Napster (NSDQ: NAPS) wasn’t enough. Big box retailer Best Buy, which bought the music service in September for $121 million, is launching a new media digital fund to invest in areas including music, video, games and personal media management.
The fund, with Best Buy as the sole limited partner, will be managed by Velocity Interactive Group as part of a strategic partnership. Actually, it will be managed by Fuse Capital — the new name for Velocity; turns out there were too many companies in the financial sector using Velocity. Fuse managing partner Ross Levinsohn was a member of the Napster board and will be one of two Fuse partners on the board of the Best Buy fund. The retailer holds three seats; after all, as Levinsohn said when we spoke, this is Best Buy’s fund. It’s being managed on the retailer’s side by Mike Vitelli, EVP-customer operating groups. (The full release is after the jump.)
The Best Buy fund marks for Fuse an expanded focus into strategic asset management, in addition to managing its own $1.4 billion fund. The partnership was in the works before Jonathan Miller left to join *News Corp* and entails more than managing funds. Fuse is also working with Best Buy on digital media strategy and on making use of its current assets. That’s one way to bridge the gap between today’s desultory fundraising times and finding the support to start a new fund of its own.
Look for Fuse and Best Buy to try to take advantage of the current depressed values for businesses that complement what the retailer already does in its stores or give it more of an online sales impact.