Fourth in a series. Previous installments:
One Fateful Phone Call: How I Ended Up At Wired
Wednesday, July 9th, 1997. I left Wired for the second and final time three weeks after IDG offered me a chance to run my own show. Louis, Jane, and my editorial team took the news with grace, sending me off with an awkward but heartfelt party, a lovely custom Wired cover about my future exploits(1), and a bound edition of the magazine’s first year.
“I feel a great weight lifting off of me,” I wrote in my journal the day after I left. I’d been struggling with my place at Wired for more than a year. I was an aspiring front man relegated to a supporting role. IDG, I told myself, would let me shine.
But taking the role IDG offered also meant the overwhelming pressure of being responsible for…everything. My next journal entry: “And another weight descending.” I was past being the kid who hustled to make shit happen in an enterprise that was bigger than himself. The gravity of “being the man” settled around me. I agonized, questioning my abilities and my decision. “I start with IDG next week,” I wrote in mid August. “I am anxious about it and in the pit of my stomach is that feeling – that I don’t want to do this, that this is the wrong job for me.”
Whoever said “trust your gut” must have been casually rich, because even as my gut screamed “this is not going to work out,” my head ticked off all the reasons I had taken the job: An impressive title, the chance to build something from scratch, and a salary that would allow me pay off my grad school debt.
We are often uncharitable to ourselves, and those of us who happen to keep journals must visit their pages with the armature of grace. I struggled with the unknowns capering about my future. IDG had given me a chance to chase a story I knew was going to be huge: The impact of the Internet on business and the economy. But what right did I have to tell that story?
On the one hand, I had a billion-dollar corporation willing to fund my crazy idea for at least a year, more if the publication showed promise. On the other hand, despite my five years at Wired, I still had no idea what I was doing. I didn’t know how to launch a weekly magazine, how to hire a business team, how to craft a subscription marketing strategy, how to navigate a large corporation, or even how to find a printer. I didn’t feel like an impostor, it felt worse than that. I felt like a fraud.
The night before I started, I dreamt about my first day at IDG. In the dream, the company had given me an office in a dreary cubicle at one of their “Worlds” – PCWorld, MacWorld, it didn’t matter. My desk was grimy, my computer didn’t work. At the end of the day Kelly Conlin, the President of IDG, called an All Hands meeting. His agenda was packed with minutiae, and I squirmed as I waited for an impending climax. As he was about to wrap up, a molten dread spread through my body – I knew he was going to call me out in front of the entire company. “You might be wondering,” he said to the crowd, “what this guy is doing here. Well John, what’s your answer?”(2)
But the job of an entrepreneur is to push past all that doubt and figure out a path forward. I purchased a suit – three, in fact, with matching ties – and for the first time in my professional life, I got dressed for work like what I wore actually mattered. I may not have known exactly what I was getting myself into, but maybe clothes actually could make the man?
***
In late August, I flew to IDG headquarters in Boston for my first week as the CEO of a yet-to-be-named Internet weekly. While my company would be based in San Francisco, a bit of orientation at the mother ship was required. Before reconnecting with McGovern, I met with his team – professionals with decades of experience publishing computer trade magazines. They answered many of my questions about finding printers, setting up an office, and navigating IDG’s corporate culture(3). I learned how McGovern managed his sprawling empire: At the end of each calendar year, every one of McGovern’s companies submitted annual budgets to a board of directors that he alone controlled. That meant I’d have three or so months to build my case. If McGovern didn’t like my plan, he’d ask for changes. Oh, and yes, he could simply refuse to fund it. But he wouldn’t do that in my case, I was assured. Everyone knew that this new Internet weekly was Uncle Pat’s top priority.
McGovern was my final meeting of the week. Despite his lieutenants’ supportive words, I still found myself doubting I had made the right decision. When I described the publication I wanted to create, I sensed that my new IDG colleagues instantly fit my narrative into their own corporate world view. In a meeting with IDG’s vice president of finance, for example, I explained my plans to launch a magazine with paid circulation. His eyebrows knitted. “Why?”
Asking readers to pay for a magazine simply didn’t compute with him – or anyone else at IDG. Paid circulation was for publications that burdened themselves with an unnecessary commitment to traditional journalism. IDG made trade books, not The Economist. Their circulation was “controlled” – magazines are sent free of charge to “qualified readers,” usually IT (information technology) leaders responsible for purchasing the products covered by the magazine’s editorial content. A controlled circulation magazine makes all its money through advertising. Here was this kid saying he was going to buck a practice that had made IDG the richest company in trade publishing. “Crazy Wired dude,” I imagined them all saying after our meetings. “He’ll soon realize his mistake.”
Timid and wary, I knocked on Pat McGovern’s door the morning of my final day in Boston. McGovern welcomed me warmly and asked after my visit – were my meetings helpful? He motioned me to sit, and we spent the next 20 or so minutes chatting pleasantly and saying very little. If McGovern had anything important to relate, he was saving it for another time. I wasn’t in the mood to poke the bear, so I kept my paid circulation dreams to myself. We agreed that the next step was for me to return to San Francisco and get working on a business plan for my new publication.
