unbundling of publishing that you’re either all on your own or buried in a legacy news organization. At some point, everyone needs to build a team, even if the relationships are more flexible than a typical company. “I absolutely cannot do everything that is happening at Water & Music just by myself, especially in terms of how I want the community and the brand to grow.”
Embed in a community. Just reporting the news is a commodity product. The way out is to provide extra value in the form of analysis and insights, while positioning yourself at the center of a community that wants to connect with each other. “If you're trying to build some kind of media business, there has to be some deeper layer around it, whether it's building a community or even just providing context or analysis.”
Check out the full episode on Apple Podcasts or Spotify. Let me know what you think: email@example.com.
I don’t know how many times over the years I’ve been called cynical. I
How Skift survived Covid
For Skift that meant shrinking its business, letting go and furloughing employees, and preserving cash to weather the storm. Skift used the pandemic to refit its business, casting off the expenses of offices and event venues, and building new high-margin products. Skift is more profitable now than it’s ever been. It has just crossed its employee count from pre-pandemic, even as Russia’s invasion of Ukraine, Covid outbreaks in Asia and a new Covid variant circulating Europe signal even more turbulence ahead. Some takeaways from our discussion:
Apply a consumer lens to B2B. Modern B2B is as audience-focused and quality as consumer media. That means investing in design, quality reporting and writing, and outlook. Travel was historically broken into sectors – flights, hotels, cruises, meetings – but that’s not how consumers approached the category, so Skift took the POV of people, not vendors.
Media and data make sense together… on paper. In media, the cliche “Uber for X” pitch is the “Bloomberg for X” pitch. Using publishing as a top of the funnel for a high-priced, recurring revenue data business is a business school case study. The problem: These are very different businesses to staff and run. Skift originally cast itself as a “travel intelligence company,” but ended up being a media company.
Covid expanded the talent pool. Skift used the pandemic to become a permanently distributed company. As it has hired people back, of the 20 people brought on, only one has been based in New York City. That’s led to a great expansion of its talent pool, not to mention a lower cost base.
Covid changed the client base. The travel industry was on mothballs for much of the pandemic, but Skift found that it was buoyed by the windfall realized by large tech platforms. Much of B2B media business models are driven by vendors, but the big tech platforms are where properties want to get for their stability and massive marketing budgets.
Balancing the revenue portfolio. The goal for Skift’s revenue profile is to be evenly split among events, advertising and subscriptions. Going into the pandemic, subscriptions were lagging a category like events. Now, with advertising on a hot streak and subscriptions coming back, Skift has seen subscriptions rise to 20% of revenue.
Check out The Rebooting Show on Apple or Spotify. Also, if you’re an Apple user, please leave a rating and review. Let me know what you think of the episode by hitting reply.
A key part of primary-engagement media is getting the cost base right. Publishers often have to do so many things to make money that the expenses in the organization tend to go in many places other than the actual creation of content. Fixing that imbalance is key for building sustainable publishing brands.
Manufactured growth vs organic growth
Jarrod Dicker's sane person's guide to crypto
Going down the rabbit hole with TCG’s Jarrod Dicker
Individual brands in publishing
Company teardown pieces
The pivot to pragmatism, web3 edition
Crypto is polarizing. Talk to a web3 trust believer – I define web3 as encompassing crypto currencies, blockchain, decentralized finance and non-fungible tokens and decentralized autonomous organizations – and you’ll hear we are on the cusp of a blockchain utopia that sounds a lot like a kibbutz designed by Ayn Rand. And if you don’t see that, well, you’re ngmi. The doubters of this “pathetic tech future,” scramble to dismiss the latest crypto craze as a “bust.” Most critiques at their heart are a version of this throwaway line in an otherwise quite interesting Time profile of Ethereum creator Vitalik Buterin:
“Ethereum has made a handful of white men unfathomably rich, pumped pollutants into the air, and emerged as a vehicle for tax evasion, money laundering, and mind-boggling scams.”
Well, when you put it that way…
I’m too much of a realist for these extremes. I believe crypto is, in some ways, inevitable based on the sheer amount of capital – financial, people and cultural – going into it. Kevin Roose, who has taken a moderate approach to the Crypto Holy Wars, has a very good web3 primer for those with open minds. The trough of disillusionment is a critical part of any adoption cycle.
I’m most interested in web3 through the lens of publishing models. For that, Jarrod Dicker is my web3 shaman, since as a longtime publishing executive at places like The Huffington Post and The Washington Post, he’s got a foot in the Old World of Web 1 and Web 2.0 and now one firmly in the New World as a partner at investment firm TCG.
What I like about Jarrod is, despite his affinity for Phish and cryptic tweets, he’s a realist. He knows how early it is for this set of technologies having tangible impact.
Some key takeaways from my conversation with Jarrod:
NFTs matter. Look beyond the speculative frenzy over ape drawings. The importance of NFTs are when they’re tied to access and community. In media, imagine moving people from a passive audience to active participants to owners.
Web3 needs better marketing. Let’s face it, crypto boosters do themselves no favors by coming across as Crazy Eddie on bath salts. The challenge of movi
How Puck is putting creators at the center of a media brand
Every cycle of unbundling is followed by another period of rebundling. Media is no different – just look at the streaming market. In publishing, the shift of power from institutional brands to individual brands has unfolded over the past few years, and now a period of rebundling will begin.
Puck is a seven-month-old media brand built with the institutional-individual brand continuum firmly in mind. The publication has recruited several well-known journalists to focus on American power centers in finance, tech, media, politics and entertainment.
“Puck is a media brand with creators at the center,” said Liz Gough, a former Condé Nast exec who is COO of Puck. “We are focused on telling the inside story from some of the most important parts of America: Wall Street, Silicon Valley, Washington DC and Hollywood.”
What I’ve liked about Puck is how it’s not recreating the same old publishing model but instead bringing on its contributors – people like Dylan Byers, Julia Ioffe, Teddy Schleifer, Matt Belloni – as partners, giving them a middle ground that has the benefits of both the institutional approach and personal brand approach. (I have a deal with Puck as a contributor to license some of my writing for The Rebooting. I don’t have any financial interest in the company beyond that.)
