In a move to acquire an audience of Wall Street insiders, TheStreet announced it’s buying financial publisher The Deal LCC for $5.8 million.
The move comes as TheStreet, a digital media publication anchored by TV money guru Jim Cramer, tries to bolster its fortunes by reaching a more elite audience. According to the release:
The Deal’s marquee customer base of 40,000 professionals, including senior-level bankers, law firm partners, private equity partners and hedge fund notables provides substantial predictable recurring revenue with high renewals and attractive margins and has continued to grow despite the deep cyclical downturn in the M&A market.
On a conference call this afternoon, TheStreet’s Chief Executive Elisabeth DeMarse explained that her company’s prime focus in the acquisition was Deal Pipeline, a subscriber-0nly suite of analysis, research and articles. As reported by the Wall Street Journal, DeMarse believes TheStreet can tap Deal Pipeline’s lucrative subscriber base while shedding the acquired company’s legacy costs.
In practice, this means that TheStreet will immediately shutter the print version of The Deal and lay off a number of its journalists. The WSJ reports that TheStreet will integrate some of the remaining Deal staffers.
The Deal has been struggling for a while and has flipped back and forth between free and premium models.
Overall, the transaction appears to make sense at a time the market for business news has become more competitive. Upstart websites like BusinessInsider have grabbed millions of readers, while established publications like the Atlantic prepare to issue new business verticals. The acquisition of 40,000 top-shelf Wall Street readers may allow TheStreet to regain some of the mojo it has lost in recent years.