Bob Pittman Will Buy You Now
Taking up an austere few thousand square feet on Madison Avenue are the offices of the Pilot Group, a shadowy private investment firm run by Robert Pittman, the poor sap who took the fall for the AOL/Time-Warner merger. Of course, they're not really shadowy, just secretive and private and investy, and Bob Pittman is anything but poor. The Pilot Group specializes in "control positions" (i.e. they like to top) on emerging new media and Internet companies. Most famously, the P-Group purchased a controlling stake in girly e-newsletter Daily Candy for $3.5 million in 2003, then put DC on the block earlier this year for $100 million. That sale ultimately didn't happen, as really — $100 million for an email list? Even so, Pittman and Pilot still managed to score an undisclosed minority investment to placate those other stakeholders who wanted their Bubble 2.0 money right now. Comes the rumor that Pilot has inscrutably made a deal for music blog Stereogum. (Perhaps this will console Stereogum's Scott Lapatine after last night's altercation with Jared Leto.) No doubt, you're asking yourself — hey, I have a blog, how can I get Robert Pittman to cover me in bags of filthy lucre? Know your quarry, after the jump.
Pittman's history within Time-Warner lay primarily with MTV, so he's cool with what the kids are saying. He's also done boardroom time at places like Cendant and videogame factory Electronic Arts. He definitely has a thing for the e-mails, as in addition to Daily Candy, Pilot reputedly tossed about $300K into the manly coffers of male-mail service Thrillist. Incestuous side note: Thrillist lordling Ben Lerer is the son of Ken Lerer, cofounder of the Huffington Post, which Pilot may also have a minority stake in. Beyond that, Pilot has amassed a small portfolio of net-friendly small media properties, like the Double O radio network, 21 TV stations via Barrington Broadcasting, and a net marketing company (and former iFilm subsidiary) called OTX.
And Pittman has his socially conscious side as well, from throwing money at Eliot Spitzer to the "venture philanthropy" of the Robin Hood group. One assumes he's perhaps not quite so cavalier these days about personally flying planes at shareholder expense. There is one puzzling component of Pilot's portfolio, that being the Contours Express chain of women's gyms. Not sure what that has to do with new media, but to their credit, Daily Candy hasn't started gushing about the benefits of positve and negative resistance.
That aside, Daily Candy remains Pilot's prize, but you have to wonder — how does one realistically turn even an admittedly fine e-mail list into an $130 million valuation? Skittish investors didn't buy it either — at least not yet — even though DC's self-projected 2006 revenue comes in it at "somewhere less than $20 million." Given that, the asking price could have been even higher than $100 million, and yet it wasn't, and nobody bought it anyway. The AOL/Time-Warner merger debacle aside, Pittman and the Pilot Group have a reputation for being among the most canny new media investors out there, but the deciding hand in their big buy remains mostly unplayed.