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By Thomas Baekdal - June 2015

The Thing About Re/Code And Individual Media Brands

I was reading Mathew Ingram's article about Re/Code, called "Was the power shift to individual media brands just a mirage?" and I got very annoyed by it. Mostly because of the quotes in it:

First Bob Lefsetz wrote:

Walt Mossberg and Kara Swisher built a team of experts. But nobody cared, nobody went to the site, they thought their minions would follow them but it turned out they were aligned more with the Wall Street Journal, their former home, than the writers themselves. It's kind of like when the lead singer leaves the band... good luck!


Just because you're a star don't think you're bigger than the enterprise.

Then Dan Lyons posted:

All of that nonsense about journalists with big personal brands was just that-nonsense. Walt Mossberg's power came from his association with the Journal. Pogue was better off at the Times, Levy was better off at Wired, Nate Silver was better off at the Times, and so on. The late David Carr knew this, and I suspect Nick Bilton does too.

And also:

There is no way, currently, to build a sustainable, profitable business out of publishing news online. Maybe someone will dream up a new model. But the current one - put ads next to stories - is dead on arrival.

There is a lot of truth to all of this. But I'm annoyed by it because Re/Code isn't an individual media brand. It is as traditional as you can possibly imagine.

The real world of individual media brands is stronger than ever, and they are nothing like Re/Code.

Let me explain.

First of all, what is an individual media brand?

Arguably, we can define this in two ways. It can either be an individual creating a media brand from scratch, turning it into a success. Or it can be someone famous using his or hers already built up fame to start something new, capitalizing on existing connections, contracts, investors, and so forth.

To give you a good example of the former, we have a person like Derek Muller from the amazing YouTube channel Veritasium. And, as of this moment, he has 211 videos, 158 million views and 2.7 million subscribers since its launch in 2011.

Here is an example of what he does:


By all accounts, he is a successful individual media brand. And just to put this into perspective, think about this:

BuzzFeed, which people usually point to as the big successful digital native media site, now has about 750 million video views per month and more than 200 million uniques. That's quite a huge number.

But Buzzfeed also employs 700+ people. So, per person, they only have 0.28 million uniques, and one million video views.

Derek has 190% more than that, per month.

Want more examples?

What about Unbox Therapy? It's 365% larger than Buzzfeed, per person. What about Marques Brownlee? He is 550% larger than Buzzfeed, per person.

This is what I mean when I talk about individual media brands. It's individuals who have built up amazingly successful media companies around themselves, as persons. It's not companies at massive scale.

There a thousands of other people just like them. People who have managed to build up media brands around themselves as individuals, allowing them to earn more money and perform better than most popular media sites. And not just on YouTube.

So what about Re/Code? Was/is that an individual media brand? Not really.

Sure, it was started by Walt Mossberg and Kara Swisher along with a slew of other semi-famous journalists. But Re/Code has 44 employees, of which 18 of them are journalists.

There is nothing individual about that. This is a very traditional definition of a media company.

When they launched Re/Code a little more than a year ago, they did so with the backing of traditional media and investors. Specifically from NBC Universal News Group and Windsor Media.

This investment included a content partnership deal:

In addition to NBCUniversal News Group's strategic investment, Swisher and Mossberg's holding company Revere Digital LLC is also signing a separate content partnership with NBCUniversal News Group to partner on tech coverage.

While the two companies will maintain editorial independence, Re/code will have access to NBC video, the NBC News group will have access to breaking stories, and Re/code reporters will appear across NBC's on-air and digital platforms.

And they secured partnership deals for their events before they even launched the company.

CNBC will be Revere's media partner (Revere is the holding company of Re/Code) for its conferences and the two companies will collaborate on advertising to expand their respective reach.

And remember, while they today have 44 employees, they started out with 18 people, and planning to bring in 6 more.

That's 24 people ... at launch!

There is absolutely nothing 'individual' about this. The only thing that is partly individual was that Walt Mossberg and Kara Swisher had a level of personal fame, but that doesn't make them individual media brands. That's like saying that Harrison Ford is an individual media brand after he announced making a new movie in collaboration with Universal Studios.

This is as traditional as it can get. And it's a business model based, not on the people, but on the scale of the company. From the very start, Re/Code locked itself into an investor relationship, defined by what now seems to have been completely unrealistic expectations of scale.

