Roku seeks $30M funding, cuts STB price, weighs IPO
Set-top box maker Roku is planning to raise $30 million this quarter to expand its engineering and marketing as the push for OTT delivery heats up with Xbox, Sony and Nintendoh all increasing their streaming offerings. The company - which has sold more than a half million of its units after being spun off from Netflix - also said it's hoping to float an IPO sometime next year.
Roku CEO Anthony Wood said he expects the company to see $75 million in revenue in 2010, almost doubling sales in 2009, and to reach sales of 1 million total units, Bloomberg reported.
Wood also said the Roku box eventually would be given to consumers fro free, saying, "We see hardware margins becoming less important over time and subscription content becoming more important." He said the company will reduce the price of the device this quarter from $115 to $80.
While the company has seen strong growth since Netflix spun it off with $6 million in seed money, Wood declined to give specifics on its market value. Netflix has since sold its stake to VC firm Menlo Ventures.
Wood says no date has been set for an IPO, adding that the company has yet to hire an investment bank to push the offering forward. "Our goal is to go public," Wood said. "If things continue on this trajectory, I think it would be viable to go public next year."
Roku in November rolled out a "channel store" and currently is recruiting devolpers to bring more content to the service. Wood said Roku hopes to offer 100 channels by year's end.
"We're not far away from the time when you'll be able to get the same kinds of channels that any cable operator can offer," he said.
- see this Bloomberg report