Normally, it would have been impossible for local vendors & regional businesses to take their advertisements and promotional activities on bigger platforms such as leading TV channels, bigger billboards, and similar platforms to expand their businesses and get recognition nationally & internationally considering the higher costs involved. But, one media-tech start-up changed everything for them after its launch in 2008, which goes by the name Amagi.
Founded by a group of three close friends namely, Baskar Subramanian (CEO), Srividhya Srinivasan, and Srinivasan KA in the year 2008 in Bangalore, India. Amagi is the new-age cloud-based media-tech start-up that offers end-to-end cloud-managed live and on-demand video infrastructure to content owners, broadcast and cable TV networks, and OTT platforms for the customers.
Since its inception in 2008, the business has met with impeccable successnot only nationally but also on an international level making its net worth exceed over $1 bn as of March 2022, making it one of the businesses to reach unicorn valuation in early 2022. In the last two years, the business has developed over 100 percent and has maintained its profitability. Currently, it supports 500+ content brands, and 800+ playout chains, including more than 2000 channel deliveries on its platform in over 40 countries and generates around 2 billion ad opportunities every month while supporting OTT ad insertion for 1000+ channels.Read further to find out about how the business concept was conceptualized, its business model followed, customer acquisition strategies adopted, revenue generation over years, its plans, and many more.
Amagi- Mission & Vision
The word ‘Amagi’ has been derived from Sumerian language means ‘freedom’ and was launched to allow freedom to the content owners to visualize their content on bigger platforms and at the same time allow customers freedom of choice for the content. It was born to challenge and revolutionize the manner of content visualization & content delivery systems by way of path-breaking technologies aimed to pioneer cloud-based broadcast and advertising technology solutions.
Around 2008, the three co-founders Srividhya Srinivasan, Baskar Subramanian, and Srinivasan KA were looking to start up after their previous wireless technology-based company got acquired by an American Semi-conductor company SiRF. For a new start-up, they had three objectives in mind to be fulfilled included-
- Creation of a disruptive and revolutionary technology
- Such technology should create a bankable business; and
- Disruption should come through innovation
Therefore, the founders aspired to bring a revolution in the media & entertainment industry by virtualizing broadcasting operations by making use of Cloud-based SaaS technology and the leader in cloud-based SaaS technology for broadcast and connected TV, which would have been impossible to think of until the Cloud technology came into the picture in the media industry.
Amagi– How did Amagi come into being?
Interestingly, the three founders Baskar Subramanian, Srividhya Srinivasan, and Srinivasan KA, were sitting in a park where a palmist offered to read their palms and predict their future, while they were looking for ideas for their next entrepreneurial venture. The palmist stated that he ‘targeted’ only them as they seemed the most probable out of others who needed his help and they were in between one venture to the other.
Thus, the word ‘targeted’ clicked the idea of a start-up that could help to target a solution to a bigger problem. As part of their research, these three founders also traveled to the United States and some other countries to examine the existing situation of the media & entertainment industry there and felt that the technology existing was expensive and unscalable. Also, for a technology to work in India, it had to be low-cost, accessible & scalable to small-time advertisers.
Till the 2000s, advertisements on bigger platforms were a luxury that could only be afforded by larger corporations that small-time regional advertisers could not even think of. Such larger technology could have a transformational impact in this area by building a network of local advertisers and offering them geo-targeted advertising on traditional TV.
Emphasizing the fact that technology has the power to transform the media & entertainment industry by making it more competitive will ultimately benefit the service providers as well as its end-users.Finally, they decided to resolve the problem of ‘targeted advertising on traditional TV’ with the use of real technology with the intervention in the area by building technology from scratchand later expanding it to 3000 cities at a time, which was the start of Amagi.
For this, they created a targeted advertising infrastructure in the country by splitting the satellite signals at specific locations and inserting new ads. This idea received instant liking popularity among advertisers. Now, advertisers could choose to target ads at multiple locations at costs lesser than charged for a national TV ad slot thus gaining more visibility at a fraction of the cost. This was the genesis of Amagi’s venture into the world of advertisement which led to even bigger innovations on larger scales. Next, the business quickly adopted cloud technologies to evangelize cloud technologies for broadcast.
Baskar Subramanian (Co-founder & CEO)
Baskar is a serial entrepreneur with several patents registered under his name and is currently serving as the Co-founder & CEO of the Amagi business.He holds a bachelor’s degree in Technology from the Government College of Technology (GCT), Coimbatore, India, and started his career as a software engineer in Texas Instrumentsbefore embarking on his entrepreneurial journey.
Baskar regularly shares his insights and expertise with start-ups and small businesses. He is a well-recognized speaker at several industry events and speaks often about the use of the cloud in the broadcast industry.Being the CEO, he drives vision, growth strategy, and execution, enabling the transformation of the global media and entertainment industry through technology innovation. He has also played an instrumental role in the development of various path-defining technologies on cloud broadcast and frame-accurate ad splicing for both TV and OTT.It is under his leadership that the start-up has establisheditself as a leader in SaaS-based solutions for content broadcast & monetization.
