Socialcam and Viddy appeared to be the front-runners for that, but then certain things got in the way
- FB cracked down on both for being aggressive with people's feeds. This killed growth.
- SocialCam got acquired for $60M by Autodesk which as a comparable transaction wasn't very favorable for Viddy (on a price/user valuation multiple basis since there was little to no revenue)
- Investors had control of the board and likely decided based on the above and other factors (such as company founders departing) that this was throwing good money after bad and so decided to take their money back
I'd be interested in knowing, though, what the precise financial transaction looks like. Dividend? I would think that they would try and avoid those tax consequences.
To some extent, this might be a deal for Viddy (aka as good as it gets). If the investors are in control of the company, they could have just closed the shop and returned all the funds.
Granted, the ~50% staff reduction probably sets off some alarm bells, but if it really is a matter of improving efficiency, that's actually really good business for a startup.
Unless I'm missing something... this is either news in both directions at once or neither. Now my head hurts.
1) Viddy is hurting bad in terms of users -- You'll see that JJ has tens of millions of followers but the interactions and view counts on his videos are very, very low in comparison. It makes sense to give it back because their growth is probably very, very, low. If they are around 40-50th in Photo and Video they are definitely doing less than 10k downloads a day.
2) Viddy actually has quite a good app. They have a pretty solid team, and can ship quite quickly.
3) Apple is promoting the shit out of video applications. Even though no one is really using them* -- things like Vyclone, etc. Either they are hoping for one of these to really take off and cause iPhone sales in the same way Instagram did, or are about to introduce new technology which makes video-capturing much better/easier/etc in the same way that Instagram came at the perfect time for the iPhone 4's camera enhancement.
Since Socialcam's sale, Viddy is definitely in the best position in terms of Instagram-like video apps, so if there are new advancements in the iPhone 5+ that do make video more appealing somehow, they will be the go to app. That being said, video is hard, and no one like to watch shitty videos which is why I'm bearish on video apps in general.
*Vine is up there, but it's still an unproven quantity I would argue. Is it's current success tied to it's insane distribution network? Time will tell.
