Caught in the mushy middle: How Quartz fell to earth

Caught in the mushy middle: How Quartz fell to earth

Caught in the mushy middle: How Quartz fell to earth
    The Atlantic wanted to corner a more premium space, selling marquee advertisers on a

new generation of yacht owners and Rolex wearers. A free and digital Economist for the

budding millennial business elite. The concept oozed an Obama-era ethos of global

interconnectivity. “When you walk through a busy Asian airport, nobody is talking about or

thinking about the American economy. The world has gotten much bigger than that,” David

Bradley, then the owner of the Atlantic magazine, told the New York Times upon the launch

of Quartz. Under the leadership of editor-in-

chief Kevin Delaney, a former Wall Street Journal editor, and publisher Jay Lauf, formerly

of the Atlantic, the project began with a staff of 20 journalists and four premium sponsors

— Boeing, Cadillac, Chevron and Credit Suisse. 
    Staffers from the early years say that Quartz calacatta luxury was marked by a culture of experimentation

and innovation codified by an internal buzzword — “quartziness” — a nebulous term

loosely defined as the meeting of creativity, quirkiness and intelligence.
    In August 2013, when Steve Ballmer stepped down from Microsoft, Quartz’s headline

highlighted the CEO’s personal windfall from the surging stock: “Steve Ballmer just made

$625 million by firing himself.” The clever take helped Quartz’s version of the story

rise above the rest in the early days of headlines engineered for the social web, where

hundreds of thousands of pageviews, if not millions, hinged on framing. “That was a very

archetypal way we responded to breaking news,” said Gideon Lichfield, then an editor at

Quartz and now the editor-in-chief of MIT Technology Review. “We talked a lot in those

days about ‘quartziness.’ To figure out the unexpected take or angle on something and

write that.”
    A Quartz style guide from the time encouraged reporters to “write at the intersection

of the important and the interesting” and to “think social.” Stories should fall on the

“Quartz curve,” meaning either short (less than 500 words) or long (more than 800 words),

but not in the middle, a rejection of the typical length of a newspaper story in the

mobile-reader ecosystem. The newsroom eschewed “desks” or “beats” and organized around

“obsessions.” Africa’s economy is a beat, according to the style guide, but Chinese

investment in Africa is an obsession — a phenomenon shaping readers’ lives and

industries. “Obsessions” shift, while beats remain constant, in theory making Quartz’s

newsroom more agile but in practice also permitting reporters to be more scattered.
    Quartz quickly gained a reputation among media navel-gazers as one of the most

forward-thinking newsrooms on the “future of news.” The company was regularly lauded

across the trade press, including by Digiday, for experimenting with technology in ways

both useful (compelling visual ads) and charming (a light in the newsroom letting staffers

know when it was going to rain). 
    Before data-related editorial roles became industry standard,

Quartz carrara melded the

product into the newsroom, primarily through its “Things” team led by Seward. A

combination journalism and coding squad, Things introduced a tool that allowed reporters to

quickly publish their own crude charts. In traditional newsrooms at the time, placing a

graphic into a story could be a time-intensive group endeavor. Given that a headline

promising “one chart perfectly explaining” a certain topic was then a reliable traffic-

generating trope, the tool allowed Quartz reporters to be more nimble and independent.

Visuals and interactives spread across the industry, and Quartz helped set the standard for

what digital business journalism could look like. In short order, the company was

generating praise and awards.
    “One of the great things that Quartz did was really inspire newsroom leaders around

the world to see news as a product and not just a chunk of text,” said Dan Frommer, a

Quartz editor from 2014 to 2016 who now writes a newsletter called The New Consumer. “The

fact that not only was everyone was allowed to — but was responsible for — their own

charts led to a data and math literacy that a lot of places don’t encourage or mandate.”
    As Quartz’s profile grew, so did its traffic. Less than a year after launching, Quartz

hit 2 million unique visitors and surpassed the Economist, a moment seen at the time as a

changing of the guard. It signed on more advertisers like Ralph Lauren, KPMG and Rolex.
    Over the next few years, the Facebook referral gods delivered Quartz and a horde of

other outlets booming traffic. The company expanded into new markets like India and Africa.

By late 2015, it had a staff of 60 on the editorial side writing 50 to 60 pieces of content

a day and was pulling in about 15 million monthly unique visitors. It dove into video and

by March 2016, amid the video explosion on Facebook, reached 200 million views across

platforms, the kind of milestone touted at the time by media executives who would later

come to learn the fickle nature of Facebook video views. 
    Competitors for ad dollars saw Quartz as a model publisher. “When I was running Slate,

I looked at them with admiration,” said Keith Hernandez, that site’s former president.

