VHX Raises Series A Round for its Direct Video Distribution Service

/ Aug 29, 2013


VHX, a service that allows creators to market and sell their video content directly to users, has raised $3.2 million in a Series A round led by Union Square Ventures. Hollywood agency William Morris Endeavor and existing investors Lerer Ventures and Reddit co-founder Alexis Ohanian also contributed to the round, which will be used by VHX to grow its Brooklyn-based team as well as invest in its publishing platform and build apps for multiple devices.

VHX is most famous for being the platform through which funny-man and “Parks & Recreation” star Aziz Ansari sold a new comedy special last year. The startup says it has also worked with companies like Drafthouse Films, Sundance Institute, the Kickstarter Film Festival, and Vice Media to distribute various types of video content. In the past year, the startup has generated more than $2 million in sales for over 300,000 users. The company plans to soon roll out a self-service option that will allow anyone to upload, market, and sell their video content directly to users.

In a blog post, Union Square Ventures partner Andy Weissman likens VHX to Tumblr, praising the service’s easy-to-use interface and design. “Creators are in control of every element,” he says, “a creator needs only to pick a theme, customize the site, and upload content. No exclusivity, and no fees (just simple revenue share).” While Weissman does not disclose what that rev-share is, the aforementioned All Things D report indicates that creators will get a better cut than the standard 70-30 split.

Weissman goes on to throw out ways for creators to use VHX to monetize their content. In some cases, filmmakers can bundle and sell their films in packages, he says. He also hints that creators will have access to “tools and data” which could help them team with other creators to co-market content “on the fly” to their joint fan-bases.

By design, VHX makes a lot of sense for YouTube creators, especially since many are looking for additional revenue streams beyond advertising. The service will go up against several new-ish competitors, though, with platforms such as Subbable, TubeStart, and Vimeo On Demand all launching in the past few months to provide filmmakers and online creators with additional revenue streams.

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