Streaming Success: Celebrating What Makes HBO Binging Possible
Today one of our portfolio companies, ClearLeap announced it was acquired by IBM. This marks a very successful exit for an innovative company in a highly competitive market. It’s just the latest in a string of successful outcomes Trinity Ventures has had in the video infrastructure market. It’s a market we’ve had a long history with and one that has generated over $1 billion of exit value for us. Not only is ClearLeap’s news a success story, it demonstrates the continued value of video infrastructure in this Internet age.
In the first episode of HBO’s Silicon Valley, one of my favorite shows on TV today, the main character Richard Hendricks innocently develops a revolutionary technology: an algorithm that compresses large data files without compromising quality. While the episode’s humor was partially based on how clueless Hendricks was about his technology’s potential (all he wanted to do was allow people to search music files), I think those of us in the real Silicon Valley found it poignant, that after all these years of technology development, delivering video over the internet is still a challenge.
This challenge especially spoke to me, given my work at Trinity Ventures around video and content distribution technology. As thematic investors, we like to identify emerging technologies, make a series of bets, and then thoughtfully guide our companies through what can often be turbulent waters. This can be the case when you are in the middle of a wave of innovation, like the distribution of video through the Internet.
It may seem silly now to think about streaming video online as some wild, new innovation. The novelty of YouTube adequately prepared audiences for the wonders of watching videos online. The rise of Netflix, Hulu and Amazon Video has now propelled streaming video to a domineering status; it’s become a common way for people to watch short-and long-form content. But when I joined Trinity Ventures in 1999, online video content was just starting to take off. We decided to invest in several companies in the video delivery technology space.
Speedera was a content delivery network we funded in 1999 that would eventually help manage some of the biggest video streams on the internet at that time, including the streaming of the Mars Rover landing in 2003, before being acquired by Akamai in 2005. Speerdera’s work ensured that thousands of people could watch the landing on the NASA website without crashing the site.
Other companies followed. Modulus Video, which we funded in 2002, was the first company to build an High Definition (HD) encoder. The company, which would later be acquired by Motorola, was the first vendor to ship a system to encode video into a high-definition stream and was widely adopted by many video service providers to provide high-definition content, something we take for granted today. We also invested in Ankeena in 2008, which provided software that allowed companies and service providers to create their own content distribution networks. It was later successfully acquired by Juniper Networks.
And now we have ClearLeap. This company took video streaming infrastructure to a whole other level. It provides solutions for a multiscreen platform, ensuring that streaming video isn’t a problem, no matter what type of device you are watching it on, and it delivers the level of video quality that is demanded by premium content owners including customers like HBO, The Food Network, HGTV and CBS Sports.
The company has had an eventful journey, including some great wins and some challenging times. We first funded the company in early 2008, and then helped support the company through the aftermath of the financial market meltdown in subsequent years. ClearLeap was able to successfully grow through that period and afterwards, winning large influential customers one after the other.
The team, led by founder and CEO Braxton Jarratt, is a group of consummate professionals and visionaries in the video market. We thank them for all the hard work, perseverance, and personal sacrifice to make ClearLeap a successful company and are very proud to have been associated with them. And now, we’re happy to say, Clearleap is joining the IBM family to continue carrying forward their mission of delivering the highest-quality video to the multi-screen world.