How a hedge fund manager launched a biz journalism media start-up
Jonathan Spitzer is the founder, publisher and editor-in-chief of CTFN, which covers mergers and acquisitions and major corporate news from a professional investor’s point of view.
Spitzer was a merger arbitrage research analyst for Arnhold and S. Bleichroeder Advisers from 1999 to 2005, and co-portfolio manager of the Merger Arbitrage Group at Arnhold and S. Bleichroeder (later First Eagle Investment Management), from 2005 until his retirement from active fund management in 2013.
He has an MBA from Columbia Business School and a B.A. from Yale in comparative literature.
CTFN, which launched in April 2014, has correspondents in Los Angeles, New York, London and Washington and those writers have previously written for publications such as American Banker, CNN Money, Yahoo Finance, Forbes, TheStreet.com and Mergermarket, among others.
Spitzer spoke by email with Talking Biz News about CTFN. What follows is an edited transcript.
How did you get the idea for CTFN? What does it stand for?
I had the ambition to launch CTFN because I felt that the coverage of mergers and major corporate events by the media was leaving out important levels of detail and insight, even among the other specialty, subscription based publications.
As a former hedge fund manager, I had been a client of many of these services, and I often had the impression that the reporting was disconnected from critical elements of the subject matter.
As for the name, we launched as Connecticut Financial News but quickly realized that readers assumed this meant our focus was on Connecticut. To us it was a polite way of saying “Hedge Fund Financial News.”
In any case, our focus is actually global. We report on issues in Australia, China, Brazil, and South Africa, among other places and of course on major corporate events in North America and Europe. So we ultimately shrank the name to CTFN hoping this would better reflect our reach as a news organization.
We hope that ultimately CTFN comes to signify for readers the highest-quality, best-researched news available on major corporate developments.
Why leave money management for journalism?
I was ready for a change after 14 years of doing the same thing. Fund management is a great career path and to leave it voluntarily is unusual, but I had graduated from Yale College with a degree in comparative literature and always thought that somehow I would be involved daily with the written word.
Also, after analyzing businesses for 14 years I thought I was ready to run one. I was a huge consumer of news as an analyst and then portfolio manager. It seemed to me that it would be a nice extension of the basic skill set of doing exhaustive research to try my hand at journalism. With the invaluable assistance of seasoned financial reporters, I felt confident that we could add value to the marketplace.
So CTFN was born.
What does CTFN provide that other business media weren’t providing to investors?
CTFN is trying to dig a little deeper, peel the onion another layer, probe a little more extensively than other media outlets while at the same time couching the information in a context that speaks to professional investors in their own language.
This is our aspiration and what we work toward every day, though we acknowledge that it is a hard goal and one that cannot be achieved at all times. Still, we believe that the body of work produced by our analysts and journalists together advances the market’s knowledge of details of several key corporate developments at a time.
How do you present news in a way that caters to investors?
My background is as an analyst and portfolio manager so as curator and editor of CTFN’s content — along with our research analyst who is also informed by an investment background — we hope to recognize what the next incremental important datapoint is that investors would care about, and then to present this to our former colleagues in the investment world in their own language.
You’re currently looking to expand your editorial staff. What will they be doing?
CTFN is seeking to expand its coverage of major corporate developments and to dig deeper into distressed debt, tax, and accounting. This is in addition to our coverage of mergers, which we would also like to expand. New hires right now would be tasked with researching and writing about major corporate events in this vein.
With a subscription rate of $3,000 a month, you’re only catering to high-end investors as your target audience, right?
Our readers are the large fund management companies who routinely use information providers at similar or higher price points.
Other than M&A, what types of news does CTFN cover?
M&A is at the core of what CTFN reports. We also report on important litigation, legislation, and major events for corporations. For example, we have reported on this issues at Valeant as well as the proceedings in the Fannie Mae/Freddie Mac cases. We also cover real-time court proceedings in significant litigation, such as the GE/Electrolux and Staples/Office Depot antitrust trials.
How did you fund the rollout of CTFN?
I initially funded the launch of CTFN from my personal savings. The growth of our client base has continued to fund our growth.
Is it profitable yet? What are your projections for the next five years in terms of growth?
CTFN has continued to grow each year, both in terms of subscribers and coverage. Based on our growth to date, we expect to grow significantly over the next five years and to expand into related verticals.
Who do you see as your biggest competitors in this space?
Our most direct competitors are subscription based news outlets such as dealReporter and MLEX. But at the end of the day any good financial journalism competes with CTFN no matter from where it comes.
Still, the CTFN team focuses all of our energies every day and every week on working harder to uncover facts that our readers should learn. We are investing heavily to produce the highest quality product possible.