KA Srinivasan (Co-founder & Chief Revenue Officer)
KA Srinivasan is a technology entrepreneur having experience of more than 23 years in setting up and scaling businesses. He completed his Bachelors Bachelor’s degree in Computer Science from the Government College of Technology (GCT), Coimbatore, India, and started his career at Texas Instruments as a software engineer. Being the Chief Revenue Officer& Co-founder at Amagi, he played an instrumental role in the revenue growth inclusive of sales & marketing, helping it to be a global leader in SaaS for content broadcast & streaming content on the cloud. Further, Srinivasan is also an avid speaker who speaks regularly at global industry events, evangelizing the application of cloud technologies for channel creations & monetization.
Srividhya Srinivasan (Co-founder & Chief Customer Success Officer)
Srividhya is one of the few women entrepreneurs in the field of the media broadcast industry who have set examples for others by conceptualizing & introducing pioneering products for global markets.She has been always passionate about technology and building something new out of it, and believes engineering is the reason for her existence.
Like the other two co-founders, she also completed her graduation from the Government College of Technology, Coimbatore, India, and had her 23-year-long career as a software professional with Texas Instruments. At Amagi, her roles and responsibilities include advising global clients on issues such as the deployment of suitable cloud architecture, building custom solutions, and ensuring a smooth transition of clients towards cloud broadcasts.
Amagi Business & Revenue Model
The cloud-based media tech offers three business models to its clients to choose from as per their requirements, which include-
i. Software-as-a-Service (SaaS)
ii. Bring your own license
iii. Fully Managed Service.
It also dealsin a revenue-based share model with content owners and platforms based on their ad insertions. It also has diversified its business segments to be offered to customers through services such as-
i. Channel Creation And Distribution, And
ii. Monetization.
According to Srividhya, the unit of economics for the Amagi monetization business isCPM-based (charges are added per 1,000 impressions generated) combined withthe inventory share revenue model where a percentage of the revenue from an ad inventory sale is retained by the business. Likewise, for content creation &distribution purposes, the revenue depends on the number of channels created and the number of distribution end-points.
Amagi- Unique Value Propositions
i. Cloud-Based Tech Leader – Amagi cloud solutions is the pioneer of the application of cloud-based technologies in the media & entertainment industry with no dedicated hardware resources and allows a choice of cloud platforms to the clients-Amazon Web Services (AWS) and Google Cloud. Other features include-
- 6 to 8 times lesser costs on cloud services
- Optimized using micro-services, on-demand instances without GPUs
- Unified broadcast workflows
ii. Comprehensive Solutions-
Amagi services comprehensive services including services from broadcast-grade 24/7 linear channel creation to distribution across satellite, cable, and IP, to OTT server-side ad insertion and analytics for monetization they offer end-to-end infrastructure for broadcast operations on the cloud.
iii. Comprehensive distribution network-Amagi offers its clients to distribute content across satellite, cable, and IP networks with its FAST platform distribution network, which includes up to 50+ FAST platform partnerships globally that allow content owners to share their content across any platform in any part of the world.
iv. Flexible Working Model-With a flexible working model, Amagi has allowed its customers to manage hundreds of channel feeds and scale up at will from any remote corner of the world using its solutions, which has provided tremendous value to its customers with the immense capability and agility of its solutions, which has, in turn, giving the startup a high customer retention rate (as higher as 127% net retention as of July 2021).
v. Customer Acquisition Strategies-For its Indian ad business as well as the global cloud broadcast business, Amagi engages with customers on-demand as well as supply sides while demonstrating its value-add its solutions, which is a major part of its customer acquisition strategy. Since the beginning, its business model was such that it could sell the same spot through as many regional advertisers as possible with the view that the sum of the parts will eventually be greater than the whole approach that has led it to sell millions of ad seconds per month.
Amagi-Funding& Notable Investors
To date, Amagi has been able to secure a total sum of $240.2 million in over 6 funding rounds, out of which the latest tranche of funds came on March 16, 2022, when the company was successful in raising $95 million worth of funds from investors such as Accel and Norwest Ventures, Avatar Ventures, etc. and more. This funding round helped the company gain a unicorn valuation, thereby making it the 11th Indian start-up to join the unicorn club of companies in 2022.Amagi earlier raised $100 million last in September 2021, from a bunch of investors including Emerald Media, Mayfield Fund, and more.
Lately, Amagi also organized a buy-back of shares worth12 mn from its founding team and employees, out of which the Amagi board approved abuyback of 76,533 equity shares at Rs 11,998.63 per share, which would amount to $12 million (Rs 91.8 crore) as disclosed from the regulatory filings made by the start-up.
