11 Months after Launch, Montreal’s 5by Gets Acquired by StumbleUpon

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Silicon Valley-based StumbleUpon has acquired Montreal-based video curation startup 5by for an undisclosed sum today. The move comes just eleven months after CEO Greg Isenberg launched the platform. It marks StumbleUpon’s first acquisition.

5by asks users a few quick questions before they can enjoy a never-ending stream of videos hand-picked for them, like how much time do they have and what kind of a mood they’re in. It instantly curates a set of short videos from Youtube, Vimeo and others. Not surprisingly, it calls itself the “Sonza for video”.

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Now StumbleUpon has purchased Isenberg’s creation. The Montreal serial entrepreneur who helped build Wall Street Survivor and cofounded Good People Ventures, said he was “thrilled” at the acquisition.

“We’re super excited and all of us have thought of stumble upon as the pioneers of discovery,” Isenberg told BetaKit. “When we started the company it was all about video discovery: how do you cut through the 15 million videos being uploaded everyday, and package it in a way that is interesting to people?”

StumbleUpon was founded in 2002 and was once owned by eBay before new investors repurchased it in 2009. More than 25 million visit the site to be informed, entertained and surprised by content and information recommended just for them. In addition, more than 80,000 brands, publishers and other marketers have used StumbleUpon’s Paid Discovery platform to tell their stories and promote their products and services.

By 2011 it had already hit 800,000 “stumbles” a month. In fact, as of last week it is profitable, and it expects to grow revenue as much as 33 percent to $40 million this year.

The entire 5by team will move from its Montreal-headquarters to StumbleUpon’s offices in San Francisco, and will act as a division of the larger company.

StumbleUpon CEO Mark Bartels revealed last week that more than 20 percent of sales this year are projected to come from applications for smartphones and tablets. It made sense for Bartels to acquire 5by. After all, from the beginning Isenberg had a plan to make the service prevalent on every screen. “If there’s a pixel, we want to be on it,” he said.

Now with the opportunity to take advantage of StumbleUpon’s millions of users, 5by is set to grow to new lengths. It’s iOS app should be finished in a few months.

For those close to Isenberg in Montreal’s startup community, the announcement wasn’t surprising. Some even expected this kind of success to come his way. With a genuine personality that has won him many supporters, as well as a flair for solving problems in the digital age, Isenberg has achieved much success at the young age of 24.

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To this day he’s still never actually worked for anyone other than himself, and it’s difficult to say how long he’ll remain at StumbleUpon under the direction of others. Nevertheless, he said that since the deal closed the entire 5by team has been working harder than ever.

“It’s exciting for me to work for someone,” he said. “There’s a lot of smart people that work at StumbleUpon and I’m excited to meet them and learn from them.”

Launched in October of last year, 5by sifts through billions of videos on the Internet and helps users get to the ones that they care about. The startup quickly gained venture funding from Real Ventures among others, and had a glitzy launch at Launch 2013 in California, in front of nearly 6000 onlookers

When I spoke to him eleven months ago, Isenberg told me that the video-filtering aspect of 5by makes the customer experience rewarding and easy. On the heels of today’s acquisition his words make him seem like quite the clever man.

“Lets face it, today in the video space there’s hundreds of millions of videos out there,” he said. “And I think that this interface really conquers that problem in a really simple way.”

Joseph Czikk

Joseph Czikk

Joseph Czikk is Managing Editor at Betakit. Prior to Betakit Joseph wrote for the National Post, Montreal Gazette, Vancouver Sun, Regina Leader Post, Techvibes and BC Business Online. Joseph often goes crazy on twitter during NHL and NFL games.