WEBVTT 1 00:00:00.220 --> 00:00:09.960 I'm trying to think about this, about how to say this in the most diplomatic way. I think we're in a kind of a new shitty normal. You could save your candidness for when we talk about the numbers. Yeah. 2 00:00:09.980 --> 00:00:21.480 [laughs] I think that the, the more specific and the more niche you go, the better you are. And I think intimacy and accuracy and expertise are super important, and that's what we try to do every day. 3 00:00:21.599 --> 00:00:40.120 [upbeat music] This week's episode is brought to you by Audigent. 4 00:00:40.800 --> 00:00:49.260 Publishers often struggle to know which partners bring incremental value, and the complexity of programmatic advertising has only exacerbated this problem. 5 00:00:49.980 --> 00:01:00.680 Audigent has focused on demand generation for premium publisher data since day one, delivering customized solutions that drive additional direct and indirect revenue. 6 00:01:01.170 --> 00:01:13.760 Audigent's platform is simple to integrate and focuses on a combination of technology, service, and unique demand, providing a proven solution for what publishers need today and into the cookieless future. 7 00:01:14.260 --> 00:01:27.980 White glove service, superior technology, and demand generation are three primary reasons why some of publishing's most recognizable and innovative brands rely on Audigent. To learn more, visit audigent.com. 8 00:01:28.240 --> 00:01:40.760 That is A-U-D-I-G-E-N-T dot com. Welcome to this week's episode. I'm on a bit of a run here with Washington, D.C. publications, and that's for a variety of reasons. 9 00:01:40.840 --> 00:01:48.780 But one of them is that there is a lot of media innovation happening right now in our nation's capital, and I don't think that's a coincidence. 10 00:01:48.820 --> 00:02:00.320 We're seeing a flight to focus overall, but also to targeting high-value audiences. Publications helping influential people make sense of the twists and turns of the government fit perfectly in this trend. 11 00:02:00.400 --> 00:02:08.020 They lend themselves also to high-priced ads and sustainable direct revenue opportunities, not to mention events and other revenue streams. 12 00:02:08.840 --> 00:02:16.440 One of the most promising of these new publications in the last couple years is Punchbowl News, started by former writers of Politico's Playbook franchise. 13 00:02:16.600 --> 00:02:32.500 Jake Sherman, one of Punchbowl's co-founders, joined me this week to discuss how Punchbowl differentiates with its laser focus on the sausage-making process that is also known as how we make laws in this country, and also how the company reached ten million in revenue in its first year. 14 00:02:33.080 --> 00:02:42.260 As a reminder, if you can, please leave a rating and a review on Apple Podcasts. Helps people find this podcast, and I appreciate it. And now on to the episode. 15 00:02:42.930 --> 00:02:55.540 [upbeat music] You know, I've written recently about how this is something of the Roaring Twenties for digital publishing, with a new generation of new ventures that we haven't seen really since the mid-2000s to early 2010s. 16 00:02:55.560 --> 00:03:07.440 And I think what's different about this new crop is that most aren't going for the largest audiences with a general interest approach but are narrowing in on specific high-value areas, and particularly those that reach elite audiences. 17 00:03:07.660 --> 00:03:21.800 And one of those new entrants, just over a year old, is Punchbowl News, founded by veterans of Politico, including its flagship, uh, newsletter franchise, Playbook, that was finding the value in email newsletters before it was cool. 18 00:03:21.840 --> 00:03:32.160 Jake Sherman, Punchbowl co-founder and former Playbook author, is joining me this week to discuss building this new brand. Jake, welcome. Thank you. Thanks for having me, Brian. Okay. Are you in the capital right now? 19 00:03:32.560 --> 00:03:37.720 I am in the capital- Okay... in a windowless room- Yeah... that you could see, but the podcast world cannot. Yeah. 20 00:03:37.940 --> 00:03:48.440 So I appreciate that because you have to get up super early in order to write this, and we had to do this podcast when Congress was not in session because the amount that you and your colleagues put out is really impressive. 21 00:03:48.500 --> 00:03:51.300 You're just killing it. So I always do origin stories, right? 22 00:03:51.500 --> 00:04:05.060 Um, so you started writing Playbook w-with your colleague Anna Palmer, who's now your co-founder, right, in two thousand sixteen after Mike Allen left with Jim VandeHei and a couple others to start Axios. 23 00:04:05.120 --> 00:04:12.800 How did that experience end up informing what you're building with Punchbowl? One thousand percent. [laughs] It was the biggest... 24 00:04:13.180 --> 00:04:21.640 I mean, I would say this, Punchbowl News would not have existed without Politico, would not have existed without Jim VandeHei, Mike Allen, John Harris, all the founders of Politico. 25 00:04:21.840 --> 00:04:34.320 What happened was Anna and I and John Bresnahan, our, one of our other co-founders, have been writing together for as long as I can remember. We worked at Politico together for... I got there in '09. 26 00:04:34.620 --> 00:04:39.640 Bres got there in '07. He's one of Jim VandeHei's best friends, so he came on really early. 27 00:04:40.140 --> 00:04:51.360 So when Jim and Mike announced they were leaving, Anna and I kinda turned to each other and we said, I don't remember the exact TikTok in journalism speak, but we kinda said, "Let's make a run for this. 28 00:04:51.600 --> 00:05:04.800 Let's try to pitch Politico on us doing Playbook." And at that point, we were just Hill reporters, and it was, I think this was early, probably early twenty sixteen, or maybe even twenty fifteen, and it was very arduous. 29 00:05:04.840 --> 00:05:16.360 We wrote a lot of memos [laughs] and we had to pitch kind of everybody at the company to get this job, including Robert Allbritton, the founder of Politico, who just sold Politico for a reported billion dollars. 30 00:05:16.420 --> 00:05:26.000 I haven't asked to see his checking account, but I imagine the reporting is accurate on that. Anna is a tremendous, tremendous, tremendous journalism business mind. 31 00:05:26.200 --> 00:05:35.400 So when we started Playbook, we realized we weren't Mike Allen [laughs] and, and we needed to create our own identity and bring in a kinda new generation to Playbook. 