Columbus Nova: 5 Fast Facts You Need to Know

hulk hogan and gawker

Terry Bollea, aka Hulk Hogan, won a lawsuit against Gawker. Columbus Nova invested in Gawker to help with legal expenses. How will the ruling affect Columbus Nova’s control of Gawker? (Getty)

Columbus Nova bought a minority stake in Gawker while the company was facing the specter of a huge lawsuit from Hulk Hogan. The exact amount that Columbus Nova purchased was not disclosed, although the purchase did give the company a seat on Gawker’s board along with veto power over certain key decisions. Columbus Nova is the U.S. investment arm of a huge conglomerate owned by a Russian billionaire. Who is Columbus Nova and what kind of role could they play in Gawker’s future, now that Hulk Hogan was awarded $115 million by a jury for compensatory damages and $25 million for punitive (including $15 million in punitive from Gawker)?

Here’s what you need to know.

1. Columbus Nova Bought a Minority Stake in Gawker to Help with Legal Fees from Hulk Hogan’s Trial

nick denton columbus nova

Nick Denton, founder of Gawker, talks with his legal team before Terry Bollea, aka Hulk Hogan, testifies in court. Denton sold part of Gawker to Columbus Nova. (Getty)

Gawker has been majority owned by its founder, Nick Denton, since the business started. For the very first time in January, Gawker accepted an outside investment from Columbus Nova in order to help secure funds for the case, The New York Times reported. According to its website, Columbus Nova was founded in 2000 and is a multi-strategy investment firm that manages over $15 billion in assets.

The exact stake that Columbus Nova has wasn’t revealed by Gawker because of the trial, The Wall Street Journal reported, except that it was a minority stake. According to Politico Media, the investment did give Columbus Nova veto power over key Gawker decisions, including the hiring and firing of executive officers, approval of an annual budget, executive pay raises over 30 percent, and selling the company for anything less than $100 million.

Jason Epstein, managing director of Columbus Nova, also got a seat on Gawker’s board of directors.

A leaked internal memo revealed that Gawker needed the investment to build up its “war-chest” in light of the Hulk Hogan lawsuit. Denton told Fortune, regarding the purpose of the outside investment:

It’s about putting Hogan behind us, and the future ahead of us.”

Denton has previously said there was a 1 in 10 chance that he would have to sell a controlling stake in Gawker in order to keep it afloat after a verdict, The New York Times reported.

2. Jason Epstein Said He Had No Plans to Oversee Gawker’s Editorial Decisions

speaks onstage at the New Yorker Festival 2015 - Tech@Fest: Cyber Privacy at One World Trade Center on October 3, 2015 in New York City.

Nick Denton (far right) attends The New Yorker’s Tech Fest in October 2015. Jason Epstein has said he has no plans to take over editorial control of Gawker from Denton. (Getty)

Jason Epstein, managing director of Columbus Nova Technology Partners, told Fortune that he had no plans to get involved with Gawker’s editorial side. Similarly, Denton said that Columbus Nova was committed to editorial integrity and Epstein had deep experience in media and entertainment and was already providing valuable advice.

Epstein said the Hogan lawsuit didn’t worry him at all and he was glad for it because it created Columbus Nova’s investment opportunity.

(Note: Some sources say that Columbus Nova invested in Gawker while others say it was Columbus Nova Technology Partners. Both share the same logo and are part of the same company. Epstein is managing director at Columbus Nova Technology Partners and Managing Partner of Columbus Nova.)

3. Columbus Nova Has Invested in Many Other U.S. Technology Companies

Gawker isn’t the first U.S. tech company that Columbus Nova has invested in. In September 2013, it invested a significant amount in online music service Rhapsody International. At that time, Rhapsody president Jon Irwin stepped down. In February 2015, Columbus Nova acquired Sony Online Entertainment from Sony. It renamed the company Daybreak Game Company and cut a number of key staff positions, but would continue to produce EverQuest and other popular games.

4. Columbus Nova Is the U.S. Investment Arm of the Renova Group, Founded by a Russian Billionaire

Columbus Nova is part of a much larger investment group, according to Fortune. It’s the U.S. arm of the Renova Group, which owns Rhapsody, the former Sony Online Entertainment, and other tech companies. Russian billionaire Viktor Vekselberg founded Renova. Renova is a huge conglomerate that has investments in mining, financial, construction, chemical, and housing industries.

Fortune asked Denton how he felt about having a Russian billionaire as an investor in Gawker. Denton said, “Do Brooklyn Nets fans have concerns that the NBA team is owned by Mikhail Prokhorov?”

5. Gawker Once Described Viktor Vekselberg as a ‘New York-Lovin’ Russian Oligarch’

Back in 2008, long before Gawker was considering selling part of its company to Vekselberg, it published a story about the Russian multi-billionaire who has a net worth estimated to be around $18 billion. Gawker wrote about how Vekselberg was spending a lot of time in New York, like many other Russian billionaires, and owns multiple properties in the U.S. In 2004, he purchased the famous Faberge egg collection of Malcom Forbes for about $100 million.

Vekselberg, born in the Ukraine, rose to power by heading one of Russia’s largest oil and gas companies, Tyumen Oil, and partnering with BP in the late 1990s, International Business Times reported. He sold his 50 percent stake in TNK-BP for $28 billion and became Russia’s richest man. He still heads Renova Group and was appointed by former Russian president Dmitry Medvedev to oversee development of Russia’s Silicon Valley, Skolkovo.

In 2013, he told Esquire: “In Russia, or anywhere, people don’t like rich people. Yeah, OK, I have money, but the question is how I use it. It’s not easy, believe me, it’s not easy.”

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