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25 and Counting

In 1980, San Diego was on its way to becoming a major player on the national stage, and Houston-based publisher Bob Gray wanted a front-row seat when it happened. So, he alerted his staff at the Cordovan Corp., which was publishing a fast-growing and successful group of local business newspapers.

“A decision has been made to publish San Diego Business Journal,” Gray wrote in a memo dated Feb. 26, 1980.

Its mission: “To supply the big San Diego market with the best in local business,” Gray wrote.

At the time, Cordovan, which had just been acquired by the E.W. Scripps Co., the parent firm of Scripps-Howard newspapers, had two other business journals in California , Los Angeles and San Francisco , and published business weeklies in Seattle, Dallas, Atlanta and Houston, which debuted in 1971.

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The first issue of the San Diego Business Journal , 36 pages , was published July 21, 1980. The single-copy price was 50 cents, as opposed to $2 today, and an annual subscription was $24, compared with the present rate of $99.

Today, looking back over 25 years, Gray recalls a relatively smooth ride.

“San Diego did well almost from the beginning in a financial sense,” he recalled of the new journal. “We attracted a good body of advertising. We didn’t have any real serious resistance to our entry into the market there.”

That wasn’t always the case, said Gray, 81, in a phone interview from Houston.

“In some cities, the chamber of commerce wouldn’t like us very much, because they put out a monthly magazine and viewed us as an advertising competitor.”

So, he had to finesse it.

“We weren’t a threat really,” he said. “I’d say to them, ‘Look, call the Houston Chamber of Commerce, talk to the editor of their magazine, ask him are we a competitor of his in Houston?’ I knew the answer. He’d say, ‘They gave us some of our best advertising leads.’ ”

Those leads had been un-mined gems, said Gray.

“We’d come in and companies would advertise through the journal,” he recalled. “Suddenly, they had their own medium of information. The dailies essentially are consumer newspapers. The rates are high, reaching about 100,000. Our journal reaches comparatively a small number , businesspeople; rates don’t have to be that high. We were able to price our space at a good level, less than the dailies.

“We opened up to those who didn’t advertise before , service companies that wanted the business of other businesses would use the journal. The consumer papers jumped right on that. They had ad prospects they never had before.”

Soon, every city that had a chamber magazine discovered that the journal would “stir up new advertisers they didn’t know anything about,” said Gray.

“It led to a peaceful working relationship,” he said.

But Gray said he had to blaze a lot of trails when he started publishing his business journals.

“The coverage of business was pathetic,” he said. “That changed when our business journals started appearing on the scene in ’71. Business journals helped reorient daily papers to the fact that business was just as important as sports or society or cooking.

“They saw us as competition, so they immediately restructured our product to include at least one major business page or section a week. It was healthy competition. We both stirred up interest in the business community.”

Gray did his homework on potential business journal sites.

“We zeroed in on different cities, where we had no local competition,” he said. “Before long, other business journals were competing with us. In the period from ’71 to ’82, I started 12 journals , nine startups and three acquisitions, which all had to be redone.”

San Diego was an obvious market, said Gray.

“San Diego was one of the business bright spots of the country, then as now,” he added. “We looked around the country and spotted markets that were or were going to be major markets. San Diego was on the cusp of becoming a major market. We didn’t dare not start in San Diego, because of its future potential.”

Gray recalls 1980 as “probably the busiest year in my business experience.”

“I started five journals that year , San Diego, Miami, Phoenix, Dallas and Seattle. It was a pretty frantic year. We had a new one coming on stream every 10 weeks or so,” he said.

Even though he had the nuts and bolts of the system down, starting a business journal remained an inexact science, human nature being what it is, said Gray.

“You had a different mix of people every time, and we never knew how those people were going to get along together,” he said. “We had a formula, but that didn’t mean it would work.”

Staffing the journals was a challenge, he said.

“It was hard in those days to find business journalists,” said Gray. “We had to do a lot of training. Sometimes, we’d bring them to Houston for indoctrination for about a week. It was helpful. Business journalists were a new thing in ’71. There were no real business pages in the country.

