Discovery Invests $100 Million in New Digital Company

NEW YORK: Discovery Communications has made a $100 million investment in a new millennial-focused digital media company that encompasses Thrillist, NowThis Media and The Dodo, plus its Seeker network and production studio SourceFed Studios.

Combined, those assets boast more than 3.5 billion global monthly video views and more than 12 million monthly social impressions. They have over 30 million YouTube subscribers. The properties will reside under Group Nine Media. Axel Springer will maintain its investment as the second-largest shareholder in the venture. Ben Lerer, CEO of Thrillist, has been tapped to lead Group Nine Media as CEO. As part of the minority investment, Discovery will partner with Group Nine Media on 360-degree solutions for advertisers. The investment will be used toward the expansion of the sales team and branded content studio, new vertical launches and content development. In the future, Discovery will have an option to buy a controlling stake in Group Nine Media.

Discovery embarked on its digital strategy for targeting millennials in 2012 when it acquired the digital network Revision3 and later Philip DeFranco’s portfolio of online video channels and ventures, DeFranco Creative. Those were subsequently rebranded as Seeker and SourceFed Studios.

“Today marks the start of a strong new company with tremendous brands, reach and scale,” said David Zaslav, president and CEO of Discovery Communications. “The merger of these assets will bring together best-in-class management, led by Ben and his team, expertise in data analytics technology and global reach to create one of the world’s largest digital-first content companies attracting young passionate enthusiasts that advertisers want to reach.”

Lerer noted, “This is truly a ‘win-win’ scenario, allowing our brands the opportunity to remain independent and build our own future, while at the same time, having the support of one of the best media and entertainment companies in the world. Each of our brands has found great success independently, but with the consolidation of digital content companies around the corner, there is extraordinary value in all existing under one multi-brand roof. We will be stronger brands working together—we will have more influence; we will have better data and insights; we will be better partners to our advertisers; and most importantly, we will be substantial enough to make a real difference and stay ahead of the market.”

“We are big believers in digital journalism and its very exciting business perspectives,” said Jens Müffelmann, president of Axel Springer USA and CEO of Axel Springer Digital Ventures. “We look forward to continuing to strengthen our relationship with the Lerer family through this transaction and to work with Discovery to support the growth of Group Nine Media.”