Sexy Nerve.Com Kicks Parenting Site Out of the Nest
By Jenna Wortham
January 30, 2009
Rufus Griscom, founder of the racy Web publication Nerve.com, is the first to admit it may defy logic that a Web site containing detailed essays about bondage and the effects of the recession on the sex industry spawned Babble, a parenting Web site aimed at urban hipsters.
Regardless of its conception, two years after starting Babble under his umbrella company Nerve Media, Mr. Griscom is pleased enough with its success that he’s decided to split off Babble into an independent company. Mr. Griscom said that Babble tripled its traffic over the course of 2008, ballooning from 400,000 unique monthly visitors to 1.3 million. The growth, along with interest from investors, propelled the decision to separate the two Web publications.
The “venture capitalists and media companies most interested in investing in and eventually acquiring Babble are for the most part different from those interested in Nerve,” Mr. Griscom said. “Also, we think the Babble opportunity is large enough to justify a cash infusion right now. Nerve is cash-flow positive and can grow without investment.”
Mr. Griscom is also stepping down as chief executive of Nerve.com to become the C.E.O. of Babble Media. Mr. Griscom will serve as nonexecutive chairman on the board at Nerve Media, but focus his full attention on Babble.
To facilitate the transition, he has raised $2 million from Village Ventures, a New York venture capital firm. Village Ventures has also backed hyper-local news site Outside.in and several lifestyle Web publications, including Eating Well and Makeover Solutions.
Previously, Babble was financed exclusively by the profits of Nerve.com, which began publishing online in 1997. Mr. Griscom estimated that Nerve.com, which garners 1.2 million unique visitors worldwide monthly, rakes in roughly $3 million per year in revenue from advertisements, premium content subscriptions ($35/year), online personals and royalties from a dozen Nerve-branded books that have sold 1.5 million copies worldwide.
Mr. Griscom estimates that “a few million dollars” went into Babble since it was founded in December 2006. “Now that the two companies will be separate, Nerve can invest that extra revenue into its own growth,” he said.
For Mr. Griscom, the ultimate goal is to surpass Babble’s online competition, which includes BabyCenter, iVillage and Parents.com. “We raised this money because we’re gunning for the number-one spot,” Mr. Griscom said.
Part of Mr. Griscom’s strategy is to continue distinguishing Babble from the pack of parenting Web sites. “Babble has succeeded in being a fresh voice in the parenting Web category,” Mr. Griscom said. “Now, we want to make it the most useful site for parents looking for information. We’re going to be very focused on service pieces that are useful for parents.”
Plans for Babble include adding development trackers that will send timely updates to new and expectant parents and three baby books drawn from Babble writing. Mr. Griscom said the company is also considering a subscription-based model for Babble.
In the first quarter of 2009, Mr. Griscom aims to raise another $500,000 in venture capital funding for Babble.
Mr. Griscom is currently in the process of interviewing candidates to succeed him as C.E.O. of Nerve.com and plans to expand his sales team to serve the audiences of both Web sites.
He’s confident that the parenting advertising category is more resilient than most. “If we were in the electronics advertising category, we’d be cutting our budget in half,” he said. “We’re certainly proceeding more cautiously with budget allocations than we were three or four months ago, but our advertising pipeline is still strong. We’re happy with what we’re seeing.”