Yosemite Sam/youtube.com

Quite possibly Alice Rogoff’s flirtation with Alaska journalism was destined from the beginning to end badly, though no ever really expected a woman on a $5 million per year allowance to take her business into federal Bankruptcy Court.

Then again, there was never any telling what Yosemite Sam, as she was affectionately nicknamed by those in the old Alaska Dispatch.com hangar at Anchorage’s Merrill Field, might do.

Life outside the box was her greatest strength. It would also turn out to be her greatest weakness.

She was a fountain of ideas that sometimes gushed irrationally.

No one could have predicted how the heady days at a feisty internet startup the Columbia Journalism Review described as a “regional reporting powerhouse” would fade into the disaster days of the bankrupt Alaska Dispatch News leaving those who trusted Rogoff’s business out about $2 million.

At Dispatch.com, there were good times and crazy times, but never any bad times. The business was all one big, generally happy, totally dysfunctional  family. There were children and dogs running around the newsroom, a kitchen stuffed with food, beer in the refrigerator and wine in the cupboard, and a deep sense of team.

Work was all about collaboration. Reporters were editing. Editors were reporting. And everyone was involved in coming up with crazy art ideas for staff artist Aaron Jansen. There were no real work hours or off work hours. Everyone seemed to be supercharged with energy and working all the time.

Dispatch was special ops. The Anchorage Daily News – only a few blocks to the north and east – was standard infantry and armor. The News had a rigid command structure and the responsibility to cover all the things that “had” to be covered in the old newspaper sense.

It was different at Dispatch.com. There was one simple rule of operation:

“The worst story you can write is the one nobody reads because it’s a waste of everyone’s time, energy and money.”

Dispatchers threw things at the wall to see what would stick.

They studied the internet and paid attention to what was – and just as importantly – wasn’t getting read, and they talked about how to do things better. They cruised the community and the state with eyes and ears wide open.

They tried to crash the server by generating too much traffic. And they tore down the old wall between the news department and the advertising department in the recognition everyone in the building had the same goal in the new world of the internet:

Survival.

Nowhere near perfect

Granted, the place never made money. Still, everyone understood that was the ultimate goal. Dispatch founders Tony Hopfinger and Amanda Coyne set out with that vision before Rogoff bought in. Hopfinger and Coyne wanted to build the first profitable, online news site in the country.

Rogoff was sometimes more of an impediment than a help. She had lots of money. She also spent lots of money. Some of it flowed toward her Arctic adventures which were an obsession.

The good thing was she went through the office most often on the way to the hangar to take her airplane out for a spin. The bad news was that she wanted in on running the business side of Dispatch.

She was a breath of fresh air, and she was a dust storm. She offered some great ideas for stories, and she offered some ridiculous ideas for stories.

Things on the business side tended to get wacky when she was there, but Hopfinger was usually able to clean them up after she left. She hired people she met no-one-really-knew where. One of the ad sales people traded a load of advertising space for boxes and boxes of biscotti. So for months, there was always biscotti on the counter.

Another cut a deal to swap months of online ad space for some new vehicles from a local car dealer. Leased cars, not owned cars. The ad saleswoman was very proud of herself. It took some effort on Hopfinger’s part to untangle that deal and get the online space back.

And then there was the business manager Rogoff wanted fired because the young woman had decided to date a man in whom Rogoff’s daughter was interested. There was always something crazy going on.

Once it was suggested the Dispatch might be able to make money by bringing in a film crew to turn the whole enterprise into an Alaska reality show. The place had characters. It had chaos. It sometimes had a little intrigue.

Given where everything was headed, the reality TV show might have been a hit because Rogoff made the business pretty entertaining even before the fireworks really began.

Into the fire

Rogoff had always wanted the Anchorage Daily News/ADN.com – the state’s largest newspaper and the biggest, baddest news site in the 49th state. The McClatchy Company of Sacramento, Calif., didn’t want to sell.

Why would it? The Daily News produced $10 million in profit for McClatchy in 2009, the year the company started laying off reporters and editors in Anchorage. The company badly needed the money. It had purchased the Knight-Ridder newspaper chain for $4.5 billion only three years earlier just as the news started rushing online.

McClatchy is still trying to recover from that purchase. It had for a time a cash cow in the form of the Daily News. McClatchy poured millions of dollars into the newspaper in the 1980s to defeat the Anchorage Times in one of the country’s last great newspaper war, and by the middle of the 2000s it was taking tens of millions of dollars out.

It kept the money flowing south as long as it could by steadily downsizing the newspaper. By 2011, the newsroom had shrunk from 104 to 34. The shrinkage to maintain profit-margin looked set to do nothing but continue, and then the ADN added a few bodies.

