Boston Omaha's Link Media Gets More Funding (Issue #79)
When I attended my first Boston Omaha annual meeting in November 2021 it was quite intimate which allowed for a deeper dive into what we as investors wanted to learn more about. The questions were on point, but I remember one that stuck out from the rest, it was something like, “I have a great appreciation for your strategy and operational ability, but it pisses me off when you do a private fundraising round at a below-market valuation…” It was less of a question and more of a critique, but in light of the recent (at the time) discounted cash influx it seemed like an important issue to address. The response by the Co-CEOs basically said that their main priority was optionality. They didn’t want to feel that at any moment they couldn’t quickly and effectively capitalize on an attractive opportunity. This notion led them to raise capital they thought was necessary. While I do not condone that form of fundraising always it can make sense especially when you are a smaller enterprise competing against some big players. For example, their billboard subsidiary, Link Media, is the 6th largest in the US.
Link operates in more niche and rural environments, but has been steadily growing thanks to investment and reinvestment by Boston Omaha. However, the company is still a distant 6th by number of billboard faces. In the US the only way for billboard companies to grow is through acquisition. Link has successfully acquired mom-and-pop billboards and even closed some larger deals. In order to continue more funding is necessary. This is why it is exciting that they have been able to increase their revolving line of credit from $5m to $10m. This type of credit is especially useful in our current high-interest-rate climate.
Watchlist Updates:
Portfolio Updates:
Until Sunday,
Soren