IAC sells CollegeHumor to executive Sam Reich, resulting in 100+ layoffs

IAC has sold off a majority stake in CH Media, the parent organization behind CollegeHumor . The new owner? CH Media’s chief creative officer Sam Reich.

Reich announced the move on Twitter, saying that digital media holding company IAC “made the difficult decision to no longer finance us,” but that it would allow him to “run with the company.”

He continued, “Of course, I can’t keep it going like you’re used to. While we were on the way to becoming profitable, we were nonetheless losing money — and I myself have no money to be able to lose.”

In fact, Reich said that more than 100 people are losing their jobs as a result.

Bloomberg reports that the company will be left with a team of between five and 10 people. It also reports that IAC will maintain a minority stake in the company.

In a statement, IAC said, “Sam was the best choice to acquire CH Media and define its next chapter. The decision places CH Media with an owner who is beloved by fans, passionate about the business and sees a future we believe in.”

CollegeHumor launched its own subscription streaming service called Dropout in 2018, and Reich said, “The #1 way you can support me is to stay subscribed to Dropout.” He claimed the service still has six months of additional content ready to go, and that it will be launching version 2.0 at the end of this month.

After noting that many Dropout shows may need to take “bold new creative directions in order to survive,” Reich added, “I will, however, do my very best to stay true to the talent, shows, fans, and principles that got us where we are today. We dropped out once before; we can do it again. Independent comedy lives on — just now more independent (gulp) than ever before.”

CollegeHumor unveils Dropout, a subscription service for comedy videos, comics and more

CollegeHumor is getting into the subscription business with a new service called Dropout.

Dropout is part of CH Media, the IAC -owned subsidiary that also includes Dorkly, Drawfree and CollegeHumor proper. It’s not just a subscription video service. Yes, there will be ad-free video series, many of them starring familiar faces from previous CollegeHumor shows, but Dropout will also offer comics and chat stories.

The shows include “Dimension 20: Fantasy High”, which CollegeHumor describes as what you’d get “if John Hughes ran a tabletop RPG,” plus a second season of “Lonely and Horny” starring Jake Hurwitz and Amir Blumenfeld. Many of the comics and chat stories will tie into the series in some way, and there will also be a members-only Discord channel allowing subscribers interact with CollegeHumor creators and stars.

Chief Business Officer Shane Rahmani said that rather than SVOD (subscription video on demand), Dropout is offering “SMOD — subscription media on demand.” He added that with a subscription model, CollegeHumor can “play at a proverbial next level of investment,” with content that “feels much more premium.”

It’s been a little over a year since NBCUniversal announced that it was shutting down its own comedy streaming service Seeso. Rahmani didn’t discuss Seeso directly during our interview, but he addressed the broader question: “Why do I think this will work?”

“It really all comes down to the core offering for this very specific consumer,” he said. “It’s built for a very digitally native consumer particularly, someone who loves nerd culture but also loves comedy and goes out to things like Comic Con. Someone who plays a lot of video games and loves being a fan of ours. We’re dead-focused on meeting their needs specifically in the first year.”

CollegeHumor Dropout

Although Rahmani and his team have a clear audience in mind, they don’t see “nerdy” as synonymous with “white guys.” In fact, when I asked about diversity of talent and of audience, CollegeHumor sent me the following statement from Chief Creative Officer Sam Reich:

Inclusivity is a top priority for us at CollegeHumor / DROPOUT. We don’t see nerdy topics as belonging to one group of people and not another. If you look at RPGs, for instance, there is a more diverse collection of people playing them now than ever before — and if you look at the cast of our RPG show, “Dimension 20,” it reflects that. If some bad fans of these topics have at one point alienated people, then it’s our job to create an environment that’s inclusive and supportive enough to win them back.

Of course, when you’re talking about streaming comedy, you also have to acknowledge Netflix, which is releasing new specials every week. CollegeHumor, in contrast, doesn’t really do standup. Instead, Rahmani said the company’s approach is “rooted in world-building sketch comedy — comedy layered with characters and storylines and elements that cross pollinate … a Marvel universe for comedy.”

Dropout launching on the web in a public beta test, with native apps to follow. It will start out at $3.99 per month before adding different tiers — Yyou’ll still be able to pay $3.99 per month after the beta, but only if you commit to an annual subscription. Otherwise it’s $4.99 per month with a six-month subscription or $5.99 month-to-month.

Even without a subscription, CollegeHumor fans will get access to some of the new content. Rahmani said the windowing policies (i.e., how long CollegeHumor waits before releasing a previously paywalled video for free) are still being decided, but there will be teasers released for each episode that should also work as standalone funny videos that are couple minutes in length.