The Athletic keeps growing .......

Don’t you people get it? Investors don’t care about profit anymore. They care about growth, and their likelihood of being a monopoly 10-15 years down the road. That’s why Spotify and Uber can operate at a year loss of billions of dollars

 

Or all the VC money goes away and The Athletic goes tits up.

 

For such a smart bunch of people, SJ folks sure have no clue how the digital media economy operates.

500K paid subscribers is a gold mine.

 

500K at a $60 a year subscription is $30 million in revenues. The Athletic has started podcasts but I don't think they become particularly popular. Given the number of people they employee, the high salaries of some of them and other costs I think they need a lot more than 500K subscribers to break even. What revenue streams am I missing in their current business model?

 

The Athletic says it covers 270 pro and college teams. Now, some of that coverage is from freelancers, but considering there are 124 pro sports teams in the Big 4, about 40 colleges with full-time writers, and a mix of national writers, special projects writers, columnists, editors, marketing people, IT folks, and more, it's probably safe to estimate the Athletic full-time employee count as around 325-350. And that might be high.

Even at the high end of 350 people who are taking home an average salary/benefits package worth $75,000 per per year, you'd be spending just $26.25 million. So your revenue is completely covering your payroll already, leaving the rest of the revenue for marketing (which has been largely social media based) and HQ office space.

I don't know if the Athletic is fully in the black once it all adds up, but I can easily see how it's close and enticing to the next round of investors.

 

I have no idea but how much would it cost to run the IT network.servers, staff.etc to host a site that big. And you ignore travel.

But do they have 500,000 subscribers? Do the subscribers pay $60 a year. If they do then I think they probably will make even if they are losing money now. But I have no idea how many subscribers they actually have.

 

Tough to get a truly accurate count since it's a private company, so we only have their word. But I can believe they have 500k subscribers nationwide. I remember hearing that some big Rivals/247 sites have thousands of subscribers, and those are pretty niche.

The toughest thing is head count and who is a staffer, who is a contractor. The point with my estimates was to show you can pay a huge staff a reasonable salary and still have payroll completely covered. Yes, there are other expenses, but it all seems to add up to me.

The next questions are about sustainability, whether there is such a thing as too big, retention, and much more. The Athletic is far from being out of the woods, but I can certainly see outside investors believing it's on pretty star footing.

 

Do you have a source on the number of subscribers? That is really what is material.

 

Source: Bloomberg

 

Thanks.

If the figures are true, and I have no reason to believe they are not, then the Athletic is well on its way to success. They have added 200,000 subscribers this year. If they reach a million or something close to it by year end they certainly will be positive cash flow.

 

It still amazes me that people are paying $10 a month when they could be paying $30 a year. I know, subscription culture, but still. The discount codes aren’t as prevalent as they were when every big name sportswriter was tweeting them out, but they’re easy enough to find. Also: Do their podcasts have advertising? Their video and text-based content doesn’t.