“We saw two ends of the spectrum,” Liz said. “We saw the individual brands of the world and at the other end legacy or institutional brands that a lot of the founding team at Puck came from and have their own amazing benefits but also challenges. We thought the media brand of the future is taking the best of both of those worlds.”
In this week’s episode of The Rebooting Show, Liz and I discuss the idea of journalists as influencers, why subscriptions and ads work well together and power centers as an editorial lens.
Journalists as influencers
The notion of “personal brands” in journalism is, to put it mildly, a bit of a lightning rod, but Puck doesn’t shy from the concept. After all, journalists have long built reputations for their work – and looked to make money from those reputations.
“Journalists are the one of the most original influencers in American society when you think about it. They were the last untapped group in the direct-to-consumer revolution. We started thinking about how to build a business that places journalists at the center of the revenue model rather than as a cost center. But at the same time, we know brand still matters.”
No one size-fits-all-approach
I’m not a big fan of false dichotomies. There’s no one way to do anything, or one model for publishing. What I think the unbundling of publishing has done – and I give Substack a lot of credit for opening new options – is to give writers more choices about how they work. The idea that many people don’t all have the same needs and motivations doesn’t strike me as crazy – new option
The Logic’s David Skok on being a journalist founder
Journalists in their 40s are under no illusions to the need for sustainable business models in news publishing. Being suddenly laid off is a rite of passage.
“Those of us who started in journalism in the late ‘90s, early 2000s, very early on we were awakened to the challenges of the business models,” said David Skok, founder and CEO of The Logic, a four-year-old publisher focused on the growth of the knowledge economy in Canada. “We didn’t have the church and state separation as much as others did in terms of understanding the news industry is as much about product and business strategy as it is your editorial. I’ve always said you could have the best lede or nut graf in the world, but if it didn’t load on your phone in .01 seconds, it was invisible to the reader.”
Founded in 2018 and now with 20 employees, The Logic is an independent publication focused on the knowledge economy in Canada as it transitions away from an economy largely dependent on sectors like mining and real estate. David describes The Logic as “a combination of the business model/product of The Information with the editorial focus of The Financial Times.”
On this episode of The Rebooting Show, David and I discussed why The Logic doesn’t consider itself a tech publication, differentiating through original reporting and why a subscriptions-based business model isn’t subscriptions-only.
Starting from scratch
David is a veteran journalist, with roles at the Boston Globe and The Toronto Star. He started The Logic almost four years ago after recognizing the challenges legacy news organizations face in changing their business models provides an opportunity for new entrants with the right focus.
“I had been a disruptor from within [large news organizations] and seen a lot of the same mistakes being committed and a lot of the same barriers to innovation. I wasn’t seeing a lot of success in large organizations, not because the effort wasn’t there, but because they’re large organizations and they’re slower moving. There was an opportunity, particularly in the Canadian market, which hadn’t had a lot of innovation in a while, to start something new.”
Going beyond tech
Technology long moved from a vertical coverage area to a horizontal. There is a tech angle to just about every news story. For The Logic, that means going beyond technology to zero in on the big story of the Canadian economy shifting its focus to industries like crypto and electric vehicles.
“You can't cover tech anymore without covering the future of everything. Early on, we branded ourselves as a technology publication because it was a way for people to digest what we were doing, but it was almost a Trojan horse. We’re really about the future of the entire economy, not just tech. What we try to do is cover it through a lens of innovation and forward-thinking.”
Being unique and meaningful are the ways to stand out in crowded markets. For The Logic, that means focusing on in-depth, reported stories as opposed to chasing SEO traffic by rushing up an explainer of “What is SWIFT?”
“[The Information’s CEO] Jessica Lessin has talked a lot about this: How do you be 10x better than your competition? You have to make sure you stand out. Do we have unique access to someone or something? Are we telling you something original, breaking original reporting you can’t get anywhere else? All our work is based on original reporting so that we can define the agenda as opposed to fo
Howard Mittman on 'mission-driven' publishing
Like just about everyone, I’m both horrified by the Russian invasion of Ukraine and in awe of the resistance of the Ukrainian people. Ukraine is an inspiration to the rest of the world. In places like the United States, we fail to appreciate the staggering advantages we have just by dint of where and when we were born. In September, I visited Ukraine to speak at a conference to build sustainable, independent journalism in the region. This is a hard task in a country with complicated politics where publications are often controlled by oligarchs and political parties, and the economy is far smaller. The Ukrainian people I met were all first rate and incredibly generous. They’re also brave. Consider helping by giving to one of these vetted programs, as well as a fundraising for the Kyiv Independent, an independent English-language publication, and this one for other independent media in Ukraine.
A couple years ago, then-Bleacher Report CEO Howard Mittman coined a neat phrase for the end of an era of lightweight content produced for algorithms: Need vs Feed. In the next era of digital publishing, you want to be on the Need side.
“When I think about publishing, I think about purpose-driven versus mission,” he said on this week’s episode of The Rebooting Show. “Purpose-driven publishing is about ad dollars and collecting affiliate revenue. It's about filling a gap that consumers have based off of a Google search or social media. Mission-driven is where I’m interested in now. You see that in areas like the environment and in news.”
Howard spent a dozen years at Conde Nast, occupying top business roles for titles like GQ and Wired. I’ve always known him to be thoughtful about where the media business is going, so we had a discussion about the dangers of going overboard on subscriptions, why now just might be the time for new entrants to address local news and why the betting gold rush for sports publishers might soon taper off.
Hope for local news
If there’s a sector of publishing that could use a comeback, it’s local news. The industry has been decimated over the past two decades, with big-city newspapers shrunken and news desserts dotting the map. But new entrants are emerging.
“We live in a world where all politics are still local, but all news coverage is national. I hope there's a compromise. I suspect we're getting closer to finding it. I don't know that local journalism is always going to be defined in its most traditional form. It may not simply be about local news and information. And maybe local journalism is decreasing the proximity between the content creator and the reader. If you look at the podcast system, how many have evolved into live events? That reduces the friction between the creator and the user. Those direct connections people will pay for in pretty intense ways – if you have the right talent, if you have the right topic matter, the right sort of credibility.”
The case for ads
The pendulum in the publishing business has swung far away from ads and firmly in t
How Blockworks got to $20m in revenue in 5 years
Over just five years, crypto has exploded from a curiosity to a cultural touchstone, with millions of boosters, Super Bowl commercials and billions of investment in the belief that a new financial system, built for the digital age, is being created.
And along the way crypto has become highly divisive. Its most ardent supporters are hardly known for their understatement, giving crypto the whiffs of both libertarianism run amok and a speculative frenzy that’s given cover to all manner of grifters. The Gold Rush mentality isn’t a bad thing, according to Jason Yanowitz, co-founder of Blockworks, a crypto-focused media company that expects to top $20 million in its fifth year.
“Bubbles are good,” he said on this week’s episode of The Rebooting Show. “They bring in capital, that’s how innovative technologies get built. Railroads went through a massive mania from 1840 to 1870 with all these bubbles. But obviously railroads got built. Bubbles just bring talent and capital.”
Jason and I discussed how four-year-old Blockworks has built a $20 million business by positioning itself as the go-to resource for financial institutions to understand the fast-moving world of blockchains and crypto currencies.
Believing in crypto’s inevitability
As newcomers to crypto in 2017, Jason and co-founder Mike Ippolito saw a nascent industry stuck in boom and bust cycles and with its scruffy edges. But they believed one key thing: crypto would eventually become a very large institutional asset class.
“The white space that we saw was around information in the industry. In 2017 there were basically two media sites, CoinDesk and Cointelegraph. You had one or two podcasts, and then a bunch of information on things like Twitter and Reddit. We would go to these events, and they were clearly run by a bunch of scammers. And then you'd look online and it seems like a bunch of people pumping different coins. But 1% of this feels real. We've done so much wrong over the last four years, but the one thing that we got right is believing that crypto would eventually become an institutional asset class and that we would need better information, insights, data analysis, news, research, et cetera, for the massive cohort of capital markets and people coming into crypto.”
Building from events
Blockworks started out in events, hosting its first one in February 2018. Went into the business full-time in May. Blockworks only then branched into content with a podcast network, including popular crypto podcaster Anthony Pompliano. It was only in January 2021 that Blockworks launched its news site. The advantages of this approach: Blockworks was generating revenue from the start.
“We've never had to raise outside venture funding because we started with conferences. We ended up building a community of some of the most valuable people in the world: money managers, hedge fund managers, portfolio managers at endowments, family offices. And that turned out to be a really valuable audience for this institutional bucket of crypto companies that ended up getting built in 2017 to 2010 – Fireblocks, BlockFi, Gemini, Coinbase, all these institutional crypto brands –
How Famous Birthdays built a data business off celebrity searches
When it comes to business models, software models beat publishing ones. Recurring revenue scales more quickly and at far better margins.
For a decade, Famous Birthdays has chronicled the rise of digital culture through its platform for finding out more information about the digital stars from TikTok and YouTube, as well as more traditional pop stars. Famous Birthdays has relied heavily on its internal search data as the “North Star” of its business. The company noticed Charli D’Amelio rising in popularity in 2019 and recorded a video interview with her before the TikTok star exploded in popularity. That formed the basis of the Famous Birthdays Pro product that offers proprietary data on who is rising and falling in popularity. Clients include platforms, influencer agencies and services, and talent representation firms.
“We add more clients and it just grows,” said Evan Britton, founder of Famous Birthdays. “If you pivot to video, you have to create that content and you get some margin on top of it. Ad-based businesses aren't as exciting, We could have charged our users a few bucks a month and given them extra functionality. But we went with the enterprise model, which is good because we don't have to gate anything with our users.”
Evan and I spoke about the opportunity he saw that led to Famous Birthdays, the opportunity for a data business and why he went all-in on programmatic advertising.
Finding opportunity in the shift to mobile
Technology shifts create opportunities. Back in 2012, the mobile phone was just starting to usurp the role of desktop in how people found and consumed information. Evan noticed that sites like Wikipedia were comprehensive, but not made for a mobile experience, particularly the small screen size of those early smartphones.
“Birthdays are always often the first thing people want to know about a celebrity, but there's other information they want to know. We were a mobile-friendly Wikipedia/IMDB. I'm more about user experience. The user experience on mobile for Wikipedia was not good. You don't want a book report on mobile. You want to get right to it. I saw that as an opportunity as an entrepreneur.”
New class of celebrities
As digital media has grown, it has created its own set of celebrities, grouped together under the broad term of “creators.” These can range from YouTube stars to Instagram and TikTok performers. What Famous Birthdays saw early on, back to the heyday of short video service Vine, was fans often have greater attachment to these digital stars.
“We would have a Vine star with a million followers sending us their headshot and their bio. And then at the same time we had these movie actors that wouldn't respond to us that had 5,000 followers. We saw very early that there was a gap between where culture was, but where the industry was set up. Traditional celebrities, you are a fan of them, but with social stars, you are really a fan. It's different when you see someone in a movie acting as someone else versus watching them brush their teeth every morning. Social just had a deeper level of fandom and we always saw that in our rankings.”
Why platforms got creator religion
Just about every major tech platform has their own twist on creators. Most have lau
Digital advertising's data reset
The entire tech industry is going through a broad reckoning over the collection, storage and use of consumer data. Government regulations, Apple’s new data policies, the demise of the third-party cookie and other market pressures are changing how a large chunk of advertising works. Look no further than Facebook’s historic stock price meltdown after disappointing results it blamed, in part, to new obstacles to targeting and measuring ads.
“We get a reset that gives the industry an opportunity to rethink a lot of things,” said Jake Abraham, chief commercial officer of Audigent, a data platform that works with publishers to better understand their audiences and turn that understanding into achieving business goals. “While it’s messy in the middle, ultimately we come out with a [situation where] the publisher is the source of truth, more transparency, better privacy and more tools to actually do what both advertisers and publishers want.”
Below are highlights of the conversation Jake and I had about how publishers need to think of their audience data as an asset class, the false dichotomy between contextual advertising and addressable advertising, and how Facebook gets small businesses hooked.
