JOE Media, the parent company of the digital publisher Joe.co.uk, found itself appointing administrators from KPMG recently after the network it's part of, the Ireland-based Maximum Media Network, faced allegations that it owes millions in outstanding loan repayments, resulting in an examiner being appointed in Ireland. 

Now with offices in London and Manchester, Joe Media entered the UK market five years ago as a subsidiary of Maximum Media Network, founded in 2010 by Niall McGarry. The best known aspect of the business is Joe.co.uk, which produces articles and social videos, and came to wider prominence last year with its entertaining political mash-up videos during the Brexit negotiations and general election campaign. It lays claim to 13 million followers across its social channels, and has worked with major brands including Amazon, Coca-Cola and adidas. 

Despite its social success, though, it’s Joe’s finances, and those of Maximum Media Network, that are behind this vexing situation. As the Irish Independent reports, the fate of Maximum Media Network hangs in the balance with its main creditor and lender, Beach Point Capital, taking a lead role in the examinership process. 

For their part, Beach Point Capital (BPC) claims it advanced more than €6 million to Maximum Media as part of a 2018 loan agreement; an agreement which included monthly repayments set at €68,000. However, BPC claims the balance due has increased to €6.1 million, and Maximum Media failed to pay interest on the loan in March and April.

This will have done little to help Joe Media’s precarious accounts closer to home. Its most recently reported figures for the year ending December 31 2018 saw Joe Media register losses of £1.7 million, with net liabilities of around £5.5 million. This was not long after it had opened an office in Manchester to house its FootballJOE brand, claiming at the time it would house 25-30 staff.

With this latest turn of events, the world of digital publishing certainly looks to be in a state of flux (has it ever not been?). While advertising revenue was initially easy to come by and investors were willing to throw money at publishers to accelerate the growth of the market, the enticing boom has turned to a whimpering bust for many.

Joe Media, of course, isn’t the only digital publisher that’s had a hard dose of reality of late.

The news around Joe reveals a worrying decline in digital media in general which has also seen several other casualties in recent years. 

In 2018, UNILAD got itself into £10 million of debt with £5 million of that owed to Alex Partridge - founder and creditor of UNILAD - and £1.5 million owed to HMRC in an unpaid tax bill. After an administrator was appointed, LADbible bought up £5 million of UNILAD’s debt, making them their rivals' largest creditor, and eventually won out over other bidders to buy the company outright. The full figure paid by LADbible for the takeover was not disclosed.

Meanwhile at The Tab, the popular student-orientated publication, the commercial team was laid off in late 2019 with the business switching instead to a programmatic advertising model which doesn’t require any commercial staff.

And more recently, The Hook - with 10 million followers and once the UK’s number one social marketing agency - quickly saw its cash-flow vanish as the Coronavirus lockdown began to bite. Upon entering administration as a result of its money woes, its core assets were sold off to rival Brave Bison with the majority of staff losing their jobs. 

Now presumably working in the hope that it will recoup as much as possible of the €6m Beach Point Capital advanced two years ago, JOE Media went into administration with the aim for it to be sold as a going concern.

Indeed, KPMG has been seeking a buyer for the company. In a statement, joint administrators Stuart Irwin and Ian Leonard said: “The administrators are continuing to trade the company and intend to undertake a marketing process with a view to selling the business as a going concern. At this time there are no plans for any redundancies. The joint administrators conducted a staff briefing outlining their plans.”

Step forward Iconic Labs. The multi-divisional new media and technology business has announced it’s supporting a bid by Greencastle Capital to acquire Maximum Media and for the assets of JOE Media. Greencastle is a new technology and media investment management business which recently invested in The London Economic, a digital newspaper supporting liberal, progressive, pro-European and pro-business viewpoints.

Intriguingly, the team behind Iconic Labs are three former UNILAD-ers. As you’ll recall, this is the business that was swallowed up by LADbible after it ended up with a £10 million debt.

On its board sits John Quinlan, Liam Harrington and Samuel Regan-Asante. Regan-Asante worked across the commercial, product and marketing divisions at UNILAD, while Quinlan ‘helped take revenues to over £10 million’ during his time there. It was Liam Harrington, though, with Sam Bentley, who acquired and rebranded UNILAD back in 2014. 

Iconic Labs have said that if their bid is successful, it and Greencastle intend to enter into a management services agreement where Iconic Labs will manage the JOE assets. Though as they have also said, there can be no assurance that either the Greencastle bid will ultimately be successful or that terms for a management services agreement will be agreed. 

If they are successful in buying out JOE Media, the ex-UNILAD Execs would be in direct competition with their former company in order to win the attention of millions of social eyeballs.

Going into administration is a miserable time for any business so let’s hope for the sake of JOE’s staff they at least get some clarity and certainty in the coming days and weeks.

(Full disclosure; the author was an employee of The Hook before it went into administration. KPMG were also the administrators overseeing The Hook’s shutdown. So you might think, ‘Well there’s job security in being an administrator, at least!’. But you might be wrong, as KPMG have also been conducting layoffs in their Australia and Canada operations.)