Brisbane startup Clipchamp has closed a $13.2 million Series A funding round to meet the growing demands for its online video-editing platform.
The raise was led by US venture capitalist Tola Capital, and includes investments from TEN13 and existing investors.
Launched in 2013, the online video compression and conversion tool secured a $1 million investment from Shark Tank investor Steve Baxter last year to accelerate its video-editing tool Create.
Co-founder and chief executive Alex Dreiling tells SmartCompany the raise came sooner than anticipated, spurred on by an unexpected and “astonishing” growth boom in the last 12 months.
According to Dreiling, the startup’s primary platform Create has seen revenue grow by about 500% in the past 12 months, pushing Clipchamp to triple its staff to keep up.
He expects this growth to continue, because he has been able to “effectively see growth literally everywhere” Clipchamp has been made available, particularly in the US.
On the other hand, the sudden growth also left Clipchamp struggling to scale quickly enough to take up partnership proposals from big-name brands.
“To date, with all partnerships we’ve established, they’ve all been inbound inquiries,” Dreiling says.
“We had to knock back a few really, really big names just because we couldn’t facilitate it.”
The new round of funding is intended to secure more high-profile offers by developing further capabilities, such as allowing other platforms to embed Clipchamp and adding flexibility to the startup’s payment process.
Once the vision for the platform has been achieved, Dreiling plans to build a bigger team with the capacity to initiate partnerships and develop professional relationships.
And now these goals are within reach, the co-founder is reconsidering the offers Clipchamp previously declined because “we obviously want to potentially work with them in the future,” he says.
“You’ve got to get ready to scale-up platforms, I suppose, if you want to close a lot of partnerships,” Dreiling adds.
“It’s about how we interact with the companies and that requires a certain level of maturity.”
The strategy over the past 12 months has been to lock down smaller partnerships that are possible with Clipchamp’s current capabilities, in hopes of scaling the relationships as it grows its product offerings.
One such recent success was with Dropbox. Dreiling credits the partnership to Dropbox’s built-in user authentication capabilities, which automatically creates a Clipchamp account for existing Dropbox users.
By relieving Clipchamp of the account building process, Dreiling says Dropbox is able to upgrade its user offerings so account holders can edit stored videos using Clipchamp’s Create platform.
Dropbox’s “bottom-up approach” has also inspired Clipchamp’s new growth strategy, he says.
This will involve Clipchamp’s business model pivoting to “create large user bases and within those user bases, see more and more people upgrade to the business and enterprise features”.
“We’re on a very similar journey to what Dropbox has taught the market to do,” he adds.