Credit Crunch Forces ManiaTV To Put Itself On The Block
This story was written by Tameka Kee.
This one slipped out under the radar: digital content studio ManiaTV is searching for a buyer. The company retained investment bank Updata Advisors to shepherd the sale late last year, and has been meeting with potential buyers since January. CEO Peter Hoskins told TV Week that he was eager to close a deal within the next few weeks: "The timing we have placed is very quick. We don't want to be in a limbo state operationally and have everyone wondering if they need to look for a job, so it's a very short window."
Sources familiar with the situation say that a fire sale was practically inevitablebut not just because the economy had been drying up ad sponsorshipsManiaTV's funding was drying up, too. The L.A.-based studio raised $26 million since its inception in 2004, though it hadn't received all of its most recent round: the $9.5 million it reported last March. That round included $4 million worth of credit that was tied to specific performance goalsand the company couldn't meet them, even after a restructuring that included the layoffs of 20 staffers, and a shift from producing original content to brokering distribution deals. And that was just the latest reinvention: the studio tried featuring UGC and then dumped it in 2007.
Hoskins insisted to paidContent a few weeks ago that advertisers were increasing their spend with the studio, giving it a leg up over competitors in the midst of the tough market. Meanwhile, there's no word on whether this affects the forthcoming album from hip-hop producer Scoop Devilleas ManiaTV invested in, and built an online series around the development of the LP.
By Tameka Kee