The ‘meme’ company, which was acquired by Warner Music at $ 85 million, has 40 million subscribers, is viewed more than 3 billion times a month.

One of the biggest music acquisitions this year was the Warner Music Group (WMG) acquisition of IMGN Media on August 14. However, the special thing is that this deal has nothing to do with music.

IMGN Media is a company famous for creating memes (cultural icons or an idea that goes viral on the internet) and viral videos on Instagram, Snapchat and TikTok.

IMGN is a company specializing in “processing” meme and viral video on social networks.

The value of the deal also surprised many people: $ 85 million. This is a large amount of money but does not affect the financial capacity of WMG because they own about 532 million USD in cash in the bank, as of the end of June 2020.

Even so, the IMGN acquisition is also a significant bet for WMG because with that money, they can invest in highly regarded artists or writers and immediately add value and marketing. part of the corporation.

So why did WMG spend such a large amount of money to buy IMGN, a company that doesn’t own any music rights?

One of the major causes is the problem of data capture, a better understanding of the habits and trends of teen audiences. According to the IMGN website, the company’s channels now have more than 40 million subscribers / followers and are viewed more than 3 billion times per month. Up to 80% of their audience are Generation Z and younger.

IMGN used to be called Comedy.com. It was renamed in 2017 to show diversification beyond humor based content, although much of its content is still designed to be amusing. That is certainly true of IMGN’s most popular channel, Daquan with more than 15 million followers on Instagram.

The Daquan page has more than 15 million followers on Instagram.

“IMGN has tackled one of the toughest challenges facing brands and publishers today: the traditional conflict between content and audience. IMGN’s channels connect themselves. for a young audience, like how viewers interact with their friends. ”

IMGN’s understanding of that audience not only brings popularity but also brings them high profits. The company’s total annual sales have quadrupled in 2018.

IMGN’s main source of income comes from running social media campaigns for major corporations like Microsoft, Electronic Arts and Netflix.For example, for Netflix, an IMGN campaign two years ago was seen more than 16 million times in just 5 social media posts.

IMGN founder Barak Shragai says that while the majority of the company’s content seems to be lack of seriousness, they follow strict editorial standards as well as a deep understanding of the audience. The three main rules that IMGNs follow to achieve success are relevance, relevance, and focus. Shragai further explains IMGN’s commercial customers: “Brands must be willing to take risks when interacting in a more relaxed way.”

IMGN founder, Barak Shragai.

As for WMG, the acquisition of IMGN promises to help improve the interoperability and attention of younger generations on social networks.

In fact, the capabilities of IMGN have impressed many other “billion dollar” empires. According to TechCrunch, Snapchat owner Snap Inc considered an IMGN acquisition for about $ 180 million, while TikTok also considered it for $ 150 million.

Under WMG’s ownership, IMGN is still completely free to continue working with third-party partners. This creates a new source of revenue for WMG itself, helping to offset the 85 million USD they spent earlier.

Another important advantage for Warner of owning a company with truly dominant social media channels is reducing the corporation’s reliance on individual social media KOLs.