Amagi-Growth & Challenges
Though most of the businesses experienced slump growth with low or zero revenues during the pandemic, the Covid-19 pandemic and lockdown restrictions accompanied by OTT platforms and the growth of Free Ad-Supported Streaming TV turned out to be major opportunities for Amagi causing the rise in the adoption of cloud-based solutions infrastructure for broadcasting and an upward trend towards the growth of the business.
Presently, Amagi is known to support more than 650 brands and more than 800 play-out chains, and deliver 2000 channels to more than 40 countries in the world. Further, it generates more than 2 billion ad opportunities every month supporting OTT ad-insertion for 1000+ channels targeting an audience of around 2 bn and counting, leading to a total business worth around 1 bn that also makes it one of the highest valued media-tech companies worldwide.
For this very reason, Amagi is enjoying a profitable position for the last two years accounting for a total of $28.61 mn (Rs 219.3 cr) for the FY21(compared to 96.1 crores in FY20) was a 136% increase in annual revenue and a consecutive growth of 18% in revenue in the quarter ending June 2021. Similarly, for FY21 the total revenue earned from its business operations in the US reached Rs 143.7 cr (resulting in a 3.3X YoY in FY21) and from the rest of the world became Rs 31.5 cr (also increased by 99.4%).
However, the journey has not always been a smooth –ride since the beginning, as it had to face challenges such as-
i. Entering Collaborations with Operators- Since content owners had a limited understanding of cloud-based technologies which Amagi was building from scratch, very few were willing to take that risk. Thus, the media-tech start-up had a hard time explaining and convincing them about the potential& cost-effectiveness of cloud infrastructure.At the beginning itself, Amagi had to collaborate with around 20,000 cable operators in Tier 1 & Tier 2 cities at that time, which was a herculean task to start its business operations.
ii. Convincing Media Partners about Ad-insertions– On the other hand, Amagi had to convince media channels to allow ad insertions between their contents. Since Amagi was inexperienced in local advertising of the ad content, it could not assure media channels that it will not hurt their audience as they were also unsure of the Amagi business model. To counter this problem, Amagi created-
- Its own in-house ad sales team would buy ad inventories and then sell them to local advertisers at its own risk
- A creative team that would tackle the challenge of ad content ambiguity.
iii.Turning from Ad-Tech provider to SaaS-based Platform-Though, it started primarily as an advertising solution provider to offer advertising solutions to local businesses’ TV channels, later started afresh with a SaaS-based monetization platform for TV networks and content owners around in 2018. This process of change was painful for Amagi as it had to cut down its expenses and lay off half of its total workforce. However, Amagi came out strong on its growth & profitability with skyrocketing revenues touching the Rs 200 crore mark along with churning significant profit for FY21.
Amagi -Recognition& Awards
Undoubtedly, Amagi media-tech has been a pioneer in the media-tech industry that has revolutionized the media & entertainment industry for the betterment of smaller content owners through the democratization of bigger platforms, and has won several awards and accolades for the same including-
- Fastest2nd Fastest-Growing Tech Firm in India, 2012(byDeloitte)
- CNBC’s 10 Hottest Start-ups in India
- Stevie Gold Award for Medium-Sized Company of the Year (Media & Entertainment) and Stevie Bronze Award for Cloud Application / Service of the Year.
- IBC Innovation Awards Winner 2015
- CII Design Excellence Award 2017, and
- Sullivan’s Global Product Innovation Award 2018
Amagi- Current Scenario &Future Plans
Therefore, Amagi has come a long way since its incorporation and successfully established as one of the leading media-tech platforms with an active presence in India as well as many as forty countries around the world and is still in expansion mode. The streaming TV revolution has created new prospects for the content owners to create, distribute, and monetize channels and the viewers to enjoy more choices in high-quality content. It has democratized smaller businesses to offer low-cost playout options helping them to create a compelling viewer experience for their audiences by placing them on an equal status with larger broadcasters & platform owners.
Presently, Amagi takes pride in its ambitions and honest efforts to improve its performances. Having its head offices in Bangalore India & New York, USA, the business has already expanded to include Latin America, Canada, and different parts of Europe. The co-founders emphasize thinking freely without any ‘boxes’ in their minds that could help them to deliver breakthrough results, driving exceptional outcomes for their customers. With an employee strength of more than 400 in its organization, the media-tech unicorn is also looking forward to on-board premium tech talent for various functions including Engineering, Product Management, and Global Sales roles in India and its international locations.
After witnessing skyrocketing operating revenues and profits, now it plans to offer a self-theservice portal to its customers which will enable the customers to enjoy the benefits of all the products in its tech-stack i.e. channel playout solution, Amagi CLOUDPORT, its server-side ad insertion solution, Amagi THUNDERSTORM, its live orchestration, and lightweight content scheduling platform, Amagi LIVE and AMAGI PLANNER, etc. all through a single window.