“They all had business pages, but with consumer-oriented stories, not about business for businessmen. Newspapers had yet to grasp the fact that business was a major activity that newspapers should cover.”

Yet it all worked out.

“San Diego came together very well, as I remember,” said Gray. “We had a good staff and editor, Denise Carabet.”

Her tenure got off to an unusual start when she informed Gray that she very much wanted the job, but already had made plans for a two-week vacation. Could they delay publication, she asked. Instead, Gray arranged for an editor from his Atlanta paper, Carol Carter, to pinch-hit , not only as editor, but as Carabet’s housesitter and cat feeder. Carter even drove Carabet’s car.

“She was a terrific woman,” he said of Carter. “She did a very good job for the first two weeks. Then Denise came back, and Carol went home. It was the most unusual startup situation I’ve ever seen, but it started out fine.”

Ted Owen, who came on board as publisher of the San Diego Business Journal in 1987, recalls that Carabet “was an actual good old newspaper-style editor.”

“Denise was a pretty famous person in business journalism in the region. In the early to mid-’80s, she was a very prominent woman. She brought a standard of excellence to the paper,” Owen said.

Setting A Tone

Gray said that he never tried to micromanage his editors.

“I left the editors to the coverage,” he said. “All I told them was, ‘Cover your city, the major industries and businesses, the entrepreneurs. Write stories about business successes.’ Readers want to know, ‘How can I get rich, too?’ Our papers set out with the idea of not only reporting what was happening, but who was doing well at what business. We had a series of business success stories in every journal.

“It was exciting stuff at the time, because it wasn’t being done. It’s easier said than done , finding real entrepreneurs who were making their businesses work. They keep their heads down, because they don’t want the competitors to know what they’re up to.”

Gray also encouraged his far-flung editors to tap into an information grapevine.

“I got the editors talking to each other,” he said. “Once a year, they’d come to Houston for a symposium, and I’d urge them to pick up a phone and talk to each other. A story in one paper might have an application in their own city. It was a round robin.”

While Gray was part of the shift from paste-up and flats to electronic publishing for his golf magazine in 1984, computers hadn’t arrived during his tenure with the business journals through 1982.

“We moved to high-speed typesetting with new equipment, but we weren’t into computers at that point,” he said. “While I was there, it was all standard paste-up. We worked out some simple procedures for the run-through. I’d gather most of the staff , the sharpest people , who would stand looking at the flats, while the editor ran through it. We found how easy it was to miss obvious things. No matter how eagle-eyed the editors were, something was always wrong.”

Armon Mills, who signed on as president and publisher of the San Diego Business Journal in April 2004, said he considers Gray to be “a visionary in the continental United States,” but recalled that George Mason shared a similar vision, back in 1963, when he started Pacific Business News in Honolulu.

“Mason’s first trip to Hawaii was in 1947, after the war,” Mills recalled. “He had a one-way ticket from San Francisco to Honolulu for $250. It took 13 hours , that was before jets.”

In 1984, Mason sold his operation to the then-Kansas City, Mo.-based American City Business Journals, Inc., where Mills then served as president and chief operating officer. The chain bought the San Diego and Los Angeles business journals on Dec. 31, 1986.

Owen On Board

If 1980 was a frantic year for Gray, 1987 proved to be equally challenging for Ted Owen, the former director of the north city office of the then-Greater San Diego Chamber of Commerce.

“September 18, 1987, was the big crash,” said Owen, now president and chief executive officer of the Carlsbad Chamber of Commerce. “I joined on September 1. I had a paper that had 1,200 paid subscribers, and 22 employees. The economy was sinking, the building was awful.”

How awful?

