One of the attributes of SMB SaaS – Localogy’s core focus – is its bredth and head room. Comprising all the digital services that help SMBs run and grow their businesses, it’s much more expansive than the advertising & marketing focus that was erstwhile the focus of many “local” research & analyst firms.
With that breadth comes several new, and sometimes narrow, subsets of the SMB Saas world – everything from operational functions to obscure verticals. The latest to cross our desks is what we’re calling “streaming-as-a-service.” It consists of streaming infotainment in and around SMB locations.
In short, the value proposition for SMBs is to create a more media-rich, and thus sticky, customer experience. That can include sound-optional infotainment in your salon’s waiting area or grocery store aisles. Beyond entertainment and customer experience, it’s also ad inventory (the OOH playbook).
The classic example this emulates is the resort “channel” that’s the default setting when you first turn on your hotel-room TV. Streaming as a service takes this principle to the dentist offices and fast food dining ares of the world. To be fair, this existed to some degree with DOOH content networks.
To jump on this opportunity, streaming-as-a-service company Atmosphere closed a $100 million Series C funding round this week. The company streams ad-supported, license-free video in various SMB locales including 19,000 bars, restaurants and appointment-based (read: waiting room) offices.
Its business model is 100 percent ad-supported, so it’s driven to gain the widest audience possible. In other words, the service is free to business locations, including the display hardware. This eliminates a cost barrier for SMBs, but raises a key question: what’s the quality of the streaming experience?
To answer that question and sweeten the deal, Atmosphere focuses on branded content that has some production value or, again, infotainment. This includes sponsored mini-documentary-type content from the likes of Red Bull. Here, it faces quality control challenges common to any “advertorial” content.
The goal is also to get a critical mass of content depth so that it has contextually relevant options for a range of environments. It isn’t there yet but continues to sign deals that will widen its appeal. It also specializes in sound-free and short-form captioned content for wide applicability in SMB locations.
Meanwhile, 60 percent of locations are bars and restaurants, which will only grow as the world emerges from a pandemic. The other 40 percent is a mix of other verticals. Locations include Meineke Car Care, Burger King, and Texas Roadhouse. But the real opportunity could be the SMB long tail.
To further boost appeal to SMBs in terms of quality and breadth of content, Atmosphere has a few initiatives up its sleeve. For one, it’s working on a sponsored news format that delivers general-interest fare that happens to be sponsored. This will be a combination of produced and curated segments.
It also hopes to create customized channels with theme-relevant content for larger venues like sports arenas. Meanwhile, on the other end of the ad/publisher equation, it’s working with sports brands to have their own channels on its network. Those thematic matches will be the name of the game.
Meanwhile, Atmosphere has some momentum. It’s doubled its locations in the past year, indicating growth as the physical world returns. In total, it streams 250,000 hours daily to 20 million unique viewers. For the sponsored content it serves, it sees an average of 215,000 impressions per spot.
As for this week’s funding, Sageview Capital led the round, with participation from Valor Equity Partners and S3 Ventures. Bridge Bank also provided $20 million in debt as part of the round. Atmosphere isn’t disclosing it’s post-money valuation but TechCrunch reports its in the high hundreds of millions.