Ascent by Acquisition

Ascend Media’s success is almost inconceivable when you find out that the company is just four years old. In 2006, the company’s total revenue was approximately $120 million, compared with $25 million in 2003, the year it made its first acquisition. Ascend Media now produces 50 business-to-business magazines and journals, 70+ e-newsletters (a number that continues to grow with advertiser demand) and hosts 10 trade shows and conferences. The fact that the company now has 480 employees in seven locations, including corporate headquarters in Overland Park, Kan., is most impressive to the company founders.Cameron Bishop, president and CEO, and Ron Wall, executive vice president of sales and marketing, formed the publishing company in partnership with CCMP Capital (formerly J.P. Morgan Partners) and Veronis Suhler Stevenson.“Our business is about the talent you employ. ... We demand editors to be content drivers on multiple platforms,” Bishop says, “and require salespeople to successfully sell multiplatform sales packages. It’s about the people.”Wall agrees that despite the company’s large list of accomplishments its most important asset is the quality of its employees.“You could put a spin on a bunch of [other assets that make the company successful] … how important it is to keep growing the overall revenue or how the number of e-newsletters represents positive growth toward developing a strong media mix. But, honestly, it’s the 480 members of our team,” Wall says. “I think it says something ... that nearly 50 people from our past professional lives have joined us at Ascend Media ....”The Making of a Powerhouse PublisherWall and Bishop have more than 62 years of combined experience in publishing. “Ron and I came out of the same college program and took slightly different paths when we both joined what was then called Intertec Publishing in Overland Park, Kan., back in the late ’70s,” Bishop says.Bishop started in marketing as an advertising copywriter, while Wall was focused on ad sales back then, before becoming a sales manager and then a publisher.“Which is where our paths converged,” Bishop says. “I moved into publishing management, too, and by the time we’d been at Intertec for about a decade, we were each leading separate divisions of the company at a time that it was just beginning to grow into the $400 million revenue generator that it eventually became …”Wall believes their secret recipe lies in the foundation they developed there.“I don’t think we’d be as good at building our own company if it weren’t for that 15 or so years at Intertec, where we literally looked at hundreds of potential properties to buy and actually ended up making 25 acquisitions,” he says. “That’s where all of our real media intelligence came into play, because you can’t acquire 25 companies, all of them with their unique needs and individual cultures, and not feel like you’ve gone through some intensive training on what works and what doesn’t.”There’s a reason this duo has formed a strong relationship—they think alike, but not exactly alike.“We’ve worked together, on and off, for 30 years … so you definitely get to the point of finishing each other’s sentences and enjoying a shared history,” Bishop says. “But we don’t always see things in exactly the same way, and that’s a huge benefit to the business relationship.”Bishop believes their differences are what makes the team work.“Ron loves the sales process, and he’s especially skilled at drilling down to the practical realities of what works in that arena and what doesn’t,” he says. “I value his no-nonsense approach.”Print: A Launching Pad for the BrandA video message on Ascend Media’s Web site asserts that it is no longer enough to just publish magazines and journals, and describes the need for additional content in areas like online, trade shows, custom publishing, etc. Bishop feels strongly that they don’t have a choice, their audiences are demanding it.“Any media company’s success hinges first on its audience. Our audiences, even business audiences, are constantly evolving,” he says. “They expect their information to reach them in lots of different ways on a variety of platforms.” An example of this is one of Ascend’s health care titles, Pharmacy Times, which Bishop explains is a brand, not just a magazine. “The Pharmacy Times audience looks to the print magazine, sure, but they also rely on a regular e-newsletter to hit their e-mail boxes, and they rely on the brand to help them out with continuing education in the form of webinars,” he says. “And they visit the Pharmacy Times Web site with increasing regularity to connect them to others in their community.”Wall says, “Yeah, it’s not like we—or any other smart media company for that matter—made a strategic decision to be more than print publishers. It’s just a necessary way to respond to the needs of all of our audiences and, consequently, our advertisers.”According to Bishop, advertisers are responding the same way.“They create a broader marketing mix because they know their audiences are in more places than just print,” he says.So the question that is often asked: Is print yesterday’s news?“We love print, and I still think print is the touchstone of most of our brands, but it’s a launching pad for everything else that is part of the brand,” Wall says. “If you’re just print, you’re not a well-rounded player in this game. And you probably don’t have much of a future in media.”All About AcquisitionsThe big question: How do you go from 120 employees and $25 million in total revenue to 480 employees and $120 million in revenue in just three years? They both point primarily to their acquisition work as the cause of the massive growth.“There are a lot of great media companies, and we admire everyone’s individual path for achieving success, but when we strategized the Ascend Media portfolio, we envisioned a company with clean lines, very distinct industries served,” Bishop says.And Wall makes sure the company serves those industries with strong brands across many platforms including print, online, live events and education.“So, for example, medical and health care has been one of those critical industries that we identified early on ....” Bishop says. “We’ve surrounded that market with print and electronic media alternatives, plus we even offer continuing-education expertise, as well as a solution for all of those medical associations who need media surrounding their conferences and trade shows.”Its Allied Healthcare Division in Los Angeles publishes 15 titles. “We acquired them at the beginning of 2005, and they finished that year with about $67,000 in electronic media sales ... online advertising, e-newsletters, that type of thing,” Wall says. “In 2006, they increased their electronic media sales revenue to more than $1 million—in one year.”They attribute this growth to a new division president who rallied the sales force around a strong focus on e-media sales.So as the portfolio continues to evolve, they are managing it more strategically. “It makes the process of building a company frustrating sometimes because there’s often a lot out there to buy, but we’re not in the market for just anything,” Bishop says.However, Bishop and Wall pride themselves in the acquisition work they have completed. “We’ve completed four acquisitions since March 2003, and one of them, the acquisition of Medical World Communications at the beginning of 2005, included such fractured divisions that it was like making four separate acquisitions all at once,” Bishop says.Digital Challenges Despite their amazing successes, the duo still faces other challenges on a daily basis. According to Bishop, “digital velocity” (as industry association American Business Media recently termed it) is one of its biggest.“We’re constantly evolving to serve our audience’s needs, and it’s tough to keep up. It demands financial investment and training and, frankly, new ways of thinking for entire segments of our team,” he says. “But I suppose it’s comforting to know that my counterparts at other media companies are facing the same challenge.”Despite the challenges, Ascend currently is having the most success with e-newsletters, webcasting and even podcasting in some markets. So what does Ascend Media have its publishing eye on?“More refinement of our product line, continued focus on the profile of our portfolio, more acquisitions. And not to keep banging the e-media drum, but the diversity of revenue streams is a huge part of any media company’s future success,” Bishop says. “And we’re talking near-future … our world isn’t just going to change, it’s changing right now.” PE

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Ascent by Acquisition

Jim Calder

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Jim Calder