Venture Voice – interviews with entrepreneurs

Entertaining Entrepreneurship

VV Show #60 – Larry Kramer of MarketWatch

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Today’s media executives plotting to charge for their content would do well to hear how Larry Kramer beat Jim Cramer’s by resisting pressure to put most content behind a pay wall while not relying entirely on advertising. To the average consumer, seemed to have come out of nowhere during the late 1990s to quickly establish itself as one of the leading sources of online financial information. For MarketWatch founder Larry Kramer, it represented the last chapter of his 15 year journey as a first-time entrepreneur. Larry started his career as a journalist, going from reporter to the top editor of the San Francisco Examiner in just 10 years with stops at the Washington Post and Trenton Times along the way. Larry founded DataSport Inc. (the company that would eventually morph into MarketWatch though a series of mergers and partnerships) with $500,000 from friends and family. He almost ran out of money early on. After a wild ride on the public market, Larry sold MarketWatch to Dow Jones for over $500 million in 2004 and went on to become the president of CBS Digital Media until 2006. Hear how Larry lived though two different careers and what he’s planning next.

1:30 Roots in Journalism, from paper boy to the Associated Press

3:25 “My whole career has been a series of breaks.”

5:20 Covering Woodstock

6:00 Entered Harvard Business School to write about business

6:55 Experiences at The San Francisco Examiner and The Washington Post

12:00 From cub reporter to Editor-In-Chief

16:00 A move into industry at Data Broadcasting, maker of real-time stock quote delivery hardware broadcast over FM radio

18:00 Spun DataSport out of Data Broadcasting, adding sports to the signal during nights and weekends for “displaced fans”

21:30 Raised $500,000 from friends and family, “which I’ll never do again,” and partnered with The Sporting News for branding and marketing

24:40 Last minute feature: betting lines from Vegas, the “lifeblood” of the product

25:20 “So we ended up with a lot of gamblers as our customers.”

25:45 Profit on paper, but running out of cash

26:50 DataSport purchased by Data Broadcasting

29:30 “Skunk works” internet project, DBC Online, building financial websites for newspapers, first client: USA Today

33:00 Spun out DBC Online and opened the site to everyone, monetized via advertising, partnered with CBS to create CBS MarketWatch

36:45 Incubating a new business within an old one

39:00 Pierson, owner of the Financial Times, buys DBC for its share in MarketWatch

42:00 An IPO at the height of the boom: $7M in sales but a $1B market capitalization

50:30 “I was worth $20M on paper that day.”

52:40 Bought Big Charts for $160M with MarketWatch “currency,” i.e. stock, for a second revenue stream and infrastructure

55:10 Big lesson from Big Charts: “have as many revenue streams as you can”

59:40 Sell the news but not the editorial expertise

1:00:20 Licensing news on other sites brought in another revenue stream, which allowed the site to survive the advertising slump

1:01:00 Competition with

1:03:50 “Bloomberg is a fine business and makes a fortune, but they’re a rarity.”

1:05:15 “You need to be in the free universe to be searched, to be all the things that cause you to grow and gain stature in the world today.”

1:08:15 On cash: “Your investors don’t want you to be a bank, they can put their money in a bank.”

1:10:15 On Dow Jones offer: “If they don’t buy us they’re going to compete with us.”

1:11:30 The bidding war for MarketWatch ends in a $528M offer from Dow Jones

1:15:10 “When you get money, you immediately meet people with a lot more money.”

1:18:00 Writing a book on the effect of the internet on not only media but all industries, “what’s happening today is as big as the invention of the printing press”

1:21:40 “The biggest problem is companies trying to protect their business models not their products.”

1:22:25 What’s your ambition now? The book, journalism, teaching, corporate boards and “sharing what I’ve learned”

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