As first reported by Variety last week, Mythical emerged as the leading candidate to buy Smosh, which was left stranded after parent company Defy Media shut down without warning last November.
Terms of the deal were not disclosed. Mythical is paying less than $10 million in cash for Smosh, which was acquired from a holding company representing Defy’s creditors, according to a source familiar with the pact, who requested anonymity because they were not authorized to speak about the deal. Mythical Entertainment has no venture-capital funding and no debt, financing the Smosh acquisition off its own balance sheet.
Smosh was started in 2006 by childhood buddies Ian Hecox and Anthony Padilla (who left Smosh in 2017). Currently, Smosh has over 24 million subscribers on its main channel featuring sketches and parodies of internet and pop culture, along with ancillary channels Smosh Games (7.4 million subscribers) and Smosh Pit (6 million).
“Some of the hardest four months of my life,” Hecox tweeted Friday after the deal with Mythical was announced. “I’m so happy with where we ended up. Very proud of my Smosh Family. So much more to come!”
The deal unites two of YouTube’s most popular and longest-running comedy teams. Rhett McLaughlin and Link Neal are the creators and hosts of weekday “Good Mythical Morning” — currently in its 15th season — which has 15 million subscribers.
Nearly all Smosh cast members, writers, producers, editors, and other staffers have returned to the company with the Mythical acquisition. Smosh is now co-located at Mythical’s offices in Los Angeles. The total staff of Mythical Entertainment is around 70 (40 employees at Mythical and 30 at Smosh).
“Welcome to Mythical, @smosh @SmoshIan and the rest of the squad!” Neal tweeted. “Keep doing your thing!”
In a video posted Friday titled “the rumors are true,” Hecox together with other Smosh members shared the Rhett & Link news. “They are creators helping creators,” Hecox said about Rhett & Link. “It really is an awesome thing. We get to do whatever we want, and we’re super, super excited… We’re starting all over, guys.”
Hecox also announced SmoshCast, a new weekly podcast, with the first episode dealing with the fallout and aftermath of Defy’s shutdown. In addition, the Smoshers invited fans to support them by buying a limited-edition T-shirt that says “I helped” (for $24.99) at its new online store. Down the road, Mythical plans to launch new Smosh projects in touring, publishing, games, TV and film, and other consumer products.
UTA reps Mythical, McLaughlin and Neal as well as Smosh’s Hecox. Mythical Entertainment and Smosh are also both represented by law firm Hansen Jacobon. Mythical was advised on the transaction by Greg Akselrud of Stubbs Alderton & Markiles and Ron Bender of Levene, Neale, Bender, Yoo & Brill, while Smosh was advised by David Sievers, a former senior exec at Maker Studios.
Mythical Entertainment’s flagship property is “Good Mythical Morning.” YouTube funded an expanded version of the show styled on late-night TV shows that launched in the fall of 2017, but “GMM” reverted to its original, shorter format last year. Mythical also recently launched the Mythical Society, a subscription membership program in partnership with Patreon, which offers Rhett & Link fans access to exclusive content, merchandise and other perks.
Meanwhile, Hearst Magazines announced last week that it was buying Clevver, another orphaned Defy Media property, focused on lifestyle and entertainment. Hearst is in the process of determining which Clevver hosts it may continue to work with.