32 00:05:35.860 --> 00:05:45.100 We did Playbook for four years, and I think we doubled the audience or tripled the audience, doubled the revenue, or some combination of those two things. I don't remember exactly what it was. 33 00:05:45.200 --> 00:05:53.140 And we really thought of it as almost as if it was a candidate, right? [clears throat] Playbook was this political candidate we needed to evangelize for. 34 00:05:53.180 --> 00:05:57.620 We took dozens of trips around the country trying to bring people into the fold. 35 00:05:58.240 --> 00:06:09.770 And at some point, it became clear after resisting being an entrepreneur, or not even re-really having any interest in being an entrepreneur for a long time, [laughs] we said to ourselves during the pandemic, "We could do this. 36 00:06:09.980 --> 00:06:18.200 We know the audience. We know what they're interested in. We understand the business model. We have ambitions, and let's do this." 37 00:06:18.320 --> 00:06:29.832 And so we felt like we had the playbook, so to speak, [laughs] to try to get this done, and that was the birth of Punchbowl News in our minds.So what did Playbook get right? 38 00:06:29.992 --> 00:06:39.022 Because I think Politico has been a, a model used for a lot of people that wanna go deep, particularly in areas of policy and business, greater heat in society. But what do you think? 39 00:06:39.052 --> 00:06:49.752 I mean, Playbook i- is, I, I call it like the flagship because I think it w- it was one of the big differentiators of Politico 'cause it set the agenda, if you will. I mean, at the time it wasn't like email was email. 40 00:06:49.772 --> 00:06:55.932 It's like a place that you just dump links and say it's an RSS feed, right? But I feel like Playbook took a totally different approach. 41 00:06:57.132 --> 00:07:03.592 So if you take it back a few steps, Playbook, first it was the note, and then it was various other things. 42 00:07:03.632 --> 00:07:16.472 But Playbook, what Mike's genius, and what we tried to carry on at Playbook, and he was writing for an audience of several hundred people who were in the game and in the business and in the industry. 43 00:07:16.512 --> 00:07:25.592 He was not trying to be everything for everybody, and that was what was genius about it. And he understood audience. He had... Mike, and he still does to, to, to a large degree. 44 00:07:25.652 --> 00:07:30.972 I mean, Mike is one of my dearest friends, and I, I love him, and I, I love all the opportunities [chuckles] he's given me, to be honest with you. 45 00:07:31.152 --> 00:07:41.672 But what it really understood was that it had a very clubby feel, and it almost made you feel like you were an insider in a very kind of wink and a nod way about a lot of things. 46 00:07:42.152 --> 00:07:46.572 I think that in more contemporary times, that's more difficult. 47 00:07:46.652 --> 00:07:57.902 I think the media landscape has changed a lot, and I'm not sure that formula that Mike championed and created and we carried on really is what people are looking for anymore. I don't know. 48 00:07:58.092 --> 00:08:06.332 I try to think about what we do, not what other people do. [chuckles] But we referred to it as the flagship product at Politico, and it was, and it, I guess it still remains to be. 49 00:08:06.372 --> 00:08:19.132 But Mike had this audience and made you feel like you were special and you were part of it, and you were in something that was very cool, and that lasted from '06 to when Mike left, and we tried to carry that on until twenty twenty. 50 00:08:19.532 --> 00:08:29.232 And I, I just think in today's day and age, people aren't looking for that as much. Why is that? They're still wishing people happy birthday, and I'm like, "I don't know these people." Right. And that's kind of it. 51 00:08:29.632 --> 00:08:38.492 [laughs] Um, I don't know. I don't spend a lot of time thinking about what they do. [laughs] But I kind of felt it... I'm trying to think about this, about how to say this in the most diplomatic way. 52 00:08:38.692 --> 00:08:46.972 I, I believe- Don't, don't be diplomatic. Don't be diplomatic. No, I ha- I have to be 'cause I love Politico. It's given me everything, so I'm very fortunate to be part of the Politico extended family. 53 00:08:47.052 --> 00:08:58.232 You can save your candidness for when we talk about the numbers. Yeah. [laughs] Well, I'll be can-- I'll be uncandid there too. No, listen, I think that you need to really... I, and you've written about this a ton. Yeah. 54 00:08:58.252 --> 00:09:05.661 And, you write about this a lot, and I think you pull your punches sometimes. I do. And maybe you shouldn't pull your punches. [laughs] But- Oh, shit. [laughs] This isn't a three sixty, Jake. 55 00:09:05.752 --> 00:09:12.532 I don't like where this is going. [laughs] No, listen, I think that the, I think that the, the more specific and the more niche you go, the better you are. 56 00:09:12.572 --> 00:09:23.332 And you c- and I think intimacy and accuracy and expertise is super important, and that's what we try to do every day. So you're a congressional junkie. I am. If I could... Right? 57 00:09:23.732 --> 00:09:29.252 I think the original Playbook was a bit broader than that 'cause Washington has, like, a lot of different levers of power. 58 00:09:29.512 --> 00:09:38.172 Congress is really the locus 'cause that's where the money is apportioned, and, and that's the most important thing generally. [laughs] Where the money goes, the power goes. 59 00:09:38.812 --> 00:09:50.492 But I would say this, I would say what Mike did really well, Mike started Playbook in the end of the Bush administration and the entire Obama administration. And he was a White House reporter. 60 00:09:50.501 --> 00:10:02.472 That's where Mike made his bones at the Post and at Time Magazine. Yeah. And so that Playbook reflected him and reflected his view of Washington and the world. But yes, he focused a lot on that side of the coin. 61 00:10:02.532 --> 00:10:15.332 When we got Playbook, we took it in the waning days of the Obama administration, and mine and Anna's view of the world was from Capitol Hill, and we were not Trumpologists. Like, we never claimed to be. We don't... 62 00:10:15.392 --> 00:10:25.072 I mean, we wrote a book. Crap enough. And I wrote a book. Very crap, Jake. Yeah. [laughs] Very. And I wrote a book in the Trump era called The Hill to Die On, which is about Congress in the era of Trump, not Trump. 