🤑 Smart Money in Creator Economy - March 20 to March 26
Fundraising and exits of the #CreatorEconomy - what happened last week?
Hi, it’s Ange!
Welcome on 🤑 Smart Money in Creator Economy, the new format of Passion & Creator, the media hub about emerging trends in the exciting vertical of the Creator/Passion Economy.
Every week on Smart Money in Creator Economy, receive the last fundraising and exits of the Creator Economy!
Dear investor friends, it’s time to pick new deal flow in it 🤩
Dear founders, discover who invest in this amazing vertical, and maybe in your (next) Creator Economy startup.. 😉!
Feel free to reach out if you’d like to share comments or questions. Don’t forget to like this post above and share it with your friends and colleagues.
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😵 A week full of deals, with a diversity of creator-focused solutions, with AI-generative content, digital fashion, or specialized influence marketing, with $87.6M raised on 10 rounds
🟪 Dorian (2018 / USA 🇺🇸)
#Gaming / #Writing: Women-first platform, enabling writers to turn fictions into interactive visual games and generate revenue from their content
Tipping & direct sales revenue model / B2Creators customer approach
Raised a $14M Series A round
Led by the VC arm of the investment bank The Raine Group,
And followed by the VC firms March Capital, London Venture Partners, Graham & Walker, and the BA network Gaingels.
🟪 RightHub (2021 / UK 🇬🇧)
#Management /#LegalTech: Helps creators connect with IP professionals and manage their IP
Marketplace & SaaS revenue models / B2B & B2Creators customer approaches
Raised a $15M Seed round
Led by the VC firm Firstminute Capital
And followed by the family office Anker Capital and the VC firm Conviction VC.
🟪 DressX (2019 / USA 🇺🇸)
#Web3 / #FashionTech: Enables creators to get access to 3D clothing collections from brands & 3D designers
Direct sales revenue model / B2B & B2Creators customer approaches
Raised a $15M Series A round
Led by the VC firm Greenfield
And followed by the VC firms Slow Ventures and The Artemis Fund, the CVC arm of the entertainment company Warner Music Group, and the DAO-governed VC firm Red DAO.
🟪 Tutti (2018 / UK 🇬🇧)
#Events: Enables creators to book creative spaces in London
Marketplace revenue model / B2B/B2Creators customer approach
Raised a $300k equity crowdfunding round
Gathered on the equity crowdfunding platform Seedrs
🟪 Coqui (2021 / Germany 🇩🇪)
#AI / #Audio: AI-generative speech platform, enabling creators to clone or personalize their voices
Freemium SaaS revenue model / B2B & B2Creators customer approaches
Raised a $3.3M Seed round
From the VC firms ScaleX Ventures, Mango Capital, DNX Ventures, and undisclosed business angels.
🟪 Tavus (2021/ USA 🇺🇸)
#AI / #Video: AI-generative video platform enables users to record a single video, and duplicate in thousands of different versions
SaaS Revenue model /B2C & B2Creators Customer approaches
Raised a $6.1M Seed round
Led by the VC firm Sequoia Capital
And followed by the VC firms REMUS Capital, Liquid 2 Ventures, GTMfund, Mantis Capital, Hack VC, Terra Nova Ventures, Accel, Index Ventures, Lightspeed Ventures, Soma Capital, the accelerator Y Combinator, and the BA network SV Angel.
🟪 SphereTrax (2022 / UK 🇬🇧)
#Music / Management /#Web3: Web3-powered music licensing marketplace ensure musicians and music IP owners are notified and paid instantly when their IP is used in commercial content formats.
Marketplaces revenue model / B2Creators & B2B customer approaches
Raised a $305k Pre-Seed round
Led by the Fund management firm Jenson Funding Partners
🟪 OP3N (2021 / USA 🇺🇸)
#Web3: Enables artists and creators to offer fans new ways to engage through NFT gated experiences
Transaction-based fees revenue model / B2C & B2Creators customer approaches
Raised a $28M Series A round, at a $100M post-money valuation
Led by the CVC firm Animoca Brands
And followed by the VC firms Dragonfly Capital, and the Temasek's web3 VC arm SuperScrypt, the NEA-CAA's VC joint venture Connect Ventures, the crypto exchange platform Republic Crypto, the CVC firms Avalanche’s Blizzard Fund, Galaxy Digital, Warner Music Interactive.
🟪 Loupe (2016 / USA 🇺🇸)
#Art / #Livestream: Helps digital artists to exhibit, sell and distribute their artworks, and enbales the clients to livestream their acquired artworks.
