It hasn’t been an easy ride for AIM-quoted Brave Bison Group PLC (LON:BBSN) over the past couple of years.
The company has struggled to turn a profit having expanded too quickly, losing focus along the way.
The quality of the product has never been in doubt though. Just ask the raft of blue-chip companies – Shell, HP, the PGA Tour – Brave Bison counts among its customer base.
Three pillars to the business
So what does the firm do? Essentially it is a digital social video company, working with brands and organisations, like those above, to help them build and engage audiences through the use of media.
It has three main prongs to its business, the first of which is strategy.
Brave Bison says it is its job to “understand how video on the internet works” and it uses this knowledge to advise brands and companies on why they should create video, who they should create it for and how to execute it.
Up next is origination, where it helps to bring those initial ideas to life – overseeing the whole production process from filming right through to editing.
Its “secret weapon” is Yellowstone Studios, a custom-built content studio located in Hoxton, a creative, trendy area in east London.
Obviously, there’s little point in creating great content if no one is watching it, which leads on to distribution, the final piece of the puzzle.
A lack of viewers is unlikely to be a problem though, with Brave Bison’s various social media channels racking up 13.5bn views in the April-to-June quarter earlier this year.
To put that into perspective, that figure made Brave Bison the fourth biggest media producer around the world during those three months.
End-to-end service to rival WPP
While companies can come to Brave Bison and ask for help with any one of those aspects – strategy, origination or distribution – the company believes its real selling point is that it can do all three.
“We can provide an end-to-end service which I think is the really interesting thing about Brave Bison,” chief executive Claire Hungate told Proactive Investors.
“When I look at our competitors, there are very few of them unless you want to go to the WPPs of this world, where you’re going to seven or eight different agencies to get what we can provide within one business.”
Hungate has been at the helm for less than a year, having headed up the UK TV and content production arm of Warner Bros, which used to be known as Shed Media until it was taken over.
Refocused under new CEO
Almost immediately she made some bold decisions, closing eight offices around the world and bringing the group’s headcount down to around 70 from over 300, measures which helped to knock £4.5mln off the cost base.
Almost immediately, the cost cuts had an effect, with Brave Bison turning a small underlying profit in the first half of 2018, and it is on course to reach profitability by the fourth quarter of this year.
It’s not all been about scaling back though, rather Hungate and her team are making sure they are focusing their investment in the right areas, one of which is the Asia Pacific region.
The company has kept its office in Singapore to take advantage of a potentially lucrative market, where it sees little competition and where brands are only just starting to fully understand the benefits of social video.
“Digital penetration is huge in Asia Pacific but actually the use of social video by brands is a little bit behind the curve compared with Europe and North America,” Hungate said.
No need to raise money at the moment
On top of Asia Pacific, Brave Bison plans to invest more time and money into its owned and operating channels.
It currently has 18 of these, although it is soon to launch two more: Mutha, a sustainable living channel, and Perk, which will focus on work and careers for millennials.
“What we’re creating are brands, communities – these are the new TV networks. If BBC and Channel 4 want to know where their 16-25-year-old audience has gone, well they’re online and they’ll be watching our channels,” the CEO added.
The idea with these channels is not just to build a significant following and rake in the ad revenues, but to create renowned platforms, for which companies will pay a handsome sum to place their content on.
“What brands want are known distribution channels, they don’t just want to have (their content) working its way around the internet and not know where it’s going to end up.
“They want to work with companies like Brave Bison who own their own distribution networks, so they know who their audience is and know what the tone of voice is of that channel.”
Those initiatives sound like they could be expensive but Hungate is adamant the firm, which had £4.2mln in the bank at the end of June, can afford these investments without having to tap up shareholders for some more cash.
“We feel we have the cash reserves to invest in (those initiatives) using our cash reserves without having to go to the market and raise more money.”
As for where she wants Brave Bison to be in a year’s time, the answer is simple: “Sustained profit.”