Jan 5, 2015 · 15 minutes

Uber CEO Travis Kalanick has said when he has a tough day, he looks at his revenue graph. When I have a tough day and need inspiration, I reread sections of Katharine Graham’s autobiography, Personal History.

The beginning of Graham’s journey to become one of the most powerful, pivotal, and thoughtful women in the history of American Journalism started largely because of the family she was born into and who she married. Her father bought the Washington Post, and her husband Phil Graham later took it over.

It was only after her husband’s tragic suicide that Katharine Graham was thrust into the then uncomfortable position of becoming a publisher. It was her first real job and she didn’t see herself as qualified or confident. But her curiosity, her gut, her trust in her team, and thoughtful decision making shepherded the Post to a level of fame and size that it never reached under those more “qualified” men. Like most entrepreneurs, she excelled when she was out over her skis.

The book should be required reading if you run a media company, or if you’re a woman who runs pretty much any kind of company. Reading about Graham still grappling with her insecurities years after her unmistakable triumphs is interesting in and of itself. And there’s great stuff about work-life balance, betrayal, and rebuilding your life after love lost. But, for me, some of the best parts of the book are those surrounding the Washington Post’s reporting of Watergate.

We look back and remember Watergate as an epic coup for the Post. In fact, for more than a year, hardly any other media outlet picked up the story. The major players in Watergate simply lied through their teeth, and few of the Post's rivals had any interest in contradicting them. Until the Nixon tapes were released, there was no real evidence the Post was right. That was ultimately a lucky break, Graham says. In the meantime, The President of the United States actively sought to sabotage the Post’s business in retaliation -- at a time the company had just gone public and could little afford it.

For the longest time, Graham didn’t know the identity of “Deep Throat” or if the Post would ever be proven right. Yet, she supported her team even as she was personally blackballed from much of DC society. At one point she took all of the Post reporters’ notes into custody so that if served with a subpoena, she’d be the one going to jail, not her journalists.

While she aimed to take the high road throughout the scandal, there are some wonderful moments where the mask slipped. One of my favorite was an exchange with Clare Booth Luce-- the wife of Henry Luce, who started Time. Both Luces were extremely conservative and, although they had a professional friendship, Luce was unafraid to call out Graham for being "wrong" on Watergate.

In a major speech to the Newspaper Publishers Association, Luce said that she couldn’t deliver her prepared remarks, because of a dream she'd had the previous night.

I’ll leave the rest in Graham’s no nonsense prose:

“That night, [Luce] said, the spirit of her late husband, Henry Luce, came to her and told her to tell the truth about Watergate. She then attacked the Post for our reporting and for hiring “enemies” of the president. After the speech, I told a friend that Phil Graham had appeared to me in the night and told me to tell her to shove it.”
This is the brilliance of Graham’s leadership during a period where the company struggled mightily day to day but also cemented a reputation as one of the most fearless sources of journalism in the world. She didn’t go out of her way to pick fights, but neither would she be pressured to protect her friends in DC society if she believed they were wrong. Even if it almost cost her everything she, her husband, and father had built. And if a fight came to her, she sure as hell wasn’t going to back down.

That willingness to fight is what it takes to run a media company, no matter if we're talking about pages churning out of printing presses or words tapped into a Wordpress CMS.

And this is why so many tech moguls are failing as they try to make the jump to content.

Pierre Omidyar, Chris Hughes, and Evan Williams all have one thing in common. They admit to hating conflict.

Aversion to conflict is a surprisingly common trait in “disruptive” tech moguls. I’ve always found it ironic that the people who pioneered social technologies that have connected more than a billion people around the world are some of the most un-social people on the planet. These moguls are happy to disrupt the world-- from the other side of a screen, preferably via a “platform.” The platform defense is golden for these moguls, a get-out-of-jail-free excuse for taking any responsibility of things written or sold or bartered or happening on their multi-billion dollar properties.

Unfortunately, as these platform owners start fancying themselves as media moguls, they quickly discover that the news business doesn’t quite work that way.

For proof of this, you only need look at the challenges that dogged Omidyar and Hughes throughout 2014.

According to Vanity Fair, Omidyar was originally negotiating with Graham’s son Don Graham about buying the Post for $250 million. But his concern was that it was a legacy news organization that would need changes. And he hated confrontation.

From the piece:

Omidyar is admittedly conflict-averse, and when considering the Post, “I just remembered instances in my history where when people aren’t fully aligned, when they haven’t bought into the vision, it’s really difficult and it’s actually a little bit draining. It’s not something I look forward to dealing with in the morning. I thought about myself actually in the role of leading a cultural transformation—that would mean dealing with talented people who fundamentally disagreed with me in some cases.” When he imagined that scenario, he realized that he wanted to avoid it. “I said, O.K., fine, that’s maybe not a great idea.” He indulged a small laugh. “Ultimately I think sanity returned.”
OK points for knowing thyself, Omidyar. But that awareness that he doesn't want to fight only makes what happened next even more bizarre. Omidyar took that same -- somewhat arbitrary-- sum of $250 million and pledged to put it behind a new journalism effort that he staffed with several of the most combative and controversial journalists in America.

