VentureBeat

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Plenty is being written about the woes of podcast company Podtech.

Now the company tells us it is taking on more debt, and will be making an announcement soon. This follows a recent $2 million round of fresh capital reported last week.

Podtech, a San Mateo, Calif. launched more than a year ago to create content that could be streamed to viewers, and planned to find advertising to insert inside of the content.

It was never clear what the business model was. The whole point about the new Web is that it is so cheap. You don’t need millions to produce content, or to distribute it — and yet Podtech initially raised $5 million to do so. we’re not surprised the company is now struggling.

Podtech, 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 us become increasingly skeptical about the latest video companies, which continue to get millions of dollars of venture capital in backing.

Without a clear way to make money, Podtech is just the first of what will be many finding themselves backed into a corner. Perhaps that’s why Podtech’s public behavior has become odd. Techcrunch recently wrote a post, noting a change in strategy by Podtech to aggregate videos produced by others and to seek to find advertising for it all — using its own video player technology for distribution. Techcrunch was first to note the company had raised an extra $2 million from its existing investors U.S. Venture Partners and Venrock.

Yet several weeks ago, we’d actually heard about this funding from a source, and contacted the company for comment. Podtech’s PR person Valerie Cunningham said an announcement was pending, and suggested we talk with CEO John Furrier. However, Furrier proceeded to contradict Cunningham and said no money was being raised. He said a new round was being raised in fall. (See our resulting story, where we also wrote about Podtech’s new distribution strategy and its relationship with National Banana and RockinCat.)

Imagine our surprise when it it was later revealed that the internal funding had indeed happened. Furrier apologized last week for his evasiveness, explaining that he’d been in the process of raising a round (what he should have done was simply say “no comment”). Now he tells us the company is in the process of raising new debt, too, and will soon issue a press release about that.

There’s no point heaping more criticism on Furrier and Podtech at this point, because they’re under pressure and knowing the people working there, they mean well.

However, the company continues with a cloudy notion of where it is headed. Furrier’s post Friday describing the company’s “focus,” is anything but focused. Here is what he said:

7. focus of the company: 1) editorial content, 2) develop media franchises through signing (aggregation) of professional producers and in house development (our studio), 3) continue to be the leader in social media for our clients, 4) innovate on the social media ad models that we are developing, and 5) media technology platform

Unlike Techcrunch, we see little hope for Podtech going forward. It is neither focused on unbiased content creation, nor on developing an advertising platform to distribute video. If it is to survive, it must pick one or the other.

Another company, Odeo realized something similar, and actually gave its money back to its investors and took a different tack (we pointed to founder Evan Williams’ public confession about the matter here).

Podtech’s original model would have worked had it not taken venture capital. There’s plenty of business to be made producing marketing pitches for large companies, which it appears to have done with clients like Seagate and Intel. This is work that advertising/marketing agencies do, but there are plenty of these agencies, and you don’t need to be venture backed to do this. Podtech could have filled a niche in that industry, but now has taken too much capital to settle for this.

Meanwhile, how does it justify pumping $500,000 into special shows only to lose their anchors?

We should note that the whole relationship between Podtech, U.S Venture Partners and other portfolio companies is convoluted. In National Banana, US Venture Partners’ Steve Krausz invested in a company run by the husband of his sister. That company is now apparently distributing content through Podtech. Krausz told us his only experience investing in a media company prior to this was Palladium, a video game company that produced parodies on popular games (such as Pyst, in a parody of Myst) back during the late 1990s. The company struggled for some time. Krausz told us the company was sold for a small profit, but another source suggests it was sold at a loss. We’re checking public filings to verify. [Update: Here's what we've found. At time of sale, the deal was essentially breakeven to tiny profit, technically justifying Krausz' use of the term "profit." However, by the time U.S. Venture Partner's investors got the stock, many of them realized losses on it.]

