Letter to Shareholders

May 5, 2020

 

Friends of VidAngel,

VidAngel exists to help you make entertainment good for your home. 

What is good for each of our homes is a personal choice. We’ve long known the motto “Be our guest.” At VidAngel, we believe “We’re your guest.” 

After all, it’s your home.

You choose how to watch. In 2013, we started developing software that was essentially a pre-programmed streaming remote. We have now gone through 6 successive attempts to build your skipping software. In each iteration, we hit a wall. We were sued over iteration number four, struggled through bankruptcy, and today Disney continues to oppose iteration number 6. We’re continuing to push through that for you, and in the meantime, we’re providing access to arguably the most exciting content of the COVID-19 era, produced by Netflix, Amazon and other streaming services. Watch however the BLEEP you want.

You choose what we make. In 2017, armed with the data around the skip choices families are making, we launched Dry Bar Comedy. Over 300 comedians have now performed, fine-tuning their sets to the audience and receiving  bonuses for better serving you. Additionally, with the help of 19,000 of you, we funded, produced, and distributed the award-winning dramatic series The Chosen

And you have responded. In April 2020, our business generated 5X the revenue of our skipping software pre-injunction. Dry Bar has over 2 billion views. The Chosen is offered globally, in dozens of languages, has tens of millions of views, and millions of dollars in revenue via its own app. It has been the #1 series on VidAngel for months. 

We hear you. 

Five. Times. Revenue.

 

So what’s next?

After emerging from bankruptcy (we hope during the June 18, 2020 confirmation hearing), we plan to raise up to $50 million to grow VidAngel. 

Our goal with these funds will be:

  1. Give our loyal investors, without whom we would not exist today, a chance to liquidate some of their shares (some people may need cash due to COVID-19 and won’t be able to wait for a potentially larger return). 
  2. Back many more creator projects, like The Chosen and Dry Bar Comedy, by building creator tools for:
    • – daily financial reporting and monthly payments (currently quarterly)
    • – better audience interaction (e.g. live streams, merchandise, uploads, notifications)
    • – creator cross-promotion (i.e. a simple way for The Chosen and Dry Bar to promote new creators’ projects with their massive audiences)
  3. Build better control over more content, allowing you, for example, to:
    • – find the very best content to watch or the best future content to back (rather than the primary focus being on skipping objectionable content)
    • – say exactly what kids are allowed to browse (specific list of approved titles with pre-set skips)
    • – watch with skips without having to wait for us to tag it (say hello to SkipBot and community made skips)

Thank you for trusting VidAngel as a guest in your home. We aim to build an entertainment company that centers around your kingdom, not ours. The best days are yet ahead.

 

Onward,

Neal Harmon

Co-founder and CEO

 

Click here for VidAngel’s SEC Reports

44 thoughts on “Letter to Shareholders

      1. We’d love to be able to watch on our Roku without having to “cast” from our phone. Loved how the app used to allow us to do that. Please consider returning this feature to your app. Thanks for what you guys do!

          1. Just seconding (thirding?) what Vince and Spencer said: we’ll really miss the standalone Roku app if that’s no longer available. We’ve enjoyed watching that way for years now.

        1. We can’t get VidAngel on our Roku anymore. When we search for it, nothing comes up. What happened? Please make VidAngel more user friendly!!!

          1. We’re working furiously to make it more user friendly. Sorry for your trouble. The current process is to download the VidAngel app on iOS or Android. Then use the “Send to TV” feature to cast it to your Roku.

  1. We’ve learned a few things during the Covid-19 pandemic: 1) patience 2) not to worry too much about what is different (or no longer available) but what good IS available and finally 3) much good is yet to come (such as The Chosen Season Two). Thank you for all the good you offer.

    Susan Sharp

    1. The price of the shares will be outlined in the offering statement.

      You have not lost your shares in the bankruptcy.

  2. Can you explain what the 6th iteration is? I think this is the DVR model. Or can you point me towards whatever court filing in which I can read about it? Thanks!

    1. Here is the trustee’s motion:
      http://blog.vidangel.com/wp-content/uploads/2020/05/dvr-model.pdf

      The studio’s opposition:
      http://blog.vidangel.com/wp-content/uploads/2020/05/studios-objection-dvr.pdf

      The trustee’s reply:
      http://blog.vidangel.com/wp-content/uploads/2020/05/reply-dvr-model.pdf

      Judge’s order (studios withdrew their motion while reserving their rights; that is to be able to oppose it later):
      http://blog.vidangel.com/wp-content/uploads/2020/05/dvr-model-order.pdf

      There’s a lot of stuff in the bankruptcy filings and it’s hard to keep up with it all.

      1. Thanks for the reply, Neal. Interesting reads, all three of them. It looks like you got a tentative green light on the DVR model. Do you have a timeline for rolling that out?

      2. And a second question – I’m a bit confused as to how the DVR model works. It says “the software allows the customer to mark potentially objectionable content, using his or her recording as a basis for determining potential content time codes to be filtered out for customers viewing their own DVR copy of that video. The customer’s marks then can be shard with others to use as well, benefiting all who want to filter.”

        Does that mean the filters are essentially being crowdsourced? Or does it mean VidAngel will continue to provide filters but customers can make their own for one’s VidAngel hasn’t done?

  3. Two things we need to use the service more. Surround sound support and subtitles. Because surround sound isn’t available, audio is not as .clear as it could be. My wife has trouble picking up what’s being said. We normally watch all our content with subtitles.

