In yesterday’s [March 24th] posting, I looked at the “Catholic Corporate Resurrection” at Crux with the assistance of the Knights of Columbus. I would like to delve further into the interview Laura Hazard Owen, deputy editor at the Nieman Lab, conducted with John L. Allen, Jr. and Ines St. Martin by looking at the business side of this unique partnership.
The discussion starts with Crux’s creation at The Boston Globe. According to Craig Douglas in the Boston Business Journal the local scene played a huge role, “Crux launched in September 2014 and marked one of the Globe’s first major product innovations following its $70 million acquisition by Boston Red Sox owner John Henry in 2013.” Douglas explains why the venture only lasted 18 months, “‘The problem is the business,’ [The Boston Globe Editor Brian] McGrory wrote. ‘We simply haven’t been able to develop the financial model of big-ticket, Catholic-based advertisers that was envisioned when we launched Crux back in 2014.'” Allen explained to Owen where the advertising dollars come from, “We’re mostly talking about Catholic organizations, Catholic universities, Catholic book publishers, and so on, that are interested in appealing to the Catholic market. And although that’s an important revenue stream, the whole problem we had at the Globe is that that revenue stream by itself doesn’t cover the whole operation.” Allen also told Greg Ryan of the Boston Business Journal, “’I’m a journalist, not an entrepreneur,’ he [Allen] said, but the Knights arrangement ‘is an endorsement of my totally naive instinct that there would be people out there who supported (Crux) and would be willing to do it.'”
Allen told Owen where the money from the Knights of Columbus will be spent, “The way it works is that they are giving us X amount of money, and then it’s up to us to decide how to allocate it in terms of salaries, etc. It’s not being administered on their side, it’s being administered on our side.” The number of salaries will be just a handful in the beginning Allen explained to Owen, “The changes we are making are more imposed upon us by financial reality than the nature of who is sponsoring us. At the Globe, we had a full-time staff of six people. Right now we have a full-time staff of three [Allen, San Martin, and business manager Shannon Levitt]. We hope to ramp back up in fairly short order, but in the short term, we are going to be a somewhat smaller operation.”
Now that Crux is an independent entity Allen and Levitt will be shaping the business model. The National Catholic Reporter and America are two well recognized Catholic publications that started well before the current media business culture became the reality. NCR and America are both non-profits which have subscribers but also accept donations. America also has the additional resources of the Society of Jesus (aka Jesuits) to support its mission. Allen explains to Owen that Crux cannot clone NCR and America’s structure, “If your business model is the classic journalistic model of paid circulation plus advertising, I’m really not sure you can sustain a successful niche publication in that way. I think you have to become a hybrid of the for-profit and not-for-profit models.” Allen provides further insight to Owen about his business vision, “To me, the business model is all of those things together: advertising, syndication, and sponsorship. That’s the prescription for a successful niche publication.”
Crux is separate from The Boston Globe and is now on its own. Allen and Levitt will be trying to maintain the site and generate fresh content on a tight budget with a limited staff and meager funds to pay freelancers. Allen is also on the lookout for additional sponsors, who once they emerge will allow for increased funding which in turn can lead to a larger staff. The ongoing saga at Crux will be a harbinger of things to come in religion media universe.