Tout shoots for dynamic Web experience

Oct 20, 2011 By Peter Delevett

You might not have heard of Tout, but some big people have. People like Shaquille O'Neal, the former NBA star, and Li Ka-Shing, one of Asia's richest men.

They're both backing the San Francisco stealth startup, which spun out this spring from venerable research lab SRI. It makes a sort of "video Twitter" that major TV networks and more than 150,000 regular folks are using to create 15-second mobile videos, then share them on Facebook and other social networks.

CEO Michael Downing argues that, despite the many advances in the Internet, the experience essentially remains a static one, where people read text and look at pictures much as they do with magazines. He argues that users want something "more real - and nothing's more real than video."

Unlike your typical social-media CEO, Downing has two decades of experience in consumer Internet startups, including founding YouTube-like video site GoFish. He'd spent the past few years as an angel investor before being approached by SRI to help commercialize real-time video sharing technology it had developed.

Tout lets users of a variety of devices - including Android, iPhones and Web cameras - record and transmit their video snippets in under a minute. Asked how that's different than the newly added Facebook feature that lets users post their own videos, Downing says the abbreviated and near-instant nature of "touts" makes them like mini-conversations.

But where Tout has garnered real traction in a few short months has been among the celebrity set. O'Neal in June announced his retirement via a Tout video. Republican presidential candidate Mitt Romney uses it to check in with fans from the campaign trail.

Sporting powerhouse ESPN has taken the idea even further, featuring Tout in its popular Sunday evening program "Fantasy Football Now". Viewers are invited to tout in their questions, and the best are broadcast on-air. "It makes television into a two-way dialogue," said Downing.

In other words, now anyone can be famous for 15 seconds.

Downing says all those media-savvy users approached Tout rather than the other way around. O'Neal, for his part, said he chose the unorthodox venue to wrap his 19-year career because "I came in different, and I wanted to go out different."

O'Neal is widely known as a heavy user of Twitter, where he has more than 6 million followers. "But what I've been noticing about Twitter lately is that you don't know who the person you're talking to really is," he said. "When you can see my picture, you know it's me." The Big Aristotle was so impressed with Tout's video snippets that he took an ownership stake, though he declined to give specifics.

Downing says the major networks are also interested in investing in the company, giving him an alternative to traditional venture capitalists. The company's $2 million first round of funding, which closed in December, including backing from SRI and Hong Kong billionaire Li, who has put $120 million into Facebook (and whose first name happens to rhymes with "ka-ching").

Since its launch April 12, Downing's startup has captured 4 million unique visitors who've sent more than 140,000 touts. The wildfire growth convinced Scott Epstein, who had been Google's first vice president of marketing, to come out of retirement to become Tout's chief marketing officer.

"The more I got my head around this, the more I thought, 'This is the next chapter in social media,' " said Epstein, who worked closely with Napster and Facebook co-founder Sean Parker at Parker's professional networking startup Plaxo.

Adds Downing: "It took Twitter two years to hit 1 million visitors. We hit it in under 12 weeks."

At the same time, he acknowledges that such rapid growth is partly due to the trails Twitter and have blazed for social media. Downing expects Twitter and Google to eventually get into the instant-video field as competitors, and TwitPic, which lets users send cell-phone photos via Twitter, added video to its services in February.

Charlene Li, founder of technology research and advisory firm Altimeter Group, calls Tout "a great idea" but wonders if it's enough to build a company on in the long run. "I think it's a feature on top of an existing service," she said, "sort of the way TwitPic has evolved. But pictures are worth a thousand words, so video makes a huge amount of sense."

For now, Downing is busily working up new features for the service, including letting owners of other websites embed Tout and build new applications for it. He expects the startup's tiny staff of 10 to more than double in the next six months.

And as you'd expect from a company run by fortysomething Silicon Valley veterans, Tout is already thinking about how to make money from its surging traffic - probably by letting advertisers send bite-sized videos to their followers.

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