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Why Podcast Startups Are Booming In LA
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A few stories arrived recently demonstrating the continued strength of Los Angeles’ podcasting industry. Spotify, of course, unveiled its massive “Pod City” production hub in the Arts District in Downtown L.A. last December. HeadGum Studios expanded its operations back in 2020, and earlier this year, L.A.-based ad platform Gumball raised $10 million in Series A funding that it will put toward a new system making it easier for sponsors to place host-read ads on popular series. Then this week, L.A.-based PodcastOne beefed up its line-up of sports personalities, adding former baseball pro Nick Swisher, NBA vet Bobby Portis and former Jacksonville Jaguar Chris Howard to its team.

PodcastOne is the podcasting division of the Beverly Hills-based livestreaming company LiveOne, which was acquired back in 2020 for around $18.1 million and spun off into a separate entity earlier this summer. It’s now valued at approximately $60 million, according to internal estimates. With just 42 staffers, PodcastOne distributes a staggering 350 weekly podcast episodes, many of them fronted by notable media figures and radio and TV personalities, such as Adam Carolla and “Bachelorette” veteran Kaitlyn Bristowe.

Also this week, Crooked Media – the political podcasting outfit from “Pod Save America” mainstays Jon Lovett, Jon Favreau (not the film director!) and Tommy Vietor – announced an undisclosed amount of new funding from billionaire George Soros’ investment firm, which will take a minority stake in the company. (Lovett, Favreau and Vietor will retain their majority control.) Up until now, the co-founders ran the company themselves in addition to producing their popular series, but as part of the new deal, they’re bringing in former Vice Media Group Legal Officer Luncinda Treat to be Crooked’s first-ever CEO. Treat will relocate from New York to Los Angeles to run the podcasting outfit, which currently boasts more than 30 shows, and has more than 88 full-time employees. Meanwhile, podcasting platform Spotify has been steadily acquiring smaller outlets–such as Gimlet, Parcast and The Ringer.

Advertising obviously tells part of the story here.

In 2021, U.S. podcast revenue rose to $1.4 billion, passing the $1 billion mark for the first time and increasing returns year over year by 72%. It might be hard to keep that level of momentum going over the long term. Last year, after all, people were returning to work and commuting en masse after a year of pandemic-related lockdowns. Nonetheless, analysts looked at those extremely healthy numbers and still saw significant more growth on the horizon. All indications are that podcasts could exceed $2 billion this year and hit $4 billion in yearly revenue by 2024, and companies are desperate to tap into the global earning potential of these broadcasts.

But this isn’t just about selling you Blue Apron subscriptions and Casper Mattresses, although it is definitely about selling you both of those things. Podcasts have also become an important source for generating new media content, beyond just streams featured on podcasting platforms. Crooked, for example, has a deal with Hulu to adapt its podcast “Wind of Change”–about the CIA’s involvement in producing the band Scorpion’s 1990 ballad of the same title–into a TV series.

Having a reliable ongoing feed of new story concepts that are not just produced but tested with real-time audiences could prove valuable to a range of media companies. Amazon’s 2020 acquisition of Wondery–the outlet behind the breakout true-crime podcast “Dirty John” among others–could become the first of many such deals. – Lon Harris

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What We’re Reading...

- Amazon Studios teams up with Edward James Olmos’ Latino Film Institute, and will serve as the exclusive sponsor for its 2022-2023 Youth Cinema Project Alumni Program.

- Gaming studio Take-Two Interactive partners with the Gay Gaming Professionals group on a series of five PSAs about diversity in the industry.

- L.A. County partners with PowerFlex to add 40 Level 2 EV charging stations and thee DC Fast Chargers to the parking lot at the Walt Disney Concert Hall.

- Xembly, maker of a suite of AI-based production tools, raises $15 million.

- SpaceX has reportedly been bidding against itself for NASA contracts.


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