Billionaires pile into media outlet streaming video to youth

A youth-focused media company that churns out fast-paced videos has netted another billionaire backer, bringing the total to four of the world’s wealthiest people.

Brut, the six-year-old operation whose name means raw, has added French shipping tycoon Rodolphe Saade as an investor, Brut CEO Guillaume Lacroix said in an interview.

Saade, who began amassing media assets in France in recent months, separately told Bloomberg News while on a trip to China that he acquired a 16% stake.

The CMA CGM chief executive officer and his family are worth $22.4 billion, according to the Bloomberg Billionaires Index.

Saade joins James Murdoch, the younger son of News Corp. founder Rupert Murdoch, French telecom billionaire Xavier Niel and Gucci owner Francois-Henri Pinault as financial backers of Brut.

Brut has now raised about $153 million since it was founded.

The latest funding round, which also brought in digital asset start-up, MoonPay, netted about $43.7 million, Lacroix said. The platform has about 500 million monthly unique viewers worldwide.

Brut is but one example of how ultrawealthy people who made fortunes in other sectors have pivoted to invest in media companies, often in a bid to gain prestige and influence.

Amazon.com founder Jeff Bezos bought the Washington Post a decade ago, while Salesforce CEO Marc Benioff acquired Time magazine more recently.

In Europe, auto-making Agnelli scion John Elkann holds stakes in the Economist and Italian dailies la Repubblica and La Stampa while luxury goods tycoon Bernard Arnault, the world’s richest person, controls influential French newspapers Les Echos and Le Parisien.

Brut’s funding drive comes while controversy swirls around editorial independence at Arnault’s outlets.

Last month, the journalist guild at Les Echos raised questions over the owner’s possible role in its editor in chief’s departure.

This week, Le Parisien’s reporters’ guild criticized coverage of France’s ongoing political crisis over pension reform as being too favorable to President Emmanuel Macron’s government.

Unlike legacy publications, Brut remains a niche provider of news-related content that mostly depends on social media for distribution.

Its headquarters are tucked inside a refurbished former shopping mall on a dowdy street in the French capital.

“We’re trying to build a global champion.” Lacroix said Thursday. “Our fundraising has validated the robustness of our business model.”

The company, self-described as creating “media for new generations,” was co-founded by Lacroix and two French TV executives, with stated values of feminism, ecology, education and minority protection.

Brut aims to be profitable this year, and has already reached that goal in France and India, Lacroix said.

It has expanded into the U.S. and India, and makes money through advertising and deals such as one with retailer Carrefour to create ‘Brut Shop,’ a web-based shopping site.

Initially distributing short video content on Facebook and Twitter, Brut has moved to TikTok and Snapchat and started its own app and website.

The changes in many social media algorithms have made it harder to consistently reach big audiences, leading Brut to adjust its business model.

It launched a Netflix-like paying section in 2021 called ‘BrutX,’ with long-form documentaries.

It didn’t attract as many subscribers as anticipated – fewer than 100,000 instead of the million expected, according to reports.

Brut gained wider notoriety in France with its live coverage of the 2018 ‘Yellow Vests’ street protests and interviews with Macron.

The French president used the platform to try to connect with young people in 2020 and on the campaign trail two years later.

Brut’s TikTok page documenting protests in France over pension reform has drawn tens of thousands of simultaneous viewers in recent weeks.

This included live coverage of police opposing demonstrators and piles of garbage being set on fire.

Saade’s investment in Brut makes good on his signaled ambition to amass more media assets.

Last year he bought La Provence, a regional newspaper based in the southern city of Marseille where his family’s closely held container liner has its headquarters. He has acquired about a 10% stake in French broadcaster M6.

“I believe Brut offers quite a lot of good solutions and that is why we have decided to invest 16% in this media,” Saade said in China, where he was part of a business delegation accompanying Macron on a state visit.

Niel was among the first investors in Brut via his personal holding NJJ. He has a net worth of $7.7 billion, according to the Bloomberg wealth index.

The investment in Brut is part of Murdoch’s pivot after resigning from News Corp.’s board in 2020, citing disagreements over news judgment and strategy.

He founded and heads a private investment company called Lupa Systems.

To Lacroix, Brut’s ownership by some 20 investors provides a way to preserve independence.

“Brut media is totally independent of its shareholders editorially,” he said. “We have a shareholder environment that respects this independence and would never take any measures to threaten this.”