US start-up and online publisher the Cheezburger Network, which is behind the LOLcats internet meme, has secured $30 million in funding from a group of leading investors.
The Cheezburger Network was founded in 2007 by former journalist Ben Huh, initially relying on a $2 million angel funding round in order to survive.
Described as the world’s largest online publisher, the company has garnered a huge audience through its throwaway comedy sites, such as LOLcats and FAILS.
With a readership of 16.5 million people, users share more than 500,000 pictures and videos a month, and can view 375 million pages and 110 million videos a month.
Huh says the funding, which came from the Foundry Group, Madrona Venture Group and Avalon Ventures, will be used to hire additional employees, and fund marketing and growth initiatives.
According to Avalon Ventures managing director, the Cheezburger Network is an attractive prospect for investors because it remains at the forefront of web culture.
“Cheezburger has an amazing ability to always be at the intersection of internet, society and culture, which is highly attractive not just to consumers but increasingly important as brands look to engage consumers with content and advertising,” Levandov says.
“They’ve cracked the online media nut and the new financing will further accelerate the company’s aggressive growth strategy.”
Foundry Group managing director Bred Feld congratulated Huh and his team for developing “a treasure trove” of websites that consumers love.
“Already challenging the online traffic of traditional media companies, Cheezburger has an opportunity to surpass the industry heavyweights to become the world’s largest humor network,” Feld says.
Mick Liubinskas, co-founder of Australian start-up incubator Pollenizer, says the Cheezburger Network is attractive to investors because it has kept people engaged over a long period of time, and has struck the right balance between engagement and monetisation.
“You have to be really careful with commercialisation otherwise people stop coming [to your site] and you essentially kill the goose that lays the golden egg,” Liubinskas says.
“In addition to advertising on the site, [Cheezburger] offers partnership deals and emails, which are big in terms of monetisation.”
Liubinskas says there are two stages with regard to monetising a site for start-ups:
- The testing stage, whereby a small segment of your customer base is tested before you proceed with any monetisation strategies.
- Expanding the business, in ways that are commercially viable, based on your findings.