The negative impact of rampant data collection
The only people in the world who use the term “personalized advertising” are those who work in ad tech. For the rest of humanity, this is ad targeting or, increasingly, “surveillance advertising.” The backlash against the use of data in advertising is somewhat curious since there are seemingly far more worrying data trends, particularly how governments are using data sets, but likely ties back to the chaotic, complicated way digital advertising works in the hopes of getting the right ad in front of the right person.
“Publishers are victims often. Their margins are squeezed harder than ever before. As the technology evolves, there's more and more middlemen. It's very hard in this ecosystem to understand the technology, and understand how those middlemen might be using the data and taking a vig on the transaction. Some of the [intermediaries] are super important. But there are plenty of others that, in a pretty unregulated industry, have found a way to insert themselves and arbitrage. And while that may not be illegal, it certainly doesn't provide a lot of value.”
Not all middlemen are bad
If digital advertising has an original sin, it’s likely the ability to separate the audience impression from the media. This was a nifty tri
Jake Sherman on Punchbowl’s $10m first year
Washington D.C. has long been a company town, only the company in question is the sprawling federal government, its various apparatuses – and those who influence them. It’s no surprise then that the once-sleepy media business around the government has become one of the most vibrant areas of growth in digital publishing. Consider:
Axel Springer ponied up $1 billion to acquire Politico last August.
Axios has pulled off one of the most successful early runs for a media company in its first five years, with a valuation of $430 million.
The Hill was bought by Nexstar Media Group for $131 million last August.
Grid News recently raised $10 million in venture funding.
Add in Punchbowl, a year-old media startup founded by Politico veterans. Jake Sherman, a co-founder of Punchbowl, wrote Politico's flagship newsletter, Playbook, along with fellow co-founder Anna Palmer. (John Bresnahan, the former Congressional bureau chief for Politico, is the third co-founder.)
While some digital media startups go to great pains to hang their differentiation on a new format or approach or business model, Punchbowl’’s model is fairly straightforward. It is going to out-report its competition and be a must-read for those who need to keep up with the ebb and flow of legislation on Capitol Hill. While many outlets wander to focus on the White House, Punchbowl is squarely focused on the legislative branch.
“We know we know the audience, we know what they're interested in, we understand the business model, we have ambitions,” said Sherman, speaking from his office at the Capitol during a week when the legislature was in recess. “We felt like we had the playbook, so to speak.”
So far, so good. Punchbowl reached $10 million in revenue in its first year, with $1 million coming from subscriptions and the rest from sponsorships bought by trade groups and companies looking to get their public affairs messaging in front of those making and influencing policy. That’s with a team of 10.
Jake and I discussed how Punchbowl differentiates by using the Capitol as its lens, how being entrenched alongside the audience helped, and why ads and subscriptions can work well together. (Answers have been edited and condensed for clarity.)
Focusing on the Capitol
As Trump and Biden have learned, the presidency’s powers are limited when it comes to passing legislation that reflects the president’s priorities. For Punchbowl, named after the Secret Service code name for the Capitol, the focus is on the legislative process, in particular the priorities of the leadership of both parties.
The Grid’s “fuller-picture” approach to news
The roaring 20s of publishing has begun with several new brands launching, each with their own twist on dealing with the challenges of audience growth and sustainable business models. What’s notable is most publications are not promising to build massive audiences. Instead, most are focused on high-value audiences that lend themselves to high-priced ads and subscriptions.
Grid is one of this crop of newcomers. Laura McGann, a Vox.com editorial director who is running Grid’s editorial side, saw an opportunity to build a news brand premised on a new newsroom model that seeks to tell a more complete picture of news stories through a collaborative approach that taps into different areas of expertise. The end result: a “fuller picture” of the news.
“We're trying to create our brand around the idea that we can create additive value where one plus one equals four by putting really smart people together.,” said Brad Bosserman, Grid’s CRO who joined the company following seven years leading brand partnerships at Politico.
Brad and I discussed the current boom of publishing startups, journalism-led innovation and building a sustainable business model around targeting influential readers.
The new cycle of publishing innovation
My view is we’re at the start of a multiyear cycle of innovation in publishing, as legacy publishers look to consolidation and efficiency while a new class of upstarts spring up to move faster to capture new opportunities that inevitably spring up with the macro environment changes. Brad points out that media is a reactive business.
“Media companies tend to be born in generations. When you look at that 2005-2007 period, you had all sorts of companies that were born in that same window. And now 15 years later, you're seeing another one of those generations where a new breed of companies is being born. A lot of times media companies are downstream of larger changes in the culture, consumer behaviors, business models and technology platforms. As those things change, media companies react to those [changes]..”
The pivot to direct connections
During the last period of publishing innovation, platforms were at the heart of most companies’ distribution plans, at a minimum. The idea was simple: Facebook was connecting the world, might as well hitch a ride to grow alongside a once-in-a-generation company that’s adding millions of users a day. Easier to swim with the tide than against it. These days, you’ll rarely hear mention of platforms in the pitches for new publishers. You’re more likely to hear about how important email newsletters are.
“There's a lot more skepticism around the platforms [and] the idea that you could get a lot of audience quickly from Facebook. There's a big push toward owning audiences in a much more authentic way. That’s at the core of everything that's being launched: the idea is that you really need to own your audience. That's because of all the experiences that folks have had over the last 10-15 years. [Platforms] did allow for a lot of companies to acquire large audiences at various points, but they found that they were renting them. That’s behind a lot of the push toward subscription models and the push to first-party [data].”
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New entrants to a market typically lead with a product innovation. In the news publishing bu
How Protocol applies the Politico model to tech
Publishers often struggle to know which partners bring incremental value. And the complexity of programmatic advertising has only exacerbated the problem. Audigent has been focused on demand generation for publishers’ premium data since day one, delivering customized solutions that drive additional direct and indirect revenue. Audigent’s platform is simple to integrate and focuses on a combination of technology, service and unique demand, providing a proven solution for what pubs need most today and into the cookieless future. White-glove service, superior technology and demand generation are three primary reasons why some of publishing’s most-recognizable and innovative brands rely on Audigent.
Many publishers want to run the Politico playbook. What Politico managed to do is take politics and cover it like ESPN covers sports, attracting big enough audiences for a robust ad business, while focusing on narrower slices of must-have information on legislative minutiae to power a high-priced subscriptions business. It only makes sense that Politico itself would look to do the same, as it has with the two-year-old Protocol, which is applying the Politico playbook to the sprawling world of tech.
