Finding untapped value in multicultural consumers

Note: Transcripts are automatically generated from episode audio, and are not fully corrected for spelling, grammar, and formatting.

MORGAN DEBAUN: I started my business at 24, by every single statistic in America, I should not exist, right? I’m 4’11, I’m a woman, I’m Black, I’m not technical. I ignored all the data. I just focused on progress every single day. 

In Silicon Valley, no one is making Black consumers their target audience despite the fact that we are super users of the internet, we drive all of pop culture, whether it’s through athletes, or music. So how is it that the most innovative place on Earth is ignoring this audience? 

It’s important that corporations who have Black customers make a dedicated investment in Black-owned media. The stories that we cover on our platforms oftentimes can’t be found anywhere else.

BOB SAFIAN: That’s Morgan DeBaun, CEO of Blavity, a media platform for Black millennials with over 100 million users. Blavity operates brands from Travel Noire to Afrotech. 

I’m Bob Safian, former editor of Fast Company, founder of the Flux group and host of Masters of Scale: Rapid Response. 

I wanted to talk to Morgan because while media competitors like Vice and Buzzfeed have faced layoffs recently, Blavity is thriving.

By closely targeting a community that others often undervalue, Morgan is unlocking value. 

Building trust among multicultural audiences can take years, Morgan explains, but she says the investment pays off in high loyalty and engagement. 

Morgan also serves as an adviser to businesses like American Airlines on their diversity practices. 

Her personal experience working in Silicon Valley prompted her to launch Afrotech, a now booming community of Black tech talent, which recently attracted 25000 people to gather in Austin.

Morgan provides valuable lessons on building a resilient, adaptable company, and on the still-untapped opportunity investing in Black talent and Black customers.

[THEME MUSIC]

SAFIAN: I’m Bob Safian. I’m here with Morgan DeBaun, the CEO of digital media company Blavity, which reaches over 100 million readers a month through brands like Afrotech. Morgan, thanks for joining us.

DEBAUN: Thanks for having me.

Copy LinkBlavity’s Morgan DeBaun: Never underestimate your audience

SAFIAN: So, 2023 is dawning as a challenging moment for a lot of businesses, for most media businesses, some of which are facing layoffs, for many startup businesses with their plans and their prospects under pressure. But contrary to those trends, you at Blavity seem to be doing just fine. And I’m curious, what’s enabling that difference?

DEBAUN: We have a diversified business. That’s one of the things that’s been really helpful for us. Our company is set up with a DE&I recruiting business through Afrotech. And then we have our media side of the business, which is a portfolio of brands, and an ad network that powers that behind the scenes. Why I think we’ve defied the odds. I didn’t raise that much money in comparison to some of these other companies like Vice, or Vox, or BuzzFeed. 

And that discipline allowed us to scale in a way that was profitable. Versus a huge vision that you’re taking big leaps, and then if you mess up, you have to lay off 20% of your employee base and then the fact that we serve an audience that many people overlook, and we super serve them, allows us to really be the domain expert. I don’t have many competitors in the Black media space that target the young generation of Black consumers in this country.

Copy LinkWhy Morgan DeBaun started Blavity

SAFIAN: Yeah. So, you grew up in St. Louis, you went to work in Silicon Valley at Intuit. And on the side, you started this newsletter, Blavity. What made you create it?

DEBAUN: I graduated from Washington University in 2012, and moved out to the Bay Area to work at Intuit. And I loved working in Silicon Valley. I was completely enamored with this idea of building products at scale for millions of people. 

And so I learned the idea of designing for a specific customer, and then designing for delight. And as a product manager I said, “Okay, I get the framework of Silicon Valley. But no one is making Black consumers their target audience. No one is designing for delight for Black consumers despite the fact that we are super users of the Internet, we’re driving the culture of social platforms like Vine or Periscope at the time. And we drive all of pop culture, whether it’s through athletes, or music or whatever it may be. So how is it possible that the most innovative place on Earth is ignoring this audience? 

