Written by Liz Gannes
Posted Sunday, February 11, 2007 at 8:27 PM PT

 

Bolt.com Selling to GoFish for $30M

Bolt, one of the larger independent online video sites, is selling itself to GoFish to escape its copyright battle with Universal Music Group. We had been tracking this story as it developed, but the New York Times now reports the deal has gone through.

GoFish is a publicly traded video aggregation and search company. It went public through a reverse merger last October. GoFish had 1.4 million visitors in December, as compared to 5.3 million visitors to Bolt, according to comScore. GoFish is paying up to $30 million in stock for Bolt, out of its market cap of $134 million.

In an interview before the deal was done, Bolt CEO Aaron Cohen told us Bolt would be changing its focus, once acquired, to content creation. He said video aggregation, along with its legal intricacies and stiff competition, was no longer an interesting business. Bolt, he explained, would offer its skills at attracting and fostering an internet audience to would-be online video stars.

Bolt-GoFish would look to develop a roster of web content creators, and allow them to keep ownership of their content, Cohen said. This is a similar to efforts from companies such as CNET, blip.tv, and PodTech.

As for its existing content, Bolt is paying a settlement of several million dollars to Universal, and agreeing to pay royalties on any future videos that contain Universal’s music. While Bolt and other sites had defended themselves by citing the DMCA safe harbor — which allows them to wait a takedown notice about copyright infringement rather than using filters to screen videos– it seems that the law is carrying less weight these days.

Since the courts weren’t involved in the case, the law does not change. However, with sites under increasing pressure to police their clips or cut content licensing deals to support them, the precedent is being revised.

Cohen and Bolt president Jay Gould are also involved in a new project, called WikiYou, which has received seed funding from First Round Capital and Mayfield Fund.

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Comments & Trackbacks

  1. […] company GoFish for $30 million in stock. Get the full take on NewTeeVee. No comments Share/Send Sphere Topic: Reporter’s Log Tags: Bolt, GoFish,NewTeeVee […]

    GigaOM » Bolt gets its exit: $30M from GoFish on February 11th, 2007 at 8:37 pm - Permalink

  2. […] Now tonight I am reading at newteevee that they have bought bolt.com with their ridiculous penny stock, reverse merger, inflated stock. Price tag for this gem – a mere $30 million in paper. […]

    Howard Lindzon » GoFish.com is a great example of a Stock Promote on February 11th, 2007 at 9:13 pm - Permalink

  3. This is the most retarded reverse merger/CRACKquisition so far in the Web 2.0 space. 30 million for a company that has about 4x the unique users, even though you’re worth 154 million. Oh wait, that’s the OTC Pink sheet garbage penny stocks. Just because this dog can do some cool tricks, does NOT mean it can escape its legal woes. I got my laughs for the night.

    -JLB

    Jason L. Baptiste on February 11th, 2007 at 9:45 pm - Permalink

  4. […] Liz Gannes at NewTeeVee reports that the Bolt CEO now plans on moving into the content creation business, as video sharing technology is no longer an interesting business.  While you can understand why he’d say that, this seems to me like a sad end to the story. If it’s a part of market maturation, though, things could certainly be worse. I wouldn’t be surprised to see some interesting things come out of GoFish and Bolt in the future. No Tags Sphere It […]

    Bolt Sells to GoFish to Pay Universal Music Settlement on February 11th, 2007 at 10:32 pm - Permalink

  5. […] 1. Bolt.com, unul dintre cele mai mari site-uri independente de video, a fost vandut lui GoFish pentru a scapa de procesul de copyright cu Universal Music Group. Blot urmeaza sa isi schimbe scopul, concentrandu-se pe crearea de continut. CEO Bolt, Aaron Cohen, a declarat ca agregarea video, cu toate implicarile legale si competitia dura nu mai este un domeniu de interes. […]

    Gandeste.net » Selectie 12 februarie on February 12th, 2007 at 1:31 am - Permalink

  6. Hey Liz,

    A lot of people have been misinterpreting the motives of the acquisition. I just wanted to comment to give a little clarity from our perspective.

    We are merging Bolt with GoFish, settling our disputes, and refocusing our efforts on growth. The New York Times had unfortunately misquoted Aaron significantly in the article today. He never stated that we violated copyright law, rather we are settling to resolve litigation. There is no admission of wrongdoing on Bolt’s behalf in the settlement.

    Thanks for the coverage and as always you can reach Aaron or I on AIM to discuss!

