I sold my website for more than $60m and now it’s being turned off
CarAdvice founder Alborz Fallah reflects on the origins, the sale, and the switching off of the website he sold to Nine, following the announcement that Nine would roll CarAdvice into its Drive motoring platform.
When I came to Australia from Iran at the age of nine, my goal in life was to escape the challenges of being financially and geopolitically disadvantaged and Australia offered enormous opportunities to do just that.
I learnt at an early age that traditional employment was not my style and as an entrepreneur at heart, it took me 17 attempts at starting a business to get one to go big, but when I started CarAdvice in 2006 I never imagined it would one day be acquired by Australia’s biggest media entity for more than $60m – one of the biggest media deals of the decade – and frankly, I never imagined that it would then be turned off less than two years later.
So, what is it like to be told something you have started and helped build into an industry-leading destination will be retired?
Don’t get me wrong, I am insanely grateful for the experience and of course, the financial reward of selling CarAdvice to Nine, but a part of me is deeply saddened by a decision that I am struggling to pragmatically or commercially understand.
When we sold the first batch of CarAdvice shares to Nine in 2016, we knew things would be different. Having heavily considered an IPO path, the sale to Nine was seen as a safer option. We were actually really excited by the opportunity to work with a huge media partner that would help us grow and dream bigger.
L-R: Paul Maric, Alborz Fallah, Anthony Crawford
To an extent, some of that became true, but for a very long time most of us at CarAdvice felt that Nine left us to our own accord and we ran the business in the same manner that our success was built on. This was working well and to this day I am grateful to the former management at Nine, such as the likes of ex-Nine CFO Greg Barnes for giving us that freedom and guiding us through the political landscape in such a huge organisation.
The final takeover of CarAdvice by Nine did not finalise until late 2018 and a management take over only happened in mid-2019.
When Nine merged with Fairfax and CarAdvice took over Drive, it was a huge business victory for us. It was obvious to the management team of CarAdvice at the time, that we would maintain CarAdvice as the primary editorial powerhouse and work out something else to do with Drive.
Before then, even any whisperings of going from CarAdvice to Drive were considered illogical by CarAdvice’s previous management team, so much so that our strategy was (deeply explored) to do the exact opposite. Keep CarAdvice, forget about Drive.
When Nine’s takeover of CarAdvice was complete in August last year, it didn’t take long before a great exodus of people began, which saw dozens and dozens of my long time CarAdvice colleagues and I depart the business to search for new opportunities or a vision we could all align with.
Even while the stack of Apple Macbooks from my former teammates grew ominously taller like tombstones on an empty desk, never once did we actually think a big media entity would spend such considerable amounts of money on such a profitable asset to only then decide to retire it.
The decision to turn off one of Australia’s best-known auto websites might make perfect sense to those that made it, but it’s important to realise that when CarAdvice started 14 years ago, Drive was the dominant editorial player in the market. We spent more than 10 years at CarAdvice working tirelessly to successfully erode its market position and installing ourselves as the go-to place for independent car advice.
From 2006 to 2016, CarAdvice outperformed Drive. Genuinely. We killed Drive for content, innovation, technology and in almost any other metrics one could imagine. We lived and breathed our goal to be the best editorial site in Australia. That goal meant going after Drive. No doubt that Fairfax’s inability to understand digital publishing helped our cause and Nine’s decision to buy CarAdvice was truly genius.
Same can be said about Nine’s decision to consolidate its auto brands into the one masthead, but what is the value of a brand and how do you measure it?
Nine’s reasoning to favour Drive because it has 25+ years of heritage and is better known by a certain audience base is technically very valid. But in 2020, one can argue that brand heritage is not the only reason consumers use an online service.
Over the first decade, we grew CarAdvice to over 700,000 fans on Facebook. At one stage, that was more than Drive, Carsales and Carsguide combined. That modern-day audience does not care about Drive’s heritage in the newspaper or that it has been a staple in Fairfax publications for years before CarAdvice.
I would also love to ask that same audience that knows and better recognises the Drive name over CarAdvice, whether they recognise MySpace over TikTok. Or perhaps Kodak over GoPro. High levels of unaided brand awareness are not a recipe to success.
That’s not to take away from the fact that CarAdvice also has 14 years of heritage and a significantly more engaged audience at this present time.
With the founders and a great deal of the very best people that once made CarAdvice great now working on CarExpert.com.au and with other CarAdvice staff now at high positions at the Bauer motoring titles and Carsguide, the best legacy that CarAdvice has to offer the Australian media landscape is the people and skill sets that it formed along the way.
CarAdvice as a brand reshaped automotive content in Australia. It built a reputation and an amazing name in the process. That might have been diluted in the years post the sale, but it takes a lot to kill years of brand building, well, unless you turn the brand off.
There is still money and profit in quality journalism and content. Our move to CarExpert has proven that. It just requires the bold approach of putting the consumer/reader first. In my opinion, the move from CarAdvice in favour of Drive is a focus on Commerce over Content to the detriment of the end-user.
Ultimately, this will be an interesting demonstration of rebranding a giant media entity and its success or failure will be used as an example for how to do or not to do something.
The current team at CarAdvice are an amazing bunch of highly talented people, so if anyone can make it a success to transition brands, it’s them. I know that they have it in them to take all the very best of what is CarAdvice and bring it to Drive, my only question is, why do they have to?
Alborz Fallah founded CarAdvice.com.au in 2006. He is the founder of CarExpert.com.au and currently an honorary adjunct professor and entrepreneur in Residence at the University of Queensland.
