Startup acquisitions happen all the time in Silicon Valley, but more and more often, they are starting to happen for tech companies based in Los Angeles. A big reason for that is Michael Jones of Science, the so-called "startup studio" behind FameBit, which was purchased this week byGoogle.
Science was the sole investor of FameBit, a service that connects famous YouTubers with brands interested in promoting their products and services. The Santa Monica studio was also the initial investor to backDollar Shave Club, the razor delivery company that sold to Unilever this summer for $1 billion . And Science was the owner ofHelloSociety, the digital marketing agency purchased in March by The New York Times.
The five-year-old company straddles the line of acting as both a venture capital firm and a startup incubator.
"I am OK if we start the company with a founder, if we invest in a company with great founders, if we buy a company with great founders--I don't care how it gets to that," said Jones, Science's CEO. "What I know is that in order for me to have successful businesses, I need epic founders and really good ideas.
In the Los Angeles tech scene, Jones and his team have been rock stars for some time. Jones came to fame five years ago after managing to salvage News Corps's $580 million bumbled purchase of MySpace by serving as CEO for two years and selling itfor $35 million to a group that included artist Justin Timberlake.
More recently, Science has been behind many of the top startups to come out of Southern California. The firm is an investor in DogVacay, the pet boarding marketplace, and MeUndies, the underwear lifestyle brand.
Dollar Shave Club, FameBit and HelloSociety marked the major successes of Science's first vehicle, but already, Jones and his team have been busy launching, acquiring and investing in new startups.
In its first go-around, Science was on the lookout for companies that enable people to act as their own publishers as well as those that allow brands to sell directly to consumers. FameBit and HelloSociety (people publishers) and Dollar Shave Club (direct to consumer) proved Science's first thesis.
"We had a theory. We executed against that theory, invested and built businesses within that theory, and then saw value come out of those investments," said Jones, a quick-talking serial entrepreneur and investor who always drives straight to his point.
Now, Science is chasing a different thesis focused on finding and creating startups used by millennials as alternatives to their TVs.
"How do millennials consume content? And how do they feel connected to brands? And how do they get entertainment through phones?" Jones said.
Science is focused on finding companies that will become the hubs where millennials will turn to for their information as well as their entertainment. He wants mobile apps as well as startups whose services are built on top of Instagram, Snapchat and Facebook Live--the key services where young users gather.
One such example is Los Angeles' Feldspar Studios , which creates animated series distributed daily through pages on Facebook. "It's basically the concept of 'what's Cartoon Network, what's Adult Swim' on Facebook, on Snapchat and on Instagram," Jones said.
It remains to be seen if Science's second wave of startups will be as successful as its first. But the company is in it for the long haul and plans to patiently build up its next investments. In the meantime, Jones is happy to see Los Angeles growing as an entrepreneurial hub, and wants to do his part to further that.
"We're building companies that others are valuing," he said.