U.K. student sells dotcom business for $1.25 million - Embedded.com

U.K. student sells dotcom business for $1.25 million

LONDON — A University of Bath student who developed a video streaming website two years before YouTube has sold his business for $1.25 million (£630,000).

Kieran O’Neill, aged 19 from Winchester, set up the HolyLemon.com, website in 2003, when he was taking his GCSEs, to show friends the Flash animations he created.

As word of the site began to spread, he started streaming user-generated funny video clips submitted to the site. Realising its potential as a business, O’Neill began marketing the site and drawing revenue from advertising sales – making it profitable since 2003, largely through deals with advertising networks.

HolyLemon.com soon had more than 50,000 users per day and became established as Google’s first-ranked website for the search term “funny videos”.

In March 2007, HolyLemon.com had more than 1.1 million unique visitors – 32 percent of whom were based inside Europe.

Over the last year, O’Neill has refused several offers for the business, including an approach from Brad Greenspan, one of the early investors in MySpace, and other U.S. companies keen to expand into the European market.

After spending three weeks at the company headquarters in San Francisco, O’Neill accepted an offer from Handheld Entertainment who impressed him with their vision for the company.

O’Neill now holds shares in the parent company and has a sizeable amount to invest in the two ventures he is currently working on.

“With exams, I haven’t really had time to celebrate yet,” said O’Neill – who is a second year BSc Business Administration student in the University’s School of Management.

“I designed the early sites in my bedroom at home and the trick was learning how to effectively stream user-generated video clips through the browser. It is what you see everywhere now, but then it was a really novel idea – particularly for humour websites.”

“At the time of its launch I remember seeing YouTube and thinking that it was good – this was back when my site was 10 times the size,” said O’Neill.

“YouTube’s success came through a widget that allowed people to distribute video content – but then they have had a team of developers and a lot of money to get it where it is today.”

It hasn’t all been plain sailing for O’Neill – who had to pay an out-of-court settlement to a major film company after a contributor to the site inadvertently claimed intellectual property rights for the film they submitted.

“It was a harsh lesson, but we came through it OK,” said O’Neill – who remains one of HolyLemon.com’s editors.

O’Neill’s current venture, an online magazine and community for gamers, PlayStation Universe, is part-financed by Gorilla Nation Media, a Los Angeles-based advertising sales company.

He has also recently put together a team to develop a new Web 2.0 social network which should launch later this year.

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