63 00:10:25.272 --> 00:10:37.432 And so our view was, where could we provide value add for Politico and for Politico's audience at Playbook, which was on Capitol Hill. So that was our view of it. Now that we didn't only cover Capitol Hill. 64 00:10:37.472 --> 00:10:46.331 I mean, we interviewed f- in, in our event series at Politico, we interviewed- Yeah... Mark Meadows, the vice president, secretary of state. I mean, we did a whole ton of those things. Yeah. 65 00:10:46.372 --> 00:10:54.472 But I think each of these at, at, I'm speaking about Politico, represents the view and the background of the author. So I think- Yeah... that's kinda how I view that. 66 00:10:54.732 --> 00:11:05.342 So was the opportunity that, uh, uh, all three of you saw to apply the congressional lens to power. A lot of people cover power and from different angles. And- Yep... 67 00:11:05.392 --> 00:11:16.292 in Washington, there's a lot of different power bases. But it seems like you guys are saying, "Look, let's be clear, the Capitol is the most important, and that's gonna be our lens to telling the story of power." 68 00:11:16.912 --> 00:11:28.712 The entire city exists with an eye on Congress. I've long had the view that the presidency is a overrated in terms of power institution, and we see that right now, right? 69 00:11:29.092 --> 00:11:38.512 Build Back Better Act, a, a massive piece of legislation is completely stalled. President's top priority. Why is it stalled? 'Cause of Congress. Voting rights stalled because of Congress. 70 00:11:38.592 --> 00:11:51.432 Congress is the most important institution in America, in my estimation, and we are positively obsessed with how Congress works and how everything moves through this building and the entire ecosystem of Washington. 71 00:11:51.662 --> 00:12:01.192 The lobbying world, the campaign world, billions and billions of dollars exists to influence and to get this building to move or not move. 72 00:12:01.632 --> 00:12:16.872 [laughs] And it's as simple as that, and me, Bres, and Anna, John Bresnahan, our other co-founder, um, have been doing this for a long time and have, and are really well sourced in the leadership, and there's no more important institution in my view than the leadership of Congress. 73 00:12:16.912 --> 00:12:27.500 And that's what we tried to do. And by the way, there's tons of white space in the marketEmpty space in the market, niches around town that have to do with Congress that we wanna fill. 74 00:12:27.680 --> 00:12:31.660 And that's why we named it Punchbowl News. Punchbowl's the Secret Service nickname for the Capitol. Mm. 75 00:12:31.840 --> 00:12:46.300 And our view of power in Washington is always going to be through this building, and through the actors in this building. And whether it's campaigns or legislating, we call it the politics of governing. 76 00:12:46.340 --> 00:12:52.600 So that's how we view the company. Yeah. It's such the locus of Washington that I talked about living in Washington many years ago. Yep. 77 00:12:52.640 --> 00:13:02.100 And back then, before Uber, we had to deal with the zone situation- Oh, I hated it... of DC taxis, and it was all based off of Capitol Hill, actually. So [laughs] Mm-hmm. 78 00:13:02.140 --> 00:13:11.800 That's- That was a big rip-off when I was in c- a college student in DC. Yeah. Nobody would take me home- And the z-... from Adams Morgan to Capitol Hill. [laughs] Well, I lived at the barrier of a zone on 23rd Street. 79 00:13:12.060 --> 00:13:20.150 Of course. 22nd Street was a zone, so I just crossed the street and was able to get a cheaper cab. Yeah, exactly. So l- what, how else did you wanna differentiate when starting this brand? 80 00:13:20.190 --> 00:13:26.800 'Cause i- it's, the differentiation is important in the market. You can differentiate through execution, through formats and stuff like this. 81 00:13:26.840 --> 00:13:34.770 But obviously the lens is different in that you're just gonna go narrow and deep with Congress, 'cause that's a giant story, and arguably the most important one. But how else? 82 00:13:35.480 --> 00:13:44.500 Yeah, so the main thing, and I know a lot of people listening to this will think it's trite, but we felt very firmly that news should not be a one-way street. 83 00:13:44.680 --> 00:13:49.900 We, we don't want to exist to shove news down people's throat and leave them to figure it out from there. 84 00:13:49.920 --> 00:13:59.700 So we've created a community around this content, and there's a stickiness to it, and we do a ton of events, social, newsmaker, brown bag lunches. 85 00:14:00.240 --> 00:14:10.940 A, a lot of that's been virtual, but for example, we'll do a brown bag lunch once every X. I don't know, when legislating is crazy, we do it once a week. When legislating is not as crazy, we do it once a month. 86 00:14:11.000 --> 00:14:23.020 And we have hundreds of people [laughs] who are on this brown bag lunch, and we get emails from people who are premium subscribers, who are like, "This is the, such a huge addition to my working life." 87 00:14:23.050 --> 00:14:34.180 There's all these memes on Instagram that people who are lobbyists read Punchbowl News in the morning or listen to our brown bag, and then just regurgitate it as their own for their clients in the afternoon. Yeah. 88 00:14:34.240 --> 00:14:41.140 Which I find humorous, and maybe I should be making much more money than I am if that's what they're [laughs] what they're doing. But we think of it as an ecosystem. 89 00:14:41.200 --> 00:14:49.200 We wanna be a big part of this community's life in every aspect, whether it's social, newsmaker, news, all sorts of things. 90 00:14:49.260 --> 00:14:55.520 We recently, we're moving into a, a townhouse on Capitol Hill, which we see as almost an extension of our content. 91 00:14:55.580 --> 00:15:00.560 It's our offices, but it's where we're gonna be holding events, both news events, social events, all sorts of events. 92 00:15:00.600 --> 00:15:10.040 And we've done dozens and dozens of events last year, both virtual and in person, so that's a huge differentiator. And also, I'd just say, like, our credo is power people politics. 