We had earlier written about more online DVD rental companies getting funding. It’s actually happening. Delhi-based online DVD rental company Madhouse Media has closed an angel round of $228,000 (Rs 1.05 crore) from Band of Angels in Delhi and Mumbai Angels of Mumbai, besides a few other private investors.
The company was founded in December 2004 by first-time entrepreneurs Sameer Guglani, Nandini Hirianniah and Ankur Agrawal (more about team here.)
Madhouse has both online and offline presence, and a statement from the company says that it’s the only one to have such a model. The company is currently focused on North Indian markets - Delhi-NCR, Chandigarh, Panchkula and Mohali regions. It, however, has plans to do a national roll-out in the next two years. The statement also added that it is currently working on some key business alliances to serve the customers better. One such alliance was struck recently with Netkode Solutions, which is working as a technology partner with Madhouse. (Netkode also provides end to end technology solution to Hollywoodclicks.com, Singapore’s largest online DVD rental service.).
Madhouse’s angel round is very small compared to the huge $7 million venture capital funding Seventymm.com received from Matrix Partners India a few months back. I am surprised why Madhouse has gone in for a small round of fund raising when the business is getting crowded. It’s likely that Madhouse will close a bigger round in a few months’ time.
It is also likely that Madhouse will focus its energy on expanding in North India rather than spreading it too thin. Bangalore-based Seventymm.com has also launched its service in Delhi, though.
Another online DVD rental company in Delhi region is the Gurgaon-based Cinesprite. This company is already angel funded.
With Moser Baer’s recent launch of Hindi movies on DVD at Rs 38 and also with the advent of movie downloads, there have been several questions raised about the long term viability of the DVD rental business. Let’s see how this business pans out.