Actually, I’m glad that they underestimated this audience. Because that leaves a blue ocean opportunity for someone like me at a very young age to say, “Great. This is going to be my mission and my purpose in life.” 

SAFIAN: And so, when you started it, did you know that like, “I’m doing this to create my own business,” at some point? Or was it a side hustle, just a fun project? 

DEBAUN: I didn’t necessarily want to make a media company. Media was not a fantastic industry, and yet, I did know that content, and narratives, and storytelling was a fast way to grow a brand.

Copy LinkWhy Blavity created Afrotech

SAFIAN: The first Blavity brand that I encountered was Afrotech, which is a sort of conference, and community and website. And it was a resource for me, a way to better understand the state of Black tech and entrepreneurs. You launched it in 2016, but I doubt I was really your target audience. What was the goal for it, and how and why did you attack that opportunity at that time?

DEBAUN: When I first started the business, I bootstrapped the company. The first time I went out to raise money, I got rejected by everyone. I made the assumption that I should raise from Black VCs. I also had a very purist perspective on wanting all Black cap table, all Black company, a Black audience. And that of course has evolved since eight years ago. But that was my original intention. 

And they all said, “This is great. but call us in six months.” I just kept getting the, “Call us later, but we’ll give you advice.” And I’m like, “I don’t need advice. I need a check.” At the point, I had already had 1 million monthly unique visitors, so, I had to lick my wounds for a couple of months and cry under the bed. And then I went back out. And this time I went after social impact investors, investors who I felt like were going to care about this business existing, because of the impact we could make. 

And that experience showed me that there was still a disconnect within the Black tech community, because we should all be helping each other. And so, Afrotech was created to create at least one moment of time in which all of us can be in one place, and use our collective power to advance more quickly. We started off in the Westfield Mall in Downtown San Francisco with 300 people. And now we are in Austin this last Fall with over 25,000 people. The city didn’t know what to do with us. They’ve never seen that many Black people in one place. So Afrotech was designed, and is designed to be a community where you don’t need permission from anyone else. Do whatever the heck you want to do. Whether it’s build a company, or go work for a big tech company, that’s fine.

SAFIAN: You’ve also talked about how, as much as you liked certain things about Intuit, that sometimes you didn’t always feel as comfortable as a Black woman there, because there weren’t that many people who looked like you who were in those hallways.

DEBAUN: When I was working there, again, this was 10 years ago, and I was a product manager and was on the more technical side. And there was maybe one or two other Black women on the entire headquartered campus that weren’t EAs or assistants. And I think that, as someone who was super ambitious and wanted to climb the career ladder, and work at these big tech companies, I also had a vision of myself where I’m like, “Do I want my biggest accomplishment to be that I’m a group director, and I’m the only Black woman that’s at the group director level? That can’t be it. That’s not my future, that’s not my legacy.” 

And I think that since then, a lot of companies have made big strides. Intuit is one of our biggest clients for Afrotech, and there’s tons of Black women running around at Intuit now, which I love, and hope that I’m a part of inspiring that. But at the time, it was not pleasant. And I felt like I had to think extra hard every day about, what am I wearing? What does my hair look like? What is Joe going to say when I walk in and my hair is curly all of a sudden? I had to spend 10 to 15% of my brain power thinking about all this other stuff instead of just doing my work.

Copy LinkThe benefits of making multicultural audiences your core demographic

SAFIAN: As you’ve scaled, you’ve added new businesses, new brands, sometimes through launching, sometimes through acquisitions. You bought Travel Noire, and Shadow and Act, which covers the entertainment industry. Now as I understand it, you’re in the process of launching a new home and lifestyle brand for multicultural millennial audiences. How do you decide what to buy versus what to build?

DEBAUN: So Travel Noire was a opportunity. I said, “Look travel is a huge part of aspirational life for all millennials, And yet, there was no travel brand at scale for our demo, despite Travel + Leisure and Conde Nast, and others. So that was a no-brainer. I would prefer to buy, hands down, every single time.

SAFIAN: Because it’s faster, because it’s easier?

