An Interview with Rich Antoniello
New media pioneer, Rich Antoniello, shares with us what it takes to capture today's millennial attention & how to maximize overall reach while maintaining a niche-first strategy.
Rich is currently the CEO of Complex Networks, a 50/50 Joint Venture backed by Verizon and Hearst. Rich was previously a co-founder of Complex Media, which was sold to Verizon & Hearst for a reported $300m (approx.) Complex Media properties include Pigeons & Planes, Sole Collector, Complex TV, First We Feast & Collider. Overall, the properties under the Complex Networks umbrella generate more than 500 million videos views a month and have a combined social following of over 75 million users.
Kyle Widrick: Kyle Widrick here with the Creator Series. We have Rich Antoinello. Thank you Rich for being here.
Rich Antoinello: Thanks, thanks for touching me. I appreciate that.
Kyle Widrick: Rich is the CEO of a joint venture between Verizon and Hearst called Complex Networks. Previously he was running Complex Media, which sold for a reported 300 million, as [inaudible 00:00:18]-
Rich Antoinello: I can't comment on that.
Kyle Widrick: Reported ...
Rich Antoinello: It's a very ... we had a very nice exit, and a very nice amount of dollars that came in to continue to build our business. We've been consistently profitable since 2010. Basically, if you think about it, we decided to not just build a gigantic audience-driven business. We decided to build a brand, which a lot of people who decide to build brands basically do large scale audience plays and blow profitability off. And then there's people that grow businesses but that don't have brands. Right? So that they're not very flexible.
We decided that you have to do both. You have to build a brand that is also a business, and a business that is also a brand. And by doing that you're holding yourself accountable to basically self funding all of your initiatives. So you better be able to have an audience that is portable, and then multiple monetization revenue lines that are correlated to it.
Kyle Widrick: And you consider each of your separate properties their own brand?
Rich Antoinello: It's a multi-brand play that is aggregated together across the board. That's foundationally part of our business. The whole philosophy is we're looking to dominate youth culture. Right? And if you think about, previously, 20 years ago, MTV as a music brand dominated youth culture as a singular brand. That will never happen again. 'Cause everybody talks about, you have to go find the consumer. You have to talk to them where they are, how they are, you have to have appropriate content for each platform.
Well, my viewpoint is take that a step further. You have to think about it, if you're gonna have a super deep connection with consumers, you absolutely, fundamentally need to start from a vertical interest point basis and have the most authentic, incredible content within that.
And if you have that against all of youth culture's new interest points, right? So, whether it's gaming or hip-hop or sneakers or anything as generic as even sports and sports lifestyle, the bottom line is you have to go from the vertical interest point, make it relevant on a horizontal basis and, ideally, if you're able to aggregate and put together all of the different vertical interest points, you can cross pollinate, and you can also walk in to an advertiser and say, look at the scale that I have. It's literally coming from the deepest connection possible with the consumer and you're getting all the scale that you would get with the bug guys, where you're getting the deepest connection possible, as well.
Kyle Widrick: Talking about going deep, you went deep early on in video, very big in video. Leader in video.
Rich Antoinello: That's right.
Kyle Widrick: Did you make that decision early, or how did that happen?
Rich Antoinello: We were actually a little late on the decision, to be honest with you. We just played the biggest game of catch-up that you've ever seen. No, it's true. I mean, literally because of our financial discipline.
You know, video used to be very expensive. And we broke even in 2010, like I was saying before. So if you think about how expensive video was in 2010 and how bad the monetization was and also people weren't paying for content yet, visual content on a large scale basis, we were testing very small.
And then in 2012, we got very aggressive into video. But you think, like, YouTube was already, I don't wanna call it a mature platform 'cause it's still maturing, but we really had very little scale on YouTube at that point. We really, all of our video scale happened on our own platform. And video, by nature, is distributive.
So, we were like, okay, what are we gonna do, what's the white space in the marketplace, what do we dominate and how can we own a conversation? So at the end of 2012 we launched Complex News, which basically is, again, a little bit of an homage to MTV News, which kind of like fell off completely.
