When Forbes magazine was established, it became the voice of the investing public, reporting, interpreting, and commenting on the accomplishments and failures of American business leaders and their companies.
Professional managers, investors, and others interested in knowing how business events help shape their lives turn to business periodicals for both information and entertainment. Although dozens of important magazines and journals are devoted to satisfying the demands of this special readership, at the end of the twentieth century three of them—Forbes, BusinessWeek, and Fortune—owned the lion’s share of the market. The oldest of these, Forbes, was launched in 1917, more than a decade earlier than either of its two major competitors.
B. C. Forbes founded the magazine that bears his name. A man possessed of many talents, interests, and ambitions, he at first wished to name his periodical Doers and Doings because that title reflected his philosophy that individuals make companies and markets. This worldview was a product of his experience as an apprentice printer’s devil in his native Scotland and later as a reporter for the Rand Daily Mail in Johannesburg, South Africa. After his arrival in the United States, Forbes quickly rose to prominence in the investment and journalism communities through his syndicated columns for the Journal of Commerce and subsequently for the daily New York American. Forbes was an outgrowth of his fecundity in both newspaper and magazine journalism.
The American business press has a long and distinguished record of achievement, consistently and successfully identifying and adapting to changes in the economy, commerce, industry, and the workplace. The earliest business publications were known as price-currents. Edited by commodity brokers and commission merchants, they provided businesspeople with wholesale commodity prices and basic shipping information. In the early nineteenth century, they evolved into publications that reported intricate commodity and maritime data and offered commentaries on market conditions and occasional analyses of commercial problems.
The growing role of financial capital in the mid-nineteenth century was met with increased interest in news about banking and investment matters. Two premier financial papers founded during this era were The Wall Street Journal and The Commercial and Financial Chronicle. It was in this milieu that B. C. Forbes both cut his journalistic teeth and learned the business lessons he needed to launch and develop an important new magazine. In time, Forbes would serve as a model for business journalism in the twentieth century.
As a reporter for the Journal of Commerce and other daily newspapers, Forbes recognized that the business press was characterized by good writing and strong news gathering, analysis, and interpretation. As a gifted writer, he brought talent in these areas to the new venture. He also noted, however, that many business leaders of the day were excessively secretive in their commercial dealings, and thus little of the most important information about individual companies and their dealings found its way into print. Cognizant of this, many potential readers found business publications of almost no value beyond the statistical data they reported.
As both a journalist and an entrepreneur, Forbes knew that for his magazine to prosper, he would need to bring the knowledge and insights of leading investment bankers and businesspeople to bear in each article. The formula that provided Forbes with its early, and lasting, success blended crisp writing, formatting, and presentation with inside sources of information, a view of the human side of each enterprise, a willingness to make predictions, and a desire to represent stockholders’ interests. This approach would be emulated successfully by dozens of other periodicals.
The initial success of Forbes and many of its early rivals in the business press can be traced to economic and cultural factors present in the United States at the beginning of the twentieth century. Among the more notable were revolutionary changes in distribution and manufacturing processes, new inventions, and the scientific management movement. As a disseminator and interpreter of information about changes in American industry, the business press served as an invisible classroom, and the publications’ editors served as teachers for a population hungry for information on how to advance in their careers and make prudent choices about investments and lifestyles.
As an entrepreneur and journalist, B. C. Forbes recognized that he could make an important contribution in this exciting era by using his prodigious writing talent and his many sources in the investment banking community to report on the achievements, failings, and foibles of business leaders. He recognized that businesses often neglected stockholder interests, and he was concerned with reporting such disregard. From the outset, the Forbes publishing formula combined popular folk wisdom that sought to harmonize the managerial process with a tough, biting, investigatory approach that often upbraided poorly performing companies and their managers. This approach characterized the editorial policies of the magazine through three generations of family management and found favor within the journalistic community. An illustration of the Forbes publishing style is each issue’s “Fact and Comment” opinion piece, which was frequently acerbic, written in the free-spirited style that characterized the lives of the publishers.
Forbes’s contributions to the business press extended far beyond his important achievements on the editorial side of journalism. His many innovations as a publisher were also of seminal value. His early experiences made him painfully aware that failing to make significant changes on the “business side” of publishing would have dire consequences not only for his new venture but also for the entire arena of business journalism. He knew that even though business periodicals of the era had lives far longer than those of popular magazines, those lives were still painfully short. Many periodicals lacked any specific purpose: Their editors and publishers were not truly in touch with their audience. Magazines depended too heavily on subscriptions as a source of revenue, and subscription prices were excessive. Advertising was negligible. Advertisers could not be expected to promote products to an ill-defined audience. These conditions, along with faulty distribution processes, especially through the U.S. mail, discouraged entry into the field.
Although Forbes could not remedy all these ills, he made significant inroads. Among his most enduring accomplishments were defining his audience and ensuring that its interests were represented in each issue of the magazine. This strategy of carving out a market niche of prosperous, well-educated readers served to increase circulation and advertising revenues and placed the magazine on a path of dynamic growth. He also improved production and distribution processes, but major advances in this area were left to his son Bruce. Later, his son Malcolm, through extensive promotional efforts and effective reporting, turned the magazine into the “capitalist tool” it claimed to be as well as a model for modern business magazines.
