Catching up with Peerflix

Journalists too often fall into the hit-and-run reporting trap, where we write about a start-up and then rarely, if ever, check back on its progress. So when the Peerflix guys invited us in for a chat last week – nearly a year after our first posting on them – we accepted.

Peerflix is the peer-to-peer DVD movie trading service in Menlo Park. Users create “want” and “have” lists online and then Peerflix looks for matches. Users mail each other the DVDs, and the recipients can then keep them as long as they want – they now own them. There are no monthly fees; trades cost a buck each.

When we last chatted with co-founder Billy McNair, the company had about 5,000 users, and there were plenty of skeptics to balance out McNair’s optimism.

Now, a year later, McNair says he has 150,000 registered users, and 250,00 DVDs have been added to the network. The 250,000 DVDs is an especially important number because without a large number and wide variety of movies to trade, users won’t find the service attractive, especially compared to a Netflix or Blockbuster. The company also took another $8 million in funding, as we reported here.

“The service has kind of exploded over the last 12 months,” McNair said. “What we’ve done in January has already matched what we did in Q4 of last year. So the adoption is starting to pick up to where we hoped.”

McNair has also beefed up his management team with refugees from Netflix and Amazon’s A9 search engine. Paul Gutierrez joins the start-up from Austrailia’s Homescreen Entertainment and Netflix, where he managed content acquisition. And Barnaby Dorfman comes from A9, where he was VP in charge of local search and helped develop the noteworthy BlockView effort.

McNair said the duo will help improve the user experience and build new community tools that help users interact with each other.

One of the downsides of peer-to-peer trading is that users are at the mercy of other users to fullfill their requests. Unlike Netflix, where you know the DVDs will ship within a day, Peerflix members might be less-reliable. Gutierrez will work on trying to optimize the trading process so that DVDs move from one member to another more quickly and efficiently, and so that users can better predict when their DVDs will arrive.

Dorfman, meanwhile, is a big film nut, it turns out . He worked at the Internet Movie Database, his father was a filmmaker, and he produced a film last year called Police Beat. “I’m really passionate about films and love to work in the space. And this concept of an efficient marketplace, where someone says, ‘I have one of these, I want to trade it,’ got me excited.” He’ll be VP of products.

“When we spoke initially a year ago, I had great ambitions for what this service was and could become,” McNair says. “But you always have that unknown. ‘OK, there are 3 or 4,000 people using this. And I think this is what will happen, and I think this the direction it’s going.’ But you never really know….Don’t me get wrong. There’s defintely an education process of bringing consumers up to speed on this notion of trading. It’s differnnt from a rent model or a buy model. But we’ve seen an explosion in the service over the last year and it definitely confirms that there is a demand for this.”