A movie rating website valued at 1.6 billion? Netflix, Sony and Paramount all want to buy it.

Known as the "GoodReads of the film industry" and the overseas version of "Douban", the movie discovery platform Letterboxd may become the next sought-after company to be acquired. Its owner, Canadian holding company Tiny, is seeking to sell it at an estimated valuation of approximately $250 million through investment bank LionTree.

It is reported that multiple companies including Netflix, Sony Pictures Entertainment, Paramount Pictures, Versant, private equity firms TPG and Redbird, as well as Alexis Ohanian, Reddit co-founder, founder of venture capital firm Seven Seven Six, entrepreneur and investor, are in preliminary negotiations for the acquisition of Letterboxd.

In April this year, it was revealed that Letterboxd was also in talks with Versant, a subsidiary of Comcast, which already owns Fandango and Rotten Tomatoes.

This is not the first time that a film and video review website has been acquired by a large company. In addition to Fandango and Rotten Tomatoes, IMDb was acquired by Amazon.

Nowadays, the future direction of this user-centric platform is uncertain. One of people's biggest concerns is that if it is eventually acquired by a film studio, the buyer may interfere with the direction of film recommendations.

01

The bidding war kicks off

Netflix, Paramount, Sony, Versant, Reddit

In recent years, several major film review platforms in North America have all been acquired one after another.

Film review site Rotten Tomatoes has been part of NBCUniversal for many years, and its ownership structure has also been a point of criticism from some reviewers. Now Rotten Tomatoes and movie ticketing and streaming service platform Fandango have been integrated into Versant Media, which was spun off from Comcast/NBCUniversal earlier this year.

On the other side, film data platform IMDb is owned by e-commerce giant Amazon, providing service and data support for X-Ray, the interactive viewing feature of Amazon's Prime Video, which "displays real-time background information related to the current scene when users watch movies or episodes".

It is precisely because of this that Letterboxd, which is waiting for a good price, has become the bidding target of major Hollywood giants as well as private equity giants.

For Netflix, compared with the nearly $600 million it spent on Ben Affleck's AI startup Interpositive, this acquisition price is not expensive.

Michael Goodman, senior analyst at Parks Associates, believes that Netflix's recommendation engine is "good, but not good enough". Letterboxd can help the streaming giant improve its recommendation engine and help audiences find their favorite content among thousands of films.

Sony owns the Alamo Drafthouse cinema chain and has acquired a stake in Cosm, an ultra-wide-screen cinema company similar to Sphere, so it is accumulating a series of assets around loyal movie audiences. After acquiring Letterboxd, it can use the platform's data for market research and guide the production of its film series.

Paramount has been actively embracing technology and data, and is very interested in the discussions and user activities on this platform, and Letterboxd will provide a large amount of user insights. However, Paramount, which is in the midst of a large-scale acquisition spree, may lack the financial resources to complete this deal.

A senior writer pointed out, "In an era where technology is mostly used to provoke relationships between people and art, and between people, the popularity of Letterboxd is undoubtedly a rare good thing."

Therefore, he believes that companies such as Netflix, Paramount, and Sony want to acquire Letterboxd to seize control of power. This is also the concern of the platform's users about its acquisition: being acquired by these large companies may shake the platform's objectivity.

Private equity firms Redbird and TPG can effectively avoid the neutrality problem that plagues film companies, and better help the Letterboxd platform achieve profitability. However, as private equity firms, these companies are likely to vigorously promote the addition of various revenue-generating mechanisms. Subsequent moves to launch premium membership systems, license data, or introduce more intrusive advertisements may cause user resentment.

The reason why Letterboxd is so successful is that it promotes more discussions about movies, not just limited to the films released every week, without any preset stance. In the current turbulent Hollywood, where mergers seem to further shake up the landscape of film studios, this peculiar and fanatical corner of the Internet has become a safe haven.

No matter who ends up acquiring it, Letterboxd may become an important puzzle piece in the ecosystem of giants.

02

Letterboxd's $250 million valuation: membership subscriptions and advertising revenue

In 2023, Tiny acquired 60% of Letterboxd at a valuation of $50 million to $60 million. Letterboxd's co-founders Matthew Buchanan and Karl von Randow hold the remaining 40% of the shares. At the time of acquisition, Letterboxd was already profitable.

Buchanan said at the time that this transaction would not cause "any other changes" to the way the platform operates. It is reported that Buchanan has a veto right over any buyer.

Nowadays, it is revealed that Tiny is seeking a valuation of approximately $250 million through investment bank LionTree to find a new buyer for Letterboxd. In three years, the valuation has quintupled.

Foreign media pointed out in its April report that Tiny has held initial discussions with multiple potential buyers, including Versant and Hollywood startup The Ankler.

In addition, other reports indicate that Netflix, Sony Pictures Entertainment, Paramount Skydance, RedBird Capital Partners (an important financial supporter of Paramount), and private equity giant TPG are all considering joining the bidding. Alexis Ohanian, Reddit co-founder, founder and general partner of venture capital firm Seven Seven Six, is also reportedly conducting due diligence on the platform.

Letterboxd is a global social platform for movie enthusiasts, allowing users to discuss and discover movies. It was founded in New Zealand in 2011 by Matthew Buchanan and Karl von Randow. The platform allows users to log, rate, and review films, maintain a viewing diary, manage watchlists, create curated lists, and follow other users' activities.

The name "Letterboxd" comes from the term "letterboxing", which refers to the practice of adding black bars to the edges of the screen to maintain the original aspect ratio of a film.

