Leaf Group has had an interesting journey, transforming from a content “farm” into a dominant media and e-commerce powerhouse. Originally known as Demand Media Inc., the company managed popular online brands like eHow, livestrong.com, and the marketplaces Saatchi Art and Society6. Many people, especially those in Los Angeles, are quite familiar with these names. You can learn more about Leaf Group’s history and its operations on the la-future.com site.
Founding a Content Empire
Founded in 2006 by private investor Shawn Colo and entrepreneur Richard Rosenblatt, the former chairman of MySpace, Demand Media Inc. was headquartered on 26th St in Santa Monica, California. The American content company owned and operated several well-known brands:
- eHow: An informational website offering how-to guides and advice on a wide range of topics.
- livestrong.com: A site dedicated to health, fitness, and cancer awareness.
- Saatchi Art: An online gallery for selling original works of art.
- Society6: A marketplace where artists could sell their work on various products, including apparel, home decor, and accessories.
The company became known for its business model, often labeled a “content farm.” This was due to its strategy of producing a massive volume of content based on popular search queries to attract traffic and monetize it through advertising. Demand Media Inc. also provided social media platforms for major companies and distributed content using social media tools.
Content Creation Strategy
Demand Media’s business model was unique because it not only created data-driven content but also had a monetization strategy built right in. The process was a logical sequence of steps:
- First, an algorithm analyzed search queries and advertising bids to determine which topics were the most popular and profitable. The focus was on “how-to” and instructional content, which users actively searched for.
- Once a topic was chosen, the company hired freelancers to create the content.
- The final step was publishing the material on the company’s own platforms (eHow and livestrong.com) and on third-party sites like YouTube.
Restructuring and the Final Chapter
The company went through several phases of development, restructuring, and asset sales. In June 2021, Graham Holdings acquired Leaf Group (the name the company adopted in 2016) for $323 million. This acquisition marked the company’s transformation from a SEO-focused content farm into a media company centered on e-commerce. A key driver of this shift was CEO Sean Moriarty, who aimed to create a portfolio of expert-driven content that consumers would turn to for their purchasing decisions.
Sean Moriarty joined Leaf Group after the company’s acquisition of the online art marketplace Saatchi Art in August 2014, where he had served as CEO for about a year. In 2023, the company underwent a major restructuring, forming a new entity called World of Good Brands. This reorganization separated the publishing sites (Well+Good, Livestrong, Hunker, OnlyInYourState) from the e-commerce marketplaces (Saatchi Art and Society6).
The next chapter in the company’s story was a series of asset sales in 2024 that ultimately led to its dissolution. Hunker was sold to Static Media, Well+Good and Livestrong were sold to Ziff Davis, and Launch Potato acquired Only In Your State. Following these sales, World of Good Brands ceased operations, and all its staff were laid off.
Controversy and Criticism
Demand Media, now known as Leaf Group, was often criticized for its content-mill business model and accounting practices. The company was frequently called one of the largest content farms, a label highlighting its strategy of mass-producing content. To cut costs, the company relied on a huge number of articles and videos from low-paid freelancers, which often resulted in low-quality content.
One of the most controversial aspects was the company’s practice of capitalizing content creation costs. Instead of treating these as current operating expenses, the company classified them as assets on its balance sheet, amortizing them over five years. This approach meant that Demand Media spread out the large costs of content production over a long period, which artificially inflated short-term profitability. Analysts widely criticized this method, arguing that it didn’t reflect the company’s true financial health.
E-commerce Becomes the Core Business
Leaf Group CEO Sean Moriarty explained the shift towards e-commerce, making it a central part of the brand’s philosophy. He noted the immense short-term pressures faced by small public companies. After the Graham Holdings acquisition, Moriarty explained how the company fit into their vision. Graham Holdings, which also owns Framebridge, a brand specializing in direct-to-consumer sales in the design and decor category, had a wealth of knowledge in customer acquisition and retention. This expertise became fundamental to the e-commerce side of the business.
By focusing on e-commerce, Leaf Group was able to diversify its revenue beyond advertising. The brand built a loyal and trusted following, which helped it attract high-quality authors and improve the content.
Graham Holdings and World of Good Brands
Graham Holdings is a diversified holding company that owns and operates a wide range of businesses across various sectors, including education, media, healthcare, manufacturing, automotive, and retail. This approach makes its business model flexible and resilient. Graham Holdings has a history of acquiring businesses that can thrive under its ownership and benefit from its resources. The 2021 acquisition of Leaf Group was a perfect example of this strategy. Graham Holdings consistently demonstrates stable operations across its diverse portfolio.
World of Good Brands was created as part of the restructuring of Leaf Group’s media assets following its acquisition by Graham Holdings. The company was formed to separate and focus on the niche media brands that had belonged to Leaf Group. Its key characteristics include a focus on expert media and e-commerce brands, a portfolio of well-known digital media brands, and shared ownership, with WGB being a subsidiary of Graham Holdings Company.
Although Leaf Group no longer exists as a separate entity after the acquisition, its legacy lives on in the portfolio of brands now owned by World of Good Brands and Graham Holdings.
