Six years ago, The Athletic came out swinging. Its mission, infamously, was to bleed local newspapers dry en route to building a behemoth sports media company that would untether sports news from advertising, thereby changing the way sports news was reported, presented, and consumed.
“We will wait out every local paper out and let them continuously bleed until we are the last ones standing,” Alex Mather, a co-founder of The Athletic, told The New York Times in 2017. “We will suck them dry of their best talent at every moment. We will make business extremely difficult for them.”
If The Athletic was not the paradigm-shifting innovation to sports reporting it promised to be, and it wasn’t, it has been very successful in bleeding out erstwhile competitors. The company has poached hundreds of staffers from dozens of local newspapers and other sports media companies, and its staff has grown to more than 400 reporters and writers across the globe. Funded from the very beginning by hundreds of millions of dollars in venture capital money, The Athletic never needed to be profitable (in 2018, The Athletic said it was profitable; in the beginning of 2020, it said it expected to be profitable in 2020; it was reported that the company lost $95 million in 2019 and 2020; now The Athletic says it expects to be profitable in 2023), it just needed to maintain the promise of future profitability in order to keep investors on the hook while a buyer was found. This is exactly what happened, and now The New York Times is set to buy the company for $550 million (a definite discount from its previous $800 million valuation, but a win nonetheless for the founders and investors who now get to cash out).
It’s unclear if and how it will be a win for the people who actually make The Athletic, largely because they’re being told little about how their future will look. Though the news of the sale broke yesterday morning, there was only radio silence from Mather and his co-founder, Adam Hansmann, until midafternoon, when Mather posted a press release memo about the deal in the company’s “announcements” Slack channel. The memo emphasized that The Athletic will operate “as a standalone editorial unit, separate from the newsroom of The New York Times.” This point was emphasized again in an all-hands meeting held yesterday evening, a recording of which was obtained by Defector. Both Mather and Hansmann, as well at NYT execs David Perpich and Meredith Kopit Levien, assured everyone that the sale means the future is bright for all. They took no questions from staffers.
“It's going to be business as usual this year as we kind of get up to speed,” Perpich said. “But I will be working with Alex and Adam, to figure out ways that the times can help you do all of the work that you do in all of the ways that you might be excited about working with The New York Times Company.”
Some staffers wondered about what “this year” might portend for the longer-term future. Will there be layoffs at that point? Is now the time to work together to ensure staffers will have protections in the event of a restructuring? After all, if there is an eventual integration that creates redundancies between The Athletic and The New York Times, the staffers on the Times side of the equation have a union contract providing certain guarantees.
“No one knows anything,” a staffer told Defector.
In the all-hands, Levien said the Times was going to support The Athletic’s growth: “We are acquiring The Athletic with the intention of investing in it, and really growing it, we want to continue this amazing thing that you have started.”
Specifics about what that investment might look like were hard to come by, though Perpich took a stab at offering some concrete ideas.
So it’s my job to work with Alex and Adam and other senior leaders at The New York Times to figure out, How can The New York Times help The Athletic. You know, you may be thinking like, What are those things? I've had a chance to share some of this obviously with Alex and Adam, but even others, you can imagine kind of expertise, tools, capabilities around data visualization in our coverage, how we can do even better in the live moment in winning the search, how we optimize the subscription funnel, how we could leverage what The New York Times is doing around DEI to augment your plans.”
Other staffers had questions about their stock options, which were not addressed at all. There was also the general issue of staffers, many of whom were sold on joining The Athletic with promises of being part of building something new, being kept in the dark and not being able to have any of their questions answered. Perpich addressed the one-sided communication in his address to staffers.
“Today we signed but there's a period before we close which will happen in Q1 and so in between that time, we're a little bit more limited in terms of what we can say,” he said. “But after that moment, we'll have an ongoing and open process of communication together and I’m really excited about that.”
In the meantime, staffers were invited yesterday by The Athletic's chief content officer Paul Fichtenbaum to put their questions in a Google form, which he said the bosses will “work to address in a timely manner.”