For the first two years of the business, Quartz rarely made concessions on price, scoring

CPMs of about $75, according to people familiar with the matter. Its in-house sponsored

content unit worked with big brands to fashion custom, sharp-looking (and less intrusive)

native and banner ads, rebuking IAB standard display ad units. When Quartz opened up its

chart building tool to the public, GE was the founding sponsor. 
    The quality-over-quantity advertising mantra worked and Quartz’s prosperity reassured

small and medium-sized newcomers that it was possible to score blue-chip clients with deep

pockets. “There was a realization that the growth on Facebook was not going to be

infinite, and that there might be a place for the middle class of publishing if you can

create beautiful ads,” Hernandez said.
    Lost focus
    Quartz celebrated its fifth birthday in September 2017 amid a wave of optimism.

“Quartz now reaches more than 100 million of you every month across various platforms.

Just last month, our website had 22 million unique visitors,” Delaney wrote in a memo

laying out the plans for the future. More expansion was on the horizon. There would be

Quartzy, a new vertical expanding life and culture coverage, as well as Quartz At Work, to

cover management and the workplace. An afternoon component was to be added to Quartz’s

popular Morning Brief email. More video series would debut across Facebook, YouTube and

Quartz’s site.
    Meanwhile, the ownership structure at Quartz’s parent company had changed. A few

months earlier, David Bradley, the owner of Atlantic Media, sold a majority stake in the

Atlantic magazine to Laurene Powell Jobs, the widow of Apple founder Steve Jobs. Quartz

remained under the Atlantic Media umbrella, but Bradley made clear to those around him that

the next generation of his family had no interest in becoming media barons. Speculation

swirled that Quartz, an albatross around Bradley’s neck, was also for sale.
    Market forces were also starting to shift. Facebook, humbled by the press for its

central role in the spread of misinformation, changed its News Feed algorithm in January

2018 to emphasize user content over publishers’. News companies coasting on the traffic

bonanza saw their audience drop. Quartz, for its part, had experienced this kind of

whiplash before. In the early days, the site picked up hefty referral numbers from LinkedIn

only to have that evaporate when the platform pivoted to hawking its own content. Before

the Facebook algorithm change, but especially after, publishers including

quartz other marble copy

renewed their interest in search optimization to diversify their referral sources.

For legacy sites, returning in part to a Google-driven model was familiar. That’s how it

was done before the Facebook gold rush (remember “What Time Is The Super Bowl?”). But

Quartz had missed much of that era of media.
    “There was definitely a point where the shift in our referral traffic left us not

entirely sure what the levers were,” said Kira Bindrim, Quartz’s executive editor.
    A slow contracting began on the business side. Native advertising became increasingly

competitive. Every publisher across the industry operated their own custom ad shop.

Campaigns at Quartz, one former business staffer said, needed extensive paid budgets to

ensure traffic. “For a brand, getting some award because of a nice looking campaign — the

value of that has diminished,” said the former staffer. “Brands aren’t willing to pay

for that thing if it’s not really benefiting their business beyond sentiment. These were

very expensive campaigns.”
    Quartz’s ad work is high-touch, custom and by its nature difficult to scale. “The

composition of our advertising is still tried-and-true display units and content work. But

we have over the years adopted more standard ad units,” said Katie Weber, Quartz’s

current president who has been with the company since 2014. The site, for instance, now

offers a 300 x 600 mobile IAB unit, something that it did not a few years ago. The move

echoes other native digital publishers, like BuzzFeed, who were automated ad holdouts until

about two years ago.
    Hernandez, formerly on the advertising side at BuzzFeed and Slate, said Quartz pushed

the advertising envelope, but that it struggled to clearly define where it sat in the

market. “Who were their competitors? Is it the Atlantic or Business Insider or are they up

against the WSJ or FT? The answer was kind of ‘yes,’ so they became a smaller piece of

the pie.” Brands today “love creative and the brand purpose, but at the end of the day

they’re going to spend their money on things that work, and the things that work are

Facebook and Google.” 
    The move to subs
    In July 2018, Quartz announced that it had been acquired by Uzabase for a price between

$75 million and $110 million, based on future performance (final sale price: $86 million).

