For Sean Beckner and his company ViralNova, it’s a case of good things come to those who wait. For a more than a year, he had been spurning investors looking to buy in to the digital publisher, which specializes in highly-shareable videos and listicles with titles like “What This Widower Was Handed After Dinner Left Me in Tears” and “Do You Ever Wonder If Horses Love Big Bouncy Balls.” Then, after a seven-month courtship, he finally sold the company to Zealot Networks this week in a deal combining cash, stock and earn-out that is reportedly worth $100 million.
It’s been a quick, steep climb for ViralNova. The site was launched in May 2013 by Ohio-based web designer and SEO consultant Scott DeLong. By November of that year, it was claiming more than 100 million unique monthly visits, putting it in league with top viral content purveyors BuzzFeed and Upworthy, which respectively reported 130 million and 87 million unique visits during the same period.
There were rumors that DeLong was looking for a big cash-out. Instead, he brought on Beckner as the majority partner in March 2014. With Beckner as CEO, ViralNova moved its operations to Midtown Manhattan and expanded its staff from two to twenty-four, while repeatedly turning down offers from venture capitalists and other interested parties.
It was a risky move, given the volatility of the viral content space, where fortunes can change with a tweak of Facebook’s algorithms. But it paid off.
Beckner spoke with VideoInk about the future of ViralNova and why he chose to sell to Zealot, the cash-rich company co-founded by former Maker Studios CEO Danny Zappin.
When you were considering the sale, what was your biggest fear?
I think it was the balance, [which is why the sale] is kind of 50–50 cash and stock. Anytime you sell, you lose control, right? So you want to make sure there’s enough cash that we’re getting rewarded for what we’ve built and make sure there’s enough upside in stock that we can be a very meaningful part of the business.
How did you connect with Zealot Networks?
We’ve always turned away venture capital, even some strategic investors, because we didn’t need the cash. And, of course, they always want some level of control. So we were pretty content with just doing our own thing. Then Danny reached out to us near the end of last year, looking for pieces that could help grow Zealot, and we weren’t interested in selling. But we started having some additional conversations, and as we learned more about Danny’s vision and what we he was building, we got really intrigued and excited.
ViralNova has a big digital audience. If you look at something like Vice, their audience isn’t bigger, but they have a big sales team, great relationships with brands, [and] they do a lot content creation and [put] shows on TV. And we knew it would be really hard for ViralNova to just go and try to start doing that or raise $50 million and create a video studio like BuzzFeed did. So we saw Zealot as someone who had a ton of experience with video with Maker and YouTube, and was acquiring companies that have great relationships with brands, musicians, athletes and celebrities. They have an event company now, too, so it’s really kind of this holistic offering for brands, and we stood to be a major piece of that.
Have you done any branded content and, if not, are you looking to get into that area?
We’ve done just a little, and we’ve just started venturing into that more these last few months. I think it’s something that with Zealot’s brand relationships we plan to do a lot more going forward.
If I’m a brand, what’s your pitch to me? Why do I want to use ViralNova?
I think that with us we really want it to be a collaborative effort. Nowadays, a lot of the big sites out there are really expensive [and] they don’t give a lot of creative control to the brands. From what we hear, they say, “We’ll write a story,” but they don’t give a ton of feedback. We don’t want to be that way. We really want to work closely. We have the creative team, and we’ll pitch and have them work with us to make sure it fits their brand really closely, and get it the eyeballs that they want.
New online video platforms seem to be popping up every other week. Where does ViralNova get most of its views?
If you go back a year, probably 90% of our traffic was from Facebook, and now that number is more around 60%. We’ve grown on Pinterest a lot. Twitter’s grown some. Our direct traffic, our search engine, newsletter traffic — we’re growing all of those areas. We want to be a well-diversified property.