Inside 4KUniverse, The 4K HDR TV Network Newcomer Using Tech And Pixels to Disrupt The $380 Billion Global Industry.
June 27, 2020:
I slept in until 8:09am PDT this morning. It felt nice to get a good night’s sleep after a long work week amid the global pandemic. I brushed my teeth, weighed myself, walked downstairs, fed my dog, and pressed ‘Coffee’ on the Miele.
I step out in the backyard through white-colored french doors. 72 and sunny. Zero humidity. Beautiful, you kidding me? I feel like Kanye when he had to be in Wyoming to be creative or Brian Wilson living in Laurel Canyon to write new music. For me, Orange County is my current escape from LA where I had spent 13 years grinding. I casually walk into my home office and peek in my humidor to choose my afternoon treat. If I was sponsored, I would drop a name like Davidoff Grand Cru №2 or Sin Compromiso by Steve Saka. Yesterday, I enjoyed a nice Padron 1964 Anniversary Series maduro. I text “I love you” to my new wife who is visiting her mom in another part of Orange County. I am absolutely sore from head to toe thanks to my personal trainer I recently brought on. He happens to be one of my best friends from my Penn State days and he’s pivoted his own business with Zoom workouts. Fantastic — as he resides in Ardmore, PA. Will my college-age 6 pack abs return this summer? If I were a betting man, I would take the “double or nuth’n” and win. If I were a betting man, I would also say NASCAR releasing that image of the noose found in Bubba Wallace’s garage at Talladega Superspeedway indeed reveals, a noose.
OK, back to the 24-hour work grind…
Movies and Television
I moved back home to Boston after graduating college in Pennsylvania. Three months later in the summer of 2006, I told my parents I was moving to Los Angeles. When they asked “What, when!?”, I said “in two weeks.” Yes, I set out for Hollywood to start in the entertainment business. I was a talented filmmaker and thought I wanted to be a director. At the time, there was no “industry” in Boston and New York was mostly advertising. With a $5,000 loan from my Dad, little savings, and two suit cases, I flew to LAX. I made the leap of faith cross country with, wait for it, no job. No prospects, albeit one did arise. My Great Aunt’s extended family on her other side knew someone working in the distribution business in Hollywood and told me to call him. The only people I knew in the state were the Penn Stater’s I was going to “bunk” with in a 2-bedroom apartment in Sherman Oaks (the valley). I lived with one guy and three girls, slept on an air mattress for 6 months, and only ate salmon and rice from Costco, because it was cheap. I took on 3 unpaid entertainment internships simultaneously, one as the 2nd assistant to Steve Golin at a production/management company called Anonymous Content. They were known at the time for “Babel” with Brad Pitt and “Case 39" with Reese Witherspoon was in production. The second internship was for a company who put on Q&A events with actors at Grauman’s Chinese Theater to coincide with the movie’s DVD release. Right in the heart of Hollywood. I faintly remember Andy Garcia talking about “Oceans Eleven” and how he was directing his next movie in Cuba, saying “I just started filming and things went from there.” The third internship was the phone number I had in my pocket, the cell phone number of Mr. Paul Rich. Paul was in his late 60’s, early 70’s, and had a successful career with Bob Bennett at Metromedia before it was sold to Rupert Murdoch, which later became the cornerstone of the FOX Broadcasting network in the 1980’s. Paul also sold movies and TV shows overseas for Aaron Spelling, like “Dynasty” and “Charlie’s Angels”. Paul became my mentor. I used to pick Paul up at his house in Bel Air, driving up the hill from Sherman Oaks a couple times a week. He lived in the same neighborhood as Jay Leno, who serendipitously went to the same high school as me… Andover High in Andover, Massachusetts. To this day, I still haven’t met Jay. I gotta make that happen some time. I was doing Paul a favor as his chauffeur, so he didn’t have to drive on the bumper-to-bumper 405 freeway, but I also wanted to hear his old Hollywood stories. He once told me that while he was at MIPTV in Cannes, one of his clients brought a briefcase full of cash, we’ll call it $1 million dollars… I forget the amount, but a large sum, to pay for the rights to a big blockbuster Paul was selling. Paul instructed his staff to run to the nearest bank and deposit it.
So, I worked for free and learned at my three internships that summer and Fall and eventually Paul hired me as Coordinator, of International Sales. I didn’t even know what sales was. I was 22 years old. Remember, I thought I was going to become a film director. I was at the bottom of the totem pole. I remember on Day 1, they showed me to my office. I opened the door to a storage closet with filing boxes stacked up to the ceiling. I was told to hire a shredding company to clear room for my desk. I would do everything from licking 500 Holiday card envelopes, to manually organizing Sony Beta PAL tapes in the vault, to sending out DVDs of episodes of Bikini Destinations to clients in 90+ countries. The perks included learning the business, networking with people in the industry, exhibiting at the Palais des Festivals in Cannes, France twice a year, and, the Playboy Mansion. Yup, that’s right, I worked the celebrity V.I.P. limo line escorting stars up to the mansion. Once I was done, I would hop in the last limo with a buddy or two and enjoy the party. Models everywhere. Celebrities everywhere. People hooking up in bushes, people hooking up in plain sight. This one time for Hugh Hefner’s Halloween party, I went as a surfer and wore only a wet suit. I decided I was going to kick off the party by being the first one in the famous grotto. I jumped right in, went underwater, and emerged to EDM music and people hoot’n and holler’n. No one has ever said I lacked confidence.