Tech has long since matured as a vertical topic, rooted in Silicon Valley, to a horizontal story of power and influence that spans industries, governments and societies. It also happens to have both deep pocketed investors and advertisers..
“The very core of Protocol was an extension of that same thesis, which is, can we use this similar influencer-focused, unbiased model that made Politico successful and made Politico Europe successful?” said Bennett Richardson, a Politico veteran and the recently named president of Protocol. “Could we take that out of politics entirely and bring it to a different power center in a different industry? Unsurprisingly, given everything that media and every other industry are going through, tech was the obvious first place to bring that thesis to.”
Protocol is currently 55 employees, with eight newsletters that collectively have 250,000 subscriptions. The site gets about 1.5 million visitors a month, Bennett said, adding only that Protocol’s revenue was up 150%.
Bennett and I discussed the Politico playbook, balancing consumer and specialized publishing, and why some ad categories like public affairs are booming. Below are some highlights of the conversation.
The power of influence
For all the downsides of the news business, there will always be a place for publications that can break through and serve the needs of elite powerbrokers. These audiences are simply too valuable. There’s a reason Axel Springer bought Politico for $1 billion, Axios has grown so quickly and upstarts like Punchbowl are making a splash. That’s also why the still-unnamed global news venture from Justin Smith and Ben Smith will target elites, promising “unbiased journalism,” and why upstart Grid secured $
Troy Young on publishing's pivot to individuals
I’m continuing my look-ahead series of podcast episodes to kick off 2022. Last week, Sara Fischer, media reporter for Axios, laid out her big themes for the year. This week, I spoke to Troy Young, the former president of Hearst Magazines, who over the years I’ve found to be very thoughtful about how the media business is changing. Reminder: If you like the podcast, please share it with others who might also find it valuable – and leave a rating and review on Apple Podcasts if you’re in the blue bubble brigade. Big thanks to mpm318 for this nice review.
If you’re making bets for a Word of the Year in digital media in 2022, identity is a good candidate. The nature of digital advertising is changing as the industry transitions away from the third-party cookie as a key audience identifier. Identity, both on the page and across the ecosystem, is an evolving and complex component to publisher monetization. Audigent’s Hadron ID serves as a cookieless “container” solution, delivering cookieless solutions at scale while being fully interoperable with other ID systems. It is simple to deploy and instantly enables end-to-end cookieless programmatic buying while delivering addressablity. Audigent is transforming how clean first-party data powers the programmatic landscape by putting the control back in the hands of publishers and advertisers.
Troy Young has been through the various interactions of digital media going back to the start. During the dot-com boom, he was an executive at early web marketing agency Organic. During Web 2.0, he decamped for video ad network VideoEgg, which turned into Say Media, a hybrid tech platform and vertical publisher, eventually landing at Hearst Magazines, where he was president. Now, he qualifies as officially Web3 curious, if not ready to start his day with “gm” tweet and regularly rely on riddles to explain what’s seemingly inexplicable in crypto.
“It's an incredible time to be a curious person,” he said on The Rebooting Show. “There's so much to learn and there's so many people who are not part of what is a sort of classic media ecosystem that are writing about things that there's really an unending source of inspiration.”
What stood out to me from the conversation:
The need for media companies to use Web3 to rethink their relationships with their audience as well as within their organizations
The promise of Web3 – and yes, we’re mostly talking promise vs reality at this point – is a fairer deal for all involved rather than the benefits and power going to a select few
The opportunities for new brands that are part of communities
Finally, I’m often struck by how few people deeply involved in the development of digital media are particularly pleased with many aspects of how it has turned out.
“Let’s face it, monetization on the open web never really worked that well outside of the datasets and buying interfaces that allowed Facebook and Google to sweep up the long tail of advertisers and take over huge amounts of that ecosystem, including everything f
Axios' Sara Fischer on the year ahead in digital media
Hope everyone’s 2022 is off to a good start. I’m kicking off a new mini-season of episodes this month that will focus on what to expect this year in digital media. To start, I spoke with Axios media reporter Sara Fischer, who has chronicled the industry for the past five years with the Axios Media Trends weekly newsletter. As a reminder, please leave a rating and review of The Rebooting Show on Apple Podcasts.
The key to sustainable media business models is having a tight relationship with your audience. That means understanding them. Audigent helps leading publishers like Penske Media and Fandom to unlock the power of their audiences with an industry-leading data activation, curation and identity platform that’s supported with best-in-class tools and teams that boost business outcomes. Audigent was founded on the belief that first-party audience data is a critical asset, today and into the cookieless future. The Audigent Platform is a flexible, turnkey solution that improves business for publishers of all sizes.
I’ve always thought of the opacity of the digital media system as more of a feature than a bug. As a reporter that means sorting out what success looks like in an industry where smoke and mirrors have long been deployed as a strategy.
“The industry is going through sort of a reckoning around measuring success,” said Sara Fischer. “It's hard to quantify progress in the industry, whether it's television or digital. We just don't seem to have a ubiquitous understanding of how to measure success.”
Here’s what Sara expects to be major storylines in digital media in 2022.
Expect more consolidation, only smaller deals
2022 presented a unique M&A market for the digital media industry. With a booming stock market and ample opportunities for financing, the focus was on big corporate moves like BuzzFeed’s SPAC and Vox Media’s purchase of Group Nine. But the year to come will likely be less splashy as big digital media players do smaller deals.
“There's going to be less talk about consolidation happening through SPACs. It's going to be more traditional and that's just because we've seen with BuzzFeed that there are some challenges to doing it that way. The SPAC market is cooled. What you're going to see more consolidation, but it's going to be private. So similar to what you saw with Vox Media, merging with Group Nine. You're also going to see more low hanging fruit continued to get scooped up. We're going to see a lot more of the Some Spider Studios getting acquired by Bustle.”
