Vidyo Gets Another $20M Investment to Explore the Wild West of Video Conferencing

Vidyo, VSee competitor, just raised another $20M to bring their total funding to $139M — well ahead of the typical $40M needed to reach IPO stage.  With 300 employees and a monthly burn rate of probably ~$4M, Vidyo’s $20M fundraising at this stage of the game is rather unconventional – companies positioning for IPO normally raise huge rounds. It’s highly likely that Vidyo’s current revenue can cover its expenses, but it needs extra cash to explore new markets.

An expansion into new markets isn’t too surprising considering that video conference companies valuations have been poor cousins to Instant Messaging companies, e.g. Instagram and WhatsApp.  It’s likely that Facebook’s acquisition of WhatsApp for $19B earlier this year has jolted Vidyo investors, pushing Vidyo to explore new markets.  According to Vidyo CEO Ofer Shapiro, Vidyo has its sight set on more than the enterprise video conferencing space – it’s going after consumer markets, and it wants to go big.

This includes going after the booming healthcare space to bring video chats to hospital beds or patients in their homes as well as to the online banking space. But even beyond that, it means taking video conferencing into the “Internet of Things.” We’re not talking smartphones but everyday technology from wearable devices to gaming consoles to household appliances — with the end goal of putting Vidyo technology directly into the hands of consumers.

Vidyo has already gotten a head start on this with Google+ Hangouts video chat which used a Vidyo plugin until recently.  Even now with Google Hangouts moved onto the VP8 video codec and getting ever closer to a completely WebRTC implementation, the Vidyo and Google partnership continues with deals such as Vidyo’s work to add its scalable video codec (SVC) into VP9 (which will eventually be used by Hangouts and all WebRTC platforms) and the VidyoH2O video conferencing bridge for Google Hangouts.

VSee, on the other hand, has taken the strategy of focusing exclusively on healthcare and developing workflows to make healthcare customers happy. The question is: Will VSee’s strategy will knock Vidyo out of healthcare market.  Is Vidyo spreading itself too thin to make you happy?

In any case, congratulations to Vidyo on the another round of successful fundraising!

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