The years of the Great Depression were not kind to B. C. Forbes and his founding copartner, Walter Drey. Their magazine’s fortunes ebbed in direct proportion to the number of individuals interested in investment matters during this bleak period. For a time, Forbes employees worked one week each month without remuneration. Forbes himself did not draw a paycheck for much of this era. Subscriptions fell to sixty thousand. Like its competitor Fortune magazine, Forbes devoted many issues to bolstering the sagging spirits of American business leaders.
In the years following World War II, B. C. Forbes’s sons Bruce and Malcolm ascended to senior leadership positions within the organization. The congenial Bruce Forbes made important advances in strengthening operating and marketing functions. In the nearly ten years that he was at the helm, the magazine’s circulation almost doubled. The editorial side was enriched with the addition of Byron (Dave) Mack and James Michaels. As an editor, Michaels in particular emphasized investigative reporting and sought to make the magazine more controversial and outspoken on behalf of investors.
Although Malcolm Forbes devoted much of his time to winning political office, two of his strategic ideas altered the future of the magazine. First, in an effort to bring more consistent quality and focus to the magazine, he suggested replacing freelance writers with a permanent editorial staff. Second, as a way of increasing January advertising revenue and competing more directly with Fortune, he proposed an issue that would rank corporations not only by revenue (as in the Fortune 500) but also by such measures as profitability and return on equity. This early fascination with lists continued. Later, Forbes’s rankings of the four hundred richest Americans catapulted the magazine to new heights of popular recognition and acceptance.
Upon Bruce Forbes’s death in 1964, Malcolm, who was functioning as editor in chief, assumed complete operating control of the magazine. Known for enjoying considerable promotional skills, Malcolm Forbes is also remembered for his dynamic leadership on the editorial side. During his tenure, Forbes became an even greater proponent of shareholder interests. Toughly worded commentaries, in-depth investigations, and incisive reporting often lambasted business leaders for their ineptitude and general neglect of the true owners of their corporations, the stockholders. By 1983, Forbes had tripled its advertising revenue and ranked eighth among Ad Week’s leading magazines. The Magazine Publishers Association named Malcolm Forbes publisher of the year in 1984. This recognition came at a plateau in the magazine’s history; soon, Forbes would lose market share to competitor BusinessWeek.
After Malcolm Forbes’s death in 1990, his son Steve Forbes (Malcolm Stevenson Forbes, Jr.) took over his father’s position (from 1982 to 1990, the younger Forbes had served as the magazine’s deputy editor in chief). Steve Forbes’s many talents and interests served the magazine well, helping it to maintain its place among the leading business periodicals.
Forbes earns high marks when evaluated by most measures of organizational success. The magazine survived when others failed, brought enormous financial rewards to its owners, and enjoyed almost universal recognition and public acclaim. Forbes’s many imitators and the robust health of business journalism are testimony to the magazine’s accomplishments. Forbes’s impact, however, extends well beyond the magazine’s institutional boundaries. Its significance lies in its contribution to enlarging and enriching the public debate on matters of vital economic and financial interest. The depth and detail of its articles, its editors’ willingness to take the risks of prediction and to take positions that could be damaging to the magazine, and a professional approach to publishing earned Forbes its preeminent position in the world of communications.
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Forbes, Malcolm S. Fact and Comment. New York: Alfred A. Knopf, 1974. Collection of the writings of Forbes’s longtime owner and editor in chief. Columns written over a twenty-five-year period illustrate how the magazine reacted to and attempted to influence important events of the day. -
_______. More Than I Dreamed. Edited by Tony Clark. New York: Simon & Schuster, 1989. An autobiography that reveals Forbes’s many talents and interests. Chapter 1 provides an invaluable brief history of the early days of Forbes and the life of B. C. Forbes. -
Forsyth, David P. The Business Press in America. Philadelphia, Pa.: Chilton Books, 1964. Although the 1750-1865 period covered predates Forbes’s launching, this scholarly work is indispensable for understanding the early business press and, more specifically, the financial periodicals extant before World War I. -
Kohlmeier, Louis M., Jon G. Udell, and Laird B. Anderson, eds. Reporting on Business and the Economy. Englewood Cliffs, N.J.: Prentice-Hall, 1981. The contribution to this collection by James W. Michaels (who served as a Forbes editor) on business magazines provides insights into the workings of the editorial side of Forbes and other important business journals. -
Tebbel, John, and Mary Ellen Zuckerman. The Magazine in America, 1741-1990. New York: Oxford University Press, 1991. A thoroughly researched and well-written book that will appeal to both scholars and general readers. -
Winans, Christopher. Malcolm Forbes: The Man Who Had Everything. New York: St. Martin’s Press, 1990. An entertaining and thoroughly researched work about the life of the man most responsible for the growth and development of Forbes. Valuable information about B. C. Forbes is presented in chapter 2.
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