Veoh Filing For Bankruptcy Soon

February 12th, 2010 at 12:00 am
 


Veoh Logo

Veoh, a social media site that is similar to Google’s YouTube, may be on the way of filing for bankruptcy. It has recently laid off the remainder of its workforce and may be filing Chapter 7 bankruptcy protection any time now. It seems a sad ending to something that has been known as one of the well-funded start-up online companies out there.

Veoh came into the picture with funding support from major investors with the likes of Goldman Sachs, Time Warner as well as Spark Capital which is the investing arm of Intel. But it seems the lack of a unique product to offer, coupled with the virtual lack of generating income may have led to its demise. It got worse because of the copyright infringement lawsuit that the Universal Music Group slapped on Veoh. This lawsuit also made it quite difficult for its CEO Dmitry Shapiro to find willing buyers for the company, even willing to accept less than the over $70 million that its investors poured into it.

Some glimmer of hope was seen when Veoh was able to win the said lawsuit effectively. But then the struggle has weakened the company despite its victory. The company thought that it would convince its current investors to pour more funding into the beleaguered website to continue its operations. Sadly, this was not to be so. This led Veoh to consider raising the white flag after years of struggle. The layoffs have been announced and it would only be sometime before bankruptcy filing may be on the way. Well, that is how the rabid world of Internet business works and it has taken another victim.