It was the first indication that the company was concerned about the steady online growth of Dispatch.com. Rogoff – encouraged by Dispatch staff who sensed an opportunity – decided the time had come make a serious play for ADN.

Negotiations were begun. Hopfinger suggested Rogoff engage a newspaper broker familiar with the ins-and-outs of newspaper sales. Rogoff rejected the idea as too costly. She negotiated without really negotiating. Mainly she went along with the suggestions of McClatchy, according to those privy to the discussions.

Eventually a price was agreed upon – $34 million. It was way too high. Alaska’s newest media visionary didn’t have the cash on hand to swing that sort of purchase despite her marriage to benevolent billionaire David Rubenstein back in Maryland and the $5-million-per-year spousal agreement that kept her comfortable.

So Rogoff cut a deal with old friend Ron Duncan, the founder of GCI, a telephone and cable company once known as General Communications Inc. Rogoff and Duncan had a relationship. They’d been classmates in the MBA program at the Harvard Business School, or so she reminded him when she arrived in Alaska. Pilots both, they subsequently agreed to share hangar space in the building that eventually came to house Dispatch.com.

In order to raise the $34 million for the Daily News, Rogoff agreed to sell Duncan the massive Daily News building on Northway Drive for $15 million, borrow another $13 million from Northrim Bank and cover the rest with her own or Rubenstein’s cash.

The building contained the Daily News’ printing press. The deal meant Rogoff would have to find somewhere else to print the paper, but GCI gave her an 18-month grace period to move out. After that, though the rent was due to begin increasing exponentially to provide her incentive to leave.

Don’t do it

Most of Rogoff’s closest advisers told her to dump the deal. The price was too high, they said, and buying a newspaper without buying a press was too risky. One business advisor would later voice the opinion it was the worst business deal with which he’d ever been involved.

But Rogoff could not be stopped. Her shopper instincts took over. She bought the Daily News, and the Dispatch celebrated. For most, the thrill of victory trumped any second thoughts. For a few long in the tooth who remembered the war between the News and the Times, there was a bit of melancholy.

The death of competition had been financially good for the News. It had not been good for journalism.  Consumers seldom benefit from the death of competition, but no one worried much about that.

The Dispatch was soon out of its funky, old hangar at Merrill Field and into the old ADN building, now GCI building, on Northway. Hopfinger had previously talked vital Daily News personnel – among them vice president for operations Ken Carter, the man who kept the press running, and circulation director Roger Weinfurter, the guy in charge of the oddball collection of carriers who made sure the paper was delivered – into joining the new company along with editor David Hulen.

Hopfinger brought with him to Northway a new vision for newspaper production. ADN would be run as an online news organization, as the Dispatch had always been run, and a group of copy editors would be given the authority to cruise the online news, pick out what they thought most interesting from that stream, and use those stories to build a daily paper.

It seemed so simple, but nothing was simple at the ADN. Nothing.

Marrying Dispatch.com and ADN was like trying to mate a wolf and a grizzly bear. They were both furry, four-legged animals that lived in similar territory often subsisting on similar foods. But they didn’t get along well.

Hopfinger underestimated the problem. He was confident the light, fast, highly collaborative Dispatch culture would trump the heavier, slower, top-down ADN culture. He was wrong. Reporters who’d been used to finding and doing stories pretty soon found themselves waiting on orders from editors deciding which stories should be covered.

A Dispatch culture that thrived on open discussion, sometimes outright disagreement, was buried in a culture where the prime objective was for everyone to get along all of the time, or at least appear to get along.

Neither view was right or wrong. They were just different.

New boss

Meanwhile, Rogoff, who’d been a visitor at the Dispatch, moved in at the ADN, now partially rebranded as the Alaska Dispatch News. When some of her friends complained that editors on the editorial desk were fact checking commentary, Rogoff told them to stop it.

Hopfinger, by then the president of the Alaska Dispatch News, suggested Rogoff hire a publisher or general manager to run her new business and insulate her from the news operation.  She refused. She wanted to be in charge.

Sometimes she was; sometimes she wasn’t. She refused to deal with the obvious and immediate financial problems. Before the Dispatch moved in with the ADN, Hopfinger outlined the staff and budget cuts he thought necessary to keep the ADN turning a profit.

Rogoff rejected almost every suggestion. Cuts, she said, would look bad. She didn’t want to look bad.

When controversies blew up, as they inevitably do in the news business, Rogoff worried about the public reaction, especially from her peer group.

All of a sudden the woman who had relished controversy at Dispatch.com wanted nothing so much as to avoid most controversy at the ADN. The end result was to encourage reporters to do less because the less they did the fewer the chances to get into trouble.