We launched Complex News and by launching Complex News, we exploded out of nowhere. Within one year, we went from, literally, four million views to 95 million views.
Kyle Widrick: Wow. That was 2012?
Rich Antoinello: That was the end of 2012. But we wanted to, basically, be the purveyor and give the most important opinion of what is going on in pop culture and help define that. And nobody was really doing that. And what we really did is find this amazing niche and that just exploded for us. And that was the foundation of video for us.
Kyle Widrick: Take us back, 'cause I know the story a bit, but Marc Ecko is your partner, you have Complex Media. This is back in two thousand-
Rich Antoinello: Well, it's a really long story. Complex Magazine, which we launched with first and it was literally just a magazine.
Kyle Widrick: Print magazine.
Rich Antoinello: A print magazine. Which was, right, a print magazine. You have to specify that, now. It was a great concept. It was all about organizing subcultures. What I found brilliant about the concept of that, even though the execution of the magazine, originally, was pretty poor, I found very exciting is, it was the concentric circles coming together. And, again, that all sounds duh now when we all talk about the way the world has changed, but previous to that people had not realized that the subcultures used to be on the peripheral of the influence, and then the mass was in the middle.
And now, by the time 2005, 2006 rolled around in the beginning of social networks really exploding, the subcultures in the peripheral had moved to the middle and the top of that pyramid and the only way to be relevant to the masses is to own that part of the conversation. It's almost like trickle-down influence. Right? Instead of trickle-down economics?
So I go to my partners at the time, Mark and Seth, Seth [inaudible 00:06:07] and Marc Ecko, and at the end of 2006 when we broke even, I'm like, good news bad news. Good news is we broke even and way faster than the plan was. The bad news is I'm not gonna start paying you back. My equity in this was sweat equity. They put the capital in. We're not gonna start paying you back. We were projected to make a couple million bucks in 2007. But I'm like, I need every penny to launch into digital aggressively.
And if you think about what the marketplace looked like in '06, '07, it was portals, ironically AOL and Yahoo. Right? And then on the other side you had kind of, for lack of a better terminology, shit-bag ad networks, right? That just didn't make any sense, that were out their scale, no exclusivity, no real value proposition.
So we had ad networks and we had portals. Right? So, the opportunity, in my viewpoint, was the internet really is an on-demand thing. Right? If you really think about it, it's on-demand. Right? 'Cause you get to go and search for what you want, you get to consume it how you want and it's an amazing thing.
So, I didn't understand how a portal is an on-demand service 'cause it's everything to everybody. It didn't make any sense to me. And these ad networks were really advertising vehicles [inaudible 00:07:27] business plans that were reverse engineered for scale. They didn't take the consumer in the depth of the conversation people were having. It was all about “uniques” and reach and reach and reach.
So my viewpoint is, look, we have this about all these subcultures. If you think about all the sections in the magazine, there were sneakers and it was music and it was gaming and it was fashion and style. And I'm like, we can go and organize all of the best-in-class sites that represented each of those. Not the biggest, not just numbers, but who was writing the best content that were forcing the conversation, that were starting the conversations that meant everything to youth culture.
So if you think about it, Complex.com was the physical and theoretical manifestation of all of those different verticals.
Kyle Widrick: [inaudible 00:08:12]
Rich Antoinello: Right.
Kyle Widrick: Got it.
Rich Antoinello: So, we launched and then, amazingly, social networks happened. When people talk, I think they actually don't really fundamentally understand how social networks work. They are not-
Kyle Widrick: Let me pause for a second. You were outlied with a portal online before social networks existed?
Rich Antoinello: We were out-
Kyle Widrick: Just so people understand.
Rich Antoinello: Yeah.
Kyle Widrick: Before Facebook, this is before-
Rich Antoinello: That's right.
