Paid Content is reporting that News Corp./NBC’s joint venture, dubbed NewSite is seeking to raise funds from private equity firms. The goal, Staci Kramer writes, is to sell 10% for $100M for a valuation of $1B.
If YouTube went for $1.65B and is the main M&A comparable.
What about Joost? Joost just raised $45M from 2 VCs, CBS and Viacom. But at what valuation?
That’s a great question, the two founders of Joost carry a lot of street cred, and they have used their own funds to ramp up the valuation. While Joost is a much-hyped project, a quick peak at the interface suggests that there might just be some substance beneath the flash, for sure. Disclaimer: WatchMojo.com is one of the content providers on Joost, one of the few online-only ones, in fact.
Anyway, much like Google gave 10% to Kleiner Perkins and Sequoia each for $25M total ($12.5M each), I do not see either Sequoia or Index Ventures taking less than 10%. I also don’t see CBS or Viacom taking anywhere near that. So say in all Joost gave up 25% (10+10+2.5+2.5) for $45M, for a pre-money valuation of $135M or post money valuation of $180M. Could that be? Maybe it was actually a pre-money valuation of $180M and a post money valuation of $225M, meaning that the $45M actually got the new investors 20% in all.
Who knows. I could be way off, but if that is somewhat right, what then would New Site’s valuation be?
Paid Content says 10% for $100M, for a valuation of $1B. Hmm. Maybe:
Keep in mind that Joost’s funding for $45 million is for a distribution service with a number of content deals but relying on a viral audience. NewCo says its distribution deals lock in access to 96-98 percent of U.S. internet users; it has its own content and non-equity, non-exclusive content deals so far with Comcast and CNET Networks.
Yeah, crazy times. But then at that valuation, who knows, maybe Joost actually got a far, far greater valuation and my assumption that each VC would demand at least 10% is way, way off. Come to think of it, no way would the Joost guys - who got $4B from eBay for Skype - value their baby so little.
Any thoughts?
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