Video platform Special Project spins off from Bozeman-based software engineering firm Triple Tree, secures $2.3M seed round led by Next Frontier Capital
Bozeman-based software engineering company Triple Tree Research, Inc. has become Special Project, a SaaS video hosting platform.
The platform, designed to empower online creators, raised $2.3 million in seed investments with $1.25 million from Bozeman-based lead Next Frontier Capital.
Through Special, creators stream premium content direct-to-consumer and earn revenue through monthly subscriptions, rather than offer their content for free or sell their content rights to major streaming platforms. Special enables consumers to curate their own bundle of media by subscribing directly to their favorite individual creators for a monthly or annual fee.
Co-founded by Montana State University graduates Paul Burton and Sam Lucas, the team expects to launch the web platform this fall, followed shortly by mobile and Smart TV compatibility.
Sign up for early access to the web interface of Special Project, set to launch this fall.
CEO Sam Lucas, who sits on the Board of Directors of the MHTBA, wants Special to revolutionize the way creative work is valued.
“Historically, content has always been for free. It's just been a marketing channel, rather than a product that you buy, at least in the independent creator world or the internet creator world versus a Hollywood film,” said Lucas.
Independent creatives generate incredible product value for platforms—YouTube alone made $15.15 billion in revenue last year. But often the best that creators can hope for is the advertising share from their work.
“More than ever, creators are beginning to realize the incredible entertainment and educational value they are producing with their content. Content is the new ecommerce, and consumers are spending more than ever on subscriptions and digital media both educationally and for entertainment value,” said Lucas. “Creators can be charging for that content and independently building a sustainable creative business.”
Special creators set a subscription price for access to their content between $1 and $999 and choose between a monthly or annual payment schedule. Special Project then receives 10% of transactions across the platform regardless of subscriber count.
“It gives everyone the means to have the financial benefit that one might have on a larger platform like YouTube, Netflix, Hulu, or Patreon while having more direct control over their audience as well as more direct access to the money they make from the content,” said Paul Burton, co-founder and CTO. “The money doesn't pass through some black box or middle hands, [creators] get their revenue right away.”
Unlike Patreon, through which the majority of content isn’t exclusive, Burton and Lucas want to support creatives by monetizing the work itself. Special is a streaming service that provides independent creators a means to sustain themselves and their businesses rather than a donation platform.
“We want to make sure people can take their talents seriously and get compensated for it,” said Burton.
With audiences paying for video content itself, revenue will no longer be reliant on brand sponsorship.
“Advertising completely nudges the authenticity of content creation in the wrong direction,” said Lucas. “We are creating a platform for the creator that enables them to authentically produce content for the audience that loves what they do, free of ads, and monetized directly.”
In April 2017, the consequential dynamic between advertising and video content surfaced during what has come to be known as the ‘adpocalypse.’ The phenomenon began when a number of high-profile brands pulled advertisements from YouTube due to concerns of implicitly supporting vulgar or harmful content that slipped through the platform’s community guidelines standards.
In response to the limited advertising available, YouTube tightened their algorithms to further stratify the categories of videos that receive ad revenue and those that do not. This demonetized a slew of videos and caused a significant decrease in creator revenue across the board. YouTubers scrambled to edit or delete past video titles, thumbnails, and descriptions to be as brand-safe as possible and cater to the family-friendly monetization algorithm.
The structure of the platform ensured that creators’ work was first and foremost a vehicle for paid advertisements. Special, on the other hand, will center the relationship between the creator and the audience by removing ads altogether.
Creators set a subscription price for access to their content, with Special receiving 10% of monthly transactions across the platform.
Starting a creator channel, or ‘project,’ is free and simple to customize. Videomakers need only name their project, choose a color theme, and set a subscription price before uploading and organizing episodes of content. The platform offers marketing and performance insights and a discussion tool where creators can post production updates, surveys, or other information. Additionally, Special doesn’t retain rights to any of the content or projects using the service.
Special is based on a so-called passion economy model where individuals and small businesses can build an audience by interacting directly with their viewership.
While streaming platforms like Netflix effectively unbundled cable TV packages by allowing subscribers to pay less for movies and shows, Special is taking the customer experience a step further by unbundling streaming platforms themselves.
The content is entirely personalized to the user’s subscriptions, called ‘projects.’ Once a video is uploaded, it is immediately available to stream on mobile or a smart TV through the Special interface. Rather than ‘favorite’ or ‘like’ buttons, Special films will have an applause feature as a nod to the theme of theatrical viewing.
First-time users will get a certain amount of ‘freemium’ videos they can watch and share before subscribing to that project.
The Special Project HQ in Bozeman, MT. The majority of the seven-person staff are former MSU students.