93 00:15:10.200 --> 00:15:18.800 We are focused on the people up here, how they get power, use power, and how they use it to advance their own agenda, and how they use it to advance legislation that they want to advance. 94 00:15:19.220 --> 00:15:26.080 Okay, so it's for the swamp creatures. For the swamp creatures, by the swamp creatures. We don't- Who swamp around. We're, I'm not a swamp cre- Anna's from North Dakota. 95 00:15:26.130 --> 00:15:35.260 [laughs] So she's not a, she's not a swamp creature, although I guess we all are to a certain degree. No, but it's- But no... it's for an influen- All pe- The, it's for the people who are powerful in Washington. 96 00:15:35.380 --> 00:15:45.200 Washington is a very strange place where there are extraordinarily powerful people who those of us who live in Miami and other places have never heard of, but are extraordinarily powerful. 97 00:15:45.700 --> 00:15:52.680 But I will say, we have a humongous audience on Wall Street, which is probably- Yeah... not surprising to you. Because they have to know, they have to know, right? Exactly. 98 00:15:52.760 --> 00:16:03.560 A- and people aren't looking for trite, dismissive coverage. People are looking to understand what's going on, what to expect, w- who they should be watching for, why they should be [laughs] watching them. 99 00:16:03.620 --> 00:16:12.820 And for example, if I said USICA to you, your brain would freeze over. But there's a huge piece of legislation that's gonna impact semiconductor manufacturing, the high tech business. 100 00:16:12.860 --> 00:16:21.380 So, like, Silicon Valley, LA- Oh, yeah... these people are reading us- Yeah... um, in huge numbers, way bigger than we had ever thought, which is heartening to me. 101 00:16:21.410 --> 00:16:29.040 And also, this is not a cyclical business in that Congress is not going anywhere. There's gonna be a change in power. People need to understand that. 102 00:16:29.070 --> 00:16:37.980 And so we're really well positioned to tell that story, and I feel pretty good about that. Yeah. I saw Intel's making a fabrication plant in Ohio. Yep. Brilliant move. Purple state. 103 00:16:38.010 --> 00:16:47.040 [laughs] Everyone's gonna be in favor of it. [laughs] No losses. Hey, listen, they had, Biden had Republican Senator Rob Portman at the White House to announce that. Exactly. So clearly they know what's up. 104 00:16:47.100 --> 00:16:56.350 Okay, so how would you say your approach differs from that of Politico or Axios? Well, Axios, I love Axios. I love Jim and Mike, and I'll use that caveat at the beginning. Yeah. 105 00:16:56.400 --> 00:17:05.909 But I would even think that Jim and Mike would concede... Not concede, I mean, I talk to Jim every day, so I know what he... Like, we're just way deeper on the Hill than they are. Yeah. 106 00:17:06.080 --> 00:17:11.800 [laughs] I mean, I don't think that they would, they, I don't think that's w- something that they... And they have great Hill reporters, don't get me wrong. 107 00:17:11.840 --> 00:17:22.700 Elena Treen, who covers Congress for, for Axios, is really good and does a really good job. Um, and I think our focus on the leadership and on what the lead... 108 00:17:22.760 --> 00:17:32.400 Like, we care about 15 people more than anybody in the world, [laughs] I would say. Nancy Pelosi, Steny Hoyer, Kevin McCarthy, Chuck Schumer, Mitch McConnell, John Thune. 109 00:17:32.800 --> 00:17:39.860 I mean, the amount of time we spend thinking about them, reporting stuff, what they're doing, why they're doing it, how they're doing it, is... 110 00:17:40.010 --> 00:17:46.760 I think the big misnomer, I'll speak generally here, the big mistake a lot of news organizations fall into when covering Congress is chasing shiny objects. 111 00:17:47.180 --> 00:17:54.460 Like, I, I don't care what member X says, Congressman X, Y, and Z says most days. I just don't care. Mm. It doesn't matter to me. 112 00:17:54.720 --> 00:18:05.140 Do, do you mean that sort of like, I'm using air quotes, the, like, legislating, like, w- that's not really legislating, but it- it's for MSNBC or Fox News or whatever? It's, it's for, it's entertainment. Yeah. 113 00:18:05.160 --> 00:18:09.820 For, and, and I'm not saying there's not an important role for that. Like, we do plenty of accountability journalism. 114 00:18:09.880 --> 00:18:20.000 I'm working on something for tomorrow morning's edition that is quite accountability-y, if that's a word. But we are, but we are much more focused on movement, not motion. 115 00:18:20.240 --> 00:18:28.650 What is moving, why it's moving, how it's moving, timeline, what you should expect, what twists it could take, what turns it could take, all of that stuff. And so- Yeah... 116 00:18:28.720 --> 00:18:44.556 I'm not...Terribly interested in controversy X of the day. It just doesn't, it doesn't interest me but we just go much, much, much deeper into legislating and strategy and all of that stuff. Yeah. 117 00:18:45.996 --> 00:18:54.496 I- explain to me how you square that with the cadence, right? Because I think what Politico got right at the time was like a super high cadence. 118 00:18:54.556 --> 00:19:07.236 Like, the, my impression of the Washington coverage pre-Politico was that it was a little bit sleepy. It was a little bit- It was, yep... like, it was not like high octane, and now it's completely different. 119 00:19:07.266 --> 00:19:16.456 [laughs] Yep. I mean, it's super high octane, and everyone should follow Jake on Twitter, but it's like, "BBV, it's dead. It might be dead. It might be dead." And it's like how do you square the finding meaning? 120 00:19:16.466 --> 00:19:25.776 'Cause I think a lot of times, particularly like you've got three editions a day, like there's so much incrementality that's happening that sometimes I wonder if people are missing the big story. 121 00:19:25.856 --> 00:19:32.176 Like, I'm just like- But with all these increment-... with all these negotiations, I'm like, "Talk to me the final week," because honestly it's just gonna come down to the final weekend. But that's you, right? 