DEBAUN: Because it’s faster. Because the Black consumer in our community values trust, and trust over time. So, if I have to build something new, I know it’s going to take me three to five years to build trust with our demographic. If I can buy a company or a brand that’s been around for five to seven years, and has a great brand, and a trusted, loyal audience, then that’s much easier for us. 

We have built brands like 21Ninety, our women’s brand, where it does fine. It’s not the best in the marketplace and it will take us another three to four years to get it there. So I would definitely prefer as a CEO to buy if possible. The home decor brand that’s launching when I looked at the market and how are we spending our money, home decor, hospitality, hosting friends and family. That’s actually some of the interests that are increasing dramatically within the Black community. And there was no brand that was saying multicultural audiences are a core demographic. 

Our demographic, one, is multicultural audiences versus an add-on. And I say multiethnic as well because Black people aren’t even monolithic. So you’ve got people who are first generation American because they’re Nigerian American, so they don’t view themselves as African American. Or you’ve got people who are Jamaican but married to somebody who’s from Canada. 

SAFIAN: Your core demographic sometimes you describe them as Black and sometimes you describe them as multicultural. And I’m wondering whether even that definition is something that you have adjusted over time.

DEBAUN: Our core demographic is and will always be Black. I use multicultural interchangeably because the Black doesn’t always include people who view themselves as multicultural. It’s a weird balance. It’s the same thing with Meghan Markle saying she’s not necessarily Black. I’m like, you’re definitely Black. But it’s like, if I said multicultural, she might say, oh yeah, I’m multicultural.

SAFIAN: So it sort of opens the aperture to more people.

DEBAUN: That’s right.

SAFIAN: Yeah. In your experience, what do people who are not part of the community misunderstand about the community you serve, about Black millennials, multicultural audiences? A lot of the listeners to this show are people running their own businesses who may not necessarily be engaging with that community the way they might. What are they missing?

DEBAUN: Yeah. I think that there’s a lot of fear of not wanting to mess up. I think that if you’re intentional and you’re honest, then it usually is going to work out fine. But Black folks can smell someone doing something for tokenism a mile away, and we will call you out on social media. We’ve tried to say, look, partner with us so you can do it the right way. 

But what people get wrong is just not investing enough. And my response to folks who are like, is it even worth the effort because it does require effort and intentionality. The answer is absolutely. Black consumers are also highly loyal. And so yes, high investment, but also high upside.

Copy LinkWhat happens when Black news is not financed?

SAFIAN: Some marketers designate a portion of their budget to Black or multicultural audiences. You’re shaking your head because I know plenty of Black media owners complain that it becomes a fight for these limited dollars. A couple of years ago, there was this public scrap between some Black media companies and GM, claiming the automaker wasn’t sending enough money to their properties. And we’ve had on this show, Aurora James, of the Fifteen Percent Pledge who works to get retailers to devote 15% of their shelf space to Black owned businesses. Do you feel like these sort of thresholds should be applied to media and other areas? Or do you feel like, if you have an audience of scale, the dollars will come because the return on investment is going to be there for marketers? 

DEBAUN: I go back and forth on it. Do I think that there should be dedicated dollars to Black owned media? Yes, because I don’t think that left to their own devices, media agencies will then invest in Black owned media because they haven’t. In my ideal world, people would just do what makes sense, that gets the best return on investment for the dollars. And it’s on me as an executive, as a business owner and entrepreneur to make sure that our audience delivers to our clients. I agree with my peers, Byron Allen and Diddy, that it’s important that corporations who have Black customers make a dedicated investment to investing in Black-owned media. And here’s why. The stories and the information that we cover on our platforms oftentimes can’t be found anywhere else. 

And the only way for us to be able to continue to report out on the people who are making progress within our community, is by financing the media companies that actually write these stories. But what happens when Black news is not financed? Then we’re allowing white publications to have a white lens on Black issues. And that perpetuates a narrative that oftentimes is harmful to Black folks. 

We see spend go to companies that actually aren’t Black owned, but have a Black brand. And that is in my opinion, worse.

