A version of this post titled “The business of GIFs” originally appeared in the Startup Sunday edition of Data Sheet, Coins2Day ’s daily tech newsletter.
Nearly every time a pitch about a new app for photos, messaging, video, or other content lands in my inbox, I decline the invitation. At this point, pretty much all of them are just rearranged versions of something that already exists.
On Thursday night, a roughly one-year-old startup named Gfycat (pronounced “jiffy-cat”) booked a small beer bar in San Francisco’s SoMa neighborhood and invited friends and investors to celebrate its recent $10 million funding round. Gfycat built a tool that lets users create GIFs, or graphic interchange format images (very short looping videos), that are higher quality and smaller in file size.
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But does the world really need another tool to create and share short videos of kitten making grumpy faces? And more importantly, can Gfycat convince millions of people to regularly spend time on its service—also known as building a community?
Of course, Gfycat says it can and that is has done so—it already has 75 million monthly active users, about half as many as six year-old Pinterest, a online service for collecting images. The startup also says it’s making sure to avoid the mistakes made by Vine, a short-video service Twitter acquired in 2012 and killed off last week after it mostly failed to maintain and improve its features over its brief lifespan.
“We focus a lot on creators because they’re the ones who bring their audiences,” Gfycat co-founder and CEO Richard Rabbat told me.
Gfycat also knows that unless the short looping videos its users make can be shared and found anywhere on the Web, its chances of taking over the planet are slim. That’s why Gfycats can be posted pretty much anywhere, from social networks like Facebook to blogs and news sites, and already half of views come from outside the company’s apps and website.
Still, Gfycat has to compete for people’s attention with social media giants like Facebook and Snapchat, and that’s no easy challenge—just ask Vine.