Kevin Mayer Defends Candle Media’s Acquisition Approach: “We Did Not Overpay for Hello Sunshine”

Kevin Mayer Defends Candle Media’s Acquisition Approach: “We Did Not Overpay for Hello Sunshine”

Kevin Mayer shrugged of the “valuation-haters” and gave insights into the big-ticket investment strategy behind Candle Media Wednesday’s appearance at the APOS Media Summit in Singapore.

Mayer stated flatly that Hello Sunshine was not overpriced. He also defends his company, which he coheads with Tom Staggs from one persistent criticism. Reese Witherspoon founded Hello Sunshine and it was bought by Candle Media last January for around $900million. Mayer argued that the acquisition “will be a big win” while explaining how it fits into his company’s overall strategy. He noted that Candle Media’s vision is the result of his experiences at the top of TikTok and Disney.

Mayer was last assigned to Disney as the oversite for the development and launch Disney , the company’s vertically integrated direct–to-consumer platform. Mayer said that he saw the value in high-end content made by independent studios who were willing to sell it, and that he was a pillar of Candle’s approach.

Mayer, who was only the CEO of TikTok for a short time, gained an insight that would be used as a strategic justification for Candle’s strategy. He stated that he was amazed at the volume of commerce taking place on TikTok’s parallel Chinese service Douyin. This was primarily via live-streaming and asynchronous electronic commerce opportunities. “Why did that happen?” He explained that the trust and dynamics between brands and influencers is remarkable, especially if there is a strong connection. “Within that dynamic it’s very simple to sell products and very simple to conclude ecommerce transactions — and that’s more likely to happen in the West .”

Mayer stated that Hello Sunshine had the three essential pieces he and Staggs looked for when targeting acquisitions. A well-defined audience with strong social media presence (Reese Witherspoon), a mission of content created by women, the opportunity to create high-quality film and television to enter the market, and underlying ecommerce potential.

Mayer gave the example of the Hello Sunshine home improvement program Get Organized with The Home Edit ,, which streams on Netflix. It started as a book and line home organization products. But now there is a whole range of branded merchandise at the Container Store. Mayer stated that they have a strong social media presence thanks to the founders of The House Edit , Reese Witherspoon and traditional film and television, as well as the underlying commerce. That’s a great flywheel

Mayer stated that a similar reasoning underpinned Candle Media’s $3B acquisition of Moonbug Animation, a kids entertainment company. Moonbug Animation is home to the CoComelon franchise. It has also spawned a popular Netflix series and “licensing opportunities and merchandising possibilities that are incredible .”

Mayer responded to questions about Candle Media’s takeover targets and the high prices it paid. “You have got to look at the cash-generation potential under your ownership. It should be worth more than on a standalone .”


He said, “There are always valuation-haters,” noting that investors and analysts initially laughed at Disney’s $7.4billion deal for Pixar as well as the $4 billion acquisition of Marvel.

Mayer stated that he hopes to provide creators of content companies he purchases the freedom and space they need to create, much like Disney did with its acquisitions. He also plans to centralize their infrastructure and monetization operations under Candle Media. “That gives us more market presence with the buyers — Netflix, Amazon Prime, or Apple TV. … We bring a portfolio of products to buyers, which creates a dynamic in the marketplace.”

As Candle looks to its next acquisitions, Mayer said he believes “Asia is going to be a very fertile place for us to buy assets.” He said he and his partners are looking for media, tech and entertainment firms that have “that flywheel” capacity, “and Asia is a place where we think there’s great potential for that, especially if you think about the commerce and social media dynamic.”

Mayer said that he was not concerned by the 2022’s ‘great Netflix correction’ and the potential threat it might pose to Candle Media’s strategy pillar of producing TV and film content to sell to streamers at top dollar. It is still growing, even with the Netflix stumble — which I think has been overstated, somewhat. Even if Netflix weren’t growing, I don’t know how much money is being spent on content purchases and investments made by streaming services around the globe. Candle Media is still small in comparison, so we have a huge runway for growth as an independent content supplier of premium television content. Candle Media is still pretty small in comparison, so we have a huge runway for growth being an independent content supplier of premium television content.”

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