“It was down in Mission Valley, adjacent to a sewer filtering plant that was being tested,” he said. “The smell was spectacular. The air conditioning didn’t work. My office was 91 degrees, when the AC was running. I called the building manager. He said, ‘The system needs to be replaced. Your share will be $30,000.’ I said, ‘I don’t think so.’ ”

In the spring of 1988, California Business Journals bought the San Diego and Los Angeles business journals, and Owen was offered this bit of real estate advice: Self-evict yourself. If a tenant can be evicted for lease violations, so can the landlord, who was supposed to be taking care of the building at his own expense, said Owen.

“We started looking for a building, and we had two years left on the lease,” said Owen. “They didn’t like it, but the brokers dealt with it.”

In the early fall of 1988, the 40-member San Diego Business Journal staff made the move to its present location at 4909 Murphy Canyon Road, Suite 200, in Kearny Mesa.

“It was a brand-new building,” he said. “We demanded signage on the roof, and no other signs on the building, and they gave us those rights.”

Back in the early days, said Owen, there was a lot of competition from the likes of the Daily Californian and a half-dozen other papers that are no longer published.

“We didn’t have a huge track record,” said Owen. “We were almost like a newsletter. It was a matter of redesigning the paper, hiring editors and reporters.”

Among the major movers and shakers back in those days, he said, were real estate magnate Malin Burnham, Herb Klein, the editor in chief of the Copley newspapers, and Pete Wilson, then a U.S. senator, and former San Diego mayor, who would go on to become governor in 1991.

“Irwin Jacobs was just starting to get recognized,” he said of the founder of the now mighty, but then still emerging, Qualcomm Inc. “John Moores was not even here yet. General Dynamics was the primary industry in San Diego. Home Federal and Great American, the two big banks, are now gone. But the city hasn’t changed much in industry. The top four have been manufacturing, military, tourism and agriculture. We’ve always been a real estate city, driven by the economy. We have fewer ships here today, but they’re bigger ships and more expensive to run.”

As for the San Diego Business Journal, Owen said of his tenure there, “It’s the memories, all the awards, the people , seeing the people grow into better professionals than when we got them.”

In March 2004, Owen left the San Diego Business Journal to head up the Carlsbad Chamber of Commerce and was replaced by Armon Mills , the man who had hired Owen back in 1987.

Mills, certified as a public accountant in 1967, worked in public accounting at Fox & Co. for two decades before signing on as president and chief operating officer of American City Business Journals, Inc. He has served as publisher of the Business Journal in Phoenix, the San Jose Silicon Valley Business Journal and Silicon Valley Business Ink.

When he received the offer to take on the publisher’s job, Mills was more than happy to heed the call.

“My initial reaction was that San Diego was a great place to live and work,” said Mills, whose son, Darin, had graduated from the University of San Diego in 2002. “There seemed to be a myth outside San Diego that the city is mostly tourism and the military. But it is a really vibrant business community, an exciting place to live and work. It doesn’t get any better than San Diego.”

Was he daunted by all the dirt at City Hall?

“I didn’t think much about the turmoil at City Hall,” he said. “I look at the ballpark, the strong associations with the Regional Chamber of Commerce, San Diego EDC (San Diego Regional Economic Development Corp.), the Downtown Partnership, CCDC (Centre City Development Corp.), and the strong infrastructure,” he said.

“I was told before I moved here that it was a small town, and I’ve come to realize it is a very small town, with the people and relationships, and I mean that in a very positive way. The business community is evolving. It’s a vibrant business community, and we have so many things going for us. Tourism is very important. People are always going to want to come to San Diego.”

The changing of the guard, from Owen to Mills, was smooth, he said.

“Ted Owen had been here for 15 years, and the paper was well-established, had a great foundation, a really good staff here, and the paper had a good reputation,” he said.

Mills said he’s also discovered over the years that accounting and journalism have a lot in common.

“Business journals are very people-intensive, as was public accounting,” he said. “There are a lot of similarities. Accountants, editors and reporters are very analytical, one with numbers, the other with words. And both are very suspicious. That’s what makes them good at what they do.”

He observed one more similarity between his two professions:

“Every Thursday we go to press , it’s April 15 and we can’t get an extension.”

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