Metacafe Founders Cash Out


The Metacafe founders, who were no longer involved in day-to-day operations of the company, have reportedly cashed out their shares in the company, each taking home a $2.5 million payday. This information comes from the Israeli paper TheMarker, as written up by TechCrunch.

Co-founders Arik Czerniak and Ofer Adler each reportedly held a fully vested 2.5 percent of Metacafe, which was valued at $50 million for the purposes of the transaction. They are no longer involved with the company.

Even at the time, in December of 2006, it seemed like a rumored tentative offer from Yahoo (we had heard anywhere from $200 to $700 million) was the best Metacafe was going to get. But the company held out, and acquisition talks fell apart.

A few months later, a new CEO was hired, and by last summer, the company had raised expectations again by collecting another $30 million in venture capital. It was at that time Metacafe said Czerniak would no longer have an operating role.

Here’s a time capsule from last February, when we wrote about Metacafe hiring its current CEO Erick Hachenburg.

Now is the time to sell a video-aggregating startup. Scuttlebutt says the window is closing, with companies like eBaum’s World failing to find a buyer despite their efforts. Many had thought the window was already good and shut, unless Metacafe could close its much-rumored acquisition by Yahoo or someone else. Valuations appear to be getting lower even if traffic isn’t headed south, what with lawsuits and maneuvering by the GooTube juggernaut.

Hachenburg told us a few months ago that the way Metacafe differentiates itself from other video aggregators is its singular focus on user-generated content. The site has an active revenue-sharing scheme with its creators. Its traffic is growing, but not by much.


Michelle Cox

Hi, Michelle from Metacafe here.

This matter is, of course, personal and private to the individuals. But we appreciate Arik’s contributions as the founding CEO and Ofer’s early support as an investor. We are glad we came to an amicable parting, with the support of our existing investors, the Metacafe team, and founder and Chief Product Officer Eyal Hertzog.

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