Podshow, a company that promotes podcasts and finds sponsors for them, has raised $15 million more in a second round of venture capital from its big-name investors, following up on $8.85 million in a first round last summer.
Dan Primack has the scoop.
This is, frankly, surprising, because the business model still hasn’t been proven for this medium. This is a lot of money. There are other players out there, too, like Odeo (funding from Charles River & others) and Podtech (raised $5.5M from USVP & Venrock).
But then a number of investors see a land-grab going on here, an effort to be the primary destination where thousands of individual musicians and other content producers will come to provide their wares, and where millions of listeners will want to download them. We just saw Digg founders launch Revision3 to go for this market in the video area. And like Podtech, Podshow is working with bigger companies — in PodShow’s case, mainstream media companies — to help them produce and distribute podcasts. PodShow is also buying up other podcasting companies, so the cash could be meant for buying up more sites to become the biggest player. Its programming is extensive.
Still, we agree with Dan’s skepticism, as the whole premise of the Revision guys (they raised only $1M, see link above) is that it really cheap to launch these sorts of services. According to Dan:
Tags: co:Podshow, co:Podtech, co:Revision3, inv:liberty-associated-partnersI just struggle to see venture-type [return on investment] for most of these deals, unless they can be flipped before Yahoo, Google, etc. put down their tall glasses of content Kool-Aid. This isn’t to say that the podcasting market is inherently unprofitable, because it isn’t. VC-backed companies, however, are supposed to produce something a bit more exciting than respectable margins.
Some VCs agree with me, but it is clear that many others do not. Case in point is PodShow inc., which recently raised $15 million in Series B funding. This follows up on an $8.85 million Series A deal from last summer, from Kleiner Perkins, Sequoia Capital, Ram Shiram and Jerry Newman. All four are back this time around, but an undisclosed lead came aboard at a major pre-money valuation step-up.
9 Comments
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Brian McConnell said:
Podcasting is very similar to Internet radio and businesses in this space should be evaluated as such.
Some companies are making a respectable but not particularly exciting living hosting media streams for content providers.
The other people making money are the content providers themselves.
In terms of technology, there is not much to podcasting, it’s just an RSS feed and HTTP download. Thus, no opportunity to build high value technology around it.
Creating content isn’t really what VCs should be funding, just as the phone companies failed whenever they tried to get into the entertainment business. My guess is the people who will figure out how to make money from podcasting, or any other Internet media technology, will be in Los Angeles, not Silicon Valley.
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Alexander Muse said:
Our own experience in this space with Big in Japan (PodServe and Fancast) perhaps jade my thinking on these things, but I don’t get it either. What is the money for? Really, what can you do with $15MM that you can’t accomplish with far less risk for $1MM?
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Jason Lefkowitz said:
Really, what can you do with $15MM that you can’t accomplish with far less risk for $1MM?
Hey buddy, those Aeron chairs don’t buy themselves!
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BS said:
What if Apple goes after them on the trademark issue?
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pwb said:
“there is not much to podcasting, it’s just an RSS feed and HTTP download”
I’m not even sure that RSS plays much of a role. Most podcasts are just donwloaded like any old file.
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ron said:
it’s such a messy network…biggest waist of money ever!
i give them a year.
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Phillip Molly Malone said:
Wow, Wonder what Cameron Reilly’s “The Podcast Network” would be worth then. At least that site is navigatable!
Molly -
Jack Schnorr said:
Next question of first podcasters. Will Aruntx Publishing Company do venture capital or just go public with all the big money they made with the telephone company deal.
More should be revealed.
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Grand Theft CJ said:
What advertising is available on podcasts anyway? Same as radio?
20 Trackbacks
9:28 am
VentureBeat Wire » PodShow raises $15M more for podcasting….yikes! said:
[...] See our story here. VentureBeat Community [...]
