- Patrick McConlogue’s Borderless Services is offering $700 million to buy Forbes.
- McConlogue has a grand vision to reinvent media using crypto wallets, tokens and radio transmitters.
- But first he has to close a deal and is bidding against a SPAC for the 104-year-old property.
There are at least two competing bids to buy out storied chronicler of capitalism Forbes Media LLC.
It’s a competitive race that speaks to the disruption reshaping the current media landscape, as well as an increasingly frothy financial ecosystem where new economic models – from novel cryptocurrencies to less-traditional investment strategies – are making their presence known.
Reuters reported last week that Forbes’ owners are considering a bid from tech investor Michael Moe, who would merge the media giant with an unnamed special purpose acquisition company (SPAC). Also reported was a $700 million offer from Patrick McConlogue’s Borderless Services Inc., a crypto-focused investment vehicle.
In an interview with CoinDesk, McConlogue outlined new details of his proposal, including the cryptocurrency features he would embed in Forbes, as well as his grander ambitions for a media empire powered by blockchain technology.
“The Forbes asset is not our primary target. It's the first stop on our acquisition strategy,” McConlogue said in an interview. “Media is ripe for change, just like banking is ripe for change.”
Cryptocurrencies are the way to reshape both, he said.
McConlogue’s bid comes as crypto explodes into global prominence. Distributed technologies offer new ways to model trust, build economic units and finance deals; it’s possible cryptocurrencies could follow everywhere money flows. Though the sector promises much, it often underdelivers in practice.
McConlogue said his offer is “fully capitalized,” meaning Borderless is in the position to immediately buy out Forbes’ owners, Integrated Whale Media Investments (which purchased 95% of the company in 2014) and the Forbes family (which owns the remaining 5%).
The deal would be financed with debt and equity arranged by private equity firm Ares Management Corp. McConlogue has a background in traditional finance, including a stint as an engineer at storied hedge fund Citadel, experience he leveraged to gain access to a “deep equity table of long‑term, legacy members of Wall Street.”
Neither Forbes nor Ares responded to CoinDesk’s requests for comment by press time. Integrated Whale could not be reached for comment. It is unclear how far along discussions are – there is no guarantee Forbes would accept any offer.
McConlogue said the $700 million valuation is fair for a magazine that claims 6 million readers and reached 140 million people on the web. It was valued last at $475 million in 2014.
Crypto media empire
In addition to making a bid for Forbes, McConlogue said he plans to acquire a number of “cable networks and print media.” These deals would also be financed through Ares, McConlogue said. The endgame is to bring awareness of cryptocurrencies to readers and viewers interested in traditional finance.
“That is because the demographic that's untouched here is still, you know, the people who are opening up a magazine,” he said. McConlogue said he would change the scope of Forbes’ coverage to focus on “news of the future of finance.” (Forbes, it should be noted, already has a crypto and blockchain news wing, with CoinDesk alum Michael del Castillo among its writers.)
This widened scope would include more dedicated reporting on crypto, robo-trading and quantitative trading: “Things like that, where the world is changing quickly and markets are changing without news,” McConlogue said. He would keep Forbes' popular list products, such as 30 Under 30.
Further, a Borderless-owned Forbes would boast a one-click crypto wallet integration, such as with MetaMask, that would feature prominently in a reader’s browsing experience. Readers might receive token disbursements for finishing articles, commenting or sharing over social media channels, similar to media site Decrypt’s experimental app. Each publication under Borderless’ remit would issue its own token, McConlogue said. (Token-supported journalism has been tried before, by the defunct ConsenSys-backed startup Civil and more recently the Brick House collective.)
Borderless Services is “a skunkworks project” that has developed a “technology that changes the way that people consume information,” McConlogue said.
Details were scant and McConlogue asked to go off the record at times, but he said he’s building a “wireless protocol” called Overline that can operate offline across blockchains. It sounded like Polkadot meets mesh networks.
McConlogue has a background in computer science. While in his early 20s he made headlines for teaching a homeless man how to code. Crunchbase cites him as a core developer at Block Collider, an interoperable blockchain project funded through a 2017 initial coin offering.
It’s unclear if Block Collider and Borderless are related, though McConlogue said he has hired an in-house team of 17 developers, plus several contractors, to work on technological breakthroughs, including what he calls “attention mining.”
In all, the Borderless media empire would eventually involve a host of radio transmitters, and an antenna atop a New York skyscraper, to allow global crypto transactions “without ever touching the internet,” McConlogue said.
If all this sounds ambitious if not fanciful, McConlogue said it begins with baby steps. His first tenth of a BTC was mined with a Raspberry Pi, he said. The plan now is to make just one acquisition, then many. One node, then many.
That is, if Forbes’ owners buy his story.