Boxee is a tech startup with zero revenue and few plans for where revenue will come from. But that hasn’t stopped it drawing another $6 million in funding just a matter of months after securing $4 million. Do these investors know something we don’t?
Designed to work with both PC and Mac, the free software enables Web video to be viewed on a large television, thus blurring the line between computers and the living room.
Boxee is currently in alpha mode and has a small but very loyal user base of around 600,000. It also only has 11 people working at the company, although to grow and truly make a splash against the might of cable companies that will need to grow.
Boxee today announced it has secured $6 million in fresh funding from Boston-based General Catalyst. Prior investors Spark Capital and Union Square Ventures are also participating in this new round of funding.
Boxee claims to need more than just money right now, with General Catalyst also becoming a valuable partner in seeking new content, and building and strengthening the relationships between Boxee and the cable and media companies necessary for the product to do well.
The money is to be used for:
Improving the product – currently in alpha, Boxee is keen to release a beta version by the end of this year. user feedback is essential in this process.
Adding more content – Boxee believes it makes a good partner for content producers and so is seeking to build new partnerships with them. This should ensure new content including Web shows, TV shows, and movie comes to Boxee in the future.
Attracting more developers – Boxee wants to improve its App Store both for developers and users, as well as to extend its APIs to improve Boxee.
I wonder if Hulu can be attracted back on to the service?
Boxee Living Room
The last use for the new funding is by far the most interesting. Boxee currently caters for a very tech-savvy audience who know how to hook their computer up to a television. But to truly become an essential piece of software, Boxee is going to have to add more mainstream appeal.
That means getting into bed with manufacturers of consumer electronics such as television, set-top boxes, and games consoles to ensure a bigger user base can access the service. Boxee claims to already be working on this effort with a view to being available on a variety of platforms by 2010.
So, Boxee has lots of money in the bank and big plans for how to use it. But all of this still doesn’t explain where revenue is going to come from. Maybe Boxee will one day become a paid-for product but its open source nature makes that unlikely. Surely these investors haven’t just ploughed money into a company with no plans for how it’s going to return the favor.
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