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Warner Bros. Investing $18 Million in Machinima

Mar 12, 2014 07:57 PM EDT | By John Nassivera

Warner Bros. is investing $18 million in Machinima Inc., a YouTube network that lets users watch, share and create video-game content.

Machinima announced the deal on Monday, and previous investors Google, Redpoint Ventures and MK Capital will be participating. The participation of the companies brings the investment in Machinima to almost $67 million, according to Variety.

Machinima laid off 42 employees last week as part of a reorganization of sales, Recode reported. The company said in an email that they are looking to "create greater focus internally on selling creative ad solutions and brand entertainment."

Machinima CEO Allen DeBevoise talked about the benefits that working with Warner Bros. will bring to the company, according to the Hollywood Reporter.

"We are thrilled to be partnering with Warner Bros., the leading producer of exactly the type of content that resonates with our global audience of video gamers and millennial males," DeBevoise said. "There are myriad opportunities to connect Warner Bros.' content to our audience across YouTube and our highly successful apps, and similarly to maximize the value of our content by utilizing Warner Bros.' expertise in global distribution beyond YouTube."

Thomas Gewecke, chief digital officer and executive vice president of strategy and business development at Warner Bros. Entertainment, pointed to Machinima's success online as a reason for the investment, Deadline reported.

"Machinima has been a pioneer and category leader in the YouTube MCN space, with thousands of channel partners and a premium brand that reaches millions of daily users," Gewecke said. "We've been impressed with Machinima as a distribution partner, and by their focus on creators and commitment to high quality, exciting original digital content."

The investment builds on the relationship Warner Bros. has with Machinima, Deadline reported. Machinima is Warner Bros.' distribution partner for two seasons of "Mortal Kombat: Legacy," the live-action web series based on the Mortal Kombat video game franchise.

"Machinima connects with a worldwide audience of millennial fans and creators," said Craig Hunegs, president of business and strategy at Warner Bros. Television Group. "We're excited about the opportunity to work closely with Machinima and its channel partners to reach new audiences, create new original content, and discover new talent."

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