Israel Digital News

Web 2.0 video sharing site Metacafe has raised $30 million in Series C financing led by Highland Capital Partners and DAG Ventures. Existing investors Accel Partners and Benchmark Capital also participated.

In March 2006 Metacafe has completed a second financing round, raising $15 million from Benchmark and Excel. The Israeli video entertainment firm raised $4 million from Benchmark and private investors in its first financial round.

The money raised will be used to support the company’s continued global growth, including expanding the breadth and depth of content. Earlier this month, Metacafe announced a partnership with Skype, that allow users to download videos from Metacafe site and share them with friends and family across the world.

“Metacafe is defining the next generation of online video, moving away from simple video sharing and hosting to delivering an exceptional entertainment experience for short-form content,” said Richard de Silva, Partner, Highland Capital Partners.

With the close of this round, co-founder Arik Czerniak will step away from day-to-day operations to pursue other entrepreneurial endeavors but will remain on the board and continue to advise the company on strategic matters.

Metacafe is currently having more than 25 million unique viewers each month. The Israeli startup is headquartered in Palo Alto, Calif., and has offices in Tel Aviv and New York City.

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Video sharing startup Metacafe appointed Erick Hachenburg as the company's CEO. Prior to joining Metacafe, Hachenburg was Electronic Art’s senior vice president of global online publishing and managing director of EA China. Hachenburg joined EA following the company’s 2001 acquisition of casual games firm Pogo.com, that Hachenburg founded. Arik Czerniak, co-founder and former CEO, will remain on the executive management team to focus on strategic product issues and partnerships.

Metacafe, an independent rival to online video service providers like YouTube, Break.com, Revver and GoogleVideo, expanded its management team early this year, with several new key executive hires. MetaCafe named Bud Colligan, former head of software maker Macromedia and a software investor at venture capital firm Accel Partners, as its chairman. Colligan co-founded Macromedia in 1992 through a merger of Authorware and Macromind-Paracomp. Prior to Macromedia, Colligan worked at Apple Computer's Macintosh Division.

The company hired Erik Smith as vice president of content and programming. Smith, who brings considerable experience in experience in bringing companies like ESPN, Fox Sports, Disney and ABC to emerging media platforms and youth media, will be responsible for building new media partnerships and developing an engaging content mix for the Metacafe site. MetaCafe also added Allyson Campa as Vice President of Marketing and Mort Greenberg as Vice President of Sales.

Metacafe attracts a global audience of more than 17 million unique viewers consuming 550 million page views every month, according to comScore report form December 2006. The company was one of the first to compensate creators for great video through the Metacafe Producer Rewards Program that pays video creators $5 for every 1,000 views of their short videos on the Metacafe site.

The company, which has headquarters in Palo Alto, California, has also opened an office in New York City to better serve its advertisers and media partners. The company Research and Development center are located in Tel Aviv, Israel.

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Free video sharing portal, MetaCafe, has completed a second financing round, raising $15 million from Benchmark Capital and Excel Partners. The Israeli Web 2.0 video entertainment firm raised $4 million from Benchmark Capital and private investors in its first financial round.

Metacafe, that competes with two largest video sharing websites, YouTube and Google Video, serves over 280 million videos or Media Snacks a month. Established in 2003, Metacafe currently employs more than 50 people with plans to add an additional 20 workers.

In April 2006, YouTube has received $8M in Series B funding from Sequoia Capital. Founded in February 2005, The Company completed an initial $3.5 million in Series A funding from Sequoia Capital in November 2005. YouTube currently delivers more than 40 million video views every day with 35,000 new videos uploaded daily.

In May 2006, Vpod.tv, a Paris and Madrid based online video sharing site, has received $5.1 million in funding fron the French VC firm Innovacom and Jazztel founder Martin Varsavsky. Besides features simialr to what other video sharing sites have, Vpod includes the ability to integrate advertising in videos, a wide variety of output/device formats, and editing tools. Also, the service seems to have a more editorial focus in terms of videos on the site.

The venture capital rush to invest in online video sharing sites is based on the growing advertising spending on internet video. According to the Online Video Advertising report from eMarketer, advertisers will be spending at least $1.5 billion for online video ads by the end of the decade. eMarketer predicts that internet video has the potential to blend several hot marketing elements: paid search, branded entertainment, viral marketing, consumer generated media, behavioral targeting, website site brand marketing and online gaming.

Last month NBC and YouTube announced a strategic partnership that will combine NBC's quality programming with YouTube's vast audience to enhance the entertainment experience on YouTube while engaging viewers in innovative new ways to promote NBC's Fall program lineup and other preferred shows over the next year.

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