Online karaoke and contest site Bix has signed an agreement to be acquired by Yahoo! Bix CEO Mike Speiser will continue running Bix but will also take on responsibility for product management for Yahoo! Groups, 360, and Photos under the title VP of Community.
Speiser was previously the founder of Epinions. Epinions was acquired by Shopping.com (then DealTime.com) in 2003, which in turn was acquired by Ebay in 2005. Epinions had an estimated valuation of $30 million at the time of acquisition. The terms of the Bix acquisition weren’t disclosed but it was probably for much less than Epinions; Yahoo! was rumored to have paid $15 million for online video editing company Jumpcut last month. Bix probably got a little less than that but Yahoo! got a seasoned social media man to put in charge of a number of product management at the company’s most social products.
Bix is a 16 person company based in Palo Alto. The company was founded in January and went live in August. They report 1 million unique visitors since launch. They have raised $6.77 million from Sutter Hill Ventures, Trinity, and others. The terms of the acquisition aren’t being disclosed. Our previous coverage of Bix is here.
Bix has built a community of users by offering prizes of up to $50,000 in its contests. Contests are set up by the site, but others are created by users. Those contests include not just karaoke but everything from beauty contests to comedy, dance, a cappella singing and photo competitions. Those contests can be public or private. Each are wrapped in targeted advertising and there’s a strong mobile component. The site has some basic community features and an “easy upload to MySpace” tool.
Speiser says that Bix will maintain it’s current site under Yahoo ownership and the team will move to Sunnyvale. Speiser says that “in the coming months, we’ll offer more customization and atomize the contest tools so that you can run contests on your blog or Myspace page or corporate web site.”
Fox has it’s own karaoke site in kSolo and something tells me that every time anyone sings in the shower we’re contributing to the grand Google karaoke database.
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Bix sucks.
On a different note, Bix ROOOOOOOOOOOOOOOOOOOOOOOCKS!
Congratulations to the Bix guys!
I have been waiting for Youtube to do the same. I think they better hurry up. We just started a similar approach, but just with questions through audience-directed interviews. You can see one of our sessions here: http://www.tricycle.zooleo.com.
If these things are easy and fun, I think they will do well. People want more involvement in their media, and think this is a good move by Yahoo.
this site is lame. why would you put a blank vs. blank format to a contest. also, why are there contests for photographs, lip sync etc….why not a contest for who sheers sheep the best? it’s all over the map.
How can someone take $6.7M in venture capital and sell for less than $15M. Wouldn’t the liquidation preference clause kick in and assuming it say something common, take all the money off the table?
Anyone else have other rumors for the size of the deal?
wow. congrats to Mike, Leonard, and the rest of the team over at Bix
Congratulations to Jamie and the rest of the team at Bix.
Quickly built and quickly acquired.
Not sure if I understand the acquisition but I’m happy for the team!
Have you seen the new SERP Search engine results pages on Yahoo.
There is after the 10th result a message saying Shared by Yahoo with more results from Answers.
I just tried out Bix and was entertained with the NBA matchups. I got hooked fast and I’ll try it again later tonight.
Congratulations on the deal.
Yahoo! is never going to create shareholder value by making these pointless acquisitions.
Which direction Y wants to go with all this crap?
I’m really stoked with this purshase! It validates the fact that there is value in the ‘Online Video Contest’ arena. Makes me feel better knowing that the time I’ve spent in the past 5months developing a simalar site Next Webstar is well worth it. We are currently wrapping up development and hope to be live the first or second week in December.
Check out our NEW Flickr development site: http://flickr.com/photos/nextwebstar
This is definitely a strange acquisition from Yahoo! Especially after it seems Yahoo! put so much effort into their Talent Show – will Bix replace this or vice versa?
I did have the opportunity to beta test Doug’s NextWebStar and I think this does definitely prove to validate this new realm of people who will compete to claim, “I am famous on the internet”.
Now that YouTube is a star, is the next big thing being the next big thing? I am excited to see what comes up; I doubt Bix will prove much with respect to popularity. However, up and comers to the market such as NextWebStar will definitely prove as exiting and competitive as their members!
The user-gen contesting space is getting crowded. Last week Comcast launched Ziddio - http://www.ziddio.com.
Moneybags: Yes, a sub $15 million acquisition of a company that received $6.77 million is not a happy ending for investors and I’m sure liquidation preferences were in place.
It’s funny that people think this is a superb idea and that it validates the market. Even a $15-$20 million acquisition for a company that had $6.77 million would NOT be a successful exit. We don’t know how much of the company investors owned, but I suppose that in the best case scenario where they took a majority stake in the company, they might have gotten out with a marginal increase in their investment, but obviously not anywhere close to the 4-5x increase they are looking for. In the more likely case that they owned a minority stake in the company, the company probably sold at a lower valuation than they invested at. Bix is a young startup, so the question is why they would sell out so quickly at such a low valuation if they really thought there was a huge opportunity here (big enough to justify a $6+ million investment). The answer: they wouldn’t. Something they saw, or didn’t see, in the development of the business must have led them to believe that it was better to sell out now and take comfy jobs at Yahoo at the expense of the upside potential you would want if you really believed that the business was going somewhere. Yahoo should have wondered about this, and while they have different goals and this may fit into their strategic plans, I don’t see a whole lot of value in this for Yahoo shareholders. Not saying they should go out any overpay for Facebook, which would be worse in my opinion, but a lot of these smaller deals aren’t doing much either.
i kinda like that site, just wish they’d add some more filtering and tagging elements…i can completely see this fitting into yahoo, and imagine real utility to see events around performers (same for google in this vein, a la myspace) with additional networking and datingesque stuff…the video player is crisp and fast, though not sure that the presence of ‘mature content’ will alienate the family friendly yahoo core offerings user base….
btw, phonezoo rules, thanks again…put up the intro to beck’s epro for those who want it (just that beat from the intro cycling for 20 seconds)
We’d like to congratulation bix.com and their amazing team. The two competitions we’ve setup with them has worked flawlessly, attracted more than 3 million visitors alone in just a few weeks and build a great amount of interest in our service in general.
If you have a product or service to promote, creating a bix.com competition is guaranteed to build a great deal of interest in your product.
When Yahoo purchased Flickr, it was just a small hobby site with not too many viewers or members, and today its one of the largest and most popular photo sharing site, I expect bix.com to be the same for online competitions.
Solomodels: Just to correct you, Flickr did have a decent number of viewers and members when Yahoo acquired them (otherwise they wouldn’t have had any interest). Obviously it’s grown since then, but Flickr still only has 5-6% marketshare.
Damn smart. Yahoo has bought into a huge winner, this deal is just like Flickr, Yahoo deserves kudos for buying Bix and its patent portfolio. Go Mike!
FYI, I just completed an interview with Bix CEO, Mark:
http://www.centernetworks.com/interview-with-bix
Yes, the supposed purchase price of $15M sounds quite low given the amount previously raised. I wish Mike Arrington had addressed (or at least acknowledged) that somehow in his post.
Drama 2.0: Thanks for your educated and insightful commentary. It is for comments like yours that I read TechCrunch’s Comments sections.
Actually…looks like Marshall wrote the post.
Nifty. Nice move on Yahoo’s part for the experienced leadership.
Was told by someone close to the deal that the acquisition price was just below $100m. Anyone else hearing that?