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Q&A

Going Big with Small Digital Publishers

Brian Fitzgerald has the unenviable task of telling media entrepreneurs their businesses will never be hits. And then he presents them with an offer: Join us.

That’s the corporate strategy for his digital media conglomerate, Evolve Media. The company was founded as Gorilla Nation Media in 2000 and had its biggest hit in 2012 when it sold its female lifestyle site sheknows.com to private equity firm Great Hill Partners for a nine-figure sum.

Evolve buys up struggling media outlets, cuts costs and then places the companies under its male and female lifestyle media brands: Totally Her and Crave Online. The company has acquired a total of 50 sites and plans to acquire up to four more by the end of the year.

Legacy media companies are not interested in small acquisitions, Mr. Fitzgerald says, leaving sites with low-seven-figure annual revenues but still losing money with nowhere to go.

Mr. Fitzgerald spoke to The Information about the tough landscape for smaller media sites, why programmatic ads have hurt them in particular and why taking venture money in a bid to grow quickly (or “move fast” as Facebook would say) might not be the best idea.

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The native model is interesting because many sites will buy traffic to sponsored content pieces, which were previously sold to the brand at a higher price. It’s essentially an arbitrage. And when more and more people start offering native ads, which is what’s happening now, they’ll be less incentive to go to specific outlets. The biggest question with native ads is whether brands will decide that the return on investment merits the higher price.

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