Five years and about two months ago, I wrote a blog post announcing the creation of Federated Media Publishing. I will admit I was scratching an itch, not certain that it would work out. In that post I hedged a my bet – mainly because I was still smarting from the loss of my previous business – The Industry Standard – and I was not certain that I (or the world) was really ready for me to run a company again.
In short, I said that if the company succeeded, I might not stick around – after all, The Standard succeeded, and I stuck around, and that didn’t quite work out…well you can see where the psychology is going. This time, I remember telling myself, I’ll pull a Costanza and go out when I’m still ahead.
Well, that didn’t happen.
So as to not bury the lead too deeply, today marks my five-year anniversary as an employee of Federated Media Publishing, Inc. Apparently it was five years ago today that I signed some legal paperwork that officially made me an employee. At the time, I owned 100% of FM’s voting shares, and to this day, I am still the largest shareholder. That was a very intentional move on my part, and one that has served me – and I daresay FM – very well over the past five years.
By the Fall of 2005 I had assembled a team, an extraordinary group, some of whom are still with us, some of whom, after four years or so, have moved on. To my mind that is also a great accomplishment – the original team stayed for a very long time, at least in the life of a startup, and together we built a company that will endure. I’m proud of that, and of them, and of where we are today. Indulge me some pride, but the story of FM isn’t often told, and while I won’t take much more of your time here telling it, it’s certainly worth hearing should you be interested. (I’m happy to stretch this into a few hours, but the bourbon is on you).
I’m particularly proud that the core idea driving FM has not changed – thanks to search and social, media models have shifted, and a new approach was needed that understood the “conversational web.” FM set out to be a media company native to the social web, and five years in, I think we’ve succeeded.
But that’s not to say FM hasn’t changed. A few stats:
– FM had under half a million dollars in revenue in 2005. Five years later, we’re in the high eight figures of revenue. I’d love to brag about our current growth rate, but I think that’d be, well, bragging.
– FM launched with one segment – technology – and about ten blogs. We reached a few million uniques a month, and had roughly 25 million pageviews. Today, FM reaches 36 million uniques in four major segments (tech, business, lifestyle, and the real time web), and that’s just in the US (we’re past 70mm globally). We stopped counting pageviews when they eclipsed a billion. We’re the fourth largest pure play social media company on the web, behind Facebook, Blogger, and Myspace.
– FM has been a pioneer in bringing integrated, scaleable brand marketing to social media, first with blogs (2005), and then Digg (2006), the Facebook platform (2007), live events (Crowdfire 2008), Twitter (2009) and now location services like Foursquare (2010). Our partners, executions and programs have won countless awards, but we’re most proud of the tens of millions of dollars of revenue we’ve driven into the emerging world of independent content and platform creators online.
– The brilliant folks who invested in FM back in 2005 (including the New York Times, Omidyar Network, and various angels) have seen their investment increase twenty-fold, based on the valuation of FM in our last round (I’d argue we’re worth a lot more than that, but let’s stick with what’s on paper for now). Perhaps to their consternation, we have so far refused to sell the company, so they’ll have to be content with looking good on paper for the time being. And since that initial investment, we’ve brought in tens of millions of dollars through some extraordinary partners, and we’ve spent almost none of it. In fact, we’re now on track to add to our cash holdings year over year. I’m quite proud of that feat.
– FM was EBIDTA profitable for 2009, and so far this year, FM has turned a net income, with the best still ahead of us.
– Earlier this year, we established a new division focused on bringing the skills of publishers to marketers across digital platforms. This promises to be a very large and very scaled business. We also invested heavily in our technology platform, and while I won’t give away all that we are working on, it’s a very exciting platform indeed. In short, there’s nothing like it in market. I never thought, five years ago, we’d become a player in technology and data as well as in media, but then again, that’s the beauty of a startup.
– Perhaps most significantly, FM has evolved into a troop of 130 or so dedicated employees, led by an amazing President, who we hired this past Fall. And my work has changed, so much so that I can’t really imagine a better job than the one I have right now. I spend most of my time with partners – either media or platform and publishing, and in between I’m allowed to think a bit out loud, and work on my writing. I haven’t really changed my work hours, but I most certainly have changed what I work on.
And this, to me, is probably my greatest career accomplishment to date. I’ve never worked anywhere for five years – not Wired, where I lasted four years and change, or The Standard, where I almost made it to four. But somehow, as I enter year six at FM, I find myself energized, engaged, and thrilled to be here.
