Vice Media's co-founder and CEO says as the aging TV networks fade, "we are going to eat their lunch."
Vice Media is no longer the hipster debutante to the New York media scene. Its flagship magazine is nearly 20 years old, and has, despite its raw, unconventional, and sometimes obscene approach to storytelling, become a stable flagship for the larger Vice brand.
"It's a flier to the brand," says Vice Media CEO Shane Smith, noting that the print magazine, though it's no longer growing rapidly, helps the company attract top-tier photographers and videographers to the broader company. And that's helped Vice Media, which is based in Brooklyn, New York, vie not just to be the next MTV, but rather to be bigger than the largest cable-news outlets in the United States. Yes, CNN, Vice is comin' at you.
"It's either going to be us or it's going to be Buzzfeed or someone else," Smith told David Rowan, the editor of Wired UK, on stage at the f.ounders conference in Dublin. "But we are going to eat their lunch."
Beating the Odds
That's an audacious claim at a time when advertising revenue across most print has shriveled and online publications are groping around in search of sustainable strategies for pricing and adding native advertising or marketing layers to content. But audacity is the status quo for Smith, the burly, tattooed co-founder of Vice, a publication that's come a long way since its early days in Montreal. (Smith and his co-founders built their magazine on the chassis of the government-funded Voice of Montreal; they got the new name by dropping the "o.") Smith has become the camera-ready ambassador of the Vice brand, as well as an advocate for Gen Y--the Vice audience, which Smith says does "not care about mainstream media in any of its facets." Vice's unorthodox editorial projects have included traveling to North Korea with Denis Rodman, filming correspondents' drug use, and embedding with Mormons to explore Mexican thuggery. David Carr explained the media brand's transformation eloquently in 2010:
The magazine, created by welfare scammers in 1994 in Montreal before moving to New York in 1999, started as a thinking man's lad magazine--the co-founder Suroosh Alvi once said that Vice did "stupid in a smart way, and smart in a stupid way." Since then, it has gradually morphed into a global brand that confers status and cool on anyone associated with it.
"We have been doing business with those guys for a couple of years," said Michael Tatelman, vice president for sales and marketing at Dell. Vice came up with a twist on custom publishing called Motherboard, a tech and culture site that relies on branding as opposed to banner ads. "As we look at outreach to Gen X and Gen Y, they have managed to build out a brand that is more than a fad, one that authentically connects with a young audience that is steeped in technology."
The economic downturn has been brutal for almost all media companies, but Mr. Alvi argues that it has been good for Vice'’s ad business. “If everything was going along tickety-boo, the big companies would still be giving all their money to the agencies. As it is, we can bypass agencies with subversive ideas and content, and sort of be the last man standing."
Rapid growth in consumption of the company's online video--and in the willingness of sponsors to pay for access to those viewers--is one reason Smith is so wildly optimistic about the brand's future growth. He says that while it took Vice magazine 10 years to reach one million subscribers, it took the brand's website only one year to reach 10 million unique views per month. "We are very glad we were the first one there with online video," he says. "It reinvigorated what we did as a content company and brought us global."
Smith, a 42-year-old father who retains part ownership of Vice Media, spends half his time running the company and the other half as a correspondent for Vice. He told the audience in Dublin, which was largely composed of tech company founders, that he's found passion for your field is a big indicator of success.
"If you're gonna make couches, you better love couches," he says. "If you're going to make media, you better love media."
He continued the thought, getting in a jab at serial entrepreneurs who crack into incongruous industries: "I don't understand how these CEOs go from company to company, like 'now I'm making yogurt, now I'm making cars, now I'm doing pogo sticks!'"
Lately, Vice is expanding its areas of media coverage; having branched into criticism and television, it is now experimenting with live news. Smith says the surest sign of the company's growing clout is the tone in which it is discussed by more-convential media companies: "Every time mainstream media says we suck, we get 10 million more followers," he said. "So, keep it up."
Smith sees criticism as a sign he's getting closer to competing with the likes of CNN. "We had 17 years of praise, and over the last three years, people started to come after us," he said. "I always heard, 'when you're everyone's kid brother, everyone loves you. But once you start to eat their lunch, they'll piss in your eye.'"
Rowan asked Smith to discuss revenue, and the two settled on an unconfirmed and likely very rough figure of $200 million. When Rowan asked whether that number was revenue or profits, Smith chuckled and said: "If it was profit, I'd be on an island wearing a giant golden hat."