Los Angeles Business Journal

Purchase of Network a Boost for Platform

By Tom Dotan Monday, May 27, 2013

As for future deals, Wible thinks a distributor like Comcast Corp. would be a more likely acquirer among big media players.

That prediction already has already played out to some extent. Last year, Time Warner Inc. led a $36 million round in Culver City’s Maker Studios while German media conglomerate Bertelsmann SE & Co. recently doubled-down on its investment in fashion-focused YouTube network StyleHaul Inc.

Build or buy

Despite being contained within a $1.8 billion corporation, Awesomeness execs said they don’t expect to be suddenly flush with cash for productions. Rather, it’s about an exchange of ideas, audiences and intellectual property (not to mention a healthy return for investors).

“We have so much more to play with in the DreamWorks tool box,” said Margaret Laney, chief marketing officer at Awesomeness. “They have all these massive digital properties and we have so much to learn from them.”

For a studio, buying a successful YouTube channel might also have been the fastest way to establish a presence online.

Ynon Kreiz, who was recently named president of Maker, said deals like the one for Awesomeness might become more common as the online video space matures and becomes more crowded.

“I think it will be harder for other media companies to do it themselves, and they’ll have to join in the form of partnership,” said Kreiz, who came to Maker after working as an executive at reality TV production house Endemol USA. “Don’t forget, this is a different trade; you can’t just hire a couple of people with that knowledge and marketing and expect to hit it big.”

But being bought isn’t the strategy for every YouTube network – at least not as quickly. Robbins joked that even his investors thought the sale of Awesomeness to DreamWorks “was a little fast.”

Mark Suster of Century City’s GRP Partners, which invested in Maker, said his vision for the company extends beyond an exit. Though he applauded the Awesomeness transaction both for its terms and the message it sends, his ambitions have a different aim.

“At Maker we’re thinking long,” Suster said. “We and some of the other (YouTube) networks think we have the opportunity to IPO and lead the next generation of media studios.”

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