How SiriusXM bought and bungled a beloved podcast network

SiriusXM leapt into podcasts with a $325 million deal — insiders say it’s off to a messy start

Paul Scheer says the pitch was simple. It was 12 years ago, and the founders of Earwolf wanted him to make a podcast: “We’re gonna make these shows,” he recalls them saying, “and you can do whatever you want.”

His show How Did This Get Made? recorded in a “band rehearsal space in the middle of Hollywood,” and there was no talk of ads. “It was very, very lo-fi,” Scheer says. “The idea of selling ads wasn’t even a thing. There was nobody making big deals in podcasting.”

Hearing people describe the heyday of Earwolf, the comedy podcast network, you can understand how it so quickly developed a roster of talented comics, from the Sklar Brothers and Harris Wittels to Brett Gelman and Jimmy Pardo. Comedians roamed the halls of Earwolf’s office, and everyone seemed to be having a good time making the shows they wanted to make.

“It was never like, ‘Wow, there’s Tom Cruise’ — it was Paul F. Tompkins or people from the LA creative world who were just always fun to bump into,” says Dave Holmes, the host of former Earwolf show Homophilia. “My day was always better for having passed through the Earwolf studios, whether it’s hosting or guesting, whatever.”

A wall of Vans sneakers painted with the faces of Earwolf hosts greeted visitors, suggesting this was a place that not only cared about showing off its podcast roster but also nurturing an audience of fans passionate enough to celebrate them. Early producers, hosts, and editors often came to the company already loving Earwolf shows, and the network became home to a tight community built around a shared passion for podcasting and comedy, former employees tell me.

The company did, of course, have business motivations, too. Early hosts read ads for brands like LegalZoom and Stamps.com, and the team also solicited fan donations and sold merch. Key to how the industry worked back then, though, one former employee says, is that flagship shows, like Comedy Bang! Bang!, could help bring in advertisers to support the small- to medium-sized podcasts that made up the network.

“It wasn’t supposed to be the biggest podcast in the world, and that’s what’s great — or what was great — about Earwolf at the time. They were good at cultivating those medium-sized shows, the shows that had, in comparison to Joe Rogan, a small audience but [an] audience [that] will be committed and consistent and vocal and loyal,” Holmes adds about the network when he joined in 2017. “At the time, that was enough.”

The network, formed in 2010 by Jeff Ullrich and Comedy Bang! Bang! founder Scott Aukerman, represents an original podcast institution, but in the years since its launch, the industry and company have changed alongside each other.

Earwolf is no longer a solo entity. It combined with The Mid Roll in 2014 to form Midroll Media, and E.W. Scripps, a conglomerate of local TV channels, bought them the following year. Scripps then bought Stitcher in 2016, ultimately combining the three assets together under the Stitcher name. Then, in 2020, SiriusXM bought all three brands in a deal worth up to $325 million. The move encapsulates the current podcasting moment: big tech companies spending huge sums in search of audio success. They all do so out of necessity — innovate or die.

Spotify, for example, can’t run a platform wholly dependent on record labels and royalties. It needs podcasts to diversify its revenue. While SiriusXM, a satellite radio subscription business, can’t bank on its customers, particularly the younger generation, wanting to listen to anything other than their phone apps in the car. That’s why it invested $75 million in SoundCloud in 2020 and bought Pandora for around $3.5 billion in 2018, all in a move to capture digital listeners’ attention.

In both SiriusXM’s and Spotify’s case, small podcast networks offered advantages they didn’t already have: expertise in on-demand audio and storytelling, a devout fanbase, and an arsenal of quality programming. For the smaller networks, like Earwolf and its parent, Stitcher, being acquired by a giant had perks, too. It gave them access to deeper pockets that could make them more competitive when trying to retain hit shows or recruit new stars.

But according to 13 former corporate employees across Stitcher who spoke with The Verge anonymously because of nondisclosure agreements and fear of retaliation, the merger was marked by confusion, culture clash, and shifting objectives. Around 145 people worked at Stitcher when it was bought, and since then, more than a quarter of them have left, The Verge found through LinkedIn. This includes the prominent departures of CEO Erik Diehn, CRO Sarah van Mosel, CFO David Murray, and CTO Peter deVroede, among others. Many shows have left the network, too, including Hollywood Handbook, an early and prominent show that is now independent on Patreon, as well as Holmes’ show, Homophilia, which is now on World of Wonder. It’s become so apparent that the network is bleeding talent that its fan subreddit now has multiple threads wondering what happened inside the company and why shows left.

