100 Percent Fresh Exclusive!: Flixster/Rotten Tomatoes in Acquisition Talks With Yahoo and Others
Flixster–the popular social movie site whose brands include the Rotten Tomatoes premium reviews site, as well as BuddyTV–is in early acquisition talks with several suitors, including Yahoo, said sources close to the situation.
The price being discussed for the San Francisco-based start-up is between $60 million and $90 million, said several sources, in talks that are “substantive.”
Nonetheless, any acquisition negotiations could always fail. In fact, Flixster held advanced discussions in late 2007 with IAC/InterActiveCorp.
Along with Yahoo, which is interested in bringing in a strong team to bolster the entertainment offerings of the Silicon Valley Internet portal, sources said several media giants are also eyeing Flixster in order to strengthen their ties to entertainment consumers. Likely candidates in this regard include Disney and Warner Bros.
Interestingly, one of Flixster’s big shareholders is News Corp., which traded its Rotten Tomatoes unit for a 20 percent stake in the combined entity a little over a year ago.
But its minority stake gives News Corp. little influence over Flixster’s fate, although its IGN gaming unit head Roy Bahat is on the Flixster board. News Corp.–which has been shedding Web properties, such as its current effort to sell MySpace–is not bidding for Flixster.
But the interest in the site by Yahoo and others is obvious.
Flixster has attracted a huge online audience, which trades all kinds of recommendations, ratings, news and even post user-generated movie reviews on the Web site and via widgets on social networking sites, mostly on Facebook. Its recent mobile app efforts have been successful.
Co-founded in 2006 by CEO Joe Greenstein and CTO Saran Chari, Flixster has raised $7 million in funding from Lightspeed Venture Partners and Pinnacle Ventures, as well as garnering angel investments, such as from Silicon Valley entrepreneur and LinkedIn founder Reid Hoffman.
The combination with Rotten Tomatoes and its more robust Web presence made a lot of sense. It features mostly premium content, including professional reviews, trailer videos and news.
The site is famous for its clever fresh and rotten tomato rating system for movies.
A Yahoo spokeswoman declined to comment and I have not received a response from emails sent to Greenstein.
Until he does, here’s my video interview with Greenstein, Chari and COO Steve Polsky, in which they talked about the deal to combine Flixster with Rotten Tomatoes: