For traditional print media the 2007 recession,
combined with pre-existing industry conditions, was a perfect storm.
Reporters, journalists, and editors faced uncertainty and job loss.
the web log, or blog, was becoming the new foot soldier in the world's frontline fight for
information and news, despite the fact that most blogging was done for free in the absence of a
clear working business model.
In the midst of this firestorm, Nick Denton's Gawker Media, home to dozens of websites like
Gawker, Gizmo, and the now absorbed celebrity Defamer, scrambled to figure out how to not
just stay afloat, but to actually achieve serious growth.
His core strategy was shedding excess staff, retaining the most talented team and cherry picking
some newly available talent from other online sources of great writers.
You know, we saw how something which starts with a moderate correction can become a
traumatic downturn, and it kills a lot of businesses.
And so we reacted very rapidly to the first signs of trouble in 2008.
And you could argue that we overreacted.
With the main revenue source of such websites being advertising, Gawker made sure that the
staff they employed earned as much cash as was feasible.
Rather than laying off significant numbers, Gawker sold the few underperforming sites.
That reduced payroll and increased capital at the expense of closing a few market channels.
We were planning very much for the worst, and the worst did happen for some sectors...for
some companies in the media environment. But not for us. So rather than those cost cutting
measures being required for survival, which is what we thought, they ended up being measures
that gave us perfect margings that we hadn't previously experienced.
Thus, and somewhat ironically, Gawker found itself laying off some personnel while
simultaneously hiring for it's better perfoming core brands.
Starting probably in about 2006 we started to as we bulked uo the advertising sales, that we
started to feel that too much of our energy had been devoted to size, which maybe weren't going
to make it and maybe would be a little bit too casual in the size that launched.
And so very well before the downturn we began rationalizing, so for every site that we would
close or console or sale another site.
Unfortunately I think we've developed enough reputation of investing in our winners and
shuttering, or reducing, our bets on our losers.
We developed enough of a reputation for that, and that is seen as the end of the normal course of
business.
Gawker's aggressive reputation for big media skills with an upstart rebelliousness has attracted
talent as edgy as it's review and criticisms.
Gawker doesn't own a job site, but they're well placed to attract web savvy talent to other online
services.
One of the most attractive elements of the web is the interaction with readers.
a surprising number of those readers also have rising potential.
Whats one of the best sources of talent that we found is actually int the comments themselves of
the Gawker sites.
Ryan Tate and Richard Lawson of Gawker.com, and both were discovered through the
comments.
For somebody to hae commented and show interest in the subject matter of the site, it shows
ability to master the coloring of the site.
It shows a willingness to interact, which a lot of traditional writers from newspapers don't have.
And so some of our most successful hires have come from that environment.
It provides us with a farm team of talent that we cant tap.
To weather a perfet storm, sometimes you cut ballasts and sometimes you batten the hatches.
I think we've probably gone too far in that direction.
We've become a little bit too conscious of the costs, and the short term commercial viability of
each site.