122 00:19:32.336 --> 00:19:34.516 That's what you, that's what you wanna read. Yeah, I know. 123 00:19:34.576 --> 00:20:07.736 But like the people who are reading and subscribing and are, and they ca- like for them, and for people on Wall Street, and for people in Washington, and for people around the country who have lots of money at stake and lots of everything at stake, if Mitch McConnell goes out or Chuck Schumer goes out and says something that's a little bit different than he said the day before, that's incredibly important to our readership, and they need to, and, and they need to understand that, and we contextualize that for them, tell them why it's different, and tell them what it means for them. 124 00:20:07.776 --> 00:20:15.316 Okay, so incrementality is just simply important in the legislative process because that's- Absolutely... what the legislative process is. Absolutely. 125 00:20:15.976 --> 00:20:28.096 I mean, and by the way, if, I'll just give an example, if Bernie Sanders or if someone says that they want Medicare to cover hearing and vision and not dental, I mean, that might seem incremental to you. 126 00:20:28.156 --> 00:20:30.456 That's massive for our readership. 127 00:20:30.656 --> 00:20:49.856 Or just like, just very little nuances are very important and, and furthermore, um, what people are doing, what the big players in Congress are doing helps tell a big story about our government and about our politics and about congressional politics and the politics of governing, so that is important. 128 00:20:49.876 --> 00:20:57.276 I mean, we don't provide it with no context. [laughs] Yeah. That's not what we do. We provide it with context and why it matters and why it should matter. Yeah. 129 00:20:57.716 --> 00:21:08.846 So let's talk about actually going out and being entrepreneurial. Like [laughs] Yep... you said that you hadn't done it before. So I mean, you all knew that Playbook was a lucrative franchise and that- Yep... 130 00:21:08.896 --> 00:21:15.275 there's a lot of different ways to make money b- because Playbook was making money in a lot of different ways. There's events. 131 00:21:15.736 --> 00:21:24.396 There's a lot of ads that are run by trade associations and by Facebook saying, "Don't regulate us that way, but regulate us a different way." It's a great category. 132 00:21:24.636 --> 00:21:30.276 But talk to me about that decision to be like, "I wanna build something." Yeah, so it, it was really interesting. 133 00:21:30.456 --> 00:21:40.316 So once we made that decision, Anna and I have an agent who we've used for a long time 'cause we wrote a book and we did TV and all this stuff, and we called her. Her name is Rachel Adler. 134 00:21:40.336 --> 00:21:51.746 She's at CAA, and she said, "Yeah, that's a great idea." [laughs] And I said, "Oh, okay. Great." And actually, we got put in touch with Aryeh Bourkoff, who I'm sure you know. If not, you definitely know- LionTree, yes... 135 00:21:51.946 --> 00:22:02.416 who he is. Uh, LionTree. He was a big media banker, and, uh, I had a conversation with him, and I kinda told him my idea. And his basic thing was like, "This is a great idea," like, "We're in." 136 00:22:02.645 --> 00:22:04.716 And I was like, "What do you mean you're in?" He said, "We want to invest." 137 00:22:04.826 --> 00:22:16.356 [laughs] And it was like that simple, which I was surprised about, and we kinda decided what we would, how much money we would raise and, um, we- How much did you raise? A million. That's it? Yeah, that's it. Yeah. 138 00:22:16.416 --> 00:22:27.236 So let me ask you this, why raise money at all? That's a good question. Listen, we didn't know this was gonna work. We had no idea this was gonna work. We had no clue, and, you know, I have a family. 139 00:22:27.246 --> 00:22:36.576 [laughs] I needed to make money. And also, it was an important moment for me and Anna, uh, and, and John Bresnahan was not there at the time. He had not committed to come yet. 140 00:22:36.756 --> 00:22:42.376 I, I don't exactly remember the sequence, but it was right before we started, frankly. I mean, going back, would I raise money again? 141 00:22:42.436 --> 00:22:48.995 I'm, I'm not sure I'd raise the same amount of money again, but I mean, doesn't every entrepreneur say that? Like, it's either- Yeah... we raise too much or we raise too little. 142 00:22:49.076 --> 00:22:51.336 No one says we raised the exact [laughs] right amount of money. 143 00:22:51.796 --> 00:23:02.516 And listen, Anna and I ha- were very confident that we were writing things that our audience wanted and that our audience would follow, and we were right on both of those counts fortunately. 144 00:23:03.056 --> 00:23:14.556 And we saw under the hood of... We were at a news organization for a long time, and we kinda knew how we would do things differently 'cause we oftentimes said- Yeah... "Here's how we would do things differently. 145 00:23:14.616 --> 00:23:24.036 Here's what we think you should be doing. Here's how we think you should be innovating. Here's, here's how we could do something different that would be interesting, and, uh, here are all these opportunities." 146 00:23:24.096 --> 00:23:35.056 And we kinda just said to ourself after a certain amount of time, "Wait a second, we could do this on our own." Like, the climate is pretty flat in that it doesn't take a lot to launch an email. 147 00:23:35.156 --> 00:23:42.956 And we called up our friend Rachel Schindler who's one of our other co-founders who was at Politico. She moved to San Francisco to work for Facebook's news division. 148 00:23:43.636 --> 00:23:48.156 And we called her, and we were like, "How do we start a website? [laughs] What do we do?" 149 00:23:48.356 --> 00:23:57.416 [laughs] And Rachel's a couple years younger than me, and she's, I think, 29 or almost 30, and she's much more in touch with reality and technology than I am. 150 00:23:57.996 --> 00:24:07.056 And she said, "Well, here's what we need to do," and she joined us. And listen, we were confident of two things. We were confident that we knew what the audience wanted 'cause we live among the audience. 151 00:24:07.216 --> 00:24:09.216 That's what I feel like a lot of people don't understand. 152 00:24:09.396 --> 00:24:17.476 Just because you have a company and you've been doing this for a while, it doesn't mean you can kinda sit back in a glass office and kick your feet up and be, "Here's what I think of the news of the day." 153 00:24:17.526 --> 00:24:24.015 [laughs] Like, I'm in the capital. I spend 16 hours a day here. I mean, this is no picnic. Anna's grinding away. Bres is grinding away. 154 00:24:24.056 --> 00:24:33.256 I mean, we built a company around us and people who think like us, and our audience trusts us, and that's something that I think is really important is, like, the intimacy factor, right? 