Together with Giorgio Tacchia (CHILI Founder and CEO) we went through the company history’s milestones: “CHILI was born in June 2012, thanks to my and Stefano Parisi’s entrepreneurial insight. Since the very beginning, the strategic plan was to operate in a transactional environment (tvod). In a context where pay TV, emerging svod operators such as Netflix, Amazon Prime and – to switch to Italy – Tim Vision, Infinity and Now Tv, were growing faster, we assessed that in Italy there was enough space to become a major player in the transactional video on demand field. In this business area there are two global players such as Apple’s iTunes and Google’s Google Play. Neither of these services is the core business of the companies. The most relevant global player, however, unfortunately remains piracy. This means that there is a very high demand for content that is not being met by the legal supply.”
How did CHILI answer this question?
We tried to focus on innovation and technology and the path has been quite clear. Since2012, we have invested a lot in tech, hiring about 50 engineers; we have focused on the skills and technical peculiarities of these professionals who are implementing our platform, which, let me tell you, has nothing to envy from the best-known ones worldwide.
What kind of development guidelines did you follow?
From the starting point to the present, we have moved along three strategic lines. The first is purely technological. The second line is commercial and has its core in distribution agreements with most OEMs (original equipment manufacturers, ed.) to secure devices and hardware sold on the shelf. But we have also signed many content distribution agreements, so much so that we can count on a very wide library. The third line has been development in international markets; our services are available in Britain, Germany, Poland and Austria. We focused, then, on differentiation. In this case, the development took place step by step and turned us into the first entertainment marketplace, very much related to the movie market. And that is the reason why the U.S. majors invested in our capital.
What, as of today, is the corporate composition of CHILI?
As I emphasized at the beginning, the company is conceived as an investment by myself and Stefano Parisi. From the beginning, we involved an Italian private equity fund, Antares. Since then, we have been followed by Italian family offices, or service companies that manage the assets of specific families and take care of their investments, which, although they have consolidated experience in other sectors, decided to bet on our idea. Warner, Sony, Viacom, Paramount and Fox subsequently entered the capital stock; most recently, Lavazza family also invested.
How are the shares divided?
Thirty percent is managed by the founding partners in a vehicle called Brace. Fifteen percent is divided, more or less equally, among the majors. A percentage close to 30 percent belongs to Lavazza, and the rest is distributed among family offices. The company, however, as far as governance is concerned, is firmly in the hands of the founding partners who planned its development and strategic direction. We have come to have 1.6 million customers registered to our service, with growth that is between 50-100 thousand new users per month. Our revenues are doubling year on year; we went from about 7 million in 2016, to 13 million in 2017. Results possibi- li also because we have invested a lot, like all companies that focus on technological innovation.
How are you articulating your business model?
To answer that, let’s try to ask: what is the consumer is looking for? He wants the content as soon as possible, in a friendly, cheap and possibly quality way. Piracy is an all too common habit in Italy, but when faced with a legal and quality offer, 80 percent of illegal downloaders say they are willing to spend in order to access certain content. This is affirmed by all major research. The point is that this content must be available and affordable.
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