Daniel Cohen on Funding Online Video Startups

Focus on Traction and User Value

In sharp contrast to the other VCs in the NewTeeVee Live 2008 Online Video Investment Trends panel, Daniel Cohen (general partner of Gemini Israel Funds) emphasizes the primacy of traction and user acceptance.

The business model of his new early-stage investment in EyeView reflects this philosophy:

Online client businesses engage visitors to interact with short tutorial movies in rich media format, which Eyeview records as a lead that they offer for sale back to the client. eBay is into their fourth implementation of EyeView, the objective being to educate the public about new functionality in the Affiliate program, which has outperformed expectations.

Equally demonstrative of this philosophy is another company in Gemini's portfolio, Adap.tv, which launched a new product this year called OneSource. It helps publishers to market, control, and monetize content with ads served from multiple sources, including their own video ads.

What's good for the user, is very good for the client, which is great for the investor. Lesson learned.

reprinted from WOM-buzz