SAFIAN: What does the flow of media dollars really look like? I mentioned Aurora James and the Fifteen Percent. Is Black media getting its share?

DEBAUN: Oh, it’s definitely not getting its share. Blavity, as big as we are in our space, is nowhere near the size of Vice or Vox. And when you’re a media agency, what is your job? Your job from the corporation that’s hiring you, is to maximize the return on every single dollar and every single impression. So the media agency, their only job when they are working with a brand or media brand like ours is to say, how can we get more for less? Can you give us this discount? Can you give us this free added value brand study? So it’s the constant arbitrage and race to the bottom in the advertising industry. 

So is it the fault of the random media planner? Of course not. They didn’t set up the media industry. Is it the fault of the CMO of a big CPG company that’s trying to win against other CPG companies? Also probably not. But this is the challenge. And for me, I’ve never wanted to be dependent on anyone to make our company successful, which is why we’re not just a media brand. That’s why Afrotech, as its own division, drives tons of value and profit for the business. 

It’s also why we built out Blavity360, which is our ad network, so that we could help other Black and multicultural publishers collectively. We represent their ad inventory so that we can have more scale and more power with the agencies.

[AD BREAK]

Copy LinkHelping brands stay accountable on their DEI commitments

SAFIAN: So alongside the media business, you advise organizations about multicultural communities and you help brands stay accountable on their DEI commitments. I know you’re on a council for American Airlines, for instance. How in that role do you get long-standing cultures to actually operate differently? 

DEBAUN: American Airlines is one that I’m particularly proud of because every 12 weeks we all get in a room virtually or in person with their C-level executives. And we spend an entire day and a half together and we go through every single piece of data. Everything from the diversity of the pilots and the flight attendants down to the upgrade system for their luxury customers to reviewing advertising campaigns and the commercials that are about to come out. What I’ve seen be most successful is when the executives at the top, the very top, make a commitment of time. Because when you’re a CEO of a company like that, all you have is how much time you’re able to spend on different issues and different groups of people. 

And I’m probably the most chill person in that room. We are pretty direct. There’s no sugarcoating things. If we see something we don’t like, we will say it in the meeting. And I respect corporations that are open to feedback that have no ego about trying to do better for Black consumers.

SAFIAN: And if you’re someone who runs or is working at an organization that aspires to be more multicultural, but right now does not have the complexion they want to have, is there advice that you would offer them about how they should think about it, what they could do?

DEBAUN: This example of forming an advisory council with folks that are part of the community that you’re trying to reach is really smart. It comes back to you taking action on the intention and then being really open and not defensive. There’s some companies, they make a mistake and they disappear. They retreat instead of trying to actually fix the problem. Because in the long run, our country is going to continue to be more and more multicultural, and it’s important for any executive leading a large company to consider the growth that you could have if you actually expand your user base or your audience base.

SAFIAN: I find that when I have private conversations with executives about this, there are a lot of excuses offered about the pipeline or whatever. But if I’m hearing you right, some of that is just an excuse. If you put the resources toward it’s just another business challenge to address.

DEBAUN: That’s right. Yeah. Is there a big pipeline in comparison to other demographics in the tech industry? No. Does it exist and there are plenty of qualified candidates? Yes. But they may not naturally apply to your company because your company may be very white and they don’t want to work for an all white, top to bottom company because then they have microaggressions and all these other things. So you have to work extra hard to say, “We know we have things that we want to fix, but we would love for you to come here and work for us. It’s not your job to fix our problems on the diversity side. We’re going to hire people whose job it is to fix those problems, but we’re acknowledging that we’re a work in progress.”

SAFIAN: I think it’s tough often for people in those situations because they carry the burden of being a role model without necessarily wanting to carry that burden, right?

DEBAUN: When I talk to Black employees who are in the 3% of the population at their company, the emotional labor and extra requests of, “Can you mentor these people?” “Can you go to this recruiting fair?” when their core job is not to be a public figure for that company. And yet I also do tend to leave those conversations by saying, “Yes, but if not us, then who? It is part of our responsibility to bring other people with us along the journey and not wait till we reach the C level to do so, or the director level to do so. We should be doing this every single day to be part of our purpose in life.” But that’s not for everybody.

