• Target

    £1,000,000

  • Type

    Equity

  • Close Date

    Aug 31 2019

  • Status

    Open

RISK WARNING: Your capital is at risk. The risks include: the lack of liquidity in this market in terms of being able to realise investments and the loss of the value of investment. When you invest any loss in value will not be covered by the Financial Services Compensation Scheme.
Please read FULL risk warning.

DMD

DMD is building a global, digital content distribution enterprise delivering its world cinema service on-demand to 17m homes in Latin America.

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Investment closes only once the total pledged amount passes the minimum of £250,000

Total Pledged: £45,000
Max

£1,000,000

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Overview

Transactional Video On Demand
Over the last two years, DMD has built a digital content distribution enterprise with its world cinema Transactional Video On Demand product (TVOD). We have built a base of long-term distribution partnerships with major cable, telephone/IPTV and OTT companies that reach the wealthiest share of the Pay TV market, covering 19 countries in Latin America serving 17 million two-way homes, i.e. homes that are capable of interacting with Video On Demand product.
 
This is now delivering a growing revenue stream:  DMD’s revenue increased by 93% YoY 2017-2018 and this growth sees the company projected to reach EBITDA breakeven in Q3 of 2019.
 
DMD has built relationships with leading sales agents and distributors in Europe and the USA, which are the prime source of film rights. As a result it has built a rights catalogue of over 130 films with the big majority being first run premieres for Latin America. 
 
DMD offers the first place to see these films on TV screens across the region. The company is delivering an average of 5 titles per month: a volume that has been consistent and reflects our focus on quality rather than quantity, which has been much appreciated by our affiliate partners. Having built up a sizeable distribution base, DMD is now looking to start acquiring bigger films (including more films that have enjoyed theatrical exposure in Latin America – a driver of subscription rates). Together with a broader overall distribution, this will serve to rapidly grow the TVOD revenues resulting in the faster growth of accompanying gross margins. 
 
DMD has created a digital workflow with third party vendors that allows for the instant delivery of our films to the company’s affiliate platforms in Latin America. This established pipeline means we are in a position to deliver additional services to all of these platforms and to other new platforms very easily, quickly and cost effectively in the future. Our workflow systems have been set up so that DMD can expand its film and other content delivery to other geographic regions at relatively small incremental cost. 
 
Subscription Video on Demand
The Company will be launching an SVOD service in 2019 consisting of similar product to its TVOD service plus a curated selection of well-known classic films. This allows viewers a choice of our films as an “all you can eat” model (but later) or choosing film by film (TVOD). 
We will be launching it via our cable affiliates (broadly on a paid-for subscription basis) and eventually as a standalone product available via an app.
 
A large part of our acquired catalogue already includes SVOD rights. This means that the cost and risk of launching the new SVOD service is significantly reduced because over 100 films that we have acquired to date already include these SVOD rights and the cost of have already been localisation, digitisation and delivery to the various platforms has already been incurred, which thereby reduces the cost to any new affiliate partner of launching our SVOD service. 
 
The current round of fundraising will enable DMD to acquire bigger movies, which will serve to enhance consumer demand for its TVOD services and improve the perceived value of the forthcoming SVOD service.
 
Our roll out strategy focuses firstly on offering the SVOD service to the customers of our existing affiliate partners. Secondly, after having built more awareness for the brand and the product, we will launch it on multiple devices as an Over The Top service (OTT), i.e. not requiring a set top box that our affiliate partners use.
 
Management
The company has a highly experienced team that manages the operation whilst the distribution partners mitigate the risk of direct collection of transactional revenues. 
 
The management team have: 
 
  • A proven track record of creating international entertainment services with high exit multiple returns to investors, 
  • Extensive content rights experience, 
  • Deep operational and distribution expertise,
  • C-suite contacts throughout the entertainment industry.
 
Raise
DMD is seeking to raise £1.0 million to launch and rapidly expand its movie SVOD brand in the coming years. The money raised will be used to:
 
  • Acquire bigger and more commercial films, 
  • Promote our film releases on main local advertising channels focused on cinema,
  • Supplement the current output with classic titles,
  • Fund the building and establishment of the Cine del Mundo consumer brand, and, 
  • Increase DMD’s global footprint by launching the services in Europe, Asia and Africa.
 
The raise will value the company at £4M post money and will attract 25% of the Company’s equity.
 
 
Additional Services
The company will also seek to use its unique position in the market to develop and seed other SVOD services in return for management distribution rights and carried interests. The first one of these is:
 
  • César’s Pet Planet – a Family & Lifestyle Entertainment service – in partnership with the world-renowned “Dog Whisperer” - César Millán.  To date we have set up the joint venture with our partners, worked up a schedule and formulated ideas for original programming content and most importantly of all have agreed initial terms with external investors that value the business idea at around $20million. 
Svodscreen
Deal Manager avatar

Deal Manager
Tobias Hurdle

  • Sector: Media and Creative
  • Region: UK: London
  • Stage: Established - existing revenue, pre-profit
  • Eligible Tax: EIS
  • Board Requirement: Will consider further board appointments
  • Pre Money Valuation: £2,925,000
  • Share Price: £5.00
  • Originator: Envestors
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Originator


Originator: Envestors

Investment Focus: Equity and Debt

About: Envestors is a FCA regulated corporate finance adviser in the UK and operates an international network of sophisticated investors investing an average of £42,000 in high growth unquoted companies seeking £250,000 to £2m in equity funding.

Contact Name: Oliver Woolley

  • Registered Investors
    Over 1000
  • Investment through platform
    Over £100m