Rodrigo A. Sepúlveda Schulz

On LCI television for the 4th time ;) for this week's Plein Ecran show

Helping the show's host, Cédric Ingrand, interview 4 startups this week: Veosearch, Yoolink, Zilok and Hellocoton.fr.

LCI - Plein Ecran du 22 mai 2009 sélectionné dans TV et Info JT magazine

Interviewed by VNUnet.fr at LeWeb'08; also on hulu.com vs. Youtube

LeWeb08 - Rodrigo Sepulveda - Vpod
envoyé par tennuv92

A few announcements in this video to the press...

Read the article here, thanks to Philippe Guerrier for the chat.

By the way, Comscore had released new numbers for the US the previous day, and I had had no time to review them. So here are some interesting updated data for OCTOBER 2008:

• "U.S. Internet users viewed 13.5 billion online videos during the month, representing an increase of 45 percent versus year ago." > that' an 18,5% increase over the previous number we had for July, 3 months ago, at 11,5b
• "In October, Google Sites once again ranked as the top U.S. video property with nearly 5.4 billion videos viewed (representing a 40 percent share of all videos viewed), with YouTube.com accounting for more than 98 percent of all videos viewed at the property." > that's almost 5,3b videos viewed for Youtube in the USA (% of the rest of the word ???)
• "Hulu, a joint venture of NBC and Fox featuring full-length broadcast TV programs, ranked sixth with 235 million videos viewed (1.7 percent)" > that's about 4,5% of the traffic of Youtube (again, US numbers for both)
• "More than 147 million U.S. Internet users watched an average of 92 videos per viewer in October." > this number is going up, about 5m more in 3 months, getting the reach in the USA from 75% to 77%. The number of videos viewed is differnet per site, Youtube only captures about 53 videos per person, whereas hulu.com gets about 10 a month.
• "More than 80 percent of the      18-34 year olds watched online video, higher than any other age segment.      The average 18-34 year old online video viewer watched 4.8 hours of video      during the month, also ranking above all other age segments." > this is great, because this is the age segment many advertisers want to target them, they are prescribers, have disposable income, more internet savvy...
• BUT THE MORE INTERESTING FACTOR IS HERE : hulu.com has a reach now in the USA of 24m, vs Youtube of a reach of 100m. 24%... Average video length (no number for youtube specifically, anyone has it ?), is 3 min. average length on hulu is 12 min. So youtube streams 3min x 99,5m people x 53,2 videos / 60 = 265m hours / month. Hulu streams 9,8min x 24m people x 9,8 videos / 60 = 45,5m hours/ month. That's 17% of Youtube. Now in previous reports, Youtube only monetizes 4-6% of its inventory. Let's say 5%. Hulu 100%. hence Hulu can monetize 45,5m hours. Youtube can monetize 5%*265 = 13m hours... That's 3x less than Hulu for a site that has 4,5% of its traffic... Latest numbers I've read (maybe totally wrong) is that youtube is doing $100m this year, and hulu.com reports doing $70m... not bad.
• If my maths are not wrong, monetizing 5% and 100% respectively, at $70m and $100m revenue respectively, traffic at 245m and 5,2b video views respectively, and assuming 100% of the inventory is monetized with CPMs, hulu.com is reaching almost a $300 CPM while youtube is reaching a $1 CPM... doh.
• To be fair, if you look at costs, hulu.com should have only 17% of costs of youtube in terms of streamed hours. Actually that's true for bandwidth, CDNs, probably not really for servers, they must have a large installed base also to handle the load. All in all, assuming a random scaling factor, let's say hulu.com has costs that are x2 or x3 more than youtube (the google effect behind). Hence 34% to 51% of youtube's costs. With 70% of revenues of youtube, I think I like hulu's model so much more ! including the UI of course.
• Finally, there's a hiccup in this discussion. Although youtube is doing rev-share with some of its content publishers, hulu probably has to do rev-share with rights-holders as well. And in the movie business (including TV series), there's a thing called MINIMUM GUARANTEES, that you pay usually upfront to get the right to broadcast a catalogue. This happens so that there's a minimum income for the studio, that it justifies fixed costs, etc. In addition, MGs tend to be charged by territory, hence even more expensive if you want a global footprint for your service (hulu is only in the USA for the moment, so get a VPN ;). This challenges clearly the COGS structure of a hulu.com, and as a matter of fact any new entrant who'd like to compete with hulu. They'd face the same issues.

