Today, Internet users are overwhelmed with options to share and consume various types of media. But the solutions are very partial, focusing each on only one type of media (with the exception of Facebook perhaps). As users start accumulating more and more devices capable of capturing HD media, the need to share and store that media across different screens becomes apparent. That is where Libox, a new Tel Aviv-based startup offering a free service to share and store photos, videos and music, wants to disrupt the industry. To learn more about the product and the founder’s ambitious vision, I interviewed Erez Pilosof, founder and CEO of Libox who also founded and ran Walla! (Israel’s largest online portal) from inception to IPO as well as Oren Nauman, formerly CEO of Mobival, who serves as deputy CEO at Libox.
VC Cafe: What’s the story behind Libox? Can you give us some background on the vision for the product?
Oren Nauman: (for technical reasons, *ahem*, Skype, Erez had to miss the first few minutes of the call) Erez founded Walla when he was very young (22), and led the company from the age of 22 and led the company for 11-12 years, from when they were 4 people to an IPO on TASE. He made it very profitable.
He took time to travel and during his travels took a lot of videos/pictures. He started to look at his own experience with music and media as a user. Uploading downloading, saving files, connect it with cables here and there, facing compatibility issues… a mess. He then thought, let’s rethink how we share and view the whole media. He’s a coder himself and believes that any problem can be solved.
Erez Pilosof (after overcoming Skype): I started Libox for a personal need. I had a lot of gadgets and wanted to share my media with my friend. Today people have a multitude of devices from smartphones to computers, netbooks, etc. I wanted to easily share high-definition media with friends. I had a lot of high definition pictures and videos, which today you can get with any camera that has at least 10mgpx. You need a place to store it, and an easy way to share it.
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VC Cafe: Tell us a little bit about what’s under the hood.
Erez Pilosof: Libox uses a combination of technologies. Intelligent thinking/streaming. All the heavy lifting is done behind the scenes and we allow your devices to allow you to just enjoy. It’s a totally private solution.
We wanted to make everything free and unlimited. Our system is managed by a patent-pending combination of distributed, grid and peer to peer technologies along with sophisticated analytic algorithms to do the smart matching between your media and the device. We pull in cloud resources when we need them, creating private clouds between devices that access the Libox Platform. There’s no way to do cloud storage for free, so Libox has developed a way to let you take advantage of the storage you already own, along with your network of friends and family, to make free multimedia sharing possible, instead of using expensive cloud computing.
VC Cafe: Sounds like there’s a lot of caching and data transfer. What’s the impact on performance on the PC?
Erez Pilosof: When you do the first import, like any software you use for the first time (including iTunes), it will take a little longer. But on a daily basis, the resource use really depends on what you’re doing. If you are just viewing your pictures, it doesn’t take any resources. We analyze your bandwidth and make all your stuff very simple. We get better as we go in the decisions we’re making. Port settings and TCP connect. Today you have streaming applications that make you define all sorts of ports and settings. Our vision was to do all the hard work behind the scenes. People should be able to just play their media across devices without the hassle.
VC Cafe:Where do you see Libox 5 years down the road? What is the big vision?
Erez Pilosof: I see three types of media: your own media, media shared with you and public media. Right now we’re handling your media and media shared with you. Our first step is to radically improve our service, extend to public media that we think should be shared and discovered (we already have innovations planned in that space). Our user interface was based on HTML, which was a hard challenge. But now we can easily extend Libox by opening our developer API. It’s all based on growth and on opening the capabilities of the Libox distribution platform to the community. All you need to know is HTML, and our API consists of only about 10 commands. Sync your devices and stream – it is also not expensive to run.
VC Cafe: Can you simplify the product as if you’re explaining to a 13 year old? A combination of Bitorrent, Picasa, iTunes and Youtube?
Erez Pilosof: It’s hard to simplify.
The problem with iTunes, Picasa and Bitorrent is that they are designed for the desktop. Libox is designed for integration between all your devices. It also has syncing services that usually cost money. It’s a hard job, and a big vision. Experience your media, share your media and discover your media. It knows how to take one format of video and put it in an iPhone compatible video.
We took the other layers. How to playback on every device. Different video formats.
VC Cafe: Do you think that one of the challenges will be to communicate the benefits to users?
Erez Pilosof: It is fun to build things. It took me 10 years to build Walla. I’m not here to make a quick buck. It takes time. I’m here to make a big change, not another Twitter client.
VC Cafe: What would you say are your killer differentiators?
Erez Pilosof: You don’t have to think about files, disc space, media formats, uploads, downloads… we took lots of complications out of the equation. I don’t want to put my files in all the folders. I want to connect my camera and my Libox should automatically recognize it. Simple as that. People over pay for stuff (storage), but you have plenty of space in your PC. We want to change that.
VC Cafe: What is you business model? How are you planning ramp up the revenue?
Erez Pilosof: We’ve got several directions for income. In some areas we have unique solutions so I don’t want to discuss it right now, but as a general direction, we will offer third party services to hook to the platform and offer related services to cloud storage (Amazon, Mozy, EMC, etc). The other direction is related to media discovery. Media discovery will be a huge market. If Libox is the place where you have all your media as a consumer, it’s a huge resource for us.
Also, the nice thing about these revenue streams is that they actually help the Libox user. Our burn rate is very low and the technology is very scalable.
VC Cafe: How are you going to solve your own distribution challenge?
Erez Pilosof: When you build a great product which is useful, people download it. Look at the number of Skype users for example.
VC Cafe: So, you’re not worried about distribution?
Oren Nauman: there’s another angle around the platform. Since we have APIs, we have opportunities for business models with media and content partners. Corporations and strategic partners, using the Libox platform. We’re currently having conversation with partners in that area.
VC Cafe: Who would you define as your target audience and your main competitor?
Erez Pilosof: I think that one of the biggest problems with the market today is that you have some great companies out there, but they only solve one specific chain of the problems you encounter with your media. We’re trying to come up with a holistic solution. As a user we want to simplify. We’re trying to define a new experience.
Oren Nauman: Libox is the first and only company to allow the users to sync, play and store high definition media on a single platform. We put a new twist on peer to peer and cloud computing and for that reason we believe we don’t have direct competitors. We have indirect competitors in each of those verticals. We’re only executing on the tip of the iceberg.
VC Cafe: Do you have any privacy concerns?
Erez Pilosof:We don’t have access to your media. Right now we only share within the Libox network. We will add public web sharing and then the regular privacy practices will apply. We’re not like Facebook, we believe it’s your media, not ours. We have multiple layers of security to ensure that your media remains private.
VC Cafe: You are co-CEOs. How does your structure work?
Erez Pilosof: Oren is the deputy CEO. He’s in charge of operations and business development. I’m in charge of the product and technology and we both do marketing.
VC Cafe: Finally, what’s the biggest learning your took away from your experience with Walla and how are you implementing the lessons on Libox?
Erez Pilosof: good question. I would say two things:
1) Have patience. Building meaningful things takes time.
2) Getting the right team in place. At Walla I made some mistakes in that area and on Libox I got the greatest technology team. I picked each and every one.
Again, with patience, we’re continuously innovating, which is very important. We break our big vision to small steps. We constantly surprise people. Expect new versions of Libox in 1,2,3 months. We have a very ambitious plans.
It’s not very often that you meet a startup taking on Google, Apple and Microsoft all at once, while trying to capture the next trend of media management. I guess that is where a solid track record like founding Walla comes in handy. Libox officially laucnhed its beta platform on June 15th.
Here’s a video demo of Libox for those of you waiting to get accepted to the beta program: