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Constellation, a New York-based marketing tech company, has secured $15 million from Newlight Partners, the company tells Kerry exclusively. 

Why it matters: The firm stands out for its focus on highly regulated industries, and it plans to use the funding to double headcount to 300 and explore acquisitions.

What they're saying: "They have this leadership position in auto. They're growing a leadership position in pharma," says Adam Stulberger of Newlight Partners. "We could see some add-on acquisitions to further bolster the products and services that Constellation is able to offer to these customers."

Catch up quick: CEO Diana Lee quit her job in 2016 and used $22,000 of her own savings to launch a digital marketing agency. 

After inking a licensing deal for its software, the business refocused toward its marketing tech, which offers a compliance section for specific sectors. Lee raised a friends-and-family round of a "few million" in 2019 to match the company's first multimillion-dollar contract, she says.

Her cofounders are Nauman Hafiz, formerly of R/GA, as chief technology officer and Matt Woodruff, formerly of Havas and Ogilvy, as chief product officer. 

Details: Newlight Partners' team has 20 years of experience investing in ad tech and marketing tech, Stulberger says. 

Constellation's clients have included Biohaven Pharmaceuticals, Sanofi, Volkswagen Group and Jaguar Land Rover.

The company's revenue grew 70% from 2021 to 2022, Lee says. 

Constellation recently hired former Pfizer and ConcertAI executive Melissa Gunn as senior vice president of customer success and strategic partnerships and former Takumi executive Derek Wiggins as senior vice president of business development.

What's next: Lee says her team wants to add clients in legal and insurance.

1 big thing: Marketing, but make it compliant

Constellation cofounders Nauman Hafiz, Diana Lee and Matt Woodruff

Constellation cofounders Nauman Hafiz, Diana Lee and Matt Woodruff. Photo: Adrian Bayona

The NCAA has picked Endeavor's Karen Brodkin and Hillary Mandel to advise on its next media rights deal, Sports Business Journal reports. 

Why it's the BFD: ESPN has paid the NCAA roughly $40 million annually, per the SBJ, during their current 12-year deal, which expires following the 2023-24 school year. 

Of note: The NCAA is considering a major change with its next rights deal by unbundling many of its championships, most notably the Women's Basketball tournament, Tim writes.

While major conferences such as the Big 12 and SEC negotiate their own rights, the NCAA controls the ones for its championships, with a major exception being the College Football Playoff.

The big picture: Up until now, the NCAA has bundled the rights to its championships, except for the men's basketball tournament and both men's and women's Division I golf. 

Along with women's basketball, the NCAA is considering separate agreements for women's volleyball, the Frozen Four, College World Series and Women’s College World Series. 

Breaking out those sports could make it harder for lesser-viewed ones, such as swimming, gymnastics, bowling and fencing, to garner TV dollars because those sports rely on being packaged with more popular ones.

What's next: Talks aren't supposed to begin with ESPN on a new deal until the end of this year, SBJ reports. 

NCAA may break its own bundle

2. The BFD: NCAA taps advisers for media rights sale

Illustration of a bitcoin connected to a baseball, basketball, and soccer ball

Illustration: Aïda Amer, Sarah Grillo/Axios

Data: Alphabet earnings report; Chart: Axios Visuals

The Justice Department is suing Google to try to force it to sell off a chunk of its massive, phenomenally profitable digital advertising business, Sara writes.

Why it matters: Having to spin out a key piece of the company's ad-tech structure would be technologically difficult, and it may be hard to find a company that would be able to buy it without facing regulatory hurdles.

But if Google were ultimately forced to sell or spin out the asset, its revenue and growth potential would be significantly stymied, creating an opening for more competition in the ad market, the DOJ argues.

3. Charted: DOJ vs. Google

North Road Company, Peter Chernin's studio, raised $150m from Qatar Investment Authority. It's already backed by up to $500m from Providence Equity Partners and $300m in debt financing from Apollo Global Management, per THR. https://axios.link/40f0LbL

Nexus, an Austin, Texas-based creator-monetization platform for live-service video games, raised $10m. Griffin Gaming Partners led, and was joined by Sony Innovation Fund, Valhalla Ventures and insiders Pace Capital and S3 Ventures. https://axios.link/40c9ag6

Cvent, a Tysons, Virginia-based events software provider majority owned by Vista Equity Partners, is exploring a sale that could fetch upwards of $4b, per the WSJ.  https://axios.link/3kZFzpX 

AMC Networks explored a sale in 2021 and received interest from Apollo Global Management and Providence Equity Partners, Bloomberg reports. https://axios.link/40hI2wd

BDG Media suspended Gawker and will lay off 8% of its full-time staff as it continues to search for a buyer or potential liquidity partner, Sara reports. https://axios.link/3RmFN6O

Defy.vc, an early-stage VC firm in Silicon Valley, raised $300m for its third fund. https://axios.link/3jtyVIa

4. Deal flow

Madeline McIntosh will step down as CEO of Penguin Random House U.S. once a new corporate leadership structure is established. She's the third senior executive to leave in the past two months, per WSJ. https://axios.link/3Rldd5O

NBCUniversal ad sales restructuring: Maggy Chan oversees global ad sales and partnerships, Mark Marshall leads converged national sales teams, Frank Comerford leads local ads and Dan Lovinger manages the Olympics. Tom Winiarski oversees the linear and digital bridge, Krishan Bhatia manages the One Platform tech stack and Josh Feldman oversees creative partnerships including content, talent, events and product innovation. It also launched a growth team for small and medium-size businesses. https://axios.link/3HUISbn

Cision, the Chicago-based media communications company, appointed Cali Tran as CEO. He was recently named president and CEO of Cision-owned Brandwatch. https://axios.link/3JuHzRj

5. Movin' on up (or out)

James Gunn unveils new DC reboot slate. Here's what to expect (Axios)

"'Superman: Legacy' will bring the classic superhero back with a new movie focused on his upbringing on Earth as well as his heritage from the planet Krypton, per the New York Times. The film, which Gunn called the 'true beginning of the DCU,' is slated to be released on July 11, 2025," Herb Scribner writes. 

Universal Music in talks with big platforms to overhaul streaming model (FT)

"Conversations are in the early stages, but one strategy being examined is creating a 'bonus pool' of money for artists who are driving more value to platforms by generating many streams from new users. Universal and Tidal are exploring ways to measure fan engagement, such as tracking the sharing of songs on social media," Anna Nicolaou reports.

Instagram's co-founders are mounting a comeback (Platformer)

"For now, [Kevin] Systrom and [Mike] Krieger are funding Artifact themselves, though I imagine they will soon have investors beating a path to their doors. A team of seven people is now working on the app, including Robby Stein, a top product executive at Instagram from 2016 to 2021," Casey Newton reports.

6. Channel surfing

Illustration of a pair of sunglasses with lenses that look like tv screens.

🗓️ Situational awareness: Join Tim and Sara Fischer tomorrow at 12:30pm ET for a conversation forecasting media trends in 2023 and analyzing the year's biggest dealmaking stories so far. Register to attend.

@tim_bays: "Black Panther: Wakanda Forever" on Disney+. Time to re-watch future Oscar winner Angela Bassett. 

@kerrymflynn: "80 For Brady" at AMC Theatres. Wow, what a day to already have tickets to an early showing dubbed "Ladies Night Out." I'll be wearing my Brady jersey — the Patriots one. 

✏️ Thanks to Michael Flaherty for editing and Jay Bennett for copy editing this newsletter.

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February 01, 2023

1 big thing: Marketing, but make it compliant