Media-for-equity gains ground as startups face funding crunch
Mercurius Media Capital is offering a media-for-equity model in the US that allows startups to access large-scale advertising inventory in exchange for equity stakes. This approach aims to alleviate the financial pressures on consumer tech startups caused by declining venture capital funding.
Funding climate
Startups have faced tighter investment conditions in 2025. Global venture capital funding dropped to around USD $17 billion in August, marking the lowest monthly total since 2017. This figure represents a 12% decline year-on-year and a 44% month-on-month drop. Venture capital deal volumes in the UK also saw a significant downturn in the second quarter, registering the slowest pace of investment in five years.
The reduction in available capital has made it challenging for early-stage companies to finance the advertising campaigns necessary for initial growth. Many of these businesses have sought alternative finance structures to grow their customer base while preserving cash flow.
Media-for-equity approach
Mercurius Media Capital, which was established in 2023, addresses this need by supplying high-impact advertising slots on major networks such as Sinclair Broadcast Group, TelevisaUnivision, and Atmosphere TV in return for equity stakes. The fund has allocated nearly USD $30 million in media inventory across its portfolio, which includes emerging companies in the consumer technology sector.
"At MMC, we see media-for-equity as a catalyst for shaping markets, not just growing companies," said Piyush Puri, Founding Partner, Mercurius Media Capital.
Recent investments
This year, MMC has backed Mode Mobile, RYSE, and reAlpha using its media-for-equity model. In May, Chicago-based Mode Mobile received a USD $1 million investment in targeted media campaigns, with the option for an additional USD $2 million. The company offers "EarnPhone," a product that converts customer smartphone use into rewards, seeking broader recognition and market share in the "earn as you go" mobile segment.
In April, MMC allocated USD $2 million in media inventory to New York-based RYSE, which sells solutions for retrofitting homes for smart automation. The investment consists of placements across television, digital, and outdoor advertising, intended to boost RYSE's customer base and sales in the US.
"This partnership is a major milestone for Ryse. With MMC's media support, we can tell our story at scale and accelerate our vision of making smart shading a standard in every home," said Trung Pham, CEO, RYSE.
MMC also made a USD $5 million media-for-equity investment in Ohio-headquartered reAlpha, which operates a commission-free homebuying platform. The company expects this deal will enhance its profile, drive user acquisition, and support fundraising efforts by leveraging MMC's network and knowledge of the US market.
International precedent
While the media-for-equity structure has been in use in Europe, with funds like Channel 4 Ventures in the UK and Aggregate Media in Sweden, MMC is the first to bring the model to scale in the US. Startups including Uber and Airbnb have used similar deals for market expansion outside the US. MMC's early transactions are cited as evidence of this approach gaining traction in North America.
MMC states that combining media expertise with growth investment offers differentiation from traditional venture capital. As alternative financing techniques emerge and more brands seek to maximise returns from media assets, media-for-equity options look set to play a greater role in startup funding strategies.
"At MMC, we see media-for-equity as a catalyst for shaping markets, not just growing companies," said Puri.