Final thoughts :

• there's a B-model for online video properties that can monetize 100% or nearly 100% of their inventory
• acquiring rights to content is a challenge if MG are involved. The industry has to move to a pure OPEX model, but this challenges somehow the media channels release chronology. (more on this another day)
• great quality (content encoding quality, content type, user interface), command for longer viewing experience
• longer viewing experience allow for new video ad formats (overlays, mid-rolls), hence increased revenue streams.

Anyone else has more numbers ? different thoughts ?

wikio discloses financial numbers

Very interesting that Pierre Chappaz disclosed his numbers here: very small revenue stream, but in steady growth, which allows him to close a year with 1,19m€ in revenue.

Also very interesting that advertising (display ads + google adsense) is less than 50% of that, making most of his revenue from affiliation. But it took them 5m€ invested money to get to that point for a company launched in 2005.

Finally, a single revenue stream is not enough today : the sum of small revenue streams is necessary. But if you look at the revenue in %, he showed in another slide that his traffic is exploding. Hence his adsenses are decreasing heavily in %, and probably shopping (maybe display ads, didn't do the maths) are growth drivers.

He says he just reached breakeven in Q4, hence his costs are less than 540K€ for 35 people (that's really not much in costs... lots of interns ? or lots of cheap labor), so about 160K€ in burnrate / month, accoding to this chart.

You also see that in 12 months), wikio reduced its burn-rate at almost 60% of what it was. Companies have to do a lot of things these days to survive. Reducing costs is painful but doable. Increasing sales is harder, and traffic too. Usually a very good sign.

Nevertheless good trends, congrats Pierre.

answering questions about entrepreneurship

update : actually this is a 6 part series. Will put them up here later. In the meantime check this youtube channel: http://www.youtube.com/profile?user=EricIngargiola&view=videos

update 2: All videos will place sequentially above now.
 

My new official portrait, by Olivier Ezratty

(credit: Olivier Ezratty)

Xavier Niel, founder of Iliad / free.fr joins vpod.tv Advisory Board

Half Moon Bay, CA - July 21st 2008, Fortune Brainstorm Tech conference

My long-time business partner, Ivan Communod, and I started working on the original concept of vpod.tv in September 2005, when we realized the growing importance of UGC + growth of fixed and mobile bandwidth + development of video-enabled devices. We were frustrated that we couldn't publish videos easily online. We tell the story here.

After developping a first prototype, we went fund-raising, and closed a 4 million euros Series A with Frédéric Humbert, GP at Innovacom, a few days after we incorporated the company in France on May 15th, 2006, slightly over 2 years ago. Along the way, a select group of business angels have joined us as shareholders, including Internet entrepreneurs Martin Varsavsky and Loïc Le Meur.

We went into exactly one year of product development based on our original prototype, changing our business model from our original B2C concept into a pure B2B SaaS play about 6 months later (end of 2006) when we realized it was a B2C market game over when YouTube got acquired. We opened a first beta version of our v1.0 to the general public both on the web, mobile and on a number of different products. You can see our first product on http://studio.vpod.tv.

On May 15th 2007, we opened up for business, exactly 365 days after incorporating. We are glad to report that we have now over 50 live customer refererences in 4 sectors: global brands, media groups, telcos and e-commerce services.

By May 15th 2008, we knew that we had a proof of concept with very solid business cases in each of our markets and that is was time to "move on to the next level". We have hence been massively preparing for international expansion, and have completely re-written our platform, packed with new features (support for over 200 file formats, carrier-grade infrastructure, advanced backoffice tools for real-time configuration + statistics + moderation, etc.). Version 2.0 should launch in September, as we already have a nice number of very high-profile customers running it on a day-to-day basis.

