Pixellot, an AI-automated sports production and analytics solutions company, recently raised $161 million in venture capital. The largest investor was the Tel Aviv-based PSG growth capital fund.
PSG was attracted by Pixellot’s vision to accelerate the democratization of sports. “We see this solution as a revolutionary opportunity to bring any event to any sports fan in the world in a cost-effective way,” said PSG CEO Ronen Nir. The size of the potential target market (the company is currently active in 60 countries, in 17 different sports), the huge number of application possibilities of the technology and Pixellot’s category-leading position all played a role in PSG’s investment thesis. As is the company’s investor-friendly business model.”Since the majority of buyers come from media rights owners rather than end users, the company does not necessarily need to invest in consumer distribution and marketing of broadcasts,” said Nir. Historically, television networks have spent heavily on high-quality production of prominent professional leagues, according to JWS sports business newsletter . Less popular professional leagues and lower-level sports were largely limited to those in attendance, as the cost of recording, editing and broadcasting live video was prohibitive. Pixellot eliminates the need for expensive cameras and the time-consuming work typically associated with high-quality video production. Once the rights holder has installed the company’s hardware and software infrastructure, “the cost of producing a marginal sporting event is zero. This obviously creates a huge opportunity to bring sporting events (basically the 99.5 percent of sporting events in the world that are not produced today) to end users.” – stated Nir. Amateur sports are a significant part of Pixellot’s current business. Play-On (acquired by KKR earlier this year), the largest broadcaster of high school sports in the United States, is Pixellot’s largest customer. Practically wherever Play-On sells its solution, it practically also includes the content produced by Pixellot – said Alex Michael, co-head of the development company LionTree, which participated as a consultant in Pixellot’s capital raising. Pixellot found a niche in youth sports because its technology helps solve a primary parental directive. Many parents probably won’t be able to attend every single competition of their child. “But probably the most important thing for your kids is that you watch the game, and as a parent it’s probably one of the most important things for you,” Nir said. The company also established a foothold in the secondary sports market (just think of minor leagues, lower-level university athletics). These are areas that would traditionally “refuse to record matches and training sessions because it would be prohibitively expensive to cover them at a high level,” Michael believes. But now, with a solution like Pixellot, rights holders at every level can essentially get “the same type of coverage and video capture, distribution and analysis as the biggest and best professional leagues.” Recently, the late-stage startup started to move upwards. “More and more third-tier professional leagues and even the top teams for their practice fields are now using Pixellot’s systems for this recording and analysis,” says Michael. The company has high profile clients in La Liga, Serie A and Bundesliga. While clubs in the three leagues mentioned rely on Pixellot for coaching and training purposes (think video analysis), other rights holders use it to engage existing fans, attract new fans and generate revenue opportunities. Some offer broadcasts of matches or training sessions for a fee. “If the content provider wants to monetize (the video), of course they can,” Michael said. Money has flowed into the automated video technology business over the past 18 months. In addition to the aforementioned investments in Pixellot and PlayOn, Sportradar acquired Synergy Sports (which includes Keemotion) and Veo raised $80 million. Second Spectrum (acquired by Genius Sports), Hudl, TrackMan and GameChanger Media (acquired by Dicks) are also competing for video and data capture and analytics market share. Investors are optimistic about the space, recognizing that the technology needed for automated, high-quality live streaming has finally advanced enough to become commercially viable. Nir said the company produces 30 times as many hours of live sports content as ESPN each month. The pandemic has been an accelerating factor for AI-automated video and analytics providers. Pixellot reached important scale “on the basis of being able to offer a streaming video solution to all these high schools, especially when parents literally couldn’t go. While the restrictions due to the pandemic have been lifted, people’s desire to “sports all levels are consumed,” stated Michael, who added that the development of the area is also helped by the connection to sports betting. Pixellot plans to use the newly raised capital to develop technological capabilities, expand its geographic reach and add additional sports. They see dynamic growth potential in Asia and Latin America in particular.Hardware, software, tests, interesting and colorful news from the world of IT by clicking here!