MUBI, an online-movie service catering to independent and art-house film enthusiasts, said it’s closing a $7.5 million fundraising this week after hooking up with Samsung Electronics Co. to offer its service worldwide.
Joe Osnoss and Simon Patterson, co-heads of Silver Lake Management LLC’s Europe investment business, film producer Eric Fellner, and Pascal Cagni, who oversaw Apple Inc.’s Europe, Middle East, India and Africa operations as vice president until 2012, are among MUBI’s investors, Chief Executive Officer Efe Cakarel said in a London interview. Samsung, the world’s biggest maker of smartphones and televisions, agreed to offer the service on its smart televisions and BluRay devices, he said.
“We are seeing massive growth in the U.K. and Germany, and increasingly Turkey,” said Cakarel, who worked at Goldman Sachs Group Inc. from 1998 to 2002. “We’re in both developing and developed markets, but we’re most excited about emerging markets that have strong potential for growth.”
MUBI, based in Palo Alto and London, predicts revenue will climb to about $100 million in three years from its web-based subscription service, tapping demand for online-film entertainment. Netflix Inc., the world’s largest subscription streaming service, reported profit jumped more than fivefold to $48.4 million in the fourth quarter as its domestic video customers rose.
MUBI’s subscriber base has been growing at a rate of 3 percent a week for the past 18 months, according to Cakarel, 37, who said he worked on public offerings, mergers and private equity investments at Goldman Sachs in London and New York.
A new film is selected by the website every day, with 30 movies available for streaming at any given time. At 2.99 pounds ($4.96) per month, a MUBI subscription is about half the price of Netflix’s video-on-demand service. The number of registered users is currently at 7 million, according to Cakarel.
MMC Ventures Ltd., a venture-capital company, is also among MUBI’s new investors, according to Simon Menashy, an investment manager at MMC in London. MMC will provide its own funds and part will come from the MMC London Fund, which it manages with Mayor of London Boris Johnson’s office, Menashy said.
Floreat Group provided $2 million in funds, Hussam Otaibi, a managing partner at the London-based private investment office, said by phone today.
“Netflix is spending a lot of time fighting a very hard battle” with Amazon.com Inc., Google Inc. and others in the U.S., U.K., and Germany, Cakarel said. “I see a very significant opportunity to grow a meaningful business in a lot of other territories.”
MUBI, founded in 2007, will receive $2.4 million in its second round of financing due to close this week after getting $5.1 million in November, Cakarel said on March 7. The company started services in Mexico in the past month and is seeking to raise $50 million in 2015 as it expands into Asia, he said.
Current MUBI picks include Pedro Almodovar’s “All About My Mother,” Lars Von Trier’s “Manderlay,” Nikita Mikhalkov’s “Burnt by the Sun,” and Danny Boyle’s “Slumdog Millionaire,” which won the Academy Award for Best Picture in 2009. Martin Scorsese, film director, writer and producer, is a member of MUBI’s website, according to Cakarel.