With election season coming to a close, it must be asked: What happened to those wacky JibJab guys?
Four years ago, JibJab Media Inc., a little-known animation studio in Los Angeles, helped define the presidential election with its hit parody video “This Land.” More than 80 million viewers watched the two-minute clip that featured caricatures of President Bush and Sen. John Kerry insult each other to the tune of “This Land Is Your Land.”
So why didn’t JibJab make a similar splash this year? Because what started as a shoestring viral satire operation has quietly transformed into a business specializing in short digital films and e-cards.
If that means JibJab has matured, don’t tell that to the company’s co-founders, brothers Evan and Gregg Spiridellis.
“We haven’t matured too much,” insisted Evan Spiridellis. As evidence, consider the container of Red Vines licorice on the conference room table and the oversized pirate puppets scattered around JibJab’s new offices in Venice. “We still have our sense of humor. But we are becoming a company. In 2004 it was me and Gregg working out of a warehouse. Now look around, we’ve got overhead.”
It also has competition. Over the past several years the digital content production field has become cluttered with comedic Web sites such as FunnyorDie.com, an L.A.-based startup backed by comedian Will Farrell and Sequoia Capital.
Many of these sites are struggling to draw an audience and find profitable business models, analysts said. JibJab has settled on a subscription service model, charging $13.99 a year or $4.99 monthly to send greetings to friends from the company’s library of e-cards.
Whether that will be successful remains to be seen. A private company, JibJab declined to release revenue or subscriber numbers. Evan Spiridellis said it was profitable from 1999 to 2005. At that point, the company started beefing up operations and hiring; it hopes to return to profitability next year.
JibJab’s challenge, analysts said, is to stand out from a packed field that includes traditional e-card behemoths such as Hallmark Cards Inc. and American Greetings Corp., as well as Internet companies including L.A.-based Evite.com, which has over 18 million registered users.
But because JibJab is still struggling to make money in the e-card game four years after the breakout success of “This Land,” some in the local tech community are skeptical about the company’s potential.
“They had one hit and now they’re struggling to find their way in a sea of companies doing the same thing,” said Bob Foster, a professor of technology management and entrepreneurship at the UCLA Anderson School of Management.
Evan Spiridellis, 34, said he and Gregg, 37, are aware of the expectations with which the success of “This Land” saddled them. He contends that JibJab’s content sets it apart. After all, Hallmark doesn’t offer many e-cards with dancing businessmen or prancing zombies.
“Look at Hallmark or American Greeting,” he said. “These cheesy, terrible e-cards are generating a lot of revenue, and we do the exact same thing only we do it better.”
Fame, not money
In 2004, JibJab was a two-employee company. There are 37 employees today, and it’s backed with several million dollars in funding by Polaris Venture Partners in Massachusetts.
The growth came from the decision to adopt a subscription model, which was the result of the brothers’ frustration with living from hit video to hit video.
“This Land,” for instance, netted JibJab hundreds of millions of mentions in the media, but only enough revenue to keep the company alive for another year at most.
“We want to stop reinventing the wheel every month,” Evan Spiridellis said. “We were getting top-viewed videos on YouTube, but where was the business?”
They didn’t abandon the political spoofs. After the 2004 election, they had a hit with a parody about big-box store shopping. This year, they released a musical satire of the McCain-Obama contest, but it didn’t draw the attention that their Bush-Kerry song did.
But rather than market videos based on seminal events like a presidential election the brothers decided to market them based on smaller events that happen more often like birthdays.
That was the start of JibJab’s “Starring You” e-cards, in which users paste photos of themselves, friends and family into JibJab videos and share them online.
Recently, JibJab also started selling “Starring You” merchandise, including coffee mugs, greeting cards and mouse pads.
As much as JibJab has grown since 2004, it also has had difficulty stepping out from the shadow of “This Land.” For better or worse, the four-year-old video made the company’s reputation, said Mark Suster of L.A.-based GRP Partners.
“The thing that’s clear to me about JibJab is they’re one of the few who have established a very solid brand,” Suster said. “Even to the point where when you see a cut-out talking head, you think JibJab. That’s very hard to do.”
Evan Spiridellis said the company wants to be known for more than singing and dancing presidential candidates. Despite the video’s role in making the company famous, he’d like to put “This Land” behind him.
“‘This Land’ was great, it was wonderful,” he said. “And now, it’s a relic.”