If that wasn’t enough, the ADN advertising department was scrambling to patch up problems leftover from the sale because Rogoff had refused to hire that broker. When McClatchy left Anchorage, it took funds from national advertising accounts with it along with proprietary products like the Cars.com and CareerBuilder.

But those were all small problems compared to the bigger problem.

A new home

The ADN’s big problem was finding a home.

Having sold the Daily News building, Rogoff needed a place to put her employees and a press. She looked at a warehouse off the Seward Highway near Dimond Boulevard, an office building on 36th Street in Midtown, and came close on a deal to move into the old campus of the Alaska Air National Guard at once was the Kulis Air National Guard Base on the south side of Ted Stevens International Airport. 

Royal Dutch Shell, which then had high hopes of discovering a major new oil field in the Chukchi Sea, had already settled into offices just down the street at Kulis. There was some thinking an old airplane hangar there could be modified to hold a press.

As it turned out, the concrete foundation for the hangar wasn’t stout enough, and the old Kulis offices Rogoff looked at had some problems requiring repairs. She eventually ended up moving most of the ADN operation into offices on C Street in Midtown. The new offices cost more than what she had been paying to stay at GCI.

And there remained the problem of no press.

Hopfinger negotiated a deal with Morris Communications to build a printing plant. Morris at the time owned the Alaska Journal of Commerce, the Eagle River Star and the Peninsula Clarion, along with Alaska Magazine and a variety of other publications. It was looking to start an Alaska print operation.

ADN was to chip in a small part of the cost of construction. In return, it would get a 10-year contract on print costs with an option to renew daily printing at the end of a decade or switch to once-a-week publication of the on-paper product. Hopfinger, a guy who started an online startup where the motto was “we don’t do dead trees,” thought it a near perfect deal.

With half of Americans under age 50 already getting most of their news online and only 5 or 10 percent still turning to newspapers, Hopfinger reasoned the time had come to prepare for a future shift away from print. Rogoff killed the deal.

Hopfinger started negotiations with Wick Communications, which had a press in the Matanuska-Susitna Valley on which it printed the Mat-Su Valley Frontiersman and The Anchorage Press. Rogoff spiked that deal as well.

Future view

Rogoff wanted her own press and eventually she found one in Indiana. It was shipped to Alaska in 2016. Rogoff leased an old, oil-field services warehouse on Arctic Boulevard for a print shop.

Millions of dollars were spent moving the press in and preparing the building. Rogoff was already in deep, financial trouble when she invited consultants from another newspaper in to look at her plant. They thought it would cost still more millions to get the press running.

Meanwhile, what had been a very accommodating GCI was getting tired of playing host to Rogoff’s only functional press, and the rent was going up. Her response was to stop paying.

At that point, all the bad decisions dating back to the original purchase became part of a fatal cascade. Rogoff was well down the path to turning a company worth $34 million in her eyes in April 2014 into a company worth only $1 million in the federal Bankruptcy Court in Sept. 2017.

It was one of the most spectacular business failures in recent Alaska history.

Behind in the wreckage, Rogoff left some interesting questions that touched not only on the business of journalism, but the focus of journalism about business and the very different lives of those Americans now referred to as the “1 percent:” 

• How was it the downward spiral of the state’s largest news organization went largely unreported in the state’s mainstream media until only weeks before a bankruptcy filing despite the obvious signs of problems?
• What becomes now of adopted Alaskan Rogoff, a woman who hosted President Barack Obama at her Anchorage home for dinner, advised Alaska Gov. Bill Walker on fiscal policy and enjoyed a long friendship with Alaska Lt. Gov. Byron Mallott?
• And what role, if any, did the reportedly impending divorce of Rogoff and her long estranged husband, Rubenstein, play in Rogoff’s decision to stop subsidizing the news operation she hoped to turn into an Alaska media empire?

Multiple confidants of Rogoff, all of whom asked for anonymity, have told craigmedred.news that she and Rubenstein are headed for divorce, although the Rubenstein camp offered a non-denial denial to the Washington Post after the East Coast newspaper noted reports of filings in the ADN bankruptcy revealing the 68-year-old Rubenstein and the 65-year-old Rogoff have a marital agreement.

“That kind of agreement is usually a precursor to divorce — in which a married couple spells out how they’re going to handle things like property division, child custody and spousal support,” the Post reported. “But a person familiar with the arrangement says in this case, no divorce is currently in the works and that the agreement provides for Rubenstein’s annual payments to his wife, a use of marital settlement agreements sometimes employed by married rich folks who want separate finances. It’s been in place for ‘many, many’ years, the source says.”

