Welcome! I'm Simon Owens and this is my media newsletter. If you've received it, then you either subscribed or someone forwarded it to you. If you fit into the latter camp and want to subscribe, then you can click on this handy little button:

Let’s jump right into it…

There's a massive amount of media consolidation afoot

Back in 2018, I wrote a piece titled “The VC-fueled media bubble is popping.” In it, I claimed that we’d reached the end of an “era that was fueled by easy VC money and Facebook-inflated traffic.”

The argument is probably pretty self-explanatory for those who read this newsletter, but to recap: In a period spanning roughly from 2012 to 2016 or so, investors collectively poured billions of dollars into digital media startups that claimed to have amassed huge Millennial audiences. Backed by charts depicting hockey stick growth, these startups announced massive fundraising rounds, sometimes into the tens of millions of dollars.

We all know what happened next. Facebook pivoted away from news, revealing these audiences to be a mirage. The startups, which had never produced much revenue to begin with, suddenly didn’t have any hockey stick graphs to point to. As a result, the funding dried up, and they were forced to either greatly reduce their valuations (Vice, Buzzfeed), sell at fire sale prices (Mashable, Mic), or shut down completely (Dose, Little Things).

The investors licked their wounds and returned to making bets on things like crypto and tech.

Or so I thought at the time. As it turned out, they never stopped investing in media, it’s just that their strategy changed.

Instead of making massive bets on individual outlets, investors are pooling their money and using it to make hundreds of acquisitions, usually under the banner of a holding company.

To give you a sense of what I mean, here are seven media companies that have been particularly active in the M&A space over the past few years. I’ll italicize their acquisitions:

Vox Media: SB Nation, The Verge, Vox.com, Recode, New York Magazine, Cafe Studios, Punch, Hot Pod, Curbed Network, Epic Magazine, Eater, Polygon.

Minute Media: FanSided, Mental Floss, Wazimo, Player’s Tribune, The Big Lead, 90min, DBLTAP.

Recurrent Ventures: Futurism, JancisRobinson.com, Mel Magazine, Donut Media, BobVila.com, Kitchenistic, Task & Purpose, Car Bibles, TheDrive, Domino, Field & Stream, Interesting Things, Better You, Military Spouse, Outdoor Life, Popular Photography, Popular Science, Saveur, The War Zone.

Red Ventures: Bankrate, CNET, Healthline, Lonely Planet, The Points Guy, Healthgrades, Gamespot, Greatist, Medical News Today, Metacritic, MyMove, PsychCentral, TV Guide, Slumber Yard, ZD Net.

Dotdash/IAC: Verywell, Investopedia, The Balance, The Spruce, Simply Recipes, Serious Eats, Byrdie, Brides, MyDomaine, Lifewire, TripSavvy, Liquor.com, Treehugger, ThoughtCo, PEOPLE, Better Homes & Gardens, Allrecipes, Southern Living, InStyle, REAL SIMPLE.

Bustle Digital Group: Bustle, Mic, Elite Daily, W Magazine, Gawker, Some Spider Studios, Scary Mommy, Fatherly, Inverse, Zoe Report, Flavorpill, The Outline, Input, Nylon, Romper, The Dad.

Outside Media Group: athleteReg, Backpacker, Beta, Better Nutrition, Bicycle Retailer, Cairn, Clean Eating, Outside Magazine, Climbing, CyclingTips, The Fly Fishing Film Tour, Gaia GPS, Gym Climber, IDEA Health & Fitness Association, National Park Trips, Outside Business Journal, OutsideTV, Oxygen, Peloton Magazine, Pinkbike, PodiumRunner, Rock and Ice, Roll Massif, SKI Magazine, Trailforks, TrailRunner, Triathlete, Vegetarian Times, VeloNews, VeloPress, VeloSwap, Warren Miller Entertainment, Women’s Running, Yoga Journal.

This is by no means an exhaustive list, but with just an hour of Googling I was able to find over 100 acquisitions, most of which occurred within the last few years. A few things jump out to me when scanning this list.

