Death By Overfunding: Glam Media

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After raising an enormous amount of money over a decade, Mode Media, formerly Glam Media, finally gave up fighting the uphill battle of trying to run a vertical ad network and content platform that could be scaled while being profitable and relevant.

Glam Media’s Journey

Brisbane, CA-based Mode Media was founded in 2003 as Glam Media by Apple and NetObjects veteran Samir Arora, Fernando Ruarte, Dianna Mullins, Raj Narayan, Ernie Cicogna, Vic Zauderer, Rebecca Bogle Arora, Susan Kare, and Emmanuel Job. It operated a media discovery engine that connected people with others based on common interests. Glam Media focused on curated fashion and lifestyle content and attracted a large female audience. Samir’s thesis, which at one time made a lot of sense, was to accumulate a large segmented audience and then monetize it through high-end brand advertising.

It raised millions of dollars to compete with digital giants like DoubleClick and Condé Nast initially, and in the later stages, Facebook, YouTube, and Yahoo’s Tumblr. In 2011, it bought DIY social network Ning for an estimated $150 million in the hope of pushing up its traffic of monthly unique visitors from 200 million to 240 million. I never understood this particular move. It was counter to Glam’s sharp vertical focus, and I remember frowning when it was announced.

But it was not just these giants that it was competing against. As programmatic advertising became the preferred way of online advertising, it had to veer away from its core competency which was to work closely with advertisers on high touch brand advertising campaigns.

To gain a wider market reach, Glam Media re-branded itself as Mode Media in 2014 and also expanded its services to include programmatic, video and native advertising and other verticals including home-focused Tend, men-oriented Brash, and Foodie.

However,  other publishers were adapting faster and its traffic continued to decline. According to a comScore report for February 2016, Mode Media was the tenth largest digital media property in the country with a following of 137 million unique monthly visitors while in 2015, it was the seventh largest digital property with 150 million unique monthly visitors.

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More investigation and analysis of Unicorn companies can be found in my latest Entrepreneur Journeys book, Billion Dollar Unicorns. Unicorns will also be discussed with some special guests during our 1M/1M Roundtable programs over the next few weeks. To be a part of the conversation, please register here. The term Unicorn was coined in a TechCrunch article by Aileen Lee of Cowboy Ventures.

Sramana Mitra is the founder of One Million by One Million (1M/1M), a global virtual incubator that aims to help one million entrepreneurs globally to reach $1 million in revenue and beyond. She is a Silicon Valley entrepreneur and strategy consultant, she writes the blog Sramana Mitra On Strategy, and is author of the Entrepreneur Journeys book series and Vision India 2020. From 2008 to 2010, Mitra was a columnist for Forbes. As an entrepreneur CEO, she ran three companies: DAIS, Intarka, and Uuma. Sramana has a master’s degree in electrical engineering and computer science from the Massachusetts Institute of Technology.

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