Doubledown Media Goes Under

Doubledown Media built a stable of magazines on the rise of Wall Street and financial excess. And as the economy collapsed, Doubledown’s model proved unsustainable.

Capping months of mounting financial troubles, CEO Randall Lane told employees in a memo that the company, publisher of Trader Monthly, Dealmaker, Corporate Leader and Private Air, would cease operations immediately after its bank stopped providing working capital.

Lane wrote that advertisers and other business partners owed the company a “substantial seven-figure sum,” but that a slowing of payments prevented Doubledown from paying its bills.

“These are unprecedented times: the combination of the media depression, the Wall Street implosion and the credit slowdown were collectively too much for our company—probably any company in our shoes—to overcome,” Lane wrote.

Doubledown had other obstacles, as a young company with a short track-record and a controlled-circulation publishing model. Some media buyers question that model, because the magazines’ recipients, although they have to qualify to receive the issues, don’t pay for them.

Despite a $7 million infusion over the years from its backer, Jim Dunning, Doubledown in recent months cut 12 employees or about 23 percent of its staff; and lowered the frequency of its titles to four from six times a year.

Other titles dependent on luxury advertising also have had to trim their ambitions as consumers have curtailed spending and marketers of expensive baubles and fashion have cut their ad budgets.

Back in December, Niche Media Holdings folded Atlanta Peach, one of its luxury-ad filled city magazines that are delivered free to high-income households. The company also cut staff last fall.

Mark Edmiston, managing director of media investment bank AdMedia Partners, said that while all luxury magazine publishers are facing tough times, Doubledown’s ownership situation left it more vulnerable than Niche, which is backed by the well-heeled Greenspun family; and Modern Luxury, which is owned by private equity fund Clarity Partners.

“It’s a bad environment for everyone, but they had a single backer in Jim Dunning, and they’re in a category where the bloom is off that rose,” he said.