Joost, the once-hot peer-to-peer Internet TV firm, raised $45 million in 2006 from a star-studded roster which included CBS (CBS), Viacom (VIA), Sequoia Capital, Index Ventures and Hong Kong billionaire Li Ka-shing. It has burned through much of that building its service around a software download that consumers didn’t much care for.
Now Joost is re-tooling its tech platform with a Web-based service, which should make it more appealing. But it’s certainly going to need more cash. So which of its initial investors will re-up? And who else can the company convince to take a flier?
It sounds like Viacom is taking a pass. As CEO Phillippe Dauman told PaidContent, “We did recieve equity in connection with our original deal and we’re happy where we are.” CBS’s Quincy Smith has also sounded ambivalent about Joost’s prospects, and with CNET, he’s got a lot on his plate.
There is plenty of money still pouring into video startups: $217 million in the first quarter alone. And plenty of that has gone to startups with even more limited prospects than Joost (see TidalTV). Joost also isn’t alone among video sites needing more cash: Veoh, another high-flying video startup that has raised $40 million to date, is out raising another $40 million.
What does Joost have going for it? Distribution deals with lots of media players, big and small. But the farther we get into the Web video era, the less impressive that looks: Many of the big content players are now happy to distribute their stuff widely on the Web, and seem happy to jump from portal to portal to find it, if necessary. This is a business that looked exciting in 2006, but much less so now.
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