Big Media Will Pay for Online Video Start-ups with "Vertical" Audiences

http://www.beet.tv/2008/11/big-media-will.html


With the IPO window effectively shut, the most viable exist scenario for venture-backed online video companies is a sale to an established media concern. So what do acquirers want? According to CNN.com general manager K.C. Estenson, while CNN has a huge audience, it needs verticals--audiences within particular categories. He made his comments at the Beet.TV Online Video Roundtable in New York late last month.

Charlie Tillinghast, president and publisher of msnbc.com, said that for companies to be attractive, they have to have a proven revenue model. He says cash position, proprietary technology and a unique editorial focus also add value.

In the current financial climate, Charlie says that acquisitions by companies with cash will accelerate for start-ups willing to settle for lower valuations than they were expecting. (No news here.)

Based on this shocking report on the state of venture capital in VentureBeat by Matt Marshall, the pressure on start-ups to exit is sure to intensify now.

Charlie and K.C. were questioned by co-moderators Erick Schonfeld of TechCrunch and CNET News.com's Dan Farber.

-- Andy Plesser, Executive Producer