The answer is complicated. Though the brand, particularly Earwolf, was initially a beacon for comedy talent with minimal pressure around numbers or performance, the broader audio industry has been shifting toward a scale where bigger and bigger hits are critical to staying afloat. Combined with the x-factors of a pandemic, a new corporate environment, and growing ways for shows to make it on their own without network support, the moment was right for a talent reckoning.

“You either have to be very small or very big,” says a person familiar with Stitcher’s strategy at the time. “It’s really hard to exist in the middle — and we were choosing to go big.”

Stitcher’s problems started before the SiriusXM acquisition. In the year prior to the purchase, hosts at some of the network’s smaller shows began to feel like they were being overlooked in favor of bigger names, these former employees say.

These concerns came to a head in the month before the SiriusXM acquisition. In June 2020, during the height of the pandemic and prominent Black Lives Matter protests, more than 40 Earwolf hosts and creators sent a letter to management, which was viewed by The Verge, expressing concerns that Stitcher’s ad sales model disadvantaged smaller shows and failed to land them consistent revenue. This presented a problem because hosts receive a minimum guarantee and then make money off an ad share agreement. The sales team, the letter points out, only employed white team members, which multiple employees tell me led to incidents in which hosts of color felt especially under-served.

Yo, Is This Racist?, a show in which co-hosts Andrew Ti and Tawny Newsome answer listeners’ voicemails and determine whether certain experiences are racist, came up multiple times throughout my reporting as a title the Earwolf team loved but that ended up leaving the network over lack of support. Ti tells me he and Newsome were asked to remove “racist” from the show’s title because it made ads harder to sell. He says the sales team told them some advertisers might think the show is “pro-racism.”

“To us, what we heard was that just means you haven’t listened to the content and you’re aren’t making any effort to explain it to advertisers,” he says. A spokesperson for SiriusXM says a name change was never discussed at Stitcher, but the word “racist” was removed from “select sales materials” to prevent the show from being unfairly rejected by marketing filters. The show left the network and is now working with Gumball for ad sales instead.

The letter, signed by prominent hosts like Chris Gethard, Jason Mantzoukas, and Nicole Byer, demands answers for why ad revenue dropped or never thoroughly existed in the first place.

“Your sales team has continually passed the buck to each of us, in order to hide their own ability to properly support our shows,” the letter says. “If this many of us are experiencing the same trend with ads, this is clearly a systemic issue beyond any individual show’s responsibility. We believe the entire Midroll model is only optimized to sell for its top shows, and in addition to that, actively penalizes any medium or smaller shows.”

A person familiar with Stitcher’s finances tells me that direct response advertisers — traditional podcast brands that offer promo codes — stopped spending money during the early pandemic, effectively cratering smaller shows’ revenue and fueling the host uprising.

“There wasn’t something we could do that would just suddenly make the shows make more money, and some of the things they suggested, while well-intentioned, were just impossible,” they say.

Still, the company responded by committing additional revenue guarantees for some affected shows and dedicating “six figures” in marketing dollars to smaller shows, this source says. It also hired a woman of color to a prominent role on the sales team, though she left less than a year later.

It was during this time that SiriusXM finalized its deal to acquire Stitcher.

SiriusXM executives knew they needed to invest in the company’s future, a person familiar with discussions says, but they didn’t have a fully baked podcasting plan. The company only knew that it needed a “shot in the arm in the podcasting division.”

“When you’re having this incredible cash machine that’s built to do one thing really, really well and then you see something on the horizon that suggests that that is going to come to an end, you’re going to have 20 different opinions about the right thing to do,” the person says.

Would podcasting at SiriusXM be an ad sales business or a subscription one? Would the SiriusXM subscription matter most, and should a new business be built around podcasting? What type of talent would be best to sell ads against, anyway? “The approach was, ‘Yeah, let’s do all that,’” they say.

