Dave Portnoy and Barstool Sports’ Secret Billion Dollar Plan

Barstool Sports is building the most valuable media company in the world.

I say that in a sensationalist tone to grab attention, but there are real drivers behind the sentiment that make it possible. The relatively small team has built a large, hyper engaged audience that continues to elude the media behemoths that precede them.

The Barstool Sports magic is driven by charismatic personalities, a cultural obsession with memes / humor, and a system level evolution in distribution platforms. Gone are the days of writing long form, serious content. The last five years have ushered in an acceleration of shareable, humorous content in reaction to the shift in consumer interests and decreasing attention spans.

The focus on “clicks” by media empires was once a recipe for success, but is now a bee line to negative unit economics and the inherent fall from grace that follows. Somehow a formerly small, unknown sports blog from New England avoided the errors of their idols and figured out the media model of the future.

So what exactly has Barstool Sports done to set them up for world domination?

The answer is more complex than you would think. I’m going to do my best to analyze the different aspects on an individual level, while respecting the fact that the true magic lies in the electric blending of the individual parts.

# Unscalable things: Just like any great startup, Dave Portnoy worked his ass off in the early days to get in front of anyone and everyone. He wasn’t worried about scaling to millions of readers. He focused on creating valuable content that made people laugh. Dave’s unique distribution strategies early on built the foundation for the engaged audience that Barstool enjoys today.

# Hyper engaged audience: Every media organization is racing to establish a trusted relationship with their audience in today’s digital age. They need an engaged audience because successful distribution on social platforms is predicated on users sharing, retweeting, liking, and favoriting content. The more engagement a piece of content gets, the more distribution it gets. Barstool is set-up better than almost any other media company to take advantage of this phenomenon.

# Authentic content: A hyper engaged audience doesn’t just appear out of thin air. It is created by establishing trust over a long period of time. Barstool’s audience rewards them with trust and engagement because of the unusually authentic content that is created. What other media company has employees Facebook Live their walk to work? How about show up to football games with a bus to party? Or protest the NFL by arriving at NFL headquarters with picket signs? This level of authentic content is nearly impossible to replicate and creates a highly defensible moat for the band of Barstool bloggers.

# Humor: The team’s effort would be a waste of time if they weren’t actually funny. They’re weird and goofy. They have a sick sense of humor. It resonates with hundreds of thousands of people across the world. Media companies who can’t make fun of themselves moving forward are going to struggle heavily.

# Advertising: By mixing humor and authenticity, Barstool is able to create engaging advertising content that is nearly impossible to copy. Whether it’s yelling “Leesa Mattress” 50,000 times in 3 minutes or holding a Totino’s cook off, the team has found the magical intersection of valuable content and advertising dollars.

# Operational excellence: Dave knew he couldn’t do this alone. He made a brilliant decision to partner with Peter Chernin and The Chernin Group. They brought in Erika Nardini and the rest will be history.

# Monetization: Every media company is struggling to make money in the new paradigm of social distribution. They’re trying everything from controversial adverts to event-based business models. Barstool has an exploding physical product business that drives significant revenue. This non-traditional revenue channel is being copied by the likes of BuzzFeed, among others. Simply put, Barstool makes money which makes them sustainable.

It’s clear that Dave Portnoy has built Barstool Sports into a major player in sports media. Everyone knows that what gets you here, won’t get you there though. My prediction is that the new intellectual horsepower behind the company will pull off three legendary moves:

  1. They’ll push Dave and his band of bloggers to cover non-sports content. Barstool had impressive engagement for their election night coverage. It probably helped that the team “called” every state hours before CNN, Fox News, MSNBC, etc. This horizontal expansion of content will broaden their audience and allow them to hire additional charismatic personalities.
  2. Barstool will recreate almost every incumbent monetization channel for the social age. The best example is Pay-Per-View. The company recently streamed an amateur boxing match to over 12,000 paying subscribers on a shoe string budget. As they build out their tech, Barstool will replace PPV for the common man in a narrow vertical of content. This type of technical and creative innovation not only deepens the relationship with their audience, but also drives compelling revenue.
  3. The most controversial prediction I have is that Barstool Sports will evolve into serious journalism. Yes, I think guys named Big Cat, Trent, El Pres, and PFT will build a bridge between their young, relatively male audience and serious issues like politics, technology, and science. The company and personalities won’t sell out to the suits. They’ll instead create coverage of these topics in a unique, Barstool way. If they’re able to pull this evolution off, you’re talking about a company that will have transformed from boys in their parent’s basements to the most valuable, powerful media organization in the world.

The journey of Barstool Sports has been riddled with obstacles. They’ve successfully overcome each one. The future will be increasingly difficult, but the company has the right ingredients in place.

Barstool Sports — the most powerful media company in the world.

That has a really nice ring to it. I just hope that Dave doesn’t get scared and sell the company too early because he can’t handle true greatness.

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