Already looking to expand its content by offering daily sports podcasts, Spotify is in early talks with Bill Simmons about potentially purchasing The Ringer.
To get the deal done, Front Office Sports reports that the music-streaming giant will have to pony up about $200 million to pry the sports and pop-culture outlet away from Simmons.
However, FOS says that Simmons’ asking price is quite high and that The Ringer may actually only be worth about $90 to $100 million. The site makes more than $15 million a year in podcast ad sales, according to a 2019 Wall Street Journal story.
Given that amount of ad revenue, $200 million does seem like a high price to pay for a startup site that doesn’t break news and draws the majority of its traffic from podcasts, according to Eric Jackson, the founder of media and tech investment firm EMJ Capital.
“$200 million would be a whopping multiple for a media company at this time,” Jackson said. “If they offered that to him, if I were him, I would take it in a heartbeat.”
Should the deal actually go down, Simmons could seek some sort of reunion with his previous employer, ESPN.
“I could see him doing more and more crossover stuff with ESPN,” Jackson said. “It seems there’s been a de-frosting of the relationship there over the last few years. I think he could do other stuff beyond just continuing with The Ringer/Spotify if he did go on that path.”
Spotify and Simmons do already have a relationship as he launched a new original podcast hosted, “The Hottest Take,” in September which streams exclusively on Spotify.
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