A Brief History of Spend Matters — Where We Are Today; Where We Might Go Tomorrow (Part 1)

It's approaching the end of the year, and I'm tired. It's been a long slog on the road this year, recruiting and managing an awesome team, speaking at over a dozen conferences and client events, visiting sponsors, advising a handful of remaining consulting clients, and drinking in a combination of dodgy establishments and starred Michelin restaurants with potential patrons. But thanks to these efforts, the Spend Matters Empire continues to grow and we're finally (gasp!) a real business. Now we're up to seven core FTEs and a number of other affiliated businesses, bringing the total number of full-time team members to 10 -- plus a bunch of contractors, friends, partners and detractors, of course, who are involved in the business as well.

Counting the various media properties, our total size/revenue will nearly double this year. The current lineup is: Spend Matters, MetalMiner, Spend Matters UK, and Healthcare Matters. And last year, we acquired Aptium Global (parent of MetalMiner) for a number of highly strategic reasons. Ultimately reporting to -- and having my expense reports approved by -- my wife, who was a shareholder in the venture and is now CEO of the parent company, was not one of these considerations. But more on that later.

In the meantime here's some background on how we got here: In 2004, I started a consultancy called Azul Partners. Some might say I was inspired by my five-year tenure at FreeMarkets to replicate the success we had created on the thought leadership and strategy fronts, combining elements of corporate development and strategic marketing together on a "hired guns" basis. But in reality, I figured I could make as much as I was doing previously in about half the time required to put into the venture. In short, I re-entered the consulting world because I was lazy. That, and my wife told me she wouldn't quit her job (then at Deloitte) unless I quit first. I took the bait, as history will tell. But my, how fast the original plan deviated from its initial inception!

That summer, Kevin Brooks (then the head of corporate communications at Ariba) and I launched a plan to start a blog that would end up being a new, opinionated voice in this market. I can't recall if we were just working off a Cabernet fog or were divinely inspired by the caffeine pulsing through our veins at a great coffee shop in the Mission district in San Francisco, but the idea was hatched, thanks to Kevin's inspiration and some great Arabica beans. Spend Matters officially launched that fall and provided some beer money in early advertising revenue thanks to Kevin convincing his colleagues that social media would truly be the next thing (and this was 2004!). But not much happened in the initial days.

We'd monitor the traffic. One day, a few weeks in, we hit 50 unique visitors -- a stunning success. Then 100, 200 -- and so on. But it took time to build a solid following. The business model only ended up being truly independently viable a few years into it. And without question, it took someone like me: who is verbose, tenacious, opinionated and a speed-writer to a fault, to make it work, at least without hiring additional resources ahead of revenue.

Yet despite the long hours, a strange thing happened in this timeframe. I began to really like the blog, personifying the thing. I would tuck it in at night and change its diaper, editing and re-editing what I had written earlier in the day for the next morning's posts. I would review the flame comments (we had lots of those in the early years) saying I was a shill for one provider or another. I remember one particular exchange with the founder of Ketera that kept me up for a few nights at the time. Another time, I remember a phone call from someone I still respect greatly in this business saying "how could you criticize the work of analyst X?" I told him I respected the analyst, but that the individual in question should have been ashamed of putting his name on the work that represented his research and his firm.

With age, I eventually learned to walk away from Spend Matters after a certain hour of the day. But that took about six years to happen.

I calmed down, at least partially, after those early days. And then all of a sudden, the thing really began to take off just as the print world was imploding. It was a perfect storm of activity and I was relatively surprised how fast it happened. Purchasing magazine died because its parent company was too stupid to see the asset it had on its hands (let alone the team) that could have been repurposed into a high growth, high margin business like Spend Matters. Other old-line publications committed ritual suicide one-by-one, even though some (miraculously) remain, despite content quality that has headed in only one direction, dismally down. All of a sudden, our advertising was oversubscribed. I was able to consult less and write more, focusing on what I really enjoyed.

A long-time friend and analyst described us at the time as the "People Magazine" of procurement. I chuckled at this, knowing that we had much more up our sleeve than met the eye. But my wife, who loves People as much as the Economist -- we are a two subscription household -- realized that it was better to be the popular, high circulation rag as a foundation to build a new media business than a niche, heady publication. And what came out of this -- our future strategy -- was born.

Jason Busch

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