Company lived by the sword—and died by it.
I read a good column in the Wall Street Journal yesterday about Doubledown Media and its demise. Doubledown, in a very real sense, lived by the sword and ultimately died by it. It celebrated the kind of excess and greed that would have made Gordon Gekko [right] blush. It championed the bullying, any-means-necessary culture of Wall Street traders—the kind of culture that blinds people like ex-Merrill Lynch CEO John Thain to the profound immorality of their actions. (You remember Thain redecorated his office on company money, spending $130,000 on rugs and $35,000 on a toilet, among other things.)
In the end, as Journal columnist Thomas Frank points out, the super-successful traders weren’t financial geniuses, they were creators of a bubble that was bound to burst. And so Doubledown, which wrote about how to spend “unthinkable” bonuses, found itself unable to react quickly enough. It found itself reducing its magazines frequencies to quarterly, repurposing content across its magazines, desperately seeking new capital and enduring an inexorable death spiral over the last five months or so.
But it still kept up the lavish boxing matches and extravagant parties it became known for.
There’s a parallel here to the Industry Standard, the chronicler of the dot-com era, which itself became synonymous with the excesses of that era and crashed eight years ago—it was out of business a year after producing $140 million in revenue.
The Doubledown story is a story of a lot of things. It’s the sad story of a dream unrealized, the loss of jobs for good people. It’s the story of the collapse of a served market, and the demise of a company with some good ideas.
It’s the failure to effectively respond early enough in ways that could save the business, not decimate it on the way down, thereby ensuring the fate of the brands. It’s the story of hubris.