Uzabase had reached out to Quartz for a content partnership, and the talks turned into a

full-scale acquisition. It was a coup for Bradley. Sources with knowledge of the company

estimated that he was able to basically break even. 
    Staffers were stunned by the acquisition. Few had ever heard of Uzabase, which owns the

Japanese subscription service NewsPicks. “In Japan, people were really willing to pay for

the NewsPicks experience, and there are so many different alternatives in this market,”

said a former business side employee at Quartz. “Japanese culture has a different

relationship with media and less competition. I could just never see it taking off in the

U.S.”
    In late 2018, quartz pure

color unveiled a paid membership offering — $14.99 a month or $99 a year —

promising more content and events for Quartz devotees. Six months later it put in place a

metered paywall. “The major change following the acquisition by Uzabase was to focus on

building the subscription business,” Seward said. “There’s no doubt that having

diversified revenue streams is critically important for us and any media business today.

Any strong subscription business has only ever been built slowly and steadily.”
    Some reporters balked at the paywall and subscription model, as writers who want their

work seen by the most possible people often do. Others felt like the job itself had mostly

not changed. Newer features were given prominence, like “field guides,” deeply-reported

stories about the state of an industry or topic. Today, the Quartz homepage appears more

like a NewsPicks-style curation tool — highlighting stories from other outlets in addition

to Quartz — than a traditional publisher homepage.
    As of the end of April, Quartz had 17,860 paid members. According to the latest Uzabase

filing, the site makes $118,000 in monthly recurring revenue from subscriptions. “We’re

covering the global economy for smart ambitious young professionals who want a more global

view of business journalism than they get elsewhere, and trying to be as useful to that

group as possible,” Seward said. Quartz is luring in new subscribers from places like its

existing newsletter audience, according to Weber. She aims to grow the subscription revenue

to 50/50 with advertising. “That doesn’t happen overnight and won’t happen this year,”

Weber said.
    Quartz employees question their parent company’s patience. Uzabase said the goal for

the restructuring is to “build a foundation for profitability between 2021-2022.”

According to Uzabase’s 2019 financial report, total revenue at Quartz, which primarily

consists of advertising, dropped 22% to 26.9 million last year from $34.8 million in 2018

. 
    Quartz today, current and former employees say, looks and feels a lot different. In the

years since the acquisition, the company has shed some of the definitive products that made

it a frequent subject for the media press. The Quartz app, an award-winning mobile news

product in the style of a chatbot, was retired in 2019 in favor of a newer product built

around the NewsPicks app infrastructure. It debuted with fanfare: “Quartz Pros” like

Richard Branson and Sallie Krawcheck offered in-app commentary. But Quartz ended the

contributor program and the service now looks like a typical news publisher app. According

to Apptopia, the new Quartz app has been downloaded about 700,000 times since it launched

in November 2018.
    As the culture shifted, the company in the past two years lost some of its key editors

to places like The New York Times, Reuters, and Medium, sapping morale. On the business

side, chief revenue officer Joy Robins decamped for the Washington Post. The newsroom also

had to deal with two tragedies, the deaths of editors Lauren Brown and Xana Antunes, both

from cancer. “Both of their deaths hit us really hard,” Seward said. “We felt those

deaths the way a family would feel them. I was really proud of how everyone was there for

each other.”
    In October 2019, the attrition culminated with the exit of Delaney, now an advisor and

New York Times opinion section senior editor, and Lauf, who became chairman and later moved

to an advisory role. “They were really the heart and soul of Quartz, and it could never be

the same without them,” said one former staffer. Seward, a co-founder, was named CEO and

Weber was promoted to president.
    Returned to unparalleled
    By March of this year, Quartz employees were bracing for layoffs. Two smaller rounds of

layoffs in 2019 had already exposed some of the uncertainty surrounding the business. When

the pandemic broke out, Seward indicated that cuts were on the horizon (at the end of last

year, Quartz had 188 employees).
    The layoffs were deeper than expected. Management rejected offers from the Quartz

editorial union to hold buyouts or a workshare program, tactics that had been utilized by

other struggling news outlets in Covid-19 times. The company declined to comment on

negotiations, but Seward said it made more sense to do one severe cut than several over a

longer period of time. 
    For now, the layoffs have left staffers feeling dazed. Practically the entirety of

Quartz’s geopolitics team was laid off ahead of an enormous political story. The award-

winning video team was also shown the door. “None of the cuts we made were easy or

obvious,” Seward said, adding that Quartz was proud of the quality of the video work but

that it had never been able to figure out a way to generate significant revenue from it

(particularly after Facebook curtailed its news video exploration).