Socialcam, Just 18 Months Old, Is Acquired
Socialcam has a new reason to smile and say "cheese."
The popular video-sharing app, which has more than 56 million monthly users, has been acquired for $60 million by Autodesk, a 3-D design software company.
Like Instagram, Socialcam allows users to capture video on their phone, add a filter--say black and white, or sienna--and broadcast to their social networks. Also like Instagram, the company has yet to earn revenue.
Michael Seibel, Socialcam's founder and CEO, says the decision to sell to Autodesk will give his 18-month-old start-up (which has just four employees!) the ability to reach a broader audience.
"Partnering with a bigger company allows us to address the long-term opportunity, and gets us out of minute-by-minute start-up roller coaster," he told AllThingsD. "A year from now, I want the majority of your friends taking one video per week." Seibel added Socialcam will operate "mostly" independently from Autodesk, but with the backing of the company as a corporate parent.
While Seibel contemplates the future of Socialcam, the company's angel investors, which include Tim Draper, Ashton Kutcher, Brian Chesky, Alexis Ohanian, and Justin Kan, will no doubt be celebrating the more short-term reward. After all, the company, which launched in February 2011 as a spinoff from Justin.tv, Justin Kan's live broadcasting start-up, raised its first round in April of 2012. A full list of Socialcam's start-studded angel list can be found here.
Kan, who co-founded Socialcam with Seibel, officially left his day-to-day duties at the company in February 2012 to start Exec, an online outsourcing service.
Socialcam was hot from the get-go. Unlike Instagram, which only grew successful after pivoting from a more stodgy concern, Burbn, Socialcam blasted expectations and goals on Day 1. In its first four months, the app had one million downloads, and 32 percent of users that downloaded the app became active users.
"Over the past 90 days we've gone from maybe 15 servers to maybe 150 servers," says Seibel in an interview with Inc. "It was a ton of work. I've never worked this hard in my entire life. But it's also been ridiculously fun."
Given the app's overwhelming popularity--it is currently the No. 1 Facebook app and in the top 40 iPhone downloads--there had been rumors of a potential acquisition from Google or Zynga. The acquisition by AutoDesk, then, which is a service-based b2b company, signals the firm's foray into the consumer market.
"There is no limit to how much people want to show off their work," Carl Bass, Autodesk's chief executive, told The New York Times. "We're trying to tap into a vein of human creativity."
Recently, Seibel was asked in an interview: "What's the most important action you took that you believe brought success to your business?"
His answer: "Deciding to start," he said. "This is the step that prevents 99.9999 percent of business from succeeding."