Stitcher employees first heard about the acquisition through the press, setting off a domino effect of bad vibes and mistrust, according to the former employees and hosts. Stitcher management, they say, didn’t comment on the rumors and delayed all-hands meetings to discuss it, only to then host one confirming the sale without much detail. Employees say CEO Diehn told them the deal was indeed happening and that they were all employable, making some worry they might lose their jobs, though SiriusXM tells The Verge it extended offers to bring everyone on once the acquisition closed. When they joined SiriusXM, employees had to adjust to a wholly new company in a pandemic. Everything happened virtually.

“It came in probably the most uncertain time, and piling on more uncertainty about your job — and a job that a lot of people in this industry feel so connected to — creates a lot of psychic tension,” says a former employee.

SiriusXM seemingly bought Stitcher for its ad business or to expand its “pre-eminent position in digital audio advertising,” per the press release announcing the deal’s closing. It also gained subscription revenue from Stitcher Premium, the company’s bonus content offering, which had between 130,000 and 140,000 subscribers at the time of sale, according to a person familiar with the product.

Expectations about the purchase ranged among the employees I spoke to. Some received raises — others didn’t. Some expected investments in their shows to increase, only to be let down and watch their favorite programs leave. Broadly, employees say they felt disempowered and uninspired when having to run decisions up through SiriusXM’s bureaucratic ladder.

“It shifted from an excitement and a ‘Hey, with your scale and our special sauce, we can make this thing really great’ to ‘Oh, you guys are so small you don’t really understand how any of this works, so just quiet down and follow our lead,’” says a former employee.

“I was shocked by how uncurious people were there about how we had succeeded in podcasting or how we did what we did,” another says.

That knowledge gap made Stitcher employees — experts in the podcast industry — feel like they walked into a company that didn’t want or need their help, despite evidence to the contrary. Various employees say they had to educate the SiriusXM team on what made a good podcast. The SiriusXM team mainly suggested adopting various SiriusXM shows, and one employee says they had to explain that an RSS feed being live “didn’t mean that there was anything playing in it right now, like they don’t understand the difference between radio and podcasts.”

A former sales team member says Stitcher never allowed advertisers to pre-approve the actual audio of a host read — only the ad copy they’d receive — but SiriusXM at times made pre-approval part of the process, which they say turned into a communication nightmare. Another person says cross-promoting shows with other networks, a standard podcast marketing move, became difficult because SiriusXM implemented a minimum ad spend, straining relationships with podcasting partners who were used to paying hundreds of dollars for an ad spot, not thousands. Stitcher’s marketing was also used to buying ads on Spotify for promotion but was told to “never spend another dime in Spotify again” once they joined SiriusXM.

“It just got to a point where some days it was so much and like I would just literally sit there and just bang my head against my desk, like this is insane,” says one former employee. A spokesperson for SiriusXM says it is “not our policy” to allow pre-approval of host-read ads and that its marketing team is allowed to purchase ads through Spotify’s Megaphone.

The culture fit wasn’t right, either, these former employees say. Multiple people pointed to a survey SiriusXM’s HR team asked them to complete about how things were going and the town hall held in response. Employees had raised concerns about diversity within the company but were told in response that they couldn’t have diversity issues because the company employed a female CEO.

The company also routinely hated on its competition rather than reflecting on why those products were working. “Spotify is the devil to SiriusXM,” says one former employee. The enemy offered a rallying point for the team, which another former employee called a “boomer business mentality, like a toxic business mindset.” (“This view and that language doesn’t reflect that of SiriusXM,” says a spokesperson for the company.)

“I have been called out in numerous meetings for saying ‘Spotify,’” another former employee says. “I’ll be like, ‘Oh, yeah, I was listening to that in Spotify,’ and a legacy Pandorian will unmute and be like, ‘What is that?’”

At the same time, executives didn’t seem to have a full picture of its podcast competitors. During one all-hands meeting, for example, DJ Khaled joined as a special guest because he apparently loves Pandora — but Khaled also hosts a podcast on Amazon Music. The moment emphasized to at least one person on the Stitcher podcast team that the company didn’t know the space well.

Content strategy remained a point of confusion, too. At one point, SiriusXM decided to go after fiction podcasts, says a former employee, only to tell its team around three months later to stop pursuing that strategy. Months after that, SiriusXM invested in Audio Up, a company designed to make scripted shows — making its internal team look like they didn’t know what they were talking about to external partners. A spokesperson for SiriusXM says work on original fiction podcasts continues inside the company.