Marketplace revenue model /B2C & B2Creators customer approaches
Raised a $3M Seed+ round
Led by the VC firm ALIAVIA Ventures
And followed by the H/L Ventures’ VC arm CityRock Ventures, the VC firms Goal Ventures, Phoenix Capital Ventures, SoundMedia Ventures, Yolo Investments, and the BA network Atlanta Technology Angels.
🟪 MOGL (2019 / USA 🇺🇸)
#SportTech / #InfluenceMarketing: Connects student-athletes and brands for influence partnerships
Pay-As-You-Use revenue model / B2B & B2Creators customer approaches
Raised a $2.6M Seed round
Led by the VC firm Magarac Venture Partners
And followed by the VC firms PivotNorth Capital, Chaos Ventures, Litquidity, the media company Penske Media Corporation, the BA network Sand Hill Angels, Platform Venture Studio, and the NFL player Minkah Fitzpatrick.
We will find the new 10 deals with the other 55 listed deals of 2023, in the new Creator Economy deals database:
NB: I am currently on a last check on the deals of 2022. Once finished, you’ll have you access of all deals of 2022 (+480 deals, +470 companies, +590 investors and +20 buyers)!
Let’s unbundle the Big 4 of the video business 📱.
When you think about video, what the first thing I think about? YouTube, TikTok, Snapchat, Instagram. The “Big 4” represents literary the most used platforms to create and consume video content on every kind of subject. Basically, the video library of these platforms is so large, that it as common that to say now that “you could learn everything on YouTube”, and “search everything on TikTok”.
These four platforms combined, offer a end-to-end experience to record, edit, distribute and monetize their creations, and gathers all the attention of the users for their catalogue of content and their frictionless UX. YouTube gathers 2.5B monthly active users, 15M “YouTubers”, and a daily watch time of 250M hours. And, it's just YouTube… This a big $$$ cake, and some entrepreneurs decided to break into this game and take their piece.
How and where these players of the video market find spots to better serve the creators, generate value and a sustainable business? Let's see unbundle YouTube, TikTok, Snapchat and Instagram.
The first step of the value chain is the video recording. Several options are available for the creators to help them record some videos. The first option is obviously to go to the classic solutions, like IG or TikTok for the short format, and YouTube for the long one.
But other players offer good alternative options, like Riverside or Rumble, that present interfaces to filming the creators. In addition to these solutions, Protégé enables creators to have feedbacks about their videos from high-level creators and celebrities, in order to improve the video recording.
The second option is to improve the recorded content. In answer to that, the creators could use the VR/AR to develop 3D experiences for their audience, like InterApp, LIV or Immerse, or add the digital avatars use in their videos. The latter solution is the creation of digital avatars, in the VTubers trend, which is when the creator uses a layer of VR to hide his face and let the floor to a character they develop upon them, and that people could be close; or to completely develop a full-fictional character that could hold livestreams. This trend is growing, and several solutions like DNABLOCK or Rephrase help creators create their own digital avatars for videos.
Beyond the possibility to improve the content or to create new characters, the AI-generative trend enables creators to develop entirely new videos from text prompts, and piece of video content to develop a series of original videos like Tavus.
The second step, the video editing, is powered by two ways: the vertical short videos, directly embed editing features in the app, Snapchat was the birthplace of this feature, and the filters, but now other short-video creation solutions have this feature. We have on left side the independent editing solutions, gathering tools like slow-motion, frame interpolation or green screen use, and transcriptions like Lightricks, Descript or Vochi; and on the right side the new AI-powered solutions, adding a AI-generative layer and build videos from a piece of content, like a picture or text prompt like Tavus.
On the third step, the video distribution, the opportunities are mainly factor of coverage. We have the generalist solutions the major apps we all know for short content (IG, TikTok …) and for long formats like Rumble. Aside the generalist solutions, we have the specialized ones: the web3-powered solutions like Livepeer; the vertical-focused like the food video app for chefs & food creators Flavrs, or the gaming videos Freshcut, and the geographical-oriented solutions like Chingari, the “Tiktok for India”.
At last, the last part of the value chain is the video monetization. On this part, three different options are on the table for the video creators.
The first option is to monetize the content by the first and oldest way to push a user to pay for a video: gain knowledge! So a creator could monetize its content by putting a paywall on a series of videos, like on PressPlay or Xip, with a fixed or recurring amount. If the learning videos are not in the spotlight, the second opportunity is, like for consumer TV solutions, use the VOD option and setup a pay-per-view payment solution on each video created & broadcasted by the creator.
The second option is the monetize their videos thanks to the blockchain. The creators could monetize their videos by convert them as NFTs like Glass, and tipping the creators with fungible tokens like FreshCut.