Kyle Widrick: The proliferation of that side [crosstalk 00:08:41]
Rich Antoinello: The proliferation of, right, right. I mean this was like, before even the height of Myspace. And it wasn't really a portal. What we really were was a collective. I don't even wanna call it a network, even though we called ourselves an ad network.
Kyle Widrick: A collective of leading voices.
Rich Antoinello: A collective of leading voices-
Kyle Widrick: Different verticals.
Rich Antoinello: Of key related verticals that were all about the interest points that were the most influential, differentiated interest points. We didn't have sports at the time, we didn't do lowest common denominator stuff.
That was the beginning, by the way, of the deterioration of print. And it was also the beginning of the deterioration of viewership of sports programming. So, the younger kids watching less football, less baseball. Right? And like, what are they doing? Well, they're doing these different interest points. Right? We had launched. We exploded out of nowhere. I mean, the digital portion just, it was the right thing at the right time.
And then you saw the proliferation of social networks really come about. And if you really think about social networks, I think it's really important to understand something; most people think it's like a whole bunch of verticalized communities. And it is, but if you think about what really, from the media perspective, what the opportunity is for brands, if you really think about what the opportunity of social networks is, fundamentally, it's verticalized content that cuts across communities.
If you think about the ALS Challenge, or anything that's ... a meme, a GIF, things that cut across and dominate the conversation, it's not the communities, it's the verticalized content that cuts across those communities that's the magic of social networks.
Kyle Widrick: This is how your brain works, obviously. But do you map this out and say this talks to this, this is vertical, this is horizontal? How do you do that?
Rich Antoinello: 100 percent. That's a great question. I think about it like a dock. Right? The deeper you drive a piling into the ground, into the water, the further you can go out without the dock tipping into the water. So the more verticals and credibility you have, the more horizontal you can go without losing your credibility. It's a balance. Right? So there's the juxtaposition there.
But even within the verticalized pieces of content, you have to think about, if we do a hip-hop story, if we do a sneakers story, that juxtaposition needs to happen down at that level. If we do a story about why Air Jordans were the first lifestyle sneaker, like crossed over from sports to lifestyle and defined the sneaker community, that needs to be told so my mom can read it. Right?
So we need to be definitive resource. You can't just be an echo chamber. I think we've learned that lesson in the election, right? Like, if you take a vertical voice, if you take a vertical topic, you have to make it horizontal by nature from an expertise perspective without losing that authenticity and credibility. You take a horizontal topic, you want to take a vertical viewpoint on it and from an angle perspective. Right?
So, that happens at the article of video level, and that also needs to mirror itself from 45,000 feet the way all of it comes together as a business as well.
Kyle Widrick: If we fast forward, you sold, recently this past year-
Rich Antoinello: Yep.
Kyle Widrick: Easy process, tough process, did it come together quickly? I know that Hearst was a partner of yours previously.
Rich Antoinello: We actually solidified everything in January of this year, of '16.
So, they were very interested. We had started talking to [inaudible 00:12:10] and Steve very early, about two years beforehand. A lot of interest in our business. And not just 'cause of the profitability of the business but more so because of the very differentiated viewpoint that we had.
And now when Verizon started getting very active in the marketplace from the media perspective, and right before our offer, Hearst and Verizon got together to form a joint venture which created an opportunity. And I don't wanna speak for them but I think they found us very attractive and decided to make an aggressive move, which worked out exceptionally fantastic for us because a lot of times, people talk about being sold as an exit.
I don't look at it as an exit. In fact, if anything, I look at it like it's an entrance. Right? Because we're going to a company, two companies, that we have resources, assets, leverage points, that can accelerate our business.
Kyle Widrick: Complex Networks [inaudible 00:13:10]-
Rich Antoinello: Yep.
Kyle Widrick: ... is a JV between Hearst and Verizon.
Rich Antoinello: Right.
Kyle Widrick: Within that lives the old legacy Complex Media.
Rich Antoinello: 100 percent.
Kyle Widrick: Has your lens changed as to what that scope looks like within this new vehicle?