I left Paul’s company after “paying my dues” for three and half years. I left voluntarily and left on good terms with Paul. I learned so much. It was incredible how much knowledge I absorbed from him, but I was still poor. That entire time I didn’t get paid a livable wage, even with my small commission percentage. I was hired by a production company as their VP and then later, the SVP, of worldwide distribution. I reported directly to the CEO. The famous story that only my close family and friends know, and disclosing for the first time, is that I closed a half a million dollar deal with one of the largest TV manufacturers based in South Korea off a cold call. I just straight up cold called their corporate office one day. I was 27 years old. That’s right, I cold called and formed a business relationship with them over a 6 month period when the 3D format was at its peak in 2010. I sold them a package of 3D TV series, 3D documentaries and 3D music videos. Guess how much of that $500,000 I received as the SVP, of Worldwide Distribution? Zero. Nothing. When that money hit our company’s bank account, the office went wild. Absolute excitement and disarray. My deal changed our company overnight. We were incredibly liquid. Clearly, I was upset when no commission or big bonus was given to me off the deal. I confronted my CEO and also the chairman of the company. I made a scene. The very next day I get an email from the Chairman of the company to meet him at the members-only Soho House in West Hollywood that afternoon. I showered, put on my best dark suit and tie, and drove there. I valeted my car, took the elevator up to the Penthouse level, and walked into the large room full of celebrities and Hollywood studio execs. I just kept my head straight so I didn’t recognize anyone. It felt like I was walking in slow motion because I knew this was a big moment in my career: I thought I was getting promoted to CEO. No joke, I really did. I sit across from the Chairman of the company and adjacent to him is a woman just staring at me. He begins to address the deal I had made, the money, and the whole situation. As he’s talking, the woman is introduced as the company’s outside General Counsel (Corporate lawyer). At this point, I’m still confident as hell. I’m getting a huge promotion. Or so I thought. He straight up tells me they are firing me on the spot. The woman lawyer starts talking like Anna Kendrick in ‘Up in the Air’ and places a NDA on the table and my severance package. I was totally fucking stunned. Imagine walking in thinking you’re getting promoted to CEO and they fire you instead. Hahah. Insanity! Apparently, I had made such a scene that it was disruptive to the company and I had butted heads with my immediate boss, the CEO of the company. I don’t even think I signed the NDA. At any rate, I was outta there. I think my entire severance was $10,000. So I made $10,000 off of $500,000. Fuck that. I was so fired up, you know what I did? I was determined to start my own shop and make a name for myself. I made up my mind in that very moment and that was it. To never let that happen again. That very same day I told my parents and brothers I got fired. I then drove to the Grove, the upscale, outdoor shopping mall in LA and bought a printer. Why a printer you ask? Well, I was going to start my own company the next day, so I thought having a printer was the first thing I needed.
In a matter of 3 months, end of 2011, with 5 years experience working in international content distribution, I made the leap of faith to start my own distribution company. You gotta have huge balls to go off on your own. You need to be fearless or else you will fail. I think I started Mance Media with only $25,000. That first year I worked my ass off, formally exhibited at MIPTV and MIPCOM with a booth, got press, and ended up making $300,000. I had never seen that kind of money in my life. I was 28 years old. Holy shit. I was “breaking into Hollywood” by selling TV shows internationally then got into releasing movies in AMC Theatres day & date with VOD in the U.S. Within a 18-month period between 2014 and 2015, Mance Media released 6 movies and hosted 6 red carpet premieres, Q&A’s, and after-parties in Hollywood. It was a time to be alive. I was on top of the world. What people outside of Hollywood don’t understand is… you need to break in before you can make real money in this town. You, as an executive or actor or director or producer, in a sense, become a currency that is able to be transacted. Without an exchangeable currency, you can’t conduct business in Hollywood.
Some Mance Media highlights:
- Actors in Mance Media-released movies included: Hannah Murray, Jessica Rothe, Ryan Malgarini, Haley Lu Richardson, Josh Brenner, Vanessa Ray, Mates of State, Joshua Malina, James Le Gros, Rachel Griffiths, Najarra Townsend, Tom Sizemore, Jack Falahee, and Noel Wells.
-Talent in Mance Media-distributed TV series included Alessandra Ambrosio, Irina Shayk, Ana Beatriz Barros, Half Pint Brawlers, Richard Branson (voice over), Kriss Kyle, Bikini Destination models, and Model Turned Superstar models.
-I attended the Sundance Film Festival, American Film Market (AFM) and Los Angeles Film Festival as a buyer and distributor.
- Mance Media licensed movies, including a Sundance Film Festival premiere, TV series, & documentaries to NETFLIX and to U.S. cable channels and to overseas broadcasters.
- Mance Media became a recognizable name within the global TV market.
