Mar 1, 2022 - Economy

Scoop: Inside the Smiths' hunt for cash

Photo illustration of Ben Smith and Justin Smith sitting at a table with a laptop and with U.S. quarters falling in the background.

Photo Illustration: Annelise Capossela. Photos: Aniruddha Chowdhury/Mint, Drew Angerer/Getty Images

Justin Smith, the former head of Bloomberg Media, and Ben Smith, the former New York Times media columnist, have approached some of the biggest names in media in an effort to raise $20-30 million to launch a news organization by fall of 2022, according to people they've pitched.

Why it matters: The Smiths, who tell investors they'll burn through $50 million in cash before breaking even, have approached Bob Iger, Michael Bloomberg and Laurene Powell Jobs' Emerson Collective, sources tell Axios.

Details: The Carlyle Group's David Rubenstein, often mentioned as a potential investor, is seriously looking at it but has yet to decide, per a source familiar with his thinking.

  • The Smiths have told several people they've discussed the project with that they're trying to avoid raising cash from Silicon Valley venture funds, and have instead targeted mostly wealthy individuals and family offices.
  • The pair has decided on a name for the company, which for now they're calling "Project Coda."

Ben Smith is telling people he plans to go all-in on the 2024 presidential campaign, in keeping with his theory — which he proved as an early personality at Politico and as editor-in-chief of BuzzFeed news — that political scoops are the way to build buzz and a brand.

  • He's planning a 2024 newsletter, hoping to ride public interest in the campaign, much like Politico did in the run-up to the 2008 race.
  • The company will prioritize other editorial verticals depending on the talent they hire.

Ben Smith has said New York Times scoop machine Maggie Haberman is the best reporter in the country and he'd love to hire her. Haberman declined to comment.

  • He and Justin Smith are also actively recruiting people for non-editorial roles, like product.

What they're saying: At investor pitches, the Smiths toss around terms like elite audience and disruption a lot, and say they'll hire superstar reporters who eventually could attract subscriptions.

Between the lines: The model — and pitch — sounds to some investors like Puck but with global ambitions.

  • Two people who were asked to invest said the Smiths' plan is too vague to throw money at right now.
  • The Smiths contend they'll need to raise $80-100 million in coming years to spread across different regions around the world.
  • Justin Smith talks up creating an internal talent management arm to help elevate the brands of the company's top reporters.
  • Ben Smith has said in the past that the "talent model for journalism is pretty broken," which can be a challenge for big institutions.

Catch up quick: The Smiths announced last month their ambitious plan to launch a global newsroom targeted to the 200 million members of an "English-speaking, college-educated, professional class" around the world. The business model will include subscriptions, advertising and events, they said.

  • They plan to host a signature event in 2023 with sponsors, sources say.

The big picture: The Smiths' company is entering a hyper-competitive race for top-tier talent that includes Bloomberg, the Times, the Washington Post, Politico, Axios, Substack, Puck and many others.

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