The pivot from general news
Trump was very good to news publishers. Top news publishers racked up record audience gains and the obsessive attention Trump commanded from those who support and oppose him gave a boost to these publishers’ subscription programs. Of course, what goes up often comes down. For Sara, that means expecting news publishers to follow the lead of The New York Times and diversify their products into lifestyle categories to expand their customer bases beyond political obsessives as people increasingly tune out a “boring” Biden presidency.
“Given the absence of a very volatile news
Rishad Tobaccowala on navigating a changed world
Happy holidays. I’m wrapping up the year with a final podcast and then, on Wednesday, I’ll send out the second annual Rebooting Awards. In the meantime, my final podcast of the year is with Rishad Tobaccowala, a longtime advertising executive who is now also publishing his own newsletter, The Future Does Not Fit In The Containers Of The Past. If you enjoy The Rebooting Show, please leave a rating and review on Apple Podcasts – or share it with others. But first, a message from this week’s sponsor, Mediaocean.
Next week many are heading to Vegas for CES, the annual confab of the tech, media and advertising worlds. I know some of you will be skipping the action this year, but that doesn’t mean you have to miss out. Mediaocean has set up a livestream of its programming of the Mediaocean Retreat so you can still enjoy the thought leadership the Retreat will feature from an array of top executives, including Twitter chief customer officer Sarah Personette, Cadillac CMO Melissa Grady and S4 Capital CEO Martin Sorrell, not to mention my podcast guest this week, Rishad Tobaccowala. The programming will run Jan. 5 and Jan. 6 from 12pmPST to 4pmPST. Check out the agenda and register now. Be sure to tick the box for virtual and you’ll receive access links. Also, the recordings will be available on demand following the event.
Rishad Tobaccowala has long been known in the advertising industry for his sage view of the need to embrace change – “Change sucks. Irrelevance worse.” – often delivered through pithy phrases and neatly numbered lists of points. For the final episode of 2021, I wanted to speak to Rishad to take stock of where we are and where we’re going as we come up on two years into the pandemic era.
For Rishad, the pandemic is a marker of a profound shift, part of what he calls the Great Reinvention. The pandemic is not a singular crisis like previous shocks such as the Financial Crisis, but is instead a polycrisis affecting health, the economy and society. That is leading many to reassess their approaches to life – just see the rise of the so-called anti-work movement. As he put it at the start of the crisis:
“We had not just a financial crisis, not just a social crisis, not just a health crisis but all three, occurring not just to some people but to all people, not just for a short period of time. If you take the entire world and put them through a financial, social and health crisis for two years and expect things to be the same, you should not be in business and should resign immediately.”
Below are highlights from our conversation.
The unbundling of media
One impact of the rise of Substack and other newsletter platforms is they have given a convenient outlet for people to share their expertise in their fields. Rishad is one of them, starting a Substack back in August 2020 to “remain relevant and keep learning new things.” It became much more, serving as the basis for a new
The Slowdown's less frenetic approach to media
What a strange end to the year, with Omicron the march, inflation jitters and more unknowns than seemingly ever before. But there’s not the same amount of panic and anxiety as the spring 2020 — positive Covid tests seem to be the new social media flex. Nearly two years into this pandemic era, we’ve grown resilient, whether we dwell on it or not. We have so many more tools and knowledge now than when this all started, and we are also just better equipped ourselves to deal with the ups and downs and uncertainties.
The last two episodes of The Rebooting Show this year are tied to this theme, considering what we have figured out since the pandemic began. This week, I spoke to Spencer Bailey and Andrew Zuckerman, co-founders of The Slowdown, a media company focused on making sense of the world around us. When the pandemic hit, they started At a Distance, a podcast in which they shared conversations with an array of influential people about how we should rethink the world. The resulting interviews became fodder for a new book. Thanks to Mediaocean, sponsor of these year-end episodes.
Covid was momentous from the start, even if we just called it by the generic coronavirus. Once cities started shutting down, it was clear this wasn’t a passing blip or even a localized shock. It wasn’t 9/11 or the Financial Crisis. The scale was unimaginable. The entire world on pause. For those lucky enough to be forced to isolate — health care and essential workers didn’t have this luxury — the pandemic was a forced period of reflection. Many didn’t like what they saw.
For The Slowdown, just a year old as a company, its bet that the frenetic pace of the world was unsustainable turned out to be on the nose. Without being able to host its intimate conversations for Time Sensitive, The Slowdown’s conversation series with influential figures in business, arts and culture, Spencer and Andrew decided to move to Zoom with a new podcast, At a Distance, a podcast that gathered luminaries to use the forced isolation we all dealt with in order to think big thoughts about what comes next. At a Distance has compiled over 130 interviews so far.
“We realized everyone we were talking to was thinking in a really different way,” Andrew said. “Everyone had permission to think big picture, like this rupture had occurred and everyone was thinking about the world in a very different way and seeing opportunities and the issues were super coherent.”
Finding an intersection
My theory of media businesses is those from the creator or content side typically start with the need to make something they want into the world, then they fit it to the market opportunity and business model. People coming from the business side tend to work in reverse. Both can work. The Slowdown is the first type. “We wanted to make something that we wanted in the world that we couldn't get,” said Andrew. “So we figured we'd make it ourselves.”
“Our philosophical foundation was not in terms of scale, growth and the attention economy. We didn't see in the world a company that was truly looking at this vector of culture, nature and the future and where that comes together.”
A time capsule
From its start, t
How Silverblade Partners addresses the media's business's cashflow crunch
This week, I’m wrapping up the first mini-season of The Rebooting Show. This season was dedicated to modern B2B businesses. If you haven’t already, please check out the first four episodes of the season:
Adam White of Front Office Sports discussed the advantages of bootstrapping.
Julia Noran Johnston of Business of Home shared how she found an underserved niche in interior designers.
Angus Macaulay of Stat explained its Politico-like model for life sciences.
Industry Dive’s Sean Griffey spoke about the advantages of finding valuable but overlooked industry segments.
To cap off the season, this week’s episode is what I’m calling a Spotlight episode. This is an opportunity for the underwriter of the season to explain how they’re partnering with publishers to build sustainable media businesses. I treat these podcasts like all the others, and I only work with companies addressing real problems in the building of sustainable media businesses. This week’s Spotlight episode is a conversation with Bernard Urban, CEO of Silverblade Partners, a strategic finance partner to publishers agencies and ad tech firms. Thanks to Silverblade for being The Rebooting Show’s launch sponsor.
