According to our industry sources and several corroborating reports, ESPN columnist/talking head/producer/editor Bill Simmons is seriously considering leaving ESPN when his current contract is up next year.
Simmons, who reportedly makes more than $US5 million a year, is, according to his pals, “furious” at his ESPN bosses over his recent three week suspension, given to him when he insulted the commissioner of the NFL on a podcast and then challenged ESPN to do something about it.
Supposedly, Simmons would like to “go independent but get investment, promotion, sales, tech platform from a partner.”
Informed of Simmon’s current salary and also of his desire to create his own media company, Kenneth Lerer, the chairman of Buzzfeed and co-founder of The Huffington Post, had the perfect response.
“Knowing what I know now,” Lerer told The New York Times, “I think [Simmons] should say: ‘I had a breakdown, I didn’t mean what I said. I’m back at ESPN and I love it.’ “
In other words: Bill Simmons would be totally nuts to leave ESPN and strike out on his own.
Two reasons Lerer’s advice is good advice:
- Building a digital media company from the ground up is hard, health-wrecking work.
- Even if you do successfully build a digital media company, the money isn’t necessarily better than the salary Simmons makes now.
There’s no doubt Bill Simmons works hard. He’s always writing 4,000 word columns, travelling to see and cover sporting events, and managing a staff of a couple dozen at Grantland. And, he reads almost all the emails that his readers send him, which is genuinely impressive.
But does he work as hard as the people who build digital media companies from the ground up?
Back in 2007, when The Huffington Post was two years old and just starting to get huge, Arianna Huffington one day found herself waking up in a pool of her own blood in her office. She thought maybe she had a brain tumour. But then she went to the doctor, and they told her she was working too many 18-hour days.
Eventually, Huffington sold her company to AOL for $US315 million. You might think that’s a huge number, and one worth chasing. But consider this: Huffington had to raise a lot of capital from outside investors to hire enough staff to get her company so big. By the time HuffPost sold, she only own 6.6% of the company — netting her $US21 million on the sale. Simmons will make that much money in four years of gabbing on TV and writing long online at ESPN.
If Simmons were to strike out on his own, he would be lucky to do as well as TechCrunch founder Michael Arrington did building his company.
But boy did he pay for it.
In 2008, Arrington told The New York Times: “”I haven’t died yet.” He said gained 30 pounds and developed a sleeping disorder in the first three years of TechCrunch’s operation.
“At some point, I’ll have a nervous breakdown and be admitted to the hospital, or something else will happen.”
In an Inc. article about how he works, Arrington said for TechCrunch’s first four years, “I’d work until I passed out, and wake up eight or nine hours later, which might be 4 p.m. or 3 a.m. Then I’d work again until I passed out.”
“I missed a lot of social things. I didn’t keep up with friends. I was a mess.”
In 2010, Arrington sold TechCrunch to AOL for ~$US30 million. Because Arrington didn’t raise a lot of capital building TechCrunch — he bootstrapped it, so to speak — he ended up keeping something like $US20 million of that money. Again: that’s great money for most journalists, but Simmons can make that much at ESPN in a few years without giving up his Clippers season tickets.
There are so many other stories about how hard it is to build a digital media business. In December 2007, Om Malik of tech blog site GigaOm suffered a heart attack.
The New York Times wrote a profile about one of our executive editors, Joe Weisenthal, and revealed that Joe works 16-hour days starting at 4AM every day.
There are two final reasons why Ken Lerer is right, and that Simmons would be nuts to leave ESPN.
The first is that Simmons has designed his site, Grantland.com, around the idea that writers shouldn’t have to worry about traffic. The result is that Grantland’s traffic is tiny. It reached under 5 million people in August, according to ComScore. For comparison SB Nation had 13 million visitors that month. Deadspin had 25 million.
ESPN is perfectly happy with Simmon’s tiny traffic because ESPN.com is already a traffic monster, and Simmons’s personal brand makes the rest of ESPN good. ESPN is in traffic optimization mode, not traffic growth mode.
If Simmons were out on his own, he would have to be in traffic growth mode. His so-called “halo effect” wouldn’t be nearly so valuable. He’d have to drive his staff to produce things lots and lots people want to read. Does he really want to do that?
The final reason Simmons should stay at ESPN: What would be the point of leaving?
If Simmons were to take investment from an outside partner, he would have to provide those partners liquidity at some point. Perhaps he would be able to do that by turning his new company into such a profit machine that he can actually buy his investors stock back. But that kind of thing almost never happens.
More likely, Simmons would provide liquidity to investors by selling his new company to a big media company.
The most likely buyer, of course, would be ESPN.
Then Simmons would be back to square one — except he would have lived through something like a massive weight gain, a heart attack, a sleeping disorder, or some kind of skull fracture like the one Arianna Huffington got.
And he’d be running a site that focused more on traffic, and less on quality.
So, sure, Simmons could go down that road. Or he could just keep collecting $US5 million per year for writing columns. Probably, he’ll get even more money than that in a year.
So…repeat after Ken, Bill.
“I had a breakdown, I didn’t mean what I said. I’m back at ESPN and I love it.”