In a Troubled Time, a New Business Magazine

In a Troubled Time, a New Business Magazine
By KATHARINE Q. SEELYE
Joanne Lipman, the editor of Portfolio, the new business magazine from Condé Nast, tapped gently last Monday on the door of David Carey, the publisher, and then burst into his bright Midtown corner office.

“It’s here!” she said, grinning and handing him a copy of the much-anticipated debut issue of Portfolio. Lush, photo-rich and thick with ads (185 ad pages in a 332-page issue), it’s an unmistakable stablemate of Condé Nast’s Vogue and Vanity Fair.

The cover photograph isn’t of John F. Welch Jr. or Bill Gates but a rooftop view of Manhattan, golden lights glowing in anonymous office cubicles — a homage to Berenice Abbott, who documented New York’s changing cityscape in the 1930s.

Mr. Carey beamed back. He then reached over to a side table and picked up a recent issue of Fortune, one of Portfolio’s chief competitors. The Fortune cover was particularly busy, with a crowd of anonymous Google workers in casual dress and a cover line announcing “The 100 Best Companies to Work For.” He held them side by side. His glow said no contest.

“We’re not giving you peas and carrots,” he said. “We want to capture the glamour.”

Between all those ad pages, readers will find business executives treated like celebrities and the kind of matching of writer and subject they might find in Vanity Fair: Tom Wolfe on hedge funds (with photographs by Annie Leibovitz); Betsey Morris on the Ford family; and Michael Lewis on “jock exchanges,” which trade in athletes.

Sheelah Kolhatkar writes about the handful of women who actually do private equity deals. Gabriel Sherman interviews Bruce Sherman, the reclusive Florida money manager who has invested heavily in newspapers.

“Business is about power,” Ms. Lipman writes in her first editor’s letter. “And guts. And passion. Business coverage should be too.”

Business is also about brains, and Condé Nast’s were certainly questioned when the company announced in September 2005 that it was putting out a business magazine — its biggest single investment in a start-up — at a time when many others were foundering.

Readers were still reeling from the bursting of the Internet bubble and corporate scandals, and investors were looking at constantly updated Web sites — not biweekly glossies — for an edge. And some sizable advertisers, like the Detroit automakers, were mired in slumps of their own.

Some of the big magazines remain troubled: ad pages for the first three months of this year were down for BusinessWeek (3 percent), Forbes (9 percent) and Fortune (13 percent), compared with the same period a year ago, according to Publishers Information Bureau. Circulation at the big three has been flat or falling for the last few years, according to the Audit Bureau of Circulations.

But Portfolio would not be the first business magazine introduced during trying times. Henry Luce founded Fortune just months after the Wall Street crash of 1929, for example.

S. I. Newhouse, chairman of Condé Nast, said in an interview that he had no patience with Portfolio skeptics.

“Damn the torpedoes and full speed ahead,” he said. “I don’t think we’re going to trample on Forbes or Fortune. I think we’re going to help the whole field. We’re going to bring excitement to it, and we’re going to bring luxury and fashion advertisers into it.”

Mr. Newhouse said that Portfolio had been inspired by a positive response to business articles in Vanity Fair and The New Yorker, although he could not recall precisely which ones. He also said he had not made the final decision to proceed until Ms. Lipman agreed in August 2005 to leave The Wall Street Journal, where she had overseen its Weekend Journal and Personal Journal sections and its Saturday paper.

Mr. Newhouse said that his reported commitment to the magazine of more than $100 million over the next five years was “something of a myth” because “we’re going to stay with Portfolio.”

Portfolio has hired more than 75 editorial people for the magazine, 40 for its Web site, www.portfolio.com, and more than 45 on the business side.

The business side, under Mr. Carey, the former publisher of The New Yorker, has been working Madison Avenue hard. After all, he has a reputation to uphold. During his tenure at The New Yorker, between 1998 and 2005, advertising revenue almost doubled and the magazine broke the 1 million mark in circulation. In 1996, Mr. Carey brought 210 ad pages to the first issue of the restarted House and Garden, one of the highest levels ever for a new magazine.

Portfolio’s first issue has drawn 53 business advertisers, 30 of which had rarely if ever advertised in a Condé Nast publication. The newcomers include Barclays and Pitney Bowes.

