A little over a year after it was founded, Group Nine Media has raised a $40 million follow-on round in new funding from Discovery Communications, German media conglomerate Axel Springer and venture-capital firm Lerer Hippeau Ventures.
The company was formed in October 2016 with a $100 million investment from Discovery, combining three startups backed by Lerer Hippeau Ventures — Thrillist, NowThis Media and the Dodo — with Seeker (formerly Discovery Digital Networks). Axel Springer was previously an investor in NowThis Media and Thrillist.
New York-based Group Nine, headed by CEO Ben Lerer (founder of Thrillist Media), said the new funding will be used to expand video content across its brands as well as for “selected acquisitions.” Earlier this month, Group Nine announced the acquisition of digital-comedy studio Jash, whose founders include Sarah Silverman, Michael Cera, Tim Heidecker, Eric Wareheim and Reggie Watts.
“This vote of confidence from our partners in both our vision and trajectory will allow us to lean in and grow faster and smarter,” Ben Lerer (pictured above) said in announcing the funding.
Group Nine didn’t disclose what its current valuation is with the new funding. The financing comes as other digital-centric media companies are hitting a wall. Mashable reportedly has agreed to sell itself to publisher Ziff Davis for $50 million, about one-fifth of its previous valuation, while BuzzFeed is said to be falling short of its 2017 revenue goal by up to 20%. Other digital players including Defy Media and Uproxx Media are considering exploring sales, per a Bloomberg report.
Group Nine’s roll-up strategy was engineered to give it audience scale. Its properties now reach some 40 million unique visitors daily in the U.S., including 80% of Americans in their 20s, according to Nielsen. The company’s brands in total generate more than 5 billion monthly video views across platforms, according to Group Nine, citing CrowdTangle and platform-specific sources.
David Zaslav, president and CEO of Discovery, said Group Nine has become “an integral part of Discovery’s strategy to nourish audiences across all screens and services.” He added, “The company is completely on track, led by a terrific management team, with superfan brands, strong tech and data and a strategic growth plan.”
Jens Mueffelmann, CEO Axel Springer Digital Ventures, commented, “Group Nine had ambitious plans and is exceeding expectations on every front… It is the right time to lean in on this growth.”