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Oct 25, 2017

Thinking About Thinking: Why Volition Capital Invested In Connatix

Thinking About Thinking: Why Volition Capital Invested In Connatix

Posted in Founder-Owned BusinessesGrowth EquityTechnologyVolition Capital by larrycheng on October 24, 2017

We are thrilled to announce our newest $15 million investment in Connatix, and I am very honored to join Connatix’s Board of Directors.  Connatix is performing exceptionally well, and we couldn’t be more excited to partner with them going forward.

So, what does Connatix do?

Quite simply, Connatix enables publishers to generate substantially more revenue from digital video through their industry-leading native video syndication and monetization platform (more on what that means in a bit).

Why does this matter?

It starts with the consumer.  You and I are changing how we consume digital content.  We are consuming more video every year.  Our desire for video content is accelerating and has been for years.  We are also consuming that video content predominantly on mobile.  In short, we want that video seamlessly, in any and every form factor, rendered perfectly, when we want it.  And, we only want quality, unobtrusive content.   Our tolerance for any content that looks untrusted is gone.  Simple enough, right?

Well, this creates a host of problems for digital publishers who now have to engage consumers with video content to stay relevant.  Problem #1: not all publishers have video content and nearly all publishers don’t have enough video content.  It’s hard to give consumers something you don’t have.  Problem #2:  video, especially on mobile, is technically difficult to deliver well.  Provisioning, editing, and delivering video content for a myriad of different platforms, file formats, and bandwidth levels is exceptionally hard.  Problem #3: many publishers don’t know how to efficiently monetize video.  Even if you have video, and even if you can deliver it, if you don’t monetize it well, you’re leaving money on the table.  Problem #4:  any video content on your site has to be consistent with the look and feel of your site (e.g. “native”) or it will degrade the consumer experience and you will lose engagement, not gain it.

So, how does Connatix solve those problems for publishers?

If a publisher doesn’t have video content – Connatix has a market-leading syndication network where a publisher can selectively publish the highest quality video content from other publishers onto their site.  If a publisher doesn’t know how to monetize video well – Connatix has a world-class monetization engine driving consistently superior video economics for their customers.  If a publisher doesn’t have video infrastructure technology – Connatix provides a full-stack solution that can be implemented easily and renders all content natively.  If a publisher has none of the above – no problem, Connatix’s end-to-end solution can take a publisher with literally no video content, no video monetization, and no video infrastructure and have them up and running in a day generating video revenue.  And, even if a publisher already has all of the above, they can still work with Connatix to syndicate their content out to other publishers in Connatix’s network (ranked #2 in scale by Comscore) to generate even more revenue from their existing video assets.  As customers like Time, Mashable, AOL, Tribune, CBS and many others have discovered, Connatix’s platform helps all publishers generate more revenue from the insatiable consumer demand for video content.

Why is Connatix such a great fit for Volition?

In all respects, Connatix represents exactly the type of company that we at Volition love.  The company is led by a pair of brilliant founders, David Kashak and Oren Stern, who have the ambition to build a game-changing company.  Connatix has a crystal clear value proposition for their publisher customers: more revenue.  They have a best-in-class product that can be implemented in hours making it a no brainer for publishers.  And as a result, the company has experienced significant triple digit top line growth while also having been bootstrapped and profitable since inception.  When I first met David and Oren and heard them share the Connatix story, my first thought was – this is a Volition company.  We are very excited that today that original thought is now a reality.  To all of our friends at Connatix, welcome to the Volition family.

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