NNN Raises $15MM on Building Communities, Not Hits

Next New Networks, which has some good stuff and some bad stuff (mostly good), just raised $15 million from Goldman Sachs and Velocity Interactive Group.  They’re leading the development of the next generation entertainment studio.  I say this with due respect to the other visionaries who invest in and create web entertainment.

Rafit Ali at PaidContent is skeptical of NNN’s "hits driven model" but is this model really hits driven?  I don’t see it that way. NNN is driven by discovering and serving modest sized communities with common interests – amateur filmmakers (IndyMogul), amateur fashionistas (Threadbanger), car freaks (VOD Cars, Fast Lane Daily), etc.

We all know how it works: Hollywood products are so often stale because quality media creation requires experimentation, and experimenting with Hollywood budgets is too risky for most studios to stomach.  It’s a shitty business. 

On the web, however – where low barriers to entry allow a successful show to sustain a budget of about one-half of one percent of the lowest imaginable studio budget (i.e. Ze Frank

, Ask a Ninja, Rocketboom) – experimentation is key.

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The risk that so scares Hollywood executives is amortized: new media studios like NNN will thrive by finding and serving modest sized audiences, not by pandering to the lowest common denominator (aka creating hits), but by creating and experimenting.

I expect a more predictive development model to emerge from within internet studios as they continue to experiment, but so far, I’m pretty impressed. I applaud Next New Networks for paving the way towards a fair and efficient professional production model that looks like a winning business.

Congratulations to Next New Networks for their recent successful fundraising effort, and for being a driving force behind this growing industry.