    Also, a nice to have would be to support 4K HDR for those shows that support it on their services.

    1. I’ve been working on the subtitle project personally. It’s very important to me to get it out on the service. It is coming.

  4. When will amazon work again without casting it from phone? I have been with you for a long time but without you restoring this we will likely end using your service. We cannot cast it from our phone.

    1. MF, we don’t have an ETA for a new Amazon app. Some have had success, though, restarting their Fire TV and then casting.

  5. Hi,

    I only recently became aware of your service through a PluggedIn article about The Chosen (which is great). The Roku interface is definitely non-standard, but after reading about your company’s legal issues, I understand it may be a necessary work around. I haven’t streamed anything other than The Chosen yet, but the picture (4K TV) and audio (out of my Sonos 5.1) quality are at least as good as HD YouTube. I am so tired of my family being ambushed by content, and this technology is a welcome addition to our streaming household. I don’t know how I’m so late to the party, but how can I help get the word out and make sure you guys succeed?

    Thanks,
    AG

  6. I am very excited for watching without having to wait for VidAngel to tag a skip, and for selecting exactly what titles my children are allowed to browse with pre-set skips.

  7. Are there plans for making this to work through a standalone CBS Access or HBO Max account? Not everyone wants to go through Amazon and moreover, not everyone has Amazon.

    I’m thinking about getting Vid Angel, but it needs to work with the major stand alone services ( Netflix, Hulu, Amazon, CBS Access, HBO Max, Peacock, and Disney+).

    1. Yes, there are plans to add additional stand-alone services (Disney and Warner Bros. – Time Warner owns HBO – sued VidAngel so we don’t have plans of offering their stuff)

      1. Any hope that Disney (as well as the other studio’s) content will be offered after the legal stuff comes to an end?

      2. How was the decision reached that you can’t filter HBO content? My understanding is that HBO is owned by WarnerMedia, which is owned by AT&T, and thus would have no ownership by or affiliation with Disney.

        It would be great if you offered filtering on the debuting HBOMax service!

  8. I don’t know if it will help you guys at all but just in case you don’t know about this, Vudu is now providing filtered content through what they are calling “Family Play” and it even works on Disney (Marvel) movies. I don’t like their product because there is almost no control of what gets filtered and what doesn’t. VidAngel is far superior but the fact that they are doing this on Disney movies was shocking to me since they have been giving VidAngel such a hard time for all these years.

    1. I was wondering the same thing and I feel the same way. VidAngel has done a far superior job. It gives much better control and I like to know what it is that I am skipping over. Maybe something they think is objectionable is fine to me, and vice versa.

      Is VidAngel going to get in on this action? Is Vudu being sued for doing this?

      1. That is a great question Cameron! If Vudu is not being sued, surely that would have to give the courts pause when reviewing the suit against VidAngel. That would certainly make me wonder what Disney’s real motivation behind the suit is.

  9. God bless you Neal Harmon, and Vid Angel! I’m praying for your success and God’s protection over you in these legal battles!!! 🙏🏼🙏🏼🙏🏼

  10. I have just started looking into VidAngel after searching for something to skip the bad parts of shows. I’m so thankful for all the hard work and effort you’re willing to go through in order to give families safe entertainment. It is certainly a worthy battle, and our family appreciates you! We absolutely loved the Chosen App and can’t wait for more! We have had some of the best conversations with our middle school kids after viewing Chosen together as a family! Priceless!

  11. As an early adopter of Vidangel and one who has experienced all it’s different iterations, I look forward to the ongoing evolution of the service. It will be interesting to experience the details of the next phase of Vidangel’s journey. I sincerely hope that Vidangel can keep pace with the technology available to viewers today as well as into the future. While Vidangel has always been far superior to the competition in the area of editing, however it lags significantly in the Audio/Video aspect. The inability to pass through 4K/HDR and Dolby Surround and now Dolby Atmos is quite conspicuous by it’s absence. I understand that captioning is coming; which will be a blessing to many. Nevertheless, Vidangel must keep up with the technology available or it will face the loss of a percentage of it’s customer base to those that do. I am excited for the possibilities the future holds for Vidangel.

    1. We’re very capable of implementing such technology (4K/HDR and Dolby) but the studios lawsuit has prevented us from being able to offer customers certain experiences. We hope we can overturn their rulings and provide customers what they truly need.

    1. Thank you for the incredible support. We’ll let you know as soon as the offering statement is available! Stand by.

      1. Thanks. Our address is changed and we’re not sure how to contact shareholder services. Please advise.

  12. I invested, a small amount, but 20% of my monthly income, in supporting VidAngel and the project The Chosen. Because I was in a coma and then had to re-learn everything, I just discovered your bankruptcy. I don’t plan to ask for my investment back, however is there a summarized and simplified version that outlines 1-Why the lawsuit. 2-Why are streaming services blocking the use. (If VUDU is allowed, it’s because the have .are agreements with HULU, Netflix, Disney, etc. and wish to monopolize the market. The Sherman Act was constituted to stop this practice, i.e. fixed pricing, market conglomerates not allowing competition, etc. Think the American Bell Company. Judge Green forced Bell to break apart and allow better competition. That is how we have Bell South, AT&T, etc.

    Last I using a monetary amount of 100. How much would 100 shares be approximately worth on June 2020.

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