So much money

Rogoff friends and associates, and former friends and associates, told craigmedred.news that Rogoff gets $5 million a year tax free as part of the agreement with Rubenstein. For more than two years, she used a big chunk of that money to subsidize her pet Alaska project – the ADN.

At the bankruptcy hearing, her lawyer, Cabot Christianson, revealed Rogoff pumped $3.8 million in cash into the ADN in 2015. Another $4 million followed in 2016. 

At the time, Rogoff publicly described herself as in “investment mode.”  On the witness stand and under oath at bankruptcy hearings last week, she was asked about the ADN’s steady financial losses. She explained them away as expected, as an “investment in something…working for quality journalism.”

Her investing ended earlier this year. Christianson asked her why at a Monday hearing.

“I simply had no further ability,” she said.

No one seems to know what happened to end her ability to subsidize.

Some old friends of Rogoff admit to being angry about how she let the ADN slide into an abyss once she could no longer support it. Running the business dry of assets is going to make resurrection harder for the Binkley Company LLC, headed by Fairbanks’ Ryan Binkley.

The Binkleys have no choice but to significantly reduce the size of a news operation losing $500,000 per month. Job cuts are an inevitable part of the equation.

Some who’ve known Rogoff for a long time cannot understand why she never tried to move the ADN toward solid financial footing, or why she allowed it to reach the point of being forced to close the doors before she finally cut a deal with the Binkleys.

In court, she described her behavior as an attempt to “protect” the people working for her. The people, or at least some of  them, ended up being saved by the Binkleys who lent Rogoff $1 million to keep the company alive long enough they could get it through bankruptcy and begin to restructure.

“We are fortunate that this legal (bankruptcy) process exists, giving a company like ours protection from creditors while reaching for a solution to the most urgent challenges,” she wrote at ADN on Tuesday. “Of course, I am deeply sorry there are vendors whose bills will go unpaid. And I dread the prospect of layoffs at the paper that will be necessary for it to survive under its able new owners. These are the hard realities of business gone bad.”

Puppet master

Some friends and former friends of Rogoff are angry at Rubenstein, who they believe could have cleaned up his long-estranged wife’s Alaska mess but refused to do so. Rubenstein is worth an estimated $2.5 billion. He spent $21.3 million to buy the Magna Carta in 2007.

“He told reporters he was just a ‘temporary custodian’ of the historic piece of parchment, which David Redden, Southby’s vice chairman, called the ‘the most important document in the world, the birth certificate of freedom,” the New York Times reported at the time.  

In 2016, Rubenstein gave the National Park Service $18.5 million to help restore the Lincoln Memorial. In private, Rogoff has described those acts as publicity grabs and claimed all her financier husband really cares about is making money.

Rubenstein has not responded to emails. Rogoff’s consistent public statements have been “no comment.” She had not talked publicly about the bankruptcy, other than as a witness in court, until Tuesday in the ADN.com commentary.

Some familiar with the Rogoff-Rubenstein relationship believe the couple are engaged in some sort of high-stakes positioning leading up to a divorce settlement. Rogoff, in discussions in which this reporter participated, several times over the years expressed the belief she is entitled to half of Rubenstein’s billions.

Rogoff friends and associates schooled in this line of thought and aware of Rubenstein’s vast wealth are dismayed that he didn’t step in to help save her Alaska news project.  Had someone other than Rogoff taken charge of securing ADN a printing plant – a proposition significantly less costly than restoration of the Lincoln Memorial – other publishers believe the ADN would have been able to avoid bankruptcy.

And the print plant – a problem with which the Binkleys are now wrestling – is really where the story of the downfall of Rogoff’s ADN begins.

And where it ends.

The money Rogoff spent in three years at ADN would have kept the Dispatch going – even if it never turned a profit – for 50 years. But Rogoff craved the seeming power of the press, and now all she can do is apologize for how her run ended, and blame bad luck.

“When I bought the Anchorage Daily News in 2014, Alaska was full of promise, as I was,” she wrote. “Oil was at $120, our state’s budgets were growing and prosperity was in the air. Fresh from having grown the digital-only Alaska Dispatch from a seedling, I thought our mission of providing more journalism and expanding the paper to a statewide focus would transform it into something bigger and better than before.”

In the end, though, all she made of it was a train wreck.

(Editor’s note: The author was a reporter at AlaskaDispath.com from 2010 until it purchased the Anchorage Daily News. He was for most of that time a good friend of Alice Rogoff. He was at the Alaska Dispatch News from 2014 to 2015. His career at the ADN ended after he caught a state official allegedly committing felonies. He had been told to stop investigating Roland Maw, a member of the Board of Fisheries. Maw is slated to go on trial in November. Maw faces charges of illegally obtaining Alaska Permanent Fund dividends.)