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Streaming device maker Roku raises $60M

The company is partnering with two dozen OEMs to launch a line of "Roku Ready" devices

Financial trends and news by Faith Merino
May 29, 2013 | Comments
Short URL: http://vator.tv/n/2fbc

Edited to correct sales figures as they compare to Apple TV.

As a non-gamer in a house of non-gamers (at one-and-a-half, my son doesn’t have the hand-eye coordination for video games yet), I don’t own a Wii or an Xbox, or any of the other multipurpose devices that can stream Web content to your TV. Instead, I own a Roku device—an adorable little box that sits on top of my modem. It’s easy enough to use that my tech-averse husband has figured it out, although he still calls it the “rookoo box.” He’s so cute.

Now it looks like there might be some big changes on the horizon for Roku. The company announced Wednesday that it has raised $60 million in a Series F round of funding led by an unnamed institutional investor, with participation from Hearst Corporation and existing investors British Sky Broadcasting and News Corporation.

The new investment will help spur along Roku’s acceleration plans, which include partnerships with two dozen OEMs who are making more than 3.5 million Roku Ready devices—devices that will be able to access the Roku streaming platform through the Roku Streaming Stick, a small USB-sized device that plugs into the MHL port on your “Roku Ready” TV. The Streaming Stick doesn’t have any separate power or video cables, and it has built-in Wi-fi, so it’s ready to go once it’s plugged in and it works with your regular TV remote. And it comes with a motion control gaming remote.

“Roku has a significant portfolio of investment and strategic partners with very successful global businesses. Their recognition of our brand success and belief in the Roku platform is a tremendous endorsement of our potential to shape the future television experience,” said Roku Founder and Chief Executive Officer Anthony Wood in a statement. “BSkyB and News Corporation are exceptional partners and we look forward to deepening our relationship with Hearst in the months to come.”

The company has sold more than five million Roku streaming players in the U.S. since the company launched in 2008. By comparison, Apple CEO Tim Cook took the stage at D11 Wednesday morning and revealed that Apple TV sales have exceeded 13 million to date, almost half of which have sold in the last year alone. But Apple's figures include worldwide sales. A Roku spokesperson says that Apple's U.S. sales are comparable to Roku's, and together the two make up 90% of the U.S. streaming player market.

The company says it has three main businesses: 1) making and selling streaming players, 2) working with OEMs who are looking for a streaming solution for their devices, and 3) working with content providers to bring entertainment to the Roku platform and to maximize the visibility of that entertainment to Roku customers. The new capital will accelerate growth in streaming software and services.

“Roku has built a strong brand that is widely recognized for great technology and a broad selection of high‐quality content,” said Ken Bronfin of Hearst Ventures, in a statement. “We are truly impressed that Roku has built such a unique position in the market and we look forward to working with them to develop innovative products and services for our television audiences.” 

 

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