Warner Bros. Leads $24 Million Investment in Machinima
The studio previously led an $18 million investment in the gaming-centric digital media company and YouTube network.
Warner Bros. is building on its relationship with gaming-centric digital media firm Machinima.
The studio has led a $24 million financing round in the company, which also operates a YouTube network. Existing investors Redpoint Ventures, MK Capital, Coffin Capital and co-founder Allen DeBevoise also participated in the round.
Warner Bros. was also the lead investor when Machinima raised $18 million in March 2014. At the time, then-CEO DeBevoise was actively seeking his replacement, and the company had just conducted a round of layoffs. Since then, the company tapped former Ovation executive Chad Gutstein to run the company, and he has repositioned Machinima as a programming service dedicated to fandom and gaming culture. Machinima currently reaches 170 million monthly unique viewers, representing 70 percent growth over the last year, according to the company. The Machinima YouTube network, meanwhile, has more than 430 million subscribers worldwide.
"Under Chad's leadership, Machinima continues to grow as a key entertainment destination for millennials," said Craig Hunegs, president of business and strategy at Warner Bros. Television Group. "With its enormous fan base, Machinima is an important exhibition partner, providing content creators, including Warner Bros., multiple platforms for distributing and monetizing digital content and programming brands."
Machinima has had a long relationship with the studio, which began with live-action web series Mortal Kombat: Legacy. Later this year Machinima will release animated series Justice League: Gods and Monsters Chronicles in partnership with DC Comics and Blue Ribbon Content, the digital short-form studio inside Warner Bros.
Said Gutstein: "This additional funding will enable Machinima to accelerate our growth through increased investments in content and technology that better serves our audiences, advertisers, creators and distributors."
Warner Bros. has chosen to invest in Machinima, while Disney and DreamWorks Animation have purchased YouTube networks outright. CEO Kevin Tsujihara, speaking at a technology and media conference on Wednesday, said the studio hasn't bought an MCN because "we haven't been able to figure out the right model and how to, quite frankly, make money from owning some of these networks at this point in time." But he admitted that the young, male demographic is increasingly turning to online channels for content and noted that "we're going to have to own some of these platforms" to have a direct relationship with that audience.