Ooyala Hits Profitability In A Crowded Market, Looking For A New CEO

Silicon Valley based Ooyala, a service that manages video streaming for websites, hit an important milestone last month – positive cash flow. The company was founded by ex Googlers Bismarck Lepe, Sean Knapp and Belsasar Lepe in 2007 and has raised just $10 million in funding.

And now they’re considering the hire of a new CEO, we’ve confirmed. Bismarck Lepe, the current CEO, says he’s actually been looking for his replacement for the last year. This isn’t being driven by the venture investor, Sierra Ventures, he says. And in fact the founding team retains stock and board of directors voting control, making their consent a requirement of any CEO change. Lepe just feels as though he isn’t necessarily the guy to take the company to the next level, whatever that may be. So he’s retained a search firm to find someone better than him to run Ooyala.

The company is certainly doing well. We first covered them in late 2008 and they already had big name customers like National Geographic, TV Guide, AOL, and Warner Brothers. Today, Lepe says, they stream 250,000 – 350,000 hours of video a day through partners. One Michael Jackson video last week racked up 70 million views in just 36 hours.

The company has a software as a service model that charges users to set up accounts and manage video. There is an additional fee based on hours of content streamed as well.

This is a crowded space. Brightcove has raised nearly $100 million in capital, for example. Yahoo paid $160 million to acquire competitor Maven Networks and then killed the business line 17 months later. And most recently Joost announced a strategic shift to focus on this space as well.