The conversation began to stall, which I took as my cue to leave, but McGovern paused as if remembering something. He motioned with his index finger, then pointed toward a drawer behind his desk. Reaching down, he produced a slim portfolio, the kind you might use to spruce up a high school science project.
“Before we hired you, I wrote this up,” he told me. “You might find it useful as you work on your business plan.”
I accepted the document and inspected its title page, which said simply, and in quotes: “Internet Weekly.” I turned to the executive summary on page one: “A controlled circulation weekly serving purchasers of Internet products and services.”(4)
As I would discover over the course of the next four tumultuous years, Pat McGovern always had the final word, even if I willfully ignored him along the way. On the flight back to San Francisco, McGovern’s business plan dutifully tucked in my briefcase, I plotted my next move. I would reject McGovern’s advice and stay true to my own vision. If he didn’t like what I made, well – he could always fire me.
***
The next week I settled into an empty office in one of IDG’s buildings in San Francisco’s south of Market district.(5) I hired a small team(6) to help me build my business plan, a draft of which had to be ready by November, in two months – in time to present at my fledgling company’s first official board meeting. My “board” consisted of myself and IDG’s top four senior executives – its President, COO, VP Finance, and of course the Chairman – McGovern himself. This crew spent most of their time flying from one IDG subsidiary to the next, sitting in board meetings and governing Uncle Pat’s empire. This was before Zoom, everything was done in person.
To mollify McGovern, I named my new company “Internet Industry Publishing.” I figured that would buy me time as I built a pitch so compelling, so overwhelmingly and obviously right, that my Board would abandon their decades-long commitment to trade publishing and back my bid to become The Economist of the Internet age.
I presented my plan – “The Industry Standard, a Business Proposal” – in mid November to a polite but skeptical Board. We’d agonized over its details – we had to, because the market we purported to serve had to be conjured from thin air and active imagination. Our readers would be “architects of the network economy” who “HAVE BOTTOM-LINE RESPONSIBILITY FOR LEVERAGING HIS OR HER NEW OR EXISTING BUSINESS INTO OR THROUGH DIGITAL TECHNOLOGIES AND THE INTERNET.”
Yes, I put that part in all caps. And I was shouting – I needed McGovern to understand the needle I was attempting to thread: My readers would have influence over purchasing, the coin of the realm in a controlled circulation model. But because they were business people, not IT guys, they relegated the actual purchasing to others. That meant the magazine would attract brand advertisers like BMW or Apple, as well as Internet equipment makers like Cisco or IBM. And brand advertisers only spent money in paid circulation magazines.
Put another way, our readers would pay for a subscription, thank you very much. As a sop to IDG’s preferences, my circulation mix included a segment of controlled readers, but my plan was to slowly convert them to paid over time.(7)
My plan projected a loss of $5.5 million in year 1, but profits of $10 million by year 3. Looking at it now, it’s fair to say what I presented was both audacious and absurd. No magazine ever made that much money, that quickly. Certainly not one premised on a paid circulation model – which took five to seven years to turn a reliable profit. Then again, none of us could have predicted what came to pass: We lost nearly $8 million in year one, which nearly killed us. But by year three, we banked a profit of more than $20 million. In year four, we were dead.
After the meeting, IDG President Kelly Conlin took me aside and delivered the board’s response. Overall, a good presentation, he said, well received. Just a few minor notes. First, we think it best if you pursued a controlled circulation model – that would save you millions in marketing expense. And secondly, there was the matter of the name.
“The name?” I asked. “What about the name?” I was proud of “The Industry Standard,” it evoked old time journalism with a knowing wink toward the technical protocols that underpinned the Internet industry.
“Well,” Conlin sighed. “It doesn’t have the word “Internet” in it.”
“That’s on purpose,” I responded, flat footed. I had expected pushback on the circulation plan, but the name? There was no way I was going to call a product I created “InternetWeek”. I was prepared to die on that hill, and I told Conlin as much. He smiled, demurred, and suggested I think it over. $5.5 million is a lot of money, after all.
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- My colleagues chose the image from my first ever Wired cover story, on the game company Sega. The back page featured an advertisement for “Absolut Battelle,” featuring a bottle of bourbon. I found it buried in a dusty box, one among dozens stored for decades across five garages and three states.
- Recording this dream inhabited five pages of scrawl in my journal, written on the plane from SFO to Boston on my actual first day. In the dream, my answer was incomplete, ineffectual, and flat. Terrifying.
- IDG folk were absolutely in the tank for the company’s corporate culture, which evinced all the trappings of a voluntary cult. I knew about this going in, but man, experiencing it first hand was another thing. I’ve always been a “participant observer” – a practice that served me well as a journalist. But this culture demanded a commitment I wasn’t ready to proffer. I’m not much of a joiner, and almost immediately my colleagues sniffed that out.
- I’d kill to find that document, and may yet. I still have four or five boxes to search through.
- The office was disturbingly similar to the one I imagined in my dream just a week before, and also just two blocks from my former colleagues at Wired. As a result, I never went out for lunch.
- Shout out to Stacey Foreman, Debra Williamson and Matt McCallister
- A freemium model, if you will.
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