This grassroots film review platform launched in 2013, which perfectly fit the digital environment that was democratizing film criticism at that time, forming a confrontation with the camp of traditional film critics.

Ali El-Sadany, editor-in-chief of film review site FilmSlop, commented that Letterboxd is "an app that brings together many voices, and most of the time it provides a platform for better works".

During the pandemic, the platform achieved explosive growth and has maintained strong momentum, laying the foundation for its strong influence. From January 2019 to January 2021, the number of users jumped from more than 1 million to more than 3 million. As of June this year, the number of users has grown to more than 30 million, spread across more than 190 countries. Its influence among young people is even more prominent — more than half of the platform's users under 35, including Gen Z, who are now strongly influencing the film industry.

The Daniels, the directing duo of *Everything Everywhere All at Once*, attributed the film's early success to the enthusiasm generated on Letterboxd. When A24's *The Brutalist* was released in 2024, it was reported that nearly half of the audience in its opening weekend learned about the film through the Letterboxd app.

Donna Langley, chairman of NBCUniversal, even referred to young film fans as the "Letterboxd generation" and believes that the platform has increased the rewatch rate of *Oppenheimer* in cinemas.

Many industry giants are themselves Letterboxd users, ranging from Sean Baker, director of *Anora*, to musician and actor Charli XCX.

Now, Letterboxd has been successfully applied to various film promotion activities, such as Letterboxd's popular video series "Four Favorites", which often invites A-list Hollywood stars such as Kate Winslet, Dustin Hoffman, and Uma Thurman to talk about their favorite movies.

The platform's profit model is mainly divided into two major parts: paid membership subscriptions and advertising revenue, and it is also exploring new revenue sources.

The platform is open to all users for free, but attracts users to pay for upgrades by offering premium features, such as an ad-free experience, personalized lifetime and annual statistics pages, filtering and selecting watchable content based on their favorite streaming platforms, and cloning other members' lists.

There are signs that Letterboxd is starting to convert its influence into actual transactions. The video store it launched last December mainly rents out some little-known or previously unreleased films. Eight days after Neon's Gen Z road thriller *It Ends* was launched on the store, Neon acquired the global distribution rights to the film.

03

What signal does Netflix joining the bidding send?

Before the news of bidding for Letterboxd came out, Netflix recently acquired Radford Studio Center, adding a large production facility to its business territory.

Netflix's renewed interest in transactions such as Letterboxd and Radford Studio Center indicates that it is committed to integrating more deeply into film culture and taking control of more production links.

In June this year, Netflix signed a contract with Radford Studio Center to acquire the center for nearly $400 million, after lenders led by Goldman Sachs foreclosed on the property.

This price is only a small fraction of the $1.85 billion sale price of the land in 2021, so Netflix has acquired production capacity at an extremely low cost.

Radford covers the production process of films, while Letterboxd captures the real thoughts of audiences after films are released. Owning both the front end and the back end will give Netflix an unprecedented feedback loop.

Combined with the news that Netflix has reintroduced free trials after a six-year hiatus, aiming to lower the threshold for new users, overall external analysis believes that acquiring Letterboxd means that Netflix will pay more attention to user engagement and content discovery.

Netflix already has one of the most advanced content recommendation systems in the world. It tracks your viewing history, including when you pause, how far you watch before you give up, and whether you switch to subtitles. All of this is behavioral data, implicit preference data.

The data of Letterboxd is essentially different. It is explicit, deliberate, preference data based on personal tastes. When someone logs a film on Letterboxd, rates it 4.5 stars, and writes a review explaining why, they are consciously expressing their preferences. This signal has no ambiguity. This difference is crucial for both recommendations and advertising.

The widespread external concern is that a film logging platform acquired by a streaming service will lose all its objectivity.

There is a lot of opposition to Netflix right now, but the acquisition makes the most sense if Netflix can manage Letterboxd the way Amazon manages IMDb. Amazon uses IMDb's data for personalized recommendations and targeted advertising, while allowing IMDb to maintain its core functions and user interface. It is this rigorous management approach that has allowed IMDb to continue operating successfully 28 years later.

04

Tailored for the younger generation?

Paul Hardart, director of the Entertainment, Media, and Technology Program at New York University's Stern School of Business, said: "The buyer will get three things at the same time — a media brand, a social network, and an audience research tool. Helping consumers decide what content to watch is almost as strategically important as owning the content itself."

Joost van Dreunen, a professor at New York University's Stern School of Business who studies entertainment platforms, calls Letterboxd a "plug-and-play platform" that provides the social layer needed to build loyal audiences around entertainment franchises.

Activities on the platform may also be helpful for film marketing. Marc Karzen, chief strategist of RelishMix, a company that analyzes the digital performance of film and television advertisements, said that small fan groups can generate tremendous value if their engagement and word-of-mouth can be integrated into promotional activities and ticketing decisions.

There are signs that Letterboxd is already influencing audiences. In 2025, users watched nearly 900 million films in total and posted more than 143 million reviews.

Paul Dergarabedian, senior media analyst at global box office tracking firm Rentrak, told Inc. magazine that Letterboxd has evolved from a boutique "insider-only" platform to a "virtual film town hall". He said that Letterboxd's curated content can bring attention to films that might otherwise be overlooked.

This article is from the WeChat official account "Yule Capital", author: Gu Yujia, editor: Yue Hong, published with authorization from 36Kr.