Hearst Corporation, founded by fabled businessman William Randolph Hearst more than 125 years ago, has been a stalwart of corporate venturing for at least two decades. Hearst Ventures now has more than $1bn in strategic investments in companies operating at the intersection of media and technology.
As an early adopter of corporate venturing, it can lay claim to starting its investment program as one of five corporate investors in Netscape, the US-based search engine widely credited for kicking off the dot.com boom due to the success of its initial public offering in 1995, the same year as Bronfin’s partner, Scott English, joined the team.
Kenneth Bronfin, when he was made senior managing director of Hearst’s corporate venturing unit Hearst Ventures in 2013, said: “Our first investment was Netscape, and that was a great place to start. At the time, the founders of Netscape had the insight to reach out to a number of large, progressive media companies to encourage them to publish on the internet. We followed their advice, got started on our web efforts around the company, and also made a strategic investment in the company.”
The company has had other notable successes. Bronfin, who was deputy then group head of Hearst Interactive Media for nearly 16 years until he was made senior managing director of ventures, added for 2016’s Powerlist: “We invested in video on the internet in the early days. Our first investment in the space was Broadcast.com, with Mark Cuban. This became a valuable company, ultimately acquired by Yahoo. We were an early investor in Brightcove, which has built itself into a terrific company serving the publishing community.”
The company is involved with corporate venturing to stay abreast of changes in the sector. Increasingly, this means deals outside the US. Hearst Ventures made Katie Hu general manager of its China investments in 2014, then hired Megumi Ikeda as managing director for Europe and its Israeli venture investment office run by Gil Canaani.
Its investment approach by sector has remained largely consistent. Bronfin said: “Our sectors of interest have essentially remained the same. We are focused on companies with the potential to change the media landscape.”
He said the company had been able to invest in fields directly adjacent to its main businesses – such as non-pure media plays like Roku, which had a stellar initial public offering last year – as well as areas where the corporation was less active, such as music, where it had backed companies such as XM Satellite Radio and Pandora.
The company has also maintained a consistent strategy in respect of the size of deals. Bronfin said in 2013: “Part of the secret of our success has been sticking to our knitting. We have maintained and fine-tuned our strategy throughout the years. For example, we have not gone, like some, for seed-stage deals. Our target initial investment is around $5m, although we have a great deal of flexibility depending on the type, size or stage of deal.”
For a man who last year completed 20 years at Hearst after earlier spending nearly a decade at NBCUniversal, now part of Comcast, such consistency and excellence reap their own rewards.
