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đź“şThe Billion-Dollar Baby Media Roll-Up
The Moonbug Story—Blackstone’s Bet on Digital Childhood
Today’s newsletter is a break from the healthcare roll-up series, but I loved learning about this one!
As always, if there’s a sector or company you’d like me to dig into, drop me a note at [email protected].
PE Playbook: Moonbug Entertainment
State of Play
The children's entertainment landscape has transformed drastically in recent years. Linear TV, once the dominant medium for kids’ content, has seen viewership collapse by 85–90% in the last decade. For example, in 2016, Disney Channel and Nickelodeon each averaged around 1.3 million daily U.S. viewers, but by 2023, those figures had plummeted to barely 130–180k (R.I.P. Spongebob!).
At the same time, children have flocked to on-demand digital video. As of 2024, kids 2–17 accounted for nearly 30% of all YouTube viewing, showing how platforms like YouTube and Netflix have become the new “Saturday morning cartoons.”
Riding on this mega-trend, ex-Disney and Wildbrain execs René Rechtman and John Robson launched Moonbug Entertainment in 2018. After successfully rolling up some of the top kid’s YouTube channels like CoComelon (the 3rd most subscribed channel worldwide), Moonbug was acquired by Blackstone in 2021 for $3 billion to continue its empire building in kid’s content.
In this piece, we’ll walk through the rise of Moonbug Entertainment and how it’s evolved from a YouTube content business into a mini-Disney.
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