Levinsohn, Miller Linking With SV VC ComVentures

Former Fox Interactive head Ross Levinsohn and former AOL CEO Jon Miller, who spent the fall trying to launch a digital media rollup with the backing of private equity group General Atlantic, have moved on. They’re now joining up with Palo Alto-based VC firm ComVentures, or at least parts of it — the two will link up with of three of ComVentures partners, and their $1 billion plus-portfolio. Levinsohn and Miller’s new company gets their old company’s name — Velocity Interactive Group.

Confused? It doesn’t get a lot clearer. Levinsohn and Miller say that technically, they’re continuing with their jobs advising General Atlantic, but don’t spell out why they tabled their plans to launch a rollup fund. We also can’t shed much light on what’s become of two ComVentures partners who are no longer with the company.

Levinsohn and Miller generated a lot of buzz over the past few months — first when they looked to have launched a deep-pocketed M&A effort, and later, as they came close but never acquired anything with GA. Now the two say that they’ve made deals, after all — but that they were done alongside ComVentures: Indian TV companies NDTV Networks and IndiaTV; Fabrik, a media storage company; Doppleganger, a Second Life-like “virtual world”; and Mixercast, which has something to do with “creation, publication and distribution of all types of rich-media expression.”

Next up: Levinsohn says the new company will look to invest in more digital media deals, up to the $20 million to $30 million range; he says they’re in the midst of 2 to 4 deals that could close by February.

Maybe. “It’s getting a little more irrational, and I think 2008 is going to be worse. There is a level of fear and desperation out there from buyers and it is easier to buy than to create.” says Levinsohn, who’s best known as the guy who helped Rupert Murdoch buy MySpace for a song in 2005. “What’s really expensive are companies with very little revenue and no earnings, but lots of users. Somewhat affordable are companies with decent revenue, some earnings, but smaller user growth.”

Press release excerpts

Velocity Interactive Group, a new global digital media and communications investment firm, was unveiled today
as a result of a merger between Velocity, the firm founded by Ross Levinsohn and Jonathan Miller, and ComVentures and its seasoned venture investors, David Britts, Keyur Patel and Roland Van der Meer.  Over the past year, the five have worked together on a series of investments and this evolution marks the start of a formalized partnership between the two firms.  The firm also announced a series of investments it has finalised.

Velocity Interactive Group also announced today several of the investments in the U.S. and India that it has been working on for the past year. In India, the firm has invested in two of the most prolific media concerns in the rapidly expanding market:

·      NDTV Networks is India’s first and largest private producer of current affairs and entertainment content both online and on television.
·      IndiaTV is a leading Hindi language media company headquartered just outside of Delhi, India. India TV has a unique repertoire of programming that includes prime time nightly news, current affairs, consumer awareness, crime reports and personal health.

In the U.S., Velocity has finalised investments with three dynamic properties:

·      Fabrik is the fastest growing company in the explosive category of digital media management and storage. The company has grown revenue from zero  to more than $100 million over the past 18 months.  Fabrik enables consumers to efficiently manage their personal digital media. Its offerings are designed for video and photo enthusiasts, bloggers, social networkers, creative professionals and anyone else who revels in digital content.
·      Doppelganger is a social entertainment company offering virtual world experiences for today’s youth around music, fashion and entertainment. Doppelganger creates an immersive and connected virtual environment that reflects and amplifies the youth demographics’ real-world interests: music, pop culture, fashion, celebrities, self-expression, community, and social networking.
·      Mixercast is currently operating in stealth mode. The company is developing a service that allows the creation, publication and distribution of all types of rich-media expression and enables users to easily create mixed-media objects – video, audio, image and text.  In addition, Mixercast utilizes social networking concepts to distribute, track utilization and allow efficient publishing, syndication and distribution of these media feeds. Mixercast is focused on content and its efficient delivery.

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