Before Re/Code, when Walt Mossberg and Kara Swisher ran AllThingsD for WSJ, they generated about $12 million in revenue for News Corp, with about 8 million uniques.

And three months before the launch of Re/Code, they said this:

Starting Jan. 1, 2014, we will still be Web-siting and conference-producing and much more, albeit under a new corporate structure with new partners and investors. While we can't give any details yet - and there are details - you can assume that this new independent business will be laser-focused on continuing and extending Web journalism and conference journalism with the highest standards. Plus, we will be able to finally have added resources, so we can grow in new and exciting ways, including hiring more journalists and doing much more video.

So, apparently, Walt Mossberg and Kara Swisher believed that they could start over with a new site, and within 16 months build up a tech site that would be bigger than what they had on AllThingsD.

Why 16 months? Because that's how old they are today. And, as you know, they are now in a situation where they were forced to sell. That can only imply that they didn't meet their objectives, and is likely losing money.

What on Earth compelled them to think they could build a new tech media site, from scratch, in as competitive a tech news market as this, and become more successful than what they were before ... with 44 people?

What the heck?

I like John Gruber's take on this:

The tidbit that stood out to me regarding Recode is that they had 44 full-time employees - plus a few contractors. That's not lean and mean. The advantage the internet provides to new publishers is that there's so little overhead. You can go really far with a really small talented team. 44 employees sounds like Recode was trying to go head-to-head with the Wall Street Journal on the business/tech beat. Rather than start small and grow big organically, they wanted to start big. And so to start big they took on investors, and next thing you know, they had to sell.

That's exactly what is happening here.

I'm also reminded by Danny Sullivan, when he wrote this:

Third Door Media (home of SearchEngineLand and MarketingLand) started in late 2006. It never took investment. We grew our staff as our revenue grew, according to our business plans. In 2008, when the world economy crashed, we hunkered down and came through without losing people. In part, this was because we'd been careful not to overextend, not to build a large operation beyond what it could support with native revenue.

It's what I once called the SimCity model of growing. I used to often play the game years ago. I would take two approaches. One was to use the FUNDS cheat to get all the money I needed to build everything at once. But in doing this, I often found my cities built that way didn't thrive. Instead, naturally growing my city slowly over time allowed it to stabilize and do well.

Third Door Media has taken this SimCity natural approach, over the years. Our growth has continued. Two years ago, we were even able to take money out to return to some of our early employees, who have shares in the company. We've made the Inc. 5000 list four times in a row. We've done three hires this year and have several others planned, bringing our overall staff to nearly 50 people. This will all be funded by our own revenues, not because we had VC money pouring in. We also have a solid cash balance in the bank because our CEO Chris Elwell is dead serious (and right) on being conservative and being prepared.

Again, spot on!

This is why Re/Code failed and had to sell after merely 16 months. They were never an individual media company. They never understood what being an individual media company was about. From the first day, they tried to be a big traditional media company, with all the failings of such companies.

This is why they are in the situation they are today.

Mind you, Re/Code still has the potential to be a huge success. It's a wonderful site, and Walt Mossberg, Kara Swisher and all the others are some of the best in the business.

But, this is the reason I got so annoyed after reading how people reacted to Re/Code being sold to Vox. Like when Dan Lyons wrote:

All of that nonsense about journalists with big personal brands was just that-nonsense. [...] There is no way, currently, to build a sustainable, profitable business out of publishing news online.

No. Just no!

The real trend of individual media brands is alive and well. In fact, the trend of individual media is growing and getting more and more exciting every single day. You only have to look at individuals like Marques Brownlee to see how well this world thrives.

But individual media brands have nothing in common with the investments for scale, market valuations, and those things. As an analyst, I have nothing against that. But it's a completely different focus than what we see with the real individual media brands.

Re/Code had to sell because they weren't focusing on being an individual media brand. They instead tried to be a traditional media company. Designed with an unsustainable business model based on bringing in investors demanding scale above anything else. A mistake that we have seen so many times.

There are plenty of ways to build truly sustainable and profitable businesses around individuals.

For more on this topic, see:


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Thomas Baekdal

Founder, media analyst, author, and publisher. Follow on Twitter

"Thomas Baekdal is one of Scandinavia's most sought-after experts in the digitization of media companies. He has made ​​himself known for his analysis of how digitization has changed the way we consume media."
Swedish business magazine, Resumé


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