Bryan Goldberg Would Like to Buy Your Dying Online Media Property

(Bloomberg Businessweek) -- One day in 2013, Rachel Sklar, the feminist writer and activist, saw something online that set her off. A 30-year-old media entrepreneur named Bryan Goldberg had written an article on the tech website PandoDaily, announcing that he’d founded an online publication for women called Bustle.com. “Isn’t it time for a women’s publication that puts world news and politics alongside beauty tips?” Goldberg asked.

The cluelessness was too much for Sklar and many others on social media who branded Goldberg a mansplainer. “Congratulations for being the first person to realize that women are interested in foreign news AND makeup tips!” Sklar wrote in the article’s comments section.

Goldberg took the ridicule as a sort of challenge. He first contacted Sklar through a friend, and, after she declined a meeting, paid $200 for a package of consulting sessions. (Sklar was offering the sessions to raise money for the website Feministing.) “All right, well played,” she recalls thinking.

From there, Goldberg did everything he could to win her over. He attended a pro-choice event and recited a Beyoncé lyric during a bar’s open mic night. (“Feminist: A person who believes in the social, political, and economic equality of the sexes.”) Sklar posted a video on Instagram of Goldberg’s open mic performance and visited Bustle’s offices. She noted that Goldberg employed lots of women in leadership roles. Goldberg then paid her in equity to be an adviser to his company, later renamed Bustle Digital Group, which was valued two years ago at about $200 million. Sklar is no longer a critic; she’s a character witness. “If people are looking at Bryan as a caricature from the Bustle launch, then they don’t know him,” says Sklar, who is co-founder of TheLi.st, a network for professional women. “He’s had a journey.”

Six years into that journey, the founder of Bustle is still co-opting rivals and critics, but now he’s doing so in bulk. Since 2017, Goldberg, now 35, has amassed a portfolio of digital media companies, including Elite Daily and Mic—both of which had fallen on hard times before Goldberg bought them. At one point he tried to buy a majority stake in Rolling Stone magazine, which was similarly hard up, but lost out to Penske Media.

Last year, Goldberg bought Gawker.com out of bankruptcy for $1.4 million. Before it succumbed to a barrage of litigation headlined by former professional wrestler Hulk Hogan and secretly funded by billionaire Peter Thiel, Gawker was renowned for mercilessly filleting its subjects, including the new boss himself. Gawker had once referred to Bleacher Report, which Goldberg co-founded and sold to Time Warner Inc. for about $200 million in 2012, as “an enormously popular sports site written by and for idiots.” Another post by Gawker’s sister website, Valleywag, described Goldberg as an “asinine media mastermind” and an “asshole.”

These articles are still available in the archives of the old Gawker, which Goldberg now owns and is preparing to reintroduce in the fall. During a recent interview at Bustle’s headquarters, Goldberg, who has been meeting with former Gawker employees and hopes to hire a few of them, insists that Gawker’s business prospects can be resuscitated, as can its swagger. “As far as I’m concerned, it’s a simple solution,” he says. “Launch something fantastic so even the critics have to admit it’s really good.”

The critics are waiting. “Gawker exists to make fun of some boob who accidentally got rich and is buying up a bunch of publications he doesn’t understand,” says Tom Scocca, a former Gawker writer who now edits the blog Hmm Daily. “Gawker had a brain. It had a sensibility. It had taste. I don’t know what he thinks he’s doing in the absence of those things.”

Goldberg was inspired to become a media entrepreneur by his cousin, Jake Lodwick, who co-founded the online video site Vimeo and was also a frequent target of Gawker’s mockery. Lodwick put seed money into Bustle and taught Goldberg lessons that guided him through his early experiments with online publishing. Among the most important lessons, according to Goldberg: “You must learn to ignore shame.”

In 2007, Goldberg and three childhood friends started Bleacher Report with the goal of replacing local newspaper sports pages. The site churned out articles and slideshows based on what people were searching for on Google. It initially didn’t pay its writers, whose qualifications amounted mostly to being sports fans. At the beginning, Goldberg managed the engineering team, despite never having written a line of code.

But Bleacher Report succeeded, partly because of its unusual citizen journalism model and partly because of the sheer volume of content its contributors pumped out. By 2012 it was one of America’s most visited sports websites behind giants like ESPN.com and Yahoo! Sports. Although Bleacher Report was only profitable for a short time, Time Warner’s Turner division, which owns the cable channels TNT and TBS, was persuaded to buy it. To celebrate, Goldberg and his co-founders flew their 160 employees to Las Vegas to party.

After the sale, Goldberg saw an opportunity to apply the Bleacher Report model to women’s magazines. “We’re laser-focused on building for the next decade what Condé Nast, Hearst, and Meredith had in the 1980s and 1990s during the glory years,” he says. He often says his company will replace traditional publishers, a strategy that one rival media executive suspects is a way to get their attention so they’ll buy his company.

On a recent morning at Bustle’s Manhattan office, Goldberg wore a tight, short-sleeve Lacoste polo that showed off his biceps. (He hits the gym regularly to relieve stress and has posted videos of himself on social media lifting weights.) On the wall of his office, he had hung framed photos of women he admires: Madonna, Margaret Thatcher, Marie Curie, and Shirley Chisholm.

