April 4, 2023

Multiple Deals Show Opportunity in Niche Media

While much ink is spilled on whether or not Vice will go bankrupt or if BuzzFeed can introduce another AI gimmick to get investors excited, niche operators are proving opportunity exists with multiple deals taking place over the past week.

But first… A word about our sponsor, Omeda.

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The featured speaker this year is Jessica Sibley, CEO of TIME. She’ll be talking about her blueprint for preparing a 100 year old brand to tackle the next 100 years, the company’s strategy with its Studios, TFK, and commerce with Taboola initiatives, and so much more.

You’re not going to want to miss this event. Get your ticket for OX6 today!

Now let’s jump in…


On Monday, the Financial Times announced that it had acquired a majority stake in Endpoints News, a biopharma publication.

This acquisition marks a significant milestone in the FT’s expansion in the US, where Endpoints is based, and deepens the FT’s coverage of the dynamic biopharma sector.

The investment in Endpoints forms part of a corporate development strategy that has seen the FT Group diversify its business in strategic areas. It follows the recent acquisitions of the product and consulting divisions of Wavteq, an economic development consulting firm; TNW; an events and media company; Alpha Grid, a content production company; GIS Planning, an investment intelligence company; and Longitude, a specialist provider of thought leadership and research services.

Lazard represented Endpoints News and when I asked for details on financials, both Lazard and publisher Arsalan Arif couldn’t offer specifics. The inclusion of Lazard as the seller’s bank leads me to believe that this was a large acquisition, though actual numbers would be pure speculation.

But what I find most interesting is how the business model is going to evolve.

A year ago, I spoke with Arsalan for the AMO podcast. Endpoints has, historically, had a very unique subscription model. At the time of the conversation, about 50% of its revenue came from advertising. The next 25% was subscription and then an additional quarter from events. But it was the subscription model that was so unique to me. In the episode, I described it like this:

On your business model page, which I think is one of the most transparent pages I’ve seen any media company put up. You say that enterprise subscriptions are the most important way to support your business. Your model is unique, because you charge $1,000 per company to get unlimited seats to Endpoint News, and that doesn’t matter if there’s 10 people at the company, or 1000 people at the company. Can you talk about the logic behind this strategy because it is fundamentally unique compared to most other media companies?

Ultimately, he explained that he wants to “make the discovery of our product and the discovery of our news products as accessible as possible to everyone at these companies.” One of the challenges for hard paywalled companies is organic growth, since so much is locked. By keeping much unlocked—and only locking a small percentage of the top stuff—Endpoints has been able to grow and generate revenue simultaneously.

Moving on, Arsalan explained later in the episode that:

It’s not a viable model unless you also have a significant advertising business, which we do. Our advertising business right now is much larger than our subscription business. Though, you’re right, as you quoted that type of revenue for us, though, again, this is a media company. This is the type of stuff you learned it’s a little bit different than other kinds of company. Right now for us that subscription revenue is more important to me on a long-term basis to me for the health of my company in our company than the advertising revenue is.

You can have an advertising business, and you can have a subscription subscriptions business together. You can have both…

And this is critical to understand because it explains how Endpoints got to where it is today. At $1,000 a year, a company like Pfizer could get its entire company into the database—all with first-party data. This is critical for Endpoints because it can then market to those people for advertisers.

But going forward, that business model is going to evolve. When I spoke with Arsalan after the deal was announced, he spoke highly of all the learnings that FT has when it comes to a metered model. He said:

What’s important to us is that we have a subscription price that speaks to every company and person in our audience. What we are going to do is add new features and coverage and then put out an enterprise subscription for each company. We hired a new CRO who is rolling that out this summer.

Should a Pfizer and a genetic startup really pay the same amount of money for a subscription to Endpoints? Probably not. And so, each company will have its own “unlimited seat” option available to them, but the price will vary.

So, what comes next? Endpoints will become part of the FT Specialist Group, which powers other niche, professional publications. At first glance, Endpoints stands out because every other brand is financial industry-related, with brands like FundFire, FT Adviser, Banker, and others. The inclusion of Endpoints would indicate an evolution of FT’s strategy into additional b2b areas.

But this makes sense, actually. Back in 2019, FT led the Business of Fashion’s Series B. While this was a minority investment, it’s clear that FT sees opportunity in these niche publications. The question is: will the Financial Times be a buyer of others? As one operator told me recently, he expects the next year to be a very consolidating one in media M&A. We’ll have to wait and see.

On the topic of consolidation, although a very different niche publication, Flying Magazine announced two acquisitions last week. Flying Magazine is owned by Craig Fuller, founder and CEO of FreightWaves, who I spoke with a couple of years ago.

The first acquisition was ByDanJohnson.com, which covers “light sport aircraft (LSA), sport pilot-eligible kit aircraft, and ultralights.” A few days later, it announced the acquisition of Plane & Pilot, a magazine that covers “the piston community and the world of recreational and private pilots.”

When I asked Preston Holland, the company’s COO, he explained that they had found a press release announcing their competitor being acquired. But because the acquirer was focused on music mostly, the Flying team assumed they wouldn’t want Plane & Pilot.

So, we reached out on Sunday, had a signed LOI on Monday, and closed Friday. We didn’t pay much for the business, mostly taking the deferred liability off their books and then some (but not much) cash.

We saw it as an opportunity for us to consolidate the industry, bring some extra value to our subscribers and our advertisers (the overlap was almost 100%) and grow the content as a brand inside a bigger brand.

Both [acquisitions] are asset purchases, so we don’t have to take on any contracts or liabilities (outside of those clearly stated).

This consolidation of the industry is a trend for Flying Magazine. Back in May, it announced that it had acquired the aviation portfolio of Heartland Publishing. In the announcement:

Heartland Publishing—a classified listings and buyer’s directory publisher that has been in business for more than 50 years—boasts more than a dozen aviation brands, including Business Air, Aviator’s Hotline, Aviator’s Properties, FBO and Charter Today, and AircraftforSale.com.

The bolded site is important because it is an indication of where Flying Magazine is going from here. So is this tweet from Flying Mag’s COO. And this tweet from Craig Fuller.

While most media companies focus on advertising and subscriptions to monetize, Flying Magazine is looking to get closer to where significant money exists: marketplace sales. By amalgamating audience from multiple publications, it can get more eyes on the marketplace.

It does this two ways.

First, there’s the new paper product that Preston and Craig both reference. If you knew that all Flying Mag and Plane & Pilot subscribers were automatically getting the listings newspaper, wouldn’t you want to advertise? Where else can you get this sort of scale attention of actual pilots?

And second, if you visit AircraftforSale.com today, it redirects to Flying Mag’s beta marketplace. Imagine a future where it takes a cut of every airplane sold. Considering many might sell for six figures, the fees could be significant.

If there are other flying-related magazines out there—and I’m sure there are—I’d expect to see additional action from this team. Ultimately, they make money on advertising, subscriptions, and down funnel opportunities. That makes them a far better buyer.

Like I said up top, while most are focused on what the big, generalist media companies are doing to stay afloat, niche operators are showing that there is significant money to be made. We should celebrate these wins and use them as frameworks for how we build.

Thanks for reading. If you have thoughts, hit reply. Become an AMO Pro member to receive even more AMO and for an invite to the community Slack. Have a great week!