Making money in the online video space: BizVision charts growth

Jim O'Neil

Rob Chipman launched BizVision -- which provides on-demand online videos on everything from career training to project management and continuing education for the legal industry -- last year with one major worry: "I really wished that we had more money to start out with," he said. "We looked around for funding and managed to get some, but not nearly as much as I was hoping for. We've been a bootstrap organization, and largely self-funding almost from the get go. That's been our biggest hurdle."

But the Salt Lake City-based company has managed to survive its first year, is growing, and is looking at being cash flow positive in 2010.

Chipman -- who was founder and CEO of TrainSeek, Inc., an online marketplace for training products and services -- initially pitched the idea for BizVision to the board of Broadcast International, where he was VP of sales and marketing. The company agreed to fund the acquisition of a library of business training videos and carried it in-house. Last year, Broadcast International decided to spin it off, while maintaining an equity stake, with Chipman as its president and CEO.

BizVision's core business -- which had sales of $1.5 million last year -- is based on providing on-demand business training videos to customers for an average of $5 per segment, significantly less that the $700-$900 a DVD of the training material might cost. "A DVD producer has to assume that hundreds of people are going to be able to watch each hard copy," he said. "The seriously limits that business model. We brought them online so an individual can access them when they need them. It's just like downloading a Netflix movie online."

BizVision has aggregated a broad library of business training content that they believe addresses the needs of a large swath of the business community. "We currently have 90-plus topic categories and main categories and we're adding new content all the time."

The company has reached what it sees as a critical mass of general training content and has branched into a more vertical-style of content, offering multi-hour online video professional training courses for accountants and in December launched continuing education videos for the legal profession. "We provide an inexpensive and convenient option for business who don't have in-house training staffs and who can't afford the time or the money to send people to seminars, or to hire consultants to lead training programs on site,"Chipman said.

Videos currently are streamed with a one-time license, but BizVision is exploring the demand for other options.

When the company launched, BizVision used an in-house platform it had developed, and used SimpleCDN initially. Chipman said it recently moved to Level 3's CDN package, but is maintaining its own platform. "We did so much work on it that it just didn't make a lot of sense for us to try and move to another platform," he said.

The company has been pretty low profile; you won't see a lot of news about it if you do a Google search. It has no direct sales force (it has just five employees) and has relied on direct marketing and word-of-mouth referrals for a large part of its business.

"We're also being introduced through various state organizations and societies in the accounting and legal industries," he said, and that could lead to additional general business.

Chipman said part of BizVision's success has been the result of the mainstream acceptance of online video brought about by the success of sites like YouTube and Hulu. He says BizVision has taken those models in a different direction: "To this point, we've proven that people will get out their credit cards and access at least the content we're providing."

The company had a mildly rollercoaster year as it chased profitability, and closed out the year nearly cash flow positive. Chipman said he expects revenues to more than double in 2010 from the business it currently has, and is predicting the company will have a positive cash flow for the year. "We're in a position where we could benefit from more cash that would allow us to grow more quickly," he said. "But we're still able to grow and meet our needs under the current circumstances."

It's been a good year, one that Chipman says the company is proud of, still, he says: "I'm pretty sure nobody at Google is shaking in their boots yet."

Want to share your company's story? Drop me a note.-Jim