This news has been simmering for a while. When Ross Levinsohn (pictured left) resigned as the President of Fox Interactive Media late last year it was rumored that he intended to raise a large fund to acquire Internet startups. He soon partnered with Jonathan Miller, the former Chairman and CEO of America Online and the two have been out raising capital for the last few months. Their new entitiy is called Velocity Investment Group.
They’ve found their partner - $15 billion hedge fund General Atlantic. Details on the amount of capital committed to the new fund are scarce, but General Atlantic issued a press release today announcing that Levinsohn and Miller have become advisors to the fund. The timing is interesting - 5:14 pm EST on the Friday before the long weekend. The press was circling on this story, and the release was obviously made to preempt the news from breaking.
More news should be coming next week as details leak - size of the fund, etc. The new venture will compete with Demand Media and others for acquisitions. Demand Media, which has raised $220 million in capital, was founded by former Intermix Media CEO Richard Rosenblatt. Ironically, Intermix Media, the parent company to MySpace, was acquired by Fox during Levinsohn’s tenure there.
Update: We beat the WSJ by 16 minutes on this one. Their story is here.