“When we came to SiriusXM, we were promised that SiriusXM would let us do what we want,” they say. “In fact, our deals are by far worse now than they were before. By worse, I mean laughable amounts of money.”

In an email to The Verge, SiriusXM’s SVP of communications, Patrick Reilly, characterized the findings of our reporting as being typical of the challenges facing any corporate acquisition, with staff and executive turnover, transitions to the company’s preferred systems and technologies, and meetings to address employees’ concerns.

“While there are always challenges following an acquisition, SiriusXM and Stitcher leadership worked together to make sure the transition went as smoothly as possible,” Reilly says. “Many of the concerns addressed in this story predated the acquisition, and were quickly handled once the company joined SiriusXM.”

Stitcher’s staff has grown by 25 percent since the acquisition closed, Reilly says, and the company continues to “support emerging creators, at Stitcher and throughout SiriusXM.” He cited SiriusXM’s acquisition of 99% Invisible, its exclusivity deal with YMH Studios, and advertising arrangements with popular shows including New Rory & Mal and Last Podcast on the Left.

Those exclusive ad-sales and distribution deals are part of SiriusXM’s podcasting strategy, he says, as was bringing on a team of experts. “One of the reasons we acquired Stitcher is their industry-leading expertise in podcasting,” Reilly says.

Earwolf was already changing in the years before the acquisition. The network had started to prioritize larger shows, like Office Ladies (from The Office stars Jenna Fischer and Angela Kinsey) or Conan O’Brien Needs a Friend, over the small comedy series the network built its name on.

Since the acquisition, employees say that’s accelerated. Multiple smaller shows — including Culture Kings, Off Book: The Improvised Musical, and Spanish Aquí — have left or ended their runs, while Earwolf has continued to focus on big names like Seth Rogen, who launched a podcast last October. SiriusXM tells The Verge that Rogen’s show exceeded 3 million downloads across its nine-episode first season and that a second season is in the works.

“It feels closer to Spotify or something else where they’re hit hunting,” says one host. “It doesn’t really feel like it has an identity as a comedy network that supports artists in the same way,” says another.

Compounded with the messy integration of the two companies, employees at Stitcher started heading for the door. At least one left on the spot with no notice. Another tweeted that they were dismissed after making a TikTok about quitting.

Some employees did stick around and seemingly thrived, some former employees say. One calls SiriusXM’s approach “pure corporate Darwinism,” where the people who could make the corporate system work for them did, and the ones who couldn’t left. Some shows and hosts, like Scheer, say nothing has changed on their end — they still talk to the same person at Earwolf and keep making their show as usual.

SiriusXM is not alone in having these issues. Spotify struggled to integrate and support its own studios as well. Business Insider reported last year on shows from Gimlet Media, which Spotify purchased in 2019, lagging behind Spotify’s other networks; Gimlet also had a very public confrontation with racial disparities in its studio. Then in January, Spotify shut down its homegrown production studio, which sources said at the time had never been given a clear direction.

These acquisitions also arrived at a time of upheaval for the podcasting industry. Creators — particularly those with small, loyal fanbases — now have more options. They can go to Patreon or, like Earwolf founder Aukerman, launch subscription offerings through new partners. (Aukerman worked with Acast to launch Comedy Bang! Bang! World in October last year, which offers ad-free and bonus content.)

Scheer says in 2014, when he launched the now-defunct Earwolf sub-network Wolfpop, he and the team told shows they’d need 40,000 weekly listeners to be successful. “That number has gone up and up and up,” he says, adding that he now believes any show needs over 100,000 listeners per week to make money. This is why smaller shows with dedicated audiences might have better success on Patreon, charging their fans directly.

“It’s an easier way to monetize your listeners,” Scheer says. “Whereas podcasting now you have to compete with all these giant celebrities and all these people out there that are doing these really big, flashy shows.”

Most employees and hosts at Stitcher seem to understand that the podcast industry has shifted and that Earwolf’s early energy likely couldn’t last. Quitting the job today means logging off Zoom forever, not taking one last stroll past the wall of Vans sneakers. Spoken word audio is now a fundamental part of multiple deep-pocketed companies that need podcasts to survive — free laughs won’t pay the bills.