Latino activists and entrepreneurs Jess Morales Rocketto and Stephanie Valencia have raised $80 million to launch a new Hispanic media company called Latino Media Network.
Why is this important: This is one of the largest fundraising rounds for a Latina-owned and operated start-up in the United States
- “It’s pretty bold for people like us to do something this big,” Morales Rocketto said in an interview. “Steph and I have been fundraising for a long time, but it’s orders of magnitude bigger than we’ve ever done.”
Driving the news: With the capital, the duo acquired 18 Hispanic radio stations in 10 markets from TelevisaUnivision.
- The deal, valued at $60 million, is one of the largest radio station acquisitions by a Latino-owned and operated company.
- “These 10 markets are some of the densest markets in the country,” Valencia said, referring to markets like Los Angeles, New York, Miami, Houston, Chicago, Dallas, San Antonio, McAllen, Fresno and Las Vegas. “They basically give us access to a third of the Hispanic population of this country.”
- Most of the acquired stations are primarily in Spanish and a few are bilingual. Some of the AM stations are talk radio stations, while others are sports broadcasting affiliates of major professional sports teams. Most FM stations are currently focused on music.
- “This decision follows a formal process, during which TelevisaUnivision met with dozens of potential buyers,” TelevisaUnivision said in a statement.
The startup recruited dozens of high profile Hispanic celebrities, entrepreneurs, media personalities and investors to join his cause.
- The board will include Morales Rocketto and Valencia, as well as radio entrepreneur and investor Tom Castro and social justice activist Henry R. Muñoz III. Castro has bought and sold over 50 radio stations serving the Latino community and serves on the boards of Nielsen and Cumulus Media.
- Lakestar Finance, an investment entity affiliated with Soros Fund Management, is leading the investment, and others including Hollywood actress and entrepreneur Eva Longoria are also investing.
- Maria Elena Salinas, award-winning Univision anchor, and Al Cardenas, former chairman of the Republican Party of Florida and the American Conservative Union, will serve as advisers.
Catch up fast: Valence previously served as special assistant to former President Obama and the White House’s senior deputy director of public engagement.
- Morales Rocketto has worked in various non-profit organizations and is an alumnus of Hillary for America, the AFL-CIO, Obama for America and the Democratic National Committee.
- “Our track record in our community speaks for itself and our ability to achieve this has been tested,” Morales Rocketto said. “But you don’t bring those kinds of people together if it’s not serious.”
Between the lines: Latino Media Network said it would focus on creating and distributing multimedia content across all mediums, with a particular focus on audio to begin with.
- The company plans to expand beyond radio with podcasts and content on YouTube and other digital platforms. It will adopt a bilingual approach, producing and distributing content in Spanish and English on various platforms, such as audio streaming and social media, as well as on its own channels.
- “We want to expand the digital footprint to all of these stations,” Morales Rocketto said. “YouTube is a major entry point for Latinos,” she noted.
By the numbers: Radio has the highest weekly reach among Hispanic adults in the US at 96%, compared to 92% of the total population, per Nielsen. Radio engagement among Hispanics checked dramatically during the pandemic.
- Podcast listening time among American Hispanics jumped 44% in 2021, per Research Edison. More than a third of Latin American adults listen to podcasts every month.
- Hispanics strongly over-index the consumption of information on social networks compared to other minority populations, for example Pew Research Center.
How it works: From a business point of view, the company says it will make money from advertising against radio content and in the future, by syndicating content to other stations.
- As the radio advertising market has recovered from COVID, Valencia said there will be more business opportunities for the company as it expands digitally into cross-platform audio through YouTube podcasting. and other places.
- From a content perspective, Latino Media Network said it would create programming around authoritative news personalities and subject matter experts to help the Latin American community navigate complex topics, such as health care, finance and small business. While much of this content is ad-supported, some programs may be funded through philanthropy, Valencia said.
The big picture: The rise of Latino Media Network and the TelevisaUnivision deal represent the latest big momentum for Hispanic media.
- Two weeks ago, Candle Media, the Blackstone-backed media holding company led by Disney veterans Kevin Mayer and Tom Staggs, acquired Exile Content Studio, one of the fastest growing Hispanic content companies. in the world.
- Last month, a private equity-backed startup bought some of the most influential Spanish-language newspapers in the United States.
- Latinos are the engine of population growth in the United States, but the community has long been treated as a monolith. Latino Media Network said it would focus on creating content that addresses the different cultural and political nuances that impact different types of Latinos.
Bottom line: “Very often our stories have been erased or invisible. In some ways, you wouldn’t know that Latinos will be the main part of the American population in our lifetime,” Valencia said. “We can bring a sense of belonging, influence and power to this community is extremely important.
And after: The company is recruiting a management team, including a CEO, to begin recruiting talent and managing assets owned by TelevisaUnivision.
- The transaction is expected to close by the end of 2022, following regulatory approval in the United States.