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Insiders say once-buzzy Quartz is on track to lose money again this year as it faces a subscription shortfall

Insiders say once-buzzy Quartz is on track to lose money again this year as it faces a subscription shortfall

12.9.2019

Insiders say once-buzzy Quartz is on track to lose money again this year as it faces a subscription shortfall

A new membership program is less than halfway toward its 2019 goal, according to insiders, who added the company is on track to lose money this year.

Mike Theiler/Reuters This story requires our BI Prime membership. To read the full article, simply click here to claim your deal and get access to all exclusive Business Insider PRIME content. Buzzy business news startup Quartz made headlines in July 2018 when it sold for as much as $110 million to a Japanese media company at a time when other digital media companies were selling for a fraction of their announced value. A year later, several key leaders have left Quartz and insiders say a new membership program is less than halfway toward its 2019 goal and that the company is on track to lose money again this year. On the ad revenue side, its bread and butter, native advertising, isn't that special anymore as it's become table stakes for publishers. The company's co-CEO said Quartz was doing fine and that membership was showing"steady progress." Click here for more Prime stories. Quartz, a quirky but admired business news startup, made headlines in July 2018 when it sold for as much as $110 million to a Japanese media company. It was a win for digital news at a time when other online media companies were selling for a fraction of their announced value. Quartz's new owner, Uzabase, was little known in the US but its founder Yusuke Umeda expressed no shortage of ambition, he wanted Quartz to help NewsPicks, his news aggregation app that's little known in the US, compete with Facebook and Twitter. Read more: Ev Williams' Medium has hired a veteran publishing exec as it seeks to grow paid subscriptions, stirring speculation it's trying to take on Apple News The two companies came from different places. Quartz was built on a free, ad-supported distribution model, and was rarely profitable under its former owner, Atlantic Media. Its new owner was a publicly traded company and saw Quartz as a way to expand its digital subscription model. A year later, several key leaders have left Quartz, and insiders say it's on track to miss its new membership program goal and lose money again this year. Membership has fallen short of goals Two months after the sale was announced in July 2018, Quartz named an experienced journalist, Sam Grobart, to figure out the journalism that would drive a new membership program. The program launched a mere two months after that, alongside a US version of NewsPicks that featured big-name business execs like Richard Branson and Roger McNamee, in an effort to create a safer online conversation alternative to Twitter. The $100 a year (increasing to $150 in year two) membership program was pitched as a suite of extra benefits above and beyond the site's daily, free content. Members get exclusive content such as subject-specific deep dives called Field Guides and the ability to have contact with other members at events and access to journalists on conference calls. Internally, the goal was to get 20,000 members by the end of 2019; multiple sources said as of this summer, it was less than halfway there. While the company sought new revenue from membership, the core business had its own headwinds. Quartz, which lost $7 million in 2018 (it Read more: Business Insider

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