Update 21 November 2023: Forbes is no longer being sold to US billionaire Austin Russell after he failed to close the $800m deal on time.
Forbes Media chief executive Mike Federle told staff on Tuesday that the magazine’s parent company had cancelled the transaction with an investment group led by Russell as it “couldn’t deliver the closing”.
Axios reported that Russell was “blindsided by Indian investment firm Sun Group and others who didn’t wire the money they were contractually obligated to send on the day the deal was supposed to close”.
Federle said: “The cancelation of this sale does not affect our day-to-day operations or business goals. In fact, we are well positioned to continue delivering strong results and enhance the value of our incomparable global brand.”
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A spokesperson for Russell’s family office said: “The Forbes acquisition was all about impact, and to further the philosophy of business-for-good and philanthropy with the next generation of capitalism. At this juncture, it was determined that it was in the best interest of the parties that the contract be terminated. We wish nothing but the best to the Forbes team.”
Original story, 15 May 2023: Austin Russell, once dubbed “the world’s youngest self-made billionaire“, will acquire a majority stake in Forbes.
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Russell, who was previously a Forbes cover star and a Forbes 30 Under 30 alumni, will hold an 82% interest in Forbes Global Media Holdings when the deal closes later this year.
The deal values the 106-year-old media company at almost $800m (£641m) – up from an estimated $630m (£504m) in 2021.
Russell is the 28-year-old American founder and chief executive of self-driving car technology company Luminar, which listed on Nasdaq after a merger with a special-purpose acquisition company (SPAC) in December 2020. He was recognised last year on the Philanthropy 50 list as the 36th largest charitable donor in America.
In 2021 Forbes dubbed Russell the world’s youngest self-made billionaire. The following year Forbes named AI entrepreneur Alexandr Wang, 26, as the new youngest self-made billionaire.
Forbes family out in Austin Russell acquisition
Forbes’ current owner, Hong-Kong based Integrated Whale Media Investments, has retained a minority stake in the company.
IWM purchased 95% of the company, with the remainder kept by the Forbes family, in 2014, and it will now keep one board seat. Although the remaining Forbes stake will be acquired by Russell, Forbes Media chairman and editor-in-chief Steve Forbes will remain involved in the company.
Russell said he was “honoured to be selected by the owners as the new steward” of Forbes. He will not be involved in its day-to-day operations but will “act as a visionary for the brand,” the company said in a press release.
“Today, success should no longer represent wealth accumulation at any cost, but instead be defined by how value is created and the positive ripple effects it can have,” Russell said. “My hope is that Forbes can continue to even better serve its readership by helping objectively inform, recognize, and challenge leaders to tackle society’s biggest challenges under this mission, with high quality content as well as platforms for its business-focused community.”
Steve Forbes said Russell is a “dynamic entrepreneur and thought leader who has built an industry-leading business from the ground up. His energy and vision will enable Forbes to continue and enhance the excellent work for which we are known.”
Jeffrey Yam, managing director of Integrated Capital, said: “When IWM acquired Forbes in 2014, our vision was to keep the legendary brand as a strong force in the media world, fully accelerate Forbes to digital, and leverage the strength of the brand to create new revenue streams. We were able to achieve our goals.
“Now, we are excited to pass the torch to someone who we believe can catapult Forbes’ legacy to even greater heights with his authentic vision to create a new era of capitalism, backed by one of the most recognizable business brands in the world. We believe there is significant opportunity for value growth with the new vision and, as a result, we will be retaining a minority stake. We look forward to the next chapter of the Forbes growth story.”
Forbes said it would now “empower a new board consisting of American media, tech, and AI experts at the top of their fields”.
Recent innovation at Forbes has included its experimentations in Web3 and e-commerce including the sale of its own branded merchandise. In 2022 print magazine revenues made up around 7% of its total, down from 16% in 2019 following increased diversification.
Forbes had planned to go public through a SPAC merger but ditched the idea last summer after it appeared the bad fortunes of the SPAC market would not have done due credit to its underlying value resulting from double-digit revenue and EBITDA growth over the previous year. It subsequently began looking for a private buyer.
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