    Jay

    Jay Gould on February 12th, 2007 at 8:33 am - Permalink

  7. […] From New Tee Vee  […]

    aligrator - Teen Site Bolt.com Selling Itself Out on February 12th, 2007 at 8:55 am - Permalink

  8. […] GigaOm has the best depth on the story, including that Cohen’s new venture will be called WikiYou and that as well as first round capital, Mayfield had also agreed to invest.   […]

    Bronte Media » Chapter Endings on February 12th, 2007 at 10:34 am - Permalink

  9. […] NewTeeVee reportsのLiz Gannの記事によると、BoltのCEOは今、ビデオ共有はもはや興味あるビジネスではなくなったとして、ビジネスをコンテンツ制作に移そうとしているという。彼がこう述べるようになった経緯は理解できるが、やはり悲しい結末と思える。しかし、これが市場の成熟の結果であるならば、事態はこれより悪くなることもあり得たわけだ。将来、GoFishとBoltから興味あるニュースが生まれてくることを期待したい。 […]

    TechCrunch Japanese アーカイブ » Bolt、Universal Musicへの賠償金支払いのためGoFishに身売り on February 12th, 2007 at 2:39 pm - Permalink

  10. Bolt Exits…

    Silicon Alley old-timer, Bolt.com was sold for $30 million in stock. Congrats to Aaron Cohen, the CEO. I had run…

    Ari Paparo Dot Com on February 12th, 2007 at 4:56 pm - Permalink

  11. […] Bolt.com Selling to GoFish for $30M […]

    NewTeeVee » 2007 » February » 13 on February 13th, 2007 at 12:43 am - Permalink

  12. February 13th, 2007 at 7:41 am

    GOFH,The conference will start @ 8:30 am Tuesday 2/13/07 Pacific time!
    http://www.wsw.com/webcast/mcm5/gofh.ob/

    JJ Stone on February 13th, 2007 at 7:46 am - Permalink

  13. POST-1…Birth of a New Internet Bull Market

    First and foremost, GoFish is the only pure publicly traded online video company in the entire market. As word gets out about the company and its stock, there’s going to be a ton of investment dollars-both institutional and retail-buying this stock.

    Why?

    Because Wall Street desperately wants a piece of the online video market. They got shut out of the room in the YouTube deal. I mean, YouTube was a private company. There was no way for Wall Street or individual investors to buy stock in it.

    But with GoFish, you can.

    The word on the Street is that GoFish will hit $10 to $15 a share in the near term . . . and possibly $20 a share in 12 months’ time.

    This assumes, of course, that GoFish isn’t acquired first by some big media company.

    We’ve already seen this with YouTube, which you know was acquired by Google for $1.65 billion.

    But did you know that other online video and “social networking” sites are being snapped up at huge premiums?

    These sites are hotter than Super Bowl tickets. Take a look:

    • News Corp. buys MySpace for $580 million in 2005
    • AtomFilms acquired for $200 million by MTV/Viacom on August 10, 2006
    • Grouper.com bought out by Sony Pictures for $65 million on August 22, 2006
    • YouTube acquired by Google for $1.65 billion

    JJ Stone on February 13th, 2007 at 7:47 am - Permalink

  14. POST-2…Before I go any further, I’d like to talk about the YouTube acquisition, because financially, it’s not much different from GoFish.

    You see, YouTube was financed mainly by a venture capital firm called Sequoia Capital. They invested roughly $11.5 million in the company in the past twelve months.

    It turned out to be the investment of a lifetime.

    That $11.5 million grew YouTube into a $1.65 billion buyout. We’re talking about a gain of over 14,000%!

    GoFish is pretty much in the same situation. They’ve raised $12 million in financing . . . yet investment bankers were ready to investment 16 times more.

    And it’s easy to see why Wall Street is salivating to get a piece of the action. With traffic to these websites growing every week, advertisement dollars going into online video are expected to grow dramatically.

    ut one of the reasons I really like GoFish is that, in addition to allowing user-generated video (which is the business model of YouTube), GoFish is making itself unique by merging traditional media with cutting-edge Internet broadcasting.

    You see, over the summer GoFish launched an Internet reality show called America’s Dream Date, a Web series that relies heavily on user-submitted video clips.

    The launch was a stunning success, pushing GoFish into the number-four spot for user generated video on the Internet. As a result, GoFish caught the attention of major media.

    On August 3, PC Magazine wrote “. . . some newer forms of networks, such as GoFish, create content to be broadcast exclusively online. Traditional networks like Food Network can run spots on television and on their Web sites to promote online programming, while newer online networks such as GoFish rely on the Web 2.0 culture of share and share alike to promote the show America’s Dream Date, which is a hybrid of The Dating Game and American Idol for the Web.”

