It might be fairly a hearth sale after Quibi’s nearly $2 billion flameout: The Jeffrey Katzenberg-founded firm has tapped LionTree to handle the method of promoting Quibi’s belongings, following its resolution to close down.
A rep for LionTree confirmed that the agency has been enlisted by Quibi in an advisory capability to judge in-bound inquiries from events. New York-based LionTree, led by CEO Aryeh Bourkoff, is a boutique funding financial institution and monetary advisory agency specializing within the media and telecommunications sector.
On Wednesday, Quibi announced that its board had decided to shut down the corporate, lower than seven months after launching in April. The startup, led by Katzenberg and CEO Meg Whitman, instructed clients Thursday that it expects to shut off the streaming service “on or about” Dec. 1 — however that it didn’t know whether or not any of Quibi’s originals could be out there on different platforms after that. A number of of Quibi’s content material companions, who have been blindsided by the shutdown information, are now scrambling to find new homes for their productions.
Quibi’s asset-sale course of could end result within the switch of its rights to some originals to new distributors. However any dealmaking can be a bit difficult: Quibi has licensed the handfuls of packages for its service, however doesn’t truly personal any of the. Below its agreements with the content material homeowners, Quibi had secured seven-year licenses, with the producers of the reveals retaining the suitable to assemble the reveals and distribute them elsewhere two years after they premiered on the streamer.
In the meantime, a sale of Quibi’s expertise will seemingly include a authorized string connected: Eko, the Interactive-video agency that filed a lawsuit in opposition to Quibi alleging patent infringement and trade-secret theft over Quibi’s Turnstyle characteristic, stated this week it’ll continue to pursue the legal action. Quibi has known as Eko’s claims baseless.
With Quibi, the movie-mogul-turned-entrepreneur Katzenberg hoped to create a brand-new streaming class bombed in brief, sharp style. His untested speculation was that smartphone-centric millennials would shell out for short-form, HBO-style originals. Traders together with Disney, NBCUniversal and WarnerMedia ponied up about $1.75 billion, given Katzenberg’s movie-mogul pedigree. With its conflict chest of money, Hollywood bold-face names clambered aboard, attracted by Quibi’s enormous budgets, upwards of $6 million per hour of produced content material.
Finally, nevertheless, customers — with a bountiful and rising smorgasbord of different video choices — did not chew on the service, which carried month-to-month pricing of $4.99 (with advertisements) and $7.99 (with out advertisements). As of the third quarter, Quibi reached 710,000 subscriber households, down 300,000 from the prior quarter, per estimates from analysis agency Kantar.
Quibi additionally made a misstep in sticking to Katzenberg’s unique idea of a mobile-only service even after it was clear that viewers wished to stream the content material on living-room TVs. The corporate finally launched native apps for Apple TV, Amazon’s Fire TV and Android TV this week — simply two days earlier than it stated it’s winding down.
Katzenberg, in a statement this week, expressed gratitude to Quibi’s staff, traders, expertise, studio companions and advertisers. He boasted about having “assembled a world-class inventive and engineering workforce that has created an unique platform fueled by groundbreaking expertise and IP, enabling customers to view premium content material in an entire new approach.”
Whereas acknowledging that “our standalone enterprise mannequin is not viable,” he additionally stated that “the world has modified dramatically since Quibi launched,” evidently a reference to the COVID pandemic.