August 21, 2007 / 3:04 PM / 13 years ago

Metacafe get $30 million third-round funding

NEW YORK, Aug 21 (Reuters) - Metacafe, a video-sharing start-up that pays users to upload clips to its Web site, said on Tuesday it has received $30 million in funding from venture capital firms including Highland Capital Partners and DAG Ventures.

The third-round funding comes after the Palo Alto, California-based company received a total of $15 million from Accel Partners and Benchmark Capital.

Metacafe said the money will help it expand globally, as well as help it increase the range of videos posted by users, who are paid through its Producer Rewards program.

Users who upload videos to Metacafe are paid $100 after the clip has been viewed 20,000 times. Then they are paid $5 for every 1,000 views thereafter.

“We wanted to bring in enough capital to maintain our leadership in this space,” said Erick Hachenburg, chief executive of Metacafe.

Metacafe, which describes itself as the biggest independent video site, has 25 million unique viewers a month and is a distant No. 2 to Google Inc.’s (GOOG.O) market-leading YouTube, according to data from ComScore.

YouTube said in May it would start giving a cut of its ad revenue to some of the most popular amateur video clips on its site.

Hachenburg said his company will not be limiting itself to just amateur clips and, like YouTube, will work with traditional media companies in the future.

“We’re building an advertising-based revenue stream here, and forging relationships with all types of companies on short-form video,” said Hachenburg.

Metacafe also said co-founder and former chief executive Arik Czerniak will be stepping away from day-to-day operations to pursue other entrepreneurial endeavors but will remain on the board and continue to act as an adviser on strategic matters. (Click here to see Reuters MediaFile blog) (Reporting by Yinka Adegoke)

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