Scott Levine, Managing Director of Time Warner Investments, spoke to digital media and technology leaders on a panel titled “Investing for Growth” at the Siemer Summit in Santa Monica, CA, last week (pictured above).
The session featured Andy Donner, Investment Director of Unilever Ventures, Stephen Royer, President and CEO of Shamrock Capital Advisors, Jeff Stibel, Chairman, President and CEO of The Dun & Bradstreet Credibility Corp, Mike Jones, CEO of Science, and John Kim, Managing Director, H.I.G. Growth Partners.
Key themes the panelists discussed included issues with secondary purchases of shares in both venture capital and growth equity rounds, as well as how startups should go about finding the right investor. Levine recommends that entrepreneurs first research potential VCs before any pitch, to make sure they invest in the right sector and stage that matches with the startup. He also noted that entrepreneurs need to deliver a succinct story to potential investors, describing their offering, the potential size of the market opportunity, and what differentiates their startup from the competition.
The value that strategic investors can provide entrepreneurs, besides its cash component, was another topic for discussion. Levine and Donner explained the benefits of the strategic investor’s focused industry knowledge and expertise. Strategic investors can also provide valuable introductions & access to the operators across the parent company’s divisions, as well as introductions to other companies in the sector, which could potentially enable further business relationships.
Time Warner Investments group specifically looks for opportunities in early to mid-stage companies that generate strategic value for the company’s businesses. Strategic goals include the delivery of new services, enhancement of an existing product, entry or expansion into a key strategic market, completion of a strategic partnership, and critical research and development.
Most of the Time Warner Investments portfolio companies have developed one or more business partnerships directly with the company’s divisions. One example is when Time Warner invested in Bluefin Labs in 2012. The startup worked with Turner and HBO to provide social media sentiment and research for their TV assets. Bluefin Labs was sold to Twitter the following year.