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Vice, the once free indie punk mag from Montreal, Canada is today valued at more than US$2.5-billion.
While everyone’s looking at what the young tech company BuzzFeed is doing right with its massive 40-million monthly users and US$50-million investment, Vice Media is cropping up over 150-million users and just got a fresh injection of US$500-million.
Silicon Valley based Technology Crossover Ventures recently pumped in US$250-million (and is also a big backer of Netflix and Facebook) while the other half of the Vice’s new investment pie comes from the massive US television group A&E Networks.
According to The New York Times, Vice is expected to make US$500-million in revenue this year. How is it making this truck load of green?
While BuzzFeed, is popularly known for zoning in on native advertising, Vice seems to have its feelers on a diverse crop of revenue streams, including native advertising.
According to an article on Fortune, Vice is gearing up to get a lot of its revenue from licensing unique video content, as it did with its News series on HBO which also won an Emmy Award last month. Similar to the HBO deal, Vice seems to be further looking to larger cable companies including A&E, which is owned by Disney and Hearst, for larger TV distribution deals.
“TV has a huge amount of scale and no matter what anybody thinks, people come home and eat their dinner by 6:30 and they’ve still got six hours of TV to watch,”CEO Shane Smith tells Fortune in an interview.
The A&E partnership will see the company increase its ever-expanding reach to a global audience screening edgy channels covering news, sports, food, and culture. Last year Robert Murdoch, the media kingpin behind Fox, invested US$70-million in Vice.
Moreover, and probably less known, is the company’s advertising agency, its record label, and its film division which all do their part in keeping the company diverse, and thus easily adaptable.
Also, it’s not scared of saying the word f*ck. Smith has the unique edge for running a company not shying away from controversy, tattooed journalists and bizarre stories like Snake Island, Underground Bare Knuckle Boxing in the UK, and Inside North Korea. The latter saw the very notorious event of basketball star Dennis Rodman getting buddy buddy with North Korea’s supreme leader, Kim Jung Un.
In short, Vice’s content is not known for being politically correct to say the least.
And with this image comes its very strong demographic, described as being “more influential, affluent & active than millennials as a whole” also known as Gen Y.
Its YouTube channel numbers can give us a good indication of its video reach. Its general channel has over 4-million subscribers while its few-months-old food channel, Munchies, has a 200 000-strong community.
As sources further tell Fortune, a large part of the company’s money also comes from sponsored content. A really good example of this is The Creators Project video series which is sponsored by Intel. Apparently this deal constitutes of millions of dollars.
According to its Media Pack of 2014, these are Vice Media’s channels (some up-and-coming):
Earlier this year, founder Shane Smith boasted about how his “empire” is gearing up to take over world media as we know it, and even said that he’s planning on taking the company IPO for a massive US$30-billion.