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Beliefnet Secures $7M In Series C Funding For Growth, More Multimedia
By Rachel Nielsen
Dow Jones
7/1/2005
New York -- Beliefnet Inc., a religion-and-spirituality Web site that offers free columns, email newsletters, online scriptures and other materials, has raised $7 million in Series C funding.
The round was led by Softbank Capital, a first-time investor in the company that provided $6.5 million of the new funding. The remaining $500,000 was provided by existing investor Blue Chip Venture Co., said Steven Waldman, Beliefnet's chief executive.
The round, which closed June 10, will be used in part to widen the company's revenue base. Waldman said he wants to increase the traffic on the company's Web site and to grow the site's "reach" or popularity. The plan is for Beliefnet to "be big enough to attract a whole different league of advertisers" for the Web site, meaning larger ones.
The site, Beliefnet.com, already is running online ads from national companies such as Pfizer Inc. and Walt Disney Co. "Half of our advertising revenue comes from non-religious companies," according to Waldman. (Beliefnet says on its Web site that its editorial decisions aren't dictated by advertisers.)
The Series C also will go towards making Beliefnet.com more interactive, with more audio, video and broadband services added to the site, said Waldman. Beliefnet is mostly text-based today, but "for a lot of people, spirituality is an auditory experience," he said.
The company also will hire more staff. It has about 33 full-time employees now and expects to have about 40 by year-end. The bulk of the Series C-funded hiring will be done in 2006, said Waldman.
The company was founded in 1999 and had raised roughly $24 million in funding up to April 2000, when it entered Chapter 11 bankruptcy protection. Waldman, a Beliefnet co-founder who was editor-in-chief but not CEO at the time, said the company had been "groping for the right business model." It tried out an e-commerce model, but ended up settling on its current advertising concept.
Beliefnet exited Chapter 11 in October 2002 as a profitable company, and Waldman became chief executive at that time.
It then raised about $1 million in Series A and Series B funding, and the Series C, bringing total funding to about $8 million.
Waldman said there is "enormous public interest in spirituality and faith," a reflection of the high rates of religious affiliation or interest among Americans and their increasing use of the Internet.
Beliefnet offers a range of free products for various interests, ranging from Christians to yoga enthusiasts to Muslims. For Buddhists, for example, it has commentary from Buddhist perspectives, audio clips of the Dalai Lama, and a daily email newsletter.
At the same time, "the site's traffic patterns more or less mirror the [U.S.] population as a whole," with roughly 70% of the site's traffic related to Christian interests. About 70% of the site's visitors are women, and they tend to be in the age range of 35 to 45 years old.
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