155 00:24:33.296 --> 00:24:43.656 Like, people not only read us, people see us on the Hill. They see us at events. They see reporting, so they kind of feel like these are people who have good sources and we can trust. 156 00:24:43.696 --> 00:24:55.516 And secondly, we felt if we created that product that we knew we could create, then the advertising money would follow us.And it was kinda that simple, and we had a pretty good first year based on that kind of basic thesis. 157 00:24:55.796 --> 00:25:03.946 Yeah, so let's talk about the first year- Sure... 'cause you're now a year old, so this is the candid part of the, uh, the conversation. I hope you're warmed up. Yeah, I, I don't know. 158 00:25:03.976 --> 00:25:09.056 [laughs] I'll be as candid as Anna allows me to. Okay. And Anna's not here, but she's channeling my brain. 159 00:25:09.076 --> 00:25:18.876 'Cause, you know, I get all these private messages giving me shit about people not being forthcoming about- Listen, we got shit from somebody... I'll just tell you what- Oh, the 100,000. Let's start with that. 160 00:25:18.916 --> 00:25:27.576 Let's start with the 100,000 subscribers. Um- Yeah, so what... Let me start with what we say- [laughs]... about our audience, and you can tell me if I'm being forthcoming or not. Well, I didn't read it. 161 00:25:27.656 --> 00:25:37.206 I'm like, "No way they have 100,000 paying subscribers. Of course it's emails." This doesn't take a genius to figure out. That would be $30 million. You're charging $300 a year. We have in excess- [laughs]... 162 00:25:37.216 --> 00:25:50.256 we have $1 million-plus of subscription revenue, and we did 10 million i- i- in revenue. That's pretty forthcoming, and we're very clear about our offerings. We do newsletter sponsorships, which you could see every day. 163 00:25:50.296 --> 00:26:00.736 It's as transparent as it comes. We do events, which people sponsor. We did several event series last year, both in person and virtual, depending on the COVID [laughs] situation of the week, and that's about it. 164 00:26:01.456 --> 00:26:12.316 We grew from four when we started, and now we're nine, and we have a bunch of jobs that we're hiring for, and that's it. That's remarkable. Honestly, that is remarkable success. Thank you. 165 00:26:12.376 --> 00:26:25.196 If you have a $10 million in revenue media business where you, you got nine people, that's really good. Usually, it's the tech companies that have a million dollars in revenue per employee. But also, I don't understand. 166 00:26:25.296 --> 00:26:31.676 You know, people have said, "Well, listen, they're still taking ad revenue." You and I have talked about this briefly. Yes, we're taking ad revenue. 167 00:26:32.126 --> 00:26:38.626 We are trying to create a sustainable company that is very focused on power people in politics [laughs] in DC and beyond. 168 00:26:39.156 --> 00:26:51.056 And if somebody had a million-dollar-plus subscription revenue on Substack, people would be like, "Look at that. That's amazing." So we've created both a sustainable subscription business and a sustainable ad business. 169 00:26:51.066 --> 00:26:59.236 Yeah. And I'm very proud of that. I don't... I, I, I feel great about where we are and what we plan to do in the future. Yeah. You know, I feel good about it. I always say the best way to make money is multiple ways. 170 00:26:59.296 --> 00:27:04.196 And, like, advertising, in quotes, is not good or bad. It's just, like, a tool. 171 00:27:04.456 --> 00:27:15.196 But you know what I think about when people say this to me and say, "Well, you shouldn't take ad revenue," it's like if you walk into a stadium, like, if you walk into Nationals Park, and they say, "Oh, we're not gonna put up any ads. 172 00:27:15.236 --> 00:27:20.196 We're just gonna take money from hot dogs" [laughs] That would not be a good opportunity for them. But it doesn't impact what we do. 173 00:27:20.256 --> 00:27:28.476 It gives us more ability to hire more journalists and hire more people to make this a cool business and cool content company. Yeah, and also it enables access, right? 174 00:27:28.596 --> 00:27:37.366 Because you could easily just do this all as subscription. It would be a smaller business. [laughs] Yeah. But it would be that you'd get a lot more than a million, uh, dollars in subscription revenue right now. 175 00:27:37.496 --> 00:27:49.656 But you wanna have funnel at some point, and advertising is a great way to introduce people to the brand. And the reality is you, you see the stats. 10% convert maybe if you're really good. 176 00:27:49.756 --> 00:27:59.056 You can have a multi-tier business. It's fine. [laughs] Yeah, and one of the more interesting things is the conversion, right? 'Cause Playbook was all free. We were kinda just writing it, and- Yeah... 177 00:27:59.116 --> 00:28:06.396 Anna, a- again, is much more of a businessman than I do. She was involved in thinking through business models at Politico. But the funnel is an interesting beast, man. 178 00:28:06.536 --> 00:28:15.086 It's something that a lot of people have taken cracks at, and it's something we worked very hard at, and we're proud of what we've done, and we think we have tons of opportunity going forward. 179 00:28:15.596 --> 00:28:22.896 So how do you think that mix will change? Do you have any sense? And again, I'm not religious about these things. There's a lot of advantages to recurring revenue. 180 00:28:22.936 --> 00:28:34.696 Recurring revenue is great because ads you gotta keep selling, so super important. But right now, the overwhelming majority is from sponsorship, either sponsoring events or sponsoring newsletters. 181 00:28:34.976 --> 00:28:42.526 Do you see that mix changing as you mature? Oh, yeah, we hope so. The basis of your question is, would you like more subscription revenue, right? 182 00:28:42.526 --> 00:28:51.836 That's basically what you're asking, and I- Well, I mean, yes, do you want more subscription revenue? But there's a push and pull between both, right? I mean, everyone wants everything. 183 00:28:51.976 --> 00:28:55.636 But look, okay, let's take everyone's favorite example, The New York Times, right? 