VC Tunes into You Tube Channels

By: RH

The Wall Stree Journal did a piece on Venture Capital firms making investments into popular You Tube channels. A lot of the investment is coming more from Los Angeles based firms than Silicon Valley. It makes sense that Hollywood is looking at the content being created by independents to small scale studios. These content creators are another source of creative original programming.

From the article:

In the past two weeks alone, two YouTube channels, AwesomenessTV and Balcony TV, have received funding from venture capital firms including Greycroft Partners, MK Capital, New World Ventures and Polaris Venture Partners. Machinima, the video network with over 3.5 billion YouTube video views, has raised more than $50 million at a valuation around $190 million, AllThingsD reported in May.

“This is the third wave of programming from broadcast to cable to YouTube,” said Mark Terbeek, a partner at MK Capital which led AwesomenessTV’s $3.5 million Series A round. “The cost effectiveness of YouTube is so much cheaper with essentially free distribution.”

Venture capital firms have different reasons for investing in individual media companies launched on YouTube. For example, Terbeek billed Machinima as an “MTV for gamers” and said he invested in AwesomenessTV primarily because of Robbins’s success. But he said the ability to reach a global audience with a critical mass was central to all of the investments in the space.

Read the whole article here