The view of the Inner Harbor is spectacular from the Fells Point conference room in the fourth-floor offices of The Baltimore Banner, the news nonprofit that Stewart Bainum Jr. hopes will shift the very foundation of how local journalism is conducted and consumed in this country. But Bainum, the Montgomery County hotel magnate and philanthropist who founded the enterprise and has committed to bankrolling it to the tune of $50 million, isn’t gazing out the window and admiring the gleaming National Aquarium or the iconic Domino Sugars sign in the distance. Rather, he’s looking inward, contemplating a future for his startup, for which there is no blueprint.
Born and raised in Takoma Park, Bainum, 76, resides in Chevy Chase. He is chairman of the board of directors for Rockville-based Choice Hotels International. With more than 7,000 hotels, representing nearly 570,000 rooms in more than 40 countries and territories, it’s one of the biggest hotel franchisors in the world.
“My day job,” jokes Bainum, who also is chairman of Artis Senior Living, an owner-operator of Memory Care Assisted Living residences in 11 states.
Lately his considerable energy and intellect have been focused on Baltimore, where he hopes the Banner, which offers some free content but charges readers a monthly fee to read the meat of it, can become a model for how to revive vanishing local news coverage. Since 2005, the U.S. has lost more than a quarter of its newspapers (2,500) and is on track to lose a third by 2025, according to a Local News Initiative report by the Medill School of Journalism at Northwestern University.
“I have to believe that people in a democracy want to know what the hell is going on in their community. And they need to know, certainly,” Bainum says. “There’s no map for what we’re trying to do. We have to experiment left and right and go down a number of dead ends and turn around and try another route.”
Taking risks is nothing new for the Bainum family. His father rose from humble beginnings to found a successful company focused on hotel franchising and nursing and assisted living facilities. When Stewart Jr. took over as CEO in 1987, he helped increase its revenues from millions of dollars to billions. A former state representative and senator who represented District 20 in Montgomery County, Bainum over time became concerned with the dwindling news coverage in Annapolis and in county council chambers and city board rooms throughout the state. After a failed attempt to obtain The Baltimore Sun, he made a bid to buy the newspaper’s parent company, Tribune Publishing. When that fell short as well, he pivoted and created The Venetoulis Institute for Local Journalism, which oversees the Banner. (It’s named for his late friend, former Baltimore County Executive Ted Venetoulis, who was a passionate advocate for robust local media coverage.)
“I knew nothing about the business,” Bainum says. “I just knew it was dying.”
Bainum sees his mission as trying to save it. If he fails, he’ll be the latest in a line of people whose efforts to recalibrate the industry went bust. If he succeeds, he could help change the course of American journalism.
Considering the stakes, we found Bainum to be affable and relaxed when we spoke with him in mid-June, a week after the Banner officially launched.
Stewart Bainum Jr.
Lives in: Chevy Chase
Education: College: B.A. in history from Pacific Union College; Graduate School: MBA from UCLA; Divinity School: Andrews University from 1971 to 1972
Professional background: Chairman of the board of Choice Hotels International; chairman of Artis Senior Living; founder and chairman of The Baltimore Banner
Family: Wife, Sandy; sons, Brad, 31, and Matt, 28
Why was it important to you to have high-profile offices right in the middle of the city?
It wasn’t important. We wanted a location that was close to the city government and the courthouse, and we wanted to immerse our journalists and our business side right into the heart of the city. We actually looked at almost 20 different location options, and this was the most economic. It looks like the most expensive, but it wasn’t.
Is your plan to coexist with the Sun or to try to defeat it?
We don’t look at it that way. Local news is underreported. We hope to supplement what the other local news sources are doing. The radio, TV, the Sun, the [Baltimore] Brew, Maryland Matters; it’s all one echo system. There are so many stories in Baltimore that aren’t being reported and deserve to be reported, so we’re hoping to help with that.
What is your day-to-day involvement with the Banner?
