Spark Capital Rushes To First Exit With ThePlatform
iCrossing, June 30, 2006
By Erica R. Davis
Six months after investing in its first portfolio company, ThePlatform Inc., Spark Capital landed a major payback when the digital media publishing software start-up was purchased by Comcast Corp. for more than $100 million.
The deal was first reported on digital media Web site paidContent.org, which said the price was “in the $70 to $80 million range north of $80 million range,” citing sources. A person close to the deal told VentureWire the price was more than $100 million.
In December, Boston-based Spark put in the majority of ThePlatform’s $8 million Series B round, which also included Generation Partners. In 2001, ThePlatform raised a $4.5 million Series A round from Davenport Capital Ventures and other angel investors.
Spark Capital General Partner Bijan Sabet said Seattle-based ThePlatform was its first investment from its first fund, which closed with $260 million in the summer of 2005. The outcome was “very successful,” Sabet said, but he declined to specify the deal’s return for Spark. Spark invests in early-stage media, entertainment and technology companies.
Including ThePlatform, Spark has invested in at least four companies: San Diego-based video sharing Web site Veoh Networks Inc.; Sherman Oaks, Calif.-based mobile phone entertainment company Waat Corp.; and New York-based KickApps Corp., which is developing hosted applications for enterprise Web sites.
Sabet said the decision to sell so early was a tough one. “We just made the investment six months ago and had confidence it could be a big, category leader,” he said. “In recent months, a lot of companies have been circling around wanting to buy.” Spark concluded Comcast offered the best outcome, partly since the companies had been business partners for two years.
Based in Seattle, thePlatform makes software providing digital media publishing for media, entertainment and enterprise companies to put their audio and video content over the broadband Internet to computers, mobile devices and digital set top boxes to televisions.
Comcast currently uses ThePlatform software to power its broadband video portal called TheFan, ThePlatform founder and Chief Executive Ian Blaine said. ,/
After the acquisition, Blaine said ThePlatform will keep its 70 employees and its customers, becoming a wholly-owned subsidiary reporting to Comcast Interactive Media Group.
ThePlatform will integrate Comcast’s digital media services into its platform, such as turning satellite video content into digital files, video encoding and video production. Services will be integrated over the next several quarters, Blaine said.
“This is a great opportunity to increase our leadership position in the market,” the CEO said.
“We’re going to support their capabilities so they can provide more services and better support,” Comcast Interactive Media Executive Vice President Sam Schwartz said.
ThePlatform’s 60 customers include ABC News, Amp’d Mobile Inc., Bank of America Corp., Verizon Communications Inc. and Microsoft Corp. ThePlatform closed about 10 customers in May, more than in any previous month, Blaine said. He declined to discuss revenue or profitability.
Partners at Generation Partners weren’t immediately available to comment.
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