Ophir Tanz: The Future of Content Licensing

>> Vince: Hi, welcome to Dog and Pony, I'm Vince Thompson. The traditional media rules for licensing content don't really apply online

Ophir Tanz, CEO of GumGum has a system for making money with online content that he believes the industry

will soon embrace. Having successfully sold two previous companies I definitely want to hear what he has to say. Ophir tell us about

GumGum.

>> Ophir: GumGum is a content licensing platform; we've effectively developed an entirely new way to license content on the Internet.

Offline content is licensed for a finite period of time and to a predictable audience. So you look at Time Magazine for example, Time

has 4,000,000 readers, it's on newsstands for one week and these parameters can be used by both content owners and publishers to effectively

determine a license price. Now, that works really well offline but the problem is that the industry has attempted to apply that same

model to the Internet and what you have as a result of that is an entirely broken and inefficient system. Because content on the Internet

lives forever and usage is entirely unknown, so it makes no sense to charge a flat-rate fee because you don't know what that fee should

be.

>> Vince: With GumGum I can pay each time an impression of the ad is viewed by someone?

>> Ophir: You're only paying for the value that you're able to extract from the given photograph so we track every single impression

that a piece of content receives forever, we bill publishers based on those impressions. A content owner sets a CPM, cost per thousand

impressions, publishers come along license as much content as they want based on that CPM and we track and bill them.

>> Vince: Tell us about some of the customers that are currently using GumGum.

>> Ophir: Since we launched we've been primarily focusing on the entertainment vertical and now we're expanding into other verticals.

So, we have sites as small as Celebrity Dogwatcher, we have clients as large as MTV and Gawker and we have a very long waiting list

of publishers.

>> Vince: So what's the next step, how did you make this happen from this solution -- company.

>> Ophir: Yes, so, we had just sold a company so we had some cash that we decided to throw into this new company, we hired a consultant

and we started developing the technology just to get a proof of concept. So, ya know, we put about 50, $60,000 of our own money into this

company just to get it off the ground to develop this proof of concept, it worked, we were happy with it so we started shopping it around

to VC's. During that period of shopping it around we actually raised 2 rounds of Angel funding to keep pushing us along and, ya know,

we did the whole Silicon Valley thing and met with all the VC's and, ya know, raised money from fresh young capital and cross-cut ventures.

>> Vince: What lessons have you learned, as an entrepreneur, that you're now applying to this company, third time around?

>> Ophir: Yeah, so I've learned a lot of lessons, I've been through a lot of ups and downs in my companies, I've worked with a few

different partners. Ya know, from a partnership perspective a partnership is really like a marriage; this is the third company I'm working

with Ari. We've really kind of hit our stride in just working together we really understand our roles very well, understand each other's

strengths and just having a partner you can rely on and trust and knowing that he can rely and trust on you is just half the battle when

you are in a partnership. So, I think the single most important thing is to really be passionate about the problem that you're solving

and just being excited about going to work every single day because it's something you really put your heart and your soul into. You

work insane hours, for me it never feels like work it feels like a privilege, I think Ari feels similarly. So, I would never recommend

a person to go out and just be an entrepreneur it's very difficult, very risky, very intense kind of road you have to shovel. But I think

the individuals that are kind of built for it naturally will fall into it and there's no other way.

>> Vince: GumGum, $1,000,000,000, what's that celebration gonna look like?

>> Ophir: That celebration will look like a yacht.

Laughing

>> Vince: There you go.

>> Ophir: I don't know, there's something I love doing, it's really, it sounds cliche' but it's really not about the money --

>> Vince: Yeah

>> Ophir: I think that money is just a good metric to measure your success but I think that, ya know, I'll probably be doing this

for a long time to come. I may take some time off to go surf on an island for a while and to hang out but, ya know, it's really not

about the money it's really about the love for solving real world problems.

>> Vince: Yeah, it's great, Ophir Tanz, CEO of GumGum, thank you so much for being here. As always, if you have questions, ideas,

you'd like to maybe suggest a guest, we'd love to hear from you, send us an email Info@DogandPony.com. I'm Vince Thompson, thanks for

watching.