Having just announced the launch of O Labs, Manatt Digital Media’s latest “incubator” style venture with Originate and ICM Partners, Peter Csathy was able to delve deep into the projected future of digital. With a long history in the industry, ranging from executive positions at SightSpeed, MusicMatch, and eNow (each acquired by Logitech, Yahoo, and AOL, respectively), Csathy is more than equipped to make predictions and share his expertise on the rapidly growing world of online media.
From copyright to YouTube competitors, Csathy’s voice rings out across all the hot topics in digital. We’ll let the answers to these five questions speak for themselves…
Could you tell us a bit about how Manatt, ICM, and Originate came together to form O Labs?
Discussions began well over one year ago, very informally, between Matthew Pierce of Originate and Sarah Chambless of Manatt. Over time, these evolved into the unique vision of what O Labs is today, which was always the goal — i.e., to break the mold and create a development-driven “incubator” that covers the most critical bases for entrepreneurs and offered value that others couldn’t. And, that includes Manatt’s legal and entrepreneurial “real world” business advisory services and connections. As discussions progressed, marketing, branding, and different meaningful connections (such as talent) became obvious key ingredients to bring unique and differentiated value — and that’s where ICM entered the picture. ICM shared our same passion to break the mold for the benefit of innovators and innovation. And, that got us to where we are today.
In your blog, you mention that O Labs is similar to an “incubator,” but insist we not call it one. Could you elaborate on that?
From the start, our goal was not to simply replicate an incubator model that already exists — and the economics that go with it. Focused instead on Originate’s unique global development muscle as O Labs’ foundation, we set out to create a different kind of animal with a unique and very practical value proposition for entrepreneurs (including hands-on software/product development and legal/advisory services to kick start the vision into life). O Labs essentially funds all development for its portfolio companies, mitigating those significant risks that face any entrepreneurs — which then optimizes the opportunity for success (and powers the potential for a significantly higher return on investment). And, we are not aware of any other “incubator” that looks at it in this way, especially when you add the other pieces to the equation — Manatt and ICM.
Though there will not be a particularly strong focus on video at O Labs, where do you see video creators fitting into the business model? How can they benefit from what O Labs has to offer?
We take a broad view of relevant opportunities. The common strand is innovation. And, of course, we look for opportunities that “fit” nicely into our differentiated vision — and entrepreneurs who believe in it. This absolutely includes strong interest in video opportunities, an area in which we at Manatt Digital Media have deep interest, connections, and experience. We have directly invested in several digital video companies, including leading MCN DanceOn, video-focused social networking company MovieLaLa, and direct distribution and monetization platform LittleCast. And, take O Labs’ first “incubated” company, Versus. It is a video company that is on the forefront of innovation in the digital media space. It brings legal, real-money VIDEO game tournaments to market. O Labs is based in the heart of the creative community here in LA — and video is the soul of that LA-based creative community.
Manatt, Phelps & Philips will provide “business consulting and law” services at O Labs. What kind of role do you see the legal aspect of the company playing in the issue of copyright?
Critical legal issues face all video-focused digital media companies (including, but not limited to, copyright) — and, I joined Manatt Digital Media because I believed we could address those issues, as well as a broad swath of other critical business and legal issues that face entrepreneurs, in a uniquely compelling way. Legal considerations are foundational for all video companies … and virtually all digital media companies.
Deep legal experience in all things media (including video) is in Manatt’s DNA — going back nearly 50 years. And that includes copyright as one element. But, Manatt Digital Media uniquely extends that to include business consulting services and connections. And, we also add the third ingredient of venture capital to the equation, underscoring our commitment to entrepreneurs. We doubled-down on this commitment with O Labs.
How do you weigh in on the talk of potential YouTube competitors? Who are they?
The list is long here. But, certainly a conversation I now hear over and over again is the desire by many to look for alternatives to YouTube (which, by the way, does not necessarily mean that those alternatives are in lieu of YouTube — in fact, most video creators with whom I speak do not see it as being an either/or proposition). This talk inevitably leads to new visions and new opportunities. We see that today. Yahoo is widely expected to launch its own YouTube-like platform any day now. Amazon just recently launched its own v1.0 vision, which some see as experimentation with a YouTube-like model. And, of course, Vessel has created significant “buzz” already in its semi-stealth mode. Compelling DIY video platforms also are being built right here, right now — in stealth mode. I know some of them — they are exciting and have their own unique vision. Again, more choice means more opportunity for video creators. And, for voracious consumers of video ….