Zealot Networks Acquires ViralNova

Viralnova ZealotZealot Networks acquired viral news site ViralNova Thursday, citing its audience and underlying technology.

The deal valued ViralNova close to $100 million, according to The Wall Street Journal. Zealot Networks declined to name the exact figure, but said the acquisition is the biggest of the 15 it’s made so far.

Formed 18 months ago by the ex-CEO of Maker Studios Danny Zappin, Zealot Networks has since cobbled together a group of ad agencies, event companies, a branded content studio and now – in ViralNova – a digital publisher.

The idea is to bring  ViralNova’s expertise in creating and distributing sharable content to the agencies, brands and personalities with whom Zealot Networks works.

“Our challenge [with ViralNova] is how to evolve the content, expand the audience and apply the technology in different categories and areas,” said Zealot Networks’ chief strategy officer, Conn Fishburn. Zealot Networks, he said, hopes to create a vertically integrated digital media company.

“There are definitely verticalized things, but there is a horizontal layer that goes across to make it sing,” he added.

From an advertising perspective, Zealot Networks hopes to help clients “weave themselves into people’s daily lives” via events, content marketing, influencers and an underlying technology that finds “those relevant moments throughout the day.”

The addition of content technology to a larger portfolio recalls Relativity Media’s acquisition of a minority stake in content platform Say Media. Relativity, which has wide holdings in media and entertainment, wanted better capabilities around content creation and distribution.

Say Media wasn’t in the best financial circumstances, and some may say the same of ViralNova, though the publisher claims it has been profitable since launch and will post $35 million in revenue this year.

But traffic for viral news sites is volatile. ViralNova attracted 4.3 million unique visitors in June 2014, 37.1 million unique visitors last January and 17.6 million uniques in May. It also relies heavily on social referrals and paid traffic via content recommendation platforms.

The underlying technology won Zealot Networks over.

“ViralNova stood out from the beginning because they have a savvy, data-driven mindset in the types of content they produce,” Fishburn said. “It’s been tested and proven that it will click. That’s built into the core technology, and that’s something we’re excited to roll out to other media properties in our portfolio.”

ViralNova has thought about cashing out before. Founder Scott DeLong put the publication up for sale in January 2014, just six months after it was founded, only to take it off the market, hire Sean Beckner as CEO and build out its content and engineering teams.

Now the question is whether ViralNova’s acquisition will spur other deals among its competitors like PlayBuzz, Upworthy and Distractify. Those companies have also raised money to fund viral news. Meanwhile the original viral publisher – BuzzFeed – is valued at more than a billion dollars.

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