Literally Media CEO on "distressed" M&A
Literally Media's doors are open to acquiring "distressed" assets and partnering with individual content creators, CEO Oren Katzeff tells Axios.
Why it matters: A willingness for M&A comes as once high-flying digital media companies have struggled to generate revenue and maintain scale amid an increasingly fragmented industry.
Catch up quick: Owned by Israel-based private equity firm 44 Ventures, Literally Media's portfolio of brands includes Cracked, eBaum's World, Know Your Meme, Cheezburger, Meme Insider and MEL — the last of which it acquired in December from Recurrent Ventures.
- Katzeff joined as CEO in March 2022 after initially consulting for it. His experience includes head of programming at Tastemade and president of Condé Nast Entertainment. He also previously worked at Demand Media when it owned Cracked.
Details: Speaking from Literally Media's office in Greenpoint, Brooklyn, Katzeff says he is interested in "distressed, close to distressed or circling the orbit of distressed" media brands but approaches these deals cautiously.
- "Decline, I think, two years ago or three years ago, means something very different than decline today," he says. "There's probably never been more uncertainty with everyone's relationships with the Facebooks and the Googles and everyone out there."
- A strong acquisition would be a company with high brand affinity and direct relationships with consumers, Katzeff says, and it could be a single YouTube channel, Instagram account, podcast or newsletter.
- "There's a lot of really talented people out there who are giving it a go either on their own or in a very small operation that may benefit from a strategic partner," he says.
By the numbers: Katzeff's goal is to diversify Literally Media's revenue beyond on-site programmatic ads, which make up over 60%. It used to account for 90% to 95% of revenue.
- Video makes up about 15%. Other revenue sources include syndication, Know Your Meme Insights, events and commerce.
- The company is profitable and has 50 employees.
What's next: Literally Media is preparing to relaunch MEL, which Recurrent Ventures folded in July 2022, in the spring.
- Katzeff says his team is "taking some time" to rebuild it. They plan to maintain MEL's dedication to written investigation and expand by creating related videos and pitching streamers like Netflix.
- The company is also growing its events business, namely ticketed comedy shows, and launching a FAST channel later this year.