Two college grads turned a dorm-room newsletter into a $75 million exit

In October 2020, Insider Inc., the parent company of Business Insider, closed an all-cash deal to buy a majority stake in Morning Brew, a business-newsletter and podcast startup, in a deal that valued the company at around $75 million. Co-founders Alex Lieberman and Austin Rief, then 27 and 26, retained a sizable minority stake along with an earn-out clause built to keep them incentivized to stay and keep growing the business. "We are incentivized to be profitable and to grow quickly," Lieberman said at the time. Both founders joined a newly created Morning Brew board alongside Insider Inc. co-founder and CEO Henry Blodget.

The relationship dated back more than two years, starting when Lieberman and Rief approached Business Insider about a content syndication partnership. Blodget structured the deal to keep Morning Brew fully independent — same Manhattan office, same organizational structure, same five free ad-supported newsletters and podcast, and none of its roughly 60 employees laid off — a model he said mirrored how German publisher Axel Springer had kept Business Insider's own editorial focus and management intact after acquiring it in 2015.

Morning Brew had built the business from a modest $750,000 seed round raised in late 2017, shortly after Lieberman and Rief graduated from the University of Michigan, and had been profitable every year since 2018 — rare for a media startup. Going into the deal, the company expected to bring in more than $20 million in revenue and $6 million in profit for the year, generated mostly from flat-fee sponsorship packages sold around its newsletters, plus additional revenue from site sponsorships and its podcast.

Its flagship daily newsletter, also called Morning Brew, had reached 2.5 million subscribers, while three additional business-focused newsletters and a lifestyle newsletter called The Essentials brought the company's total email subscriber base to 3 million, each individually reaching subscriber counts "well into the six figures." Rief said the main newsletter maintained a consistent 40% average open rate, and that cost per acquisition per new subscriber had fallen sharply as engagement with the company's referral program increased. Blodget attributed much of the appeal to Morning Brew's hyper-loyal, business-minded millennial readership — its average subscriber was 29 years old — in a newsletter and podcast format that wasn't a core focus for Insider Inc. itself.

The deal came as many media companies were struggling through the pandemic with layoffs, furloughs, and pay cuts; Insider Inc. avoided that fate, taking only a short hit to its ad business and no layoffs, leaving it positioned to keep acquiring. "We're looking at a lot of companies and are excited to acquire more," Blodget said. Morning Brew's near-term plan centered on continued ad-supported growth and eventual revenue diversification — expanding audio through its growing Business Casual podcast, potentially opening The Essentials up to affiliate marketing, and sticking to analysis and aggregation of business news rather than original reporting in the near term.