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BREAKING NEWS & VIEWS

Glam Media Raises $50 Million: Keeps Reins on Pay
Wednesday, February 3, 2010
Steve Smith

One of the fastest-rising stars in the Web media firmament in recent years has been lifestyle site and blog network Glam Media, and that star just rocketed further upward. Glam has closed $50 million in private equity mezzanine funding. This is certainly one of the biggest funding rounds for a Web content company since the recession began last year. The company says its North American business was EBITDA profitable in Q4 while the global business was EBITDA break even. CEP Samir Arora tells minonline, "Overall, Glam continues to buck the trends, growing revenue from advertising at 35% or higher.” Nevertheless, Glam continues to keep in place some of the pay cuts it instituted last year as a hedge against the recession.

According to Glam, the funding will be used in part to create a Digital Media Technology Center and to explore new styles of brand display advertising. It plans to invest in new markets globally and start new vertical content channels. Glam Media already has the main Glam portal for women’s content, a Brash.com site for men’s content, Glam TV and Tinker.com, a service for publishers that lets them aggregate and monetize Twitter feeds. Glam will also do strategic M&A.

Last year Glam instituted executive pay cuts and moved a portion of employee compensation to a "variable pay" schedule that tied some of their pay to company revenue performance. According to Arora ,some pieces of that model are changing for 2010. "Just because Glam raised money, it is not changing the tight way it manages its operations and business," he says. "For 2010, the employee variable 10% pay is no longer there. Executive reduction changes from 40% cuts to 10-15%. CEO comp remains 20-25% reductions. These will remain in place until we are comfortably out of the economic slowdown, and Glam will continue to revisit these frequently."

Glam Media was founded five years ago on the proposition that Web audiences were fragmenting away from major portals and major media and toward niche verticals like blogs. The company has aggregated and curated thousands of user-generated sites along with syndicated content from major service media to form its large network of 72 million unique users in the U.S. alone.

If you have breaking news to share please contact Steve Smith at ssmith@accessintel.com

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