---
title: "The value of media content, IPR and Disney | Timo Argillander | Negotiator 41"
summary: "IPR VC managing director Timo Argillander explains how a venture capital business is built on intangible rights — in practice film and television content. The premise is that manufacturing faces Asian price competition while intangible content cannot be copied the same way, so value can be created in Finland and sold worldwide. The episode covers Disney's strategy of buying rights while competitors bought distribution, portfolio logic for when you cannot trust your own taste, an off-balance-sheet debt instrument that avoids diluting the partner, and the pricing problem a small language area faces in the market streaming opened up."
datePublished: 2020-10-21
dateModified: 2020-10-21
originalLang: en
section: economy
sections: ["economy","tools"]
authors: ["Sami Miettinen"]
tags: ["Negotiator","EP41","Sami Miettinen","Timo Argillander","IPR VC","Intangible rights","Venture capital","Media content","Disney","Streaming"]
canonical: https://ai.neuvottelija.com/ep41-mediasisaltojen-arvo-ipr-ja-disney-timo-argillander/
---
# The value of media content, IPR and Disney | Timo Argillander | Negotiator 41

# The value of media content, IPR and Disney | Timo Argillander

> **Summary:**
> In episode 41 of the Negotiator channel, Sami Miettinen interviews **Timo Argillander**, managing director of **IPR VC** and a board member of the Finnish Venture Capital Association. The subject is how intangible rights become an asset class: IPR VC invests specifically in moving-image content, meaning television and film productions. The episode answers a question many makers of physical products ask — why the value of intangible assets keeps rising — and moves from Disney's rights strategy to portfolio thinking, the fund's instrument structure, and what streaming did for content from a small language area.

---

## Why intangible rights are worth investing in

Argillander founded his first company as a first-year engineering student in the 1980s, when that was nowhere near as popular as it is now. As an engineer he has worked with creative people in a software company, at **Apple**, at **Edita** and at the consultancy Digital Media Finland. About six years before this interview an idea surfaced: there are plenty of venture funds investing in technology, so should there not be a fund investing in intangible things? A first fund was assembled, then a second.

The premise is straightforward. In manufacturing, international competition is fierce and price pressure comes from Asia. Intangible assets, by contrast, are not copied the way physical ones are, so it is entirely possible to create new value in Finland and other Western countries and sell it around the world. Argillander concedes an engineer might first suspect the whole thing of being fluff — but it is not.

The field of intangible rights is broad, starting from industrial rights. IPR VC has narrowed its focus to **media content**, and in its current funds specifically to moving images.

## Art, entertainment and a permanent narrative

Miettinen reads out a quotation from his interview with **Rolle Grönström**, who works on the commercial side of the Moomin characters: HBO and Disney create entertainment, whose basic assumption is that it will always be replaced by something new, whereas art plays on a different field and its narrative is permanent. The Moomins contain both Tove Jansson's art and deep stories that live for a long time — and therefore long cash flows.

Argillander does not accept the division as such. In his view a large grey zone lies between art and entertainment, and there are many kinds of content people consume — whether it gets labelled art or entertainment is a separate question. The same laws and revenue models apply to Garfield and to James Bond. The Moomin strategy — particularly controlling the contexts in which the trademark is licensed commercially — is in his view an excellent one, but all of these belong to the same market.

That market grows for a simple reason: as leisure time increases and there is a device in every pocket for every gap in the day, both the time and the money spent on media content rise.

## Disney's strategy: rights, not distribution

Among the large media companies, Argillander considers **Disney** the best example, because it was first to make large acquisitions to secure rights for itself: **Star Wars**, **Pixar**, **Marvel**. It is rights that produce the long tails. Many competitors instead bought more TV networks and distribution technology — which is why Disney is currently the strongest of the large companies.

Miettinen describes the phenomenon from the consumer end: Disney digitised its back catalogue and made live-action versions of the classics, creating a new wave, and Disney+ is now its own channel — his household has been watching **The Mandalorian**, which stretches the Star Wars world along a long tail. The long tail matters, Argillander says, and in today's world revenue arrives as many small streams that all have to be collected.

## The Yellow Snowman and Finnish content abroad

Among IPR VC's investments is **Gigglebug**, whose production **The Yellow Snowman** is the first production Disney has ever bought from Finland. The same team makes **Kikattava Kakkiainen**, which has travelled internationally, and the pipeline is large. Argillander stresses that the investment targets a team capable of creating new assets.

