It’s no secret that most businesses in their growth-stages lose a lot of money. Most startups raise funds to combat a lack of revenue, some businesses take out loans, etc.
So it shouldn’t be too surprising that Hulu, who once had a cancelled IPO back in 2010, has since retooled and as of late started refocusing their growth. Owned in part by several major media companies, Hulu has a little less pressure on it than a publicly traded company at this time, allowing them to grow and establish their library of content as well as hone in a growth marketing strategy before any big moves.
Hulu is currently losing money, but is heavily front-loading its content library with expensive but desirable titles in order to grow their monthly subscription base, a very lucrative business model.
“It’s true that Hulu has and is going to continue to step up their investment in both acquiring and producing original programming and programming from others, and that will continue to increase their losses in the near term. We believe it’s going to create value over time, and we think there’s value in them strengthening their offering. And furthermore, the market is big enough for them and others to thrive. So we feel good about where they’re going strategically,” said Disney COO Thomas Staggs (Disney is one of Hulu’s major backers).
While most people subscribe to between 1-3 streaming services, it is still incredibly important to lay claim to marquee titles in order to appear to be the most robust content library. Hulu has certainly spared no expense in 2015 while purchasing rights to stream Seinfeld, hundreds of major movie titles as well as more creation of exclusive and original titles.