In a world where most startups choose gaining users over making money, Animoto is an odd exception: It’s doing both. Since launching in August 2007, the company has signed up some 750,000 users, and some 10% of those are paying customers. And that’s allowed the company to run cash-flow positive since December of last year, CEO Brad Jefferson tells us. And it could keep going on like that, but like most startups that taste success, it wants to do more.
So it has raised by far its biggest round of funding to date, a $4.4 million Series B led by Madrona Venture Group. With an already proven business model, Jefferson says the company just wants to accelerate everything it’s doing, and push harder. That means a more diverse roadmap and more importantly, a much broader distribution strategy with more partnerships. One of those partnerships with with iStockphoto, whose founder, Bruce Livingstone, participated in this round.
For those not familiar with Animoto, the startup basically allows you to take your images and your music and mash them together to create cool videos. What makes the videos cool is the company’s technology that renders the pictures so they’re in-step with the music you’ve chosen, adding nice transition effects. We’ve gushed over it previously here, here and here.
One relatively new area of focus for the company is the mobile realm. Back in December, it launched an iPhone app that allows you to create videos from your pictures and music on the device. The app already has 300,000 users. And Animoto has had version 2 of the app ready for months, but Apple has yet to approve it. Jefferson isn’t sure what the actual hold-up is since the first version submitted had very little different besides some upgrades from the first version. And later, Apple apparently didn’t like that it was pushing users to its site to sign up for pro accounts, something which should be rectified shortly with the iPhone 3.0’s in-app purchase system, according to Jefferson. The plan is to have an app that charge the same $3 (or less) that it does on the site to make premium videos (using full-length songs).
And another reason the company is going to need that money is because it’s expanding beyond using photos for its videos and into also using actual videos. Jefferson wouldn’t say too much about it, but check out the Webby’s video below for a preview of how that will work. At this year’s Webby’s it won both the Judges Choice and People’s Voice awards for Best Services & Applications.
“We really believe we’re at the tip of the iceberg for cinematic artificial intelligence technology,” Jefferson says. “We want to allow users to create high production video that tells a story. That has the feel of a short form documentary. Right now that’s mostly teed off of music, but in the future it will be done off of meta data in the photos as well,” he says.
Animoto has raised $5 million in funding total so far, including money from Amazon back in May that was rolled into this round. Prior to that a group of personal investors provided $600K. Additional investors in this round beyond Madrona, Livingston and Amazon include Jeff Clavier’s SoftTech VC. Matt McIlwain, the Managing Director of Madrona Venture Group is joining Animoto’s board of directors.
As somebody who is passionate about visual storytelling I can’t wait to see what they’ll do with video.
Help needed…
My gmail account got hacked, and by the ‘Activity Log’ feature of Google, I could figure out the IP address from where my email account was logged in.
The IP was 204.15.23.171
I do not know how to figure out which browser is this. Is there any software that can figure out whose machine is this where my account was opened and emails were tampered?
How to track down this hacker with IP 204.15.23.171 ?
Coincidentally, I signed up for an Animoto for Business account two days ago, and sent in a support request about the service. No response to date.
I used Animoto to make this for some consulting I was doing… The product is awesome and did all the hard work.
http://www.grou...sneak-peek.html
P.S. Here’s the movie I signed up to create:
http://www.w3roi.com
Some navigation menu didn’t link yet,why?
Nice!
You probably wanted to say… ‘And it could keep going on like THAT, but like most startups that taste success, it wants to do more.”
Just 7 comments. HAHA I guess making money is boring.
Iran photographers use Jimiishappy.com for their videos . It’s an Animoto like but you can put links in the video. Animoto cannot.
An example here !
http://www.jimi...mp;numeroClip=1
Animoto for Business lets you put a button and link in the video. I wanted to play your JimIsHappy clip to see the difference, but it’s been 3 minutes and still loading on broadband, so I gave up waiting.
There is an application for windows mobile called
trakaxmobile that allows you to mix photos, audio, video and introduce text on the fly on your mobile phone. You are in control of what video, photos and audio are introduced to the mix. You can also edit your videos, photos and audio before mixing.
Here is a video of it in action
http://www.yout...h?v=qObdk72STJM
It is encouraging to see it achieve cash flow positive. But I feel the market for this kind of service is small though probably not going to be a big hit for NASDAQ
Stock Trader’s Blog
Good job guys.
I’d be interested in seeing more data on those 75,000 “paying customers.” It’s great and all, but it means nothing without some additional metrics around the characteristics of that customer set. I.e., how many 1-time customers (like me, who paid to try it), and how many come back over and over again, etc.
Agian, big hat tip for growth + cash flow positive!
Ah, I see people PS-ing the videos they made. Here’s ours: http://www.vimeo.com/1490046 (one minute).
@Dan Grossman !
you wait 3 minutes to watch the clip ???? Incredible.
the apple app approval process is total bullsh*t. full of politics. they must be feeling threatened by animoto.
Did not knew about this site. Learned something new. Will give a try.
Congrats to the guys at Animoto! It’s been awesome to watch their success.
Great and easy to use service.
I really like their business model.
I just love reading stories like this. Not only am I one of those paying customers (dig the product), I love hearing about the success of small companies. Very inspiring.
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