Bustle Digital Group’s Bryan Goldberg is back with more M&A: In the latest prong in Goldberg’s roll-up strategy, BDG closed a deal to buy Nylon, the 20-year-old fashion, beauty, music and pop-culture media brand — the company’s seventh acquisition to date.
Financial details of the deal weren’t disclosed; the transaction comprises both cash and equity. Under the pact, Nylon’s previous owner — investor and real-estate magnate Marc Luzzatto — will become a minority shareholder in Bustle Digital Group.
“Nylon’s bold and colorful legacy has developed a cult-like status over the years,” said Goldberg, CEO and founder of BDG. “We’ve been interested in this property for a long time. We felt it was a natural fit for our portfolio. It’s a model of influential beauty and fashion brands.”
BDG plans to bring back Nylon in print — not as a monthly mag, but in special issues tied to “flagship cultural moments” like Coachella, Goldberg said. It would be Bustle Digital’s first foray into print publishing. “We view print as an extension product,” he said. “It’s impossible to think about Nylon without thinking about the magazine covers. Print is part of who Nylon is.”
Goldberg has attained a reputation for buying distressed media assets, aiming to combine them into a larger-scaled business targeting younger audiences. In the last two years, BDG has purchased the Zoe Report, Gawker, Flavorpill Media, Mic, The Outline and Elite Daily. Combined with BDG’s Bustle and Romper, the company’s brands reach over 50 million U.S. visitors per month, according to comScore. (In some cases BDG has vied with Penske Media Corp., the owner of Variety, in bidding for media properties, including Rolling Stone, which is now fully owned by PMC.)
Founded in 1999, Nylon is shadow of what it was in its heyday as a strong indie on the New York publishing scene. The print edition of Nylon ceased publication with the October 2017 issue and its 12-employee print staff was laid off. That came after investment firm Diversis Capital (co-founded by Luzzatto) bought Nylon in 2014 and merged it with FashionIndie.com, a fashion, beauty and lifestyle influencer network that was redubbed Socialyte.
Nylon.com’s web traffic has declined by one-third in recent months, from 1.4 million visitors in January 2019 to 950,000 in May, according to digital measurement firm SimilarWeb.
According to Goldberg, BDG plans to invest in expanding Nylon’s editorial team, including launching a print product, and growing its live-events business. “It’s a tough time to be an independent, or family-owned, magazine. But this brand has real strength,” he said. “We think it can be a premium brand for the next 20 or 30 years.”
Bustle Digital, in pursuing its roll-up model, has been able to better navigate the economic headwinds afflicting many companies in the digital-media and publishing sectors. This week, Condé Nast — paring back its portfolio to trim its cost base — sold fashion mag W to Future Media, a holding company led by Marc Lotenberg that will merge W with Surface and Watch Journal. Sara Moonves (daughter of ousted CBS chief Leslie Moonves) was named W’s editor-in-chief with the departure of longtime top editor Stefano Tonchi.
With the acquisition, BDG will extend employment offers to the roughly two dozen members of Nylon’s editorial and design teams, including editor-in-chief Gabrielle Korn. According to Goldberg, BDG will give the staffers coming over from Nylon raises. In the next few months, the Nylon crew will move into the BDG offices in Manhattan’s Flatiron district.
Nylon’s sale to BDG covers only the U.S. business and does not include Socialyte, the former Nylon Media’s influencer-marketing division. Most of Nylon Media’s sales and business staff will remain with Socialyte, according to Goldberg.
Former Nylon president Evan Luzzatto (son of Marc Luzzatto) will remain as a partner to BDG on Nylon’s international licensing business and will continue as chairman of Socialyte. Currently, there are nine international editions of Nylon magazine, published in Spain, China, Japan, South Korea, Singapore, Indonesia, Thailand, Germany and Mexico.
Goldberg said BDG isn’t looking to cut editorial costs at Nylon. The cost savings stem from having shared resources, including IT infrastructure, and having a single sales force selling advertising and sponsorships across all of BDG’s brands. He claimed revenue at Zoe Report, the fashion and lifestyle brand headed by Rachel Zoe, and Elite Daily, bought from the U.K.’s Daily Mail and repositioned from news to lifestyle topics, has grown by triple-digit percentages since his company bought them.
“Two years from now, we think we can get triple-digit growth from Nylon,” Goldberg said.
BDG is on track to bring in $100 million in revenue in 2019, according to Goldberg, and he expects the company to turn a small profit. Bustle Digital Group has raised about $80 million in funding from investors including GGV Capital, General Catalyst, Saban Capital Group and Social Capital. Goldberg, who started BDG in 2013, previously co-founded sports publisher Bleacher Report (sold to Time Warner).