- GovExec expects to make more than $30 million in revenue this year.
- The company has a profit margin north of 20%, its chairman said.
- GovExec acquired City & State and is now looking to make more purchases.
- See more stories on Insider’s business page.
A year ago, employees at Government Executive Media Group got the kind of news that workers in the media industry have come to fear: the company was spinning off from its longtime owner Atlantic Media and would now be controlled by a little-known private equity firm.
Far from making cuts, however, the company — whose publications cover the inner workings of the federal government — has expanded, growing from 80 to 160 employees. It made about $20 million in revenue last year, with the goal of bringing in more than $30 million this year, according to CEO Tim Hartman.
Rebranding itself this month as simply GovExec, the company has a profit margin north of 20%, said Peter Goldstone, the chairman of the board who helped put together the spinoff. (Atlantic Media’s David Bradley has spent the last few years offloading his various media holdings, like the Atlantic and Quartz).
Now, GovExec is looking to make more acquisitions following its recent purchases of New York politics publication City & State and local government market intelligence service the Atlas for Cities.
“It’s a different M&A model than you see in typical media companies,” Hartman said. “We’re looking to catalyze growth and create a portfolio of growth products that are all oriented around the public sector.”
GovExec operates its namesake publication, the more than 50-year-old Government Executive, as well as Defense One (focused on the military), Nextgov (technology), and Route Fifty (state and local). Backed by private equity firm Growth Catalyst Partners, GovExec targets workers inside the federal government and says it reaches about 3 million professionals between its properties.
Hartman said the company will expand City & State to different locations, starting with resurrecting the company’s previous effort in Pennsylvania. He envisions a City & State in markets like California, Florida, and Texas in the future.
B2B media has been a bright spot in an industry that struggled during the pandemic, leading to layoffs and furloughs across the media world. Hartman said that GovExec was able to grow thanks to its stable of tech advertisers who wanted to reach government workers during the pandemic. The company’s advertisers include Cisco, AWS, and Google.
Other niche media companies like Industry Drive have also thrived recently, boosted by the soaring B2B advertising market, up 22.6% in 2020 to $8.14 billion, according to eMarketer.
“Vertical media businesses that target industries with a sizeable audience footprint have always been resilient,” said Ana Milicevic, a principal and cofounder of the strategy consultancy Sparrow Advisers.
But like all media companies, GovExec had to pause its live events business, which makes up about 30-35% of its revenue. The company put on 214 digital events last year, and intends to continue that way. “All of the indication from our audience is that they are not comfortable going back” to in-person events this year, said GovExec President Constance Sayers.