UPDATE: Our latest story on these firings can be found here and includes new revelations, including screenshots of CEO Farhan Mohamed instructing journalists to promote co-owner Andrew Wilkinson’s other company, and asking them to write thank you’s to advertisers into editorial copy. Editor Jimmy Thomson refused both orders, and was fired within a week. “I’d call that timing highly suspicious,” says Paul Gott, a journalism professor at Concordia University and a TV news producer. “It seems like an obvious tit-for-tat.” Read the full investigation.

“When we look at these communities, our goal is to be around for the next 30 or 40 years,” explained Farhan Mohamed in a friendly 2021 Guardian profile. “We think in a generational sort of way.”

As it turned out, the honeymoon was closer to 18 months for the CEO and co-founder (with reported billionaire Andrew Wilkinson) of Overstory Media Group.

As recently as last year, the pair were promising to revitalize local journalism across Canada and committing to a model that would eschew short-term profit-based thinking. Some wondered aloud if these brash tech bros could be the solution to what ailed local news.

On Monday, Capital Daily, an innovative and award-winning local outlet in Victoria, B.C., that the Guardian described as Overstory’s “marquee brand,” was gutted like a fresh trout.

In a move that sent shock waves through the country’s journalism community, four of the outlet’s seven full-time staff members were fired, including managing editor Jimmy Thomson. As many as six other employees or contractors had already been fired or seen their contracts go unrenewed over the past few months. An award-winning outlet that routinely punched well above its weight and broke major stories, flopping around on the deck. Bleeding out.

In retrospect, the only answers Mohamed and Wilkinson seemed to have were buzzwords and never-ending layoffs. A slight dip in long-term projected revenue, and perhaps a union drive, spooked Overstory management so badly they panicked and maimed a profitable outlet. Unwilling to take responsibility for their actions, they’ve spent the past week sowing confusion about the outlet’s finances.

Ricochet has spoken to over half a dozen current and former OMG employees for this story (who have requested anonymity for fear of retaliation), a spokesperson for the newly formed employee union and Mohamed himself. We’ve listened to a leaked audio recording of a Dec. 5 all-hands meeting and confronted Overstory management about a surprising number of discrepancies in their public statements.

Fighting about money

In response to a furious backlash, Wilkinson took to Twitter on Wednesday to plead poverty, telling readers that OMG “has lost over $5,000,000 over the past few years and continues to lose money. Most of that was my personal money.”

In a spree of several dozen defensive tweets, Wilkinson repeatedly describes the firings as a necessary consequence of the outlet’s failure to make money, and seemingly conflates Capital Daily’s finances with those of its parent corporation.

We made the decision to cut back our expenses due to the fact we were losing too much money.… Chek’s [a TV station in Victoria] revenue also needs to exceed their monthly costs. If enough advertisers don’t buy ads on Chek, they would have to make layoffs too.… At the end of the day, the reality is that a business has to deliver more revenue than the expenses to run it.… The business only has six months of cash in the bank, so we had to make a decision to make cuts.

Having six months of cash in the bank is pretty standard for a successful media outlet, something Wilkinson seems not to know. But it wasn’t always about profits for the billionaire. When Wilkinson announced the Capital Daily project in late 2019, he described it as “something philanthropic.” A way to give back to the community.

For his part, Mohamed first told Ricochet the firings were due to a “change” in Capital Daily’s “financial situation.” When presented with an audio recording of him telling a staff meeting in December the outlet’s revenue had been steadily increasing for the past two years, he offered a new answer. “Capital Daily is seeing a 30-45 per cent decline in revenue this year.”

According to multiple sources with knowledge of internal finances, the outlet is currently making $20,000 a month in profit, and the decline in revenue Mohamed is referring to is a projection of what may happen six months or more in the future, based on a dip in advance ad sales. OMG may be losing money, but Capital Daily isn’t, and even in the worst-case scenario it would remain profitable for many months. Mohamed stopped responding when Ricochet asked him what the basis for these projections was.

“It was profitable,” says Martin Bauman, a reporter and spokesperson for the fledgling OMG union. The union plan had been in the works for some time, but the announcement was rushed up to this week in response to the mass firings. Bauman used to work at Capital Daily before being transferred to The Coast, an OMG site in Halifax, last year.

“That was the message I got, consistently. The message within the organization has been, consistently, that Capital Daily is the exemplar for every other publication to follow. They have been held up as the model of success that everyone else should be striving towards.”

And they were doing it with in-depth, investigative and long-form journalism and innovative local newsletters — not cat videos and contests.

But all wasn’t well below the surface at OMG. Sources describe an increasingly toxic workplace, with Mohamed interfering in editorial decisions and pushing employees to abandon award-winning longer-form journalism in favour of short, snappy daily news type articles. He denied these allegations in response to questions from Ricochet, but comments he made on the leaked recording are consistent with the experiences described by multiple OMG sources.