• Most are backed by investor money: I purposefully avoided listing acquisitions made by old school media conglomerates like Disney, News Corp, and Axel Springer. Most of the holding companies I listed above were launched during the 21st century and are backed, in part, by outside investors.

• Smaller bets: Gone are the days when investors drop $200 million on Series C rounds. Most of these acquisitions were in the low eight figure range. In the few cases of larger spends, a more mature legacy outlet was being acquired (eg, Dotdash’s acquisition of Meredith titles and Vox Media buying New York Magazine)

  Niche: VCs used to invest in general-interest outlets that aimed to achieve massive scale. Even Mashable and Mic, both of which started out focused on niche topics (tech and policy, respectively), eventually pivoted to general interest. But most of the outlets I listed above are targeted to niche communities. These holding companies, in other words, achieve their scale by amalgamating audiences across dozens of verticals.

• 100% ownership: These holding companies aren’t taking equity stakes; they’re buying the whole pie, most likely so they can have complete control over each outlet and capitalize on synergies. Speaking of which…

• Synergies, Synergies, Synergies: Sure, every company that acquires another company claims to do so for synergistic reasons, but it’s easy to see how each of these holding companies aim to combine their sales teams and tech platforms to generate bigger audiences and serve better, more targeted ads.

So what are we to take away from all of this? Well, for one, that investors never really pulled out of digital media. But also that good ol’ fashioned consolidation never went away. Just as the Time Incs and Conde Nasts of the world spent most of the 20th century trying to expand into every monetizable niche, their 21st century counterparts are operating under the same playbook. We probably still have a few years before we find out whether this new crop of investors is savvier than the last.

1,507 of you open almost every single newsletter I send out

If just those readers were to become paying subscribers, then I’d be able to generate a full-time living from this newsletter. If you get value from the work I do here, please consider subscribing. It’s the only way to ensure that this newsletter will continue. Use the link below and get 10% off for your first year:

Get 10% off for 1 year

Quick hits

There’s a new startup aimed at bundling subscriptions for indie business journalists. [Axios] These kinds of startups are part of what I'll call Creator Economy 2.0. They provide creators with financial cushion and network effects to make their transition into independent content creation much easier.

Could AI replace audiobook narrators? Maybe in some nonfiction texts, but I just don't see an AI performing a convincing fiction narration, at least anytime soon. [Publisher’s Weekly]

Building a career through livestreaming platforms like Twitch just seems like such a grueling existence. Even the super successful streamers are miserable. [WSJ]

For 20 years, tech companies have tried to make TV ads shoppable but haven't achieved any traction. Amazon may be on the verge of cracking the code. [Mike Shields]

"It’s never been easier to get approval from senior managers to strike paid deals with creators to produce original, short-form content for the Facebook app and for the Reels feature on Instagram." [The Information]

Substack hired a PR representative to work directly with its writers to get them interviewed for podcasts, Twitter Spaces, articles, and other mediums. I wonder if this is something that's only available to Substack Pro writers? [Business Insider]

The Atlantic debuted a newsletter strategy last week that many have described as competition for Substack. But is the magazine offering enough to lure star writers away from their solo ventures? [YouTube]

Amazon isn’t the only one to test out video shopping. YouTube is also making a big push into ecommerce. [Bloomberg] Google wasn't going to take Amazon's encroachment on its advertising business lying down.

VCs are starting to give money to creators in exchange for a cut in future earnings. In other news, if any VCs want to give me $1.7 million for an equity stake in my Substack, my inbox is open. [Business Insider]

Remember Bitly? It never went away. It pivoted to become an enterprise analytics company and now it's trying to move into the link-in-bio space. [The Information]

ICYMI: This agency helps B2B tech companies develop their own podcasts

The creative agency Motion helps tech brands with audio storytelling.

Want to chat with me directly?

I have a private Facebook group that I only promote in this newsletter, and I try my hardest to respond to everyone who comments on it. We get up to some pretty insightful discussion on the media industry. You can join here: [Facebook]