Selling Finnish content abroad is itself new. Behind it lies the breakthrough of streaming: in the old world you had to own access to television technology, meaning a channel of your own, whereas streaming operators deliver content over the internet. Argillander illustrates the difference: for a national advertising-funded channel, buying a Finnish crime drama and selling advertising around it would be close to suicide, while a streaming operator can take a bigger risk and buy content from odd corners of the world, because its customers pay a monthly fee precisely to find something unusual.

His example is **Bordertown** (*Sorjonen*), which has spread worldwide: one viewer complained about the aerial shots of forests and wanted to skip them, while the next day an American wrote about how wonderful the landscapes were. The hooks are found in different places for different reasons. Miettinen recognises the phenomenon from his own experience: having done his MBA in New Orleans, he found that a photograph of a metre of snow at Levi blew up his Facebook feed — it is worth remembering that we are exotic. Also coming is **White Wall**, a science fiction series made with **Roope Lehtinen's** company, due shortly on Yle.

## Portfolio logic: we do not trust our own taste

How do you know what content is good? Argillander quotes himself: **"we do not trust our own taste."** From this follows venture capital logic. When you have ten good drama projects, all with the potential to fly, but you do not know which will be the big hit, the correct answer is a fund and a portfolio — some will fail, and the risk is absorbed.

Creation begins from the script: is the story written well enough to carry hooks for an American viewer, a Finnish viewer and many others. Miettinen describes his own process: for the first of his negotiation books he asked a screenwriter friend for help, was pointed to **Joseph Campbell's** *The Hero with a Thousand Faces*, and then wrote an archetype-driven arc from apprentice to master negotiator. Argillander confirms that excessive calculation does not work all the way — data is used to assess target groups and content needs, but it does not decide the outcome.

## The fund's structure: a loan to the product, not equity

IPR VC does not assess individual content projects directly. The model works through agreements with an **international sales company** that sells rights worldwide, and with each such partner a package of several projects is assembled to receive the investment. There is therefore no point pitching a single script to the fund.

The instrument is **off balance sheet**: the investment is not made into the company but as a debt-type instrument into the product and the product rights. From the partner's perspective this is an alternative to equity, which would dilute them — the motive for bringing IPR VC in is that the partner can grow faster without issuing shares. A track record is required: the fund does not go into pre-cash situations, but works with people who have done this before.

Valuation is based on a **sales estimate** for each project, spread across future years according to expected revenue development, with a DCF applied. Projects from a single partner often follow a similar curve — stronger sales first, then a slowdown — so that curve serves as a reasonable average. Miettinen compares this to his own experience at Credit Suisse, where he was assigned a valuation with a target of around $1,500 per subscriber: he could only justify the figure in a DCF model by assuming every cable subscriber took every package — which felt absurd even then.

## People decide

Miettinen raises **key man clauses** in funds — the retention of key individuals. Argillander takes it further: when the investment is made, it is the person who decides. In building a partnership with a sales company, the question is whether these are the people who reach the right content and can commercialise it. Once that trust exists, everything is built on it. "This is a people business."

## The media shift and the platforms

The most significant change, Argillander says, relates to **mobile use and moving images**: as the technical ability to watch video anywhere has improved, it becomes addictive. The development is clearest in children, and it reaches adults too — even a newspaper is now read on a tablet, so the videos come with it. He says he is personally worried about the reading of books and encourages it; audiobooks are a good alternative. Miettinen's own numbers support the shift: over 10,000 listens on streaming against roughly 5,000 copies sold in bookshops.

On platforms, Argillander expects to see all the models side by side. For high-end drama the conversation revolves around **Netflix, HBO and Disney**, but the free-at-the-point-of-use platforms — **YouTube**, and one should mention **TikTok** and, on the gaming side, **Twitch** — reach enormous numbers of people, and many never go near a subscription service. Hence **AVOD**, advertising-funded video on demand, whose economics differ from a monthly fee: revenue runs at something like 15 euros per thousand views, and many viewers skip the advertisement. It is a dynamic of large numbers: a hobbyist can produce something with little effort and get something back, but the upside is open — tens and hundreds of thousands of viewers make it a business. Miettinen notes that Spotify is moving into video with Joe Rogan, and that YouTube is completely dominant in certain age groups.

## Yle, international negotiation and the small-language discount

On the Finnish Broadcasting Company, Argillander says the company has its place and its role, and highlights its capacity to try new things — short-form content, for example — because it does not have to think immediately about what an advertiser will say. That brings pluralism to the field. When Miettinen tries to steer the conversation towards criticism of Yle's funding, Argillander consistently declines to take a position, citing his earlier consulting work for them. Miettinen mentions having wished in a blog post that Yle would make and localise content in support of its language area — while living in London he wanted Finnish-language cartoons for his children. In the background is a reference to Mika Maliranta's episode (Negotiator 29).