But National Banana, with backing of $1 million, is run by Anthony Bettencourt, a former Entrepreneur in Residence at USVP who also has no media experience. Krausz says the project is an experiment, and worth doing given the huge changes going on in the media world. That’s fair enough. But if you want to do that, you should have a clear strategy about how to do so.

Voicethread has just launched an impressively designed service that allows groups of people to simply add voice or text comments to image albums.

The creator of an image album can tell his/her story using voice, text or by drawing on pictures. Visitors can add to the story using the same tools. (Here is an example. And another sweet example.). The comments are in the form of a back and forth conversation (”voicethreads”) around the images. The participants are ordered in a strip along the left hand side. Voicethread’s group format makes it different from audio competitors such as Odeo. Compared to visual competitors such as Our Story, Voicethread’s advantage is its simpler interface. You grasp it immediately, and don’t need a dose of coffee to “get” it.

Users can embed widget versions of Voicethreads on blogs and other Web sites.

Voicethread, of Boca Raton, Florida is the first venture for founders Benji Papell, previously a professional tennis player and real estate developer, and Steve Muth, previously a New York City paramedic and toy inventor. They don’t have a business model that we’re aware of. This may be a feature worth acquiring.

Sean Rad, co-founder of Orgoo.com, is a VentureBeat contributing author.

Here’s the latest action:

OpenID is gaining ground — OpenID is a service that lets you use your URL as your username anytime you have to login to a site that requires username and password. Until now, it has been slow to catch on — Web sites have taken their time to allow it. But an increasing number of sites are doing so, because it’s convenient for users. Here’s how it works: You use the URL as your username as you sign in, and this triggers a request by the site to obtain your identity details that you keep safely locked up another site (your so-called provider). More info here. Microsoft recently said it will support it, AOL is now supporting it, and now Digg is too, among a long list of others.

Shawn Fanning’s new company, Rupture, goes live — The site allows gamers to network and maintain profiles based on the game World of War Craft (we reported on Rupture here). Let us know what you think.

Startupping, a site for entrepreneurs — Mark Fletcher, a successful entrepreneur, has started a web site for entrepreneurs, Startupping.com — allowing them to trade tips, resources, etc. Fletcher, you’ll recall, successfully built and sold two companies: eGroups (to Yahoo) and Bloglines (to Ask).

Trulia releases housing API – Trulia, the online real estate company, has opened its API so that anyone can build their own home price forecasting tool, heat map, or application comparing home prices and other variables. We’re not sure how widely useful this is, but there are some interesting stats emerging, such as how people pay less for homes in areas where there are more women and how more foreigners mean less crime.

Odeo, podcasting service, looking for home — This the saga that won’t go away. San Francisco entrepreneur Evan Williams bought back his podcasting company, Odeo, from investors, but has now focused his energies on an SMS service spin-out, called Twitter. So now he wants to sell Odeo, which has a respectable 3 million monthly page views, and breaking even on adsense. Notably, he asks whether there’s a marketplace where he can publicize the sale. We can point him to our very own VentureBoard, launched not long ago. Recently, SupportMagic listed itself and an investor saw the listing, and bought it. (The board’s most recent listings get mentioned on our home page.)

EU commits to halt greenhouse gas emissions, while US commits to increase them — Here’s the story on progress by the European Union countries to commit to lower greenhouse gas emissions, which has yet to be ratified by the individual countries. Too bad that the U.S. is standing still. Already the biggest polluters, we’re planning another 150 coal plants over the next few years to meet our growing energy needs, and have no agreed upon way to capture the resulting carbon dioxide before it spews into the air. Meanwhile, North Pole is seeing record levels of greenhouse gas.

Confabb, the conference social network, sells? — Rumor, at Techcrunch, is that Confabb is being acquired for $5 million or so, after just three months’ work. Not bad at all for founder Salim Ismail, who’s last company PubSub didn’t do too well. Confabb’s angel investors include Dave Winer and Andrew Rasiej.