Bauer and Burda are family-owned media companies founded more than 120 years ago as printers in Germany. Both made the inevitable journey into publishing and also became among the largest magazine groups in the UK.
But there, the similarities end.
As recently as 2016, the two German media companies each had revenue of €2.2bn. But, within eight years, Burda had grown to €2.9mn while Bauer is still at €2.2bn.
In the intervening years, Bauer had exited once-profitable magazine operations in the US and lost an estimated €350mn on the disastrous acquisition of ACP Magazines in Australia and New Zealand – at a time when the company was proclaiming its global ambitions and an undiminished confidence in the future of print. Meanwhile, Burda, whose international expansion had been largely confined to the UK and Eastern Europe, was forced to exit from once-buoyant magazine publishing in Russia and the Ukraine.
But, even with a German economy battered by its regretted dependence on Russian energy, the Munich-based Burda still achieved 2023 revenue of €2.7bn – some €500mn ahead of Bauer.
Over the past 121 years, Hubert Burda Media has grown into one of Europe’s largest and steadiest media groups.
Its real rise to prominence began in 1949 with the launch of Burda Moden, now called Burda Style, a sewing pattern magazine published in 15 languages. Burda now has one of the world’s largest databases of digital sewing patterns. Its Burda Create! is the umbrella for the company’s international crafting media with products available in 12 European markets and the US.
The company is increasingly international.
Across Germany and 17 other countries, Burda publishes more than 400 print and digital brands, including the newsweekly Focus, celebrity magazine Bunte, and local editions of Elle, Glamour and Harper’s Bazaar. For the past 20 years, its also been profitably funding digital startups across the world. Its prized, early investments include: Vinted, Bloom & Wild, Nord Security, BaubleBar Billease, Oddbox, Skillshare, NotOnTheHighStreet, Zapp, and Ninjavan.
Owner Hubert Burda multiplied his inheritance many times during 25 years of running the company. In 2010, he handed day-to-day control to its first non-family CEO, former McKinsey consultant Paul-Bernhard Kallen who is now chair of the company he had joined in 1996. He had been responsible for the expansion of international and digital business and spurred investment in what is now a portfolio of some 50 internet companies and more than €1bn revenue.
In handing over control, Hubert Burda had said: “Throughout our 26 years of working together, Paul-Bernhard Kallen and I were always of one mind, striving to lead our family enterprise with courage, unremitting optimism and creative drive so that we could hand it over in outstanding shape to the next generation. Every single day during those many years, I could be certain he would take the correct decisions – based on his entrepreneurial instinct and with this goal in mind.”
Kallen’s subsequent success is reflected in a company with a reputation for not meddling in the management of subsidiaries (with a headquarters team of just 30). The visible evidence is in Burda’s steady financials which reveal scarcely a trace of the turbulent times of the past six years for its activities across consumer media, B2B services and digital commerce:
| SnapShot Hubert Burda Media | |||||
| €bn | 2023 | 2022 | 2021 | 2020 | 2019 |
| Rev | 2.7 | 2.9 | 2.9 | 2.8 | 2.8 |
| B2C | 41% | 38% | 41% | ||
| B2B | 18% | 17% | 17% | ||
| eCom | 41% | 45% | 41% | ||
| People | 10.0k | 10.5k | 10.5k | 10.9k | 12.3k |
While profits are not disclosed, we believe that Burda has EBITDA margins of 5-7%.
Behind the relatively steady revenue is the growth of international operations. Germany now accounts for some 85% of Burda revenue. The international balance is generated by almost 25% of the 10k total headcount. In 2023, two-thirds of the international revenue was accounted for by Immediate Media, the £182mn-revenue, UK-based company acquired in 2017 for £270mn (6x EBITDA).
The price of that UK acquisition was (almost inevitably) depressed by the Radio Times. What had been the world’s first listings magazine accounted for a majority of the profit. But it may still be the UK’s most profitable magazine-centric brand. The success of Immediate, under Burda’s ownership, can be illustrated by:
- EBITDA during 2017-23 equal to the acquisition price Burda paid in 2017
- Consistent 16-18% EBITDA margins and some £20mn of annual cashflow
- Radio Times still accounts for some £70mn of multi-platform revenue (35% of the Immediate total)
- UK headcount of 750 is some 30% below 2017
- Unrivalled 1.1mn subscriptions in a UK magazine market which has traditionally been newstand-dominated
Many of the UK company’s acquisitions have also been good value.
BBC Good Food was acquired for £32mn (2x revenue) in 2018. Its estimated 130k subscriptions and a substantial worldwide free web audience makes clear the strength of this brand even without the BBC prefix which was withdrawn this year, as agreed with the vendor at the time of the acquisition. The £45mn acquisition in 2022 of Nutracheck (a calorie tracking app) is a similarly strong performer. It may now be generating £40mn revenue/ £15mn ebitda from subscriptions which are believed to have climbed to 450k from 300k in the two years since acquisition.
