Breaking Media Nears 20, Still Sees Big Growth Potential

By: Christiana Sciaudone

Breaking Media is nearly two decades old, but the owner of sites like Above the Law and Fashionista still sees room to grow. The only question is how to fund that growth.

“The markets we are in have a lot of potential, still, otherwise we wouldn’t be doing this, and we want to give ourselves the best opportunity to do that,” John Lerner, chief executive officer at Breaking Media, said in a September 24 interview. “If someone came along and was the right fit, we can always have that conversation.”

Breaking Media’s properties started as blogs back in an era when everyone was starting blogs—much like today’s newsletter boom. The company’s revenue is still driven heavily by marketing budgets, but it has evolved from primarily banner ads to more custom marketing services, in large part thanks to the first-party data it has on its audiences. Most of the readers come direct or from newsletters, and any search traffic happens naturally, with the focus on quality news over SEO-specific content, Lerner said. Social drives a very small portion of the readership.

Although it doesn’t charge for content today, it is beginning to experiment with a subscription network to its fashion label that offers access to editors and industry players. In addition, it runs a few events through its MedCity News brand. It’s also considering the future potential of webinars, podcasts, and video.

Slow growth

Semafor’s Justin Smith and Carter Burden III, a descendant of railroad and shipping magnate Cornelius W. Vanderbilt, founded Breaking Media. Since its launch, it has raised money through friends and family and small group fundraising rounds, with current investors supporting the admittedly slow growth of the company, Lerner said. But he prefers a measured approach.

“There is a challenge that you take on too much money. You expect things to grow faster than they can grow,” Lerner said. That said, Breaking Media may need to turn to new outside investors if it wants to tap into the promise of its markets. 

Breaking Media runs Above the Law, Fashionista, Dealbreaker, MedCity News and Breaking Defense. Above the Law represents about 50% of the emails in the database, with the rest spread out fairly equally among the other sites, Lerner said.

Today, Breaking Media has a 51-person team, brings in revenue of $10 million a year and is profitable—not hugely, but it is.

“Our model has been, put out great content initially, get traffic,” said Lerner, who joined the company in 2011 to help guide its business strategy. Accordingly, the number one expense is its editorial team. 

The company is laser-focused on getting more first-party data and information on users and helping advertisers in every vertical hyper-target who they want to reach. Lerner said that, for example, if a company wants to reach lawyers in Southern California who focus on taxes, Breaking Media’s Above the Law can reach them, and that keeps ad customers coming back.

The five websites attract 5 million unique monthly visitors and have collected 1 million reader emails. One primary tactic for acquiring these emails is its registration wall, which gates the content after a few visits to each site. That leaves a big opportunity for Breaking Media and a lot of people left unregistered.

Part of the delay in getting data has been that “we were the last publishers to say, maybe we should ask for an email address” when readers visit the sites. Lerner’s goal is to increase the number of email addresses in the databases by 20%, and said reaching 50%, 2.5 million people, would put them in a “really good position.”

New ways to grow

Six months ago, Breaking Media launched the Fashionista Network, its first paid subscription service, which was prompted by Fireside, a company that offers interactive streaming. For $8 a month or $60 a year, members get access to roundtables featuring Fashionista editors and “major industry figures,” as well as a chance to win goodies.

That’s an accessible price for the younger people interested in the fashion business who may still be in school or starting out with their first (underpaying) jobs. It’s still early days for the networks, but “the numbers are positive,” Lerner said. Similar networks may work for other industries, too, and it’s something that has been discussed internally.

Breaking Media is looking deeper into webinars, podcasts—which already get “tremendous” engagement—and video, though the platforms are a bit of a black box in terms of accessing any useful data. 

“Getting a lot of data on a podcast is not that easy, especially to inform advertisers. So we’re trying to look at ways to and it’s a good challenge to have,” Lerner said. “It’s almost the challenge that I inherited when I came to the company. People love this product. How do you make money now?” 

One thing not at the forefront for Breaking Media is artificial intelligence. While it has some potential to access nearly 20 years of archives, Lerner doesn’t see AI taking the place of journalists any time soon. 

“There’s something there that AI really can’t replicate that at this point,” Lerner said. “Or at least, I think we’re safer from AI being narrowly focused and really good at knowing what we do.”