It’s the end of an era. Vice is going bankrupt, BuzzFeed News is shuttering, and other 2010s media darlings are flailing, grasping for life. Yet the internet continues. More and more creators are popping up, and founders are still flocking to Silicon Valley for venture capital money. If these businesses don’t want to be the next Vice, they should take these five lessons from Vice’s failures.
Over the years, rumors spread that Disney, Warner Bros., and others offered Vice millions—if not billions—to own the company. Only the c-suite and board know which offers came through, but given Disney invested $400 million, it’s likely offers came through. In lieu of the rumored sales, Vice took more investments valuing them at over $5 billion. Presumably, Vice said no to a sale because they believed they were worth over $5 billion, more than Marvel, and they wanted a higher sale number Now, they’re valued at zero in bankruptcy court. Lesson: If someone offers you hundreds of millions, take the money and run.
2. Diversify Your Revenue
Unlike Ozy, Vice earned money, but the majority of its revenue came through television production. The bankruptcy filming reveals their financials failed when one television buyer, a Greek company called Antenna, canceled a deal. Every business needs multiple serious revenue streams.
3. Let Your Fans Define You, Not Your Haters
Even if Antenna continued to send money to Vice, the company could have still landed in bankruptcy court. For years, Vice’s fans have declined. In more prosperous years, the company catered to a young male audience through edgy content. Other brands struggled to reach the demographic, so brands paid a premium to advertise on Vice. But catering to men sparked backlash, so Vice ran to the middle. They stopped publishing edgy, original content and replicated the center-left click-bait found on other sites. Their audience–and more importantly, that ad premium–declined. Meanwhile, more brave brands, like Barstool Sports, ignored their hates, grew their male audience, and sold to a publicly traded company. Creators should stop worrying about offending their haters and focus on pleasing their fans.
4. Recognize Your Size
Of course, Vice’s edgy content would only attract so many people. Vice was likely only ever going to be worth several hundred million at most, but the founders wanted to be as big as Disney. The problem was that brands came to Vice when they wanted to advertise on a cool, edgy news platform. Once Vice went mainstream, they struggled to sell cool. So the company launched a cable channel, hoping to earn more money. The founders also believed this would make them an even more relevant company to young people. But millennials don’t watch cable anymore, and few people watch Vice’s network. The company refused to recognize its true size, so now it’s nothing. Not everyone can or should be a billion-dollar brand. Accept your size.
5. Follow Your Business Plan, Not Your Ego
Many of these issues go back to a central issue: ego. Vice’s founders wanted to be bigger than Rupert Murdoch. Instead of following a business plan, they chased their own Gen X egos, which wanted to own a cable channel like MTV, which in and of itself is irrelevant. When you’re growing a business, focus on the bottom line and what the finances tell you, not your dreams. Otherwise, you’ll be left with broken dreams and little cash flow.