• by Erik Sass  @eriksass1, November 8, 2007

A new company, Connect Outdoor Media, is funneling venture capital dollars to independent out-of-home networks, allowing them to scale up operations and improve their infrastructure to compete with "the big three" of outdoor advertising--Clear Channel, Lamar, and CBS. Connect, owned by Fusion Media Group, works by purchasing majority interests in independent operators which then become affiliates, beginning with Texas-based Genesis Media Advertising last month.

Connect's funds come from venture capital firms like Key Ventures Partners, whose first investment of $7.5 million is being used by Genesis to upgrade existing displays and build new ones. In the future, Connect sees other independent operators using venture capital funds to implement new technologies including installing digital billboards, currently a key driver of outdoor revenue growth.

According to Connect executives, the company is in talks with a number of outdoor advertisers about purchasing a majority stake in their companies. Generally, Connect's strategy calls for keeping the local management of an independent operator in place; thus, Greg Caton--the founder of Genesis in Texas--transitioned into a role with essentially equivalent responsibilities as a local general manager for Connect.