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Shane Smith and Suroosh Alvi in their New York office in Brooklyn, N.Y. The two are co-founders of Vice magazine. (Jimmy Jeong for The Globe and Mail/Jimmy Jeong for The Globe and Mail)
Shane Smith and Suroosh Alvi in their New York office in Brooklyn, N.Y. The two are co-founders of Vice magazine. (Jimmy Jeong for The Globe and Mail/Jimmy Jeong for The Globe and Mail)

The Vice guide to making a killing Add to ...

At its start in the mid-1990s, Vice was a sarcasm-drenched Montreal magazine of hard-partying music and fashion. As of this month, it's a global media conglomerate that has attracted a round of partnership deals the Financial Times valued at more than $50-million.

Anyone trying to make sense of how should have been a fly on the wall at one of Vice's early meetings with MTV in the mid-2000s. As former colleague Trace Crutchfield describes it, Vice co-founder Shane Smith sauntered in and started messing with everything on the premises.

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"He's going around looking at pictures, kicking things, like he's looking to buy the place. I'm kind of like, 'Shane, be cool!' I remember thinking at the time, 'My god, what is he doing?'" Mr. Crutchfield says. But he soon realized the method in his Falstaffian friend's mischief. "Later on, I thought, 'Dude is a [expletive]genius. They were all looking at him.' It was a brave move."

Mr. Smith was following Vice's standard MO: Whatever you want, whether it's street cool or media power, come on as though you've already got it. Before long, with MTV's backing, Vice produced a globetrotting gonzo DVD, The Vice Guide To Travel, in a style that has been described as 60 Minutes meets Jackass.

That laid the track for VBS.TV, a popular online video site that runs uncensored documentaries such as the current Rule Britannia: Royal Wedding, featuring characters obsessed with the Windsor nuptials for reasons quite unrelated to Kate Middleton's hairdo: extreme royalists exiled in Malta advocating new anti-Islamic crusades, anarchists planning to celebrate with a pagan fertility rite and pornographers shooting a "high-budget bunga-bunga party with Royal Family look-alikes."

It's a long way from the Bifteck, the bar in the Plateau area of Montreal where Mr. Smith first drunkenly encountered Suroosh Alvi (then a recovering heroin addict) and learned he was creating a magazine with their mutual friend Gavin McInnes.

But the sensibility is consistent: a gung-ho but subversively cynical eye on the point where skateboard, hip-hop, punk, dance and gay culture meet, which served them well as all those cultures became more mainstream and commodified.

By the early 2000s, Vice had become a free glossy mag distributed in the trendiest boutiques across Canada, the U.S. and Britain (including its own Vice clothing stores, now defunct).

It had advertisers such as American Apparel and edgy photos by the likes of Terry Richardson and Ryan McGinley. Its articles played not only with music, politics and fashion (its cruelly foul-mouthed "Do's and Don'ts" column spawned a spinoff book and the styles of countless later blogs), but with shock-value notions of race and sexuality (leading to accusations that it hid conservatism behind an ironic mustache).

Vice became a shibboleth among hipsters from Toronto's Queen Street to Brooklyn's Williamsburg to the Marais in Paris.

By sticking with the attitudes born of their membership in a semi-lost generation wandering the seedier back routes of post-Cold War globalization, they've earned an improbable jackpot: Marketers and media have become increasingly desperate for the ear of the subsequent, more numerous cohort of skeptical, educated hedonists who take for granted the tone Vice helped set.

Punk, Incorporated

As the magazine spread to more than 30 countries, it built a Vice record label, a branding agency that has worked with Smirnoff and Nike, a film wing and projects with larger media players such as CNN and Intel. And this month it struck its new partnerships with media giant WPP, former Viacom and MTV head Tom Freston and the William Morris Endeavor agency.

That means a much wider reach, more money and more responsibility, which raises the question of how Vice can possibly stay irreverent and punk. In many ways, the answer must lie with Mr. Smith and Mr. Alvi themselves (Mr. McInnes left in 2008, though some say his editorial voice and spirit haunts the place like the ghost of Banquo). Much more than Facebook, Rogers or Viacom, Vice is an outgrowth of its founders' personalities.

"I have the greatest life in the world, because I created it," says Mr. Smith, splayed out on a rich leather couch in the woody and carpeted conference room of their Williamsburg offices.

By his colleagues' estimation, Mr. Smith is to the business side of the operation what Mr. McInnes was to the editorial. "As he's always said, Shane can sell rattlesnake boots to a rattlesnake," Mr. Alvi says.

"He's this larger-than-life guy," says Mr. Crutchfield, who worked with the founders for a decade. "He's like P.T. Barnum meets Lord Byron, because he's a sensualist. [Mr. Alvi]was always more mellow. He was the resident hall guy who tried to monitor Shane and Gavin a bit."

