Brad Greenspan

Brad Greenspan is an internet entrepreneur who has been involved in the founding and proliferation of various web properties including MySpace. Greenspan founded eUniverse Inc. in 1998, which went public in 1999 and under Greenspan’s leadership increased revenue from $1.8 million in the fiscal year 2000 to over $15.6 million for the fiscal year 2001 and became cash-flow positive as revenue grew to over $33.1 million for the fiscal year 2002 and over $65.7 million for the fiscal year 2003.[1] The company survived the .com-bust of 2001 and launched 100% owned MySpace.com in August of 2003.

Prior to the launch of Myspace, Greenspan grew eUniverse into one of the largest entertainment networks on the internet which MediaPost’s “Everybody Loves eUniverse” article described as offering “ its visitors an escape from the grind of their daily routines with entertainment offerings ranging from games and funny greetings to jokes, newsletters, and short animation”.[2]

According to Nielson-Netratings, the eUniverse Network was the sixth-largest internet property for the week ending October 28, 2001.[3]

Greenspan is the only U.S. CEO to have created three separate #1 websites ranked by U.S. monthly unique audience: Nielsen Netratings ranked Flowgo.com the #1 entertainment website in June 2001 with MediaPost noting its “astounding 300% growth in traffic during the past year”,[4] Skilljam.com the #1 play for cash skilled gaming website in September 2003, and Myspace.com which became the #1 Social Network in February 2004.[5]

Greenspan resigned from eUniverse in late October 2003 as CEO and as a Director in December 2003, stating that he felt that other "directors have breached their fiduciary duties to the Company and its stockholders."[6] The company was sold to News Corp in 2005 for $12.00 per share in cash, which Greenspan, the largest non-insider stockholder opposed. In September 2005 Greenspan formed FreeMySpace LLC for the purpose of giving shareholders the “opportunity to participate in the exciting future of MySpace.com as a free and independently thriving business”.[7]

On September 23, 2005, an investor group led by Greenspan, FreeMySpace LLC urged shareholders to vote against News Corp’s offer which “significantly undervalued” MySpace which had the “potential to achieve values in the coming years approaching that of other publicly traded online companies such as Google, Yahoo and eBay." FreeMySpace made a counteroffer allowing each shareholder to sell up to 50% of their shares at $13,50 a “significant premium to the proposed News Corp offer” continue to own shares in MySpace’s publicly traded parent company which would be “transformed to focus exclusively on MySpace, divest non-MySpace assets to generate resources necessary for growth and development and be renamed and trade as MySpace. [8]

MySpace’s publicly traded parent company rejected FreeMySpace LLC’s offer calling it “speculative” before completing the transaction with News Corp in early October 2005.[9]

Angel Investing

Websites launched by Greenspan and eUniverse included:

Flowgo.com launched in late 2000 focused on viral entertainment including flash cartoons and greeting cards. By June 2001, Flowgo.com had become the #1 entertainment website on the internet with 12,980,000 unique monthly visitors according to Nielsen NetRatings.

Madblast.com launched in 2001 and became a leader in online flash games.

CupidJunction.com launched in 2001 was eUniverse's dating website.

Justsaywow.com launched in 2000 was a leader in flash entertainment and boasted a daily email newsletter with over 50 million subscribers.

Skilljam.com a skilled online gaming property was launched by eUniverse in 2002. In March 2003, Skilljam announced it had struck an exclusive multi-year partnership to run skilled pay-per-play gaming for Microsoft’s MSN property. Forbes described the partnership in a March 18, 2003 article titled “Win Bill Gates’ Money”.[10]

Greenspan has invested in several other businesses as an angel investor, e.g. Gametize.com a fast-growing Singapore online gaming company, Shoppinglifestyle.com a fast-growing portal focused on a young female demographic, Broadwebasia (an Asian internet company, out of business), Borba (a health product-line, not available anymore), and LiveUniverse (a social network focused internet company, out of business). LiveVideo, Inc. and its livevideo.com (now defunct) social network launched in 2008 were one of the first live-streaming platforms.

Greenspan invested in the first outside round of BigFishGames, Inc. in 2006, and in 2008 when BigFishGames raised $83 million from venture capital funds, Greenspan sold his stake for over 1000% profit.[11]

Greenspan was also an early investor in mobile entertainment startup New Motion, Inc. in 2006 and owned approximately 6% of the company when it went public in 2008, selling his stake for an over 2000% profit.[12]

Greenspan invested in China based Hupo.TV, an online video site, in 2006, which grew to over 30 million unique monthly users by December 2007.[13] Greenspan's BroadwebAsia partnered with Major League Baseball Advanced Media (MLBAM) in 2008 to launch MLB.com's first Chinese website MLB.cn.[14]

Dow Jones

In mid-2007, Brad Greenspan presented a takeover bid for Dow Jones' The Wall Street Journal (WSJ) against News Corp.[15] Greenspan was unsuccessful in his bid against News Corp.[16]

History

Brad Greenspan attended UCLA, where he launched his first company, Palisades Capital, from his dormitory room.

