Michelle Clancy | 19-08-2013
21st Century Fox has put $70 million into Vice Media, a move which gives Fox about a 5% stake in the company and values Vice at $1.4 billion.
Vice started off as a magazine in 1994, but soon expanded beyond print, renaming itself as Vice Media and adding online video (VBS.tv and a YouTube channel), a record label and a film production company. The company also has a news magazine show on HBO, called simply Vice.
The company brought in around $175 million in 2012 revenues, with more than 80% of that coming from the Web. Vice's online channels run the gamut from music, art, technology and mixed martial arts, but all focus on the younger demographic. It's also known for controversy and stunt-making: in February the HBO show brought former NBA star Dennis Rodman and three members of the Harlem Globetrotters to North Korea as self-styled diplomats, where they met with Kim Jong-un, the country's president. He subsequently vowed to return to North Korea at the beginning of August to attempt to exfiltrate imprisoned American Kenneth Bae, a missionary and tour operator Bae, who was arrested by in November and sentenced to 15 years of hard labour. Recent videos show Bae in ill health, sparking calls for his release from the US Government.
A tweet earlier in the year indicated interest in the company by Rupert Murdoch, 21st Century Fox's chairman and CEO. He called Vice a "wild, interesting effort to interest millennials who don't watch or read established media."
"I want us to be the next MTV, ESPN and CNN rolled into one – and everyone always rolls their eyes," said Shane Smith, Vice's co-founder and chief executive, speaking to the Financial Times.
"The reality is that MTV was bought by Viacom and CNN went to Time Warner. We have set ourselves up to build a global platform but we have maintained control."
Vice said that it plans to use the money to push into India through 21st Century Fox's Star, and in Europe, it will leverage Sky channels in the UK, Germany and Italy to expand distribution.
Vice also previously received funding from ad company WPP, The Raine Group and former Viacom CEO Tom Freston, who consulted on the Fox deal. "The idea was to raise capital to help fund a lot of the initiatives we want to undertake more aggressively outside the US – but also have some strategic alliances with a company that has robust distribution," Freston said.