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Startup Lessons From Gawker

This month, Univision, an American Spanish-language broadcast television network, bought all seven of Gawker Media’s sites for approximately $135 million. After the deal had been finalized, Univision took the decision to shut down, an entertainment and gossip blog under Gawker Media.

One of the major reasons behind this decision was the $140 million invasion-of-privacy lawsuit against filed earlier this year by Hulk Hogan, the legendary wrestling icon., which had published a sex tape of Hulk Hogan with his lady friend, lost the lawsuit to the wrestler. If the rumors are to be believed, billionaire PayPal founder, prominent Donald Trump supporter and Gawker-Hulk Hogan lawsuit funder, Peter Thiel also played a major role in this shutdown. Apparently, it was Thiel’s way to seek personal revenge from Gawker Media founder Nick Denton, who had made the former’s ‘gay’ sexual orientation public a few years ago.

Peter Thiel
Peter Thiel

While the fans mourn the closure of this mean, gossipy celebrity news site, the startup world can take a business few lessons from Gawker.

Position your verticals strategically

When Denton launched Gawker, he was very sure that he wanted to create sensational news on everything people love to read about – celebrities, technology, business or life hacks. But instead of creating one umbrella website to feature all kinds of news, he adopted a portfolio strategy. Each site focused on only one aspect and one audience. For example, for celebrity news, Valleywag for Silicon Valley news, Jalopnik for automobile news, and so on. Today, has shut down, but others sites continue to live on.Gawker

Takeaway: First, avoid adopting ‘one size fits all’ strategy for your product. Define your target audience well before positioning your product(s) in the market. Secondly, diversify your risks, you will not be disappointed if one of your risks fails.

Manage your money wisely

Gawker’s profits were invested wisely in offshore holding companies. Even today, when the company has taken a financial hit, the stakeholders can expect a return on their pie of investment. 

Takeaway: Most startups face a financial crunch, at least in the initial years or till they have raised funds from investors. Either way, it is important to manage these funds stringently and judiciously – know how much you have, allocate a budget for everything and track regularly where it is going.

Balance your leadership and management

Denton was known for sucking his staffers dry. He fired them left and right. Also, his choice of stories was often questioned, driving away the advertisers. Denton’s sole agenda was to oust celebrities and public figures, which often earned him their wrath. It comes as no surprise that both his leadership and management style were often questioned.

Nick Denton, founder and Managing Editor at Gawker Media.

Takeaway: There is a fine line of distinction between leadership and management. Management is about creating order in your workplace, while leadership is about motivating and influencing people in your circle – employees, partners, and customers. While as an entrepreneur, you should stay focused on vision, it is equally important to build and foster relationships inside and outside your startup.

Don’t let pride blind your decision

Denton published scandalous stories without any fear and regrets or how it will impact him personally and his company. But, his ego and over-confidence spelled the doom for Gawker. In Hogan lawsuit, he assumed that he could pull it off. He didn’t think of the other side of the coin – what if he lost? And, he did. Tough lesson, but hopefully one he won’t forget soon.Hulk Hogan Vs Gawker

Takeaway: A startup entrepreneur should be a risk-taker. But, these risks should be taken after weighing all pros and cons. Poor decisions lead to poor results. Always keep your Plan B ready for any decision you take.

Don’t take your rivals for granted exploited the freedom shamelessly in the name of journalism. Apart from Hulk Hogan and Peter Theil, the site has faced defamation lawsuits from celebrities from different walks of life. While political and business grudges matches are a given since the earliest days of commerce, sooner or later your business may have to pay for it.

Takeaway: It is fine to indulge in healthy competition, but unfair business policies and practices may land you in a legal soup, tarnishing your startup’s image. So look twice before stepping on any toes. Or, keep a defensive strategy ready.

Accept, learn and move on from your mistakes

In Denton’s case, he always tried to prove through his posts that he had not committed any mistakes. Perhaps, if he had acknowledged that he did cross the lines of journalism, would have been still up and running.

Takeaway: No entrepreneur is perfect. But, a wise entrepreneur is one who admits his mistakes, learns from them and moves on with his startup from a fresh perspective.

Denton has indicated that Gawker might have a second innings. But for now, he is done. Make sure you avoid this fate by focusing on the positives that just the negatives and building friendships along the way. Good partnerships, humility, and good management will help ensure your startup don’t end up like Gawker.

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The Author

Nikita Kumawat

Bussiness consultant by profession, Avid reader by soul , a friend in need and super passionate about the startup bandwagon!

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