Via Evan Smith and the Washington Post:
The New New York Times
The New New York Times, or NNYT, would have a writing staff of say 50 people. These are among the best journalists in the world, and lets say they wanted to pay themselves $200,000/year, a top salary for a reporter of that stature. That’s just $10 million a year in payroll expenses. Call it $12 million with benefits. Plus, they all have stock options in the new comapny
If TechCrunch is any indication, the amount of support staff (developers, office staff, sales people, admin) needed to run the company is at most 20%, or another ten people, particularly if they outsource a lot of that. Put everyone in the cheapest office possible, and you’re looking at additional payroll, benefits and office expenses of another $3-4 million per year.
Now lets just add another 50% on top of that for other expenses and a safety net, and round it up to $25 million per year in total expenses.
That’s $25 million/year to have a well paid staff of the best journalists on the planet. How long before they outstrip those 16 million monthly visitors and 124 million page views? 5 years? Less?
How many private equity funds would kill to put $100 million behind the NNYT to make sure the company had plenty of money until it reached profitability?
My guess is plenty. And Marc Andreeseen, who has already backed two blogs, may be the first in line to invest. And I know a couple of hedge funds that would be right there, too. I know this because they’ve pitched me on a vision not much different than this one.
Of course, none of this is going to happen. Those 50 top journalists aren’t going to be able to self select and organize themselves even if they had the inclination to do something like this. But the interesting thing is that I think something like this would work, really work, if anyone tried it. And the guys at Politico and AOL seem to be doing just that. Lean journalism, for the win.
I think Mike is probably right, in the abstract. And I think that if some of the ancillary revenue streams of the Texas Tribune work, we could actually be profitable. I still like our approach better, because of the lack of confusion between profitability and public service missions. But Mike’s suggestion should and will happen.
