Venture Capital Fund Eyes Latino, Asian Media Properties

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Newspapers and other traditional media may be taking a hit these days, but two local venture capital firms are prowling for acquisitions, particularly in the emerging Hispanic and Asian media markets.


Daniel Villanueva, managing partner of Pasadena-based Fontis Capital LLP, and Renee LaBran, a partner at Santa Monica-based Rustic Canyon Partners, have teamed up to form a new venture capital fund that will invest in media, business services and consumer product companies.


So far, they’ve raised $70 million as part of a $150 million commitment they are seeking from investors that include the California Public Employees’ Retirement System, the California State Teachers’ Retirement System, Bank of America Corp., the New Mexico Investment Council and Wells Fargo & Co.


LaBran, a former executive at the Los Angeles Times, and Villanueva, president of the Los Angeles Galaxy soccer team and a former executive at Univision Communications Inc.’s KTVW-TV (Channel 3) in Phoenix, joined forces after hearing about each other from potential investors.


“We started talking to investors about starting a specialty fund and they said there was another group with the same focus,” LaBran said, noting that Fontis brings to the table experience in radio and the Hispanic market, while Rustic Canyon’s expertise leans toward print, cable and the Internet.


The fund will be open to investments in a wide range of media properties, from radio and television to print, Internet and cable. Each investment is projected to range from $5 million to $10 million.


Villanueva’s father, Danny Villanueva Sr., is a former chairman at Bastion Capital and a consultant at Fontis. But he made a bigger name for himself as a place kicker with the Los Angeles Rams and Dallas Cowboys in the 1970s.



Adults Only


Amp’d Mobile Inc., the upstart Los Angeles-based mobile phone content provider, is planning to offer adult content on its network in an effort to capture the 18-35 market. But users will have to wait a while.


The company, which plans to launch this month, wants to offer adult content from LFP Inc.’s Hustler magazine and other sources. That will not happen, however, until U.S. cell carriers figure out a way to enact reliable age-verification controls.


Currently, no U.S. cell carriers allow users to access anything more than tame bikini-type shots, although age-verification talks are underway at the Cellular Telecommunications and Internet Association.


Meantime, adult content distributors such as Denver, Colo.-based Brickhouse Mobile are largely limited to overseas cell phone markets. Still, Brickhouse expects mobile phones, given their widespread use and advances in handset and video quality, will help drive demand for premium adult content.


“There are several billion cellular handsets out there,” said L.R. Clinton Fayling, president of Brickhouse. “All of those could be potential customers.”



Latino Meters


Last year, Latino advocacy groups decried the implementation of Nielsen Media Research’s Local People Meters to measure television viewership, saying that the devices would undercount minority viewers.


The meters measure audience preferences electronically by recording information about shows they watch. After they were installed in New York homes last year, Nielsen reported a sharp decrease in viewership for some television shows that featured minorities, leading to concern among network affiliates and minority groups that the system was flawed.


But after a year, Nielsen says that the devices may have had the opposite effect, at least in the Los Angeles market.


Some 800 meters have been installed in L.A.-area homes and the company now says that 32.4 percent of those are in Hispanic households. That’s more than the 31.5 percent of area households that are identified as Hispanic, according to Karen Gyimesi, Nielsen’s vice president of communications.


(The sample also reflected 9.2 percent African American households, while the Los Angeles market is 8.8 percent African American. Nielsen tries to ensure its sample is within two points of demographic data.)


The meters could be part of the reason why KMEX-TV (Channel 34), the local Univision affiliate, grabbed the top spot in October’s ratings period, although the station’s ratings have been on the rise in general as Latino viewership increases.


Another factor: the meters don’t involve the use of a Nielsen diary, which required viewers to keep a written record of shows they watched in 15-minute increments before sending the information back to Nielsen.


Under the diary method, some Latin households may have faced language barriers in reporting the information and keeping participants. “It’s much easier to recruit participants in person and attach a box to their TV than it is to blindly mail out a diary and hope people participate,” Gyimesi said.



*Staff reporter Anne Riley-Katz can be reached at (323) 549-5225, ext. 230, or at

[email protected]

. Staff reporter Kate Berry contributed to this column.

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