The China video website saga continues:
Last week Danwei reported that Ku6.com, one of 247 government approved video websites, had received US$30 million in new funding.
China’s biggest three video websites, 56.com, Tudou.com and Youku.com have not got formal government approval (see Danwei story).
56.com has been shut down since early June and is apparently moribund because it just couldn’t get on with government regulators (see Kaiser Kuo: A Funeral Dirge for 56.com?.
Despite the lack of formal government approval, Tudou and Youku continue to operate. Youku yesterday announced that they had received USD 30 million in new funding.
Below is the full text of their press release.
Youku.com Inc. Raises US$30 million equity financing and US$10 million equipment loan
Beijing, China – July 1, 2008 – Youku.com Inc., the leading online video website in China, today announced that it has raised an additional US$30 million in private equity funding, and secured a US$10 million equipment loan, to further expand its leadership position.
Maverick Capital led the financing round and joined the Board of Directors. All existing investors in the company, including Brookside Capital, Sutter Hill Ventures, Farallon Capital, and Chengwei Ventures, participated. The US$10 million equipment loan is provided by Western Technology Investment, which has provided venture debt to leading internet companies such as Google and Facebook.
“This investment will enable us to advance the company’s rapid growth, expand our sales and marketing network, and most importantly, accelerate our monetization process as the online video market matures and consolidates in the coming year.” said Victor Koo, President and CEO of Youku.com Inc. “With the new funds, we will be deepening our service to users, advertisers and media partners to give them the best and largest platform in China to distribute video content online.”
Youku is the #1 online video website in China as measured by third party organizations such as iResearch, Baidu user index and China Internet Society/Data Center of China’s Internet, etc. It has attracted over 100 million unique visitors per month and each user spends about 300 minutes per month on Youku. Based on iResearch’s May 2008 report, Youku is now the #6 largest website in China in terms of total user time spent. Youku has attracted over 60 global and local brands to advertise on the site since the Company started focusing on monetization this year.
“We are happy with Youku’s success and its progress in monetization,” said Len Baker, managing director of Sutter Hill. “The Youku team has clearly demonstrated its excellent execution capability, and we believe Youku is in the right position as online video takes off on a massive scale in China.”
Besides closing a new round of financing, Youku also announced it has entered into content cooperation partnership with over 100 traditional media groups including Shanghai TV, Beijing TV, Jiangsu TV, China Film Group, Universal Music, EMI Music, Huayi Music and a large number of top film, TV and music performers in China.
Previously, Youku had raised US$40 million in private equity funding from Sutter Hill, Farallon Capital, Brookside Capital, Chengwei Ventures.
About Youku.com
Youku.com (www.youku.com) is the leading video sharing website and premier online video brand in China. It is one of the top destinations for Chinese people to watch and share videos all over the world. In addition to user-generated content, Youku.com also works with more than 150 professional media partners to distribute online videos in China. Youku.com was officially launched in December 2006 and has grown rapidly since. Youku.com delivers more than 150 million daily video views as of June 2008 and total user time spent exceeded 30 billion minutes per month.
About Maverick Capital
Maverick Capital, Ltd. was founded in 1993 and has been registered with the U.S. Securities and Exchange Commission as an Investment Adviser since 1994. Maverick manages more than $12 billion in equity capital. The firm’s investors are primarily endowments, pension funds, foundations, and other institutions.
About Sutter Hill Ventures
Sutter Hill Ventures has financed technology-based start-ups and assisted entrepreneurs in building market-leading companies since 1962. The oldest venture capital firm in Silicon Valley, they have invested over 350 technology and medical start-ups and created over $100 billion in market value.
About Brookside Capital Partners & Bain Capital
Brookside Capital Partners is an investment fund affiliated with Bain Capital, a leading global private investment firm with approximately $75 billion in assets under management. Formed in 1996, Brookside invests across a broad spectrum of industries including media & telecom, healthcare, consumer, industrial and financial services. Each investment is based on fundamental analysis of the company’s business by professionals who are sector focused. Headquartered in Boston, Bain Capital has offices in Hong Kong, Shanghai, Tokyo, New York, London, and Munich.
About Farallon Capital
Farallon Capital Management, L.L.C. is an investment adviser registered with the U.S. Securities and Exchange Commission. The firm manages more than $35 billion equity capital for institutions and high net worth individuals, and its institutional investors are primarily college endowments and foundations.
About Chengwei Ventures
Chengwei Ventures, based in Shanghai, is one of the first independent venture capital funds and the only evergreen private equity fund to operate in China. Chengwei was founded in 1999 for the purpose of investing in high-growth potential companies in a variety of industries including communication software, IC design, niche component manufacturing, healthcare and media.
About Western Technology Investment
Western Technology Investment (WTI) is a leading provider of debt financing to start-up and emerging growth companies. Founded in 1980, WTI is exclusively focused on venture debt and has substantial follow-on capacity for portfolio companies at all stages of development. Previous portfolio companies include Juniper Networks, Brocade Communications Systems, Google, Cerent, Infoseek, IDEC Pharmaceuticals, Facebook, IronPort Systems, Volcano Corporation, and many others. WTI has completed over 800 financing commitments totaling over $2.4 billion since inception.