In September of 2019, VENN closed a $17M USD seed funding round led by BITKRAFT, with participation from Blizzard co-founder Mike Morhaime, Riot Games co-founder Marc Merrill, Twitch co-founder Kevin Lin, and Blizzard’s former Head of Global Sports Amy Morhaime. Months after it officially launched in August of 2020, VENN raised an additional $26M in Series A investment round co-led by BITKRAFT Ventures and Nexstar Media Group. With funding in hand and a line-up of on-air talent, VENN set out to produce a slate of shows and build its network audience, but a number of challenges including a global pandemic truncated the company’s growth efforts in 2020.
In a recent interview with The Esports Observer, VENN co-founder and CO-CEO Ariel Horn spoke at length about the shortcomings and triumphs of the network’s first six months of operation. Horn described what he envisioned for the network: a place where they would and create the kind of crossover content that he spent years helping to make while at Riot Games; content with pop culture relevance that resonated with fans like what the company created with its League of Legends–themed virtual k-pop girl group, K/DA.
“I came from my years at Riot working on the biggest esports events in history, and so I had a chance to really observe the crossover of the lore of the game, the sense of validation that these gamers had for their specific title, and how you could elevate the pop culture relevance of it and at the same time (whether it’s with warriors or magic dragons), pull the characters out of the game and do things like making pop stars out of them.”
Horn recalled that in the early days of VENN’s launch, advertisers appreciated what he described as “high-gloss, high-production value, studio-based gaming content and news” that VENN was creating, which helped the company land early deals with Subway, adidas, Geico, American Eagle, and others.
Another positive for VENN in its early days, Horn said, were the multiple distribution deals with linear platforms that it signed: “We were able to quickly get distribution across virtually every connected smart TV, the Roku’s of the world, and now Rakuten globally. Building that linear distribution pretty fast was another thing that I think was surprisingly good for us.”
But VENN, like a lot of other businesses in 2020, had to contend with the ramifications and limitations of a global pandemic that the governments of the world struggled to contain. Operating a network that produces content in-studio and was likely to lean into important in-person events such as esports competitions, gaming festivals, and industry trade events proved to be a challenge.
“The pandemic has obviously affected everyone pretty much equally, us included,” Horn said. “We’ve had to spend a lot more [money] than we expected because of testing, COVID-19 protocols, keeping people separate and opening up our studio space. We had to spread out a lot more than we ever would have expected just to get the distance between our employees while we were in edit rooms and control rooms during production – so that has proven to be pretty challenging.”
While VENN is happy with its linear platform numbers (which it did not disclose), the company has learned a few lessons about the kind of content it has created thus far and how it has not resonated as well as it could have with core gaming audiences found on Twitch and YouTube.
“I would say that the overarching sense is that there have been successful moments, like when we were teaming up with Austin Show on Dare Package, we had over 30K concurrent viewers on Twitch. And so we know when we use the platform the right way we can generate big numbers. We’ve had enormous success with Christina Costanza on Snapchat, for example, getting viewers to watch her short-form. We’ve been focusing a lot more on esports with FACECHECK, and we’re seeing good numbers on YouTube, but overall, no, we are not satisfied so far with our YouTube numbers, or our short-form numbers. I think that’s why we need to focus on creating content that’s specifically meant for short-form platforms because it’s so difficult to produce for long-form. “
Horn learned that focusing on creating long-form content was a lot more expensive, required a lot more studio production time, and wasn’t always resonating with viewers. “Really, what we learned is that what we want to be doing going forward is focusing on short-form success, audience resonance, audience growth, and audience engagement through the short-form platforms.”
VENN has also taken a bit of time to think about how it can calibrate its content for 2021 and beyond, to broaden its appeal. One of the things the company learned after doing some focus group testing on its audience is that “they are overwhelmingly asking for more esports, more gaming talk, game reviews, and spicy kinds of takes” on emerging topics. Horn acknowledges that it is going to take time to establish VENN in the market, build awareness, and cater to its target audience.
VENN is now recalibrating how it creates and distributes content on platforms such as Twitch and YouTube and short-form video platforms such as TikTok; the company announced a slate of new programming initiatives that includes a talk show starring OpTic Chicago CEO Hector “H3CZ” Rodriguez; a new partnership with Fan Controlled Football, a licensing deal for League of Legends talk show FACECHECK, and more collaboration with tournament organizer BLAST.
In addition, the company has changed its focus from long-form to short-form content, and even some of the programming it already has will be cut up into smaller fragments for distribution across its various channels. More important, VENN will focus on three core groups of content: hardcore gaming, esports, and the crossover cultural content Horn was a part of during his time at Riot.
It is also in early discussions to syndicate content on Linear TV, and create shows for streaming networks:
“We actually have pretty mature discussions going on with major traditional entertainment production companies, some of the biggest in the industry, to take our formats and potentially co-produce them for TV and window them on “the Neflixes” of the world. As we grow this brand from scratch to do a combination of owned and operated growth of our own IP, licensing other content like Face Check, and partnering with other great creators like BLAST and other traditional content creators to get our content externally windowed. I think all those things should hopefully bring that energy back home to our channels.”
Despite the challenges of its first six months, Horn is optimistic about VENN’s future going forward and its ability to adjust and grow through a combination of new deals, content, and distribution on traditional and emerging platforms.
“The thing for me is I just want to keep learning, adjusting, and being a pure startup, navigating this market and continuing to refine our focus,” Horn said.. “I’m pretty excited about the partnerships we have this year. My hope is that it is going to be a really great year for VENN and that we’ll look back and see that growth point starting from where we focused on short-form, we had some great insight to increase our focus around core gaming and esports, and made some key deals that were critical. As the lifestyle of gaming continues to come further into the mainstream, we’ll be here and positioned with great distribution, partners, and a base of a TV network that will continue to grow over time. “
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