As any entrepreneur knows, the road to success and rapid expansion is a very bumpy one. Fortunately for us, many others have already traveled that road and can help us make the right decisions and avoid the pitfalls of rapid growth. We have therefore reached out to the folks we feel can best help us grow our company, and who share a deep passion for entrepreneurship, technology and media.

Ivan and I are delighted to announce our new advisory board member, and new investor, M. Xavier Niel, founder and Chief Strategy Officer of the Iliad group, better known in France under the brand free.fr (see Wikipedia).

Xavier is an exception in France: he's a fantastically gifted entrepreneur, having totally disrupted the French telecom market and in my opinion, the man that made France a global Broadband leader. To me, he is totally focused on key values that we love to love, such as among other things: an incredible charisma, a commitment to enhanced customer value proposition, a deep focus on cost and margin control, a spirit of continuous innovative services and a visceral competitive nature. His personality was best captured last year in a lengthy profile by my friend journalist Om Malik.

A very large part of our business at vpod.tv is managing our technology infrastructure: bandwidth, storage, servers, SLA monitoring, growth management, etc. an area managed by Ivan on the technology side, and by me on the business side.

Xavier was a natural fit and his role will be, along with a mentoring role, to help us keep our edge on the technology side, hence helping our customers benefit from this expertise. We are honored and excited to have him on board.

Great interview of me on Tiburon TV

I had almost forgotten about this interview, taped at SIME'07 in Stockholm last November. Viktoria (the Journalist for Tiburon TV - "hungry for business") had the whole theater just four ourselves at the end of the conference.

Here I talk about our business at vpod.tv and about entrepreneurship. Thanks Viktoria for a nice time !

Facebook has extended that great feature they had on pictures to videos: I got pinged in my email inbox about this video because they tagged me in the video.

Hey, I also appear in this little clip at LIFT conference (I had never noticed it before on Facebook video).

A nice chat with Felix Haas, CEO Amiando

 

Disclosure: I'm an investor in Amiando.com, along with Lukasz Gadowski (Spreadshirt), Stefan Glaenzer (last.fm), Ehsan Darani (StudiVZ), Eric Archambeau (Wellington Partners)) among others...

Visiting swedish startups: Spotify

Founder & company, originally uploaded by rsepulveda.

Following the SIME conference this week in Stockholm, I was lucky to be able to talk to local entrepreneurs and exchange views both on the local market, but also on technology.

Daniel EK is here in front on his latest opus, Spotify, still in closed beta. Martin Varsavsky has a description here.
His offices are amazingly nice, with lots of space and great interior decoration. The business should be about to launch, and they are fully self funded.

I met Daniel in Monaco the other day, and was excited to see him again here in Stockholm. Catch him next time at LeWeb3 in Paris in December for more great stuff on how to disrupt the music industry : huge catalogues of legal content, smart online distribution, ad-based B-model...

These nordic people have a special twist that we don't have, and indeed, the Baltics are part of the secret recipe.

on the "chat" of the Journal du Net at the end of the month

Amusing... I was just checking what was written about us on the chat on the Journal du Net, coming up at the end of this month.

Several comments & corrections:

* vpod.tv is always spelled in small caps. Can't understand why people keep spelling it vPod.tv...
* the title is "vpod.tv : a story of a success or a failure...". Nice :) You've got to love the way journalists do marketing :)
* pix by Benjamin Boccas, not quoted as I had asked to
* how do we compete vs. Youtube and Dailymotion ? We don't as we really don't offer the same service, nor have the same business model. I actually had lunch with the CEO of Dailymotion today (btw, congrats of winning the BFM award tonight). Really nice guy, and nice lunch.
* is our B-model "based on a free service" viable ? well our service is really a paying service for B2B... and we have small number of free users to let them try it out... more on the chat.
* I'm not the founder, but the co-founder, with my friend Ivan Communod.

Start preparing your questions. It's on the 26th of November at 17h.