    GoFish plans to take the capital raised in financing to develop more proprietary Internet shows like America’s Dream Date.

    This is going to be huge. And I think it spells the beginning of a new bull market in technology.

    JJ Stone on February 13th, 2007 at 7:47 am - Permalink

  15. February 09, 2007
    Publicly Traded GoFish.com: The Next YouTube
    Could it be possible to use Alexa traffic data as a future indicator of the direction of a company’s stock price? We think so, as long as the company’s success is derived from the amount of traffic it receives on its site. Take GoFish Corp. (OTC: GOFH) as an example, a publicly-traded online video company that is ranked in the top ten of all online video sites. GoFish’s Alexa data for the site’s reach rose from 780.5 to 1,845 users per million in just little over a month. How can we confirm that the traffic at GoFish has increased to justify the Alexa ranking? Take the company’s word for it. In a recent press release, the company subtly mentioned that it has now built a community of nearly 6 million monthly unique visitors. In December when we last reported on the stock, GoFish had nearly 2.5 million visitors a month.

    Recently, the company has signed numerous content license agreements, not solely relying on user generated content, to build its online video collection. GoFish has also signed an alliance with Kaleidoscope Sports and Entertainment LLC, to build exposure of the brand and increase advertiser awareness. The company hopes to take advantage of the industry norm of charging a rate of $25 per thousand impressions for ads shown before the playing of its videos.

    The stock has risen from $4.37 in early December to yesterday’s close of $5.63, a nice 22% rise, but hardly reflective of the tremendous traffic growth and potential for that traffic to be monetized. GoFish has a market cap of just around $130 million. More should be known about the company’s results and further growth potential when it gives a presentation at Merriman Curhan Ford & Co.’s IP Video Conference on Tuesday and when it reports quarterly results.

    JJ Stone on February 13th, 2007 at 7:50 am - Permalink

  16. listened to conference. a key point i noted.. with bolt they are 20-25 percent of reported comscore domestic size of youtube… whatever that means?? youtube got bought out for 1.6 billion we are trading around a 125 million market cap. im telling you this can go up 4 times these price levels this year

    JJ Stone on February 13th, 2007 at 9:20 am - Permalink

  17. […] The news is spreading now that Universal and Bolt have reached a settlement — though, the details suggest this isn’t so much of a settlement as it is Bolt effectively paying a ton of money to Universal and more or less shutting down. All of this is despite the fact that Bolt has an incredibly strong legal position. It seems extremely unlikely that a court would find for Universal here — but to continue to fight it is probably prohibitively expensive. Bolt, itself, can’t afford to “fees” it has to pay under the settlement, so it’s selling itself to a much smaller competitor who has some cash it can use to pay off Universal. Bolt’s founders have apparently already moved on to some other startup. Realistically speaking, this is Univeral Music pressuring Bolt out of business (and even getting the company to admit it was “guilty” of violating a law it didn’t break). […]

    Trying to Be like Bill Gates » U.S. warns of possible Qaeda financial cyber attack (Reuters) on February 15th, 2007 at 9:03 pm - Permalink

  18. [...] Isn’t it a little late to start making a name for yourself in online video filtering, what with companies like Bolt already selling themselves to escape copyright infringement lawsuits? [...]

    NewTeeVee » iPharro Peddles Video Fingerprinting on March 6th, 2007 at 3:00 am - Permalink

  19. JJ,

    Wall Street cares about revenue not hype. It also realizes the wave litigation has just begun, not to make money but rather to shift the balance of power to content providers. YouTube was the tipping point and now all Video aggregators are in the cross hairs of the distributors. Unless, the distributors can monetize their content with aggregators they will build their own and/or acquire their internet distribution.

    By the sounds of it, you have an invested interest in GoFish going higher, look at the volume traded, it has dropped 90% a sure sign the stock is out of favor. If there is any prediction to be made, it will one day be a bottom feeder – a true penny stock.

    Lainee on March 16th, 2007 at 10:34 am - Permalink

  20. Cool post on m Selling to GoFish for $30M « NewTeeVee!

    Penny Stock on October 9th, 2007 at 9:47 pm - Permalink

  21. [...] enough to carry Bolt after it was sued by Universal Music Group. Six months after GoFish said it would pay $30 million to buy Bolt and settle the lawsuit, the deal fell apart. Not long after [...]

    GoFish Says Game Over to Online Video « NewTeeVee on January 9th, 2008 at 2:55 pm - Permalink

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