I think it’s because, way back in 2005, I made a promise to myself that I’d leave if I ever felt that I was in the way, or if I was consistently unhappy in my work.
I’ll admit, I’ve flirted with both of those demons over the past few years. And who knows, I may well again. But right now, sitting in a hotel lobby writing to you as I prepare for four meetings with clients in Atlanta, I just feel lucky.
Thanks, everyone – to our publishing partners, our clients, our investors and our employees, as well as all of you, who’ve read my thoughts here and cheered me on, criticized me, or both. I hope to make you all proud in the next five years of this journey.
John–Congratulations, my friend. It was an honor to be a part of FM’s first chapter, and I couldn’t be a more enthusiastic reader of the chapters being written right now.
Congrats, John. Uncrate turns five next month too. I’m truly thankful we hooked up with FM when we did. Without FM’s help, I doubt I would be writing this from my laser-protected, carbon fiber-walled, kevlar-reinforced, secret mountain lair.
Great post John. Thanks for making FM happen. Proud to be a part of it!
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Hi John
I’ve got to say thank you – as somebody deep in the start-up stage it’s good to know there may be light at the end of the tunnel.
And congratulations to you and the team at FM for the great achievements.
I agree with most of the comments above, this is a great post, very encouraging and worth-reading. There’s nothing better, to learn about business and the business world, than reading a real story or a real testimony by someone who knows and has expierence in business.
Thank you for sharing this, and congratulations.
Nice post, John. Proud to be a small part of it!
Thanks Chas, Pamela, Matt, Andrew, and everybody on Facebook and Twitter for the kind words. It’s thanks to you this is working.
Great post John. I love being a part of FM. I take great pride when I see your writing and traveling to clients increase. Great to see an interesting plan come together!
Congrats!
Nice post John. I really enjoy being a part of FM. I have a lot of personal pride in the work myself and everyone does here.
This is a great post!
You (and FM) have changed our lives in amazing ways. We are living the dream!
Thank’s for this works, John – a great post!
Glad you had the Stable! Congrats!
This was an amzing one to know..
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hey Art (mARTin) – thanks to you Fm exists! Thanks for the stable my man.
Wishing you and FM even greater success – any way you choose to define it, during the next 5 years. John, will you be coming to Tennessee after NYC? (I’m currently on duty in Nashville and would like to meet you.)
interesting
congratulations… i guess
in a nutshell
6 years
$60 million raised
big revenues (or at least not tiny)
but barely profitable
and not clear sustainably profitable
that’s a big success these days.
huh.
@insider – don’t judge the company without understanding its balance sheet. Wish I could share it with you, but …. Recall I said we have barely touched the money we raised. And we’re not “barely” profitable. And it’s been five years (not six), and just four of actual operating business.
So yep, I’m proud of that.
@John – sorry, yes 5 years not 6. but do tell, john. if one is going to crow in public about one’s success, it always begs the question when the details are scarce and fuzzy.
so, what is an ad network/content aggregator worth today and why?
nothing against FM (about which admittedly I hardly know anything) but generally speaking, there’s huge hype but little if any substance to back it up.
what comparables do you think are appropo?
i can come up with a few
Yahoo trades at about 4X LTM revenues and 28X P/E
ValueClick 2.5X LTM revenues and 15X P/E
Guessing FM’s LTM revenues at $60 million and trailing earnings as >$0 (please correct me) would give FM a generous valuation of $300-$400 million
not a failure by any means but not exactly a really happy deal for your investors, i dare say?
obviously i don’t really know what i’m talking about. so i ask you: if you are going to dazzle us, how about some substance, not just sparkles and hand waving?
@insider I’d love to respond in detail but I can’t in public. I can say your estimates of our numbers aren’t accurate. Now, as to what FM does, we’re not “an ad network”. Though with some of the past years’ multiples perhaps that was my mistake. We’re a new hybrid media company with a technology platform underneath it. Happy to take this offline if you’d like and explain that more. And thanks for taking the time and caring enough to ask smart questions.
John
thanks for the post esp the details of just what it takes to get there. Having done a few startups, I know the drill of what the cost is and how it really is a round a clock affair. (I have learned to scribble in the dark as not to wake wife and kids!)
What surprises me often is the lack of sharing in our industry about human side of building a business. thanks for the peek in.
Keep it going— and keep moving the business to a multiple not pinned to an ad net positioning! 🙂
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