Animoto, a startup that takes a user’s images and music and then automatically creates a video slide show compilation from them, has raised $4.4 million in a round of funding led by Madrona Venture Group. Amazon.com (NSDQ: AMZN) — which had already invested an unspecified amount in Animato a year ago — also participated in the round.
Animoto offers a free basic service but also charges to make higher-quality and longer videos. About 10 percent of its 750,000 registered users pay and the company has been cash flow positive since December. New funds will be used to expand its product offerings. The market is competitive, though, a factor that Madrona Venture Group managing director Matt McIlwain tells TechFlash made the venture firm initially hesitant to invest. Eventually, though, it was impressed enough by the company’s growth to dive in. Release.