Agora's marketing tactics bring success, accusations

Baltimore publishing company Agora Inc. isn't in the business of subtlety.

The 25-year-old firm markets its 50 financial, travel and health newsletters with bombastic pitches that promise subscribers advice that will lead to riches and better living, or your money back. Guaranteed.


It's a hard sell designed to grab attention in a market crowded with big-name market gurus and forecasters, and it works. Agora's success has paid for founder and President William Bonner's chateau in France, and placed him and a few partners among the top five newsletter publishers in the United States.

"I would say what makes [Bonner] tick is creating and publishing ideas," said Myles Norin, chief executive of Agora's U.S. operations, which account for 60 percent to 70 percent of its sales. "It's not just chasing profits."


But the Securities and Exchange Commission says the company's aggressive tactics have pushed the legal envelope. In a complaint filed last week in U.S. District Court in Baltimore, the federal agency claims that Agora defrauded its readers last year by charging $1,000 for false insider information about USEC Inc., a Maryland company that supplies nuclear power plants with enriched uranium.

USEC said it never gave Agora editor Frank Porter Stansberry inside information and is cooperating with the SEC.

The allegation is part of a pattern of behavior at Agora that the SEC says goes too far. It is asking the court to order the company to stop making false statements in its newsletters and return profits of more than $1 million, among other things.

"We feel there is a need for the court to issue an injunction because we believe there is a likelihood they will do this again," said Ken Israel, an SEC attorney familiar with the case.

Agora denies the charges, saying the case is retaliation for a lawsuit the company filed against the SEC last year. Agora attorney Matthew J. Turner also says the complaint contains factual errors and won't hold up in court.

"We always give a 100 percent refund anytime for any of our products," he said. "It's disconcerting when the SEC is pushing for disgorgement [of profits] when we already voluntarily [do that]."

Headquartered in a historic Mount Vernon mansion, Agora is described by people familiar with the company as an entrepreneurial success story. The privately held company won't disclose numbers, but hundreds of thousands of people subscribe to its newsletters and annual sales could easily exceed $75 million, judging by industry estimates and Bonner's past interviews with media. The company says its sales have increased an average of 20 percent annually during the past 10 years.

Agora is best known locally for renovating a handful of rowhouse mansions in the Mount Vernon area, creating a business campus filled with original oil paintings, polished woodwork and leaded glass windows. The company contributes generously to community clubs, helping to revitalize the city's once-beleaguered Mid-Town Belvedere area.


'They're always there'

"They encourage their people to get involved," said Lisa Keir, executive director of the Mount Vernon Cultural District. "They're always there with a 'yes' when you need something for Mount Vernon."

Bonner's career has been anything but traditional. The Annapolis native studied at the University of Maryland and the Sorbonne before flirting with a career in law. Looking for a job after college in the late 1970s, he linked up with a childhood friend, James Davidson, to form the National Taxpayers Union in Washington. It was during that time that Bonner discovered his knack for direct marketing.

"I discovered the world of direct-response advertising," Bonner told The Sun in a 1994 interview about his growing business. "That you could ask people for money in the mail and they'd send you some."

After several failed ventures, Bonner found success in 1979 with International Living, a newsletter filled with advice about overseas travel and real estate investing. Among other things, the newsletter achieved notoriety by ranking the best places in the world to live. Bonner marketed through direct mail and produced the newsletter with his wife, Elizabeth.

A few years later, Bonner, Davidson and Davidson's former college roommate, Mark Hulbert, started The Hulbert Financial Digest. That newsletter, which Agora has since sold, was sought for its ratings of other financial newsletters. That led to a major foray into investment newsletters, which make up a significant portion of Agora's portfolio today. Subscribers to the company's newsletters pay $39 to $99 for a subscription.


The company also owns the titles to more than 20 books, sells travel tours and investing seminars and owns about 3,000 acres in Nicaragua that it markets to members in one of its many franchises.

In 1994, it went on a buying spree that included the purchase of Pickering & Chatto, an English publisher of academic titles. Bonner, who wasn't available for an interview, spends most of his time in France, but remains in regular contact with the Baltimore operations, which have about 175 employees.

Agora, which employs about 300 worldwide, doesn't downplay its aggressive marketing tactics or its contrarian views on investing, health care or other topics covered in its newsletters.

'Outside the fold'

Its target market is an audience that doesn't want to be spoon-fed advice by brokers or the traditional financial press. Its editors tend to be former financial advisers or brokers who got fed up with Wall Street and wanted to give unfettered advice, company officials said.

"[Our subscribers] don't want to just get their information from the mainstream press," said Norin, the Baltimore chief executive. "They want ideas that came from outside the fold, and that's what they get."


The company markets through direct mail and e-mail, which by its nature requires an edge in order to persuade people to keep reading instead of tossing it into the trash. The investment report targeted by the SEC was marketed through an e-mail with a heading that read: "DOUBLE YOUR MONEY ON MAY 22ND ON THIS SUPER INSIDER TIP." The SEC alleges that the report was filled with "baseless speculation" and "lies."

But the company says it backs up its statements with facts and a proven track record. When put into context, its marketing statements aren't sensational, Norin said.

How the boss sees it

"The sensationalism, if there is any in our marketing, should be backed up by actual events," Norin said. "When we quote our subscribers as saying, 'This was the best thing I ever did in my life by getting hooked up with this publication,' that's real. There's a name behind it, there's a file in our records."

Giving advice that runs contrary to popular opinion is part of the company's niche.

"Part of our philosophy is almost to say, 'au contraire,'" Norin said. "What's another way of viewing this?"


"To me, that's what stands out about Agora," said Walter Pearce, publisher for KCI Communications, an investment newsletter publisher in McLean, Va. "They really specialize in marketing. As [Bonner] says, they're often wrong about their investment forecasts, but they're just really giving a voice to opinions outside of the mainstream."

Pearce said Agora has a reputation for being a little further outside the mainstream than most. But he says sensational marketing pitches are just part of getting a reader's attention so that he reads on.

"Firms like Agora get a bad rap," he said. "If you're The Wall Street Journal, you're a big dog. Big dogs don't have to bark to get noticed. Little firms, to get noticed, have to do some barking."