Happy Wednesday! It’s week two of diving into the Kid’s Media industry (one more week and it’s a trend), this week we’re looking into IVEST’s acquisition of the Care Bears franchise and the role of private equity in kid’s television.

Care Bears acquired by private equity fund IVEST Consumer Partners

Last week, Cloudco, the rightsholders to the Care Bears, Holly Hobbie, and more, was acquired by IVEST Consumer Partners, a private equity fund that focuses on consumer products, licensing, and retail companies. IVEST was founded by George Jones, a former Warner Bros. president of global consumer products and licensing. Cloudco sought an acquisition by private equity due to concerns that an acquisition by an entertainment or toy company would lead to the merger of Cloudco into existing operations. The deal is reported to be worth $100 million.

Jones emphasized the importance of IP in reference to the appeal of this deal saying, “If a company is fortunate enough to have a classic evergreen property in their IP portfolio, as Cloudco has with Care Bears, it will continue to provide a dependable revenue stream at high margins for many years to come.”

Although nothing has been announced, IVEST plans to monetize new and existing brands while incubating new content and IP. The Care Bears currently star in Care Bears: Unlock the Magic (the sixth television series based on the franchise). The series airs across Warner Bros. Discovery’s portfolio of distribution channels including Boomerang, Cartoon Network, Cartoonito, and Max.

You can also catch the original 1985 Care Bears Movie for FREE on Pluto TV!!

The Care Bears acquisition is reminiscent of the colossal $3 billion acquisition of Moonbug Entertainment by Candle Media in 2021. Candle Media, backed by private equity firm Blackstone, acquired the company to unlock a licensing and merchandising juggernaut built on IP such as Cocomelon, Blippi, Little Baby Bum, and more.

Cocomelon is currently one of the most important Kids IPs in the world. It has been in the Netflix Top 10 for 135 consecutive weeks, the third-longest streak in Netflix history. In the latest release of the Nielsen Streaming Ratings, Cocomelon had over 652 million minutes viewed during the week of July 31st. Since the acquisition of Moonbug in 2021, Kevin Mayer and Tom Staggs, both former Disney executives who were involved with Disney’s acquisitions of Marvel and Lucasfilm, have continued to acquire studios and IP, including other YouTube-focused kids IP such as Little Angel and Oddbots.

Despite some success in private equity’s entrance into the world of kids’ television, the involvement of these firms does present challenges. During a roundtable on kids’ content financing, Genevieve Dexter founder and CEO of Serious Kids, mentioned that when taking private equity “you are then accountable to these people who’ve invested in your program in perpetuity,” She emphasized, “It becomes quite an onerous long-term obligation because you’re having quarterly board meetings, and you’re preparing presentations and reports over a 10- to 20-year period for that one property.” Beyond the obligations, she also mentioned the pressure to perform, “Equity firms and investment firms are quite happy if you do very well, and they’re quite happy if you go bust. But what they don’t like is anything in the middle. If you go bust, there are tax rebates for their investment. And if you’re doing very well, of course, everybody’s happy. They hate what they call a zombie company, where you’re hand to mouth. You’re not making a lot of money. You’re not losing a lot of money. So you’re constantly under pressure to go one way or another.”

📰 In Other News

• Take your kid to work strike day happened in NYC as children joined their striking parents for the Children’s/Family TV Writers Solidarity Picket held by the WGA with SAG-AFTRA

• CEO of Kids Industries, Gary Pope, breaks down if YouTube is doing enough to protect children’s privacy

• Jurassic Park is getting LEGO-fied in upcoming special

• US churn rate for streaming services hit 47%, with 29% of households saying they cancel a subscription to save money

• Harry Potter and the Cursed Child is coming soon to a school near you!!

• Warner Bros. Discovery’s Boomerang becomes Cartoonito in the Nordics and MENA regions

📽️ At the Box Office

This past week, Barbie surpassed The Super Mario Bros. Movie to become the highest-grossing movie of 2023. This year has been a dominant year for franchises with 8 out of the top 10 films being based on established IP (Oppenheimer and Elemental being the two originals).

• Superheroes are maintaining relevance with Marvel properties continuing to dominate the conversation, DC released three films this year that landed outside the top 10: The Flash (#16, $268M WW), Shazam! Fury of the Gods (#23, $133M WW), and Blue Beetle (#26, $104M WW).

• Elemental has been this summer’s biggest surprise after its initial release was considered a flop by many analysts. However, the movie was able to capture an audience across the globe to reach profitability.

🎬 Releases on my Radar

• 8/31 - Adventure Time: Fionna and Cake on Max

• 8/31 - Karate Sheep on Netflix

• 8/31 - Spellbound on Hulu

• 8/31 - One Piece on Netflix

• 9/01 - The Wheel of Time on Prime Video

• 9/06 - I am Groot on Disney+

• 9/06 - Doc McStuffins: The Doc & Bella Are In! on Disney+

• 9/06 - The Little Mermaid on Disney+

• 9/06 - Pokémon: Paldean Winds on Youtube

• 9/07 - Kung Fu Panda: The Dragon Knight (S3) on Netflix

• 9/08 - Pokémon Ultimate Journeys: The Series on Netflix

• 9/08 - Tiny Toons Looniversity on Max

• 9/14 - Barbie: A Touch of Magic on Netflix

• 9/14 - Dragons: The Nine Realms (S7) on Hulu and Peacock

• 9/18 - My Little Pony: Make Your Mark: Chapter 5 on Netflix

• 9/18 - Alma's Way (S2) on PBS Kids