Detour Proved the Right Track

CHICAGO, IL—March, 2008

Liquidus refocused on untapped niche, video-on-demand advertising, and became a leader

By Ann Meyer | Special to the Chicago Tribune March 24, 2008

A detour into video-on-demand ads has turned into the fast lane for Liquidus, a Chicago-based company.

Todd Holmes and two partners launched Liquidus in 2001 as a Web development firm catering to the liquor industry, but it expanded three years later into video-on-demand advertising for giant Comcast Corp., said Holmes, the company's chief executive who previously founded Beer Across America.

By creating a cost-efficient video publishing platform, the company has produced more than 1 million videos, which primarily advertise cars and real estate for local markets, he said.

By refocusing on the untapped niche, the company has positioned itself as a leader in the video-on-demand space, serving a variety of customers in several segments, Holmes said. The company's annual revenue hit $4.15 million in 2007, up from $2.28 million in 2006, Holmes said. The company is predicting sales of $11 million this year and is on target to break even, as it expands its customer base and product line.

Liquidus' growth is just the latest example of an entrepreneurial company that is creating new, improved Internet-based products to tap ever-changing needs, experts said.

"The Internet is perhaps the most powerful communications media that humans have come up with so far," said Steve Miller, principal at Origin Ventures, a Northbrook-based venture capital firm with a focus on Internet-related businesses. "Entrepreneurs are constantly finding new and effective ways of leveraging the medium to find a market, build companies and make money for investors."

Liquidus' rapid growth stems from its decision to turn away from standard Web site development and embrace a new opportunity in the marketplace, Holmes said. The company's core platform, SpotSense, makes it easy for customers to create, manage and distribute local video-on-demand ads using their own digital content and Liquidus' Web-based interface.

"It changed the business pretty dramatically," Holmes said. "We went from servicing multiple clients to being a marketing and sales company for a single product, which is our product. It's a different mind-set."

Liquidus turned away some clients to focus on the video-on-demand opportunity. "We, as a management team, had to just cut it and cut it clean," Holmes said.

Now as more companies look to add videos to their Web sites, Liquidus is returning to its Web development roots, this time bringing its video platforms to the Internet in a new Videolink product that makes it easy for customers to create and distribute Flash videos online.

"We leveraged our competency in Web development and marketing to be able to provide the new product," said Chris Carlton, co-founder and executive vice president of creative services. "It helped us excel in the marketplace."

Liquidus' detour from its original Web development path isn't unusual, but its degree of success might be, experts said. Entrepreneurs often get sidetracked from their existing business when a new idea emerges. Whether to pursue the new opportunity depends partly on what's driving it.

"If you've got a customer that's waving money and nobody else is doing this, then it's a much better reason to consider making a significant change to the business model" than doing it on a hunch, Miller said. Even then, "it's not a no-brainer decision."

Entrepreneurs should consult with advisers and carefully consider the risk to the existing business, Miller said. "It's very common that entrepreneurs pursue different paths, but they may do it too quickly without letting the original business plan work through as they should," he said.

About Liquidus

Liquidus has revolutionized the way companies are advertising on web, mobile and Video On Demand TV. Through a proprietary platform, Liquidus works with clients to create large volumes of video advertisements using existing static collateral. The result is high production quality, affordable interactive video advertisements for multiple media outlets that capture consumer's attention.

Contact

Contact: Kirk Davis
Phone Number: (312) 589-6102
Email: pressinquiries@liquidusmedia.com

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