Q&A: How Callaway has turned around TheStreet.com
David Callaway is the chief executive officer of TheStreet.com, a financial news company launched in the 1990s.
He joined TheStreet in 2016 after the company had experienced years of losses and increased competition for readers of news about the stock market and investing.
In the past two years, Callaway has overhauled its operations, laying off staff and selling one subsidiary, RateWatch, for $33.5 million. He has also focused more on putting some of its content behind a paywall to boost revenue, and added personal finance coverage. The company reported a net profit in 2017, the first time since before the financial crisis.
The stock price has more than doubled in the past year. TheStreet’s shares opened Wednesday at $2.11. A year ago, the shares were trading at 88 cents.
Callaway, formerly the editor of MarketWatch.com and USA Today, spoke by email with Talking Biz News about his last two years at TheStreet. What follows is an edited transcript.
What attracted you to joining TheStreet.com two years ago?
I loved editing USA Today for four years, but the opportunity to run a public company, and from my hometown in New York and in a subject area I know well from my years at MarketWatch, was too good to resist. Plus, the chance to work with Larry Kramer for a third time.
What were the biggest issues it faced?
TheStreet was losing money and had a shareholder structure that made it very difficult to take any extraordinary actions. Getting back to profit and streamlining our shareholder base were both keys to getting the stock moving again.
You’ve had to lay off some staff and restructure the editorial operations. How did you determine that?
It’s never easy to cut jobs, and particularly for me, journalism jobs. But it was essential to help us get back to profit. Fortunately, we’ve been able to hire some great new journalists as well, so our reporting and exclusives continue to get better.
You said a year ago that you wanted data-driven content. How does that manifest itself?
One of our businesses is a data business – BoardEx, a corporate LinkedIn. It tracks more than a million names of board members and senior executives at public companies around the world, but it’s magic is that it has a proprietary software that tells the user who he or she knows who knows the executive being searched. It’s great for lead generation for bankers and lawyers, who we sell it to.
But we can use the data to do stories on board makeups and corporate governance, which we do on our other news business, The Deal, and sometimes TheStreet when appropriate. In data journalism, it’s great to own your own data.
What new coverage areas are TheStreet and The Deal focusing on?
Bread and butter for TheStreet is equity news, investing news, technology news, and personal finance/retirement news. On The Deal, we focus on the major players in the M&A, private equity, bankruptcy, and corporate activism industries.
Why did you decide to sell RateWatch?
RateWatch was a strong performer for us for more than a decade. It was a non-core asset though, and it made sense to sell it so we could focus on our two main business segments of institutional news and data, and consumer investing news and analysis.
You’re putting more content behind a paywall. What content will remain free?
Like most others in the space, we’re experimenting with expanding our paywall to capture more subscribers and lessen our reliance on digital advertising. For now, plenty of our content on TheStreet will remain free, especially since the free site is a top driver to our subscription offerings.
Has the paywall decision begun to manifest itself in more subscribers?
Yes, I noted on our second-quarter earnings call last month that new orders for subscriptions have climbed for five months in a row.
How has the restructuring of the preferred stock help TheStreet move forward?
It streamlined our capital structure and gave our board more flexibility in developing strategies for growth. The stock has responded, as you can see.
Who do you see as your biggest competitors going forward in terms of investing and personal finance coverage?
Investing and personal finance falls into our coverage on TheStreet, so largest competitors in that segment would be the usual suspects, Seeking Alpha, MarketWatch, maybe Motley Fool.
What do you hope to accomplish in the next year or two years?
We’re aiming to pivot even more to our premium subscription business while continuing to improve our journalism, and to maintain and expand the growth we’ve enjoyed on our institutional side. All while providing profit to our shareholders.