Vice raises $500 mn from A+E, Technology Crossover Ventures
05 September 2014
Brooklyn-based digital news media, Vice, which boasts a solid following among 18- to 34-year-olds, has secured $500 million in funding at a valuation of $2.5 billion, reports in The New York Times and TechCrunch said.
With the funding, would enable Vice to invest in new technology and beef up its coverage capabilities in news, including in video, around the world.
At $2.5 billion, Vice enjoys a valuation higher than The New York Times, and many other established media organisations.
According to the reports, the funds included $250 million each from Technology Crossover Ventures, a Silicon Valley investment firm, and the television network A&E, with each getting a 10 per cent stake.
While the company is not widely known to people in mainstream media, analysts who follow digital sector are not surprised at the development.
According to Rebecca Lieb, an analyst following digital media for Altimeter Group, Vice had done one of the hardest things in the media business today - reaching the young demographic, the non-newspaper readers.
She added, importantly Vice had been able to gain a following among young men, who were noticeably absent on mainstream media.
Following its founding as a subversive magazine in Montreal 20 years ago, Vice had diversified with its grown, drawing most of its revenue from online video, Bloomberg reported. The company had allied itself with prominent companies in entertainment and technology that could help it reach new audiences.
"These new partnerships position us at the forefront of the coming convergence of media and technology, while preserving and protecting our independence," chief executive officer Shane Smith said in a statement. "High-quality content and innovative tech platforms will drive Vice through this next period of growth."
The company has operations across news, food and music, through channels as also a YouTube channel that counts over 800,000 subscribers. Last month the company won an Emmy for its news magazine on Time Warner's HBO.
In association with Technology Crossover, an investor in Facebook and Netflix, Vice would develop technology products for users watching its online programmes on social media and mobile devices.
"A+E Networks continually seeks to create new and exciting content that will attract audiences today, tomorrow and beyond," said A+E Networks CEO Nancy Dubuc in a statement. By investing in Vice, we are thrilled about our potential to further deliver content that meets the demands of the latest consumption trends.''
Vice has won plaudits for controversial stories including a recent series on the Islamic State in the Middle East and a piece on North Korea for HBO.