The Athletic receives new funding and a $500m valuation 

Alex Mather, co-founder of the subscription sports site The Athletic, infamously told The New York Times that his company planned to “suck (newspapers) dry.” Turns out, The Athletic is operating in an almost entirely different universe than traditional media companies. 

The company just landed $50m in Series D funding, Axios reports, bringing its total investment haul to ~$140m. The 4-year-old company is valued at $500m. For comparison: The Washington Post sold to Jeff Bezos for $250m in 2013.

Mather recently talked to us about how he built The Athletic and his future plans for the site. 

From a text file to reality

Mather still has a text-editor file saved from August 18, 2011, in which he jotted down a few thoughts on the state of sports media. Among his musings:

• Local newspapers were laying off expert reporters because of financial issues
• And the smart, flavorful coverage he enjoyed by Bill Simmons and his (now-defunct) Grantland site was focused on major national stories

“My local teams weren’t covered,” says Mather, who is from the Philly area. “I thought there was a big company to build.”    

More than 8 years later, this is how that company looks

• Nearly 1m subscribers who pay ~$60 a year
• An 80% retention rate for subscribers, most of whom come to the site via word-of-mouth
• A model where ~90% of total spending has gone to hiring 550 journalists

Other online news sites have received similarly flush valuations (VICE at $5.7B, BuzzFeed at $1.7B) before losing favor — and big money. But The Athletic investor Eric Stromberg said he expects the site to be profitable next year because of low consumer acquisition costs.

Want more insights on The Athletic’s rise? Read our full Trends profile.