Comedy website Funny or Die Inc. is laughing all the way to the bank.

AMC Networks Inc. announced last week that it had acquired a minority stake in the Hollywood company, a deal that comes on the heels of multiple cost-cutting moves over the last few months at the site co-founded by Will Ferrell and Adam McKay.

The investment allows AMC – which owns and operates comedy network IFC, among other channels – to leverage Funny or Die’s popularity with millennial viewers on digital and social platforms. Meanwhile, Funny or Die’s content could potentially benefit from IFC’s strength in the traditional TV space.

“We’re doubling back down on comedy content and the creators that got us here in the first place,” said Mike Farah, Funny or Die’s chief executive. “This investment really helps accelerate us. We’ll work with IFC to evolve our business model to add value for them, and for them to add value to us.”

Terms of the deal were not disclosed.

While the media industry has been rife with consolidation, Lindsay Conner, partner and co-chair of the entertainment and media group at Manatt Phelps & Phillips in West Los Angeles, said he doesn’t view the AMC investment as a part of that trend since the network has only taken a minority stake.

However, the deal does represent a broader industry shift in which legacy media companies work with digital startups in an effort to reach the coveted millennial audience, he explained.

“Traditional networks are looking to reach millennials because they represent the future – not the present,” said Conner. “Meanwhile, new digital organizations have great content, but haven’t found ways to monetize, need a stronger financial base, and a better way to distribute globally.”

Funny or Die, which produces video shorts such as the Emmy-nominated “Between Two Ferns” with host Zach Galifianakis, will continue to operate independently. Farah said the capital infusion will allow the company to hire additional content creators and work with other distributors, networks, and studios, such as HBO and Hulu, while retaining its own ad sales team.

IFC President Jennifer Caserta will join the Funny or Die board as part of the deal.

The investment comes three months after Funny or Die laid off about 30 percent of its staff and closed its San Mateo office. The company explored a potential sale last year, with a reported $198 million acquisition by Viacom Inc.’s MTV falling through. Farah said Time Warner’s Turner Broadcasting, which ended its three-year sales partnership with the company last year, retains a minority stake.

Launched in 2007 by Ferrell, McKay, and Chris Henchy, Funny or Die’s videos reach a monthly global audience of more than 66 million, according to the company.

For reprint and licensing requests for this article, CLICK HERE.