Goldberg once boasted that he speaks “fluent nerd,” “fluent hipster,” and “fluent d-bag.” Bustle speaks none of these, adopting an earnest tone. On any given day, the site features reality TV gossip, stories on body positivity, celebrity pregnancy news, and interviews with serious feminist figures, such as the president of Planned Parenthood. Recent headlines have included “How to Help Women in Alabama if You’re Enraged by the Abortion Ban” and “7 ‘Game of Thrones’ Themed Sex Toys, Because Winter’s Not the Only Thing Coming.”

Goldberg keeps his distance from the editorial operations and focuses on the business side. His playbook is to buy struggling websites for cheap, cut their costs by using Bustle’s own engineers, offices, and ad sales team, and not raise large sums of money that would force his company to grow too quickly. (It has raised a total of $80 million from investors.) In 2016, Bustle generated about $30 million in sales. This year, Goldberg projects the company will bring in $100 million—though some of that growth can be attributed to acquisitions. Bustle should turn “a small profit” this year, Goldberg predicts.

But running a digital media company has never been more uncertain, and it remains to be seen whether Goldberg’s formula will work. About 90% of Bustle’s revenue comes from advertising, a business dominated by tech giants. Facebook and Google accounted for about three-fourths of U.S. online advertising last year, according to Brian Wieser, global president of business intelligence at GroupM, the big media buyer. That has left Bustle and other online publishers to fight for the scraps. Many are trying to adapt by relying less on advertising and more on other models: subscription paywalls, live events, TV shows, and e-commerce.

Meanwhile, traffic to Bustle.com, the company’s flagship, has declined. From December to March, it dipped about 13%, from 37 million monthly unique visitors to 32 million, according to the measurement company Comscore. Bustle spokeswoman Kimberly Bernhardt attributes the decline to seasonality and says the online audience across the company’s portfolio is growing.

Goldberg says there’s plenty of ad money up for grabs offline, much of it still parked with print magazines. But whereas Condé Nast and other publishers built loyal audiences by spending lavishly on editorial content—a Gore Vidal essay here, an Annie Leibovitz fashion spread there—Goldberg has taken the opposite approach, relying on a young cast of freelance writers, some of whom complain about being underpaid. Erin Corbett, who wrote for Bustle for a year starting in 2016, says she was initially paid $10 an hour, without benefits, for a seven-hour shift during which she was expected to write three to five blog posts. She was later bumped up to $12.50 an hour.

Anna Menta, a former Elite Daily writer, wrote on Twitter that she was fired from her full-time salaried job at Elite Daily when Bustle bought the site. She said it then hired her back as an hourly employee with no benefits. Just before Bustle bought Mic last year, most of Mic’s staff was laid off. “All involved in creating this chaos should be ashamed—but none more than Mic CEO Chris Altchek and Bustle CEO Bryan Goldberg,” Mic’s union wrote in January.

Goldberg notes that his writers now all make at least $15 an hour, the minimum wage in New York City, where his company is based. “We continue to increase freelance rates and pay competitively for the industry,” Bernhardt, the spokeswoman, says, adding that Elite Daily writers who were moved to part-time were paid a higher hourly rate than their salary equivalents. When Bustle acquired Mic, Goldberg says, the website couldn’t make its next payroll, but he kept 35 people on staff. “We stepped in and preserved dozens of jobs,” he says.

To date, Goldberg’s reboot of Gawker has gone about as smoothly as the introduction of Bustle—which is to say, not smoothly at all. In January, Gawker’s two full-time writers quit, claiming the new editorial director, Carson Griffith, had made offensive comments about race, the poor, and the penis size of an acquaintance, according to the Daily Beast. Goldberg hired a law firm to investigate the comments and says that investigation cleared Griffith of any wrongdoing. Griffith declined to comment.

When Gawker makes its debut again this fall, Goldberg says, he wants to publish deeply reported long-form journalism. He’s hired Dan Peres, a former Condé Nast editor who ran the now defunct men’s fashion magazine Details, and says he’ll lure well-known magazine writers. “I want Gawker to be a peer of Vanity Fair, the New Yorker, and the Atlantic,” he says. “It won’t happen on Day 1. We probably won’t be there a year in. But can we be there five years in? The answer is yes.”

In the meantime, Bustle’s online media peers continue to struggle. In the past year, the online news outlets BuzzFeed and Vice have cut hundreds of jobs; Defy Media, the owner of a collection of online outlets, shut down; and Gizmodo Media Group, home of Jezebel, Deadspin, and the Onion, sold for less than what Univision paid for most of the sites three years earlier. Such developments bode ill for online media in general, but they might actually be good for Goldberg, who says he can run a media business in lean times and is still in the market to add to his portfolio. “I like that these are tough days,” he says. “This is an era when you can distinguish yourself. There are very few evangelists of optimism left in this industry. I’m one of them.”

To contact the editor responsible for this story: Max Chafkin at mchafkin@bloomberg.net, Felix GilletteJeff Muskus

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