Comcast-DailyCandy: Interview: Sam Schwartz, EVP, CIM; Pete Sheinbaum, CEO, DC
This story was written by Staci D. Kramer.
Some acquisitions barely need explanations, That's not always the case when Comcast (NSDQ: CMCSA) Interactive Media opens the virtual checkbook; people are still asking me about Plaxo and today's announcement about DailyCandy, while less eyebrow-raising, still needs some 'splaining. CIM EVP Sam Schwartz and DailyCandy CEO Pete Sheinbaum did just that during an interview soon after the news broke. Neither would talk numbers but sources close to the deal say it's about $125 million. (They also declined to talk about information I had that the deal is roughly 10 times cash flow cash flow of about $13 million and total revenue of $23-25 million.) Schwartz described DailyCandy as "a high-monetization property" and "another step as we try to grow into a major presence" online. Comcast plans to keep the full DC team. Some highlights:
What are you going to do with DailyCandy? How does it fit in strategically?: Schwartz spoke of DC's growth from a very small idea eight years ago to a company that serves 2.5 million subscribers. "Those subscriptions represent a very loyal, engaged high-value audience for their advertisers and we think we can take what they've created and the stage that they got to so far and apply that to some new ideas we have both horizontally and vertically. The team there is fantastic, combined with the team we already have that's focused on Fandango and Fancast and our property Comcast.net, as well as our linear television channelsE, Style Channel and E Online. I think we've got a lot of interesting new businesses that we can grow, taking their unique editorial, their unique voice and their unique audience and bringing additional information to that audience with the kind of entertainment properties and content that we haveand also take their ability to create that editorial and bring it perhaps to other demographics with some of the other content that Comcast has. We're really excited. It fits right in. It's a high-monetization property and it's another step as we try to grow into a major presence." Lots more after the jump.
Do you see any possibility of applying this on the MSO side to the locals?: Schwartz: "Obviously, Comcast is a very local company. We have a couple of thousand local sales people in the markets that we serve. We have relationships. ...Even online, in terms of Comcast.net, it's a very customized local experience. Fancast, which is our online property for navigating through your entertainment choices, by design we know where you live because we set it up to work well with your television lineup in your town. Same thing with Fandango, the bridge between the consumer and their local movie theaters. When you combine that with the local aspects of the way DailyCandy already operates, there's a lot of potential for putting together some interesting approaches to local for consumers."
Why Comcast and why is this the right time?: Sheinbaum: "We know that media consumption habits are starting to change or have been changing for a little while. We've been watching very carefully about how and where our young women readers are going to be consuming content. We've been putting together plans to explore other platforms, to grow our existing web business, grow our mobile businessboth of which we currently have but we're going to start to invest inas well as trying to figure out how people might want to personalize our content or bring our content with them." He said the relationship began with the two companies exploring ways to work together on different platformsmatching DC's listings on restaurants with movie plans. "Why not marry the Fandango.com and DailyCandy content together on our platform or their platform or some sort of hybrid? Same hing with Comcast.net. They're providing local content and that's what we do. If they can help us introduce our content to their readers, what a terrific marriage that would be for us to provide a deeper and richer experience." As a top 10 site, that would give DC a boost for its model.
As for timing, no real answer. Sheinbaum said the company was growing under private equity ownership and called this serendipity. Schwartz said CIM had been following DailyCandy for a while and got serious during the last six months.
By Staci D. Kramer