When I started to report on the media business, two things quickly became clear that I found odd: nobody could agree on how to measure audiences, and nobody paid each other on time. Publishers and agencies always complained bitterly about crazy payment terms. The way it usually works is those with the most leverage, ie the most money, force the smaller party to wait for long periods of time, up to 180 days.
Of course, the problem is your everyday costs as a business – salaries, rent, tech systems – are constant, creating a cashflow crunch. Stretched payment terms has created a velocity mismatch: The media business moves incredibly fast, only the financial system underpinning it slogs along like molasses. For many publishers, this means running a business with high fixed costs in terms of salaries, benefits, rent and more while the financing structure means publishers often wait a long time to get paid.
That’s why I was happy to partner with Silverblade Partners to sponsor the first season of The Rebooting Show. With access to over $1 billion in financing, Silverblade has the financial resources to solve liquidity challenges arising from outstanding accounts receivable for most media companies. Silverblade was founded by veterans of the media industry, with a deep understanding of the particular nuances of the business that your average bank simply does not have. Silverblade has built a cashflow solution that will finance accounts receivable and accounts payable on more flexible and favorable terms than an option like factoring from a bank.
Bernard and I spoke about some of the basics of trade finance, why traditional cashflow solutions like lines of credit or factoring are a mismatch for advertising media, and why finance should be a strategic function within media companies. Let me know any feedback you have on the episode: bmorrissey@g
Industry Dive’s path to $100m in revenue
This week’s episode of The Rebooting Show features a conversation I had with one of my favorite media success stories: Industry Dive, a collection of vertical industry sites. Sean and his team have grown Industry Dive into an example of a sturdy media business, on pace to break the $100 million in revenue mark next year with healthy margins. One request: If you listen to The Rebooting Show on Apple Podcasts, please leave a rating and review. Thanks to Alfred Westcott, who left a very nice review that ranked me “one of the best interviewers in media.”
Industry Dive is one of the most successful modern digital media businesses, even if it doesn’t get the attention of splashy consumer titles.
Sean Griffey, who founded Industry Dive in 2012 along with Ryan Willumson and Eli Dickenson, doesn’t mind flying under the radar compared to splashy consumer brands while Industry Dive focuses on industry verticals like retail, marketing, utilities and more.
“This is a better business. It’s great you’re targeting millennial fashion consumers, but I’m in the electric utilities space and that matters to everyone. The industries we write about touch every person. I leaned into the boring part because I know it’s important. You call it boring, I call it profitable.”
It helps that Sean has receipts.
2.5 million email subscriptions
$85 million in revenue this year, $100 million expected next year
EBITDA margins above 25%
Here are key takeaways from our conversation:
For all the talk of vision, the media business is an execution game. Industry Dive began in 2012 with a handful of publications and the idea that it would differentiate by providing a better user experience, focusing on the right industries, and sticking to what the team knew best.
“We thought there would be a chance to use the mobile experience to differentiate ourselves. We wanted to invest heavily in design. In business media it was pretty horrific. We wanted to invest in content. We thought niche media had abandoned that for leads over time.”
The power of niche
Scale and niche aren’t in opposition as often presented. But many digital media companies born around the time of Industry Dive took a different path. They focused more on general news audiences instead of specific areas. Industry Dive developed a formula for targeting industry sectors.
Industries changing rapidly due to tech and/or regulation
High capital spending
A buy and a sell side
Evidence of a vibrant market in the form of competing publications and trade shows
“There’s real value in 100,000 incredibly targeted, valuable people. In each of these markets, you could create a $10-20 million business, just marketing supported. But if you wanted a $500 million business, you had to do it a lot. For us it was how do you build a scaled niche business.”
Email is more than just a delivery mechanism
Email is the lifeblood of B2B media, allowing a direct connection to an audience – and a way to collect relevant information to understand the audience better. That’s why Industry Dive email subscribers can have a lifetime value of of hundreds of dollars.
“It’s a platform you own and nobody can take away. More importantly, it’s a push platform. There are very few things you can push to audiences vs pull, where they come to you. Email is also personally identifiable. You can start tyin
The Rebooting Show: Stat wants to be the Politico of health
For episode 3 of The Rebooting Show’s mini-season focused on modern B2B media, I spoke to Angus Macaulay, COO of Stat, the health-focused site that’s one of my favorite niche media brands. Please send me an email with any feedback. Also, please rate and review the podcast. Thanks to Niceguyappreviewer, who said The Rebooting Show is “such a valuable podcast for media entrepreneurs,” noting the “insightful, actionable and relevant information.” Thank you, Niceguyappreviewer.
Politico’s model has long been an aspiration of many niche media companies, even before Axel Springer shelled out $1 billion to buy it. The reason: Politico was able to pull off the “prosumer” model of providing in-depth, insider coverage of a niche (politics) that straddled the line of consumer impact but with the advantages of a B2B business model that typically affords an opportunity for high-priced subscriptions.
Stat, born out of the Boston Globe Media in 2015, wants to pull off the Politico model for life sciences. The site, which operates independently and has 70 people, had a breakout moment during the pandemic as the world’s attention by necessity turned to the issues that are squarely in Stat’s wheelhouse. Stat’s monthly traffic peaked at 23 million in March 2020 vs 4.7 million the prior month. The site’s revenue was up 40% in 2021 vs 2020, with subscription revenue up 24%.
“Before Covid, when we’d talk to people at conferences or to advertisers, it was either we know Stat and love it or I never heard of it,” said Angus Macaulay, Stat’s COO. “We were still a new brand. There was still an awareness brand. When Covid exploded, people in the healthcare industry were also trying to keep up on all the breakthroughs, and many in the ecosystem relied on us as a source. Our awareness in the healthcare ecosystem went through the roof.”
Here are five key takeaways from the conversation:
Find a local story with global impact
The idea for Stat came out of a dinner Boston Globe Media owner John Henry had with former Google CEO Eric Schmidt, who noted that while Boston didn’t have the tech scene that Silicon Valley has “you have the life sciences and the entire infrastructure with the academia in Boston as well.” While the Globe is mostly a local news company, the opportunity was to build a niche publication with global impact from the position of Boston’s outsized role in life sciences as home to over 1,000 biotech companies. “If you lived in Boston and Cambridge over the last 25 years, you can’t miss how life sciences has changed this area, it’s just exploded,” said Macaulay.
