PR firms are paying tech journalists at prominent publications for links
For as long as journalism’s existed, businesses have offered cash payments, gifts, and services in exchange for favorable coverage. (It’s one of the reasons we’ve been working on an ethics guide at The Hustle.)
Now, a recent exposé by our friends over at The Outline argues that this trend has turned into a lucrative, bustling enterprise in the digital age.
PR agents are offering big bucks to staff reporters and contributors at Forbes, Huffington Post, Entrepreneur, and Inc. in exchange for dropping a single link or mention to a client in an article.
It’s called “payola” journalism
Say a PR agent is tasked with getting his client mentioned in a prominent publication. He can do this the ethical way, by shooting out hundreds of pitches, or building rapport with journalists. Or, he can simply pay to play.
The person above, who we found in our Facebook feed, is selling coverage of a company in his “major publication.” To be clear, this is not an ad or sponsored content opportunity: It’s an offer to write a seemingly “genuine” news article about a company in exchange for money.
The underground economics of payola
According to The Outline, PR agents offer anywhere from $500 (HuffPost) to $1.2k (Forbes) to journalists for a covert mention.
There are even whole PR agencies, like ArticleHub, that rely entirely on crooked journalists: they’ll charge a client a high sum for guaranteed placement (i.e. $4.5k for a TechCrunch mention), then pay a shady writer a few hundred bucks to drop it in.
Often, the clients these PR agents represent aren’t even aware their “organic” mentions were paid for.
Why’s this a big deal?
We’ve seen this pay-to-play system take form in nearly every facet of media: in the radio world, record companies illegally pay stations for air time without proper disclosure -- and influencers have come under increasing heat for not clearly marking their brand sponsorships.
This system is not only damaging to readers (who rightfully expect unbiased news), but also to the companies who work hard to actually earn publicity.
Ethics? Who’s that?
The personal assistant of Goldman Sachs’ co-president stole $1.2m in wine from him
The former personal assistant to Goldman Sachs #2 David Solomon now faces federal charges for “borrowing” some really rare wine from his boss.
The defendant was arrested for stealing hundreds of bottles of wine, including 7 bottles of highly sought-after vino from the French estate Domaine de la Romanée-Conti.
The heist reads like a metaphor for the big bank itself: much like Solomon, Goldman Sachs is old, powerful, and losing tons of money.
Goldman is now one of the worst-performing major banks
Their once wolf-like, power suit-clad trading division has fallen from grace, after a reportedly disastrous Q4 in 2017 that generated just $1B in revenue -- a number they pulled in every 10 days back in 2009.
Also, the firm endured a $4.4.B tax charge (from the US tax cuts signed into law last year), putting a $1.93B quarterly loss on the books -- their largest in 6 years.
But, like David Solomon, they’ll be juuust fine
Many experts believe these hard times for Goldman and other poor big banks are likely to be a “one-off.”
Thanks to the new corporate tax boost signed into law in December, firms like Goldman should up their earnings by “billions” next year and in the years to come.
So, save your crocodile tears for the poor wine collector… much like GS, his cellar of rares should be back up in no time.
You’ve probably seen the headlines about influential teens making thousands of dollars a day reselling their tweets to companies (if not, boy do we have some news for you).
But it’s not just corporations leaning on “influencer” marketing to boost their numbers, it’s entire governments.
And, as people and tech platforms alike rebel against branded content, the reach and influence of social media celebrities only continues to grow.
First it was “tweetdecking”...
AKA, secret groups of invite-only Tweetdecks (a twitter dashboard software) that allow users to coordinate mass retweets of their own content -- or for companies and social climbers who pay them to do it.
Brands pay $5-10 per retweet, meaning these ringleaders can make up to $5k a month T-deckin’. All with one click of the mouse.
Then it was Singapore’s financial policy
Concerned with citizens’ lack of engagement with their 2018 budget plan, Singapore’s ministry of finance reportedly recruited 50 Instagram influencers to post beautifully curated selfies with captions about “inflationary pressure” to encourage people to give them feedback.
Kinda makes you miss the days when latte pictures didn’t have a political agenda…
The trend is only projected to grow
Changes to Facebook’s newsfeed will cut brands’ reach at the knees, while promoting content from individuals and public figures.
Charlie Munger, Warren Buffett’s #2, credits his success to knowing a little about a lot
Behind every lauded genius, there tends to be a No. 2: A Pippen to Michael, a Woz to Jobs, and, dare we say, a Munger to Buffett.
For 40 years, Charlie Munger has served behind the scenes as Warren Buffett’s most trusted business partner.
He’s played a pivotal role in managing Berkshire Hathaway’s $178B stock market portfolio (Q3 of last year), advising him to invest in electric vehicle powerhouse BYD back in 2008, and many others.
While Munger has worked tirelessly over his 70-year career, there is one thing (or, technically many things) he contributes to his success.
Knowing a little about everything
According to Munger, his theory on work ethic, AKA ‘expert-generalism’ goes somewhat against the ever-popular 10,000 hour rule.
According to Quartz, rather than “lasering” in only on investment theory, his strategy is to study “widely and deeply” in many fields that he could one day apply as an investor.
Bill Gates once said, “[Munger] is truly the broadest thinker I’ve ever encountered… Our longest correspondence was a detailed discussion on the mating habits of naked mole rats and what humans might learn from them.”
You can be an expert-generalist too
Orit Gadiesh, the Bain & Co. chairman who coined the term, describes expert-generalism as “the ability and curiosity to master and collect expertise in many different disciplines.”