A Story on Gigaom's Fall

Re/code has a post they researched on the demise of Gigaom. http://recode.net/2015/03/14/the-long-story-behind-gigaoms-sudden-demise/

But, behind the scenes, Gigaom’s managers and investors had known the company was in serious peril for more than two months. And while they hadn’t discussed it publicly, its backers had been trying to fix the company for at least a year by pouring millions more into the publisher and swapping out executives.

The money was so short they couldn't host a Gigaom Structure Data schedule for this week.

Yet Gigaom needed even more money. Sources said the company wasn’t going to be able to produce an enterprise software conference in New York, which sold tickets for a list price of $1,255.50 and was scheduled for next week, because it didn’t have enough cash to pay vendors to stage the show. That kicked off the last-ditch effort to sell the business.

The area that Re/code focuses on caused the biggest losses was the Research group.

But Gigaom’s research business had actually become a significant drag on the company. While it had started out as a “pro” subscription business charging individuals as much as $299 a year, after a couple of pivots, the company’s research arm was now focused on creating custom white papers and other products, like Webinars, for corporate clients. While that group booked $8 million in business last year, it wasn’t profitable. That was partly due to high sales and product costs and but also because some of that $8 million never materialized as the company didn’t create the work it was supposed to. (Here’s a post from former Gigaom research head Michael Wolf, who says the company raised too much money to fulfill unrealistic growth expectations, and then mismanaged the money it raised).

Disclosure: I used to work freelance for Gigaom Research.  I decided in Dec 2013 to stop writing white papers and in June 2014 I stopped briefings and webinars. By Mar 2015 I was no longer actively working on any Gigaom activities other than being a speaker at Gigaom Structure in June 2015.