Written by Liz Gannes
Posted Thursday, April 24, 2008 at 9:00 PM PT

Exclusive: U.S. Online Video Startups Raised $461M in 2007

Profits may not have arrived for online video, but venture capitalists are still happy to pick up the bill. More and more U.S.-based, venture-backed online video companies are attracting more and more financing each year, according to Dow Jones VentureSource. Some $460.5 million was invested in such startups in 2007, up from $266.9 million in 2006. And already, in the first quarter of 2008, another $217.3 million rained down on the category.

In 2007, the money was spread among 68 startups for an average investment of $6.8 million each. That’s compared to 51 startups in 2006 and $5.2 million each, on average. This year, 29 startups have already received funding, and the average amount is on the upswing, too, to $7.5 million. That’s the opposite of broader trends; in the first quarter of 2008, venture funding was down 8 percent year-over-year and 9 percent quarter-over-quarter.

Based on previous years’ data, the first quarter is one of the smaller investment periods in the sector, but then again a troubled economy could slow investment in this economically risky category as 2008 wears on.

Dow Jones was nice enough to run a custom study for us, following up on the 2006 numbers we’d reported on last April. However, this time the firm used a more specific methodology to focus on online video, excluding IPTV platforms and general advertising companies (for instance, two companies included last year were Kasenna and Imagine Communications, not things we’d write about on NewTeeVee).

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Topic: Money & Power

Comments (6)

Hey NTV guys, would be a great article if you could take that 471M and break it down to who the top VC investors were in online video. There are a few big players and then a bunch of little guys and would be great to get this info out there.

Pablo — 8:01 AM on April 25, 2008 Reply
Good idea Pablo. Will take a bit of work but we can try to do that for you soon.

Liz Gannes, NewTeeVee — 8:08 AM on April 25, 2008 Reply
Ya thats crazy. Check out the stage6 replacement at http://www.setvid.com

SetVId — 2:11 PM on April 25, 2008 Reply
I wonder if that money includes adult tube sites. I wonder if they are able to profit as much as the mainstream. Great stats none the less.

Quiz Wiz — 2:58 PM on April 25, 2008 Reply
2007 was a good year :-0

Gordon Page — 5:35 PM on April 25, 2008 Reply
Thank you for this article, which is very helpful!

gry logiczne — 9:29 AM on September 21, 2008 Reply

Linkbacks (15)

[...] all over the place, converting dead loans into dead funds, VCs are still investing in online video. NewTeeVee reports some nice numbers: “This year, 29 startups have already received funding, and the [...]

gertis.media » Blogarchiv » VCs… — 1:53 AM on April 25, 2008
[...] Edit Staff, Thursday, April 24, 2008 at 9:01 PM PT Comments (1) Profits may not have arrived for online video, but venture capitalists are still happy to pick up the bill. More and more U.S.-based, venture-backed online video companies are attracting more and more financing each year, according to Dow Jones VentureSource. Some $460.5 million was invested in such startups in 2007, up from $266.9 million in 2006. And already, in the first quarter of 2008, another $217.3 million rained down on the category. NewTeeVee has the exclusive. [...]

Exclusive: U.S. Online Video Startups Raised… — 3:35 AM on April 25, 2008
[...] biz so lots of money pouring in obviously to try to capitalize… Newteevee.com has the story here Posted by brooks Filed in [...]

blogteq » Blog Archive » Online… — 11:06 AM on April 25, 2008
[...] Exclusive: U.S. Online Video Startups Raised $461M in 2007 « NewTeeVee Shakeout looms! (tags: online video youtube) [...]

Television Archiving » Blog Archive… — 3:32 PM on April 26, 2008
[...] Read More at NewTeeVee – Exclusive: U.S. Online Video Startups Raised $461M in 2007 [...]

Here Comes The Money - $217 million raised… — 4:34 AM on April 28, 2008
[...] NewTeeVee Profits may not have arrived for online video, but venture capitalists are still happy to pick up the bill. More and more U.S.-based, venture-backed online video companies are attracting more and more financing each year, according to Dow Jones VentureSource. Some $460.5 million was invested in such startups in 2007, up from $266.9 million in 2006. And already, in the first quarter of 2008, another $217.3 million rained down on the category. [...]

Exclusive: U.S. Online Video Startups Raised… — 1:49 PM on April 28, 2008
[...] NewTeeVee reports that $461 million in venture funding was put toward online video startups in 2007 [...]

Kelsey Group Blogs » More Online Video… — 2:13 PM on April 28, 2008
[...] “Profits may not have arrived for online video, but venture capitalists are still happy to pick up the bill. More and more U.S.-based, venture-backed online video companies are attracting more and more financing each year, according to Dow Jones VentureSource. Some $460.5 million was invested in such startups in 2007, up from $266.9 million in 2006. And already, in the first quarter of 2008, another $217.3 million rained down on the category.” Story here. [...]

social cache: we deal in uncommon cents.… — 4:41 PM on May 9, 2008
[...] on throughout 2008 as in the first quarter, this year’s spend may double yet again (taken from NewTeeVee.com ). SUCCESS [...]

Flypaper.tv » Blog Archive »… — 11:55 AM on June 2, 2008
[...] spending by online video companies (huh? where were you when those checkbooks were opened? VCs spent $461 million on this space in 2007 alone) and video views were down slightly in April (though I don’t [...]

Internet’s Least-wanted Gig: Online… — 7:39 AM on June 18, 2008
[...] what did last year look like for VC funding in the online video space? NewTeeVee gave these stats for [...]

Online Video Advertising Funding | Editechial — 9:47 PM on June 19, 2008
[...] online video startups raised $461 in venture capital in 2007 — up from $267 million in 2006 — yet many of their half-baked business plans are [...]

Can Online Video Support Its Next Generation… — 8:05 PM on August 13, 2008
[...] online video startups raised $461 in venture capital in 2007—up from $267 million in 2006—yet many of their half-baked business plans are already going [...]

iJustine part of the new online video phenomenon… — 3:50 PM on August 18, 2008
[...] for online video sites has been on the rise. It nearly doubled between 2006 and 2007, from $266.9 million to $460.5 million. In just the first quarter of 2008 alone, over $217.3 million [...]

Broadband Developments - Unified Communications… — 8:54 AM on October 22, 2008
[...] this: Funding for online video sites has been on the rise. It nearly doubled between 2006 and 2007, from $266.9 million to $460.5 million. In just the first quarter of 2008 alone, over $217.3 million [...]

HipMojo.com » Online Video: Recession… — 11:44 AM on October 22, 2008

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Exclusive: U.S. Online Video Startups Raised $461M in 2007

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