Israeli video sharing company Metacafe Ltd is trying to improve its position in a near hopeless struggle against YouTube Inc. Metacafe has closed its Israeli development center and fired half its staff. Metacafe currently has 60 employees in Israel and the US.
In a laconic statement, Metacafe said that just over ten employees at its development center received offers to move with their families to the company's new R&D center in San Francisco, which it will expand by 30%.
Metacafe has raised $55 million since it was founded with high hopes in 2004. Investors include Benchmark Capital, Accel Partners, DAG Ventures and Highland Capital Partners. It was founded by Eyal Herzog, Ami Avrahami, Arik Czerniak, and Ofer Adler, none of whom are still at the company, which is now run by an American CEO Erick Hachenburg.
Although Metacafe beat YouTube to the market, YouTube soon overtook it as the preferred video sharing site, leaving Metacafe to struggle on.
Metacafe's decision to consolidate its R&D operations in the US is intended to bring the center closer to the company's sales and marketing operations and strategic partners. The move to the US will be gradual, and will be overseen by the company's managers in Israel.
50 million views visit Metacafe's website daily.
Published by Globes [online], Israel business news - www.globes-online.com - on September 26, 2011
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