Henry Blodget Is in the Middle of Another Tech Boom, With a New Product to Sell

By
Image
“I think we’re in a golden age of journalism.”Photo: Ethan Hill/Ethan Hill

Henry Blodget heads for the staircase of his office building, a neo-Romanesque beauty in the Flatiron District that, back in the 19th century, was home to the largest publisher in the world. These days, it is occupied mostly by startups, including Blodget’s business-news site, Business Insider, which moved into the eighth floor last year and, soon after, annexed the seventh. “We have grown a hell of a lot this year,” says Blodget, bounding down the stairs. With his long legs, he could do two at a time, but Blodget is too much of a gentleman for that. At 49, he exudes well-bred Wasp; it’s shocking he was never cast in a Whit Stillman movie. 

Dodging traffic in his suit and loafers, Blodget heads for the 4/5 train to go down to Wall Street, his stomping ground back in the 1990s, when he was a star analyst famous for wildly optimistic predictions about tech stocks, including one about Amazon that turned out to be right. Others, not so much. After the market crashed and he was caught privately trashing tech companies he’d publicly boosted, Blodget was banned from the securities industry for life. Now the tech industry is back, and Blodget is warmly welcomed at the New York Stock Exchange, at least to film his weekly spot on CNBC’s Squawk Alley.

Inside, a makeup artist goes to work powdering his freckles. “It’s so strange to see you here versus Cannes or Nantucket!” says a producer, sweeping by to give him a brief of the day’s topics. The first is a dense paragraph from Reuters, headline: “Intel serves up revenue, profit beat as data-center business grows.” Scanning it, Blodget effortlessly spits out the BI version: “The real story is, Intel is still heavily dependent on the PC business, and the PC business is in the tank, so they are starting to diversify.”

Next up: Neil Young’s announcement that he is pulling his music from streaming services because of poor sound quality. “He’s a cranky old man,” says Blodget. “Not to get all academic, but that is one of the hallmarks of disruptive technology. They’re not as good, they’re just good enough. People hear disruptive technology and they think, Oh, someone invented something better. Actually, no. It’s usually worse. But it’s cheaper, faster, and easier, and it gets better over time.”

He could be talking about his own site. Back when Business Insider launched in 2007, it was a cacophonous mess of aggregated news, wonky analysis, and beery first-person essays. The tone, which Blodget says derived from his time as an analyst, was imperative. Every headline promised THE REAL STORY or facts that would BLOW YOUR MIND. Market updates were accompanied by pictures of female cleavage.

But it was fast. Often faster than legacy publications like The Wall Street Journal. And while some critics groused that it dumbed things down, many readers appreciated the lack of anecdotal foreplay. “It is actually more respectful,” says Blodget. “Your time is valuable.” It was good, or at least good enough. “Were we better than some of these amazing print publications?” Blodget asks about his and other digital upstarts. “In the beginning, no. But we served a different need.” With backers like Kevin Ryan of Gilt Groupe, Jeff Bezos of Amazon, and venture capitalists like Marc Andreessen and Ken Lerer, the site had more conflicts than Real Housewives. Still, it displayed its own sort of integrity, adding disclosures to posts like “I Asked Jeff Bezos the Tough Questions … and He Showed Why Amazon Is Such a Huge Success.”

This is a good time to say: Disclosure: Henry Blodget has written for this magazine. And, disclosure: Blodget approached this writer about a job in 2010, and she didn’t even respond, because she didn’t think Business Insider was really, as they say, a thing.

She was wrong. The advertising siege that followed the recession killed many respected publications, but Business Insider survived. Not only that, it grew. In January, Business Insider raised $25 million, at an estimated $200 million valuation. Now the nakedly clickbait headlines they pioneered are commonplace, and the site is regarded as a template for new-media companies with no print legacy or email service. “Business Insider won,” says James Ledbetter, whose Slate-affiliated business site, the Big Money, folded in 2010. The company now has offices on the West Coast and London, and 300 employees, mostly digital natives straight out of school. In the weekly inspirational speeches he gives while standing on his desk, Blodget humbly shares inspirational wisdom from the likes of Bezos, who he says told him: “Be proud, but recognize that what you built is this little flame, and all around you are huge winds threatening to blow it out.”

Now they are launching a spinoff: Tech Insider. Like Business Insider, the site will focus on a niche — tech geeks — while also trying to appeal to a larger audience with posts about “where tech meets life.” “Basically, change is accelerating at a phenomenal rate and affecting every aspect of life,” says Blodget, heading to a café near his office. “This is why we walk down the stairs at the office. Because everything I read tells us that is better for us than riding down the elevator.” A post like “8 Horrible Things Excessive Coffee Drinking Can Do to You,” which BI just published, will sit alongside articles like an account of what life would be like on a Mars colony and a “picture narrative” about pet-cloning in South Korea. “People love pictures,” says Blodget. “Period. Full stop.” He orders an iced tea, because coffee.

One imagines that being able to generate love at the click of a button is particularly intoxicating for Blodget, who is still “deeply scarred,” he says, “by what I went through with the bubble burst.” Back then, there were few blogs and no Twitter, but “the media was still capable of turning people into piñatas,” he points out.

Now he is the media, which appears to be at the center of another boom. Over the past 12 months, media companies like BuzzFeed, Vox, and Vice have raised more than $700 million to fund expansions of their news businesses. Blodget is confident that these are not signs of a bubble. “If you look at the valuations, they’re elevated, but it’s nothing like it was,” he says. “For a while people thought, Oh, $300 million is the high-water mark for digital forever,” he says, referring to the amount AOL paid for the Huffington Post. “CNN is worth $11 billion. There are going to be digital-media companies that are worth $10 billion in ten years, 20 years.”

As he said, change is accelerating at a phenomenal rate. One thing that hasn’t changed is his ability to make a bold prediction. “I think we’re in a golden age of journalism,” he says. “Digital advertising is growing fast, our revenue is growing fast, and I don’t see anything that is going to stop that shift.”

*This article appears in the July 27, 2015 issue of New York Magazine.