Owner of Vegetarian Times wants a greener future; Paul Obis launched it, sold it and bought it back; now he's trying to grow a larger crop

Folio: The Magazine for Magazine Management, August, 1988 by Jean Marie Angelo

Owner of Vegetarian Times wants a greener future

Oak Park, Ill.--Paul Obis is a frustrated empire builder. He wants to increase the fortunes of Vegetarian Times, the magazine he launched in 1973, and take on more titles. He has considered acquiring Herb Quarterly, a magazine for those who grow and use herbs, and DuPage, a regional title for an Illinois country. He has even mused about relaunching defunct Collier's. So far, nothing has panned out.

But Obis, now 37, remains patient. He's used to patience: For much of his career, he has struggled not only to build an empire, but to hang on to the cornerstone.

Obis started his title at 22, writing it, taking it to the print shop and carrying the print run home on his bicycle. But life wasn't so simple. Obis took out a $5,000 loan to obtain capital, and was in a tight spot when the note was coming due. He began scouting for interested buyers through classified ads in the trades; Bill Schnirring at Associated Business Publications (ABP) came to the rescue.

ABP agreed to pay the $5,000 and other outstanding bills to keep the magazine alive, but for six months did not pay Obis a salary for his duties as editor. (Fortunately, Obis' other job in nursing paid the editor's personal bills.) Obis retained a minority interest, but for eight years was someone else's employee.

Resentments grew. "As a founder, I was still too tied to the magazine emotionally to accept the fact that it had a new owner," he says. "It was always a failure on my part that I had to come under someone else's ownership. It was inner personal stuff."

At the time, too, each magazine in ABP's eclectic group, ranging from NASA Tech Briefs to New Satirist, was managed out of New York City, even though Vegetarian Times was written in Oak Park. Obis was unhappy with ABP's graphic design of the magazine, and his enthusiasim for editing Vegetarian Times waned, he admits.

ABP was upset, too, knowing that Obis was not putting all his effort into the product, says Schnirring, who notes that Obis is more comfortable when he makes the decisions.

To relieve frustration, Obis purchased the subscriber list to defunct Soyfoods for $1,000, attempting to revive the magazine while continuing to edit Vegetarian Times. The plan, however, was viewed as a conflict of interest.

Then came good news. ABP told Obis it wanted to cut its losses at Vegetarian Times, which was still in the red. Schnirring gave Obis the first shot at buying it back, but was open to bids from other potential buyers.

"Feeling as I did, I wasn't about to let anyone else buy it," says Obis. The magazine, however, had a cashflow of $1 million and ABP wanted a seven-figure amount. Obis knew that was out of his range, but made a bid anyway, with financing secured through a friend.

The day before Obis and ABP were ready to sign papers, another publisher surfaced with a better deal. "Bill calls me and says, 'This guy is really sharp. How would you like to live in Cleveland, and work for him?' I thought, 'Oh, my God.'"

Obis flew to New York City that day with a $50,000 check in hand. "I told Schnirring, this guy may have a better offer, so you think. But someone else may not know the market like I do. You may get your down payment, but you may never get another dime." With that Obis cemented a leveraged buy out in early 1985 that would allow ABP to recoup is debts--about $500,000--with interest. Obis' friend became a silent partner with a 25 percent stake.

Today Vegetarian Times is healthier than ever. Circulation, at 80,000 when Obis bought back the title, is now at 150,000 and climbing, thanks to a larger editorial staff and more four-color. Gross revenues are at $1.75 million, up from $960,000 three years ago. And, the magazine is now in the black, he notes.

Obis is anxious to bring more titles into the fold, particularly those whose readers are similar to the flagship's. That would allow the company to capitalize on its subscription and advertiser lists.

More practically, the next step for Obis may be deja vu: He's searching for capital and would consider another financial partner. "We will eventually get bigger, but if someone had the money now, they could make us big real fast," he says.

In light of current consumer awareness of health and holistic care, vegetarianism, he says, may become more popular--and perhaps more advertisiers will take notice. Ocean Spray and Sunkist, he says, would be naturals for Vegetarian Times, and Obis still can't believe that Kellogg won't buy space for its Nutri Grain cereals.

After all, vegetarians, he says, are certainly "inner directed," a trait that appeals to marketers. They also travel in good company. "Gandhi was a vegetarian. So were Leo Tolstoy, Albert Schweitzer and George Bernard Shaw." And of course Paul Obis, potential magazine mogul.