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Another day, another mega-round.
This time it’s a company that’s been around for two years without having launched a product to the public. Yep, it’s Quibi, the short-form, mobile-only video platform that finally plans to launch this April.
Quibi, which is short for “quick bites,” just announced an additional $400 million in funding for their venture, which is on top of the $1 billion they raised in 2018 from a star-studded roster of investors. They include Disney, Alibaba, NBCUniversal, 21st Century Fox, Lionsgate, Metro Goldwyn Mayer, Sony Pictures Entertainment, Viacom, and Warner Media.
So yeah, that’s basically like all of Hollywood.
Who’s behind Quibi? Media mogul Jeffrey Katzenberg and former eBay and HP CEO Meg Whitman. The pitch: “TV, but on your phone,” based on the idea that most of us spend hours and hours on our phones. So rather than full-length TV shows, the company will release its videos in “bite-sized formats of 10 minutes or less.” The service will have two pricing tiers — $4.99 per month with ads and $7.99 per month without ads.
Mobile streaming is hardly a new concept. People have been consuming short-form videos on Facebook, Instagram, YouTube, and Snapchat for a pretty long time. Not to mention that Quibi will be competing with Netflix, Apple TV Plus, Disney+, HBO Max, and NBCUniversal’s Peacock.
When Fortune’s Andrew Nusca asked Katzenberg last year how Quibi plans to fit into the saturated streaming economy, he explained passionately how Quibi’s different and doesn’t have competitors. (As a tech reporter, you hear this pretty much every day.)
“I don’t want to get defensive, but… you’re comparing apples to submarines,” Katzenberg said at Fortune’s 2019 Brainstorm Tech conference in Aspen, Colo. “You can’t get what we’re doing on a television set.”
I fall right in Quibi’s target demographic, which is users who are 25 to 35 years old, and I don’t watch TV. I primarily watch Netflix or random videos on my phone. But here’s the biggest problem that contributes to some of my personal skepticism: I use Facebook and Instagram regularly. Do I watch short-form video content on Facebook Watch, Instagram TV, or Snap Originals? Never. And that content is free.
Let’s look at some of the innovations that Quibi has in store. First, it’ll break up movies into several-minute chapters. This means a two-hour movie could take 12 chapters to play in its entirety.
Or, you know, I could just press pause on my regular two-hour movie and return to it later.
Secondly, Quibi revealed its “Turnstyle” feature, which will allow users to rotate their smartphone or tablet to watch content in both portrait and landscape modes to see a different perspective. Katzenberg says it “is unlike anything creators have had before.”
Realistically speaking, how many times do you rotate your phone while watching a video?
I’m willing to be wrong on this one, but I just can’t quite identify the problem that Quibi is trying to solve. Katzenberg is confident that there’s a need for well-produced, high-quality video content for your phone. “We’ll actually create the next chapter of film narrative,” he said in a 2019 Fortune feature. “Five or 10 years from now, we’ll look back and go, ‘There was the era of movies, there was the era of television, and there’s the era of Quibi.’ ”
But as the story noted, if Quibi can’t sign up customers who are willing to pay for a subscription, its clever approaches to content creation won’t really matter.
The strongest case I’ve heard for Quibi has been: “You don’t want to bet against Katzenberg.” Undeniably, he’s a legend who has been in Hollywood for more than 40 years and has more connections than I could imagine.
“Sorry. I’ve been doing this — I get to say this — I’ve been doing this before you all were fucking born,” Katzenberg said at CES yesterday.
For all this money and all this talk, I hope the future Quibi’s envisioning becomes reality.
Polina Marinova
Twitter: @polina_marinova
Email: polina.marinova@fortune.com
VENTURE DEALS
- Roofstock, an Oakland, Calif.-based online marketplace for investing in the single-family rental home sector, raised $50 million in Series D funding. SVB Capital led the round, and was joined by investors including Citi Ventures, Fort Ross Ventures, 7 Global Capital, Khosla Ventures, Bain Capital Ventures, Lightspeed Venture Partners and Canvas Ventures.
- Komodo Health, a healthcare data platform, raised $50 million in Series C funding. Andreessen Horowitz led the round, and was joined by investors including Oak HC/FT also and previous investors IA Ventures and Felicis Ventures. Read more at Fortune.
- Partnerize, a U.K.-based SaaS partner automation platform, raised $50 million in funding. Accel-KKR led the round.
- Vecna Robotics, a Cambridge, Mass.-based workflow orchestration and self-driving forklift provider, raised $50 million in Series B funding. Blackhorn Ventures led the round, and was joined by investors including Highland Capital, Fontinalis Partners, Drive Capital and Tectonic Ventures.
- Advantia Health, an Arlington, Va.-based provider of women’s healthcare, raised $45 million in funding from BlueMountain Capital Management.
- Kyruus, a Boston-based provider of search and scheduling solutions for health systems, raised $42 million in Series D funding. Venrock and Highland Capital Partners co-led the round, and was joined by investors including Providence Ventures and Salesforce Ventures.