Many employees and former employees were compelled to sign non-disclosure agreements and non-disparagement clauses, and now fear being sued if they speak out.

Bauman also expressed concern about the expectations being placed on employees.

“Part of this effort by me and my colleagues here for a union is recognizing that there has to be some understanding of what any one of us is actually capable of producing in the course of a day.”

Pivoting to events with millionaires

Within an hour of firing a majority of the staff at his flagship publication, Mohamed fired off a joke tweet to promote an upcoming OMG event featuring co-founder Wilkinson in conversation with some other tech bro millionaire.

“Tone deaf,” responded National Observer editor-in-chief Karyn Pugliese.

In December, three journalists were fired from their positions with other OMG properties, making a total of at least seven journalists now fired across the chain in two months. A number of other contract employees have also been let go without replacement as their contracts expired. One OMG outlet, the Burnaby Beacon, shed almost half its staff last year.

Of three full-time employees remaining at Capital Daily, one is an intern and another is an investigative journalist. Two other OMG employees with distinct newsletters and brands often see their content pulled into Capital Daily newsletters. Wilkinson has claimed them as employees of Capital Daily, but they do not work for the outlet. Amazingly, Mohamed has indicated that he expects the daily newsletter to continue with no reduction in frequency.

“I’ve always loved the news and wanted to give back,” said Wilkinson in a 2021 statement. “Now through OMG, we get to help others create in their community.”

Fired staff were lead union organizers

The plot thickened Tuesday, when OMG employees announced that they had voted by a significant majority to form a union under CWA Canada.

OMG sources confirmed to Ricochet that three of the four fired employees were lead organizers with the union effort. Of eight members of the organizing committee, three were fired on Monday. Another was let go late last year.

“It would concern me if in any way it was targeted,” added Bauman, referring to the firing of half the organizing committee. “I don’t know that to be the case, and I would like to assume that this is all just a terrible coincidence of timing, but we will have our lawyers look at this and ask those questions.”

In emails with Ricochet, Mohamed denied that the employees were fired in retaliation for their union activities.

On Twitter Wednesday, Mohamed said he was unaware his staff were organizing to join a union. Wilkinson, meanwhile, tweeted that “we had heard they were talking about unionizing since spring.” Mohamed did not respond to a request to explain this discrepancy.

Going down swinging

It’s an early December afternoon, and Mohamed is fielding questions about OMG’s latest round of layoffs at an awkward all-hands meeting. He’s preaching that their product is “community,” whatever that means, not journalism, and he’s spouting tech bro nonsensisms straight out of central casting.

“You are a personality here. You are a brand. How do we leverage that? How do we think about you connecting in the market?”

Maybe less journalism is the answer, Mohamed muses.

“Do we need to be publishing X amount of stories on a daily or weekly basis? And if they’re not moving the needle, then why are we doing what we’re doing?”

If there’s one perfect example of the shining city on a hill Mohamed wants to build though, it’s Capital Daily. Because they make bank. He holds them aloft repeatedly as an ideal for others to aspire to.

“I’ll take Capital Daily as an example. We were making $500 a month in October/November two years ago. And within two months we were making ten times that, so we were at $5,000. And today Cap Daily, from an ad revenue standpoint, is doing over $50,000. A month. That happened quickly, so we want to follow that same trajectory (with other outlets like Burnaby Beacon).”

The questions from staff are pointed, but restrained. Then the Capital Daily editor’s turn comes.

“Yeah, uhm, I mean…” he repeats three times in quick succession, like a nervous tic, then he sighs and lets out a little chuckle. You can almost hear him deciding that some things are more important than a pay cheque.

At this point, Thomson launches into a passionate speech defending his staff and the craft of investigative journalism, and arguing that the root cause of Capital Daily’s success is their commitment to long-form journalism.

“I just want to give kind of an internal perspective on that growth,” he says before calling his boss a liar in perhaps the politest terms possible. “Especially sort of in contrast to the way you’ve been putting it.”

“I get stopped in the street because people are like ‘thank you for the work that Capital Daily is doing.’ And they’re talking about the investigations and the long-form stuff.

“They’re not talking about our involvement in the community, they’re not even talking about our amazing newsletter. They love that, but…”

Thomson’s voice is swelling, and the passion is palpable.

“Really what they value, what they’re bragging to their friends about, and showing to people, and really appreciating about the work that Capital Daily does is that long-form investigative … the work that isn’t being done by every other media outlet in the city.”

Six weeks later, Thomson and half his staff were fired.

“It’s very in character for Jimmy to stand up for his craft and employees like that,” says another former Capital Daily employee. A different OMG source added that Jimmy routinely went toe-to-toe with Farhan to defend his team and their work.

“I’ll be very curious to see what they manage to turn OMG into from here,” added the former employee. “Aside from being cruel, laying off the core staff with no conversation or announcement seems like an absurd business decision.”