Even Immediate Media’s disastrous foray into home shopping TV (with total losses of some £30mn) was ‘compensated’ by the rich divestment of its wedding magazine-event interests for £40mn in 2020.
The UK success owes much to Tom Bureau who had been the company’s CEO, first under private equity ownership and, then, with Burda. In the early years of the 21st century, when magazines everywhere were being shattered by the growth of web platforms and social media, he was one of a smallish group of media bosses who combined the experience of traditional media and digital insurgency. They were the people who had a better chance of getting the balance right.
Bureau himself had seen the potential of online in the early 1990s, and co-founded Business & Technology magazine. When they sold it to the magazine mogul Felix Dennis in 1996, he and his partner cannily kept the online technology with which they then developed the Silicon B2B tech site. The Silicon Media Group had a glittering launch in 1998 among the dinosaurs at London’s Natural History Museum – intended to symbolise the death of print journalism. Yes. But, four years later, Silicon itself fell victim to the (first) dotcom collapse and to some disastrous expansion in France and Germany. In 2002, the company’s assets were sold to CNET for a small fraction of the £30mn that shareholders had invested.
Bureau bounced back as UK managing director of CNET. In five dramatic years, he steered the US-owned company from a single business information site to become the UK’s biggest online-only publisher. Its five UK web sites (CNET, GameSpot, silicon, ZDNet UK, and AtLarge) had a reach of 10mn unique users – and were highly profitable. The whole CNET international business was acquired by CBS in 2008. But not before its CEO had left to become “a digital entrepreneur”.
In 2007, he teamed up with Exponent private equity to bid for the specialist division of EMAP consumer magazines, alongside Hearst which had wanted the company’s mass market magazines. Hearst’s consolation in losing out to a Bauer knockout bid both for EMAP’s magazines and radio stations was being able to watch (relieved) the ensuing collapse in the profits of the mass market weeklies it had so wanted to acquire.
Bureau, meanwhile, became CEO of the specialist magazine-turned-digital publisher Magicalia, owned by Exponent. Then, in 2011, came the acquisition of BBC Magazines for a pro rata price some 50% less than Bauer’s eye-watering purchase of EMAP four years previously.
The former CNET boss declared that the newly-formed Immediate Media was “geared towards developing its e-commerce proposition and shifting the business away from print to a content and services platform. Retailers have been good at becoming publishers, it’s about time publishers got good at becoming retailers. We want to think more like a retailer and having the right database environment to underpin this is important. It’s about engaging our customers and developing a relationship with them, creating a rich, scaled single customer view. Our ambition is to change our centre of gravity from print towards being a content platform and services business, which means putting brands at the centre of our strategic development and looking at the business models beyond print.”
Bureau’s reward for integrating Immediate into Burda and steering it safely through turbulent economic times, was to be made chair of the UK company and CEO of the parent company’s operations outside Germany. Sean Cornwell (more digital than media) became CEO in 2023 and his predecessor turned his sights to growing Burda’s interests especially in Poland, Czech, France and South East Asia.
Poland – where Burda acquired the digital interests of Edipresse and the highly successful eCommerce platform Cocolita – has been the primary focus for an Anglo-German operating team which have been building a multilingual platform to enable the exchange of content across the world. It is easy to see how AI will add power to these strategies to re-purpose content. In many ways, it is the logical sequel to the once so-profitable international licensing of magazine editions which was wrecked by the web.
Bureau is also chair of the €300mn-revenue (30% EBITDA margin) New Work recruitment and professional networking platform which de-listed from the Frankfurt stock exchange this year. We might assume that the 18-year-old business with 21mn members will have ambitions to expand beyond Germany, Spain and Portugal under 100% Burda ownership. Could it become a real competitor with LinkedIn, Glassdoor and others across the world?
Burda is the story of a quietly ambitious media company which has made its earlier investment mistakes (printing operations in India and Africa, for example). But its comprehensive performance contrasts with its Hamburg-based rivals.
Bauer is famous for its micro-management – and also for the way that its whole executive team has regularly changed ever since Yvonne Bauer succeeded her father in 2010. She took over two years before she led the gung-ho plunge into Australia. The fiasco cost some of her longterm executives their jobs. Bauer’s whole top team has changed again recently, with the departure of former COO and longtime UK CEO Paul Keenan. Among other things, he led the growth of the radio-audio group that has become Bauer’s largest (and most international) business.
Who knows what comes next for Bauer and its revolving door of executives?
But, for the settled management of Burda, we might expect yet faster international growth. Its content platform for use across all Burda and all languages may already be starting to pay dividends. But it might also become the route by which the German media group could build multinational alliances and JVs with increasing numbers of operators around the world. It really could become the ‘new” digital licensing business to replace those hundreds of international editions of global magazines once published by local partners.
Is this just the start of a new, very global Burda Media Group?
