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Masters of Scale

How to save a magazine, with The Atlantic’s Nicholas Thompson

37 min episode · 2 min read
·
Nicholas Thompson

Episode

37 min

Read time

2 min

Topics

Relationships, Leadership, Marketing

AI-Generated Summary

Key Takeaways

  • Paywall optimization: Running 230 annual tests on paywall variables—adjusting rules based on referral source, story type, and user behavior—transformed subscription growth from flat to hockey stick trajectory, driving profitability after eighteen months of uncertainty.
  • Comparative advantage strategy: Thompson shifted from editor to CEO by identifying his unique strength wasn't writing or editing but building business models for journalism organizations—fewer peers compete in this space than in editorial excellence at elite publications.
  • AI licensing approach: Rather than only suing AI companies for scraping content, Thompson negotiated licensing deals with OpenAI while maintaining legal rights, positioning The Atlantic as a partner in building new internet economics versus stamping feet in frustration.
  • Talent retention framework: Combat Substack defection by optimizing what organizations uniquely provide—copy editing, fact checking, SEO reach, network access—while allowing independent projects, making journalists feel leadership protects their interests daily versus competitors offering higher individual earnings.

What It Covers

Nick Thompson explains how he turned The Atlantic from losing $20-30 million annually to profitability with 1.46 million subscribers through paywall optimization, running 230 tests yearly, and strategic AI licensing deals.

Key Questions Answered

  • Paywall optimization: Running 230 annual tests on paywall variables—adjusting rules based on referral source, story type, and user behavior—transformed subscription growth from flat to hockey stick trajectory, driving profitability after eighteen months of uncertainty.
  • Comparative advantage strategy: Thompson shifted from editor to CEO by identifying his unique strength wasn't writing or editing but building business models for journalism organizations—fewer peers compete in this space than in editorial excellence at elite publications.
  • AI licensing approach: Rather than only suing AI companies for scraping content, Thompson negotiated licensing deals with OpenAI while maintaining legal rights, positioning The Atlantic as a partner in building new internet economics versus stamping feet in frustration.
  • Talent retention framework: Combat Substack defection by optimizing what organizations uniquely provide—copy editing, fact checking, SEO reach, network access—while allowing independent projects, making journalists feel leadership protects their interests daily versus competitors offering higher individual earnings.

Notable Moment

Thompson discovered his twelve-year plateau at two hours forty-three minutes in marathons stemmed from a mental block about exceeding his pre-cancer speed, not physical limits—breaking through at age forty-three after his father's death.

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Episode Transcript

As a founder, you're constantly wearing multiple hats, usually at the same time, but the most successful leaders have learned to hand a few of those hats off to the right people. That's where Upwork shines. It's a one stop shop to find trusted freelance talent across IT, web dev, design, and admin support. And it's built to be simple. Register for free, connect with freelancers who match your style and pace, and hire them with industry low fees. Upwork makes the whole process easier, more affordable, and way less stressful. If your business is ready for that next level, Upwork has the talent to help you get there. Visit upwork.com right now and post your job for free. That's upwork.com. Upwork.com. This is fun, by the way. Thanks for having me on. Thrilled to do it. Did you run up here by the way? I was gonna run, and it's, like, a little like, then you stink during the interview, and it's, like, not great. Yeah. I should've done that. I just Should've done that. You wanna rerack? You can Yeah. Yeah. But can we can we reschedule this for 11:30? I'm gonna go home and run. Nick Thompson didn't run to the studio for our interview, but he runs almost everywhere else. He runs marathons, ultra marathons, and most days, he runs to work at his job as CEO of the Atlantic. When you saw subscriptions actually drop, was there a moment where you had a crisis of conviction about this? Totally. I was terrified. You gotta have incredible talent at every position. It's like this is a huge push. There are fires burning when you're going out. Can you believe it? You're such an idiot. And then you go back to, this is totally gonna be amazing. So I have no idea what to do. I'm sorry. We made a mistake. But you have to time it right. Oops. Unfortunately, I have a three bedroom apartment. Stuff that just seems absolutely not balls. Ten years later, I'm like, well, that's just how you do it. We have to say just how you do it. This is Masters of Scale. I'm Geoff Berman, your host. This week on the show, Nick Thompson. He's the author of a fantastic new memoir called The Running Ground. We'll get into his running life later in the conversation, but first, I wanted to speak with Nick about his day job. He's the CEO of The Atlantic, and he's leading an extraordinary turnaround at the iconic magazine. Nick, welcome to Masters of Scale. I've been looking forward to this conversation for a while. You are now the CEO of The Atlantic. Why take on the challenge of turning around this iconic American institution? So a couple things are important that somebody who just looks at my resume or just sort of knows me from my Twitter handle wouldn't know. One is that when I graduated college when I was young, I didn't intend …

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