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Summary:

Mobuzz, a four-year-old Madrid-based web studio, says the economic downturn has starved it of the €50,000 ($65,235) it needs each month to run the company and has pitched its users a call for €120,000 Euros in donations by this weekend to keep its five daily shows […]

thermo_uk_bigMobuzz, a four-year-old Madrid-based web studio, says the economic downturn has starved it of the €50,000 ($65,235) it needs each month to run the company and has pitched its users a call for €120,000 Euros in donations by this weekend to keep its five daily shows up and running.

The company’s three tech news shows are five-minute roundups along the lines of Webb Alert and Rocketboom but in localized Spanish, English and French editions. In March, Mobuzz also launched separate Spanish gossip and news shows, bringing its total production run to 100 shows a month.

While advertising revenue is growing — €250,000 so far this year, up from €80,000 in 2006 — founder Anil De Mello said, it doesn’t cover salaries for the 16 staff or the company’s distribution, hosting and content delivery budgets. De Mello, who has largely bootstrapped Mobuzz with the help of angel funding and advertising revenue, said an investment round that appeared set to go ahead in September fell through because of the financial crisis. The economic downturn also prompted Mobuzz’s original investor to pull out.

At four years old, the videoblog is a grandaddy, and with several major industry awards under its belt it has definitely already found its feet. There are about 2 million downloads of Spanish content each month from the Mobuzz site, 1.5 million downloads of the English show and 300,000 of its French counterpart, according to De Mello. The YouTube editions of the shows get around 500,000 total views a month, he said.

The call for help is a clever pitch to a loyal audience, and a purely user-generated revenue stream isn’t a new idea. But during our conversation De Mello also said the company could, with new funding, be profitable by early 2009, and that it’s already talking to potential investors, including a major media company in Spain (he wouldn’t give specifics). That promise of new funding suggests user support will be more of a vital stopgap measure for an old hand, rather than a new revenue model for a stripling show.

That said, the outpouring of donations — around 14 percent of the target amount within a day — has had De Mello reconsidering a subscription-based revenue model. He said he’s been surprised by the outpouring of support — Europeans aren’t typically as culturally predisposed to charitable giving as Americans are, he noted.

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  1. Gonzalo Martín Saturday, November 8, 2008

    “Europeans aren’t typically as culturally predisposed to charitable giving as Americans are, he noted.”

    The fact is that a significative part of Spanish audience is criticising the “save me” initiative by donations. Many other have, however, given their money, but nobody expect Mobuzz hits the target in just one week. As a matter of fact, right now they’ve got only 25% of the needed amount.

  2. Hah! 80.000€ in ads? Then their filed company balances for fiscal year 2006 are lying. They show a total revenue of some 35.000€. Wonder how they are going to multiply this figure by almost 10x with the current advertising downturn. Their site traffic stats don’t paint a prettier picture.

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