11:23 am
Techcrunch » Blog Archive » RaidioTail releases free podcast stats tracking said:
[...] Other announcements at this weekend’s Portable Media Expo were to include a rumored new round of funding for Adam Curry’s Podshow, but that story’s already broke. Podshow has raised $15 million more from as yet undisclosed investors, on top of $8 million from its A round. Some people are skeptical to say the least, but it’s evidence that other players are betting on a big podcasting economy. There’s still another big interesting announcement in the online audio advertising space that will come out next week. This growing economy will have a tail, it will need to be analyzed, and RadioTail’s free stats service is likely to work well for many podcast publishers. [...]
12:21 pm
Scripting News for 9/28/2006 « Scripting News Annex said:
[...] Podshow raises another $15 million. Oy. [...]
2:25 pm
Podshow is big business | Bakkel dot com said:
[...] Podshow (Adam Curry) heeft een nieuwe financieringsbron aangeboord en die heeft $15 miljoen uitgespuugd. Volgens dit bericht is dit een ‘extraatje’ bovenop een eerder overgemaakt bedrag van $8,85 miljoen. Wat je ook mag vinden van meneer C, hij krijgt het toch redelijk op orde allemaal. Deze link delen?These icons link to social bookmarking sites where readers can share and discover new web pages. [...]
3:38 pm
Podshow Raises 15 Million Same Week As Podcast Expo | Paul Colligan’s Profitable Podcasting said:
[...] Podshow Raises 15 Million Same Week As Podcast ExpoPosted on 2:38 pm by Paul Colligan Whenever there is a big show, there are a lot of announcements. Many times, surprisingly, the biggest announcements come from the people who don’t buy the booths. Congrats Podshow. The more money in this space - the better we all do. You just added 15 million to the game. Thanks. [...]
4:46 pm
TechCrunch Japanese アーカイブ » RadioTailã€ãƒãƒƒãƒ‰ã‚ャストã®ã‚µã‚¤ãƒˆçµ±è¨ˆã‚’ç„¡æ–™ã§ãƒˆãƒ©ãƒƒã‚¯ã§ãるサームsaid:
[...] 今週末ã®Portable Media Expoã§ã¯ã€Adam Curryã®Podshowã«æ–°ãƒ©ã‚¦ãƒ³ãƒ‰ã®è³‡é‡‘調é”ãŒç™ºè¡¨ã«ãªã‚‹ã¨ã„ã†å™‚ã‚‚ã‚ã£ãŸãŒã€ã“ã®ãƒ‹ãƒ¥ãƒ¼ã‚¹ã¯ã‚‚ã†å ±é“済ã¿ã®ã‚ˆã†ã 。Podshowã¯Aラウンドã§$8M（800万ドル）を調é”済ã¿ã€‚今回ã®èª¿é”é¡ã¯$15M（1500万ドル）ã§ã€æŠ•è³‡å®¶ã®åå‰ã¯ã¾ã 明らã‹ã«ã•ã‚Œã¦ã„ãªã„。話をéŽå°è©•ä¾¡ã™ã‚‹æ‡ç–‘派もã„ã‚‹ãŒã€ã“ã‚Œã¯ãƒãƒƒãƒ‰ã‚ャスト産æ¥ãŒå¤§ããæˆé•·ã™ã‚‹æ–¹ã«è³ã‘ã¦ã„ã‚‹ä¼æ¥ãŒã„ã‚‹å‹•ã‹ã¬è¨¼æ‹ ã ã‚ã†ã€‚ã“れ以外ã«ã‚‚オンラインã®ãƒ©ã‚¸ã‚ªåºƒå‘Šæ¥ç•ŒãŒã‚‰ã¿ã®éžå¸¸ã«èˆˆå‘³æ·±ã„発表もæ¥é€±ã«äºˆå®šã•ã‚Œã¦ã„る。 [...]
5:20 pm
The Last Podcast » Podshow Raises $15 Million More in VC said:
[...] PE Week Wire and Venturebeat report that Podshow has raised another $15 Million in venture capital. [...]
9:26 pm
Howard Lindzon » Podshow raises $15 million - The Podcast phenomenon is in high gear… said:
[...] Based on Podshows raise today and the quality of programming in their business lineup of podcasts (insultingly drab and suicidal), Wallstrip is worth $250 million. Cool. [...]