SAFIAN: Yeah. Well, and I think sometimes organizations don’t always appreciate that challenge that they have those employees under. They don’t necessarily appreciate it. They don’t necessarily reward it, it just makes the burden that much harder.

DEBAUN: They should acknowledge it, they should acknowledge it and ask, “What else can I do to acknowledge it besides just saying thank you?”

Copy LinkHow being remote helps Blavity’s employees

SAFIAN: So during COVID, you moved from LA to Nashville, and you moved Blavity from office based to fully distributed. There’s no office anymore, right? That’s a route that some businesses have been pulling back on lately. Bob Iger recently requiring four days a week in the office at Disney. What’s your philosophy about why distributed? Is it a financial decision? Is it a cultural decision? What drives that?

DEBAUN: We had a beautiful office in downtown LA and the decision was twofold. One, as a workplace where more than 60% of our leadership are women, it was important to me to understand how being remote would be a value add. It increased everyone’s mental health, being able to have time away from commuting and have more time with their families, and also more generational wealth that could be accrued because we kept our salaries the same despite the fact that people move to Cincinnati, or Atlanta, or Dallas. 

The other thing was that there was a lot of data that was coming out that a hybrid workforce dramatically impacts women and people of color because of the social networking that happens in an office space that you don’t get to take part in if you are at home. And so hybrid was also something that we decided against.

It’s actually not a financial decision because we now spend a ton of money on travel. So for example, we’re doing a retreat for 35 people, everyone in a division, and everyone has a flight, everyone has a hotel room, everyone has food expenses, Uber expenses, everything. And so it’s definitely not cheaper to do it this way, but I do think that in the long run we have less churn and I’m able to recruit more senior executives who want to live in random places with their family and don’t necessarily want to move across the country for a job.

SAFIAN: And this extra travel, this is in a quest to sort of maintain and grow the culture, right? I mean, because that’s the risk when you’re distributed, that people sort of feel disconnected more than they do when they get to interact in person.

DEBAUN: Right. So we did have to make a lot of intentional investment to maintain our company culture. So we created a people engagement team. We have weekly rituals like weekly trivia in Slack. We have a really tight onboarding program. Because of all of the things in the last four years, I’d say 50 to 60% of our company never was in the office. Our culture has been able to maintain despite the fact that they didn’t have that kind of epicenter ecosystem to stem off of.

And we’re seeing great results. People are still naturally creating friendships, they’re co-working together. We have people go on vacation together and co-work from Mexico or whatever. I think over time, what we will likely do is invest in a space for people to drop in for meetings for sales executives to be able to sit with Blavity branding all around them.

Copy LinkNext challenges for Blavity’s success as a business

SAFIAN: I understand that you’re working on a book focused on how to work smarter. Is there a key principle or two that you’d point to for scaling successfully?

DEBAUN: I get the question a lot about, “Why do you think you were successful?” I started my business at 24. By all normal standards of every single statistic in America, I should not exist, right? I’m 4’11, I’m a woman, I’m Black, I’m not technical. My answer is that I ignored all the data. I didn’t even look at it. And I just focused on progress every single day. And I think that if more of us spent less time thinking about and absorbing all of the reasons why we shouldn’t do something, if we just looked in ourselves and then took a step forward, and then took another step forward and wasn’t dependent on someone else saying yes, whether that’s a VC, a professor, your parents, whoever, I think more of us would live a more purposeful life and just be happier in our existence.

SAFIAN: So when you look at Blavity’s business right now, what’s the next challenge for you?

DEBAUN: We’re very profitable and we are growing at a fast rate despite the market. I have had to personally work on as a founder who’s now a executive and CEO, is how to get out of the fight mode and more into the fast growth mode, because during COVID, you’re kind of a wartime CEO during COVID.