184 00:28:56.036 --> 00:29:07.076 Their ad business took a hit based on macro factors but also particular New York Times factors when it's said, "We're a subscription company. We're a subscription company, and by the way, we're a subscription company." 185 00:29:07.136 --> 00:29:14.616 Yeah, I mean, listen, what we've tried to do and we've been pretty judicious and religious about is not say things that are just, like, blankets about our business. 186 00:29:14.896 --> 00:29:21.016 It's funny 'cause Jack Shafer pointed this out in a column- Yeah... our, our former colleague at Politico, which was like, we kinda just said what we're gonna do. 187 00:29:21.336 --> 00:29:30.316 We're gonna write really important news and break a ton of news about is- i- issues that matter, period, for Washington, period, the end. So I'm not going to say... 188 00:29:30.846 --> 00:29:45.356 We are a subscription business and an ad business, and DC is a pretty rich ad market, and also DC is a pretty rich subscription market in that Capitol Hill, where I'm sitting right now, we're in, like, uh, nearly 100% of every office on Capitol Hill. 189 00:29:45.396 --> 00:29:57.395 We have a ton of group plans of people on the Hill. Tons of lobbying firms, hedge funds, law firms, organizations, trade associations have big subscriptions plans to us. That's a great thing for us. 190 00:29:57.496 --> 00:30:08.656 We want to do both, and we want to do a lot of both, and I don't mean to be elusive here, but, like, we, we have two... We have people who are dedicated to growing both parts of the business in tandem. 191 00:30:08.856 --> 00:30:17.196 [laughs] And, and we're really excited about that, and we're not gonna say we are a subscription business. We are an ad business. We are a content business. 192 00:30:17.356 --> 00:30:26.846 We're gonna be breaking lots of news on Congress and on power and on legislating, and we would like a million subscriptions, and we would like a massive ad business. Yeah, yeah. That's what we would like. 193 00:30:26.876 --> 00:30:33.076 And you're gonna be pragmatic about it. That's what I like. That's the best- I'm just not, I'm not gonna say we're trying to do so- I don't... Like- I know... 194 00:30:33.096 --> 00:30:38.856 tons of people get into this business- It's good for marketing, though. Yeah, it is. That's what... I think we've seen a lot of that. Like, we're... 195 00:30:40.076 --> 00:30:47.176 I would say- Yeah, it's like Buzzfeed came out and was like, "Yeah, banner ads are terrible. It's all native advertising and stuff like this." And then they're like, "Oh, shit, we gotta run programmatic advertising." 196 00:30:47.216 --> 00:30:56.356 And the only people who cared about the hypocrisy were journalistsYeah. Business people are like, "Yeah, why not?" We're just not in the big proclamation business. Yeah. 197 00:30:56.416 --> 00:31:04.516 So the last thing I wanna talk about is you started at the waning days of the last gasp of the Trump administration, and then going into Biden. 198 00:31:04.546 --> 00:31:10.996 And that gets, like, an interesting bookend because I believe Axios started at the end of Obama and going into Trump. Yep. 199 00:31:11.486 --> 00:31:22.216 And I think Axios was really helped, obviously, with Jonathan Swan and all the who's yelling at who, who's mad at who [laughs] who's whatever. Totally different environment now. Yes, to our benefit. 200 00:31:22.616 --> 00:31:30.596 Yeah, because I think that's what's interesting is, I don't know if it's a knock on Biden, it's more boring. I, I'm not reading all of these Jonathan Swan's scoops about who's mad at who. 201 00:31:30.666 --> 00:31:41.936 Maybe people are mad at each other. Maybe they just accept that as reality. But the action has moved to the legislative sausage factory, which is the Capitol. [laughs] Yeah. 202 00:31:42.136 --> 00:31:53.116 2021 was the most consequential year for legislating in recent memory, at least in a decade, and we were all over that story. 2020... 2022 is shaping up to be massively consequential. The BBB is still alive. 203 00:31:53.216 --> 00:32:05.986 And by the way, as we get into 2023, if Republicans take back the majority, the slate is clean. We have an entirely new set of important people that we have to cover, and we feel really great about that. 204 00:32:06.156 --> 00:32:16.156 I wrote a book about Kevin McCarthy, [laughs] so I feel- Yeah... very good about my knowledge of Kevin McCarthy and the House Republicans, and I covered House Republicans from 2009 to 2016. 205 00:32:16.216 --> 00:32:23.166 It's where I spent most of my career. So we got into this to cover the politics of legislating, and that's- Yeah... what we've covered, and it's great. 206 00:32:23.276 --> 00:32:32.896 But what people don't realize, it-- I mean, maybe people do realize it, but, like, legislating is always going on, and there's always people who are trying to do things. 207 00:32:32.936 --> 00:32:41.436 And remember, the palace intrigue thing is a big piece of this. Who's trying to become speaker? Mm-hmm. What are they doing to become speaker? All of those things are just incredibly important to our audience. 208 00:32:41.916 --> 00:32:47.116 That's true, but isn't it that there are periods for legislating, and there's periods for electioneering? 209 00:32:47.406 --> 00:32:59.276 And, like, very little legislating gets done when everyone's scrambling to see, uh, who's gonna get reelected and who's not. Right. But that's three months every two years, right? Okay. 210 00:32:59.316 --> 00:33:06.466 So will Punchbowl's focus be more towards the horse race of elections then when that happens? So that's an interesting question. We talked about that. 211 00:33:06.496 --> 00:33:15.326 We wrote a little bit about that this morning and teased out how we think about that. So are we going to have a full-time embed on the 2024 campaign? I don't know. 212 00:33:15.326 --> 00:33:26.706 That's a long way away, [laughs] so I don't wanna- [laughs] Again, no big proclamations. Um, I have no idea how-- But I could tell you, since we're in an election year, how we're gonna cover House races and Senate races. 213 00:33:26.736 --> 00:33:35.315 We are going to cover them through the eyes of the leadership. What is the leadership doing? What kind of decisions do they have to make? Who are they looking to cut off? Who are they looking to boost? 