I’ve spent a lot of time on this for the last two years. Beginning in May of ’20, and it ramped up around December of ’20 when we got involved in trying to buy the Sun and the Tribune Company. My role with the Venetoulis Institute and the Banner is to form a healthy, well-functioning governance structure and then find the right talent, starting with the CEO and the editor-in-chief. I was highly involved with both of those appointments. I see the paperwork on everyone that’s hired. I’ve done other startups, and some have worked and some haven’t, and a lot of it goes to the talent. Who’s on the team? The editor-in-chief search…we looked at 150 people. I spent 16 hours with the two finalists.
I’m not the CEO, but I’m taking it seriously and I’m going to invest a disproportionate amount of my time on the Banner.
When did you first become interested in the changing nature of local journalism?
Ted Venetoulis came to me in June of 2015 and said, ‘I’d like for you to consider investing in this local news startup.’ But I frankly thought that the budget was too small to make it successful.
Over the next five years, local news declined a lot from where it was in ’15. In June of ’20, I reached out to him and said, ‘Give me the lay of the land.’
When I reflected back on my time in the General Assembly between 1979 and 1987, four years in the House, four years in the Senate, we had six robust daily newspapers there. The Evening Sun, the morning Sun, The News American was still kicking, Capital-Gazette was a damn good paper, The Washington Star, The Washington Post. Now there’s only two real papers, the Sun and the Post, and they don’t cover like they used to—by a long shot.
So I thought, Wait a minute. There were a lot of shenanigans going on when I was down there, and that’s when you had six papers. Now you don’t have that, so is the public being treated fairly or not?
Why is it important that there be robust coverage of local and state government?
How can a people govern themselves when they don’t know what the hell is going on in their community? When the stories on one side of town aren’t being shared on the other side of town, there’s a lack of understanding, a lack of empathy, polarization goes up. How do we know the values of the people on the ballot if there’s not local news? How do we know what skeletons they have in their closet? We’re flying blind, and it puts the community at risk.
How did you and your team come up with this idea for the Banner?
It was around the end of March in ’21 when we decided we needed a backup plan in case buying the Sun or Tribune doesn’t work out. That’s when we started developing a business plan for the Banner.
What is that business plan?
It’s a 501(c)(3)—not-for-profit. So there are no shareholders that have to be paid a dividend or are looking for a return. We wanted to make it not-for-profit because we want the support of the community. It would be hard to attract for-profit capital to invest in an industry that’s shrinking so rapidly.
The business model assumes that by 2025, 50% of our revenues will be covered by subscriptions, 25% by advertising, and 12 to 15% by contributions, because we don’t want to be a drain forever on the philanthropic Baltimore community.
How much of your own money have you invested in this effort so far?
I’ve committed to invest or raise $50 million over the next three-and-a-half to four years. We’re going to raise some of that—it won’t all be out of my pocket—but I’m going to see that it’s funded.
Do you find it exciting to be involved in something like this with no road map?
Well, it would be a little more exciting if we had somewhat of a road map. But yeah, startups are exciting. I’ve had some that failed; they’re less exciting than the ones that worked. My [wife] has told me that she’s seen how excited I am about this, and her thought was that I’ve always had a public service itch that the voters in 1986 didn’t let me fully scratch, and this is a way of maybe doing something more than I have.
Your dad started the business that you would eventually run. How did he get his start?
My dad was a plumber for most of my childhood. He was an entrepreneur. It took him 20 years to put $50,000 together to invest in a little 24-room motel. …When my dad started making some money, we moved out to east Silver Spring, to the White Oak area.
How old were you when you started working for your father?
I was 12. He had a plumbing company and this little motel. I was a janitor there for three summers.
Did you always know that after college you were going to join your father in the business?
No. What happened was, my dad wanted me to be a business major. I said OK, I’ll double major in history and business. I go to college, and I had a final exam in accounting and I was so bored. I said to hell with this major. I s—canned that. So he’d given up on me. But then my sophomore year I was elected student body president for the next year at this little college out in California. I worked like 40 hours a week on it, and I loved it. I loved being in charge. Being the boss. When I was applying to graduate schools, the only business school I applied to was UCLA. When I called my dad, he was delighted. He couldn’t believe it. He had given up.
