Work in most areas of corporate law may be moribund, but not every segment is kaput. One active segment is venture capital investments in high-tech startups.
Consider the deal 2080 Media Inc. of Atlanta just made for a digital media company developed at Turner Broadcasting. 2080 Media of acquired PlayON! Sports from Turner last month for undisclosed terms. PlayON produces and distributes Internet broadcasts of untelevised college and high-school sports events. PlayON’s clients have included the Atlantic Coast Conference and Raycom Media.
Because of a variety of factors, tech startups actually thrive during economic downturns, said DLA Piper partner Jeffrey M. Leavitt, who was involved in the 2080 Media-PlayON Sports deal.
“Resources, like office space and salaries, are cheaper now,” Leavitt said. “Big companies are not really focused on research and development in this period. So, if you’re a startup developing some technologies, when the economy recovers, big companies will be looking to acquire the technologies they didn’t develop themselves.”
Amgen, Apple Computer and Microsoft all went through their incubation phases during economic recessions, Leavitt said.
2080 Media financed its deal for PlayON Sports partly through a $3 million fund it raised from local investors, Leavitt said. Leavitt and colleagues at DLA Piper, including associates Brian M. Gordon and S. Kiran Lingam, advised the fund’s lead investor, Imlay Investments Inc. and a second investor group, Noro-Moseley Partners.
Another investor group, Buckhead Investment Partners, took legal advice from McKenna Long & Aldridge partner Michael J. Cochran and associate Bill C. Wainwright III.
Nelson Mullins Riley & Scarborough partners Donna K. Lewis and Brian S. Galison and associate Hemant D. Dutta represented 2080 on the acquisition of PlayON.