Monetizing Media (April 28) – Zwift & Northzone interviews, Research Update, Interesting Deals this Week

Happy Sunday night, media friends. (I’ll send Monetizing Media when I send it. Aiming for shorter posts that vary a bit in format since a formal weekly routine didn’t happen.)

Great to see many of you over drinks in London and LA recently. Shout out to Hummingbird VC and Sinai VC for co-hosting those events. I’ll be at the Milken Conference this week so if you’re in town for it reach out.

Fun fact: tonight’s Game of Thrones episode featured what is likely the longest non-stop battle sequence ever on film, almost the entire 80 minutes. It took 55 days to shoot. The prior (unofficial) record was the 40-minute Battle of Helm’s Deep in “Lords of the Rings: The Two Towers”. (Read more)


Zwift: interactive fitness vs. fitness-gaming

I interviewed Zwift CEO/Founder Eric Min in TechCrunch, discussing the virtual cycling company’s product evolution, numerous potential revenue streams, and Olympic esports ambitions.

Interactive fitness startups are a hot trend right now, following Peloton’s mainstream breakthrough. As it’s preparing to IPO, other “Peloton for X” startups like Tonal, Mirror, and Hydrow are raising substantial sums. Scooter Braun and Rumble are teaming up for a boxing one called At Home 360.

These combine the upfront purchase of workout hardware with monthly subscriptions to access live-streamed or recorded workout videos. It’s a smart business because it taps into “content as a utility”…content that is framed as a providing concrete outcomes in areas where we are used to spending a lot of money (health, education). The hardware purchase creates a sunk cost bias that makes customers resistant to stop subscribing.

What Zwift is doing taps into what I consider a bigger, more defensible opportunity however: fitness-gaming. Cyclists can put their bike on a trainer at home (which makes it stay in place) and ride with other players inside a virtual course where their characters’ looks, movements, and power corresponds to their own.

Because users are represented as players within a social game, there is the benefit of network effects, opportunity for in-game commerce and an audience viewing the competition.

In Zwift’s case, it’s developing a full-force virtual cycling league that involved real like pro cyclists and that he aims to get included in the Olympics as a cycling event. (Read the interview here)


PJ Pärson: VC investing in media

I posted the conversation I had with Northzone VC partner Pär-Jörgen “PJ” Pärsonat the SLUSH conference in Helsinki this past winter. PJ was the first investor in Spotify and also led the Series C round of sports OTT startup fuboTV. Here are a few snippets…

On the framework that’s guided his investing for 20 years:“There’s always value chain disruption potential in pretty much any industry. The trick is to know what role to play in that value chain. Do you want to take a role in many places along that value chain, or do you want to be a tollgate that everyone in the value chain passes through?”

On content exclusivity:
“I do believe that the content market, and the idea of exclusivity, is flawed in many ways…what the artists or the content owners really need is maximum distribution…what is ultimately fueling the interest of Man United or the Patriots is the number of people who want to watch their games. If you restrict that, then you’re undermining the company.”

On tensions between tech and media giants:
“My hopes were too high that the established media houses would see the dangers of jumping into bed with Facebook and Google…they’re just laying down flat to die.”

Research Updates

Unity Technologies: This past week, I wrapped up two months of interviews with (20+) Unity executives for my upcoming TechCrunch series analyzing the $3 billion company (and the future of game engines) as it heads toward a rumored IPO. My articles, podcast episode, and video clips will be published over the course of May.

Music: Next up after the Unity release will be a similar series on a leading music company. I will also be dissecting the results of an ongoing project tracking the newsletter, website, and merchandise strategies of the top 50+ recording artists. 
Patreon: if you missed my report on Patreon (or were scared by its length), I did a 25-minute podcast with Connie Loizos of StrictlyVC discussing the takeaways. (Listen here)

Interesting Deals & Updates


  • Disney hauled $1.2 billion in the opening weekend box office total for Avengers: Endgame, an all-time record opening for a film. It’s roughly twice the prior record of $641 million that was set by Avengers: Infinity War. US moviegoers contributed just $350 million of this weekend’s haul, highlighting the Marvel franchise’s global appeal. (Read more)
  • Sinemia, the Moviepass competitor, announced it is shutting down in the US and then filed for bankruptcy. (Read more)
    • As I wrote in July, cinema subscription startups are doomed to fail in the US and Canada given the market is an oligopoly (or near-monopoly in Canada) and there is substantial advantage to a vertically-integrated solution offered by the cinema chains themselves.
  • Coursera, the online video courses platform, raised a $103 million Series E round valuing it over $1 billion. (Read more)
  • The Writers Guild of America‘s standoff with major talent agencies led to a WGA request for all screenwriters to fire their agents, which at least 7,000 have done. The WGA is encouraging submissions to its own makeshift marketplace for scripts as a way to bypass agents. (Read more)
    • The sticking point in negotiations is over agencies getting packaging fees from studios.
    • This sudden hole in the market is an opportunity for The Black List, a startup that started with a closely-watched annual list of the best unproduced scripts and has evolved in to a marketplace for producers to discover writers/scripts.