MySpace

The MySpace service was founded in August 2003 as a new initiative and 100% owned division of publicly-traded internet company eUniverse (which later in mid-2004 changed its name to Intermix). eUniverse created and marketed the Myspace website, providing the division with a complete infrastructure of finance, human resources, technical expertise, bandwidth, and server capacity right out of the gate so the MySpace team wasn’t distracted with typical start-up issues. The project was overseen by Brad Greenspan (eUniverse's Founder, Chairman, CEO), with Chris DeWolfe (MySpace's former CEO), Josh Berman, Tom Anderson (MySpace's former president), and a team of programmers and resources provided by eUniverse.[17]

Brad Greenspan / The MySpace Report

In October 2006, Brad Greenspan launched a website, called freemyspace.com, and published reports that called for the Securities and Exchange Commission, the United States Department of Justice, and the U.S. Senate Committee on Finance to investigate News Corp's acquisition of MySpace as "one of the largest merger and acquisition scandals in U.S. history."[18] The report's main allegation is that News Corp. should have valued MySpace at US$20 billion rather than US$327 million, and had, in effect, defrauded Intermix shareholders through an unfair deal process.[19] The report received a mixed response from financial commentators in the press.[20] A lawsuit led by Greenspan challenging the acquisition was dismissed by a judge.[21] Greenspan's claims were validated when in June 2010 Judge George H. King ruled in favor of shareholders in a summary judgment decision. According to Gretchen Morgenson of The New York Times, "Viewed as a whole, Judge King wrote, the evidence indicates that “there are at least triable issues of fact” about whether Mr. Rosenblatt acted in good faith or tilted the auction in favor of the News Corporation “for a purpose other than maximizing shareholder value.”

A trial might also determine if the rest of the Intermix board improperly put Mr. Rosenblatt in charge of the auction process and then turned a blind eye to his actions, the judge concluded." Further, the Judge refused to dismiss the damage report finding "shareholders suffered economic damages in the News Corporation bid of $506 million to $667 million" [22]

References
  1. "Form 10-K". www.sec.gov. Retrieved 2022-04-05.
  2. "Everybody Loves eUniverse". www.mediapost.com. Retrieved 2022-04-06.
  3. "NetRating's Weekly Top 10". www.mediapost.com. Retrieved 2022-04-06.
  4. "Flowgo is #1". www.mediapost.com. Retrieved 2022-04-06.
  5. "MySpace.com surpasses Friendster.com in web rankings". www.thevirtualhandshake.com. Retrieved 2022-04-06.
  6. "Letter from Brad Greenspan".
  7. "General statement of acquisition of beneficial ownership".
  8. "Major Intermix Investor Offers Stockholders $13.50 Per Share".
  9. "INTERMIX MEDIA, INC. PRESS RELEASE".
  10. "Win Bill Gates' Money". Forbes.
  11. "Big Fish Games Closes $83 Million Financing with Premier Investment Firms".
  12. http://www.nasdaq.com/markets/spos/filing.ashx?filingid=5043690
  13. "Archived copy". Archived from the original on 2015-09-23. Retrieved 2015-07-22.{{cite web}}: CS1 maint: archived copy as title (link)
  14. "Greenspan's BroadWebAsia Gets MLB Rights in China". CBS News. 2008-03-31. Retrieved 2008-03-31.
  15. Greenspan outlines alternate plan for Dow Jones - MarketWatch
  16. Peers, Martin (2007-08-02). "Murdoch's Next Focus: Business-News Battle". The Wall Street Journal.
  17. "Tales In Tech History: Myspace".
  18. "Myspace.com Founder Issues Report Finding News Corp.'s Myspace Acquisition Defrauded Shareholders of More Than $20 Billion". ecoustics.com. 2006-10-09. Retrieved 2007-02-25.
  19. Chmielewski, Dawn C. (2006-10-08). "MySpace Founder Seeks Inquiry". Los Angeles Times. Retrieved 2007-02-25.
  20. "Was MySpace Sold on the Cheap?". Business Week. 2006-10-06. Retrieved 2007-02-25.
  21. "Suit over sale of MySpace dismissed". Seattle Post-Intelligencer. 2006-10-10. Retrieved 2007-02-25.
  22. "Bidder Beware". The New York Times. 2010-07-03. Retrieved 2010-07-04.
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