The player: Matt Sanchez, CEO and co-founder of VideoEgg
The play: VideoEgg powers online video for social networks and then sells ads across those Web sites. For instance, VideoEgg is the technology that lets users on social network Bebo.com upload and share video. VideoEgg counts 70 sites in its network, including 12 of the top 20 social networks, such as myyearbook.com, tagged.com, AOL’s Uncut Video and military.com. Through its network, the company reaches 65 million unique users each month across those sites. VideoEgg counts about 20 million video views a day across its network of sites. Mr. Sanchez is looking to strike deals with TV networks and music rights holders to make their videos available across the VideoEgg network.
The pitch: While video destination sites such as YouTube and network sites like ABC.com have become homes for Web video, social networks are yet another venue enabling users to publish and pass around video. VideoEgg aims to serve that niche by providing the technology to distribute video and the scale to sell ads across those sites.
The money guys: VideoEgg raised a few hundred thousand dollars from First Round Capital to build its beta service in 2004. The company raised additional money from August Capital and then landed $15 million in funding from Maveron and media and advertising giant WPP late last year.
The WPP investment helps build credibility in the ad marketplace, Mr. Sanchez said. After three rounds of funding, VideoEgg has grown from three employees to 54. VideoEgg makes money by selling ads: It provides its technology for free in exchange for a revenue share of the ad dollars.
The backstory: Mr. Sanchez started the company in late 2004 with two other co-founders. The early goal was to simplify the process of uploading video to the Web. The company has evolved to focus on social networks and selling ads across those sites.
The pros: “The opportunity here is that what you are seeing is an emerging consumer behavior that didn’t exist 18 months ago,” Mr. Sanchez said.
The cons: “The challenges are sorting through all of the content distribution relationships that are necessary. For the first time we are in a place where business models can be worked out for rights holders,” he said.
Background: Mr. Sanchez was born in Medford, Ore., and raised in Pendleton, Ore. He attended Yale University and earned a bachelor’s degree in electrical engineering and computer science. Before VideoEgg, he co-founded MediaLiquid, which matches nonprofit organizations with filmmakers to create PSAs. He is 25 and lives in San Francisco.
Who knew? At Yale, Mr. Sanchez was a founding member of the New Haven FIRST high school robotics team.