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Feb. 6, 2024, 2:17 p.m.
Business Models
LINK: buttondown.email  ➚   |   Posted by: Laura Hazard Owen   |   February 6, 2024

It’s been less than a week since The Messenger shut down, having “[burned] through $50 million in just eight months by pursuing obviously terrible ideas for a news site.” Details about the site in its final days — plus, of course, takes — continue to emerge. For your files! (And don’t worry, if you loved The Messenger, there’s something here for you too.)

Shooting The Messenger (Or how to turn a $50 million investment into $3 million of revenue),” Elizabeth Spiers, 2/6/2024:

Finkelstein wanted to replicate that with The Messenger, and brought along Neetzan Zimmerman, the viral content guru who had developed The Hill’s content farm/traffic engine. He hired Richard “Mad Dog” Beckman, who left Conde Nast circa 2010 after years of running ad sales there when he had trouble adapting to changes in the ad market and got demoted to run Fairchild’s ad sales.

The two of them together are not exactly the picture of media innovation in 2024. Zimmerman knows far more about the way the Internet works than they do and even what he’s doing is outdated. I teach a class on the topic at NYU and the people I bring into the program to talk to my students are working on things like using local LLMs to scrape public documents, building digital products that provide solutions to civic problems, and testing new business models that focus first on audience needs.

But this is the team that got $50 million in funding, because “experience.” And let’s be honest, they’re white guys of a certain age who fit the profile of the white guys of a certain age who funded them. (Insert culture fit bullshit.) The fact that a reach play monetized by programmatic ads is a laughable thing to build now was considered irrelevant because investors assume that prior success is indicative of lower risk. And possibly that white guys of a certain age are lower risk. (I joking refer to this as Demographic De-risking, but as a female founder who’s been told I’m too high risk despite having some successes under my belt, it does periodically make me want to move to a desert island with no internet connection and never think about this industry again. But I won’t because I’m a masochist.) A bunch investors basically paid a couple of horse and buggy specialists $50 million to build a Ferrari.

Top Messenger executive accused of homophobic slur,” Daily Beast, 2/5/2024:

[Jimmy] Finkelstein, too, repeatedly belittled the outlet’s top editors, three senior staffers noted — especially [Dan] Wakeford, deputy editor Michelle Gotthelf, and politics editor Marty Kady. Multiple insiders told Confider that Finkelstein would regularly call Gotthelf at 4 a.m. to berate her over the editorial direction of the site as she was in charge of the newsroom, including telling her he didn’t want to see any Trump trial coverage on the homepage. (Before joining The Messenger, Gotthelf settled with the New York Post over her claims she was sexually harassed and retaliated against at the company.) Finkelstein’s yelling would become so bad, senior staffers said, that some employees were left shaking and crying over how “rude and aggressive” he was. “And he always seemed to be worse with women,” a senior male editor told Confider.

“I deny berating top editors in the past eight months,” Finkelstein said in a statement. “I think it’s fair to say there were a handful of disagreements, but I deeply respected the editorial team, and our conversations were civilized.”

Meanwhile, [Richard] Beckman, who announced he was leaving The Messenger for health reasons just before the site’s spectacular implosion, also used his final few weeks to push some historical revisionism on his colleagues. Just before the site’s launch, he’d publicly pushed fanciful boasts about $100 million yearly revenue goals and impossibly high traffic, and also told prospective hires that The Messenger had enough funding to last three years, sources told Confider. But this past month, Beckman began telling employees that he’d urged Finkelstein to delay the launch of The Messenger for a year. Beckman, notably, was also the person sounding the alarm in the fourth quarter that the company was “out of money.”

“Post-mortem praise for The Messenger,” Real Clear Politics, 2/5/2024:

The Messenger published my clients’ political op-eds, my personal apolitical pieces, and hundreds or thousands of other thoughtful pieces across the political and apolitical spectra.

Look, The Messenger failed. According to some reports, it failed pretty badly. But that shouldn’t be a green light for all the onlookers to pile onto its leadership, like the early 20th-century people Roosevelt criticized, or like what keyboard warriors do when MMA fighters lose, or like what much of the navel-gazing media commentariat has done to Los Angeles Times owner Soon-Shiong.

The spectacular collapse of the Messenger is a lesson on how not to do journalism,” The Guardian, 2/2/2024:

Facile ideas that sound too good to be true — especially in this gloomy media environment — probably are simply bad. Even some of the highest-quality news organizations are struggling to survive; many are finding it impossible. There’s no such thing as a quick fix.

Second, the notion of “centrism” — often a thinly disguised conservative slant — as a surefire way to attract a mass audience and vast revenue is a well-worn joke. Let us recall Chris Licht’s failed experiment at CNN to do something like that, which featured an apology tour of Republican election denialists. Another flameout.

And finally, I can understand why some job seekers grasped at the Messenger’s straws. It’s tough out there. But if you’re an employed journalist recruited by a rich guy with lofty notions about saving the industry, you should run. Fast.

The Messenger’s desperate bid to merge with LA Times collapsed when time ran out,” The Wrap, 2/1/2024:

In the final hours of The Messenger, owner Jimmy Finkelstein reached out to offer a merger with the Los Angeles Times, telling his staff that a deal was imminent, The Wrap has learned. But the Los Angeles Times insisted that there was no such deal on the table, only a desperate call from Finkelstein to owner Patrick Soon-Shiong, according to an insider there.

Two individuals with ties to The Messenger told The Wrap that Finkelstein and Soon-Shiong were eager to merge their organizations, but could not get the deal done fast enough to outrun a lack of cash.

“Patrick was very keen to do the merger — which is why the announcement to staff about The Messenger closing was delayed. Patrick had the money, and at that point, Jimmy would have taken anything,” said the first individual with knowledge of the negotiations.

“Former Messenger employees sue shuttered news site,” Politico, 2/1/2024:

The lawsuit alleges that the company’s actions violated both federal and New York state labor protections under the WARN Act, and claims — as many reporters from the company also did on social media Wednesday — that The Messenger failed to deliver employees severance and terminated their healthcare.

Inside the meltdown at The Messenger: Out-of-touch brass, outraged staffers and pure pandemonium,” The New York Post, 2/1/2024:

The only thing they received was a FedEx account number to return their company-issued MacBooks to the New York office.

“I’ve got news for you, nobody is sending their laptops back, I can promise you that,” a staffer said.

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