BitTorrent, seeded, now waits for VC funds

Ashwin Navin has the self satisfied look of a cat that just licked a pint of cream. His eyes gleam, when he talks about BitTorrent, where he has a lofty title of chief operating officer. Navin, an investment banker-turned-Yahooligan doesn’t need a jolt of Starbucks double shot, when exulting about the future of his little start-up. In the ephemral world of digital content, Bit Torrent is as close to a sure thing, you can get.

All he has to do is mention Bram Cohen and Bit Torrent. In the ever mutating peer-to-peer networking universe, Cohen is like New York Yankees’ short stop, Derek Jeter. In less than two years, their client software which allows users to share big files such as video clips with remarkable ease through smart technology, has been downloaded nearly 45 million times. That’s about 100 million less than claims by Skype folks, but its only getting started. In less than a year, Bit Torrent has gone from being an illegal file sharing network to being the network that is being used to distribute legal content. “We are now in a position to promote free, or paid content,” says Navin. And that explains why MPAA and RIAA are both responding nicely to Bit Torrent’s overtures.

The Bit Torrent search engine, and soon a torrent directory service will bring the company one step closer to becoming an even more legitimate part of the broadband world. Navin explained that distributing video games, short video clips, ancillary audio information and software are key areas of focus for the company. Blizzard, Linspire and a slew of other companies have used Bit Torrent for content distribution over the Internet in recent past. [ If I am C/Net’s, I need to be worried, for Bit Torrent can quite easily replace their digital download directory. (Yahoo, how about stepping in, and buying this before it gets too expensive?)]

For now thanks to advertising dollars, donations from users and other projects, the company has enough to pay the bills, keep seven employees well fed, and hire another 13 by end of the year. How about more venture capital? I have heard rumors that Doll Capital might have invested in Bit Torrent. Navin says the company hasn’t taken any VC money thus far. “But we are opportunistic,” he says. Not that opportunity is not knocking on their door. A recent San Jose Mercury News article resulted in over a dozen VCs reaching out to the company. Bit Torrent could be one of those start-ups, that VCs can go nuts about.

Think about it. In today’s Silicon Valley, there is so much cash sloshing around, that some of the smartest money managers on the planet, the guys who have turned more pennies into dollars than I can even dream off, aka Sequoia Capital and Kleiner Perkins, are ready to pump in $8.5 million into a promise of an aging hipster’s ability to turn podcasting into a mega-business. Or that, another equally pennywise bunch is ready to invest a few million more, in another Podcasting start-up, Odeo.

If those companies can snag millions, then Bit Torrent is definitely worth a lot more. Let me put it in the old world terms. The podcast start-ups of today are like, while Bit Torrent is Cisco of the digital content revolution. It has actual technology that will help grow the open media. It has the technology that will help distribute the “video content” next generation bloggers will create or whatever. It is infrastructure – and we know who makes all the money. That explains the cat who licked the cream smile on Navin’s face.