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New media
new opportunities
E
ric Rosenkranz has lived and breathed the world
of advertising for more than 30 years working
with a huge array of clients – Procter & Gamble,
Mars, Wrigley, GlaxoSmithKline, Novartis, Danone,
Bristol-Myers, 3M, Oracle and Unisys – to name but a
few.
Until 2004 he was President of Grey Global Group
Asia Pacific. The following year, as Vice-Chairman of
Focus Media China, he was instrumental in leading
the company to a highly successful NASDAQ listing.
In 2007 he assisted in selling an outdoor media
company to NEWS Corp. The following year he
co-founded mStream.
Eric says that media, Asia, IPOs and venture
capital are all in his blood!
Platform spoke to Eric to get the inside track on
mStream.
Q: mStream is in the digital media signage business
in China. What exactly does that mean?
A: Television in China is mass market, which makes it
expensive to reach certain key demographic
audiences. Companies have become quite
successful in targeting, for example, businessmen by
placing adverts on screens in office towers, or
reaching high disposable income travelers via
signage in airports.
Q: What does mStream do?
A: We place digital TV screens in hair and beauty
salons and coffee shops throughout China, and sell
advertising to companies wishing to reach the key
demographic of upwardly mobile young women.
Q: So what’s different about your company?
A: Our key difference is that we have acquired an
existing Chinese company, which already has 5,000
racks distributing magazines throughout Shanghai.
We are converting their current traditional racks into
Digital Magazine Racks (DMR) with an LCD screen,
which generates far higher revenues and margins
via TV ads. This idea of combining high - end
magazines and LCD screens is a first in China.
We have already deployed more than 100 DMRs
in premium outlets in Shanghai’s central business
district, including all Coffee Beans and other high-
end chain outlets. Having free access to these sites
Eric Rosenkranz
(left)
mStream display
(far left)
is allowing us to expand at an extraordinary rate.
Q: Isn’t this the worst time in the world to be starting
up a new company.
A: Not at all! Firstly, we are not a start-up – we already
have $1.5m in revenue and are profitable.
But most importantly, everything is cheaper now
than 12 months ago. We can purchase equipment
for less, and the companies we have targeted for our
expansion into other cities are looking for much
lower valuations now than they were six months
ago.
Q: What is your relationship with MBMG?
A: Actually, we have several. First, Paul Gambles is
advising our company on the some of the legal and
financial aspects of running our business. Second,
we need money for further expansion. MBMG has
launched a new Venture Capital, Peak XV, and
mStream is honoured to have been chosen as the
fund’s first investment.
Q: What is the potential reward for a prospective
investor?
A: The sky’s the limit! (I hope I can say that legally).
I took another Chinese digital media company
public on NASDAQ recently and it achieved a top
valuation of $7billion. The initial investors in that
company received a return of over 100 times.
Q: Thank you. Anything else?
A: Venture Capital is good to have in every portfolio
…at appropriate amounts, say 5-10%. Peak XV
spreads the risk by investing, not only in mStream,
but in a range of investments, some endorsed by the
MAI (The Stock Exchange of Thailand’s Market for
Alternative Investment).
P L A T F O R M
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