When Suroosh Alvi, Gavin McInnes, and Shane Smith founded Vice magazine, the intention was to establish a business with a rebellious, counterculture image. Smith famously gave a tour of Vice Media’s Brooklyn headquarters while partially naked and drinking alcohol, embodying the brand’s punk rock persona. Vice has become a household name, and next week, the company plans to sell itself out of bankruptcy. However, the potential buyer, GoDigital Media Group, does not reflect the edgy culture that Vice was built upon and may face criticism for it.
GoDigital Media Group, a lesser-known conglomerate based in Los Angeles, specializes in video and music rights, particularly in the Latin genre. Despite not having a physical headquarters due to the pandemic, the company plans to open a new office in LA later this year. GoDigital’s founders, Jason Peterson and Logan Mulvey, initially established the company by using cash flow from music-licensing rights to develop a cloud software company called ContentBridge. They later expanded their rights business to include artists like Jason DeRulo and T.I., investing $100 million into this division last year. Music rights ownership is the main source of revenue and valuation for GoDigital.
In recent years, Peterson has modeled GoDigital as a mini-Berkshire Hathaway, focusing on acquiring durable businesses that resonate with consumers. The company has made several acquisitions in media and commerce, targeting distressed assets with recognizable consumer brands. They purchased bankrupt companies like YogaWorks, Eastern Mountain Sports, and Bob’s Stores. After merging two of their subsidiaries, GoDigital now boasts a portfolio of seven companies and employs roughly 1,300 people, generating annual revenue in the high hundreds of millions.
Unlike Vice’s in-your-face culture, GoDigital aims to inspire happiness in both its customers and employees. Peterson emphasizes the company’s long-term perspective and compares it to a compound interest paradigm, where continuity of play is the primary goal. GoDigital’s executives believe that their bid for Vice is legitimate and credible, despite skepticism surrounding their finances and smaller assets. They are in talks with equity partners to secure the necessary funds for the acquisition.
If successful, Peterson and Mulvey plan to address Vice’s past mismanagement by aligning employees’ interests and passions with the company’s goals. They intend to treat each individual as a unique, valuable asset and create an environment where the confluence of personal interests and skill sets leads to success. Despite the lofty language, GoDigital’s executives firmly believe that combining passion and purpose will create a positive feedback loop and drive the company forward.
While taking on Vice undoubtedly comes with challenges, GoDigital sees similarities between Vice’s business and some of their existing portfolio companies. For instance, with YogaWorks, they disrupted an in-studio yoga consumer base by offering digitally distributed at-home classes through an online subscription service. This transition mirrors the changing habits of media consumption, and GoDigital aims to apply similar strategies to Vice.
In conclusion, GoDigital Media Group’s bid to acquire Vice may seem unconventional given their differing cultures, but the company believes it has both the financial means and the vision to turn Vice around. By focusing on employee alignment and pursuing a long-term perspective, GoDigital aims to restore profitability to Vice and create a harmonious and successful work environment.
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