SubscribeFundraising War Among Video Sharing Sites
After Youku.com’s $25 million series B financing, another video sharing sites 56.com also announced its series B financing of $20 million, led by HIKARI Private Equity and SIG, and joined by Adobe System, CID and existing investors Sequoia China and Steamboat Ventures.
According to the video search report recently released by Baidu, based on traffic, Tudou.com takes 22.18% market shares, followed by 56.com with 19.98% share, and then Youku.com with 13.92% share.
There used to be over 200 video sharing sites in China, I don’t know how many of them are still alive, but I guess maybe less than 10 video sharing sites, excluding video sharing service by big Internet companies such as Sina and QQ, will survive. Since video is a bandwidth consumption service, strong capital backup would be a great advantage in competition.
Here is a summary of the ventured-backed video sharing sites in China, it is a little different from Tag Edge’s version :
- Yukou: $40 million raised to date with the latest round of $25 million in November;
- 56.com: $30 million raised with the latest round of $20 million in December;
- UUSee: $20 million raised with the latest round of 20 million in March;
- Tudou: About 27.3 million raised with the latest round of about $18 million in April.
It seems Tudou has been left behind in fund raising competition, given the high cost of video service, do they need another round of financing recently?
On the other hand, Adobe System’s investment in 56.com may enhance 56.com’s technology, thus increased its competitiveness in the market. (See also Bill Bishop’s post for information about 56.com’s CDN network.)
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4 Responses to “Fundraising War Among Video Sharing Sites”
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Youtube received 3,5 mil in there first and another 8 mil USD funding in there seconds round. This money was more than enough to expand there datacenter and to get sales and marketing to a higher level.
Silly investors, sigh….well, actually this might not be that bad - a big chunk of the money will cover online marketing cost, ciculate in China’s Internet industry, and finally, most likely, arrive in Baidu’s pocket.
VC’s in China have no dreams, or style…come on, we Chinese entrepereneurs are smart, there got to be some real fun projects out there, under-funded!
[...] 1. As always, money is key. Even basic bandwidth is a key expense for the video UGC-market and the past year seen furious amount of venture capital into a number of popular UGC-sites. [...]
[...] In last December, we suggested that Tudou would need a new round of financing, considering high burnrate of video business and fierce competition in the market. Now, it is great that Tudou can successfully close this round when facing uncertainty in regulation environment. Now Tudou is ahead of competitors again, and it “actually turned down offers of even higher funding”, because “because this industry is not about raising more money”. [...]