  • DouYu, the Chinese game live-streaming platform that doubled revenue in 2018 to $531M, filed to IPO on the NYSE, aiming to raise up to $500M. (Read more | here’s the S-1)
    • Tencent is its largest shareholder and the second largest shareholder in Its main competitor Huya, which listed on the NYSE last year (and had 2018 revenue of $678M).
    • Q4 MAUs: 153M @ Douyu; 116M @ Huya.
    • Both make almost all their revenue from in-app transactions: gifts consumers send to live-streamers.
    • Here’s a helpful post on these companies and the Chinese esports market: Read it here.
  • Playstation‘s $20/month cloud gaming service Playstation Now has reached 700,000 subscribers worldwide. It launched in 2014 and provides access to over 750 games.(Read more)
    • Playstation also said its next generation console won’t be released within the next year. (Read more)


  • Gaana, the Indian music streaming service, surpassed 100M MAUs, up 25% from 4 months ago. (Read more)
  • Amazon, which launched a free tier of Amazon Music (via Alexa) two weeks ago, is reportedly working on a high-fidelity music streaming tier in the $15/month price range. (Read more)
    • Neither Spotify nor Apple Music have made a push into HiFi, leaving it to smaller players like TIDAL.


  • Luminary publicly launched its subscription podcasting app after raising $100M in funding. It’s gotten a lot of flack on Twitter and in the press, however, framing it as having used podcasts without the creators’ permission. The result is a wave of top podcasters pulling their shows. (Read more)
    • What happened is Luminary was using a proxy server, which interferes with podcasters’ analytics by masking the end-user’s IP (it has now stopped). Luminary also automatically strips links from podcast descriptions. It wasn’t stealing and reusing podcasts without permission anymore than every single other podcast app pulling from open RSS feeds does though. 
    • Some of the notable critics of Luminary’s launch, like Ben Thompson, have given Luminary access again.
    • A lot of folks were rooting for Luminary to fail before they even launched. That’s a factor in why this blew up into a big press story and why some top players are using it as an excuse to pull their content.
    • On one hand, there’s a lot of angst in the industry over the idea of paywalled podcasts in general; on the other, there’s lots of competition bidding for exclusive shows who would appreciate one less major competitor.


  • Synthesia, a London-based AI startup that enables automated creation of videos where lip movements are synced with new words/languages, raised $3.1M from LDV Capital, Mark Cuban, and others. (Read more)
    • The product was used in a video that shows David Beckham speaking 9 languages.
  • Voiceflow, a Toronto startup whose platform enables development of Alexa and Google Assistant apps without coding, raised a $3M seed round led by True Ventures and several angels. (Read more)
  • Magic Leap raised another $280M, this time from Japanese telecom Docomo.
    • That’s 2.6B in funding. As Lucas Matney notes, it only just launched its first AR headset, which is expensive and underwhelming relative to the hype behind the company. (Read more)
    • Magic Leap’s market timing was too early. Perhaps it can keep raising enough money on the vision to stay alive as the industry’s R&D makes more progress.


  • Nikkei, the Japanese media conglomerate that owns the Financial Times, acquired a majority stake in Singapore financial news startup Deal Street Asia at a $5-10M valuation. (Read more)
    • FYI Deal Street Asia has a good daily newsletter listing VC deals in China and SE Asia, often at least 1 of which is media related. (Find it here)
  • Verizon Media Group CEO Guru Gowrappan told Fortune his goal is that in 5 years, his portfolio’s revenue will be equally split between ads, subscription, and transactions (like e-commerce and affiliate links). (Read more)
  • TheSkimm acquired the startup Purple, which enables indie creators and media companies to run subscription messaging services through Facebook Messenger (think a subscription newsletter but in FB instead of email). (Read more)
    • Messenger-based communications (that feels personalized) is now fairly common in the music industry as a channel for artists to engage fans en mass. It’s still new in publishing, where TheSkimm has tested it out over SMS.
  • Authentic Brands Group (which owns retail fashion brands Nautica, Juicy Couture, and Nine West) is reportedly the top contender to acquire Sports Illustrated from Meredith Corp at a price of roughly $110M. (Read more)
  • “If free nations demand companies store data locally, it legitimizes that practice for authoritarian nations, which can then steal that data for their own nefarious purposes, according to Facebook  CEO Mark Zuckerberg.” (Read more)

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