Molding's criticism of the media in the past has led many to wonder why he would want to buy a free sheet. Photo: John Houlihan
For many journalists at City AM, the survival of London's free newspaper has been nothing short of a miracle.
After the pandemic crippled its core readership, the business-focused newspaper found itself on the brink collapse.
< p>The company's finances were so limited that it could not pay staff and suppliers for the summer. In a desperate attempt to save money, bosses have even removed water coolers from offices.
“We've had several different near-death experiences over the past three years,” admits one senior source.
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However, in a surprise raid in July, City AM was rescued from administration by Matt Molding, the protein shake magnate behind e-commerce firm THG.
Molding paid £1.5 million for City AM, saying it was important that the paper remained in British hands. Photo: Chris Batson/Alamy
The move raised eyebrows given Molding had been critical of the British media and the City of London. However, five months after he took over the company, the entrepreneur has put the fight against freesheet back on track.
Moulding, THG's 51-year-old founder, is not afraid to speak his mind. In a series of caustic LinkedIn posts over the past 18 months, the tycoon blamed London investors, analysts and the media for his company's poor stock market performance.
The Manchester boss even criticized individuals. journalists by name and the hashtag “#londonmafia” is used.
Unsurprisingly, this hostility has raised questions about Moulding's motives for buying up City AM, a traditional newspaper clearly aimed at promoting the city.
The entrepreneur called the £1.5 million takeover “ridiculously cheap”. adding that it was important that the newspaper remained British owned.
He also highlighted the commercial opportunities of his online retail business, which owns many beauty and nutrition brands, to reach the newspaper's affluent audience. Myprotein, one of THG's biggest brands, is now sponsoring the City AM newsletter.
“I think essentially he sees an opportunity to take what has been an underdog for 18 years into a media brand and punch above its weight.” “says the source.
“I think the working theory is that if you put money into it and give it a little more weight, the results will be quite impressive.”
p>But others are more skeptical of Molding's approach. As one staffer put it: “I see this as Matt Moulding's little vanity project that THG is trying to justify.”
Some the newspaper venture is said to be nothing more than a vanity project for THG. Photo: Ryan Eady
More importantly, there are concerns that THG's commercial interests could interfere with the newspaper's production.
This became evident in September when City AM breathlessly reported improving cash flow in THG's half-year results but made no mention of the widening losses and 20% drop in share prices that topped most other reviews.
Lawson Muncaster, who co-founded the paper in 2005, dismisses any concerns.
“I've been in this business for 18 years and City AM's editorial integrity is probably less affected now than it was under my tenure,” says he.
“I have not had any editorial conversations with Matt Moulding other than that we both believe this business is pro-British.”
A THG spokesman said: “THG is committed to editorial independence and only wants ensure stable and profitable growth of City AM. We support the brand and its journalism.”
Regardless of Molding's motives, there is no doubt that the Instagram-loving tycoon has brought about change at the newspaper.
THG hired 10 editorial staff in its first months, including two news editors. The company's aging IT systems were also upgraded.
However, the sudden influx of money and new staff was not without its challenges, as traffic is believed to have fallen sharply in the first months after the takeover.
Bosses attribute this to changes at Google and Facebook. algorithms that have also hit other publishers, including Reach and Future.
Insiders also describe chaotic scenes as the paper adjusted to new resources and an editorial hierarchy. Subsequently, charts were circulated outlining the exact hierarchy to resolve confusion.
More broadly, employees report a more corporate atmosphere in the newspaper's offices, where senior THG executives are often present.
Reporters were also horrified to discover that THG's spending policy did not cover alcohol – and it has since been amended.
The newspaper's co-founder Lawson Muncaster dismissed concerns that THG's commercial interests could impact City AM's performance. Photo: CHRIS BATSON/ALAMY
Still, City AM staff may have to rein in their excesses after years of extravagant spending during the newspaper's heyday.
Administration documents revealed the business went into administration earlier this year with debts of £2.4 million, including more than £200,000 owed to high-end hotels and restaurants.
Among the largest creditors was Boisdale, a Scottish-style fine dining restaurant near Victoria Station popular with the company's senior management. Such spending is likely to cease under Molding's watch, and that newfound discipline has begun to bear fruit in recent weeks.
The company says it ended the year with double-digit traffic growth, with 1.9 million unique visitors in November.
THG's digital intelligence also enabled it to launch the app within six weeks, accelerating its long-overdue digital overhaul. The app has been downloaded around 8,000 times to date.
“We share [City AM’s] belief in British business and are delighted to fuel its digital engine with investment and technical expertise,” the company said.
Most recently, THG expanded City AM's video output as the agency looks to reach audiences on Instagram, YouTube and LinkedIn. TikTok will no doubt follow suit in due course.
The newspaper also recently hired its first reporter from Manchester, suggesting it could shift its focus from the Square Mile to the wider UK business.
These expansion plans mean changes are on the horizon. City AM is likely to move into larger offices soon, possibly along with THG. He could also create regional centres, although insiders stressed the newspaper would remain in London.
Executives are also considering a freemium model, which would put a small amount of premium content or specialized areas such as cryptocurrency behind a paywall.
The reform, which follows similar moves by GB News and MailOnline, reflects the need to reduce reliance on declining advertising revenue and instead increase subscriptions.
Chiefs are said to be taking inspiration from partial paywall structure adopted by The Independent, with whom THG already has a commercial partnership. The company is also looking to expand its events business.
So after a close brush with setbacks, the 18-year-old newspaper is entering a new era.
Reporters previously spoke with staffers next month THG at a gold and glitter Christmas party in Shoreditch.
It was a far cry from the old Boisdale pogroms and for many journalists it became a symbol of a new era. “Probably for the better,” says one.
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