Slideshow creator Animoto syncs business model and traffic, raises $4.4M

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Animoto is one of those companies that makes my job fun. It’s a web-based slide show company that has figured out what looks to be a sustainable business model — and it has just closed a $4.4 million round of funding.

I first covered the company in August of 2007, when it launched its patented slide show-video technology. The product, a tool for creating your own multimedia slide show, stood out from other slide show widget makers because it synchronized photos with beats, vocals and other elements of songs to create a seamless video out of people’s photo albums. It’s grown to include widgets on Facebook (for Facebook photo albums) and other social networks. It also has  its own stand-alone site at Animoto.com and an iPhone application. See the sample below for more.

The company has grown up. Its home web site has 750,000 total registered users, around 10 percent of whom are paying customers. Its Facebook application has more than 90,000 monthly active users and more than 2 million total users. The iPhone application has 300,000 users.

The company has been making money by charging people if they want to create an unlimited number of videos. Its commercial customers helped make it cash-flow positive by the end of 2008 — faster than it anticipated. Professional photographers, for example, are using Animoto instead of more expensive video creation software for clients who want photo-shoot slideshows, chief executive Brad Jefferson tells me. Other video-editing software, like Apple’s Final Cut Studio, costs more than $1,000 and can take hours to use. Animoto isn’t as full-featured, but it costs $249 a year and takes 5 minutes — and results in a video that photographers can sell to clients for the same price as one made with fancier features.

Animoto will use the money to expand its technology for things like better image recognition and video integration within the tool. So the different aspects of songs will better match up with whatever is in the images and videos that you include. The company also hopes to get more users in new industry verticals, such as real estate, where a real estate agent could make a flashy video of photos from a house they’re trying to sell. Jefferson says the company has spotted its videos all over the place — on flat screens in an Israeli hotel lobby, for example — and he envisions it continuing to grow. One day, maybe, you’ll see Animoto videos in sports arenas and other huge venues.

In terms of funding, Madrona Venture Group led the round, with Amazon.com, SoftTech VC and iStockphoto founder Bruce Livingstone participating. New York-based Animoto has previously raised $600,000 in funding, as well as debt it converted for this round. The company has come a long way without a ton of resources.


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  1. VentureBeat says:

    [...] company (with offices in San Francisco and Singapore) since it raised $4.4 million in June 2009 (when VentureBeat gave the company a glowing review), but apparently no news is good news for the company. Since launching in 2007, the company has [...]

  2. [...] (with offices in San Francisco and Singapore) since it lifted $4.4 million in Jun 2009 (when we gave it a intense review), though apparently no news is good news. Since rising in 2007, Animoto has grown to over 3 million [...]