Use “stars” to establish credibility
Many news sites focus on keeping costs low, particularly early on. That often means hiring less experienced journalists who command lower salaries. With the backing of a larger media company, Stat was able to take a different path. Its founding executive editor was Rick Berke, a 27-year veteran of The New York Times, sending a signal of the ambitions Stat had, Macaulay said. “They didn’t find someone working at a niche B2B trade site. They wanted someone who understood high-end investigative journalism.” The site went on to hire several well-known reporters with deep experience in their fields, including
The Rebooting Episode 2
Thanks for the notes following the debut of The Rebooting Show. You can subscribe now on both Apple and Spotify. We’re working hard to improve the audio quality, and I’m going to make sure the episodes get shorter. I’m always interested to hear your feedback. My email is firstname.lastname@example.org. One request: If you like the podcast, please rate it and leave a review.
This week’s episode features Julia Noran Johnston, founder and president of the Business of Home, a vertical media company focused on the interior design industry.
I wanted to speak with Julia for a few reasons. I’m always interested in speaking to former journalists who are now running businesses, since I tend to think they build differently than those who come from the sales or operations side. The other reason is the category. B2B is often knocked as boring, but there are many areas that blend consumer elements. The home is one of those.
Julia’s advice for those building new media businesses: “Find your community. There has to be a community to support what you’re doing. Find a place that’s relatively untapped because that gives you the advantage and opportunity for success.”
Here are five key takeaways from the conversation:
Finding your niche
Building a business media brand means finding an underserved audience, ideally one with buying power. In the 2000s, Julia had shifted from journalism to a marketing role at Condé Nast’s Veranda magazine. What she noticed was that many requests for proposals listed interior designers as their target. “They were the volume buyers of the product,” she said. “In some cases, they were 100% of the buying base. I started to realize they were very valuable and what a premium audience that was, and at Veranda we weren’t isolating that audience.”
Community > audience
The most sustainable media brands focus on communities that share an interest and want to connect with each other. That’s why some of the most successful media brands -- Complex (streetwear), Barstool (bros who gamble), Hodinkee (watch collectors) -- are built around communities. Going to many interior design events in New York, Julia recognized that designers were a real community. “I was hanging out with designers, it was a real community that existed and there wasn’t a publication serving that community at all. I saw the opportunity for the community to have a hub.”
Be ready to pivot
The reality of most businesses is the path you plan to take isn’t usually the one you end up taking. For BoH, the initial business plan was built around assembling a database of designers with projects to match with product makers and bloggers covering the space. “It made a lot of sense on paper,” Julia said. But there was a problem: As BoH (then called Editor at Large) grew as a news source, the database business didn’t match since it was a PR play. Inevitably that would dent the credibility of the news content. In 2011, the company changed course. “We started to focus on that more because that’s what people wanted and where the demand was,” Julia said. “It’s much easier to meet demand than push something that people are resistant to.”
Growing a sales team
Getting sales right is critical to any sustainable business. BoH has relied heavily on in-bound leads for advertising, but is now building out its sales team and breaking into new categories. But that comes at a price: The need to add more infrastructure and processes expected by advertis
Introducing The Rebooting Show
After a year break from podcasting, I’ve finally started anew with The Rebooting Show, a weekly audio and video discussion that goes into the details of building sustainable media businesses with those building them. (The video is still in the works, and it will take a bit of time before the podcast feed is available on Apple and Spotify. Apologies.) The goal for the show is to focus on the mechanics and execution since I believe too much is generally made of “vision” in the media business. There aren’t a ton of secrets; those who succeed tend to simply excel at executing the details.
My goal is to get beyond the PR spin that’s, unfortunately, a feature of most business podcasts. I always knew a podcast would likely suck if multiple PR people showed up with the guest. It was nearly guaranteed if the guest then took out a sheet of talking points. You’d be surprised how many big media executives feel uncomfortable simply answering questions about what, in theory, they’re responsible for doing.
My plan is to break the podcast into mini-seasons of five episodes focused on a theme. This first season is focused on modern B2B media businesses, a topic near to my own experience. B2B has long been treated as something of a backwater, at best a stepping stone to consumer titles. That’s always sold B2B short. There are many terrible, old school B2B publishers and events companies, but there are a new crop of modern players emerging who are still focused on going deep on the ins and outs of their business areas but do so with a higher focus on in-depth reporting, slick packaging and diverse business models. In many ways, I think consumer media can learn more from B2B than vice versa since B2B has always focused on direct connections (often through email), communities and diverse business models that aren’t reliant on advertising.
That’s why I wanted to talk to Adam White, the CEO of FOS, home to Front Office Sports and Sports Section. Adam started Front Office Sports while still a student at the University of Miami in 2014. His cobbled-together Wix site was meant as a foot into a sports marketing career but grew to the point where Adam made the plunge into starting a business out of it.
I’ve always liked Front Office Sports and how Adam and his team have thoughtfully built the company and continued to execute. In our conversation, we discuss the origins of Front Office Sports, the white space they saw in the market, their approach to differentiation, and the decision to build off their B2B base with newsletters aimed at a wider consumer audience.
Some highlights from our discussion:
The importance of talking to your audience
FOS began as an informational interview project Adam did one summer during college. Putting them online seemed a no-brainer. There wasn’t a product roadmap or a business plan, but Adam listened to what he was being told. Many of the interviews veered toward career advice, giving him insight into needs in the market. “What they told me all the time was these young professionals that work in sports don’t get accolades.” That led to what in retrospect was FOS’s breakout moment: The Rising 25 awards in 2017. “It’s been the most impactful thing we’ve done,” he said.
Not having money is a gift
Investment firm Steins backed FOS in 2018, but Front Office Sports took a bootstrapped path. That turned out to be a blessing in disguise in retrospect. “If we had the money before we did the informational interviews, we wouldn’t be having this conversation. We would have never figured it out. They told us everything we should do.” That gave FOS a