I always loved hearing my dad talk about his business, which he was inclined to do 90% of the time at dinner. I was probably the only one at the table interested. He drove a taxi at night when he was a plumber. He sold vegetables out of the back of his plumbing truck on weekends. He hustled. I admired my dad a lot, and I still do.
You also studied theology?
I was raised as a Seventh-day Adventist. I went to Seventh-day Adventist school from first grade through college. So service to other people was important. The whole [mysticism] of Christianity, I never really identified with. I tried. After business school, I taught college for a year—poor kids, I was 24—and then I went to divinity school for almost a year and a half just to understand what I believed. Not to become a pastor. I learned a lot; it was a good experience, and I’m glad I did it. Then I went and joined my dad’s business.
What did you learn from your dad about the world of business?
To think big. I sometimes still wonder, Do I think big enough? I learned how to negotiate. He was a hell of a negotiator. I had someone…who sent me a note and said, ‘I’ve never come across a better negotiator than your dad.’ And I haven’t either. Also, just how to treat people, and how to go about having high standards and getting people who will fit the culture.
You became chairman and CEO of Manor Care in 1987. What are some of your accomplishments in that role that you’re most proud of?
When I became CEO in ’87, we had about $475 million in revenue, and we grew that over the next 11 years to be about $2.6 billion. We grew it pretty aggressively and created value for our shareholders and our people. We ended up with like 55,000 employees all over the country, and we had the hotel and the health care business. We spun Choice off in the fall of ’96. The family still has [roughly] 38% of the company; it’s a public company.
Choice just announced its purchase of Radisson Hotel Group Americas. Why are you so bullish on the hotel industry as we emerge from COVID?
Our hotel franchising business, the last 50 years, 49 of 50 we’ve had earnings. Forty-eight of the 50 years, the earnings have increased. It’s a good business model we like.
When did you first get the political itch?
Public service, I felt, was the highest calling I could have, given all this emphasis through my religious education. I liked politics because you could do that, and it appealed to my ego—being recognized for doing something good for people who were underserved in the state. I was single for 13 years between two marriages when I was in the legislature, so I worked a lot at both jobs and got a lot of satisfaction out of it.
What did you discover about politics in eight years in Annapolis?
You’ve got to be willing to give and take, and you’ve got to be willing to vote for something that you don’t want to vote for to get something that does more for the public. It’s a trade. I was a babe in the woods. I was 32 at the time. I didn’t understand how things work. I was probably overly idealistic, which meant I was unrealistic. I had to play ball with people with power to get on the right committees and get the votes to get your legislation out of committees. Not just mine, but other good legislation. I wasn’t the best at it, but I enjoyed it. I loved the policy-making end of it.
You mentioned that politics played to your ego. What is the impact on your ego when you lose a high-profile race like you did in 1986 to Connie Morella for a seat in the U.S. House of Representatives?
I had a drink that night. That was a tough one. That was a big disappointment, no question. I didn’t even know if I’d get the nomination, because six other people were running. It was not a high mark in my life.
You’re 76 years old. Do you ever think of retiring?
I just don’t think about it. I need the stimulation. I can’t just go and play golf and tennis and go skiing. I need things to stimulate me intellectually. Business is where I’ve made mistakes and hopefully learned from some. It keeps me interested.
What do you want your legacy to be?
Our goal here is both local and national. Both are ambitious. The local goal is to create a first-rate news outlet that tells the story of the people of Baltimore, strengthens the community, and holds our leaders to account. The national goal is to create a sustainable business model at a scale that can be replicated in communities in all 50 states. That wouldn’t be a bad legacy, because it could really help strengthen the democratic process in this country in a significant way. It’s a grand slam, if we can do it.
Mike Unger is a writer and editor who grew up in Montgomery County and lives in Baltimore. The Bethesda Interview is edited for length and clarity.
This story appears in the September/October 2022 issue of Bethesda Magazine.