PowToon, an animation platform that lets anyone build marketing videos on the fly, is announcing it has raised $600,000 in outside funding. The investment doesn’t come from traditional VC backing, but rather from Startup Minds, a newer L.A.-based accelerator with a non-traditional strategy where investments can range anywhere from $25,000 up to $600,000. The accelerator also doesn’t have time limits, and the amount of outside involvement is up to the company funded.
Startup Minds was founded earlier in 2012 by Dr. David Gonen (co-founder at Ringadoc and Curious Minds incubator) and his family. Dr. Gonen says he happened across PowToon on his own, while hunting for an affordable way to create presentations for his portfolio companies. ”The limited options for creating affordable and nontraditional marketing collateral is mind-blowing,” Gonen says of the current landscape.
For those unfamiliar with the product, PowToon offers a DIY solution for making those nearly ubiquitous marketing videos featuring cartoon characters explaining some sort of idea or solution. You know the kind – the “explainer” videos, as they’re often called, which attempt to use simple, entertaining scripts to establish a core concept. These videos are regularly used in startup demo presentations shown to users and investors alike.
With PowToon’s freemium service, users have access to a collection of templates and other content sourced from designers, animators, voice actors, and sound artists who sell through the PowToon Marketplace. Its DIY platform lets non-professionals drag-and-drop objects onto slides, choose the animation and duration, then add text and a soundtrack. The end result can be uploaded to YouTube or shared on social networks like Facebook and Twitter.
The U.K.-based company was founded in October 2011 by serial entrepreneur Ilya Spitalnik (CEO) who also runs the Greenwave Incubator and COO Daniel Zaturansky. It previously had a small investment from Spitalnik’s Greenwave and Kima Ventures, but had primarily been bootstrapping until today.
Now five months since its beta launch, PowToon has been used to create more than 75,000 presentations on its platform, and has added monthly subscription plans as well as pay-per-use options. It has also expanded its user base beyond startups and marketers, reaching out to the educational sector through a strategic partnership with Discovery Education (a subsidiary of Discovery Communications). The Discovery deal is a partnership with the Discovery Educator Network, where PowToon is offered to thought leaders in the education sector on a subsidized basis.
The additional funding will be used primarily to develop new features and iterations on PowToon’s software. “We took the smallest amount of funding we possibly could to grow the company while maintain a bootstrapping style and corporate philosophy. We only wanted one single investor and we had term sheets on our table for a multiple of the investment amount from different sources – but we finally decided on StartupMinds because they seem to be a great fit for us,” says Spitalnik. The funding will be used to expand the team and improve and increase PowToon’s feature set. Currently, PowToon’s core team is four, and it has just grown to seven total people. The company is now looking to increase that to ten.