Meerkat raises cash from Greylock and Hollywood
Livestreaming app Meerkat has raised a round of funding led by Greylock Partners, the company said. The amount and valuation were not disclosed.
Given Meerkat’s recent popularity, the company likely had its pick of investors. The ones it chose show Meerkat wants close ties to Hollywood. Meerkat’s investors include:
- Sound Ventures, the investment arm of Ashton Kutcher and Guy Oseary
- Jared Leto
- Vayner/RSE, the investment firm of Web personality Gary Vaynerchuk
- Universal Music Group
- Broadway Video Ventures, the venture arm of Lorne Michaels’ media company
- William Morris Endeavor, the talent agency
- CAA Ventures, the investment arm of talent agency CAA
- UTA, a Beverly Hills talent agency
- Chad Hurley, co-founder of YouTube
- David Tisch
- Raine Ventures
- Comcast Ventures
- Slow Ventures
Greylock Partner Josh Elman, who backed consumer Web startups such as Path, Medium and Nextdoor, will join Meerkat’s board of directors. “It feels like we are at the dawn of a new era for live video,” Elman wrote in a blog post. Meerkat has scheduled a livestream on its own app titled “Announcing our funding.” Watch it at noon eastern time here.
In just three weeks, Meerkat has worked Silicon Valley into a fever-pitch. The livestreaming app went viral just before the South by Southwest festival and more or less “won” the event.
Shortly after, the funding stories began to leak out. Meerkat was raising money from Greylock Partners, The Information reported. The valuation would be around $40 million, Business Insider reported. The amount would be $12 million, TechCrunch reported. (The company has not confirmed the amount, but the company did not dispute a New York Times report putting the amount at $14 million.)
In an interview with Fortune during SXSW, Rubin explained that his team built the app quickly, but it was after years of working on other unsuccessful livestreaming apps. Past efforts had nowhere near the level of engagement of Meerkat, so Rubin shifted his entire company’s focus to the new app. That company, formerly known as AIR and Yevvo, had raised just over $4 million in funding from investment firm Aleph, Ooga Labs, Entree Capital, PLUS Ventures and angel investors.
Meerkat went viral because it is simple and highly engaging. But the biggest key to its success has been Twitter (TWTR). Meerkat used Twitter login credentials to create an instant social network for new users. Livestreams are automatically Tweeted, drawing in an immediate audience. Twitter, which had quietly acquired a yet-to-launch livestreaming app called Periscope for a reported $100 million, does not provide access to its social graph to direct competitors, Rubin said. So it cut Meerkat off. Many predicted this would spell death for the young app, but since being cut off, excitement around Meerkat has only grown.
Meerkat has a head start on Periscope, but it will face powerful competition when Twitter’s livestreaming app launches. For now, Meerkat can celebrate raising a big pile of Meercash.
Read Fortune’s prior coverage of Meerkat: