Why Supermodel Tyra Banks' Demand Media Deal Makes Her A Supermogul

Tyra Banks

Photo: Wikipedia

Celebrities love fashion, fashion loves celebrities, and as we’ve previously mentioned celeb supported online fashion startups are becoming the new celebrity clothing line.Demand Media announced a partnership with Tyra Banks last June to launch an “interactive web property, an engaging online video series and unique mobile applications” that “closely supporting her core mission to expand the definition of beauty.”

That partnership also made Banks a shareholder in Demand Media, who recently had a successful IPO. The web property portion of the arrangement is scheduled for a March 15th launch. Already, there’s a Nowness style pre-launch – obviously more mass market than high end – with a daily question available to people who connect to the site with their Facebook account.

Perhaps more interesting than the site though is the deal itself, which could make Banks one of the highest netting online fashion startup entrepreneurs. While Kim Kardashian probably does have some role in choosing which shoes are available on ShoeDazzle, and it’s not beyond belief that Kate Bosworth gives the OK on some of the selections on JewelMint, there’s nothing in SEC filings to suggest either is a significant shareholder.

While Banks’ 375,000 warrants to buy Demand Media shares at $12* don’t make her the biggest financial winner in the Demand IPO they would net her company more than $4.7 million at Demand’s current share price of $24.55. That’s with nothing even launched.

Currently enrolled in classes at Harvard Business School, Banks has quite a bit of media experience, of course. So it makes sense that she’ll net more for her endorsement than Kardashian or Bosworth. It’s probably even more of a win for Demand, who insists they aren’t a content farm, but are still struggling with a perception that the machine generated topics used to spur writers and take advantage of easy to target search terms result in low-quality pieces, bordering on spam.

America’s Next Top Model and the now defunct Tyra show may not be Masterpiece theatre when it comes to television content, but they’re both extremely successful: the former has spawned 20 international editions, and the latter earned two daytime Emmys. If nothing else, Banks has proven herself to be effective at making fashion and style topics entertaining for a mass audience. Even if Demand’s bots can do as good a job at selecting those topics, it certainly can’t hurt to attach a human face to a project where the hope is that the audience is there not because they’re searching for something, but because they already know what they’re looking for.

Build that, and there’s probably a good chance the search spiders will come back.

Supermodel Tyra Banks’ Demand Media Deal Makes Her a Supermogul by YM Ousley originally appeared on Signature9.

*Post updated to reflect changes in number of warrants owned by Banks’ company, BEI, from 750,000 to 375,000 and an excercise price change from $6 to $12 as shown in a recent SEC filing by Demand Media.

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