The Athletic keeps growing .......

They are not are averaging $70 a year on their subs. That is a lot of money for most people, on top of their Netflix subscription or Amazon Prime, etc. subscription, which I'd guess offers a better value proposition in most people's minds (and we are in an environment in which consumers are actually cutting a lot of non-essential things back).

Also, they have been offering discounted subscriptions -- you can get their subs for $36 a year. On top of it, they are advertising quite a bit. For example, every time you see one of their ads on Facebook or Instagram. So you'd need to know what the cost of acquiring each subscription is. Then, a key is going to be what percentage of people who try it, re-subscribe. I have seen quotes from Hansmann and Mather saying they are seeing killer re-subscription rates. If that is true, it will be the key to their success. If they get people resubscribing easily, and at little cost, it will make them. If they don't, it will break them. If they have to keep spending to get resubscribers or new subscribers. ... well, that is what killed many a print magazine. In the advertising model of magazines of yesteryear, they often spent more to acquire and keep a subscription than they made on the subscription revenue. It's a really tough game to play, in general. Not impossible if you have the right content, but tough.

The funding they have raised will certainly give them enough runway to figure out if this works. And their cost structure might be more favorable than print / mail was. They don't share enough info publicly to know how things are looking yet. If I was considering investing in this, aside from the valuation. ... I'd be keyed in entirely on the cash flow, and if cash flow hasn't ramped up much yet, then what the burn rate is on that cash they have raised. Even if ridiculously loose credit conditions (which have started to turn) allow them to keep raising money to burn through, for most things you honestly can tell relatively quickly if something potentially viable is there by simply watching the cash flow. It's like anything else -- if you are making sales, it means there are people buying what you are selling. If you're not, or if your costs outweigh those sales, you're probably wasting someone's money and you'll bleed to death.

One other thing. There have been people on here (but you never know what axe people on an anonymous message board have to grind) implying that at least some of the roster of talent they are putting together may include people unhappy (or could become unhappy) with their level of compensation. I have no idea what is true, but it would certainly be something worth watching. On the one hand, their idea seems to have hinged on the fact that there are a lot of talented people out there who have been laid off or are working for publications that are struggling. It has given them an amazing talent pool to pick, and probably at a relatively low cost. But if that ends up being a difficult tight rope to walk, it could be a problem. They are selling something. If there is a market for it, the quality of the product probably matters a lot. And obviously, their talent is the key to that quality. ... That solves itself, if their business is successful and they bring in lots of income that allows them to keep everyone happy.