Parkhill folds over funding shortfall

“Hold the front page” took on a whole new meaning last week when Eve Pollard’s magazine company Parkhill began to seek voluntary liquidation, just one year after its launch.

The latest issue of Aura, a women’s magazine targeting the relatively untapped over-30s market, was scheduled to hit newsstands on August 3. But the fledgling publishing company has postponed the magazine, as well as the next issue of sister title Wedding Day, due out next week, and sent 25 staff home.

A statement issued on Parkhill’s behalf by Brown Lloyd James, the PR company run by Pollard’s husband Sir Nicholas Lloyd, says: “Current information indicates that Parkhill is solvent, but moves have begun to appoint a liquidator in order to seek voluntary liquidation.”

The same statement claims “negotiations are continuing with several companies interested in the possible purchase of the titles”.

It is understood the company has been seeking a purchaser for the past four weeks, after it became apparent that a &£2.5m seed fund through venture capitalist Phildrew Ventures was not going to be increased. Other investors, including former Sunday Express editor Pollard, are believed to have invested &£500,000 in the company.

Pollard set up Parkhill in June last year and revealed plans to launch six titles in three years.

Wedding Day was the first to hit the newsstand in November, with a 45,000 sales target.

Parkhill launched Aura in May and guaranteed press buyers a 130,000 circulation. It claims to sell about 100,000 copies.

The company was to have launched a celebrity magazine later this year with the help of Pollard’s old friend Wendy Henry, a former editor of News of the World and Sunday People.

Pollard admits: “We have two good magazines that readers like, but we needed more backing to publish additional magazines, and for sales promotion, and could not find it in time.

“The barriers to entry for small, independent publishers of upmarket, glossy magazines are formidable and we needed more investment to make Parkhill profitable.”

Signs of difficulties emerged when ad director Jane Sproul, who joined from Associated Newspapers, resigned in April on the grounds that her workload involved in a continuous programme of launches was unfair to her family (MW April 27).

Sproul’s resignation coincided with an announcement that Aura editor Deidre Vine was to scale down her hours and step down from the position. This was swiftly followed by the departure of group advertising director Fiona Davidson in May after a bust-up with Pollard (MW June 1).

The departure of the key advertising staff must have left its mark. One press buyer says: “If they were selling enough space, they would have kept Aura afloat. After the launch, we hardly saw anyone. Advertising staff need to be in your face constantly, particularly with a new publication.”

MediaCom TMB director of press Steve Goodman suggests a way to avoid the problems associated with maintaining a dialogue with agencies: “Rather than starting up their own sales houses, these small start-ups can cut costs by using the services of sales organisations such as The Publishing Consultancy.”

Editorially speaking, Wedding Day met with general approval. But to some Aura appeared dated; others said it had more in common with newspaper supplements than glossy, upmarket magazines – reflect ing Pollard’s own experience of publishing.

MediaVest client services director Nigel Conway says: “Aura is an incredibly brave magazine to launch. But the editorial was probably a bit too direct, and too true. If you are getting on, you don’t want to see articles about getting older. Everybody wants to be young.”

Sally O’Sullivan, chief executive of another high-profile start-up, Cabal Communications, says: “If you are going to support ad teams and circulation, IT and central overheads, it’s about critical mass.

“We always knew from the start that we needed to get two pretty big magazines out there selling more than 100,000 each.”

Justine Southall, publisher of BBC Worldwide’s Eve magazine, says: “Parkhill’s business costs would have been higher because it doesn’t have the leverage of larger publishing companies.

“It’s a blow for these entrepreneurial magazine start-ups. It sends out a signal that unless you are one of the big players you can’t do it.”

With no products on the street and no track-record, publishers find it significantly harder to maintain buyers’ interest in launches.

O’Sullivan claims Cabal broke even in March – 18 months after its launch – and its Audit Bureau of Circulations and National Readership Survey figures have helped to increase ad revenue by 100 per cent year on year.

She adds: “The other thing that gave us an advantage was the fact that we started with private finance from individuals.”

O’Sullivan claims to have retained the option of venture capital funding, as well as going the route of former GQ and Loaded editor James Brown, who floated his publishing company, IFG, on Aim.

If Aura and Wedding Day miss issues so crucial to the establishment of new titles, it seems unlikely they will be rescued from the hands of the liquidator.

However, Pollard is sure to resurface as a media pundit on TV. As in the past, she could always use her experience to write a blockbuster novel about starting up a magazine company. With a different ending, no doubt.