We will soon bring long-format content including full-length movies on Vuclip: Nickhil Jakatdar

Vuclip is the world's largest independent mobile video and media firm with a presence in Southeast Asia and the Middle East. The company, which is backed by SingTel Innov8, New Enterprise Associates (NEA) and Jafco Ventures, is further growing its global reach by launching in multiple geographies in Asia, Europe and the Middle East. Launched in 2008, the firm also counts India as a key market where it is experiencing good traction in terms of the number of customers, partnerships and revenues. In an interaction with Techcircle.in, Vuclip's co-founder and CEO Nickhil Jakatdar talks about the company, growth, expansion and new fundraising plans.

In November 2012, you raised $13 million in Series D funding, taking the total funding to close to $40 million. Why do you need this much money?

We started Vuclip around six years ago, and raised $40 million in multiple rounds over these years. There are mainly three things that required capital – to pay salaries, to support technology and to partner with content providers and mobile operators.

We scaled our team to more than 170 from just six when we started. So, a large portion of the funding goes towards paying salaries. A part of the funding went towards building infrastructure to support our operations in almost 12,000 locations across the globe. Thirdly, a video play is data-heavy and so we needed to partner with multiple content providers. This also required capital.

You recently launched a buffer-free video streaming feature. Can you explain the underlying technology of this product?

In the normal scenario, a video viewing on mobiles gives an unpleasant experience to consumers. The video works very beautifully for few seconds, and the next moment it stops and starts buffering. On some other occasions, the consumer gets an error message saying this device does not support this particular file. The reason for this problem is that some of the videos that one wants to watch might not have been formatted correctly for that particular device. The changes in bandwidth also affect the viewing experience.

What we did differently is that we have developed an Android app. When a consumer clicks 'play' video on the app, our server can identify the device he/she is using and also the bandwidth. The server then passes all information to the app, and based on this communication it starts sending high-resolution video, say, for the first five seconds, if the bandwidth is fast. And then, when the network drops down for the next five seconds, the server picks this message from the app and sends a slightly lower quality video for the next few seconds, without any interruption on the video play. This process is repeated to make sure the consumer gets a buffer-free video viewing experience.

When you raised funding last time, you had said that you would expand to multiple geographies. Have you started expansion already?

In fact, when we raised funding we were primarily focusing on India. Since then we have expanded to and opened offices in Indonesia, Malaysia, Thailand, UAE and Saudi Arabia. We are now eyeing other regions such as Singapore, Philippines and Vietnam, where we are experiencing good traction in terms of downloads of our Vuclip app. These are also fast-growing smartphone markets.

India has been one of your key markets. Where does the country stand in terms of revenues?

India has been a revenue driver for us in the early days. While that continued, lots of revenues have started coming from other geographies. Today, India contributes about half of the overall revenues, and it is growing on an absolute basis. But on the percentage-wise, other markets are picking very rapidly. Now, our key revenue drivers are Indonesia, Malaysia, Thailand, Philippines, Vietnam, UAE, Saudi Arabia, Turkey and Egypt.

But aren't these relatively small markets? Also, are you also planning to launch the Vuclip app on other platforms?

Indonesia is a huge market like India. Also Thailand and Philippines are not that small, where Android-based smartphones are growing fast. The Middle East is small, but the use of high-end smartphone is huge over there.

Besides our freemium Android app, we are also offering Java-based apps. We will be launching the IOS version in the second half of this calendar year. The Windows version is also in the pipeline, but the launch of the same will depend on how it pans out.

How many mobile carriers and content providers have you partnered with so far?

We have partnered with 120 content providers in India and this number is even higher in other parts of the world. We also have tied up with close to 20 big mobile operators in the world, including Bharti Airtel, Idea and Vodafone in India, and similar carriers in other geographies.

Vuclip is incorporated in the US but you don't have a large presence over there. Why?

The US is not a market that we are focusing. We are based in the US because some of the best talents are still available only in the Valley. If you want to be a leading provider of video search and analytics, you need to rope in people having expertise in these areas.

What is the total number of downloads for your Android app?

We launched the Android version about four months ago. Till then, it had been browser-based and Java apps. We have today more than 1.5 million downloads for the Android version alone. Also, we have about 120 million monthly active users for the browser version.

What are your revenue models? How much revenue did you clock in the last fiscal? What is your target for the current fiscal?

Primarily, we have two revenue models "the consumer pays us for content and advertisement. Advertisers can customise the ads for specific audience in a specific geography.

We don't talk about our revenues publicly. What I can say is that we are approaching profitability as a company. By the end of this year, we will be profitable.

What are the new features you plan to bring in to the platform?

One of the features that we are currently working on is how we can provide long-form content to the consumers. As of now, we provide four- or five-minute videos. We will now enable consumers to watch a full-length movie on Vuclip. Users can watch movies, soap operas and other long-format content on Vuclip. This will be launched in a couple of months.

A couple of years ago, you snapped Jigsee. Is the integration complete? Are you now looking to acquire new companies?

Jigsee is completely integrated to our company. Indeed, our Android app is a combination of Vuclip' and Jigsee's technologies. We are always looking to buy companies. If we find something that meets our strategic goal and also meets our culture, we will buy it.

Is the funding already exhausted? When will you raise a fresh round of funding?

We have still capital in reserve which is more than sufficient to fund our expansions to new geographies. I don't think we need another round of funding unless we want to grow super fast.

(Edited by Joby Puthuparampil Johnson)