Upside Media gets new owner

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San Francisco--Upside Media Inc., having so far survived the great shakeout among the new economy titles, this week was able to avert bankruptcy when MCGI Capital Corp. on Wednesday took control of the company.MCGI, Arlington, Va., has infused Upside Media with between $8 million and $9 million in the last two years, according to Andrew Jacobson, managing director of MCGI.Earlier this week Upside shut down its Web site, which provided financial news. MCGI said it would continue to publish Upside magazine, which has let go nearly three-quarters of its staff from a peak of 115 a year ago. CEO David Bunnell will stay on as editorial director.Jacobson said Upside, which launched in 1989, continues to be an effective marketing venue. "It's got fairly broad appeal and a lot of leverage to the brand, which will enable it to go forward once the economy bounces back," he said. "It's hard to judge against all the other brands [in the space] because they're all going through revamps."Reed Phillips III, a managing partner with the New York-based investment bank DeSilva & Phillips, said Upside still has to recognize that both Time Inc. and Gruner + Jahr USA Publishing are in the marketplace for the long haul with Business 2.0 and Fast Company, respectively. "They have to offer advertisers and readers an alternative, which I think it is," Phillips said, adding that by significantly slashing its staff Upside should be able to weather the current tech sector storm. MCGI Capital subsidiary Umac Inc., San Francisco, is now the holding company for Upside Media.

--Matthew Schwartz

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