A startup called Gfycat (which is pronounced “Jiffy Cat”) has raised a mammoth $10 million seed round to turn its already popular user-generated content platform into a revenue generating concern.
On the content creation side of its business, the startup reports that 2.5 million unique users have already created 25 million “Gfycats,” or short, silent, looping animations and video clips.
Gfycat also boasts 75 million monthly active users on the viewer side of its platform, who watch 1.5 billion user-generated GIFs and clips there per month.
CEO and founder Richard Rabbat said the clips are not technically the same as GIFS. Technically, the company’s site is a Webm host that lets people convert videos into short-form, shareable, looping and fast-loading clips.
“My cofounders and I were avid GIF creators but just found them hard to make, slow to upload, and when you shared them, the quality wasn’t very good. We wanted to make it easier to upload a video, say this is the part I want to turn into a GIF and then to share it,” he explained.
Gfycat is already ranked as a top 100 site in the U.S. by Alexa, however it is not yet generating revenue. A repeat media entrepreneur, Rabbat started the company formally with Dan McEleney and Jeff Harris in 2015.
Today, Gfycat is also making its API available to developers so they, or their users can, upload videos and GIFs from their sites and apps directly to Gfycat.
Rabbat said that the company intends to use its funding to develop more content creation tools for mobile users of Gfycat. The company also intends to build out a native advertising business of sorts.
Alsop Louie Partners, an early backer of Twitch.tv, led the investment in Gfycat joined by Pear Ventures, You and Mr Jones and the Stanford StartX fund along with individual investors.
Alsop Louie Venture Partner Ernestine Fu said with the funding she expects Gfycat to pioneer new, creative ad formats and continue building on their already impressive momentum in user-generated content.
Fu said one major reason she backed the company was because teens and college students in her life well beyond the reaches of Silicon Valley’s tech and venture capital scene knew Gfycat by name and used the platform frequently for fun.
“I see Gfycat as the ultimate platform for all short-form content, the way that YouTube is the platform for longer videos and Twitter is the platform for text-based, news and media discussions,” Fu said.
The company is competing with a huge number of user-generated content sites, creative tools and social media platforms from Photoshop, to Imgur, Giphy and Cinemagram.
But Gfycat demonstrated impeccable timing by rolling out its Webm hosting platform just in time for browser support of GIF-like formats online.
According to Rabbat, the most popular types of content shared on Gfycat have included game-related Gfycats that reflect a user’s in-game achievement (or an animated bit of gamer humor), political videos grabbed from live events or news sources, and cute animal content.
“Maybe not a surprise,” Rabbat said, “but we find users start out the day with cute animals, will look at political stuff at lunch and are creating or looking at games-related content at nights or on the weekends.”
Featured Image: Gfycat