How on earth could anyone as objectively brilliant as Omidyar not see that there’d be some conflict inherent in that job? Let’s take the hire of Matt Taibbi, one of Wall Street’s fiercest critics. One of two things was gonna happen, even if all had gone well. Either Omidyar was going to have conflict with other billionaire friends who were uncomfortable with Taibbi’s reporting or he was going to steer the publication away from that kind of stuff, and risk a fight with the staff. In reality, the conflicts were so great it never even got to either point. Taibbi quit before publishing a single word.

A conflict-free world in a growing or meaningful content business simply doesn't exist. On the best days, media moguls have a choice: Internal conflict or external conflict. If you try to please the external world -- sources, investors, or advertisers -- you're going to infuriate the journalists who work for you, creating internal conflict. Eventually that will spill out publicly, causing an external fight as well.

The name of the Vanity Fair article says it all about how much confrontation Omidyar has been hit with: “Can First Look Media Make Headlines That Aren’t About Itself?

An eerily similar account is behind the more sudden and surprising unraveling of the New Republic late last year. When I interviewed Hughes on the PandoMonthly stage he said all the right things a tech titan turned media mogul should say. He talked about how this wouldn’t be a Silicon Valley style “up and to the right” company. He hoped for it to be profitable and sustainable, but he wasn’t gunning for a New Republic IPO. This chapter of his life was about making a difference and helping revive one of the most venerable magazines in the country.

Sounds like a media owner I’d like to work for. A lot of the New Republic's staff probably felt the same way.

Fast-forward more than a year to the magazine’s unraveling. Inside accounts paint a sad scenario where Hughes goes from dream mogul owner to losing the respect and trust of his team. Lloyd Grove wrote a thorough blow by blow, days after. Note this same familiar theme:

Tensions have been building since the summer. According to multiple sources, Hughes came to think of his writers and editors as “spoiled brats,” and especially disliked the flamboyant, feud-prone, white-maned Wieseltier, who was more than twice his age. Much of Hughes’s distaste was telegraphed in his body language; he strikes many TNR staffers as passive-aggressive and averse to confrontation.
Media reporter Ryan Lizza has been particularly outspoken about Hughes non-confrontational management style.

On Dec. 5 he Tweeted:

At least the king in the Red Wedding had the balls to stab everyone in person.
And on Dec. 7 he Tweeted a screenshot of a chat with a New Republic staffer. Responding to Hughes’ statement that the “vast majority of our staff remain. They are eager and excited to build a sustainable and strong New Republic that can endure,” the staffer wrote “Needless to say, Chris took the liberty of speaking on behalf of a staff he hasn’t spoken to in months with that last line there.”

Lizza’s account in The New Yorker painted a picture of an owner who was close to the staff until they disagreed, and then went silent. One example:

But in the late summer, numerous current and former staffers told me, differences between Hughes and his editorial team about the direction of the magazine began to widen. During a meeting with newsstand consultants who were advising T.N.R. on how to sell more copies, one of the magazine’s editors said something disparaging about The Atlantics covers. Hughes yelled at the editor, “The Atlantic sells a lot of newsstand issues and we have to respond to the data!” Hughes wouldn’t talk to the offending editor for two weeks, and their relationship never recovered.
One account of the breakdown is particularly, well Un-Graham. It’s was Hughes own moment of picking internal conflict over external conflict, and it doesn’t end well. Amazon threatened to pull advertising because of a critical cover, and Hughes wouldn’t let the editorial team make the email public. Confrontation with unhappy staffers is one thing. But refusing to confront openly and in front of readers a relationship with an advertiser is something else. The email was leaked to a reporter at another organization who called Hughes about it. As Lizza describes it, Hughes couldn’t forgive the team, and rather than confronting this feelings, he pulled away further from the team.

Medium's Williams and Amazon's Jeff Bezos are the other two obvious examples of tech moguls, turned media owners. We’ve yet to see either Bezos -- fittingly, the new owner of the Washington Post -- or Williams forced into the kind of fights that have bedeviled Hughes and Omidyar.

Medium has been producing some enviable original journalism of late, but Williams is so risk averse that he simply won't -- or maybe can't -- decide if he wants Medium to be seen as a publication or a platform. The most interesting content is siloed off into the Matter brand, which does have quality editorial leadership. Meanwhile Williams has done a better job -- so far-- at Omidyar's stated goal of wanting to support real journalism mostly by staying out of the newsroom and building a series of tech tools for writers. Still it remains to be seen whether he can continue to avoid having to stand by anything that appears on his site.

As for Bezos, he made the smart move of acquiring an existing newspaper, with an existing editorial structure and process for dealing with conflict. (Ironic, since conflict was the reason Omidyar gave for passing on the Post.) This has bought him some time, but inevitably, as the paper's owner, he'll be dragged into a fight, just as Graham was. Given his willingness at Amazon to have very public fights with authors, publishers, Wall Street, and the rest of the world, it's a safe bet that Bezos will be comfortable suiting up for those battles.

These days, I rarely hold TechCrunch's Michael Arrington (disclosure: a Pando investor) up as a bastion of doing the right thing. After all, this is someone I fired from Pando’s board back in 2012 for directly acting against the interests of Pando and our readers. But the reason I respected Mike during the golden era of TechCrunch, the reason I worked for him, was that he managed to balance cozy relationships in the Valley with a “go fuck yourself” attitude.

For Arrington, it was less about a reverence to journalism’s past. He routinely tipped old media's sacred cows, celebrating “process based journalism” and believing it was totally cool to run a venture fund called Crunchfund while still editing TechCrunch. But like most great media owners, he would not be told what to do  by anyone -- and that included by friends, prominent VCs, or advertisers. The only group I saw him consistently listen to was his editorial team.

One time Arrington wrote a negative piece about American Express, and their agency emailed threatening to pull ads from Techcrunch. That exchange was, of course, the next thing Arrington gleefully published. The sales team could only shrug. There was another time my reporting lead to a threatened legal battle with one of the biggest names in the Valley. Arrington had my back in a way many old media editors hadn’t in my career, telling me that no matter what, when we're right, “We don’t settle or retract things.” It was Arrington who taught me you publish all legal threats. Publish details of almost any fight, in fact. Let readers decide. The message to advertisers trying to pressure editorial is clear: A fight with us is a fight with our readers too.

This is why journalism is so exhausting. This is why journalists are such a nightmare to manage, or even have at a dinner party. They turn combative on a dime because that's the only way to survive.

Mike may have gotten a lot of things about journalism wrong, but this one he got right: The duty of a media owner is to readers first, following very closely by a duty to support their team. All other confrontations are survivable as long as you do right by those two groups.

In an age of blog fights it’s easy to twist this acceptance of confrontation into picking silly, even sometimes staged fights in the name of driving traffic. That’s not what I’m talking about. Such stunts are sugar highs of traffic: they disrespect readers and they do very little for long-term growth.

The fights I’m talking about-- the Graham style ones-- are ones that don’t particularly drive a ton of traffic and may cost you immediate advertisers or investors. Usually they are fights brought to you, not by you. This past year, Pando has had several threatened lawsuits (and other far more personal threats) which have cost more than a hundred thousand dollars to defend against-- money we didn’t have budgeted. We’ve absolutely burned bridges with investors, advertisers and business partners in the process of having those fights. And, generally speaking, they've done nothing to increase traffic month-on-month. But we’ve created change, we’ve been right, and we’ve never backed down. That, to me, is the what Katharine Graham teaches every media owner, or would-be mogul.

The fates of old media and Silicon Valley have been intertwined since the Web began. The chapters of this relationship have twisted and turned with Journalism’s alternating panic that Craigslist was destroying its lifeblood of classified revenues, that Google had destroyed endemic readership, and that blogs had destroyed credibility and traditions. Meantime, Silicon Valley long looked down on content as something messy, hard to quantify, impossible to algorithm, and hopelessly intertwined with human-powered labor.

But it seemed this time last year, as if that relationship was entering a new post-panic phase. That maybe all that money made off the Web’s disruption of old media could be used to save it. That billionaires like Jeff Bezos and Omidyar and near-billionaires like Hughes really did care about media, and had the gargantuan disposable income that gave them the luxury to care.

After a decade of blaming the architects of the Web for destroying their cushy several hundred thousand a year corner office magazine jobs and lucrative syndicated column gigs, the giants of old media started to believe these tech moguls were salvation. If you can’t work in an organization with a business model that supports huge newsroom, big budget journalism, the only other option is to work in one headed by someone so rich that he doesn’t care about that fiscal reality. As First Look Media's Glen Greenwald recently put it:

Everything about [First Look's] the Intercept is structured so as to make clicks and traffic from vapid posts totally irrelevant. We don’t sell ads, or subscriptions, or generate revenue of any kind. That’s why we do none of the things that websites typically do that have the primary purpose of generating clicks.
And it’s not as simple as saying that Omidyar or Hughes don’t care. It’s not that they lied when they said those things early on. No one made them spend their money on these missions. They could have certainly made more and had less grief spending it elsewhere.

It’s that, for all their good intentions, they didn’t possess the one thing you really need to run a media company: A willingness to live in a place of constant confrontation.

[Illustration by Brad Jonas for Pando]