A new weekly paper is scheduled to hit Orange County's already crowded business publication market Sept. 8, headed by a trio of veteran business journal executives and financed by an investors group that includes a former mayor of Laguna Beach.
But the publication, Orange County Businessweek, may be dogged by the checkered financial history of one of its three founders--publisher Gary Dunham.
In Nashville, where Dunham started and then sold a similar business newspaper earlier this year, at least a dozen creditors are seeking an estimated $50,000 in unpaid bills, lease payments and bounced checks from his publishing company.
And distribution of the proceeds of the sale of a Sacramento business paper Dunham started in 1984 and sold the same year has been hung up in an out-of-court dispute over the accuracy of circulation claims for the publication.
Dunham denies any wrongdoing, claiming that his financial woes largely were caused by the buyer of the Nashville paper failing to live up to terms of the sales contract.
In addition to Dunham, the other general partners in the Orange County paper are Executive Editor James Smith, a former president of the Washington Star, and Madelon Maupin, one-time national sales manager for the Christian Science Monitor and former publisher of the San Francisco Business Journal. Maupin is president of the Orange County Businessweek Inc.
Smith and Maupin have "substantially more equity" than Dunham, said Smith, who downplayed Dunham's troubles with suppliers of his Nashville paper, saying there "are two sides to every story." Dunham has "run businesses all his life" and "brings a great deal of skill budgeting a small business. He is a creative guy," Smith said. Dunham, a native of Houston, worked as a consultant for proposed business journals in Richmond, Va., and Newport News, Va., and helped start an advertising agency in Denver.
About 20 investors led by Jack E. McDowell, a former mayor of Laguna Beach, are limited partners in the Orange County venture, which Smith said will require about $1 million in start-up funds. Smith declined to discuss specifics of the financing but said the paper's financial backing is secure.
McDowell could not be reached for comment, and Smith declined to identify the other investors. He said the limited partners will have no editorial voice in the paper.
The paper will enter a publishing field crowded with six daily newspapers and at least a dozen monthly publications. But its owners say they are confident of achieving a paid circulation of between 12,000 and 15,000 at the end of their first year and of eventually reaching a paid circulation of 50,000 or more.
"There is a vacuum here. There is no serious business journal or high-powered business magazine," Maupin said.
"That's a lot of baloney," said Paul Marengo, co-publisher of the Orange County Business Journal, a tabloid published biweekly.
But while Marengo's paper lists only one staff writer, along with an editor and an executive editor whose bylines also appear on articles, Orange County Businessweek executives say they intend to have at least eight full-time writers.
So far, the new publication's editorial staff includes two longtime Orange County journalists--Editor Chuck Loos, 52, a former managing editor of the Orange Coast Daily Pilot, and Associate Editor Sherry Angel, a former magazine editor and free-lance writer.
Three reporters already have been hired, including a former business journal writer from Boston and a health and medical technology writer who recently graduated from Stanford University with a degree in biology. Nine advertising salespeople also have been hired and at least two more, plus about five more reporters, will be aded to the staff, said Stuart Henigson, who is coordinating staffing at the paper.
Explored Other Options
Before deciding to start their own paper, Smith, Maupin and Dunham explored buying or obtaining publishing agreements with two existing Orange County business publications.
"They offered to buy the Orange County Business Journal at a ridiculous price," Marengo said. He said Dunham, Maupin and Smith "don't know the (Orange County) market" and predicted that they will have a difficult time getting a paid circulation.
None of the existing business publications in Orange County are paid-circulation, although the Business Journal and several others are attempting to convert to paid status.
Publishers of many of the existing business publications question whether the county will support a new weekly business paper--and whether the paper can gather enough advertising to survive.
"It takes a long time to establish advertisers," said Bill Lobdell, president of the Orange County Media Group, which publishes four business publications and was the second company Smith, Maupin and Dunham looked at before deciding to launch an entirely new newspaper.