Giphy has raised a $2.4 million Series A round of funding, according to the SEC website and an official blog post announcing the round. betaworks led, with participation from Lerer Ventures, RRE Ventures, and CAA Ventures.
Giphy launched out of betaworks in February of 2013 with about $1 million in seed funding from the indefinable incubator-startup studio hybrid run by John Borthwick. Today, the company closes on $2.4 million of the $2.5 million round, with betaworks providing around half and the other participating investors making up for the rest.
The last $100,000 in equity is being reserved for a crowdfunding campaign through Alphaworks, the new crowdfunding investor platform out of betaworks and led by Nick Chirls. The Alphaworks side-round is not yet open for investment, but will be in the coming weeks.
“We were super oversubscribed for this round,” said CEO Alex Chung. “We were going to originally just stick with betaworks exclusively but we couldn’t pass up the opportunity to work with these other investors, who have so much experience with media and knew what we were trying to do.”
“It was like peanut butter and chocolate, way too good to pass up,” chimed in Director of Strategy Adam Leibsohn.
Giphy is still very much a betaworks studio company, with betaworks owning a majority share in the startup, though the team has grown to 12 employees, all of whom work out of the betaworks office in Lower Manhattan.
And that’s plenty for now, says Chung. Twelve employees will get them to the next level, meaning that the funding will go towards more fun things, like new features and refining the search engine.
Giphy will generate revenue through licensing deals with content distributors, and many are already in place with media properties like the Huffington Post and Buzzfeed. In the future, the company will also provide sponsored search results, so that when a user types in “dragon”, HBO can pay to have the Mother of Dragons and her babes show up first.
The company recently released a ‘link shortener’ that makes it easier to share gifs on social networks, which will likely offer a big boost in terms of distribution. After all, Giphy is one of the only companies (if not the only one) to be approved by Twitter to simultaneously shorten links and post gifs in-line.
[IMG via Giphy]