How Shane Smith Built Vice Into a $2.5 Billion Empire

2014 Brand Genius winner for media

By now, you’ve no doubt heard about Vice’s humble beginnings. It’s 1994 in Montreal, and three guys—Shane Smith, Gavin McInnes and Suroosh Alvi—decide to launch a free punk magazine called the Voice of Montreal. Two years later, the magazine drops the “o,” changing its name to Vice. By 2014, the operation—having since relocated to New York and now known as Vice Media—has become a platform-spanning news and entertainment group valued at more than $2.5 billion.

Photo: Sasha Maslov

What that brief history doesn’t convey is just how unique a company Vice is. At a time when many legacy media organizations are struggling to stay afloat, Vice has found that magical point of convergence where good journalism, positive cash flow and (most elusive of all) the millennial attention span meet.

In the past year alone, Vice Media has launched a full-fledged news division, announced plans for a 24-hour news network and raised $500 million from investors A&E Networks (“It cannot be underestimated their ability to reach a very hard-to-reach audience,” says A&E CEO Nancy Dubuc) and venture capital firm Technology Crossover Ventures. For the company to have reached this point is largely due to CEO Smith, who has emerged as Vice’s tatted-up chieftain.

The way Smith sees it, there’s little about the Vice formula that’s magic. “We look at it very simply. We want to do three things. We want to make good content, we want to have as many eyeballs as possible see that content, and we want to make money so that we can keep paying to do that content,” he says.

Vice Squad | Vice's brilliant edgy content has made it a hit among elusive millenials. Photo: Vice Productions

Not only has Vice mastered those things, but it has also managed to do so without losing the countercultural cred that made it a hit in the first place, first among X-ers, then among the coveted millennial demo. On a given day, features provocative headlines like “I Went to a Blowjob Bar in Bangkok, Thailand” and “We Asked Drug Addicts to Rate the Music at Copenhagen Central” alongside news about unrest in the Middle East.

Yet far from scaring away advertisers, Vice includes among its clients the likes of Google, Levi’s and Intel, all of which have created branded content with Vice. According to Smith, Vice’s ad inventory is sold out on every platform, including its booming YouTube channel, across the next eight months. “Even when Vice was at its craziest and most zany and salty, we were still 50 percent ads,” says Smith. “I think that the skill lies in getting the brand what they want, which is brand lift, while also getting the content that we want out there, rather than the content that [brands] want or that everybody thinks that they want. Our success lies in finding brands that are sophisticated enough to realize that they should sponsor that content.”

Smith himself is known for being provocative, whether by announcing his intention to build Vice into “the next MTV, ESPN and CNN rolled into one” or by calling the competition (in this case, Gawker) “a bunch of bitches.” But it’s that same disdain for PR-friendly cautiousness that makes Smith such an effective leader, says chief creative officer Eddy Moretti. “I think [Shane] sees the media world, by and large, as a system that suffers from a bureaucratization and standardization of something that should be the most beautiful, human, cultural artistic thing,” Moretti says. “At the core of Shane’s vision is that if he holds onto that, he can cut through all the bullshit, and the company can continue to grow without losing sight of the secret behind its success.”

View the Brand Genius winner class of 2014:

Paul Crandell, GoPro | Mark Crumpacker, Chipotle | Michelle N. Fernandez, Canon USA | Camille M. Gibson, General Mills | Trudy Hardy, BMW of North America | Matt Jauchius, Nationwide | Quinn Kilbury, Newcastle Brown Ale | David Melançon, Benjamin Moore & Co. | Shane Smith, Vice | Dana White, UFC 

@adweekemma Emma Bazilian is Adweek's features editor.