Alibaba Invests $50 Million in TV Remote App Peel
Alibaba, the Chinese tech giant, continues to place financial bets outside of its core e-commerce focus, investing $50 million into entertainment app maker Peel. — The Mountain View, Calif.-based startup makes apps for smartphones …
Context & Ripple Effects
The $50 million check to Peel is the latest move inside an arc that began drawing attention this summer: as the New York Times reported in August, Alibaba has been placing large bets across an array of U.S. tech companies well outside its e-commerce core. The pattern already includes July's $120 million investment in mobile gaming company Kabam at a valuation above $1 billion.
Peel itself is a small, established player by comparison — the Mountain View startup had raised a $16.7 million Series B back in 2011 around its ambition to turn iOS devices into a universal remote for televisions. That Alibaba would fund it says more about the investor's entertainment ambitions than about Peel's scale; the story also traveled unusually widely for a mid-size round, with same-day pickups at TechCrunch, Gigaom, VentureBeat, and Tech in Asia.
First-order effects
- Peel gains a strategic backer with deep pockets and China-market reach, transforming it from a venture-funded app maker into part of Alibaba's expanding U.S. entertainment portfolio.
- Alibaba extends a confirmed string of non-e-commerce investments — Kabam in gaming in July, Peel in second-screen/TV apps now — each targeting a different slice of the living room and mobile entertainment stack.
Second-order effects
- Rivals building TV companion and discovery apps face a competitor newly capitalized by one of China's largest internet companies, raising the stakes for their own fundraising or exit timelines.
- For other Chinese tech giants watching Alibaba's U.S. spending spree, the deal lowers the perceived risk of similar minority-stake investments in American consumer startups.
Third-order effects
- If the pattern holds, capital from Chinese internet platforms becomes a structural funding layer for U.S. consumer-tech startups that Western VCs might underweight — with content-distribution rights and market access, not just cash, as the currency of these deals.
The trend: Chinese internet giants are assembling U.S. consumer-entertainment portfolios through minority stakes, with Alibaba's cadence of deals through 2014 setting the template.