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Peerflix, Inc.

Product Name

Peerflix.com

Market Segment

Enabling technology

Funding

Series A was co-led by 3i and BV Capital.

Competitors

No direct competitors. Competitors in the DVD online rental category include Netflix and Blockbuster.

Product Description

Peerflix is a peer-to-peer online trading platform for physical goods or services. In its first application, Peerflix allows users to trade DVDs across a large, decentralized network, where each U.S. household serves as a distribution center. Peerflix carries no inventory and does not participate in the transaction: we simply optimize matches across people and products. We transfer our low overhead directly to customers by charging 99 cents for each trade we facilitate.

Market Opportunity

DEG reports 2004 DVD sales at 1.5 billion units or $15.5 billion (35% annual growth and 3X revenues from DVD rentals). As 75% of U.S. households own DVD players, this translates into 19 discs bought per household. Consumers are quickly accumulating viewed DVDs that can be traded on using Peerflix.

Demo Says

Peerflix is at DEMOfall for its technology and its innovative business model. The Peerflix trading application — which the company has proved with its DVD trading service —is supported on the back end by a unique arbitrage and commerce platform. By splitting the front end from the back and turning it over to the open source community, Peerflix will spur other interesting trading applications — applications that tie into the proprietary Peerflix engine, allowing the company to create a new line of services business without creating every trading site itself. The Peerflix model answers the “how does open source make money” question brilliantly.