- Soul Machines, a New Zealand-based developer of emotionally responsive avatars, raised $40 million in Series B funding. Temasek led the round, and was joined by investors including Lakestar, Salesforce Ventures, Horizons Ventures, and University of Auckland Inventors Fund.
- Corvus, a Boston-based provider of commercial insurance products, raised $32 million in Series B funding. Obvious Ventures and Telstra Ventures co-led the round.
- Outlier.org, a Brooklyn-based online education platform whose courses earn students transferable college credit, raised $11.7 million in Series A funding. GSV Ventures led the round, and was joined by investors including Harrison Metal, Tectonic Capital, and Jackson Square Ventures.
- Docket, an Indianapolis-based software-as-a-service platform for managing intelligent meetings, raised $1.5 million in seed funding. Allos Ventures led the round, and was joined by investors including High Alpha Capital, Elevate Ventures and Simon Equity Partners.
- Sea Star Beachwear, a New York-based creator of the water-friendly espadrille, raised $1.25 million in seed funding.
HEALTH & LIFE SCIENCES DEALS
- BioSkryb, a Durham, N.C.-based developer of genomic amplification technologies, raised $11.5 million in funding. Anzu Partners led the round, and was joined by investors including Wilson Sonsini Goodrich & Rosati.
PRIVATE EQUITY DEALS
- Insight Partners agreed to acquire Veeam Software, an Alpharetta, Ga.-based developer of backup and disaster recovery solutions, in a deal valued at approximately $5 billion.
- Imperial Dade acquired American Paper & Plastics, a City of Industry, Calif.-based supplier of food packaging products. Financial terms weren't disclosed.
- Freeman Spogli & Co. acquired Easy Ice, a Marquette, Mich.-based provider of commercial ice machine rental and related services. Financial terms weren't disclosed.
- Marlin Equity Partners acquired Yaro, a Chicago-based provider of benefits navigation and care guidance solutions. Yaro will be merged with Virgin Pulse, a Marlin portfolio company. Financial terms weren't disclosed.
- Copley Equity Partners made an investment in Gregory FCA, an Ardmore, Penn.-based public relations firm. Financial terms weren't disclosed.
- Galen Partners acquired Evolve Treatment Centers, a Los Angeles-based adolescent behavioral health services provider. Financial terms weren't disclosed.
OTHERS
- Bullhorn acquired Herefish, a St. Louis, Mo.-based provider of automation solutions for staffing firms. Financial terms weren't disclosed.
IPOs
- GFL Environmental Holdings, an Ontario, Canada-based waste management firm, updated its filing after cancelling its IPO. It previously said it would raise up to $2.4 billion in an IPO of 87.6 million shares priced at a range of $20 to $24 apiece. The firm posted $2.7 billion in revenue (pro forma) in 2018 and loss of $532 million (pro forma). BC Partners, Ontario Teachers, and GIC back the firm. It plans to list on the NYSE and TSX as “GFL.” Read more.
- Calisen Group, a British smart meters maker, is planning a London IPO that could value it at between 1.3-1.5 billion pounds ($1.69-1.95 billion), Reuters reports citing sources. KKR backs the firm. Read more.
- Phoenix Tree Holdings, a Beijing-based online marketplace for residential rentals, plans to raise $164 million (with 70% estimated bought by existing shareholders) in an offering of 10.6 million ADSs priced between $14.50 to $16.50 apiece. The firm posted revenue of $374.3 million and loss of $191.6 million in 2018. Tiger Global (20% pre-offering), Joy Capital (15.7%), CMC Capital Partners (9.4%), and Ant Financial (7.8%) back the firm. It plans to list on the NYSE as “DNK.” “Read more.”
- PPD Inc., a Wilmington, N.C.-based drug development and laboratory management service for biopharmaceuticals, filed for an $100 million IPO. It previously filed confidentially in November. The firm posted revenue of $3.8 billion and income of $96.3 million in 2018. Hellman & Friedman Capital Partners (56.7% pre-offering), Carlyle (23.8%), the Abu Dhabi Investment Authority (9.2%), and the Government of Singapore (9.2%) back the firm. It plans to list on the NYSE as “PPD.” “Read more.”
EXITS
- Graycliff Partners LP sold 901D Holdings, an Airmont, N.Y.-based service engineering and manufacturing company, to Curtiss-Wright Corporation (NYSE: CW) for $132 million.
- Effectual, which is backed by Catalyst Investors and Lumerity Capital, acquired JHC Technology, a public sector managed services company. Financial terms weren't disclosed.
PEOPLE
- ABS Capital Partners promoted Kim Kile to general partner.
- Stephane Etroy joined Ares Management Corporation (NYSE: ARES) as a partner and head of European private equity.
- Guidepost Growth Equity promoted Chris Cavanagh and Eugene Nogi to general partner.
- Brewer Lane Ventures named Martha Notaras as managing partner.
- Periscope Equity promoted Alex Friedman to principal.
- Anacapa Partners named Vincent Vo as a principal.
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