In what could begin an aggressive push to peel away Capitol coverage from shrinking major dailies, Minneapolis-based Dolan Media Co. today purchased Politics in Minnesota, the venerable insider tipsheet-turned-website. Sarah Janecek, who’s been PIM’s sole owner since founders D.J. Leary and Wy Spano retired in 2005, will remain as Dolan’s director of political coverage.
Dolan, a 1,200-employee company whose local titles are Finance & Commerce, St. Paul Legal Ledger and Minnesota Lawyer, successfully went public last August and has money to invest. It’s already started flashing cash: PIM will rent enough space in the Capitol’s basement pressroom for eight work stations and a broadcast booth replete with flat-screen TVs. “Nobody’s spent a dime there in 30 years,” Janecek quips.
For now, the snazzy space will accommodate PIM’s existing crew — all but one employee will move over and there are no big-name hires to announce. (Legal Ledger staff will also use the space.) Janecek says of Dolan Media Chairman, President and CEO James P. Dolan, “He bought everything and will keep everything going as is. We’ll figure out a new mix as we go, and we might blow something up if it doesn’t work.”
Dolan’s niches are lucrative
Dolan rakes in cash from lucrative legal, financial and real-estate niches. It’s not a pure journalism play — for example, law firms pay the company to service mortgage-default case files — but Dolan boasts the kind of operating profit margins newspapers used to: 30.2 percent in the quarter ending Sept. 30. The company went public seven months ago at $14.50 a share, reaping $140 million; its stock currently sits at $22.99 a share after topping $30 as recently as mid-January.
By purchasing PIM, Dolan clearly sees government as a fourth niche. It’s a target of some opportunity: Government isn’t getting any smaller, but newspaper staffs are. For years, specialty business publications have chipped away at the newspaper franchise, but no one’s made a well-capitalized run in the political/government sphere. Like it or not, there’s an affluent, educated market that earns a living off Capitol doings, or whose companies profit from the machinations.
Dolan — who worked for Rupert Murdoch for 15 years — is making money at a time when older ventures struggle and newer ventures battle-test new business models. He clearly found a kindred spirit in Janecek, who earned some flak a decade ago for putting ads next to government information in her Politics in Minnesota: The Directory. That fat tome — circulation 2,000 — is now a standard reference work for scribes and influence peddlers.
Writing about the Directory in the mid-’90s, I quoted the then-30-something Janecek as saying, “If I lose my ass, I’ll have time to recover.” Instead, she’ll receive a nice little wire transfer today.
More entrepreneur than journalist
Still, this deal will raise eyebrows. Janecek will be the first to tell you she’s not a journalist, but a well-connected, indefatigable entrepreneur who emerged from lobbying. (She did write briefly for MinnPost to get a taste of the professional journalism world.) Janecek’s staff is mostly green and hardly a replacement for experienced daily vets at the top of their game. Her website, God love it, has an eye-melting amount of underlined text, though Janecek insists back-end features are built for the long haul and the design can be easily upgraded. (PIM’s morning email of links is quite readable, by the way; 3,000 people get it.)
While she’s frankly a gas to hang with — we’ve known each other since we waited tables together in the early ’80s — and a moderate on many issues, Janecek frequently plays a Republican lightning rod. My eardrums still reverberate from high-decibel battles with “liberal” partner Brian Lambert on their former KTLK-FM radio show, and she famously earned Al Franken’s scorn for allegedly tarting up DFL outrages at Paul Wellstone’s funeral.
Janecek is PIM’s most visible writer, and the site’s free posts seem to lean GOP without Spano’s and Leary’s DFL counterbalance. (The weekly newsletter is behind a $100-per-year pay wall.) But she gets points for not trying to hide who she is, has lobbied for DFL-type causes and boasts plenty of DFL friends.
The challenge for Janecek
The key, frankly, will be using Dolan’s funds to flesh out her roster’s experience and undergird a reputation as an honest information broker.
As for Dolan Media, its journalism is regarded as workmanlike within the industry, and no substitute for the depth and influence of the best daily coverage. But the online world necessitates hustle — just ask Bloomberg — and I know from personal experience that Dolan reporters burn virtual shoe leather. When I edited the Downtown (Mpls.) Journal a few years ago, we prided ourselves on new condo development scoops; when we got beaten, it was usually by Finance & Commerce (or the Business Journal), not the Strib.
“We think it’s about the immediacy of good, high-quality info,” Janecek says. “I view Politics in Minnesota as a place for new stories in the conversation that are not appearing elsewhere, and if we do an analysis, that will be new to the conversation, too.”
The newly capitalized Minnesota operation will be the skunk works for a national network of directories and information. Amid the heady rush of a just-completed deal, Janecek has a hard time controlling her enthusiasm: “Jim Dolan just gave me the best job in the practice and business of journalism in the country.”