Discovery Networks have acquired How Stuff Works for $250 million.
According to a Wall Street Journal report, Discovery plans to use the site “as the cornerstone of an effort to bring its vast library of video content to the Web.” Discovery previously acquired environmentally focused blog TreeHugger.com for $10 million in August.
How Stuff Works is a long standing provider of edutainment content on the web. The site was founded in 1998 by former North Carolina State University professor Marshall Brain, took venture capital at the height of the first web boom in 1999 and was acquired by the Convex Group in 2002.
According to Alexa, How Stuff Works has passed its glory days of popularity, having peaked in 2005 and declined in traffic since then, however the site still ranks in the top 2000 sites online. (Ed.’s note: comScore shows HowStuffWorks with 3.9 million unique U.S. visitors in September, up 74 percent from a year ago, and with 18 million page views, up 40 percent).
NICE - congrats to these guys.
Does anyone know if they have a Facebook app yet? Seems like it would make a lot of sense to spin it as an educational tool for college/high school students inside of Facebook, let users submit their own knowledge, then highlight each user’s submissions on his profile.
Anyone have a link?
Dan
http://www.ackermangreenberg.com
one of the best (if not the best) educational websites.. very informative, easy and fun to read .. i personally benefited from it during college days.
does it depend solely on Ads income?
I don’t think the articles were written by users — as in user generated content
I really don’t understand this deal, they bought the site in order to bring its vast library of video content to the Web.
Why not just build the platform (1m) en spent the 249M(!) that’s left on producing high quality instruction video’s?
Or are they making money with the site and is the 250M just the result of a reasonable multiple?
Umm, Peter, you don’t get an established site with a huge number of links and other references on the Web, built over years and years of popularity and 11 steady million monthly uniques just because you built a similar site. Just because you build it, it doesn’t meant they will come.
Hi Jason. I agree with your point. Hsw is a very big site with a lot’s of nice content but Discovery bought the site to:
‘bring its vast library of video content to the Web’.
That implicates that they needed a good platform for the online distribution of their content. Discovery owns an enormous amount of very cool content, they can easily attract lot’s of visitors and dont need to spent 250M.
I’m an avid visitor to the “How Stuff Works” website, but I think $250M is a hefty price for a HOWTO site. But like Jason said, there is an incredible amount of back links associated with the site.
I guess Discovery is doing well (flushed with cash) nowadays with hits like American Chopper, Deadliest Catch, How do they do it, Mythbusters, amongst others.
Good for them and it seems like this is happening more and more lately. I still don’t get how this works from a profitability standpoint. There must be a lot more money in the advertising side of things than I understand.
It would be cool to do it with discovery.
Can anyone give some information on how much revenue / EBITDA the site has?
There has to be more to this deal than just content integration. $250 mil is an steep price to pay for HSW.com. If the traffic numbers quoted are correct I don’t see how a $50 mil valuation could be obtained.
HSW is a great site, agreed all around obviously, but $250M? I dunno about that.
Whit, they say that they have 11 million uniques/month. This price in not out-of-line for an established site with traffic like this. There are not many of them left out there. Compete shows traffic growth in the last year (I’m ignoring Alexa, because I have personal knowledge of how inaccurate they can be, even for large sites).
A good day for Atlanta and for current HSW folks. I wish both parties well, and glad to see a company I used to work for get a payday. The writers and editorial staff past and present should be particularly proud.
But the video angle is puzzling. A little bit of history: Before The Convex Group started to turn it into a megamart of loosely related page inventory (Mobil Travel Guide, Consumer Guide, evergreen tips and galleries), this site used to be known for its core mission: satisfying text-and-pictures explanations to interesting questions. Clear, simple explanation as entertainment. Then it became sort of a clearinghouse for all sorts of informational content with video as one of those sorts. They also ramped up a pretty interesting home-grown video initiative back then, but they haven’t done much to build a community around that or really push it as a standalone alternative to their tried-and-true core article format. No embedding afaik, no concerted effort to build community to current social media standards. They are just now starting to accept video submissions, but the process seems to be geared towards institutions really, not individuals, and it will be moderated with no explanation of exactly what the standards are beyond “safe” and “not advertising”. It’s not a platform that exists yet for comparison to the leaders. On the other hand, I imagine a big content brand like Discovery really liked how “safe” it will be.
