Former CFO of The Washington Post, The Business Model Of Media (Or Lack Thereof), Planning For Patience
This week I spoke with Steve Gibson, 1987 UVA grad who was the CFO of The Washington Post and Politico.
The Rundown:
COLD OPEN: A pivot after 8 years in public accounting to running businesses
INDUSTRY INSIDER: The business model of media, or lack thereof: A brief history
STEAL THIS: Why this industry, when there are so many others?
TURNING POINT: Being a CFO even when not knowing how to be a CFO
IF I WERE YOU: A plan is great, but patience is better
COLD OPEN
How Did You Get Your Start?
I was always interested in math and science. But, when I got to UVA, really as early as 1st semester, I felt that a career in those fields wasn't suited to me.
In some respects, I took a pretty big pivot by applying to McIntire, and ended up studying Accounting there. The analytical foundations of math and science overlapped, so it was a good first step.
That was the foundation. When I was in school, the excitement around consulting didn’t really exist — you were either going to be a public accountant or an investment banker.
Given what I chose to study, I was in the first camp. The big 4 accounting firms we know today were the big 8 back then. They recruited heavily from McIntire and valued the preparation they provided candidates. I went to work for Price Waterhouse. Of the 40 of us in my training class, half a dozen were from UVA.
I loved working there, but what stood out to me was the work was always about someone else's business. I was on the audit side. What was missing for me was the ability to help shape a business directly. So after 8 years in public accounting, I left for an industry position.
It was kind of like starting over. I went to work for a small little technology startup, pre-IPO stage, for 2 ½ years. They were in the cellular telecommunications business, but they missed the strategic business window and didn't pan out to be a financial success.
There, I learned how to manage a team, build banking relationships, produce things, file taxes – all the things needed to know how to run a business. It was an invaluable education.
When it became clear the startup was winding down, I went back to my PwC network. After a couple of conversations, someone said a media company was looking for someone, and I should talk to them. So I did.
It was a private company with a group of broadcast television stations owned by the Allbritton family in Washington, D.C. I started as a controller, and moved my way up. The seminal moment for me was when our CFO, who was a commercial banker by trade, wanted to go back into banking. I had been there for 18 months, was 34 years old, probably didn't have all the right experience, but they gave me an opportunity and I took the role of CFO.
I spent the next 16 years there. I fell in love with media and the dynamic nature of the business, especially the experience to participate in the founding of Politico in 2007.
Ultimately, in a strategic exit for the family, I ran a process to sell the broadcast business in 2014. Around the same time, Jeff Bezos bought The Washington Post, and the CEO I had worked for under the Allbritton family went on to become its CEO. He asked if I’d come join him as their CFO.
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INDUSTRY INSIDER
What Do People Misunderstand About The Financials Of Media?
To this day, I believe there is truly not an established business model for quality journalism – even for companies and publications that have had success for a period of time.
While one of the most rewarding fields to be in, it is incredibly difficult. Quality journalism is expensive, and there's been a number of changes in technology, audience behavior, and consumption models over time.
For a long time, if you were able to reach a mass audience, advertising could pay for a lot. As audiences began to fragment, and media choice scaled, the advertising model could no longer support these businesses.
For example, The Post at one point received 40% of its website traffic from Facebook referrals. And then overnight, that changed. When traffic changes, the advertising model changes. As soon as that happened or Facebook decided they weren't as interested in news, our whole business was different.
The number of changes Google has made to their algorithms, and now with what AI is doing, search is completely different. You might get the answer you're looking for from Gemini and never click into any article. Maybe search is gone as we know it.
What remains constant, though, is the need for a direct relationship with your audience – it’s the key to success.
TURNING POINT
What’s A Challenge You Faced Early On?
The first challenge was realizing I wanted something different than public accounting. I had been in the industry for many years, and it was challenging to recognize my desire for a more direct part in running and managing a business. It required change and moving industries.
Second, was being named CFO for a company when I didn’t have all the experience for it.
For example, we were privately owned, but we had public debt. So when we had to do our first bond offering, I’d never done that before. I learned what I didn’t know and worked through it.
Through hard work you can make up for a lot of other shortcomings.
I would say early in a career, working through things where you're relying on instincts, you're relying on judgment, you're relying on experiences that you've had, none of which may be directly on point, will give you that foundation and confidence to go forward.
STEAL THIS
What’s A Question You Love To Be Asked (Or Asking)?
I loved being asked “Why did you consider working in media when you can work in any particular field?”
I like asking others “If capital was no constraint, what would you be thinking about?”
IF I WERE YOU
Do You Have Any Advice For Students?
Be prepared, but also be patient.
I’ve sensed that it’s important for younger colleagues to have a plan. Plans are certainly important, but the patience that’s required for them to materialize is paramount.
Allow opportunities to present themselves to you. Oftentimes some of the biggest things that can happen in somebody's career path are not things that they necessarily plan for.
When they do come, be prepared to capitalize on them.