Remember Metacafe? That’s right, the video entertainment site which got overshadowed by YouTube’s phenomenal rise? Well, it’s now making a huge gamble on a new product direction and doing so with zero guarantees. The gamble is WikiCafe, a collaborative editing approach for video metadata. To appreciate how important WikiCafe is to Metacafe just take a look at the company’s official R&D resource usage: 60% WikiCafe, 30% revenue generating opportunities, 10% everything else. That says it all.

I spent a few hours with Eyal Hertzog, the company’s co-founder and Chief Creative Officer who walked me through the company’s new product vision and the rationale for its big bet on the wiki approach to organizing videos. Hertzog was frustrated that users (he being among them) couldn’t just locate “THE” result when searching for a video. His definition of “THE” being a single video result that encompasses all the relevant (and preferably accurate) info, along with multiple language versions, captioning, and so on. The current reality, of course, is that when we perform a search for a video we get back multiple results—sometimes even in the hundreds—from multiple sources, in various languages, with different view counts, fake versions . . .. You all know the drill. → Read More

The co-founders of once-hot video startup Metacafe, Arik Czerniak (pictured with his nephew son) and Ofer Adler, have left the company and cashed out their shares for $5 million, according to an article in the Israeli paper The Marker (in Hebrew). Czerniak stepped down as CEO in February, 2007, when he was replaced by former Electronic Arts executive Erick Hachenburg, but stayed on the board. Adler was always an adviser and investor, and remains at IncrediMail, another company he co-founded long ago. Now both have severed ties with the Metacafe. An autoreply from Czerniak’s Metacafe email account says: All, As of 20.3 I’m no longer using this email. [Updated with corrections: Due to a prior error in translation from the Hebrew, we reported earlier that both founders together had a 5 percent stake, but each one actually had a 5 percent stake, or 10 percent total). Both Czerniak’s and Adler’s shares together represented only 5 percent each of the company, and had fully vested. Each reportedly received $2.5 million, but their shares were not priced at the company’s most recent round of funding. Rather, the price was based on an earlier valuation of $50 million. The company has raised more than $45 million so far, with a $30 million round as recently as last August. And back in late 2006 it unsuccessfully tried to shop itself around for $200 to $300 million. The article cites conflicts with Hachenburg and the strategic direction of the company. But maybe they just didn’t think anyone would ever buy it. Metacafe is still one of the top video-sharing sites, with 28 million unique visitors worldwide in March, according to comScore. But it’s growth has been pretty lackluster all year (up 15 percent). Meanwhile, YouTube keeps widening the gap with nearly ten times as many worldwide unique visitors, 288 million, and a faster growth rate (up 78 percent). And in the same period, Veoh‘s worldwide uniques have more than tripled to 17.5 million. These numbers do not include embedded videos for either service, but they give a good indication of the overall popularity of each site. CrunchBase Information MetaCafe Arik Czerniak Information provided by CrunchBase → Read More