The third option is coming from a basic of the Creator Economy: the brand partnership. On this way, two opportunities are for the creators: the old fashioned way, where the platform just matches UGC with brands, to create branded videos, or follow the hot trend of this year: the AI-generative content. Rembrand offers the possibility to embed AI-generative product placements, so that the creator ujst have to focus on added-value content, the software will do the rest 😉. Jellysmack, on its side, offers to big creators to co-develop videos & share revenue.
The last one is to find funding to expand the video creation activities, so that the value proposition of the Video Revenue-Based Financing (RBF) is the best one, with solutions like Spotter, Animaj, or Electrify Video Partners for the lastest funded ones. The value proposition, tailored only for the most performing YouTubers, enables them to “borrow” money from these specialized platforms, in exchange of sharing the share of the revenues coming from their existing portfolio.
What could we keep from this review?
The range of solutions is very wide, and some solutions position themselves on several parts of the process, like Doing Things Media on the distribution and monetization or Rumble from the recording to the distribution. Others prefer the hyper-specialisation like FreshCut on gaming video distribution, or Glass on web3-powered monetization.
The second point is the road is always full of pitfalls on how the video value chain could generate a sustainable business: the best example is the learning platform for “by children, for children” videos Tract, which closed down the January 1st, 2023, after a launch in the midst of the Covid-19 crisis in 2020, and achieved to gather a community of 30k+ members on 20 countries, and raised 2 investment rounds for a total of $9M with A-list investors like Bessemer or New Enterprises Associates.
However the market is huge: the global video streaming market was globally evaluated at $89B last year, the short videos platforms market at $1.1B with a 10% yearly growth. And we don’t even see the potential of new and cross-market areas like videos-focused RBF or AI-generative videos, so it will be interesting in the future if the market will go to concentration like Spotify has done on the podcast market, and which sub-verticals will suffer the same fate as Tract, and which ones like gather the success around them like the vertical & short videos of TikTok.
I let you with this mapping covering all the startups of the video value chain that have raised money in 2022 and 2023 😉.
🖋 Want to know more info about these companies: click here to have access to the database
🥇 Which are the most active corporate VC firms & companies?
Let’s pursue our review of the most active investors by investor nature.
After reviewing last week the most active business angels, today will be focused on the VC arms of companies. This other side of the venture capital investing is powered by the companies, scale-ups or corporates, that are willing to invest in startups, mainly for strategic acquisitions, or a lesser way, in a objective of financial returns.
They are built in two possible ways: the first one is the independent entity called the corporate venture capital firm (or CVC) that have their own public presence on the market; and the corporate development, or investment team departments of companies that have the right to invest in companies but cannot have their own public branding. It could seem trivial, but one of the assets of an investor is the personal branding, to attract highly qualified dealflow. So, not be able to have a “free” public presence of the market could have an impact, positive if the corporate brand is very high, or negative if the corporate brand is pretty “confidential”.
So,like in the VC area, that I’ve shared on LinkedIn 3 months ago, the structuration seems be the same: a big leader, followed by ever-widening layers of investors.
Let’s see!
🤝 The Mega CVC of the Creator Economy | 20+ investments
Animoca Brands: 36 deals - including a deal since January 1
🤝 The Super CVC of the Creator Economy | Between 10-20 investments
Coinbase Ventures, from Coinbase: 12 deals - including a deal since January 1
Dapper Labs: 10 deals
Polygon Studios: 10 deals
🤝 The very active CVC of the Creator Economy | Between 5-10 investments
Polygon: 8 deals
CoinFund: 7 deals
Galaxy Interactive - from Galaxy: 7 deals
Galaxy Digital - from Galaxy: 6 deals
Gemini Frontier Fund - from Gemini: 6 deals
Samsung NEXT - from Samsung: 6 deals
Delphi Digital: 5 deals - including a deal since January 1
Jump Crypto: 5 deals
BH Digital - from Brevan Howard: 5 deals
OpenSea Ventures, from OpenSea: 5 deals
Protocol Labs: 5 deals
🤝 The Creator Economy-friendly CVC | 4 investments
Avocado Guild: 4 deals - including a deal since January 1
GSR Markets Limited: 4 deals - including a deal since January 1
Krafton: 4 deals - including a deal since January 1
The Sandbox: 4 deals
Binance Labs - from Binance: 4 deals
Electric Feel Ventures - from Electric Feel Entertainment: 4 deals
A point could be underlined: the impact of the FTX scandal of 2022 has impacted a lot the web3 ecosystem, and the Creator Economy has not been spared. In fact, aside from stealing money from clients, the FTX team has used the money to invest in companies, creating big issues for their portfolio companies about how to deal with that for the next funding rounds.
👮 The impact of FTX scandal
Alameda Research - from FTX: 11 deals
FTX Ventures - from FTX: 8 deals
🖋 Want to know more info about these investors: click here to have access to the database
That’s it for today!
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Ange Michael AHYI