Axios acquisition has big lessons for newsroom focus

By Peter Bale


New Zealand and the U.K.


The acquisition of Arlington, Virginia-based news service Axios at a rich valuation may hold important lessons for other digital news publishers, especially around their commitment to a singular focus in their output and a joined-up strategy between editorial and product.

Even more than their original creation, Politico, the founders of Axios created a news service stripped of what they deemed to be unnecessary clutter — even excluding almost all video — in favour of a rigid style of bullet points, must-read encapsulating paragraphs, extending beyond 300 words only when absolutely necessary, and always with the message to “go deeper.”

Brevity, clarity, and need-to-know information was the style of Axios, enforced and agreed with its journalists and baked into its content management system. The proposition that Axios would be clean, clear, fast, and informative was simple and effective — along with its newsroom team’s skill at getting genuine scoops on critical political and technology beats.

The market value of Axios — US$525 million — is a lesson in how “smart brevity” sells.
The market value of Axios — US$525 million — is a lesson in how “smart brevity” sells.

Seldom did Axios reporters depart from a standardised format that emphasised high up in the story, literally, “Why it matters.” It was a modern-day version of The Bloomberg Way style guide that helped propel Michael Bloomberg’s news agency to dominance over less agile rivals during the 1980s with clarity and a formulaic approach that was delivered speedily.

Now Axios founders Jim VandeHei, Mike Allen, and Roy Schwartz have turned their formula into a spectacular transaction, apparently valuing Axios at US$525 million in a deal for the privately held Atlanta-based family company Cox Enterprises to take 70% of the firm. 

VandeHei, a former Washington Post reporter, embodies many of the central elements that underpin the INMA Newsroom Initiative: editorial and product joined at the hip; clear understanding of the business model; total editorial focus on quality and a reader proposition.

I asked David Clinch, head of global partnerships at Mather Economics (and a friend of mine and solid media analyst), what he thought Axios had that made it valuable.

“I would say their secret sauce is their founders because I think Mike and Jim both had magic from Politico. But Roy brought rigidity, a focus on the business,” David said. Adding, on my prompting: “It was this approach to ‘how we’re going to do stories’ and ‘let’s build a CMS to do stories that way.’ Then everything follows from that, where you can’t really do stories any other way because you break the CMS. And there is a discipline to that. That is, you know, that is a conjoining of editorial and product.”

VandeHei told The New York Times when announcing the transaction: “The lesson of the digital era: Chase fads, fantasy, and clicks, you fade or famish. Chase a loyal audience with quality information, you can flourish.”

Inevitably, VandeHei turned a simple idea — “smart brevity” — into a TED talk, a book, and, more importantly, a news site that seems to be worth half a billion dollars and has lessons for us all.

German publisher Axel Springer bought Politico for US$1 billion late last year in a comparable transaction to draw a super-focused and efficient digital publisher into a traditional media house; they had had been in negotiations with Axios at the same time. In 2015, Alex Springer bought BusinessInsider for US$422 million, again drawing in a highly disciplined digital publisher.

Cox, along with a range of closely held media firms and investors, already had a small stake in Axios. The transaction allows Axios to keep its consulting and engineering arm — which developed its content management system — within direct ownership.

The New York Times reported Axios was selling to Cox at five times its projected annual revenue of around US$100 million. Axios HQ, the branch of the company that licenses the use of its content management system, is being spun out separately. That might echo what BuzzFeed did with its content management system related to the Rebel Mouse firm and the approach of The Washington Post even before Jeff Bezos had created its ARC platform as a service.

“I believe they’re actually going to have to be much more flexibility going forward for the format. I think the format got them here. And I think they think they can sell the format separately,” David Clinch said when we discussed the Axios formula.

Of course, it doesn’t guarantee future success, and Axios hasn’t had to solve the subscription versus advertising and events model before being acquired. But Cox has effectively bought into a vision of the media future and some tools to help it get there.

“They have convinced Cox that they are a news organisation,” David told me. “They are a news organisation, and they want to do news, and they want to do it nationally, domestically, and I am pretty sure they want to do it internationally. Cox likes that.”

If you’d like to subscribe to my bi-weekly newsletter, INMA members can do so here.

About Peter Bale

By continuing to browse or by clicking “ACCEPT,” you agree to the storing of cookies on your device to enhance your site experience. To learn more about how we use cookies, please see our privacy policy.