Burton and Lucas met as undergraduate students at MSU, when Lucas was a junior studying business marketing and Burton was a sophomore in the school of computer science.
Les Craig, now a partner at Next Frontier Capital, had just moved from Baltimore to Bozeman in 2015 to direct MSU’s Blackstone Launchpad, an entrepreneurship initiative supported by the Blackstone Charitable Foundation.
Craig‘s first impression of Sam was that he was a big thinker. Craig witnessed “little inklings of greatness” from Lucas, recalling the time Lucas raised more money in a single year than any student club in MSU's history.
Craig described Burton, on the other hand, as an incredibly efficient executor on the technical side.
“What was really special about Paul and Sam meeting is now you had the ultimate combination of what I like to call the hacker and the hustler,” said Craig. “You’ve got the guy or the gal that can sling the code and write the program to anything your heart desires. And on the other hand, you have the visionary CEO who loves to be out in front selling product.”
The pair kicked off their technical consulting firm Triple Tree Research out of the Launchpad when they were still in school. Triple Tree was successful enough that soon after Lucas’ graduation in 2016, Burton dropped out of his junior year to focus on the company full-time.
Triple Tree was highlighted on the 2018 Montana Companies to Watch list and was featured in ‘Startup Alley’ at TechCrunch Disrupt in San Francisco later that year.
The business contracted with multiple national firms to rebuild or reskin their software products, including a Baltimore-based cybersecurity software company that Craig himself had started called Red Owl Analytics.
Lucas and Craig have kept up regularly since they’ve each moved on from the campus Launchpad, often having non-traditional mentoring sessions while backcountry skiing, hiking, and mountain biking.
The idea for Special began with Triple Tree clients who wanted custom streaming media platforms built.
“There's a pretty large need, technology-wise, for people to have a way beyond the current solutions to be able to post and distribute their video content,” said Burton. “We had a lot of concerted technology efforts and our team has spent a lot of time in this specific engineering space.”
Burton and Lucas pitched Special to Craig and Next Frontier Capital in November of 2019. NFC agreed to fund Special for $1.25 million. At that point, the company was just an idea.
“We didn't even have a name. That's why it's called Special Project,” said Lucas. “We didn't know what to call it.” He ended up liking that the name is reminiscent of old-school Sunday night TV specials.
After the investment news, Special Project was officially founded on February 18, 2020. Burton and Lucas closed Special’s funding rounds this past spring while phasing out their Triple Tree clients.
Special has caught the attention of regional and national investment firms through the seed round led by Next Frontier. One of the strongest draws for NFC was the team’s industry knowledge and technical prowess.
The entirety of Triple Tree’s 6-person staff were Burton and Lucas’ fellow MSU grads, and most of them have known each other since their college days. The full team transitioned when the company pivoted to Special Project.
“Really it got down to our conviction and this team's ability to execute,” said Craig. “If you look at their track record over the past three or four years prior to our investment, they essentially bootstrapped a company from nothing to what we would consider to be more significant than just about any team that we see in this ecosystem or anywhere else.”
The other main factor in NFC’s partnership was timing.
“We believe strongly that when you look at the competitive space and the product that Special Project is building and is offering, the timing couldn't be better,” said Craig. “In fact, what we unexpectedly realized was an enhancement of that opportunity as a result of the post-COVID environment for artists and creatives to share their content with the world.”
Technology has also made video creation incredibly accessible at this moment.
“Ten years ago, you had to be trained in video production to make a good looking video,” he said. “Today there's just so many editing tools that are free on the internet, cameras are cheaper, and the newest iPhones are shooting 4k. So it's becoming so easy to produce really high quality content cheaply... and without hiring a full crew.”
Right now the Special team is working on outreach by targeting ads to independent filmmaker subreddits and websites and reaching out to creators themselves. Interested users can sign up for early access to the upcoming launch.
Craig has seen that growing companies like Special Project in Montana creates a multiplicative effect on the state’s talent base and general tech ecosystem.
“This demonstrates and continues to reinforce to aspiring Montana entrepreneurs that funding and scaling a technology company is possible in the amazing place we call home,” said Craig.
Read more about Special Project on TechCrunch.
About the Author: Martina Pansze is the Communications Director for the Montana High Tech Business Alliance. She graduated from Whitman College with a degree in Film and Media Studies, and has worked as a freelance journalist and grant writer.
About the Publisher: Launched in 2014, the Montana High Tech Business Alliance is a nonpartisan nonprofit association of highly-engaged high-tech and manufacturing companies and affiliates creating high-paying jobs in Montana. For more information, visit mthightech.org or subscribe to our biweekly newsletter.