A Dogged Web Mag Pioneer

Volkman and 10-year vet Griscom are still sold on online-only content

Rufus Griscom is tall and gawky-cool, but the more salient point is that he is still standing. The founder and CEO of Nerve Media, which runs the smarty-pants erotica site nerve.com, has been publishing what he unapologetically calls an "online magazine"--as in, without a print component--since 1997. Last December his company launched the hipster parenting site babble.com. Coming this August, he says, is a green-lifestyle site; a much more ambitious entertainment site follows in November. (Titles for both are not finalized.) Four more Web-only titles will follow by the end of 2008, he says.

You are forgiven for thinking Griscom is dementedly digging in the wrong place. These are ambitious plans for a media format that is not yet codified--does "bigger than a blog, but smaller than Yahoo!" work as a description?--and in which independent players' track records are gruesome. The Securities & Exchange Commission filings for Salon.com's parent company, the publicly traded Salon Media Group (SLNM ), are studded with phrases like "Salon has incurred annual losses and negative cash flows from operations since inception." In its last fiscal year, Salon's operating loss topped $1.1 million. Notable early entrants word.com and feedmag.com gave up the ghost years ago. Launching in the 1990s meant living in a world in which Web advertising effectively did not exist, so Nerve.com groped desperately for ways to turn a buck. It tried charging for "premium" content. It started a short-lived print title. There was an abortive flirtation with an HBO (TWX ) series. There were, inevitably, rounds of layoffs. In 2002, Nerve.com latched on to the lifeboat provided by paid online personals, which enabled it to survive the remaining heavy weather. It was not until 2006 that advertising became its largest revenue generator. But Nerve.com today is a very profitable $4 million business, Griscom says, and Babble will move into the black by fall. Nerve Media has not taken money from investors, which include Lotus founder Mitch Kapor and former HBO head Michael Fuchs, since 2001.

ALL IT TOOK WAS 10 YEARS, give or take a few, for stand-alone Web content sites to become a business. Which is funny. They're exactly what the best blogs were supposed to displace. Blogs are cheaper to produce (sometimes they only need one employee), and are typified by laser-like focus in both tone and subject. Griscom insists that magazine-like qualities such as sharp design and variety still matter. And at least some ad executives agree that a richer site like Babble--which serves up a smartly designed mix of blogs, articles, product-shots, aggregated outside links, and message-board and wiki-driven "community"--deliver what even the best stand-alone blogs can't. "There's more breadth and more reason for a reader to be there longer," says Shelby Saville, senior vice-president at Starcom MediaVest Worldwide's digital agency StarLink. "With blogs, there is a limited amount of stuff." And so Griscom describes his new ventures in familiar terms. The upcoming entertainment Web site, he says, will resemble "a younger Entertainment Weekly, with a lot of interactive features." Chief among them: a massive data base of users' opinions, which will assign ratings to both cultural product and "professional" critics. (And--natch--lots of blogs.)

Griscom is mum on next year's launches, which is atypical for him. In the '90s, his founding Nerve.com with then-girlfriend Genevieve Field proved an irresistible narrative for journalists. Their breakup as a couple while they stayed business partners was the subject of a 3,000-plus word profile in The New York Times Magazine (NYT ). (Some things don't change: Griscom's wife, Alisa Volkman, co-publishes Babble, and will do so for the new sites as well.) Perhaps he has learned discretion from years heavy with both hype and hardship. Of course those years also forced him finally to figure out how to make the online magazine work. That happens when, unlike with print players' early work, there is no other medium to fall back on.

For Jon Fine's blog on media and advertising, go to www.businessweek.com/innovate/FineOnMedia

By Jon Fine

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