During this time, I was living in the Hollywood Hills about a mile from the sign. I set up Mance Media’s office at Sunset Gower Studios on Sunset Blvd., one of the oldest studio lots with a rich movie making history. It used to be the home of Columbia Pictures and names like Harry Cohn, Frank Capra, and the Three Stooges. My office was in the famous writer’s courtyard. It was secluded and quiet. The courtyard is famous for making an appearance in the movie “Mulholland Drive.” Across the street is Gower Gulch, which evidently just got looted during the Black Lives Matters protests in May 2020.
Fast forward to early 2014, I was rolling. Money was coming in and Mance Media had a nice movie release schedule and a large TV library for international distribution. I had a meeting with an executive at Amazon at NATPE or MIPTV in Q1 2014, at a time when “4K” became the new buzzword overnight. The executive at Amazon asked me how many hours of 4K content I could deliver to Amazon Instant Video by June. I was totally taken aback by the question and blurted out 30 hours. I honestly didn’t even know what 4K was, but I was determined to find out. Sure enough, my entrepreneurial spirit that has always been within me kicked in and I was able to acquire, then license, 30 hours to Amazon by June of that year. I was hooked. I literally fell in love with 4K I wanted to know everything about it. It was an interesting time, because 1) The files were too big to deliver 2) Literally no 4K content existed and 3) internet speeds couldn’t support the big files without constantly buffering. As it’s written on the 4KUniverse website, our History shows that all of 2015 was R&D (research & development). It was intense. The entire year I grew a huge beard, still did my movie premieres with Mance Media, but on top of that, wrote the business plan for 4KUniverse. Trademarked it. Incorporated it in 2016. Acquired and produced 4K content. Built up a library. Through trial and error, perfected the infrastructure of the company, revenue streams, business models, video codecs, bitrates, frame rates, resolution, color depth, HDR, WCG, you name it. This period lasted from 2015 through 2017. 2018 to current day has been a waiting game to a certain extent, waiting for the market share of American households owning a 4K TV set to increase. As well, waiting for cable operators like Comcast and Charter to deploy new 4K-enabled set top boxes to their customers.
Cash Flow, Bootstrapping, & Equity
If you were to ask me what is the hardest part of running your own company, or two for that matter, I would say: managing cash flow. Cash flow is extremely sensitive as a start-up, and you constantly have to pivot, tweak and cater to, the cash flow. What is the proper allocation of revenue to live? To be married? to reinvest back into the business? To invest in employees? What about tech R&D? What about acquiring new shows for distribution? New movies? New content for the 4K network? Cash flow. is. hard. to. manage. It takes years to find the delicate balance between aggressively growing your business and conservatively protecting your downside (a methodology my Dad lives by). I have bootstrapped America’s first 24-hour 4K HDR Cable TV Network & UHD streaming service from the ground up, using savings, writing a solid business plan, finding great vendors, being creative, always glass half full, generating revenue (we are profitable year over year), and pure grit for the past 5 years. As the cartoon by 4KUniverse proclaims, “Screw this, Jack, we’re pulling the hatch!” As I write this article, I own 90% equity in 4KUniverse, Inc.
Disrupting the $380B Global 4K TV Industry.
From distribution via 5G, to being on 3 satellites covering much of the world, 4KUniverse is well positioned in the 4K TV industry as a mover and shaker. We are first-to-market armed with content, tech, infrastructure and vision. I plan to disrupt what is going to grow to a $380B industry by 2025. The 4K TV market enjoys CAGR (Compounded Annual Growth Rate) of 20% through 2025, including 4K hardware, software, and content.
As a leap year and The Year of The Rat, everyone had high hopes for 2020. But no one could have predicted a global pandemic, a federal quarantine with no heads up, a shutdown of the economy, 30 million people unemployed at one point, civil unrest, protests, and the stock market crashing leading to one of the worst recessions in our country’s history. At the same time, there are positives: In 2017, one in four American households owned a 4K TV. Now, 50% do (roughly 58 million households). 4K TV’s have hit critical mass for the first time in 2020. While there were no 4K resolution shows available in 2014, now there are plenty. They just cost money. The chicken and the egg situation no longer exists, a dilemma that was at the forefront of my mind when I started 4KUniverse. “How can I showcase the network in the new format with no 4K content?”
Light At The End Of The Tunnel
My goals for this year include raising a Series A equity round for 4KUniverse, Inc, and to launch the OTT side of the 4KUniverse business plan. The 4KUniverse cable network has been broadcasting 24/7 since February 2017. It is doing well and will eventually be carried by the big boys in the U.S. Hey, maybe I won’t have to raise a Series A if the OTT revenue explodes in Q4 2020? I don’t know, but a large cash infusion sounds nice and will be welcomed. After all, I am the master of my own destiny. I have skin in the game. I wouldn’t change it for the world.
Matthew Mancinelli is the Founder & CEO of 4KUniverse, Inc. and Mance Media, LLC. He is a Movie & TV Distribution CEO, 4K TV Channel Owner, Entrepreneur. He is from Andover, Massachusetts and enjoys golfing, skiing, and watching his New England Patriots dominate. https://matthewmancinelli.com/