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What: Verizon Hearst Media Partners and Hearst have entered into an agreement to jointly acquire Complex (the “Company”) in a 50/50 ownership structure.
Why it matters: The deal follows Verizon and Hearst’s agreement in March to form Verizon Hearst Media Partners to develop new digital video channels as well as recent investments in AwesomenessTV.

J_kELH0x_400x400Verizon Hearst Media Partners, a joint venture between Verizon Communications and media conglomerate Hearst have entered into an agreement to jointly acquire Complex (the “Company”) in a 50/50 ownership structure. Rich Antoniello, Complex CEO & Co-Founder, will continue to lead the Company.

The Complex announcement comes on the heels of Verizon and Hearst’s recent investments in AwesomenessTV (each owns 24.5% with DreamWorks Animation owning the rest) and their agreement in March to form a 50/50 joint venture to build new multiplatform digital video channels targeting the mobile millennial audience.

The venture, Verizon Hearst Media Partners, is debuting two initial channels: RatedRed.com for millennials from the heartland who crave a brand of their own, and Seriously.TV, for viewers who want digital video comedic news updates throughout the day instead of waiting for late-night programming for their take on world events.In addition to the joint acquisition, Complex will develop premium video content for distribution across Verizon digital platforms, including go90, AOL.com and more.

Complex will develop premium video content for distribution across Verizon digital platforms

Founded by entrepreneur and Chief Brand Officer Marc Ecko in 2002, Complex is one of the fastest growing networks of sites focused on American popular culture—from entertainment news, sneakers and hip hop music to food, fashion, sports and technology––geared at the millennial male. The Company has seen a profit since 2010, excelling at providing advertisers with this targeted and attractive demographic.

“The decision to acquire Complex is certainly a continuation of our media strategy, which is focused on disruption that is occurring in digital media and content distribution, and involves building a portfolio of the emerging digital brands of the future for the millennial and Gen-Z audience,” said Brian Angiolet, Verizon’s senior vice president of consumer product and marketing. “When we look at Complex and how well they’ve built audiences by championing the digital convergence of cultures for well over a decade, it pairs well with our strategic vision and current shifts in content consumption.”

“Complex will turn up the volume on our growing portfolio with Verizon, complementing the audiences targeted with our other channel investments,” said Neeraj Khemlani, co-president of Hearst Entertainment & Syndication. “

Over the last two years, Complex has adopted a video-first approach, reaching over 50 million unique monthly visitors and seeing consumption spike to 300 million monthly views––a 415% percent growth year over year.In transitioning from print to the video-first digital powerhouse it is today, Complex has become one of the top 10 publishers in the U.S. when it comes to social interaction and engagement on channels like Facebook, YouTube and Twitter.

LionTree Advisors acted as advisor to Complex on this transaction. The transaction is subject to customary closing conditions. The parties currently expect that the transaction will be completed within the next 60 days.

 

 

What: Media and Information company Hearst has invested US$21 million to acquire a minority stake in Complex, one of the fastest growing digital media networks.
Why it matters: Hearst, as other traditional media companiesincluding NBC (e.g. it recent purchase of stakes Vox Media and BuzzFeed)  continues to invest in fast growing digital media and streaming video companies and expand in the digital video arena.

J_kELH0x_400x400Hearst, one of the nation’s largest diversified media and information companies, has announced that it has invested US$21 million to acquire a minority stake in Complex, one of the fastest growing digital media networks.

The joint announcement was made by Hearst Entertainment & Syndication Co-President and Hearst Digital Studios President Neeraj Khemlani, Complex Founder and CEO Rich Antoniello and Complex Founder Marc Ecko.

095dfd2Khemlani (photo) will take a board seat at Complex.

Now reaching over 57 million diverse millennial males monthly across its destination and partner sites, Complex is  is now one of the top 10 publishers in the U.S. when it comes to social interaction and engagement on channels like Facebook, YouTube and Twitter.Complex currently operates a network of sites in addition to its own destination site (Complex.com) that focus on niche cultures and report on trends in pop culture, entertainment, fashion, hip-hop music, art and design, food, technology, sports and video games.

“Hearst continues to invest in fast growing digital media and streaming video companies,” Khemlani said. “The Complex team drives explosive engagement through smart, hip content that features exclusives from some of the top music and popular culture stars of our time.”

“This is an important investment for us and one we view as a crucial strategic play. As we look towards further expansion in digital and linear entertainment, Complex will have access to the extensive expertise, scale and partnerships that only a global media company like Hearst could offer,” Antoniello said. “And with Hearst, we’re poised to become the publisher that influences culture and spurs conversation among an audience that’s as influential as it is broad.”

Since Ecko Unltd. designer and entrepreneur Marc Ecko launched the print publication in 2002, Complex has expanded its business in digital, video, branded activations and emerging platforms. The company has seen a profit since 2010, as it has also excelled in providing a targeted and attractive demographic for advertisers. Over the last two years, Complex has adopted a video-first approach, seeing audience spike to 192 million monthly views, a 415 percent growth year over year. Earlier in 2015, filmmaker Spike Lee joined Complex as Board Advisor, Branded Video Projects to develop formats that could bridge both digital and linear media.

According to Khemlani, the aim behind the deal is the same one that has led Hearst to take stakes in AwesomenessTV and, via its partial ownership in TV programmer A&E, in Vice Media: digital video.

The US$21 million is “predominantly” going into Complex as a direct investment, says CEO Rich Antoniello, though some of the money will go back out to early shareholders via secondary sales. Complex has raised US$52 million to date, including a US$25 million investment from Iconix Brand Group in 2013 that valued the company at $174 million.