Vox Media Raises $34 Million to Expand Video Business
Vox Media may only have three sites to its name -- The Verge, SB Nation and Polygon -- but that hasn't stopped the D.C.-based company from stuffing its pockets.
The digital media company has raised $34 million in funding with plans to add an additional $6 million to close the round at $40 million, according to documents filed with the Securities and Exchange Commission. Accel Partners led the funding round and was joined by fellow previous investors Comcast Ventures and Khosla Ventures.
Vox Media eventually plans to extend into new content verticals, but CEO Jim Bankoff said he primarily plans to invest in the company's existing properties and expand its video content. "You will see a whole lot ... more video product from us, better video product and more widely distributed," he said. Vox Media Chief Operating Officer Marty Moe said connected TV apps are "squarely in our future...I wouldn't put them in the distant future."
"Part of the model here at Vox is building a media company that's equal parts magazine and news publisher and equal parts video producer and publisher…We are seeking to create an experience that feels as much like TV programming as magazine publishing," Mr. Bankoff said.
The Verge may be closer to that future than its sibling sites. The tech news site has been publishing videos of product reviews and late-night-style talk shows since its launch in November 2011. This past May, The Verge added a dedicated video hub to highlight the breadth of its videos, from breaking news coverage to short-documentary features. Editor-in-Chief Joshua Topolsky said the site plans to beef up its longform videos next year and expand the middleground between features and breaking news by doing more weekly and daily reporting videos.
The Verge has also expanded its editorial coverage from gadget launches and reviews to social media companies going public to patent suits to PRISM. Mr. Topolsky said the site isn't on path to become the next omnivorous Huffington Post of BuzzFeed. "We do not want to cover everything. We do not want to be CNN," he said.
To contend with those all-encompassing news outlets would be a tough ask, but in its two-year existence The Verge has already gained ground on its closest competitors. At 5.62 million unique visitors in September --compared to 425,000 in its first month after launching -- The Verge has amassed a larger audience than competitors AOL-owned sites TechCrunch (5.21 million) and Engadget (5.04 million) as well as Conde Nast's Wired.com (5.06 million), according to comScore. However it lags behind Gawker's Gizmodo.com, which notched 8.39 million visitors that month.
By comparison, SB Nation received 8.84 million unique visitors in September, and Polygon attracted 947,000, per comScore. Across desktop and mobile web in August, Vox's three properties spanned 18.88 million visitors, though that doesn't account for people who may have checked out two or more of the sites that month.
Mr. Bankoff declined to disclose Vox Media's revenue numbers, but said that the company's revenue has "roughly doubled" compared with last year, is profitable this quarter and will close the year in the black.
Prior to this latest funding round, Vox Media had raised $35.6 million, according to the company's SEC filings. That figure does not include $487,918 that remained to be sold as of Vox's last funding filing in March 2012.
Accel Partners had led Vox's first funding round in 2008. That initial investment came from Accel's fund dedicated to early-stage companies, but this most recent round moves Vox into the investment firm's growth fund that concentrates on later-stage companies. Accel had previously invested in Facebook as an early-stage company then reupped with the social network through the growth fund.
"The growth fund looks for later-stage opportunities: great entrepreneurs, great sectors, bigger companies of size, scale, profits and everything else...Vox fits that bill," said Accel Partners' Ryan Sweeney who leads the growth fund.
"Later-stage" can be synonymous with "ripe to go public," though Mr. Bankoff shrugged off the notion. "We just closed financing. We're not focused on anything other than executing on our plans," he said.