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Illustration: Sarah Grillo/Axios

Minute Media, a holding group that owns digital sports and entertainment websites like Players' Tribune and The Big Lead, announced Wednesday that it has raised $40 million in venture capital in its latest fundraising round. Sources tell Axios that the company's post-money valuation is more than $500 million. It's raised $160 million to-date.

Why it matters: Minute Media is hoping to expand its business by selling publishing software as a service, not just by monetizing content.

Details: The round is being led by Dawn Capital, an early stage venture capital firm, with participation from existing investors.

  • The money will be used to make continued investments in Players' Tribune, the media upstart launched by Derek Jeter in 2014 and acquired by Minute Media last year, according to Minute Media CEO Asaf Peled.
  • It will also help fund further acquisitions and to globally expand and improve its technology stack.
  • Minute Media has acquired four digital media companies in the last five quarters, mostly in the sports and entertainment space. It currently operates in 40 countries and Peled says the company will continue to look at acquisitions outside of the US.

Between the lines: While many media companies are leaning into technology sales as a new revenue stream, Peled says that software services are a focal point of the company's business.

  • "The reason we can acquire companies and be effective is because we use our tech platform to absorb, integrate and scale each property," says Peled. He hopes to hire more engineers to help power the platform.
  • In the future, Peled hopes to have hundreds of publishers paying to use Minute Media's publishing software. For now, he says the company has dozens of clients, ranging from small digital companies to large newspapers, like USA Today.

Our thought bubble: It's a huge valuation for the company, suggesting that its revenue growth rate is strong.

  • In a statement, Haakon Overli, General Partner at Dawn Capital, said that Minute Media had "explosive revenue growth in 2019," which is why it's continuing to invest in financing further research and development growth at the company, especially around its technology stack.

What's next: For now, Minute Media owns seven digital media publications, including Mental Floss, The Big Lead and the most recently-acquired The Players’ Tribune and FanSided. It hopes to grow this portfolio of brands internationally in sports and entertainment.

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