I first started writing about Quartz in 2012, shortly after it was founded as a spinoff project by The Atlantic. Earlier this month, Zach Seward, one of the founders and the executive with the most enduring connection to the brand, wrote what was, effectively, an obituary for the business-focused, digital news startup.
In a post titled “What was Quartz?” Seward said that G/O Media boss Jim Spanfeller’s decision to fire the outlet’s remaining staff and sell “the carcass to a Canadian firm that appears mostly interested in the email list” should not have come as a surprise, given the fate of other media brands under G/O. Spanfeller has hit back, claiming Quartz was in a “dire” state when he bought it for less than $10mn in 2022 from Seward, who had taken over in a buyout with fellow investors two years earlier. He claimed that metrics under G/O had been going in the right direction and the brand’s future was “extremely bright”.
But what”s beyond dispute is that Quartz now has its fourth ownership change in seven years. Atlantic had sold it in 2018 to Japanese news and data business Uzabase for an estimated $100mn. Quartz’s management bought it back in 2020 and, two years later, they sold to the pe-owned G/O Media (ex Gizmodo Media) for under $10mn. Now it’s owned by Redbrick which, according to Axios, sees Quartz as “part of an effort to scale publishing sites using tech from its other portfolio companies, a similar model to that used by Recurrent Ventures, and The Arena Group.” Redbrick will also integrate it with Paved, a newsletter advertising platform it acquired last month, in order to leverage its (unpaid) 1mn+ subscriptions.
While it’s difficult to unpick the exact performance since G/O bought it, it’s hard to see the latest sale to a company planning to integrate it with its own newsletter advertising platform as anything but the final chapter for what was once seen as an innovative trailblazer.
Watching Quartz’s fall both makes me feel very old (turning 40 isn’t helping) and strikes me as something of a full stop on the era of digital-native news brands that flared brightly and briefly in the 2010s. Quartz was both very different to its peers such as BuzzFeed and Vice, and in the end sunk by quite similar forces.
Though official revenue figures are hard to come by, putting together various reports gives a clear picture of how things panned out:
There was that peak in 2018, at which time Quartz had grown to 250 people. That was when The Atlantic managed to sell the business to Canadian firm Uzabase for $86mn in a deal valuing Quartz at $110mn.
But as Seward also points out, Quartz never made money (other reports have suggested it was briefly profitable in 2016, and Spanfeller claims it has been profitable under G/O) and lost $40mn as it grew in those first few years. Losses reportedly continued after 2018, coming in at $18.6mn in 2019, $18m in 2020 and a lower but still pretty major $6.9mn deficit in 2021.
Financially, Quartz never lived up to the promise of being an aspiring competitor to the Financial Times, Wall Street Journal and The Economist. Indeed, it never came close to the revenues or valuations even of its digital news brand peers such as BuzzFeed or Vice.
It’s worth looking back, however, at some of the Quartz innovations that have stuck around and worked, as well as the missteps, many shared with its peers.
One of the most enduring legacies of Quartz, which is easily forgotten, is that it was one of the first digital media businesses to go all-in on email newsletters. I remember the Quartz Daily Brief being the envy of other media brands, boasting a 50% open rate and big brand sponsorship deals. It inspired plenty of other businesses to put effort and resources into what was then a rarely considered channel. Now, the email inbox is seen as one of the most valuable ways to build lasting relationships, particularly with the decline of the social traffic that, ironically, drove the bigger digital boom of which Quartz had been part.
Another key, and related, point that is easily forgotten is that Quartz started out as “mobile first”, something that, at the time, was also seen as revolutionary. It was also an early adopter of infinite scroll, another feature that has become incredibly widespread.
In so many small but significant ways, Quartz was an unrewarded pioneer. But looking at the lessons of what didn’t work is perhaps simpler because so many of them were shared across its peer group.
Like BuzzFeed and Vice, Quartz was a pioneer in native advertising. The bespoke content was a response to the commodification of display advertising which commanded, for a brief period, much higher rates than simple ad slots – even if they lacked user targeting. What Quartz and the rest learned quite rapidly, however, was that native ads were expensive to produce and, more importantly, didn’t scale. Arguably, influencer marketing is the true inheritor of the principles of authenticity and brand alignment native ads tried to tap, but one that is both far cheaper to produce and easier to get in front of large audiences on the platforms, rather than the publications, it is native to.
Another key area where Quartz seemed to be a clever innovator was the deprioritization of the homepage. While it wasn’t quite as geared up to surf the social wave as BuzzFeed, the move again seemed to make sense in the new platform world (and one that was encouraged by the infamous leaked New York Times report basically predicting the end of the homepage as a major audience destination). What many media organisations have discovered, however, is that the homepage remains the key bit of real estate for loyal readers and the one audience channel you can really control.
Quartz’s trailblazing also didn’t quite pan out when it came to bets on India and Africa. The Indian operation seemed to thrive initially, and the Africa focus seemed to make sense at the time, particularly from the perspective of a business publication. A relatively underserved media market on a continent with the most unrealised potential for an economic boom. But while it won plaudits for its coverage and, in particular, for employing local reporters and taking the continent more seriously than most others, it never quite lived up to its promise. While the localised teams persevered into the 2020s, they were eventually cut as the organisation downsized.
Semafor has publicly made a similar bet with a similar sounding premise and even the same editor that ran Quartz Africa. It has, however, announced very little since doing so and – while it may yet pay off – if it doesn’t it may be time for a deeper rethink about whether Western-founded outlets can really serve an African audience effectively enough to build a business.
<However, Semafor’s twin strengths versus Quartz may be more obvious reasons for the success of its business model: 1) It is largely funded by an impressive events program and 2) It is a relatively low-cost operation. Beyond all else, Semafor is, well, good at business.>
For Quartz, one failed experiment did differ significantly from its peers – the launch in 2019 of a metered paywall following the Uzabase acquisition. It eventually racked up 25,000 members, but was scrapped in 2022 under Seward. The company had said it hoped that many would stick around, after finding that many of them didn’t pay for exclusive content. There are plenty of reasons why consumer revenue wasn’t the solution for Quartz, but I think a key takeaway is that it is incredibly hard to build a paying user base on a business geared up to give away content. The Guardian, of course, is generating significant revenue from its membership programme, but it’s still a long way from being the dominant source of income. A key test here will be whether the UK-based Tortoise Media can make people pay for access to The Guardian’s own former Sunday brand The Observer, which relaunches in print and online this weekend.
In the end, the biggest lesson from the rise and fall of Quartz is that building a news media business is hard. Quartz had clever distribution, high-quality content and innovative commercial solutions, and its approach was arguably cleverer and more innovative than those of its peers. It also didn’t expand at anything like the same rate as those backed prodigiously by VC-money and big investments. And yet, 13 years later, it’s joined the list of once great hopes for the media business that have slid into irrelevance and, in Seward’s words can now be “laid to rest”.
Seward, incidentally, is now editorial director of artificial-intelligence initiatives at the New York Times, a job that once again puts him at the cutting edge of media. Whether that area of expertise leads to another, more sustainable, growth era for journalism, or a more devastating crash, is going to be the big question for the 2020s. Of course.
