by Lorna Li

Grouper’s party at Ondine, Sausalito, gets a bub.blicio.us score of 9. And the reason for their celebration?

Grouper Networks
, a video sharing site with 8 million users, was recently bought by Sony…and guess what? They’re hiring.

In an effort to lure new talent to their company, Grouper hosted a recruiting party at the tres chic Ondine, where guests dropped their names and job interests into a basket and then enjoyed the open bar, delectable seafood spread, artisan cheeses by Cowgirl Creamery, heavenly deserts. Still not convinced?

The evening was topped by the surprise appearance of Burning Man‘s very own, Extra Action Marching Band. Be warned, this is not the marching band your parents wanted you to join in high school.

New recruits, don’t be perturbed by Grouper’s racy edge – after all they do videos, not financial services. But if the culture and creativity don’t convince you, perhaps the money will.

Last August, Grouper was bought by Sony for $65 million – not bad for a site, that, at 8 million users, still does not even make a dent in the online video market. According to Hitwise, YouTube, at 46%, still holds the lion’s share of the online video market, trailed by MySpace Video’s at 21% and Google Video at 10%. Startup competitors such as Revver Inc. of Los Angeles, Grouper Networks Inc. of Sausalito, Calif., and MetaCafe Inc. of Tel Aviv only grab a few percentage points of online video market share.

Yet, in a bub.blicio.us world, the hype surrounding online video has triggered lofty valuations and huge acquisitions, even though these companies still don’t have a clear way of monetizing their sites. But when Sony’s your daddy, monetization is merely an afterthought.

Why Sony would find an unknown video sharing startup with a mere 8 million users a compelling buy (to the tune of $65 million) has been the cause of much debate and speculation. While Grouper says it’ll work with Sony to promote the company’s movies and TV shows on the site, perhaps Grouper’s existing peer-to-peer network could be an appealing way to distribute high-quality downloadable movies?

According to PaidContent.com, the purchase was prompted not by the traffic, but by the technology. “It’s about Sony realizing they don’t have to invent everything, and trying to prove they can bring in good people and let them do something solid. Secondly, this probably signifies the start of a shakeup in the video sharing space, where other also-rans are struggling to find their footing against the YouTube juggernaut.”

Jonathan Shambrook, vice president for marketing at Grouper, attributes their rapid social networking success to the company’s ability to firstly, identify their audience and secondly, deliver what their audience wants. In this case, the company determined that their users really wanted portability, and set out to provide it.

The company made sure that every video uploaded to Grouper could be downloaded to a Sony PlayStation Portable and an Apple iPod. Even better, users can import video clips straight from their cameras, edit them together, and share them from a single interface. Also, with Grouper’s (partial) peer-to-peer model, much of the shared data is stored on the user’s PC, not on distant servers. Finally, users can share an unlimited number of videos—of unlimited sizes— publish them to MySpace, Friendster, Blogger, and WordPress with one mouse click. And all, for free.

Why on earth did Grouper choose the Extra Action Marching Band, an obscure act known by few outside the Burning Man community, as entertainment for the evening? It goes back to the company’s Burning Man roots. According to Josh Felser, Grouper was conceived at Burning Man, because he was frustrated that he couldn’t easily share the videos, photos and music that he captured on the playa.

I can understand his frustration. Burning Man, the annual counterculture arts extravaganza held in the Nevada desert can be described as a phantasmic lucid dream or waking hallucination, where photographers, videographers, and other artists struggle to capture its totality through media.

A hotbed for creativity, Burning Man attracts a huge SF Bay following and draws neo-hippies, robot hobbyists, and pyrotechnicians, as well as startup entrepreneurs and tech billionaires, such as Sergey Brin and Larry Page, the founders of Google.

Grouper founders Josh Felser and Dave Samuel are veteran Burners and tech entrepreneurs. They made their fortune selling their previous venture, San Francisco Internet music startup Spinner.com, to America Online for $320 million in 1999. Spinner.com became one of the components for what is now AOL Music.

Grouper sold 3 years after its birth at Burning Man 2003, in fact, 2 days before Burning man 2006 – just enough time for the founders to close the deal and make it to the playa.

If you are still not convinced, perhaps the sincerity and creativity of the leadership will inspire you to work for this ultra groovy company. The founders Dave Samuel and Josh Felser shared a soul-baring moment of bad-startup poetry, chronicling the history of Grouper’s success and growth:

.

Grouper founders Josh Felser and Dave Samuel recite bad startup poetry

A long time ago, in the land of dust and fire
An idea was hatched that made me feel higher

Aviv, Mike, Dave and Josh birthed a baby grouper
And while it was super duper…

Private file sharing was our G Spot
Yet who knew porn and piracy would be so hot

Alas we learned that privacy does not pay
So we went fishing again and it was the dawn of a new day

While we waited for 2.0 that promised public video
We freaked out, took pills and watched the rodeo…

2.0 on a new ISP launched in time for the holidays
Follows by web uploads and one click posting just before May

The people cheered and roared at this incredible feat
Taking Grouper from 100k to 2mm in just a few weeks

Though vidiot competitors appeared left and right
Groupies continued to find Grouper and add to its might

8 mm users just can’t be wrong
And one day a big fish came along

Sony appeared with movies PSPs and cash
Three cheers for SPE who is funding this bash

Thank you all for an incredible beginning, middle and ending
For it is on your innovative hard work that I am always depending.

For more info, read:

Sony buys Grouper for $65m

Social Networking: The Science

Sony snags Grouper video sharing site for $65 mil

And the Award for Online Video Sharing Goes to… – Grouper 2.0 (beta): Full Review – Review by PC Magazine

More Grouper party pictures:

Photos courtesy of Brian Caldwell. To see more photos of the Grouper party, visit the Grouper Party by the Bay set on Brian Caldwell’s Flickr page.

About the Author:

Lorna Li

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    no imagegatWrarne (Who am I?)16 December 2007 11:11 pm

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