MBA Alumni

Jim Friedlich

MBA ’85
Photos by Daniel Seung Lee
Photos by Daniel Seung Lee
I’m a kind of shapeshifter, a business executive with the heart and soul of a journalist.
September 29, 2021

Jim Friedlich could have become a journalist. While at Stanford GSB, he reported for both the San Francisco Chronicle and San Jose Mercury News. Instead, he decided to help save local journalism, which has been embattled since the late 1990s by internet competition, plummeting ad sales and print readership, and relentless cost-cutting.

As executive director of the nonprofit Lenfest Institute for Journalism, which owns The Philadelphia Inquirer, Friedlich heads America’s leading local journalism philanthropy — raising capital, fostering collaborations, and making grants to news organizations nationwide. The institute concentrates on funding high-impact reporting, new technology, and diversity initiatives in Philadelphia and around the country. The Inquirer is now the largest American newspaper under nonprofit ownership.

While working as an executive at Dow Jones & Company, Friedlich helped create The Wall Street Journal’s pioneering digital paywall. He left the company to become a founding partner of ZelnickMedia (now ZMC), a media investment firm. In 2011, he founded Empirical Media, specializing in the digital transformation of the news business.

Advising cable television entrepreneur and Inquirer owner H.F. “Gerry” Lenfest led to Friedlich’s current post. (Lenfest died in 2018.) Recently, Friedlich advised Maryland businessman Stewart Bainum Jr. as he sought to buy The Baltimore Sun from its new owner, Alden Global Capital, a hedge fund infamous for gutting local papers. If that doesn’t work out, Friedlich says, “he will likely, with our help, launch an alternative.”

Why the media business?

I thought journalism was vitally important to America — that it had broad influence in society and on government and business. At the time, I also thought it was a good business. I was quite torn about whether to be a journalist or a businessperson. My mission has become to apply new business models to save and advance great local journalism. I’m a kind of shapeshifter, a business executive with the heart and soul of a journalist.

You worked for Dow Jones after Stanford and participated in the creation of The Wall Street Journal’s paywall. How did that come about?

After a foreign assignment in Europe, I was promoted to group publisher for Europe, Asia, and, eventually, Latin America. In the late 1990s, we launched, and I was appointed head of corporate development for Dow Jones’ digital products. That was a very important strategic moment for newspapers. Some of them were prescient; some of them were, frankly, quite stupid. We believed strongly that our content had value — that we needed to charge money for it, and that it would be suicidal to give away content for free on the internet and charge handsomely for it in print.

Most other newspaper companies made a different choice.

The argument was that the internet was a free medium, and that we were all trying to build brand — that digital news was an advertising play. The belief was that newspapers would make money like broadcast TV does, by building big audiences and monetizing through advertising. It turns out digital advertising is not a good business, while digital subscriptions — getting users to value and pay for your content — can be, as the Journal has proved.

Why did you leave Dow Jones?

In 2000, like many people, I caught the dotcom fever and decided to go into media investing. Partly I wanted to make better use of my Stanford GSB training. I was for 10 years a partner in a growth equity and private equity firm. Our most successful investments were not in journalism at all — they were in entertainment. We had taken over a public company best known for a video game called Grand Theft Auto. And we were the lead investor in a TV business that produced the show Gossip Girls. When my son Max was in seventh grade, I was briefly the coolest dad in New York City. I wandered, frankly, much too far from journalism.

How did you get involved with the Lenfest Institute and The Philadelphia Inquirer?

I started my own company, Empirical Media — designed as a mini-McKinsey, focused on the digital transformation of journalism. The clients were The New York Times, The Wall Street Journal, Bloomberg, and the Tribune Company, among others.

“My mission has become to apply new business models to save and advance great local journalism.”

I found my way to the Inquirer. I had a friend and business partner, Geraldine Laybourne, who had been the CEO of Nickelodeon, and she was friends with Gerry Lenfest from their days in cable TV. She called one day, and said, “My friend just bought a newspaper. You’re in the business of saving newspapers, right?” I called Mr. Lenfest, a billionaire who answers his own phone on the first ring, and he invited me to Philadelphia. It was love at first sight. We spent about six months working with The Philadelphia Inquirer, and I was offered the job of running the Lenfest Institute for Journalism, its parent company. Gerry gifted us the Inquirer as well as an endowment to help us transform it.

The structure Lenfest created is unusual in the industry.

It is unusual. The Lenfest Institute is a 501(c)(3) nonprofit organization. One of the assets we own is The Philadelphia Inquirer, and the Inquirer is a for-profit business. Gerry, as a self-made cable mogul and entrepreneur, wanted the Inquirer team getting up in the morning eager to sell advertising and subscriptions and not feeling like they had a sugar daddy.

What are the principal challenges facing local news organizations, and how is Lenfest addressing them?

Our focus is finding and accelerating sustainable business models for important local news — not specifically saving the newspaper industry. We happen to believe that in many markets, like Philadelphia, the newspaper remains by far the most important source of investigative news and public service journalism. We remain believers in saving strong newspapers — where they exist. There are many cities that no longer have a decent newspaper or any newspaper at all.

At the Inquirer, we have made deep investments in digital transformation and digital subscription marketing — the business of the business. We’ve devoted a lot of energy and money to diversifying the newsroom, the coverage, and the voice, so that the Inquirer better reflects the highly diverse city of Philadelphia. And we’ve invested directly in high-impact investigative journalism. The Lenfest Institute also has a national mandate to help accelerate the transformation of local news and nonprofit news across the country.

How do you measure success?

The investment in investigative news is straightforward to measure. The Inquirer series “Toxic City” was on asbestos in the Philadelphia public schools. We financed the environmental testing and reporting, and that resulted in the promise of hundreds of millions of dollars of remediation by the city and state and a $100 million gift from the University of Pennsylvania for the cleanup of Philadelphia public schools. I told Gerry, “We spent $35,000, and the community responded with over $100 million.” For investments in new technology and product development, the main measures are the quality of the user experience and the revenue from digital subscribers. Our investments in diversity attract new and diverse audiences every day. We believe in our soul that diversity is essential to journalism’s business sustainability.

You’ve called Philadelphia your “test kitchen.” What have you learned that has national implications?

When I arrived, I thought philanthropy was a bridge to a different kind of sustainable future — that it would be, “Brother, can you spare a dime?” for a few years, after which we’d have a robust digital business model. I now believe that philanthropy is a critical, permanent part of local journalism. Lenfest has been a part of a national movement to build journalism as a meaningful philanthropy.

It seems that collaboration and partnership are core values for you.

That’s right. When I first got to Philadelphia, a sharp-elbowed news market, I had a meeting at a fancy restaurant with about 20 of the city’s news leaders. It was all about how we might make Philly function as a collaborative “news ecosystem.” One of the editors said to me afterward, “This was an incredible evening. Before this, half of us didn’t know each other, and the other half hated each other.”

What Stanford GSB lessons have you applied along the way?

The instinctive default to collaboration versus competition is something I associate very closely with Stanford. To me, a mission-based approach to business is synonymous with Stanford’s culture — a desire to do well and to do good.

Photos by Daniel Seung Lee

Photos by Daniel Seung Lee
Jim Friedlich
MBA ’85
Philadelphia, PA
MBA, Stanford Graduate School of Business, ’85
BA, Wesleyan University, ’79
Professional Experience
Executive Director, Lenfest Institute for Journalism
CEO, Empirical Media
Founding Partner, ZMC
Current Profile