The bearish Mr. Smith groomed his DIY style as a teenager on the Ottawa punk scene, graduated early and took political science at Concordia University, but dismisses much of his education, preferring the real lessons in politics he has learned from travelling the world. In Budapest, he stole the books from the Berlitz English course he was teaching and set up his own school, and then used the income to set up a black-market foreign exchange. When he met Mr. Alvi, he was working on a writing portfolio to apply for a master's degree.

Mr. Alvi, often described as "the low-key one" and the father figure at Vice, was reared in the Toronto suburb of Willowdale, the child of immigrant academics from Lahore. "The seventies was not a great time to be Pakistani and in Toronto. It was very racist," he says. "Kids would beat me up at school, I would come home crying and I'd literally be asking Mom, 'Why am I brown?'"

In high school, he followed his mother's job to Minneapolis just in time for that city's musical golden age - "Hüsker Dü, the Replacements, Soul Asylum and at the same time Prince." It was the beginning of an obsession that's paid handsome dividends: Vice Records has sold more than five million albums worldwide.

Mr. Alvi headed to McGill for university. "I was like 16 or 17," recalls former Hole bassist Melissa Auf der Maur, who hung out with his gang in various dives. "There were times when it was sketchy. But I knew that if Suroosh were there, I would be safe. I could trust him."

The lie that launched an empire

Things began to change for the crew around 1999, when they garnered interest from Montreal software tycoon Richard Szalwinski. "We knew we needed someone to help us get out of Montreal; you can't relocate a business across borders when you're on welfare," Mr. Alvi says. He recalls Mr. Smith fabricating a yarn in an interview about what a sought-after property Vice was: "Everyone wants to buy us. Larry Flint's in the mix. News Corp. is in the mix. And Richard Szalwinski, owner of Shift."

Mr. Szalwinski saw it and indeed ended up buying the company. He moved them to New York, unfortunately on the cusp of the tech bubble. "We did a stock swap, so one day they were like, 'Cha-ching, you're worth $40-million,'" Mr. Smith says. "I was wearing Prada clogs - it was just nuts. And then boom, they just disappeared."

After the crash, the founders bought Vice back.

While neither remaining founder will reveal what they are currently worth, it is enough for Mr. Smith, who is married with a young daughter and a baby on the way, to have purchased his "dream apartment," a 3,000-square-foot TriBeCa loft with a Japanese soaking tub and a work by graffiti-artist-turned-painter Richard Colman "that's the size of this room" - though because it depicts a great deal of anal sex, he may have to take it down when the kids get old enough to notice.

Mr. Smith also owns a mountain retreat in Costa Rica, where "I spend a lot of time just sitting with my dogs, drinking rum and looking at the ocean."

Mr. Alvi, who is recently single, lives in the East Village, where he is co-owner of a house with a big backyard, a rarity in New York City. "I'm building a jungle - I need a lot more vegetation. And I'd like to get some sort of animal. I've always imagined how cool it would be to have a giraffe or a zebra back there. I think a giraffe would be a statement."

Turn on the jets

While they luxuriate in the spoils of their triumphs so far, other observers question how long the Vice founders will hold on, what they can do next and whether a conglomerate well into its second decade really has any remaining claim on the cutting edge.

"If anything, Vice sold out years ago, when it began to build up an internal creative agency," Nick Denton, the proprietor of media-gossip-blog central Gawker.com, recently wrote. "Vice is no longer an editorial organization, and hasn't been for a while."

Mr. Smith and Mr. Alvi, on the other hand, would point out that there were similar rumbles when Mr. McInnes left, and in the three years since then, VBS.TV has grown to 4.4 million unique visitors a month. As far as they're concerned, there are few limitations on what they can do - at least for a while.

"It's an exit [strategy]" Mr. Smith says. "When we're pumping out, say, 10 million uniques a month, we go to Google and we say, 'Do you want the next ESPN, CNN and MTV? Guess what? We have them. You turn on the jets and we have the largest digital network in the world.' That's what they're buying into."

Big talk, but that is Mr. Smith's specialty.

And what of Mr. Alvi? "My role, as the company grows, is to maintain the culture that is Vice," he says. "The most important thing is that Shane and my relationship needs to be intact. I consider guys like Shane to be part of my family."

"Shane's a very charismatic leader and he's been able to attract all kinds of talented people that want to come and work for him," says Mr. Freston, the Viacom founder among their new investors. "Now that it's reached a certain size, I think they can attract a lot of cool people from big ad agencies, because they're sort of the hot shop."

If that's a good thing or not, time will tell. Or, more likely, Mr. Alvi and Mr. Smith will: As always, but with ever-higher stakes, the virtues of Vice come down to them, and all the hopes, hustle, ghosts and demons they carry with them.

John Ortved is a writer based in Toronto and New York. He has sometimes contributed to Vice.

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