Whatnot, a livestream shopping platform, completed a Series E round at a $4.9B valuation.

TARGET: Whatnot

Overview

• Launched 2019 in LA

• Founded by Grant LaFontaine (CEO), Logan Head (CTO)

• Allows users to sell collectible items such as cards, comics, sneakers

• Collects fees from platform transactions

• 600 employees

• Privately owned

Product Highlights

• Differentiates itself from competitors focused on fashion and beauty products

• Started w/ sports trading cards, action figures, comic books, and memorabilia — expanded to accessories, clothing, electronics, live plants

• Key feature is “sudden death” auctions, where last bidder wins item

• Flash sales enable time-sensitive sale discounts

• Buyers can redeem loyalty rewards for achievements

Financial Highlights

• $3B GMV in 2024, doubled YoY

Capital Markets History

• $746M total raised since inception

• Previous Funding Rounds:

  • Series D (2022): $260M, valuation at $3.7B

  • Series C (2021): $150M, valuation at $1.5B

DEAL DETAILS 

Overview

• $265M Series E round at $4.97B valuation

• Lead Investors: Greycroft, DST Global, Avra

• Others: Lightspeed Venture Partners, Durable Capital Partners, Andreessen Horowitz.

Use of Funds

• Further innovate in collectibles and niche items

• Expand into more categorieslike art, golf, vinyl

• New seller tools to simplify inventory mgmt and orders

• Expand into new markets such as Australia and new Euro countries

• Enhance customer experience

• Buy back $72M of shares from employees

What Else I find interesting…

• Tiktok ban will accelerate Whatnot revene and user growth. Likely fundraise was strategically done right before ban, where many TikTok Shop users are fleeing to alternative platforms, to take advantage of landgrab moment

• Whatnot is till significantly smaller than eBay and TikTok Shop

• Many livestream and social commerce companies from western markets have shut down or gone through fire sales since 2022 (e.g. Popshoplive, Superordinary). This market downturn a period of large investment into the space starting in 2019. Key challenges that faced the industry included higher than expected UA costs at scale, low customer adoption behavior relative to Chinese counterparts, low customer willingness to spend, undifferentated business models, lack of support infrastructure, limited access to brands and product inventory, and strong competition from incumbent social platforms like Meta, Google, and TikTok (RockWater covered a lot of this here, with many more on our blog if you search livestream shopping)

TLDR: Brat Buys Electric Monster

Brat TV, a digital content studio, acquired Electric Monster for an undisclosed sum to increase scale of its YouTube channel business.

NOTE: Electric Monster was a RockWater client. We’re limited in what we can share below due to our NDA.

TARGET: Electric Monster

Overview

• Diversified digital media business

• Founded in 2021 by Matt Gielen

• Also has Little Monster, a YouTube strategy and advisory firm

• Based in LA

• 69 employees on LinkedIn

Company Highlights

• Over 33M YouTube subscribers

• Tentpole franchises incl React, People vs. Food, Kids Learning Tube

Capital Markets History

• $14M total raised

• Main investor was Metropolitan Partners Grop

• Other investors include Heroic Ventures, Together Ventures Capital

• Acquired React Media in 2021, along with 5 other YouTube properties

BUYER: BRAT TV

Overview

• Digital entertainment studio

• Focus on Gen Z and Gen Alpha audiences

• Founded 2016 by Rob Fishman, Darren Lachtman

• 110 employees on LinkedIn

• Based in LA, NY

Business Units

• YouTube channal network

• Influencer Marketing (Beeline Talent)

• Now Playing (YouTube network to support film / TV studio library marketing)

• Podcast network (Past Your Bedtime)

Company Highlights

• 5M+ YouTube subs

• Tentpole series incl Chicken Girls, Attaway General

Capital Markets History

• Acquired Crypt TV in 2024 (our analysis here)

• Acquired ecom platform Jemi in 2023

• $45M raised from Anchorage Capital, Lerer Hippeau, Advancit, BoxGroup, Thirty Five Ventures

DEAL DETAILS

Overview

• Terms undisclosed

Strategic Rationale

• More scale on YouTube and other social platforms

• Increase and refine programming across YouTube network

• More social inventory for brand partnerships

• Expand to new audiences outside Gen Z and Alpha

• Expand reach to new Little Monster agency clients

• Consolidate back office, realize cost synergies

Post Deal Ops

• Brat will rebrand to ZATV

• Brat CEO Rob Fishman to run combined ops

• EM CFO Ian Haft will serve as group CFO

• EM’s Tim Jablonski will continue running Little Monster agency division

What Else I find interesting… 

Reminder that I’m keeping this short since RockWater was an advisor to Electric Monster, and we’re under NDA.

• Expect a lot more YouTube and social publisher M&A going forward. This builds upon recent YouTube deals like the Hot Ones sale to the Soros-led buyer consortium (our analysis), and the sale of Complex to NTWRK (our analysis)

• Also worth highlighting that a digital agency was included in the deal. There’s been a ton of digital agency M&A, which we’ve covered extensively on our deal blog. We’re seeing more digital agencies attached to social publisher businesses, since they help activat brand dollars outside the O&O media of the parent co. We’re actually bringing one of these businesses to market for a sale over the next couple of months, stay tuned…