Caught in a cash squeeze, emerging media companies are borrowing against their receivables to gain working capital. CFO staff writer David Rosenbaum outlines one media company’s odyssey in securing financing to expand its business.
Rosenbaum writes:
Remember lonelygirl15? lonelygirl15 appeared on YouTube in June 2006 — and was an instant sensation.
A teenager, resting her chin on her knee, stares into the camera and, calling herself Bree, announces that she’s 16. After a few giggles, she says her town is “really, really boring.” She confesses to being “a dork.” Then she sticks her tongue out and begins making faces.
The video ran for a minute and a half and has now been viewed more than 4.5 million times. In retrospect, it announced the dawning of the age of online video, illustrating both its democratizing and viral power.
It was also a fake.
Rather than a spontaneous expression of teen spirit, the video was cast, scripted, and produced by Miles Beckett and Greg Goodfried, who soon after co-founded EQAL, a digital-content-creation studio that in 2009 began shifting to a celebrity-driven social-video platform. It was acquired last September for a rumored $15 million–$25 million by Everyday Health, an online health-information provider with more than two dozen websites.
Read the entire CFO.com article.