Rich Antoinello: We closed our deal in July of this year. And then in September, we rolled together two other vehicles that had been launched in March and April of 2016. So, Seriously and Rated Red had been launched. Seriously is a vertical comedy play and Rated Red is an interest point driven red state play in the same philosophy as Complex always had, which is verticalized interest points. So whether it's ATV-ing, hunting, fishing, so on and so forth, very related from an approach perspective and dominating each of those vertical conversations and providing it to an audience that nobody else is catering to.
So, very similar ... The parallels are amazing, actually. Go back to the beginning, like we talked about, there's never gonna be another MTV. It's gonna be a multi-brand approach. So, if we're gonna dominate youth culture, we need to dominate all of youth culture. So how do you do that? You need multiple verticals that are all of the interest points.
Complex alone did not service everything. We would dominate the coasts and maybe urban areas and cities. But we needed other things, and by bringing in Rated Red fills out the middle of the country and the south. And you know, what the beautiful part is, is that the edge and the acerbic, new school nature of Seriously, it's a layer of humor that can cut across all of that. Right? So it kind of fits very nicely in from a strategic perspective.
I don't think the press does a good job of calling shit on media people, media CEOs, that they constantly talk about what they're gonna do and nobody ever goes back and calls shit on them and proves out. The one thing Complex has done, Complex and myself and any representative we've ever had, we've talked about what we've already accomplished.
So I think there's a little bit of an ire that comes from that, that like I'm a little bit of a curmudgeon or something.
Kyle Widrick: The proof in the results.
Rich Antoinello: Right. It's like, we talk about what we have done. Others talk about what they're gonna do and never actually do accomplish. But I do think I'm misunderstood. I think anybody who does know me [inaudible 00:15:27] or has worked with me, I'm kind of a little bit of a softy. If you're outspoken, people tend to jump to certain conclusions.
We're very aggressive and I tend to be very aggressive, by nature. Look, there's always a perception when you're very aggressive in a marketplace that people read it just for what it is on its face value. I'm not saying there's a difference between, I'm very aggressive by nature and that's part of my thought process, but how you go about expressing that to your staff and your team is very different.
Kyle Widrick: That aggressive, that passion, is that the trait that when you look at how you've been able to be successful-
Rich Antoinello: Yeah.
Kyle Widrick: ... and what drives you, what has been the catalyst for that?
Rich Antoinello: You know, it's kind of interesting. Everybody asks how do you describe yourself. For me, I'm all heart. Right? Like, heart's everything. And the way I think about it is this way; heart, instead of using a whole bunch of descriptors, is this culmination of ridiculous ambition, right?
Because you have this big passion. Like you wanna go out there and like, I'm all heart. Right? I'm gonna go for it, but it's you wanna go for it with a ton of respect and empathy. The way I look at it is I'm a little raw. Right? I'm a raw guy, I tend to be exceptionally emotional. So it's all heart.
Growing up, my dad was a UPS guy, my mom was a stay home mom. My father was like, listen, I'd kill myself, I'd break my back, literally, he was the delivery guy. Right? Not management or anything. And his viewpoint is there's no way that you're gonna do this for a living.
So to say my dad was focused or up my ass about things is the understatement of the year. It was 100 percent like, there's no way you're not going to be successful. So there was a lot of pressure in that way.
What's interesting is, because of my parents and their backgrounds, they didn't really know how to put pressure on me. It was just, well you've gotta do better in everything. I look for people who wanna do great things. It sounds very esoteric, but that to me is everything. It's not somebody who's got the perfect resume. And I don't mean just the perfect resume of where they went to school and where they worked before. I'm looking for somebody who comes in and it's like talent. Right?
Like, do you have a very aggressive stance from the way you approach things? And do you have a very creative thought process.
Kyle Widrick: Rich, thank you very much for being here.
Rich Antoinello: Thank you. Thank you very much, sir.
Kyle Widrick: Thank you for the knowledge.
Rich Antoinello: Thank you.