Austin Russell became the youngest self-made billionaire in 2021; now he owns Forbes
Austin Russell is on quite a run.
The 28-year-old founder and CEO of Luminar, which develops vision-based lidar and machine perception technologies primarily for self-driving cars, told The Wall Street Journal earlier today that he is buying an 82% stake in Forbes Global Media Holdings in a deal that values the company at nearly $800 million.
According to the WSJ, Russell's stake includes the remaining portion of the company owned by its namesake family, which sold 95% of the company to the Hong Kong-based investor group Integrated Whale Media back in 2014. Forbes was essentially on sale from the moment it called off its merger with a special-purpose acquisition company in June of last year, after the market soured and investors lost their appetite for SPACs.
Luminar itself had better timing; it went public via a SPAC merger in 2021 when retail investors were still clamoring for shares in mobility tech companies. Still, by the time Forbes was calling off its own SPAC plans, nearly every mobility SPAC was trading below its offering price, and Luminar has not been immune to the broader downturn. Valued at $3.4 billion when it hit Wall Street, its market cap is now roughly $2 billion. Just three days ago it reported slightly wider than expected losses.
Some retail investors might not be so happy about its performance, even while Russell told the Silicon Valley Business Journal last year that he had no regrets about the SPAC. (From his perspective, the alternative would have been to potentially run out of money, as private market investors began to snap shut their checkbooks.)
Others might find it concerning that Russell -- described by Forbes itself in 2021 as the world's youngest self-made billionaire -- will soon be directing some of his attention elsewhere.
Shareholders -- and Luminar employees -- may also find the acquisition confusing.
While it has become fashionable to dabble with more than one company at once (Elon Musk, Jack Dorsey), as well as to be a billionaire owner of a media company (Jeff Bezos, Laurene Powell Jobs, Marc Benioff), buying Forbes when so many outlets are fighting for survival bucks conventional wisdom.
Then again, Russell has been focused on Luminar since 2012, when he dropped out of Stanford to start the company, aided by a $100,000 grant from renowned investor Peter Thiel. (The Thiel Fellowship program, founded in 2011, continues to give $100,000 to select students who are eager to spend two years on their idea instead of "sitting in a classroom.")
Russell has enjoyed the fruits of his work in the ensuing years. He purchased an $83 million Los Angeles spread in 2021 that has since been featured in the hit show "Succession." He also reportedly paid another $10.6 million for a 13,000-square-foot mansion in Winter Park, Florida, near Luminar’s Orlando headquarters. But after spending his entire career focused on Luminar, he could well be looking to alter how he invests his time.
As Y Combinator's Paul Graham once said as he expressed his distaste for funding founders who are especially young, sometimes the worse thing that can happen to a person is that his or her startup succeeds straightaway.
Said Graham: "[I]f you start a successful startup, like, the footloose and fancy-free days of your life are over. You’re working for that company.”
In a statement to the WSJ, Russell said simply of his motivations that: “Forbes is something I had always looked up to as a brand and as a media empire." He also told the outlet that he doesn’t plan to get involved in Forbes’s day-to-day operations but that he wants to both grow the outfit and emphasize "philanthropy" within the business.
TechCrunch reached out to Russell a bit ago; we were referred to a press release about the acquisition and told Russell has no further comment for now.