Forbes then and now

By Adam L. Penenberg , written on January 16, 2014

From The News Desk

When I started at shortly after it launched in early 1997, online journalism was so new that I was the only hire with online news experience -- and that consisted of four months spent at Wired News, which I joined as a contract reporter when it launched. Back then Forbes Digital Tool, as it was (unfortunately) called, was a far different site than the mammoth traffic magnet of today. We had a splash page, which consisted of some stock art that one of our designers would customize, and six sections. I was brought in as an e-commerce reporter. Then there was media, semiconductors (I think), and other sections I can't recall, except for "lifestyle," which published on weekends.

Each had a small graphical icon, which led to the lifestyle section garnering the most clicks even before it officially launched, since it was represented by a martini glass. Our offices were cramped and located four blocks up the street from the Forbes Magazine building, which was grandiose on the outside (although, I would later learn, not so much on the inside). The site was  founded by Forbes Magazine editor David Churbuck and his small, hand-picked team, and we had practically nothing to do with the magazine. Most reporters and editors from the print side wouldn't have been able to find our office, and my ID wouldn't get me into the Forbes magazine building. From their perspective, we were out of sight, out of mind.

Being an online journalist 17 years ago was a bit like being stationed in Siberia. We'd publish story after story but had no idea if anyone actually read them. There was little glory in it, and print reporters looked down their noses at us, viewing us as a marauding band of upstarts who couldn't possibly have their skills and ability. Nevertheless, we persisted, experimenting with form and structure, largely because there were no best practices at the time. Should we mimic print's inverted pyramid or adopt a more conversational and informal approach? Should we write short? Medium? Long? Should we concentrate on offering "tools" like financial calculators and de-emphasize original journalism, or go all in on providing news and analysis? Over time we evolved, but in the beginning we treated the site as one grand experiment.

Because there were so few outlets back then --, Wired News, Cnet, and a few others, but that was about it -- there was a whole world of stories and very little competition. Meanwhile, the Internet was fomenting all these delicious subcultures and changing the face of business. One week I'd write about music pirates, the next software piracy. I'd look at hackers, then Y2K survivalists preparing for the end of the world when the Millennium Bug would hit. After that I might address cybermalls or online casinos. There was almost an endless number of stories.

It was a far cry from the world of media today. Yet those of us who were there near the beginning had a sense, I think, that the Internet would change journalism forever. We had a lot of talent at the website and routinely scooped the magazine on tech stories. As a result, it became clear that certain higher ups at the magazine felt threatened. A little more than a year after I started at Forbes, our managing editor teased a reporter at the magazine about a tech story she had written -- and which we had done better. Unamused, she shared the email with Jim Michaels, the magazine's autocratic top editor, who promptly fired him.

I flashed back to all this today after coming across Ken Doctor's keen analysis of Forbes at the Nieman Journalism Lab. It's well worth the read -- Doctor sifted through the 62-page confidential document prepared by Deutsche Bank, which Forbes retained to shop the media company. You should head to the Nieman site for Doctor's comprehensive analysis of the site's advertising revenue and future projections, BrandVoice, and lots more. But the part that struck me dealt with breaking down Forbes' asking price for its properties, which was buried in the final two paragraphs:

The usual multiple for pricing magazines would be 5× or 6×. But Forbes wants a digital multiple — 10× or more — not a magazine one. Consequently, in November, we heard that ownership expected $400 million as a sales price. Now the FT has reported that the price could be between $350 million and $475 million, as the number of bidders trims from the 18 companies that took a look at the financials.

At $400 million, that would be about 26× of the $15 million 2012 earnings. Even at a more reasonable $200 million, that would be 13× earnings. If the $400 million price holds, it looks like the value of global brand potential will make up half of the price of this deal. Based on its business, it appears that Forbes is worth around $200 million, largely driven by the value of its website, not the magazine; that's viewed as an add-on, an ignominious set of circumstances. As a global brand, however, it could go for upwards of a half a billion dollars, likely to a foreign buyer.

When I toiled away in obscurity at -- I started a few months after Bill Clinton began his second term in office -- I suspected that one day the tail would wag the dog, and the dot com would become bigger and more powerful than the magazine. Who knows? I may have even projected that this would occur by 2015, which, back then, seemed a hundred years into the future.

Now that it's here, I look back nostalgically at those early days, when anything seemed possible. While I've been a critic of Forbes, which, as its traffic has exploded its brand has been diluted, I also am aware how far it's come. It probably gets more traffic -- and reaches more people -- in 10 minutes than we attracted in our first year.

But it was those of us there in the early days of Forbes Digital Tool -- David Churbuck, Michael Noer, Om Malik, and several other smart, savvy journalists -- who built the foundation for In fact, David Churbuck is the unsung hero. It was his vision.

I hope Lewis D'Vorkin and the Forbes family remember this when they sign the deal to sell Forbes.

[Image via Thinkstock]