Kevin Meyer and Tom Staggs have been in the media industry long enough to resist the urge to overreact to Netflix’s latest disasters. While his startup investment company, Candle Media, owns two major Netflix providers.cocomelon The production company Moonbug Entertainment e Fauda Producer Faraway Road – It seems they aren’t too worried about Netflix’s downfall. (And during the press, the hitherto unimaginable scenario became much more exhilarating.)
“We still strongly believe in streaming in general, now and in the long term,” Meyer said. “The address market is huge and continues to grow as consumers expect and demand the convenience of streaming.”
Comments from Netflix executives on the company’s latest quarterly report, which helped reduce the company’s value from $ 300 billion to $ 100 billion, “underscore the struggle for customer acquisition and retention,” he said. Stags said. Killer content is usually the answer to this challenge, claiming to be what drives his work. “Indeed, growing competition and continuing economic turmoil actually underscore the importance of differentiated content,” added Stags. “And this is where we focus in Candle.”
Before founding the company last year, with nearly $ 2 billion in support from private investment giant Blackstone, Stags and Meyer worked together as senior Disney executives for more than two decades. According to Meyer, his latest adventure thus far has been “completely uninterrupted”.
The first part of his Disney career was marked by a memorable episode dating back to the 2004 broadcast of the editor and writer of the magazine Chris Anderson. They created a document called Disney 2015, which predicted that mediocre content would no longer stand up to new technologies and a well-defined and crowded niche market. They presented him during a retreat aboard a ship in Orlando.
Stags and Meyer, who were considered Iger’s alleged successors, helped develop major transactions such as acquisitions of Marvel, Pixar and Lucasfilm. Meyer’s perspective was highlighted by leading a strategic planning team and later to Disney +. Staggs was in charge of CFO, COO and theme parks.
Meyer switched to the helm of Disney in favor of Bob Chapek. The announcement of Chapek’s promotion revealed that Meyer was wrapping up her decade of working at Disney to become CEO of TikTok. But then, three months later, Meyer ditched the Chinese-born social video platform amid increased scrutiny by the Trump administration and continued threats of forcible closure in the U.S. Meyer and Stags stood ahead of Candle, a trading company. special purpose acquisitions, or SPACs. Though the once-flying SPACs have suffered a bit of grime, the two claim to be still active, even though candlelight is their priority. (Both names are also rumored to have possible starring roles at Warner Bros. Discovery or even Disney, but remain firmly focused on their new venture.)
They operate in a different price range from Disney’s days, but in a way that makes the chase even more exciting. $ 71.3 billion acquisition of most of the 21ქ Century Fox, which Mayer helped orchestrate, is a few worlds away from Candle’s sweet spot, but the top is therefore much larger. The goal, as then, is to recognize the undervalued business and invest resources in it to make it profitable. And a strong market for mergers and acquisitions, especially as all players rush to stream, means potentially game-changing transactions are lurking around every corner.
Candle bought Moonbug for $ 3 billion last year, after which Reese Witherspoon acquired a significant stake in Hello Sunshine, valuing it at $ 900 million. Kendall was also involved in the Westbrook, Will Smith and Jada Pinkett Smith manufacturing facilities.
Meyer and Stags see the potential to further develop the companies they have acquired. Hello Sunshine is reviewing the children’s entertainment portfolio and features like Moonbug have been added to the lineup. bright spot on a radar And Little Angel, the latest YouTube network with 88 million subscribers.
While the Moonbug’s price has surprised many casual observers, everyone whose preschool education was a pleasure. cocomelon Understand your magnetism. After seeing the huge impact of children’s prices at Disney, Meyer and Stags are hoping the same dynamic can pay dividends (currently) on a smaller scale.
“cocomelon “Not only is it the largest channel on YouTube, it was also the second most popular show on Netflix last year,” Meyer said. According to Netflix, “This degree of popularity and repeatability makes it one of the most effective shows for their service.”
The motivation for pursuing independent companies is simple, Meyer said. “Hollywood is now architectural thanks to streaming services… they’re all vertically integrated. HBO Max cannot be licensed by Disney and vice versa, and if you want licensed content that you do not have or do not have the ability to create content because it is Apple TV +, you must purchase it separately and the demand for such TVs and movies is growing. more than ever.
Speaking of growth, the company’s staff at the end of 2021 was made up exclusively of Meyer and Stags. Since then, he has hired Salil Mehta as CFO and Brent Weinstein as Director of Development. Most recently, he hired senior executives Courtney Capa and Kendall Ostrow as senior vice president of finance and accounting and senior vice president of business and community development.
Which way does the candle seem to go from here? “We are focused on investing in both the growth of our existing operations and further acquisitions that are expanding our business and brands,” Stags said.
The company’s latest deals include child ownership Little Angel, content trading and community brands The Home Edit and ATTN, the Gen Z and Millennial social media storytelling company. On Tuesday, Deadline reported that Stags and Meyer had announced the acquisition of Spanish-language content Exile Content Studio.
Stags sees two or three more deals in the near future, and while they haven’t thought about what field they’ll be in, they are excited about the economics and ecommerce of the creators, as well as the already established manufacturing companies. Online TV networks that generate significant cash flows but are in secular decline are less likely to join the wallet.
Blackstone’s structure doesn’t include the traditional notion of controlling potential investments, the lead duo said, even though the company is Candle’s largest shareholder. While pursuing their investments and maintaining modest spending, Meyer and Stags say they are considering offering the company a public offering, even if there is no urgent need or time for this effort.
What if the weather changes a few months after the investment? Asked whether Will Smith’s devastating Oscar of the night blow to Chris Rock and everything that followed would lead to some sort of shift in Kendall Westbrook’s stance, Meyer didn’t hesitate. “We are highly committed to Westbrook and believe the team will continue to build a strong and broad business,” she said.
More broadly, the M&A market is still active, but the economic environment has become even more frustrating, with rising interest rates, the Russian invasion of Ukraine and further supply chain surges and concerns. on work affecting investors. “We also expect that the recovery of valuations we have seen in public markets will be reflected to some extent in private market valuations,” Meyer said. This trend is clearly positive for us as short-term buyers.
Candle is not just another passive investor. Meyer and Stags say Candle’s combined team of in-house and company personnel is approximately 400 people. “We think of Candle as an integrated company,” Meyer said, and the goal is to foster collaboration. Many executives from the companies they invest in, including Witherspoon and Sarah Harden, CEO of Hello Sunshine, will be joining following the Candle Board transactions.
“We want to find, as I think we’ve already found, some great companies with great leadership that we can position through scale, capital, synergy and brand experience and things like that before they can go any further. They’ve become independent, he says. Stags, but in a way that doesn’t take into account their creative vision or what they are trying to accomplish as individuals.
This is a family toy book for the Staggs. “We helped create the design that allowed Pixar to continue growing at Disney, allowed Marvel to thrive within Disney, and gave the same to Lucasfilm. So we understand this construction and this hierarchy ”.
Source: Deadline
