Portal launches an ad-free YouTube competitor that raised $4.2 million

Portal

• On Tuesday, an ad-free video-streaming platform called
  Portal was launched, competing with the likes of YouTube and
  Vimeo.
• On Portal, creators are paid directly by viewers who
  like what they watch — ideally meaning creators have to hustle
  less for views, and focus instead on building relationships
  with their audience. 
• Portal has raised $4.2 million in seed funding from
  investors including Dallas Mavericks owner Mark Cuban.
• Swerdlin decries the practice of “demonetization,” and
  says that allowing advertisers to dictate who is and isn’t
  allowed to make money from their videos is tantamount to
  censorship.

When Radiohead famously released
its
“In Rainbows” album in
2007 and told fans to “pay what you want,” Jonathan Swerdlin
forked over $50.

He was enamored by the radically
different approach to payments. But to his disappointment, the
model that helped Radiohead

instantaneously earn $3 million
upon the album’s release

never really caught on in the music
business.

Swerdlin — who started his career
in e-commerce, most recently helping grow a popular online
women’s underwear company called THINX
— couldn’t shake his fascination with Radiohead’s experiment or
ignore the rise of micropayments on gaming platforms and in
countries like China, where “tipping” for content from one’s
favorite blogger, live-streamer or musician

has become the
norm

.

On Tuesday, Swerdlin announced
the launch of Portal, an ad-free video-streaming platform where
creators are paid directly by viewers who like what they
watch. 

For his ad-free video platform,
which puts him in direct competition with the likes of YouTube
and Vimeo, Swerdlin, Portal’s co-founder and CEO, has raised $4.2
million in seed funding from investors including Dallas Mavericks
owner
Mark Cuban, of
“Shark Tank” fame. 

“For the content creator,
[Portal] gives them the ability to focus on value and investing
in delivering something that matters to people rather than trying
to churn something out every single day and game an algorithm,”
Swerdlin told Business Insider in a recent interview.

Getting paid with Portal

Portal’s key differentiator from
other video platforms,
Swerdlin told Business Insider in a recent
interview,
is how creators
are paid.

Similar
to 
Radiohead’s “pay
what you want” approach, Portal lets viewers “tip” creators for
the videos they watch. Enjoy the content you consume, and you can
leave a tip ranging from $0.10 all the way up to $100.

For multiple revenue streams, any
creator on Portal can also set up monthly subscriptions for their
channels, or enable a paywall for the individual videos they
post.
To make money on its
end, Portal takes a small percentage of the funds paid to
creators.

Swerdlin and his team — currently
comprised of five engineers and “a small community team” — hope
the shift away from an ad-based model (which compensates creators
according to the sheer number of views a video receives) will
increase the quality of content being produced.

Portal

Ad-free means freedom to create

Another major upside to an
ad-free model, Swerdlin explains, is that content creators don’t
have to feel the need to create “advertiser-friendly” content
designed not to offend deep-pocketed media buyers. 

“[Advertisers] should not be the
authority on what it is that we see or don’t see,” Swerdlin
explains. 
“That’s not
what the Internet was built for. That’s a fail right there. But
[advertising is] a multi-billion dollar business and because of
that, it continues on.”

Swerdlin also decries the
practice of “demonetization,”
where platforms like YouTube decide that some videos or channels
are unsuitable for advertisers, and revoke their share of the ad
revenue from that content.

While the idea is to tamp down on
offensive videos — infamous conspiracy theorist channel Infowars
was recently demonetized by YouTube — others have gotten caught
in the crossfire. LGBTQIA video creators, in particular, have

complained that they have been unfairly targeted by YouTube for
demonetization. He says that Portal has already attracted a
thriving community of LGBTQIA creators who felt jilted by its
larger rivals. 

“Demonetization is censorship,”
Swerdlin says. “When you take away [people’s] ability to earn
money then you take away their ability to create content. It
takes money and time and investment. You have to pay the
bills.”

Notable creators that have been
using Portal’s beta product for the past few months are social
media guru Gary Vaynerchuk and the online news show, The Young
Turks.

“The Young Turks has always
believed in the ‘audience first’ approach to content creation and
place great value on the direct relationship with our fans,” The
Young Turks’ Chief Business Officer Steven Oh said in a
statement. “We are excited to be on Portal to continue building
that direct-to-consumer relationship.”

A crazy idea takes shape

For
Swerdlin, the launch of Portal has been two
long years in the making.

“Everybody told me in the
beginning that I was crazy. A lot of people didn’t realize that
ads were a problem,”
Swerdlin remembers. “
It’s been really interesting and exciting for
everybody to sober up and wake up to the problem.”

Read
more:


The CEO of Vimeo landed the job at 34 — and she learned a huge
leadership lesson in her first 12 months at the top

As for the seemingly
insurmountable battle of taking on a competitor like YouTube,
which as of May had over
1.8 billion active users,
Swerdlin says he’s confident that Portal’s
micro-payments model will ultimately win out.

“People think like, ‘Oh, David
and Goliath,’ with platforms like Facebook and YouTube as the
Goliath,” Swerdlin says. “But if you compare the models
side-by-side and you look ten years from now, in ten years from
now, our model will be the Goliath.”