Digital Dealmakers: Greg Kostello

Apr 2, 2007  •  Post A Comment

The player: Greg Kostello, CEO and founder of VMIX Media, an online video site and service

The play: VMIX provides both a destination, at VMIX.com, and the technology for media companies to promote and deliver their TV programs on the Web. VMIX also provides community tools for content owners to build social networking features alongside their online videos.

The pitch: VMIX aims to help media companies, artists and individuals maximize their content on the Web. Mr. Kostello believes VMIX stands out because it can deliver video on its site or a company’s site and because VMIX provides community interaction tools for blogs, forums and user-generated submissions. “We have a client now and we replaced four vendors for them,” Mr. Kostello said. VMIX technology protects copyrighted material and monitors content for unauthorized material.

In the mix: VMIX’s customers include NBC, Fox, Discovery and others. For instance, NBC hosts and controls a customer channel on VMIX.com with video and promotional clips from “30 Rock,” “Heroes,” “Late Night With Conan O’Brien,” “Scrubs” and “My Name Is Earl.” Network partners choose the look and feel for their channels. VMIX also features a “continuous play” button so users can watch videos in a lean-back fashion, Mr. Kostello said. The fate of small companies such as VMIX is unclear in the wake of the creation of a joint venture between NBC Universal and News Corp. to distribute their films and TV shows across the Web. But Mr. Kostello is hopeful that VMIX will remain useful. “The value that NBC gets on our site is promotion,” he said.

The money guys: Mr. Kostello founded VMIX in 2005. In 2006, venture firms Mission Ventures and Enterprise Partners funded the company in two rounds for an undisclosed amount. VMIX makes money by licensing its software to media companies and selling custom channels and promotional marketing campaigns. Mr. Kostello expects VMIX to become profitable by the end of next year.

Backstory: Mr. Kostello was born in Chico, Calif., and grew up on a small farm nearby. “When I went to San Francisco as a kid I realized I didn’t want to stay on the farm,” he said. He earned a bachelor’s degree in computer science from the University of California at Irvine. He is now 42 and lives in San Diego with his wife and daughter. Prior to founding VMIX, Mr. Kostello served as an executive at Vivendi-Universal and MP3.com.

Who knew? When Mr. Kostello started college, he intended to major in political science and become a lawyer. But one day while hanging out in the computer room, he decided he liked engineers more than lawyers. He switched majors.