Peter Kafka

Recent Posts by Peter Kafka

Booming Vox Media, the People Behind The Verge and SB Nation, Raises Another Huge Round

a-big-fat-wad-of-moneyTech investors are supposed to avoid content businesses. But they do make exceptions: The people who brought you the Huffington Post, for example, have been able to raise a ton of money for BuzzFeed.

And Jim Bankoff, a former AOL executive who is building his own digital publishing empire, has raised even more. Bankoff’s Vox Media, which had previously raised nearly $40 million to bankroll sites like SB Nation and The Verge, has raised another $34 million in a round led by Accel. (Update: Fortune’s reliable Dan Primack reports that the round will eventually head up to $40 million, which makes sense if you look at the SEC filing.)

It’s reasonable to assume that Bankoff will use some of that money to buy more “verticals” and grow his business that way. But Bankoff said the first priority is to “invest in our core,” which includes gaming site Polygon.

It is a pretty big core already. Right now, Bankoff’s three sites are generating nearly 60 million visitors a month, according to Quantcast. That figure has doubled in the last year. Bankoff had previously predicted that the company would turn a profit this year, and today he said he’s still on track to do that.

From the outside, that’s sort of hard to fathom, since Bankoff’s sites — The Verge in particular — have the sort of big production values and large staffs that Web display ads aren’t supposed to support anymore.

Bankoff insists that he has figured out how to crack the code on Web advertising by turning his sites into a “brand-building medium” for marketers. But I’ll reserve the right to skepticism on this one until I see a P&L.

And I suppose I might, someday. At this stage, Bankoff has raised so much money that it’s hard to imagine a natural acquirer for his business — at least at the valuation he and his backers would expect — unless he can convince Marissa Mayer that she needs his content mojo over at Yahoo, or if he can persuade Time Inc. that his digital know-how can help float the company as it spins out of Time Warner.

So, maybe he raises another round or two, rolls up some other sites (I think this is what Business Insider’s Henry Blodget* was hinting at in the last paragraph of this piece), and files an S-1.

Can’t imagine a digital-only media company going public? I know. But they’re not supposed to be raising giant funding rounds, either.

* I own a couple shares in Henry’s company. So it’s possible that this scenario could be good for me.


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