Hollywood management agency The Collective has acquired Metacafe, which once sought to compete against YouTube. The Collective reportedly plans to use Metacafe's video platform for its ad sales infrastructure. The companies did not disclose the terms of the deal and the acquisition comes nine months after Metacafe closed its Israeli R&D center and fired its ten employees.
Metacafe was considered a promising Israeli start-up during the 2000s, as it tried to compete against YouTube, which was acquired by Google Inc. (Nasdaq: GOOG) in 2006 for $1.65 billion. But Metacafe was unable to keep up and fell behind YouTube, further losing its lead to other video sites, such as hulu in the US. Although Metacafe was able to maintain its popularity in India, Malaysia, and other countries, this was not enough for its owners to want to keep it.
Metacafe raised $55 million from Accel Partners, Benchmark Capital, and DAG Ventures since it was founded in 2004 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.
Published by Globes [online], Israel business news - www.globes-online.com - on June 17, 2012
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