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The Chernin Group leads $263M Funko deal

Tim Baysinger
May 6, 2022
Illustration of a collage featuring an old TV, parts of dollar bills, and a TV test pattern.
Illustration: Brendan Lynch/Axios

The Chernin Group is leading a group of eBay and media heavyweights including Bob Iger and Rich Paul to invest $263 million in Funko, the Everett, Washington-based merchandiser.

Why it matters: Diversification is key, and merchandising has long been a holy grail for content makers (see Lucas, George).

  • The Chernin Group has already had success marrying games with content with its recent cross-media deal for Netflix's Exploding Kittens game.

Details: The Chernin Group-led consortium will own 25% of Funko.

  • The group is purchasing 80% of Acon Investments' stake in Funko at $21 per share.
  • The Chernin Group's Jesse Jacobs will join Funko's board, while Iger and Peter Chernin will be advisers.
  • eBay will become the preferred secondary marketplace for Funko and will partner on exclusive product releases.
  • Paul, who founded Klutch Sports Group and is head of sports at UTA, will help the company expand into music and sports (his client roster includes Lakers stars LeBron James and Anthony Davis).

The big picture: Jacobs believes Funko can be the next big toy brand to make the transition to the content space.

  • Warner Bros. has built a film franchise around Legos and is trying to do the same with Mattel's Barbie.
  • Jacobs thinks Funko can achieve it: "Pick your studio and say we're going to do a joint TV show or movie where you have a bunch of Funko characters, all from that same studio," he tells Axios. "That seems really interesting and powerful."
  • Jacobs wants to do similar deals like the aforementioned Exploding Kittens/Netflix deal, which includes both a TV show and a new game. "We're definitely looking at that as a way to exploit and develop the IP that we have in our investments," he says.

What's next: Funko seems better suited than most to push into the NFT space.

  • On Thursday, it had its largest NFT drop so far — Jacobs said it was around 320,000 NFTs done in partnership with DC Comics. It sold out in 30 minutes.
  • "I think there's a lot more that we can do. We've talked about that with them beyond just this particular strategy," he says.
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