So we’re on a road to 100 million in revenue in the next two years. Wealth creation in the Black community and economic empowerment ultimately is the reason why we started the company. And making sure that we can get more folks re-skilled so that they can get some of these jobs that are coming out, there’s a huge opportunity. 

On the media side, man, digital media is going through a thing. So in some ways I’m kind of telling the team, “Just hold on and just coast for a second. Let’s not overinvest in video. Let’s not try to pivot to TikTok. Just stay focused on our core business.”

And then let’s see what happens in two years. There should be a Travel Noire show on National Geographic, right? There should be a Afrotech business show on CNBC. And so thinking more about how we take our brands to a wider audience is definitely somewhere in our roadmap in the next few years.

SAFIAN: Through this conversation, I keep reflecting on my own experience in the media business. I always say that the media business, it’s great fun, but it’s a terrible business.

DEBAUN: Terrible.

SAFIAN: I mean, right, it’s just so hard.

DEBAUN: It’s just terrible.

SAFIAN: You have to spend all the money ahead of time to create the content, to build the audience, to be able to attract the advertisers who pay you way down the road.

I mean, everything about it. Why do we do this?

DEBAUN: It’s so odd, right? It’s so terrible, and yet it carries so much power and influence. And so it’s a weird tension there. If we make a decision on Travel Noire to feature a city or a country for two weeks, we will drive tourism in that country. That is a lot of power.

The problem, I think, is just that media companies are the last ones to get paid in that power structure. If you go buy the flight, then you go buy the hotel and do all these things, I didn’t necessarily get paid for that. Some media companies that are doing it very well, like Red Ventures said, we’re going to be a company for commerce and we’re going to take our money first as a part of the value chain. And that is very inspiring to me and that’s something that we’ll be pivoting at least three of our brands to be commerce first. That means I’m going to leave money on the table from advertising agencies temporarily. But I think over time it’ll allow us to have a better position in the value chain.

SAFIAN: Because that is money that has better margins or that you control more?

DEBAUN: I have more proof that I’m driving the ROI. If I’m on Travel Noire and I’m inspired by an article about going to Ghana, and I then look up the flights, I as Travel Noire should get paid because someone has taken an action as a result of being on our website.

SAFIAN: You wrote recently on Travel Noire about your own trip to Ghana, to Afrochella in December. You’d been to Accra before, years before, and you reflected on all that had changed. Do you find yourself returning to any particular moments or experiences from that trip? Are there insights from that that help you as you look ahead?

DEBAUN: Absolutely. I made a last minute decision to go to Ghana in December, which is what Black folks called Dotay December, because everybody goes and they party all night. And part of that was because at Afrotech, I would say over 40% of folks at Afrotech were not African American. They were people who were Nigerian, Ghanaian, Jamaican, Haitian, et cetera. And I said to myself, “Okay, this is a shift.” And I said, “Oh, I need to pay attention to this. I’m just going to go to Africa, go see what’s going on.” And I hadn’t been in 16 years.

It was a reminder of just the scale of a company like mine. There’s no Black company that’s been able to be global, if you think about it, right? We don’t have a BBC, we don’t have a CNN. And I think Blavity Inc, over time could become a global media brand. 

SAFIAN: And it sounds a little bit like too, if 40% of your attendees at Afrotech are from the diaspora, that’s an adjusted community even for you to talk to through your US based media, right?

DEBAUN: That’s right. So for example, one of the guidance that our editors on Afrotech are doing is making sure that we are talking more about the venture funding that’s happening in Lagos in Nigeria, and venture funding that’s happening in London. Because there’s a huge connection between folks who are in America who are Nigerian, and people who still have cousins and friends and family, and go to Lagos three, four times a year. 

It’s always evolving. Blavity Inc has so many different routes, we could build a podcasting network, we could try to buy a television network and raise a ton of money from private equity. The key is just staying focused on the fundamentals of business and making sure there’s a business model to back us up along the way.

SAFIAN: Well, Morgan, this has been great. Thank you so much for doing it.

DEBAUN: So fun. Thank you for having me.