By TECH CORRESPONDENT
The 196-year-old British newspaper is launching a £42 million (Sh 5.7 billion) investment fund, it announced on Wednesday, with plans to invest in media-tech startups.
GMG Ventures, as the new unit will be called, will pour its pot of cash into “early stage businesses focused on developing the next generation of media technology” — in areas ranging from AI to advertising technology and payment tools.
Guardian Media Group (GMG), The Guardian’s parent company, loses tens of millions of pounds every year. In the last financial year it lost £45 million ($59 million) — though it says it wants to break even within two years. GMG holds more than £1 billion ($1.3 billion) in assets, the proceeds from which are used to fund The Guardian’s operations.
Some observers on Twitter poked fun of the news in light of The Guardian’s financial situation. “They weren’t losing money fast enough,” joked London entrepreneur Rodolfo Rosini. “What do you do when you can’t make money from publishing [The Guardian]? Become a venture capitalist apparently,” said another Twitter user.
The Guardian has been going through wrenching times. Its American subsidiary has cycled through leadership and staff. The British news outlet loses tens of millions of pounds every year.
The overall business has been hemorrhaging money for years, and its slow adoption of a volunteer donation / unpaywall hasn’t helped much.
But perhaps an injection of entrepreneurship could help? Guardian Media Group announced plans to fund a new venture capital arm with £42 million ($55 million) to focus on early-stage media startups in AI, ad tech and payment systems.
Guardian Media Group (GMG CEO David Pemsel said in a statement that “GMG Ventures will aim to secure investments in some of the very best new businesses emerging out of the media and tech space in the U.K., U.S. and Continental Europe.”