“MEG” investor Alignment Growth bought a minority stake in unscripted producer Wheelhouse. The M&A and talent growth plan is simple, and compelling.
Let’s break it down…
WHEELHOUSE OVERVIEW
• Diversified prod and media co
• Founded 2018 by unscripted vet Brent Montgomery
• Brent previously founded Leftfield Ent, sold to ITV in 2014 for > $360M
• Prod Co’s incl Spoke Studios, Campfire, Butternut, Wheelhouse UK, DNA
• Prod Partnerships w/ Jimmy Kimmel's Kimmelot and Chef David Chang's Majordomo Media
WHEELHOUSE DIVISIONS
• Entertainment – Prod co comprised of 6 studios, focus on unscripted
• Wheelhouse Labs – brand mktg services incl social strategy, branded content, IM
• Wheelhouse DNA – digital arm incl podcasts, video strategy, talent mgmt co Additive Creative
• Houses – 4 event spaces in NY / LA
M&A + CAP MARKETS ACTIVITY
• Initially financed by Brent in 2018 via earnings from ITV sale, est in mid 8 figures
• Bought minority stake in branded content co Portal A in 2019
• AG investment is 1st outside funding round
ALIGNMENT GROWTH
• Growth stage investor in media & entertainment, gaming, and “MEG enablers”
• Raised $360M in 2023
• Founded 2021 by Jeff Bewkes (former Time Warner CEO) and Kevin T (former Warner Bros CEO)
• Adds ops / deal / strat experience to portfolio cos via Fortune 500 exec team experience
• Investments incl fever, build a rocket boy, crunchbase, spyglass media
INVESTMENT
• Led by Alignment Growth
• Minority stake, terms undisclosed
• AG partner Jeff Bewkes joins Wheelhouse board
• UOF: attract top industry talent, grow through M&A
MY TAKEAWAYS...
CEO Brent and his Wheelhouse team are some of the world’s best unscripted producers. They have much momentum w/ buyers (20 sold shows in 2023!), and see the chance to work with bigger talent names, more often. This would allow WH to sell even more shows at higher budgets.
And to help increase their content throughput, they need more prod teams, and fast. To that end, there’s likely many production co’s who don’t have the buyer access that WH does, but have teams and capabilities that can be bought at good prices while the TV / streaming industries consolidate.
And now WH has the funds to execute against this 2-pronged strategy, and quickly. If they can stay focused in this lane, I think they’ll do quite well.
To the above point…
My guess is 90% of profit comes from the sale of unscripted series to TV / streaming. Unclear if the other biz lines are breakeven and / or what their path to profitability is. Makes me wonder how much longer those other divisions will be resourced by Wheelhouse.
Growth comes from ruthless focus.
The real money here seems to be growing the unscripted production biz.
Disclosures: I’ve hosted events at Wheelhouse spaces, and have advised Portal A on various projects.
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I'm the founder of RockWater Industries. We do M&A and strategy advisory for media, agencies, creator economy. My DMs are open.
#media #agency #creatoreconomy
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