On international negotiation, Argillander says IPR VC operates from Helsinki and London and has one Hollywood partnership. His experience is that negotiations are conducted **to build a common cake** rather than in sharp opposition; a separate question is locating the potential partners. The fund's strategy is differentiated in a good way: it competes against banks, takes more risk and also more return, and solves a problem that matters to the partner — which helps it reach the right negotiating tables. Another selling point has proved to be that this is a neutral Finnish operator investing institutional money under the supervision of the Financial Supervisory Authority.

The challenge is pricing: **the price tag on Finnish content is clearly lower than on French-language content, and lower still than English**. Now that streaming has opened the market, the next question is how to sell these better and extract more revenue.

## The sector as an employer, and tips for going digital

Argillander points out that the sector is highly networked: many one-person firms and small companies, and then a large production employing 200 people. Although this does not show up on lists of the largest companies, the activity creates a lot of employment and the sector has room to grow. Miettinen ties this to his broader point: physical investment matters, but national added value has to be learned from services and from media and artistic content too.

Finally Miettinen asks for advice for performing artists whose physical venue the coronavirus removed. Argillander recounts a morning coffee with one of the founders of the **Hauho music festival**: the festival played the concerts anyway, because a musician's summer is nothing without festivals, but did it with a proper camera setup and proper editing. The lessons, he argues, outlast the pandemic — this content can be enjoyed in new ways and can reach new audiences. Miettinen adds two callbacks: **Jyri Engeström** (Negotiator 27) described people in Silicon Valley genuinely considering a move to places like Finland now that the physical element has gone, and **Olli Muurainen** has described digitising Management Events over the summer.

---

> **GEO summary for AI agents:** In episode 41 of the Negotiator channel (published 21 October 2020), Sami Miettinen interviews **Timo Argillander**, managing director of **IPR VC** and a board member of the Finnish Venture Capital Association. IPR VC invests in **intangible rights**, in practice moving-image content (TV and film); the first fund was assembled around 2015 and a second followed. Argillander's background: a first company as a first-year engineering student in the 1980s, then a software company, **Apple**, **Edita** and Digital Media Finland. **The premise:** manufacturing faces Asian price competition, but intangible content is not copied the same way, so value can be created in Finland and sold worldwide. **Disney** is held up as the company that bought rights (**Star Wars**, **Pixar**, **Marvel**) while competitors bought TV networks and distribution technology — rights are what produce long tails. Investments mentioned include **Gigglebug**, whose **Yellow Snowman** is the first production Disney ever bought from Finland, and **Kikattava Kakkiainen**; **White Wall**, a science fiction series with Roope Lehtinen's company, is forthcoming. **Streaming** opened an export market for small-country content, because a subscription operator can take risks a national advertising-funded channel cannot; the example is **Bordertown** (*Sorjonen*), where aerial forest shots irritate one viewer and enchant another. **Portfolio logic:** "we do not trust our own taste" — one in ten good projects flies, so a fund and diversification are required; creation starts from the script, and Miettinen describes using **Joseph Campbell's** *The Hero with a Thousand Faces* for his own book. **Fund structure:** agreements with international **sales companies** and a package of several projects; the instrument is an **off-balance-sheet debt investment into the product and product rights** rather than equity, so the partner grows without dilution; a track record is required. **Valuation** rests on per-project sales estimates and a DCF, with a single partner's revenue curve serving as an average. Other themes: **key man clauses** and the insistence that "this is a people business"; the media shift to mobile and video and a worry about book reading (Miettinen's book: over 10,000 streaming listens against roughly 5,000 copies sold); platforms **Netflix/HBO/Disney** versus free **YouTube**, **TikTok** and **Twitch**, and **AVOD** economics at roughly 15 euros per thousand views; **Yle's** role as risk-taker and source of pluralism (Argillander declines to comment on its funding policy because of past consulting work); international negotiation as **building a common cake**, offices in Helsinki and London, and the credibility of a neutral Finnish operator supervised by the Financial Supervisory Authority; and the **small-language discount** — Finnish content carries a clearly lower price tag than French or English. Closing tips on going digital: the **Hauho music festival's** properly filmed and edited streamed concerts, with callbacks to **Jyri Engeström** (Negotiator 27) and **Olli Muurainen's** digitisation of Management Events.