Media

New York Times reportedly buys sports news start-up the Athletic

FILE — The New York Times headquarters in New York. Sasha Maslov/The New York Times


The New York Times reported Thursday that the company is buying the Athletic, the subscription-based sports-journalism start-up, in a deal valued at around $550 million.

The two sides reportedly had been in talks for months over an acquisition.

The Athletic launched in January 2016, promising wall-to-wall coverage and analysis of North American sports teams to its subscribers, who initially paid $10 per month or $60 per year for access to all its advertisement-free reporting. To accomplish its goals, the company poached respected sportswriters from other publications and hired others who had been laid off from their previous jobs in the industry, offering them attractive salaries.

Advertisement:

It was seen as an audacious endeavor, fueled by Silicon Valley hubris. In October 2017, co-founder Alex Mather promised to “wait every local paper out and let them continuously bleed. We will suck them dry of their best talent at every moment.” Ironically, he made that comment in an interview with the New York Times, the publication to which Mather and his partners will sell their company (he later apologized for the remark).

To cover its costs, which went well beyond the money generated from subscriptions, the Athletic raised somewhere around $140 million in venture capital funding, yet it never became profitable. And when the coronavirus pandemic put the sports world on pause in March 2020, the Athletic’s fortunes plummeted along with its subscription numbers. In June of that year, it laid off 46 employees, or around 10 percent of its workforce, and implemented salary cuts: 10 percent for those making $150,000 or less, with steeper cuts for those making more.

“[As] the pandemic has set in and as the sports calendar has remained frozen in place … tough decisions are necessary to guarantee our long-term viability through a period of slower growth and overall uncertainty,” Mather told the staff in an email.

Three months after those cuts, the Athletic announced it had reached 1 million subscribers and set its sights on expanding globally (it already had established a presence covering Premier League soccer in England) and growing its podcast network, where it did sell advertisements.

Advertisement:

“Our investors have been and continue to be incredibly patient,” Mather told CNBC in September 2020. “We just don’t think about exit, and we don’t know the upside here. There are very few companies doing what we’re doing. The New York Times is the tip of the spear, and they’re growing faster than ever. We don’t know what our ceiling is. When we feel like we know what our ceiling is, then it’s time for Adam and I to have a chat. But we have not come close to having a chat.”

Nonetheless, the news this year has been mostly about the Athletic’s attempts to market itself to potential buyers such as Axios and the New York Times. Adding the Athletic’s million-plus subscribers will further the Times’s goal of reaching 10 million paid digital-only subscribers by 2025 (as of November, it said it had 8.4 million subscribers, 7.6 million of them digital-only). In recent years, the Times has purchased a number of other smaller media companies, including Wirecutter and the production company behind the podcast “Serial.”

Conversation

This discussion has ended. Please join elsewhere on Boston.com