“Job No. 1 was to deepen the company’s penetration in the business advertising category, which the May issue achieved,” Mr. Carey said. Bringing more business advertisers in the door could get them interested in advertising in some of the company’s other magazines; at the same time, Portfolio provides a new outlet, and another affluent readership, for advertisers who already appear in those other magazines.

Portfolio was nearly two years in the making, a long time for journalists to go without ink. At least one who was hired has already left, sowing rumors of sagging morale. During the start-up period, competing publications have written articles that were rumored to be appearing in Portfolio, trying to steal its thunder, and articles at Portfolio were commissioned and killed.

Mr. Wolfe added some drama of his own, sweeping through Portfolio’s hushed glassy offices with a black cape over his white suit. His narrative was supposed to run 2,500 words but he submitted 11,000, since honed to 7,500 words. His is the longest piece in the magazine.

One of Portfolio’s most celebrated hires, Kurt Eichenwald, a former reporter for The New York Times, was to have been featured in the premiere issue. But his article, on terrorism, was held, according to people involved with the magazine, because Mr. Eichenwald deluged the magazine’s fact-checking department with thousands of pages of documents just before the article was to go to press last month. It is expected to appear in a later issue.

Holding it, these people said, was unrelated to a controversy involving Mr. Eichenwald that emerged earlier in March: the revelation that in 2005, while at The Times, he had sent $2,000 to someone who later became the subject of an article. (Mr. Eichenwald, who has said the money was repaid long before the article appeared, declined to comment for this article.)

Ms. Lipman declined to discuss the article but called Mr. Eichenwald “one of the finest investigative reporters there is.”

James Impoco, deputy editor at the magazine and a former Sunday Business editor at The New York Times, said that Ms. Lipman had “exacting standards.”

He said that “she knows what she wants and is pretty strong-willed.”

Mr. Impoco added: “I have to admit that I was a little worried after she saw ‘The Devil Wears Prada’ and told me she sympathized with the Meryl Streep character. But she turned out to be a pretty thoughtful boss.”

Ms. Lipman was almost giddy last week as she showed off a display of the magazine’s pages on the walls of a secured room. Portfolio’s goal, she said, was to “connect the dots” between life inside the boardroom and out.

“I love this kind of story,” she said, gesturing to a profile of Boone Pickens, the Texas oil tycoon whose son pleaded guilty last year to securities fraud. “It’s a great ‘King Lear’ tale,” she said. “He’s in his second act and his family’s disintegrating.”

The magazine is priced at $4.99 on the newsstand and is testing subscription prices from $12 to $22 for 12 issues. Its next issue is scheduled for late August, and it will appear monthly after that.

The magazine’s Web site, which will be free, will contain all the articles in the magazine and report breaking news, much of it by Portfolio writers. Chris Jones, the site’s managing editor, said its bloggers would post three and five times a day. The site has elaborately produced videos and various interactive features.

In conjunction with Condé Nast Traveler, the Web site will also tell readers things like the best place to make a deal in various cities, and which company’s employees like to stay in which hotels (in San Francisco, Yahoo likes the Clift, Mr. Jones said). For those readers headed to jail, portfolio.com offers prison advice: get dental work done in advance and don’t talk to the press.

Still, the magazine is at the heart of the Portfolio enterprise and while some skeptics remain, they acknowledge that Portfolio is well positioned.

“I don’t think they would make the same decision to launch a business magazine now because the climate has changed since they announced,” said Martin Walker, a magazine consultant.

But, he added, “you’re talking about a powerhouse publishing company, and they have a terrific database to get subscribers, they have all kinds of ad connections and they are spending enormous amounts of money.”

And there are signs of life elsewhere in business magazines. Fortune is putting out a redesign of its venerable Fortune 500 issue today with heavier paper stock (not as heavy as Portfolio’s) and may redesign the whole magazine. Forbes is planning a new business magazine, geared toward women. Portfolio has been raiding business publications for writers and editors, setting off an intense competition for marquee names.

Robert Safian, former executive editor of Fortune and now editor and managing director of Fast Company (circulation 755,000), said the entire business category was undergoing a reinvention.

“Business remains at the heart of our culture, nationally and globally,” he said. “The traditional business magazines have had trouble capturing and expressing that excitement in recent years, and the ad market has reflected that, but I think the tide is turning.”