Ethereum-based decentralized video streaming startup Livepeer announced that it secured an $8 million Series A venture capital round headed by Northzone.
Seeing a significant surge in video streaming across the web and the prohibitive costs associated with transcoding, serial entrepreneurs Eric Tang and Doug Petkanics developed a platform linking encoding providers with those in need of processing power for video services.
The infrastructure operates as a “token coordinating network,” rewarding those with computing power to participate and provide the needs of those who want to stream, by allowing them to get compensated for their surplus processing power in Ethereum.
The firm presently has over 30 compute power providers, and at least 100 events have streamed video via Livepeer. But, Petkanics admits those users have been an “early-adopter, philosophically-aligned crowd.”
Livepeer is intended for users who want to stream video, entertainment, coding, educational courses, or gaming, developers who wish to create apps that include live video, and broadcasters with a vast audience and high infrastructure costs or streaming bills.
By utilizing idle processing power, Livepeer reduces the cost of encoding. Per Petkanics, the system is 10x cheaper than incumbent streaming providers. That is equivalent to two streams for approximately 70 cents a day versus $3 per stream per hour of popular streaming services.
Founders find a growth opportunity in bootstrapping the surplus capacity of GPUs utilized by cryptocurrency miners, hence further driving down costs. The Series A funding will be used to implement applications beyond crypto supporters and enter the broader marketplace.
Aside from Northzone, StakeZero, North Island, Notation Capital, Digital Currency Group, Collaborative Fund, Libertus, Compound, and Houseparty founder Ben Rubin joined the round as well.