In another digital-media merger, Discovery-backed Group Nine Media has reached a deal to acquire female-focused lifestyle brand PopSugar.
The all-stock acquisition will bring PopSugar into the Group Nine portfolio, which includes Thrillist, The Dodo, NowThis, Seeker and comedy studio JASH. Terms of the deal weren’t disclosed. The pact values PopSugar at $300 million, and brings Group Nine’s overall valuation to $1 billion, the Wall Street Journal reported, citing anonymous sources.
PopSugar, founded in 2006, had raised $41 million in funding from Sequoia Capital and IVP. With the pact, PopSugar’s Brian Sugar and Lisa Sugar will join the executive team of Group Nine. In addition, Brian Sugar and PopSugar strategic investor Michael Moritz will join Group Nine’s board of directors.
“PopSugar hugely expands our reach within an important demographic, bringing us a community that deeply loves the PopSugar brand and a company with the proven ability to diversify their revenue across premium advertising, affiliate, direct-to-consumer commerce, licensing, and experiential channels,” Group Nine CEO Ben Lerer said in a statement.
The announcement comes less than a week after Vice Media said it was buying Refinery29, which focuses on an audience of millennial women. Last month, digital-media company Vox Media announced a deal to acquire New York Media, publisher of New York magazine. Companies in the sector are looking to achieve scale and synergies in their operations, as well as diversify their revenue base.
Last month, Group Nine announced that it raised $50 million in new funding from lead investor Discovery and strategic investor Axel Springer SE.
Group Nine claims the addition of PopSugar will boost its reach to more than half the overall U.S. population — with estimated unduplicated reach of 150 million in the U.S. alone — including 70% of U.S. millennials (people aged 18-34). Overall, Group Nine’s properties will have more than 200 million followers across platforms including YouTube, Facebook, Instagram, Snapchat, Twitter and TikTok.
Lisa Sugar, president of PopSugar who founded the company as a blog, touted PopSugar’s “trust factor and strong brand identity” among its fans. “The Group Nine brands share a similar passionate connection with their audiences as well as an ethos of optimism and action that truly excites me as we become part of the Group Nine portfolio,” she said in a statement.
In addition to its digital content and live events businesses, PopSugar sells a quarterly Must Have Box subscription stocked with various products and operates “Glow by PopSugar,” a digital marketplace for workout videos, merchandise and fitness tips. In addition, PopSugar has licensing deals and products that include its trend-based apparel collection with Kohl’s and a cosmetics line sold by Macy’s, Ulta and Kohl’s. PopSugar’s experience in those areas “will accelerate Group Nine’s expansion into commerce and direct-to-consumer businesses,” the company said in announcing the deal.
It’s the second acquisition for Group Nine after its initial formation in 2016, after buying Jash, whose whose founders include Sarah Silverman, Michael Cera, Tim Heidecker, Eric Wareheim and Reggie Watts.