Social video discovery startup Chill laid off approximately 40 percent of its staff this past Monday. The news was confirmed by co-founder and CEO Brian Norgard, who says the company is getting leaner and focusing on core product. The layoffs hit the company’s entertainment team the hardest, he says, including marketing, business development, and content acquisition.
Chill started out two years ago as an online video discovery portal that used social signals and user viewing preferences to surface the most compelling video content from across the Web at any given time. This could mean anything from a user-generated action sports video, to a professionally quality branded viral video from Dollar Shave Club or CollegeHumor. The company described its mission as becoming the “front door of video.”
Later, the model evolved into a direct to-fan-distribution platform for independent video creators. Looking to parlay off of the momentum from the hit direct-to-fan success stories of Glenn Beck, Louis CK, and Aziz Anzari, Chill built a competing platform, but never really got the traction that it was looking for.
“We discovered that the sales/acquisition cycles around premium content to be somewhat inconsistent with our self-serve distribution model,” Norgard wrote in an email. “Premium content creators still want deep human assistance in creating sales, marketing and multi-window distribution plans. Our product is distribution centric and therein lies some of the challenges we faced in the marketplace.”
Finally, Chill began signing premium content distribution partnerships with publishers like TMZ, Jimmy Kimmel Live, and others. The idea was to sell access to individual pieces of content on an à la carte basis. Judging by today’s news, this didn’t turn out as planned and likely had limited impact on attracting additional audience to its independent content.
Per Norgard, “In an era of YouTube (free content), convincing people to transact around premium titles a la carte still isn’t nearly as straightforward as one would assume. There’s a reason why Netflix is so highly valued on the public markets. Easy access to premium content is still very, very hard to do.”
When chill announced its TMZ partnership and $8 million Series A funding round in June 2012, it reported having 10 million monthly active users among more than 18 million registered users. As of June of this year, the site appears to have been receiving approximately 500,000 monthly unique visitors and 1 million monthly page views according to StatsCrop (although third party traffic stats can be unreliable at times) – a drop in the bucket compared to its year ago numbers.
Like many other social video portals, Chill’s decline can be tied, in part, to dramatic reduction in the amount of traffic referred by Facebook following newsfeed algorithm changes. Once the easy traffic disappeared, the company appeared to struggle in attracting new audience and building a sustainable business at its existing level.
Chill raised a total of $10 million across two rounds of financing from backers including Kleiner Perkins Caufield & Byers, William Morris Endeavor (WME), Atlas Ventures, Lowercase Capital, 500 Startups, Redpoint Ventures, CrunchFund, Science, Troy Carter, and Mike Jones. [Disclosure: CrunchFund is an investor in PandoDaily.] PandoDaily reached out to both Kleiner Perkins and Lowercase, but neither firm returned requests for comment.
LinkedIn still lists 15 employees for Chill, but judging by their titles this still includes the “entertainment team,” suggesting the company is down to a product-focused team of nine people, according to Norgard’s math.
What all of this means for Chill going forward is not clear. According to one source close to the company, there’s still money in the bank, though the source didn’t provide details as to how much. But this source was more certain of one thing: “Chill, as we know it, is done.”
We’re not ready to write the company off entirely, but it appears that a pivot, or at least a business model change is in order. It’s unclear if even the company’s founders know what comes next. But Norgard is nothing if not relentless, and as the former founder of Ad.ly and a GM at Fox interactive, he’s capable of navigating choppy digital media and Hollywood waters.
We’ll continue to report as this story develops.
[Image via FreedomsLighthouse]
- ChillDirect to consumer video distribution platform.
Chill helps you discover the best videos in the world.
By creating a social experience committed solely to premium video, Chill is enriching the fabric that connects us—by seamlessly delivering what we laugh, cry or wonder about through the taste of the people you trust.
Chill is founded by Brian Norgard and Daniel Gould.