9:48 pm
Texas Startup Blog: Entrepreneurship and Innovation in Texas » Blog Archive » Rails and Usability! said:
[...] With any standard programming language it would take a week to make the necessary changes on the front and backend to reflect this new workflow. With rails we were able to see the new workflow on our development servers within an hour. By the end of the day those changes will be committed to the production server. Total turn from idea to code: 4 hours. Talk about agile development! With rails you couldn’t figure out how to spend $15MM… [...]
3:57 am
» SYNTAGMA - 45-Site Network Magazine said:
[...] Podcasting There’s a story doing the blogorounds today about a company called Podshow which has received $25M in VC funding. A number of commentators, including canny Jason Calacanis, are questioning the logic of the money stream : “What on earth Podshow is going to do with almost $25M in funding is anyone’s guess, but it’s not going to end well I can tell you that.” [...]
11:17 am
RadioTail releases free podcast stats tracking » JenIT said:
[...] Other announcements at this weekend’s Portable Media Expo were to include a rumored new round of funding for Adam Curry’s Podshow, but that story’s already broke. Podshow has raised $15 million more from as yet undisclosed investors, on top of $8 million from its A round. Some people are skeptical to say the least, but it’s evidence that other players are betting on a big podcasting economy. There’s still another very interesting announcement in the online audio advertising space that will come out next week. This growing economy will have a tail, it will need to be analyzed, and RadioTail’s free stats service is likely to work well for many podcast publishers. [...]
1:14 pm
VentureBeat » Roundup: 4Info, DAG backs Podshow, MySpace hype… said:
[...] DAG Ventures was lead in Podshow’s latest round — We reported Podshow’s latest $15 million venture round here. Turns out, the lead investor was DAG Ventures, the same firm that has invested in Grouper (and so knows what it means to make money from Web 2.0) and Friendster (and so knows it can be a seesaw). [...]
12:25 pm
Public Secrets » Podshow on the move said:
[...] They got another 15M$ from their venture capital [link to article]. [...]
6:41 am
Podcast Fresh - » PodShow Heave Another $15M said:
[...] Expect big changes and gigantic podcasting developments as PodShow, the premier podcasting company based in San Francisco USA, publicly confirmed few days ago that they raised another $15M from the second round of their funding from DAG Ventures. This was a huge follow up to the $8.85M.funding they obtain from their initial round from Sequoia Capital, Kleiner Perkins, Jerry Newman and Ram Shiram thus bring the total amount to more than $23M of funds. [...]
8:47 am
Dave Hamilton / Dave The Nerd » Blog Archive » Podshow’s Second Round said:
[...] As many of you know, I was at PME this weekend and, of course, saw the Podshow funding announcement just as things were getting started. I had a few conversations about it with people, though since I was traveling I didn’t read all of what the blogosphere was saying online. Everyone had their opinions, of course, but no one I talked to about it saw what, to me, is an obvious interpretation. [...]
6:35 pm
Scripting News for 10/26/2006 « Scripting News Annex said:
[...] Next, obvious question — will Adam give back the money he raised for PodShow? [...]
9:36 pm
PodShow Gets Second Round Financing · Anyone Can Do It said:
[...] complete article [...]
10:33 am
Podtech takes on more debt — but must decide whether fish or fowl by BlogForward : Money said:
[...] of course, is far from alone. Another company, Podshow, has raised close to $24 million. A wave of video content creation companies have subsequently launched this year. You’ve seen [...]
5:00 pm
VentureBeat » Podtech takes on more debt — but must decide whether fish or fowl said:
[...] of course, is far from alone. Another company, Podshow, has raised close to $24 million. A wave of video content creation companies have subsequently launched this year. You’ve seen [...]
6:58 pm
Astral Media Radio » RadioTail releases free podcast stats tracking said:
[...] Media Expo were to include a rumored new round of funding for Adam Curry’s Podshow, but that story’s already broke. Podshow has raised $15 million more from as yet undisclosed investors, on top of $8 million from [...]