Axios Wants Us to Read Everything in Bullet Points

From a New York Times story by Katie Robertson headlined “Axios Wants Us to Read Everything in Bullet Points”:

With much of the digital media world combining forces to survive, the founders of five-year-old Axios think they have the right recipe for success on their own.

The pitch, in Axios’s trademarked “smart brevity” format, goes a bit like this:

What to know: The company’s executives think its short-format writing will build back trust in the media among busy audiences and can teach corporate America to quit its long-winded jargon.

  • This year, Axios is pouring $30 million into expanding its footprint, said Jim VandeHei, the chief executive. It is spreading into cities (Axios Local), industries (Axios Pro) and workplaces (Axios HQ).

Why it matters: Axios is forging its own path when many of its digital peers are merging to increase their audiences and better compete with the big technology companies for advertising. Mr. VandeHei sees opportunity in local news, a space that other publishers have moved away from, and is bullish on Axios HQ, the software company-within-a-company that he thinks could eclipse the multibillion-dollar messaging service Slack.

  • “We have really firm opinions about where the world is going, and we want to control our destiny,” Mr. VandeHei said. “If you do a deal, that’s hard.”

Yes, but: Can Axios actually scale the bullet?

Go Deeper

Axios, started in 2017 by Mr. VandeHei, Mike Allen and Roy Schwartz, made its mark with scoopy Washington coverage and short-and-sharp national newsletters. It now has more than 400 employees, with 150 in its newsroom in Arlington, Va., and 2.2 million subscribers across its 34 national and global newsletters, all of which are free and make money from advertising.

Last year, as deal talks dominated the digital media industry, Axios held discussions about a possible merger with the sports news website The Athletic and a sale to the German media giant Axel Springer. Both talks ended. Axel Springer instead paid more than $1 billion for the rival publication Politico, which Mr. VandeHei helped start 15 years ago. The New York Times bought The Athleticin January for $550 million. Axios then raised money from Cox Enterprises that valued the company at $430 million.

This year, the company is aggressively expanding into the three new areas, Mr. VandeHei said. The products are meant to address what he sees as the public’s desire for the most important information in a format that is easy to read on smartphones.

Mr. VandeHei said he expected more than $100 million in revenue this year, up from $86 million in 2021.

“America is screwed if we don’t restore fast a common connection, a common truth and a common reality,” he said. “This can only be done closer to people’s homes, professions and workplaces — the places they can see, touch, verify. You do this with smart, clinical news and information — devoid of opinion and needless noise — pushed to consumers in an efficient, quick, respectful way.”

Driving the News

Mr. VandeHei said he had never expected to get into the local news business in small and midsize cities. But with more people working remotely and moving out of big hubs like New York City, “power and population is going to move into these cities.”

“We want to be there first,” he said.

In December 2020, Axios bought The Charlotte Agenda, a profitable newsletter, for close to $5 million. Using that as a model, Axios has introduced the newsletter format in 14 cities, including Atlanta; Charlotte, N.C.; Nashville; and Philadelphia. It plans to expand to 11 more by summer.

Two local reporters were hired in each city to helm a daily newsletter that is a mix of original reporting and an aggregation of articles from other outlets, said Sara Kehaulani Goo, the editor in chief of Axios. (The company recently hired Jamie Stockwell, a New York Times deputy national editor, to oversee Axios Local.)

“Even sooner than we expected we saw that was successful from a journalism standpoint — we saw high open rates,” Ms. Goo said.

As advertising revenue from the local sites grows, some cities are getting a third reporter. Axios Local generated nearly $5 million in revenue last year and has 700,000 subscribers across the 14 cities, a spokeswoman said.

Evan Smith, the chief executive of The Texas Tribune, a nonprofit in Austin founded in 2009, said he was an early subscriber to Axios Austin and reads it every day. “I’m pulling for them,” he said, but added: “Can you sufficiently cover the largest cities in America — which Texas has more of than any other state — with two or three reporters?”

Mr. VandeHei said Axios was first ensuring that its model for local coverage was sustainable and could work on a larger scale.

“We’re trying to think about how we can do this in every community in America,” Mr. VandeHei said.

Between the Lines

The company kept hearing from readers who wanted to use its newsletter format at their workplaces to get more people to read internal emails, said Jordan Zaslav, the general manager of Axios HQ.

“It comes from corporate and it just flies right over your head and you archive it, and the economic cost of that is huge,” he said.

Axios HQ, which promises to teach corporate America how to trim the jargon, is separate from the newsroom. Companies pay about $10,000 for an annual contract and use the software to write team updates and sales notes, Mr. Zaslav said.

The software uses artificial intelligence to suggest editing and formatting to distill blocks of texts into shorter bullet points. Axios HQ also has analytics that show the clients whether employees opened the messages.

A year after its start, Axios HQ has 210 clients, from major companies like Delta Air Lines to state school systems to small start-ups, Mr. Zaslav said. He said it was aiming for 600 clients by the end of this year. The company has about 60 people working exclusively on Axios HQ.

Axios HQ generated more than $3 million in revenue in 2021, including the editing and training services it also offers.

Brian Morrissey, a former editor in chief of the trade magazine Digiday who writes The Rebooting, a newsletter about the media industry, cautioned that the history of software businesses built by publishers “is not good.”

“There haven’t been very many success cases because they are very different businesses,” Mr. Morrissey said.

Catching Up Fast

While the national, global and local Axios newsletters are free, they are now supplemented by the new Axios Pro newsletters, which deliver hyper-niche reporting and are $599 for an annual subscription, or more for a corporate subscription. The initial tranche of Pro newsletters is focused on deal-making.

Three newsletters, about retail, fintech and health tech deals, went live this year. Two more — climate tech deals and media deals — will start this month.

The next set of Axios Pro newsletters will center on policy, and further out will be products for workers in the professional services, like managers and salespeople.

This is familiar territory — Mr. VandeHei helped set up the lucrative Politico Pro, a paid digital product from Politico providing policy coverage in Washington. While Axios has been almost exclusively supported by advertising, Mr. VandeHei said the Pro and HQ subscriptions might contribute to about 10 percent of the company’s revenue this year.

“People will pay a lot of money for products that will help them make more money,” Mr. Morrissey said of Axios Pro. “And the advantages of selling to businesses are that they are less price sensitive.”

Fabricio Drumond, the chief business officer at Axios, said the goal was to get to a 50-50 revenue mix with advertising and subscriptions. He said the company was not looking for additional funding from investors at the moment.

While Mr. VandeHei said he’s optimistic about the impact that Axios can have, particularly in covering local news, he’s clear on the end goal.

“We’re not doing this as some kind of romantic gesture,” Mr. VandeHei said. “We are ruthlessly capitalistic about only going into business lines that we think are going to be profitable in time.”

Katie Robertson is a media reporter. She previously worked as an editor and reporter at Bloomberg and News Corporation Australia.


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