214 00:33:35.396 --> 00:33:43.996 What are the big trends playing out across the country? We have two very young, eager reporters. I'll give them a shout-out. Max Cohen and Christian Hall. Christian is a recent graduate of Howard. 215 00:33:44.036 --> 00:33:52.116 Max is a recent graduate of Penn. Brian, we-- you and I are gonna be working for them, like, in the next year or two, so just get ready. Oh, God. I, I'm hoping I'm retired. 216 00:33:52.396 --> 00:34:01.376 [laughs] So, so- These young people are coming up. Gen Z. Millennials were tough enough, but Gen Z, they're cutthroat. They know what they're doing. I-- They are. I, I love those guys. 217 00:34:01.416 --> 00:34:06.576 [laughs] So I, I feel very good about my relationship with them, and they are my boss. They're savvy, too. That's the thing about them. [laughs] That's right. 218 00:34:06.636 --> 00:34:14.466 So listen, we're not gonna be putting people in to cover races to have, to have them cover Candidate X says something crazy. 219 00:34:14.476 --> 00:34:21.746 But we're gonna be covering it, A, through the leadership's lens, and B, through what are the big trends that we're seeing across the country in races. 220 00:34:22.236 --> 00:34:31.916 And we'll get into that a little bit more as we get closer to the election, but that's how we cover that, and we're gonna be doing both at the same time, both electioneering, I guess, and legislating. Covering both. 221 00:34:31.976 --> 00:34:49.376 So final question is, because you've covered The Hill for a while, and Washington overall, y- you've been part of that scene, is for those of us outside of it, it's hard sometimes to unpack what is just the normal thrust and parry of power and what is an aberrant situation, right? 222 00:34:49.636 --> 00:35:00.756 Sometimes I open up The Atlantic, and I'm like, "Oh, my God. I gotta close this thing down," because it seems like we're Banana Republic or something like this that i- is careening towards disaster. 223 00:35:00.776 --> 00:35:05.496 And you were at The Hill, and I think some of your texts to Meadows, I think it was Meadows, came out. They did. 224 00:35:05.536 --> 00:35:12.555 But, I don't know, like you've seen the broad sweep of things, and I think it's easy to get caught up in the sort of the, the, again, the incrementality of that. 225 00:35:12.656 --> 00:35:26.435 I mean, are things that different now than they were when you first started working on The Hill? Yes. So I think we were very clear about... And I'm not saying that you're, you're criticizing us in this way. 226 00:35:26.496 --> 00:35:43.016 But we were very clear that January 6th was an aberration, was a se- a seismic event and a massive... It was what it was. We don't have to get into all the, just how abnormal and dangerous Donald Trump was on that day. 227 00:35:43.196 --> 00:35:44.476 Yes, things are way different. 228 00:35:44.636 --> 00:35:57.916 The entire Republican Party is basically in service to Donald Trump, and that is different than when I got to The Hill, when Republicans led by John Boehner and Eric Cantor were like, "We are the sober stewards against the Obama administration." 229 00:35:57.936 --> 00:36:08.816 And [laughs] Right. Right. But you know what I mean. Yes, it's all changed. I, I don't, I can't give you any novel thoughts here about how crazy things have gotten. They've gotten crazy. 230 00:36:08.896 --> 00:36:20.266 And, you know, it's tough for us individually as reporters, 'cause, like, we care deeply about this place, or else we wouldn't be, like, covering the minutiae of what Nancy Pelosi is doing every day. 231 00:36:20.286 --> 00:36:28.316 And, like, we care about Congress. It's a beat that we've covered for a long time. We really enjoy it. So it's difficult to kinda see the- Mm-hmm... deterioration and all that stuff. 232 00:36:28.386 --> 00:36:34.786 So you just hope that it'll snap back to some level. But I just, I guess what I end up wondering is, snap back to what? Right. 233 00:36:34.836 --> 00:36:44.856 I mean, I can remember when, like, this guy, like, flew a plane, like, somewhat near the White House- Yep. I remember that... during Clinton. And the same, I remember it was like, "It's all because of talk radio. 234 00:36:45.236 --> 00:36:55.116 All this misinformation and lies being peddled." And we're talking about some of the same stuff. And I don't mean to minimize what happened on, on January 6th at, at all or some of the- Mm-hmm... rhetoric. 235 00:36:55.436 --> 00:36:58.236 But sometimes I wonder whether or not... You know, it's kind of like bad news. 236 00:36:58.296 --> 00:37:04.216 Like, the world is objectively better now, but we only hear about the bad shit, and we just hear more of it 'cause there's just more news and stuff like this. 237 00:37:04.316 --> 00:37:13.036 So sometimes I just wonder whether just how dysfunctional Washington is currently. [laughs] I, I don't think it's dysfunctional from the legislative set as much as... 238 00:37:13.136 --> 00:37:21.906 I mean, it was horrible in the Trump administration in that you'd get his negotiators up here negotiating a bill, and then they'd take it back to the White House. They'd have a deal, and Trump would say no. Yeah. 239 00:37:21.916 --> 00:37:28.836 So that aspect was just so annoying at all times to cover. It was like trying to pin Jell-O to a wall. Like, it just never worked, right? 240 00:37:29.336 --> 00:37:39.816 But, um, I don't know that we're ever gonna get back to a total normal, or at least for several decades, if that. I mean, I think we're in a kind of a new shitty normal. [laughs] I mean, I don't know. 241 00:37:39.856 --> 00:37:52.576 From just the politics of, just the tenor of politics has just gotten really bad in certain aspects. But I, I do think that it's gotten more normal recently to, to some degree. 242 00:37:52.616 --> 00:38:01.656 In some degree, some of the craziness has remained. Okay, Jake. I'm using that as the title for the podcast, our new shitty normal with- No, please don't... Jake Sherman. [laughs] Please, please don't. 243 00:38:01.716 --> 00:38:12.336 Thank you for that. You, you- I appreciate it. [laughs] You will get me, you will get me in lots of trouble because Punchbowl News is not a new shitty normal. [laughs] All right, Jake. Thank you so much. Thanks, Brad. 244 00:38:12.346 --> 00:38:26.996 It was a great chat. Thank you all for listening. We will be back next week with a new episode. [outro music]