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Summary:

The Chinese video market is currently much more volatile than ours in the U.S., with startups scoring huge rounds of funding to compete for a rapidly growing broadband userbase, but also facing the risk of closure if they can’t get on good terms with the government. […]

The Chinese video market is currently much more volatile than ours in the U.S., with startups scoring huge rounds of funding to compete for a rapidly growing broadband userbase, but also facing the risk of closure if they can’t get on good terms with the government. With this much money in the game, someone’s going to get hurt. But in the last week alone, news emerged that Chinese video-sharing site Youku and Ku6.com both raised at least $30 million.

Youku said today it had raised $30 million from Brookside Capital Partners, Sutter Hill Ventures, Farallon Capital and Chengwei Ventures. That’s in addition to a recent $10 million loan from Western Technology Investment. (Sample video embedded above.)

Youku told Pacific Epoch the funding would be enough for more than one year of operation. That estimate, though vague, adds validity to Eric Eldon’s report at VentureBeat that the company was spending $2 million per month to stay in business. Youku has now raised a total of $80 million.

Pacific Epoch is also reporting that another Chinese video-sharing site, Ku6.com, will announce the completion of a Series C round of $30 million this week. The company had previously raised at least (and thought to be much more than) $10 million from Baidu, Draper Fisher Jurvetson, and DT Capital Partners. The company is reportedly adding staff for running user-generated advertising and original content programs.

Ku6 is one of the video sites reported to have been given permission to operate by the Chinese government, while market leaders Tudou, Youku and 56.com have not. 56.com seems in especially dire straits; it has been offline for most of the last month, and some are reporting that government pressure may be driving the company out of business.

  1. Hi,
    Video sharing is all the rage these days. We all want to share our videos, to share our passions and the things we like. There are so many sites around to publish our videos on the web that it is sometimes hard to make a choice. We know some of them like YouTube, Revver or Dailymotion, but there are so many others competing to be the number one, or targeting a specific audience, whether geographically (China, Japan, Turkey…), by language (German, Arabic, French…) or for the kind of content they enable to publish (cooking, planes, extreme sports…).
    I have compiled a growing list of more than 700 video sharing sites, video search engines, and video download sites that you can check at http://www.ilikesharingvideos.com
    For each of them, you will get useful information such as their history, the country from which most of their visitors come, their niche, their rank, their latest news…
    This site offers some other interesting features, like a forum about online videos, how to make money with your videos, how to create your own YouTube site, etc.
    So if you are interested in video sharing or online video marketing, give an eye to this site, it worths it.
    Cheers

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  2. Wow, I never would’ve actually thought they were such big players. Sure, I’ve seen Youku around, but it’s surprising how much money it’s raised.

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  3. [...] Youku has raised $110 million, including $30 million with an additional $10 million loan in its last financing round in June [...]

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