Mobile and social video startups are attracting major investments from Venture Capitalists. “We don’t see a ‘bubble’ in video. We are just scratching the tip of the iceberg” says startup investor Paul Bricault of Greycroft Partners and incubator Amplify.LA.
YouTube has become the “train track” for video oriented startups. Facebook is the backbone for many successful social companies, and YouTube will play a similar role for the video startup ecosystem, Paul explained at the Variety Venture Capital and New Media Summit.
Video has historically been constrained by bandwidth, but now that has changed. Broadband is available in the home and on mobile. Smart phone usage is skyrocketing right along with video consumption. This makes social sharing of videos possible on a scale that was hard to imagine just a few years ago.
Who’s Hot? Viddy, SocialCam and Tout
Viddy added 20 million users in two weeks recently, and was rewarded with a 30M investment at a 350M valuation. Venture investors give Viddy credit for a great design, creative user experiences, plus celebrity promotion from Justin Beiber – all hallmarks of an emerging class of LA startups that leverage Hollywood’s creativity.
SocialCam has 85M Monthly Active Users (MAU) on Facebook – and its a mobile app! SocialCam is an internal startup of Justin.TV, a successful online video company, so they know all about driving video consumption. SocialCam’s adoption rate is amazing – I met with them in September of 2011 and they were just getting started!
Tout has great celebrity adoption – including Ryan Seacrest, Kelly Ripa and Shaquille O’Neal. Tout’s highest profile users are “organic” – the celebrities found it themselves and started using it simply because it works for them, not because they are incentivized to do so.
Diverse Opportunities in Video
Mobile apps aren’t the only video related startups that are attractive to venture capital investors. Entrepreneurs should think hard about the many roles they can play in industry as video capacity and social sharing giving rise to the great next wave of startup innovation.
Comcast Ventures‘ Managing Director Michael Yang points out that mobile social apps, YouTube and video sharing on Facebook are all driven by “macro trends” that will create a wide range of opportunities for startups. As video consumption skyrockets and mobile engagement deepens, entrepreneurs should find new market niches and apply well known tactics.
Startups pioneering new ways to monetize users, target ads and leverage data on mobile social platforms are being considered for VC funding by Comcast.
Readers, do you think the current excitement about video startups is a bubble, or the tip of the iceberg?