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— Analysis —
This is the condensed (and sanitized) version of the birth of The Daily Deal and The Deal LLC, which as we approach our 10th birthday, now includes a magazine, The Deal, a Web-based premium service, Pipeline, and the descendant of that paper from 1999, a twice-daily PDF. We had a Web site in 1999, but it was an afterthought. Now we have a complex of sites, with blogging, video, events and significant traffic.
To mark the 10 years, we plan to examine, month by month, a "Decade of The Deal," right up to September, when we make it official, hopefully with more champagne. Although dealmaking extends into the murky mists, the notion of an organized, global enterprise that facilitates corporate change, whether through M&A or buyouts or bankruptcy, is relatively new; as a journalistic effort across a broad front, we're the pioneer. Indeed, not only has the notion of a deal economy become common parlance, but many of the themes we developed early on -- deal memos, deal media coverage, corporate dealmaking, post-merger integration, the middle market -- have been broadly adopted. Fortunately, we're better at it than we used to be. That's good, because in leafing through the first editions, one is struck by how much labor we expended on how little content. As Tony Suchon, our first copy chief, said, we were putting out a handmade paper every day. We had a scoop on day one -- wireless operator VoiceStream was closing in on an acquisition -- and a private equity story: Apollo Management LP was selling Alliance Imaging Inc. to Kohlberg Kravis Roberts & Co. And we featured David Carey's rundown of the biggest private equity earners, topped by Kirk Kerkorian, who harvested $650 million. In fact, we liked Carey's feature so much, we ran it again the following Monday, convinced no one saw it the first time. This was probably true. That week Suchon stumbled across a trash can full of Daily Deals in the subway. But back to the deal economy. The conceptual basis of The Daily Deal was that there was a growing community of professionals involved in a range of functions loosely known as "dealmaking." The original idea came from Bruce Wasserstein, then running his own firm, Wasserstein Perella, while also engaging in private equity investing through Wasserstein & Co. We began within the bosom of one of Wasserco's earliest buyouts, American Lawyer Inc. The Deal was unusual in retrospect, though less so in the startup fever of the late '90s: We were really a venture startup gestated by a buyout firm. We were also -- and this looks particularly odd today -- a newspaper in an era of dot-com startups. Friends, enemies and kibitzers of all kinds were not shy about expressing their skepticism about all this. The good news: There was plenty to cover. Deal activity had been building after the ugly end of the '80s boom, with its raiders and LBOers, both fueled by junk bonds from Drexel Burnham Lambert and its resident genius, Mike Milken. After the collapse of Drexel and Milken's jailing, many predicted the demise of (now prissily renamed) high yield and private equity. But as the '90s developed into a decade of growth, not only did junk, now spread across Wall Street, revive, but most aspects of the deal economy kicked in too, despite hiccups like the Mexican default, the Asia crisis and Long-Term Capital Management's bailout. Both ends of the spectrum saw annual volume gains -- venture capital, particularly at Internet startups, and M&A from companies concerned about competing in a globalizing, intensely technological world. By the time we launched, private equity was playing a bigger role too. This was the scene we confronted in late 1999, wielding our balky, brand-new newspaper. Little did we imagine what lay ahead. Next: 2000. Good God. Robert Teitelman is editor in chief of The Deal. Read and watch more in our
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The deal economy was almost not born on Tuesday, Sept. 14, 1999. Actually, the deal economy was booming, but we were having some difficulties getting a new national daily aimed at covering dealmaking out the door. It took two soul-destroying days of systems crashing, communications breakdowns and innovative charts that were, just slightly, off, to finally, hours late, close the first edition, take a swig of champagne and creep into the night. And then, we discovered the reality that all newspapers face: We had to do it again. The next day, with a party scheduled at the Four Seasons, a hurricane blew through. We whipped a second edition together, drank liberally and crept into the night. The next day dawned. Oh, God.
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