Crowdsourced animation studio Crevo turns profitable after one year, scores $836k seed funding

The Crevo team – CEO Kensuke Shibata is at the bottom left.

We first spotted Crevo last March when the video animation crowdsourcing platform launched in Japan. The service has had a busy year – seeing solid growth in a number of key metrics and finishing in the black. Crevo announced today that the hard work has culminated in a JPY 100 million (US$836,000) seed round. CyberAgent Ventures and B Dash fund contributed funds. (Disclosure: East Ventures has previously invested in Crevo and is an investor in Tech in Asia. For more, please see our Statement of Ethics)

Crevo’s clients are fellow companies looking to create advertising or promotional videos with animation. Distinguishing it from similar services like 500videos which has a host of customizable animation templates, Crevo only supplies original video animations.

Starting from scratch with 200 video animators, Crevo has increased its freelancer ranks to 800. 70 percent of them are based outside of Japan, up from 50 percent last year. Some key freelancer markets for the company are Italy, Spain, Venezuela, England, and Vietnam. “Compared to Japanese [freelancers], the human resource cost is cheaper overseas, even in Europe,” co-founder and CEO Kensuke Shibata tells Tech in Asia.

According to Shibata, the reason is that freelancers in Japan tend to be hired on the basis that they can handle all aspects of animated video’s production. Crevo’s approach, however, is to hire freelancers just for specific segments of production – storyboard, character design, animation, narration, and background music.

Though some freelancers came over from sister service DesignClue, Crevo’s initial recruiting push took place at communities for video websites like Vimeo. Though the company still recruits, many of the freelancers at Crevo’s disposal came to the startup via friend referrals, meaning Crevo is proving to be a hit with its extended working force.

Painting a picture for clients

Clients are happy too. So far Crevo has helped fellow startups Retty, Wantedly, and Gamba, while also nabbing major clients like Rakuten, Lifenet, GMO, and Sumitomo Realty. The biggest client of the year, the one that Shibata calls a turning point in the company, was Hulu.

Fresh off its sale to Nippon TV, Hulu Japan needed to execute a strong marketing push. It chose Crevo to create nationwide commercials to air during August, a month with one of Japan’s few week-long national holidays.

Crevo made JPY 100 million (US$836,000) in revenue last year, but Shibata feels like they left money on the table. Insufficient staff meant that numerous work orders had to be declined. With the new funding, he plans to add 20 more members to the current team of 12.

He also expects to improve the service he provides to clients. Soon the company will unveil a new tool to collect detailed data on how the videos perform. Then, Crevo will be able to more strategically advise clients on how to improve their conversion rate. All told, Shibata expects revenue to quadruple to JPY 400 million (US$3.3 million) in the coming year.

Crevo’s overseas debut is also coming, eventually. Coy on whether or not he would expand outside of Japan this year or next year, Shibata identifies Taiwan and Thailand as possibly strong market opportunities in Asia. The US also looms as an appealing target.

For now, he is happy to reflect on the teamwork that brought the startup this far. “[We] didn’t have people or resources or money. We were the first player in this field. It was starting from zero. The team really gave it their all and we were able to give good value to our customers even though we had limited means,” he says.