Mevio Raises $15M for Straight-to-Video Strategy

Mevio, formerly known as Podshow, is today announcing a new, $15 million round, capital that brings total funding for San Mateo, Calif.-based startup to, yipes, $39 million. In just three-and-a-half years. The money came from Crosslink Capital Partners, DAG Ventures, Sherpalo Ventures, and returning investors Kleiner Perkins Caufield & Byers, and Sequoia Capital.

I don’t get it. Mevio, Podshow — it hasn’t clicked since starting life as a heavily hyped podcast startup. Centering on podcasts was a fine idea; somewhere around 20 million people are downloading podcasts today, a number expected to jump to 65 million by 2012, if you believe the consultancy eMarketer. But as we know now, the most popular podcasts are those by bona fide media companies like National Public Radio, and HBO. And most people quickly discern how to skip past the annoying advertisements embedded in their content streams, so unless you’re Steve Jobs and using those free NPR podcasts to lure more folks to iTunes, you’re in trouble (especially if you’ve raised a bunch of venture capital).

Unfortunately, the newly reinvented Mevio — now a video aggregation site — is premised on logic the founders should know is flawed: that if they just marry advertisers with safe, predictable content — like what they get advertising against “30 Rock” or “Lost” — they’ll come. Indeed, Mevio is trying to build up a big library of “semi-pro” videos, then, based on what’s getting the most traction with viewers, its staff is following up with each of the “filmmakers,” and offering to produce a series for them in exchange for an ownership stake in the series. Mevio says it can produce the shows for several thousand dollars a piece. Great, if the idea is to roll up creative rights on the cheap. But how can approaching these amateur video makers one by one possibly scale to suit an ad-driven model? And even if it can, who says we want to watch these shows? (Judge for yourself.)

I talked with Crosslink’s Peter Rip about the company. He was very nice to speak with me, considering that Crosslink’s partner on the deal, Jim Feuille, is in the Far East right now. Among other things, Rip said that creating and aggregating content was already fairly easy for Mevio, adding that its “templatized” process allows it to quickly and effectively “sift for gold” — meaning find what they may want to serialize. I also wondered about cost; after all, hosting and streaming videos is expensive. Rip wouldn’t discuss burn rate but said, “Let’s put it this way: We think it will profitable late this year or next year.”

It’s challenging to see how, or to understand this funding. Online video is an incredibly tough a business, whatever a company’s approach. What do you think?