What Can Be Learned From the Troubles at Omidyar's First Look Media?

First Look Media lost another senior journalist last week, when Ken Silverstein left the new venture bankrolled by eBay billionaire Pierre Omidyar. On his way out, Silverstein blasted "management’s incompetence and bad faith."

And so even as First Look seems to finally be getting tractionmost recently with Peter Maas's excellent investigative piece in the Intercept on the grim fate of a State Department leakerthis fledgling news outfit continues to generate unflattering news.

In fact, while we're not keeping count, it seems like there have been more stories about First Look Media than by the many fine reporters who work there. 

I have zero interest in piling on, or sorting through the different versions of what's happened, including the latest dump of details by Silverstein. On the other hand, this does seem like a learning moment for the booming field of media philanthropy. What are the lessons here—not just for donors who might put their money behind media, but for the journalists thinking about getting in bed with them? 

Let's start on the funding side of the fence. It's tempting to say that one quick lesson is that rich guys should keep their distance from journalists, who aren't known for being the best team players in the world and can pick up a mighty big bullhorn if they decide they've been wronged. Chris Hughes and Pierre Omidyar have both learned that lesson the hard way in recent months. Forget the quote about not picking a fight with people who buy ink by the barrel; worse still is tangling with someone who has thousands of Twitter followers, and has close friends who have thousands more. 

Of course, plenty of other funders have bankrolled media projects without ending up in Gawker. And plenty of journalists have gotten along just fine with those funders. The best example is how Herb and Marion Sandler, a retired banking couple, funded the creation of ProPublica—the premier investigative reporting nonprofit, which has flourished without internal drama. 

So what did the Sandlers do right that Omidyar did wrong? 

Well, recently I spoke with Herb Sandler for a profile that dug deep into his methodology as a funder. We talked about how ProPublica came into being, along with other new ventures underwritten by the Sandlers, like the Center for American Progress and the Center for Responsible Lending. 

In each of these cases, the Sandlers did two crucial things: They invested in talented people who were also super-experienced managers and, as crucially, they let those leaders build an organization with a minimum of interference. In the case of ProPublica, the Sandlers recruited Paul Steiger, who was just winding up a 16-year stint as the managing editor of the Wall Street Journal. You can't get more experience than that. And as the editor-in-chief, CEO and president of ProPublica, Steiger had full authority to call the shots in scaling up the place. John Podesta, the leader of the Center for American Progress—whose credentials as Bill Clinton's former chief of staff were even more impressive—had the same kind of authority.

That's the way the Sandler Foundation does business. As Herb Sandler told me: “If we think that an organization is working on the right stuff and has the right leadership, we’d rather give them the money and let them decide how to use that money... It’s not us who’s doing the work, it’s the nonprofit."

As First Look was coming into existence, it seemed that Glenn Greenwald was the Paul Steiger of this story. When news first broke that Omidyar was putting $250 million into a new media venture, Greenwald's name was front and center. In fact, in some versions, it sounded like Omidyar was putting Greenwald directly in charge of that big pile of money. 

But that's not the way things turned out. Rather, Greenwald and the other top journalists pulled into the starting First Look—Jeremy Scahill and Laura Poitras—weren't given anything like the authority that Steiger had. Instead of tapping a single talented journalist who also had a strong management background, Omidyar would split up the functions in a far-flung organization, hiring executives in Silicon Valley to oversee staff in New York and, in Greenwald's case, Brazil. Bad move. The result was:

a fundamental culture clash that has plagued the project from the start: A collision between the First Look executives, who by and large come from a highly structured Silicon Valley corporate environment, and the fiercely independent journalists who view corporate cultures and management-speak with disdain. 

Or so wrote Greenwald, Scahill, Poitras, and John Cook in an article publised in The Intercept after Matt Taibbi left First Look last October, amid conflict over his role in building a publication there called The Racket

That article suggested First Look was ironing out its internal issues and maybe that's the case, Silverstein's departure aside. But some of these problems could have been avoided if Omidyar had made different choices about leadership and organization at the start.

Perhaps the root of First Look's troubles is that Omidyar has seen this as his own startup, and was hands-on from the beginning, in a way that the Sandlers never were with ProPublica. As Andrew Rice wrote in New York magazine, Omidyar "never expected to be a passive investor" in First Look and "he was deeply involved, demanding personal approval of even trivial expenses." 

Now, there's nothing wrong in theory with Pierre Omidyar deciding he wants to throw himself into a media startup and no reason to think he wouldn't succeed at such a venture if he gave it proper attention. In reality, though, Omidyar and his wife Pam have a global philanthropy empire to run, one with lots of moving parts—including five different ventures under the umbrella of the Omidyar Group. He's not in the position to be the entrepreneur that scales up First Look. Yet he's been involved enough that nobody else seems truly empowered in that role. Advice to other philanthropists with big ideas: Don't do that.

So what are the lessons for journalists thinking of working with philanthropists? Maybe the biggest lesson—and one that applies to anyone collaborating with a major donor to realize an ambitious idea—is to get maximum clarity about authority and autonomy before moving forward, and to pay keen attention to how the chain of command is likely to play out.

Some due diligence wouldn't hurt, either. It's not every philanthropist who's going to write big checks and then get out of the way. But a donor's past track record can shed light on what kind of involvement they're likely to want in a new venture. If Glenn Greenwald didn't have a chat with other Omidyar grantees before signing up for what he described as a “once-in-a-career dream journalistic opportunity,” he should have. 

Remarkably, Omidyar and Greenwald never even met before First Look was launched—a due diligence failure on both sides. A billionaire donor couldn't spring for a plane ticket? Greenwald was too busy in his jungle lair to meet a man he was hitching his career to? I don't get that. The Sandlers interviewed 30 people about John Podesta before they gave him a dime for CAP, and you can bet Podesta did his own checking around.

Of course, whatever the troubles at First Look so far, the opportunity that Greenwald initially described is still unfolding. The Intercept is now producing great investigative journalism and Pierre Omidyar's pockets are as deep as ever. Presumably, also, lessons have been learned and changes have been made, or will be. Maybe years from now, when First Look has the kind of reputation that ProPublica does, these rocky early days will be long forgotten. 

Who knows? Perhaps Ken Silverstein will even wonder why he left the place in such a huff.