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Avatar technology company Genies has a "war chest" that will not only help it stay independent but also could fuel acquisitions over the next year, CEO Akash Nigam told Kerry.

Why it matters: As more attention goes to the metaverse, big-tech companies are building their own systems and buying startups — Alphabet recently acquired digital avatar startup Alter. But Genies is betting it could be an acquirer rather than an acquisition.

What he's saying: Web3 is "nascent, and it's booming, but there's not a lot of people," Nigam said during an Axios Pro live event yesterday. "Right now, I think people are playing Hungry Hippo with talent, but they're also playing Hungry Hippo with the actual companies."

"If we sell to a centralized company, how are we going to be able to continue down a decentralized path?" said Nigam.

Details: He said Genies recently hired someone to focus on M&A but declined to share the name since they hadn't started yet. 

"Have we made any acquisitions? No. Do I see us doing anything over the next six months? No. But over the next year, I can see us making one or two," he said.

Catch up quick: Genies launched in 2017. Early efforts included personalized digital avatars reenacting news. Later, Genies built digital avatars for celebrities like Justin Bieber. But the goal is much larger.

"Genies wants to be able to empower humans to be able to create and own their own avatar ecosystems," Nigam said. "We believe avatar ecosystems are going to be the mobile apps of web3."

In April, Genies announced a $150 million Series C at a $1 billion valuation. Former Disney CEO Bob Iger, who Nigam said he speaks with every day, is an investor and board member.

How it works: "I hate it when people call us an NFT company or a web3 company," Nigam said. "We view ourselves as a communications company."

Genies makes money by taking a 5% cut of primary and secondary transactions in its ecosystem, including avatar fashion. 

Based in Venice, California, Genies has about 150 employees.

"Our overhead is actually virtually nothing," Nigam said. "I think Genies can be a company that's worth $20 billion with 350 people full-time on staff just because we're an avatar tools company at the end of the day."

1 big thing: Genies wants to stay independent

Photo Illustration of Akash Nigam and a piece of avatar fashion from Genies. 

Photo illustration: Shoshana Gordon/Axios. Photos: courtesy of Genies

Data: Yahoo Finance; Chart: Tory Lysik/Axios Visuals

Disney wasn't able to escape the earnings bloodbath that hit the tech sector after the powerful media conglomerate suffered its worst day on the stock market in 21 years.

Why it's the BFD: Investors are worried about Disney's economics, particularly its growing streaming losses despite a continued strong uptick in subscribers, Tim writes.

With price hikes and an ad-tier coming, top Disney brass are assuring investors that those losses will shrink soon and turn into gains by 2024. 

By the numbers: Disney's 13% drop sunk its share price to its lowest level since the onset of the pandemic in early 2020. 

For the year, Disney's stock has fallen 44%. 

The latest: While his company's stock was imploding yesterday, Disney CEO Bob Chapek admitted investors are getting a bit antsy.

"There is an increasing desire by our investor base to make sure there is something there, there, to get something out of it," Chapek said during a Paley Center event in New York. "Our investors expect us to have a return on that investment."

2. The BFD: 📉 Steeper drop than Splash Mountain

Forbes is in advanced talks to sell to a consortium of family offices and global investors for $800m, per NYT. https://axios.link/3fQYJMP

Amagi, a New York-based media tech company building streaming video infrastructure, raised $100m from General Atlantic at a $1.4b valuation. It last raised $95m in March. https://axios.link/3DQidZQ

Notifi, a Seattle-based web3 communication infrastructure platform, raised $10m in seed funding. Hashed and Race Capital co-led, and were joined by Struck Capital, HRT Capital, Wintermute and Temasek's Superscrypt. https://axios.link/3EjZ7gj

Major League Pickleball agreed to merge with the Professional Pickleball Association's newly launched VIBE Pickleball League, which will form a new superleague under the MLP name. https://axios.link/3fSAais

GWR Studios, the production arm of Guinness World Records, partnered with WeShort to create original short-form series. https://axios.link/3UxcPSI

3. Deal flow

Formula 1 hired Isabelle Stewart as head of original content. She previously was director of content development and acquisition at Audible. https://axios.link/3X0F9P1

Gannett announced Maribel Perez Wadsworth, president of Gannett Media who was the first person of color to serve as publisher for USA Today, will leave Dec. 31. https://axios.link/3ToS0Y0

4. Movin' on up (or out)

Elon Musk tells advertisers they have to pay for blue badges (Axios)

"Musk tried to reassure advertisers that he is committed to brand safety and content moderation, but most of the solutions he offered were focused on products, over policy solutions," Sara Fischer writes.

"The company's unchecked metaverse investment and hiring might have been sustainable in a growing market, but the sudden, sharp slowdown in advertising is making that project's cost stand out as a problem," Ina Fried and Sara write.

How the MCU is addressing its messy history with diversity (Axios)

"It matters to be truly seen, to be heard in your authentic voice, and for stories to incorporate diverse perspectives for richer and more impactful narratives," said Kevin Strait, museum curator at the National Museum of African American History & Culture.

Rebuilding "Black Panther": How the "Wakanda Forever" family fought through grief and injury to create a $250 million superhero tribute (Variety)

"But just asking about whether [Ryan Coogler's] keen to direct a third 'Black Panther' movie, or the highly anticipated 'Avengers: Secret Wars,' elicits a weary sigh. 'I can tell you definitively I have no idea what I'm doing next,'" he tells Angelique Jackson and Adam B. Vary.

5. Channel surfing

Illustration of a TV color test screen in the shape of a wave.

Axios Pro editor George Moriarty here, with your digest from this short, but meaty, week of media news.

On Monday, Tim introduced us to Imax and chill, via an interview with CEO Rich Gelfond.

Plus: Monday's Pro Rata, which led with Dan covering Peloton co-founder John Foley's next big idea like a rug

Tuesday brought news that YouTube put Shorts on TV.

Plus: Tuesday's Pro Rata took a trek back to Twitter-land and Elon's exceptionalism

And on Wednesday, Tim's bottom line on the state of streaming said it all, "Welcome to the awkward teenager phase."

Plus: Wednesday's Pro Rata covered the mess at FTX, and what might be next, until more shoes drop ... and they did.

6. 🗞 Catch up quick

🎖️ Situational awareness: We're off tomorrow for Veterans Day. Be back in your inbox on Monday!

@tim_bays: "Black Panther: Wakanda Forever" at TCL Chinese Theatre. Making the most of my last LA moviegoing experience. 

@kerrymflynn: "Rigoletto" at the Metropolitan Opera. After being dragged to so many Broadway shows, my husband's taking me to his preferred form of theater. 

✏️ Thanks to George Moriarty for editing and Katie Lewis for copy editing this newsletter.

Thank you for reading Axios Pro Media Deals! Please ask your friends, colleagues and Wakandans to sign up.

November 10, 2022

1 big thing: Genies wants to stay independent