I don’ t know if the numbers are accurate on traffic but it’s perhaps ironic that Alexa says it peaked in 2005, in that that’s when the push to integrate lots more peripheral but not really HowStuffWorksy content began and the focus started to blur.
My hope is that Discovery turns the mission back towards what HSW was known for in its heyday, trims out the peripheral stuff and streamlines the site, and takes users seriously in terms of community development.
This site became an obvious “adsense trap”.
Darn!
I was thinking about getting that! Now the price is gonna go up….
http://fakesteveballmer.blogspot.com
Great site! that will hopfully get even better.
Congrats on Discovery’s purchase. Well worth the price for all the content.
I hate to be skeptical but, hefty dowry aside, this marriage doesn’t sound like it’s gonna last. The two parties have very little in common.
Very little in common indeed, except from sharing knowledge about the world around us. HSW is indeed more text driven as someone said earlier in the comments, so maybe they will integrate some sort of text or word prompts into the video? Like interactive close captions, or the ads that are being integrated into videos? I don’t know, maybe someone knowledgeable in this sort of stuff can explain this?
That is cool, feels like they are made for each other.
http://vidsonly.blogspot.com
From the press release:
“Contextually integrating engaging clips drawn from Discovery’s vast video library of more than 100,000 hours of programming with the family-friendly and evergreen collection of expertly written articles on HowStuffWorks will ultimately deliver an accurate ‘video wikipedia.’ Information-seeking consumers will find a rich, multimedia experience to answer the world’s questions, and our business partners will find new opportunities to reach targeted audiences of engaged consumers.”
http://www.howstuffworks.com/d.....cement.htm
A stretch. You need heavy scare quotes for that — “video wikipedia” except without the wiki part or the people-powered part really. What’s left? More accurate to say “video encyclopedia” or something. “Accurate” according to who’s standards? It’ll be instructive to see what types of content they end up letting through. Will this be a place for legitimate brand critique? Companies get their explanations wrong all the time. And treating people like “consumers” of information. Community strategies that favor safe and corporate-friendly over negotiated and user-trusting can be pretty tough.
Go away Fake Steve, your comments are so annoying.
I have a better idea, how about “why stuff does’nt work”.
I bet this would draw more traffic than the other!
http://fakesteveballmer.blogspot.
Common People, read between the Lines… Discovery is running with an open check book so they will be in couple of years a leading Internet player regarding sustainable issues.
HSW is an Eco-content website that helps you fix and maintain your stuff, add a big Hugg from the TreeHugers and here we have a Green web leader.
Nice move again Discovery, What’s next on the list Guys?
Common People, read between the Lines… Discovery is running with an open check book so they will be in couple of years a leading Internet player regarding sustainable issues.
HSW is an Eco-content website that helps you fix and maintain your stuff, add a big Hugg from the TreeHugers and here we have a Green web leader.
Nice move, What’s next on the list Discovery Guys?
Actually Fake Steve has an incredibly good marketing plan. Instead of buying advertising, he just comments on every story at a site which has his exact target audience. His comment is a small snippet of his content, and if people like it they will click his link.
Ill admit it, I’ve been to his site. I bet we all have. Props to Steve, that is not a bad idea at all.
Shhhhhhh!
Duncan will hear you!
One correction though, what I do is called education of the ignorant masses!
You have been to my site, you must admit, you’re better off for it!
It even bolsters Techcrunch!
Everybody wins!
http://fakesteveballmer.blogspot.com
This site doesn’t have a tokbox girl so I don’t know how they’re getting to a $250MM valuation.
a good job i think…:)