Behind the Scenes of a $40 Million Growth Loop
How VEED’s Tiny Watermark Became a $40 Million Growth Engine
Hi, it’s Andreas, and I’m back with Growth—my newsletter that breaks down how startups grow through weekly hacks, strategies, and case studies.
Today, we’re breaking down the funnel of VEED, one of the most successful video editing startups of the AI era. I came across it recently while searching for a way to create engaging videos, and its growth loop is what caught my attention.
So, let’s jump in.
Have you ever considered using video in your marketing?
Me too.
But I always struggled with how to edit videos to make them cool and engaging. When I last looked into this topic, I saw that there are now thousands of AI tools that can help.
However, VEED stood out. It’s probably one of the most successful ones: it started as a bare-bones video editor and now generates $40 million in revenue in 2024, up from $15 million in 2023.
So, I thought we could take a closer look at its growth mechanics.
VEED – From Side Project to Eight-Figure SaaS
SEO as a Key Pillar of Its Strategy
VEED started as a side project and relied heavily on SEO from the very beginning.
Today, it attracts about 11.7 million visits per month and is one of the world’s 20 most-visited design tools.
It all started simply, as the founder stated in a Reddit post six years ago.
So they started out with:
Posting on Quora → which was found through SEO and drove traffic
Building backlinks through an additional tool → which created trust in the VEED page and helped it rank better
If we dive into its traffic sources today, a Similarweb breakdown shows an unusually balanced traffic mix for a product-led SaaS:
Organic search delivers 52.94% of desktop sessions, thanks to thousands of highly targeted landing pages (e.g., “compress WebM,” “add subtitles to TikTok”).
Direct traffic contributes 35.33%, indicating that many people type “veed” directly into the URL bar after encountering the brand elsewhere.
Social channels round things out—most visibly a YouTube channel with 146,000 subscribers and over 41 million lifetime views, plus 21,700 followers on TikTok, where quick-fire demos double as advertisements.
This indicates that VEED has a strong brand—with over 35% direct traffic—and drives significant traffic through SEO and social media.
Smart here is that they build landingpages for every use case like “add subtitles to TikTok”
Two Minutes to the “Aha” Moment
But how is all that traffic converted? And how do users see the value?
The answer is ruthlessly simple—it takes no longer than two minutes to reach the “aha” moment.
💡 The “aha moment” is the point where a user first experiences the core value of a product—when they go from just trying it to truly understanding it. It's the switch that flips when someone says, “Ohhh… now I see why this is useful.”
It’s not always the first login or feature click; it’s the first moment of realized value.
Start for free, no card required.
Once new visitors land on the site, they can jump straight into the editor from any landing page and are greeted with calls to action like “Get started” and “Start for free.”
The added note—“No credit card required”—helps lower the barrier to entry and encourages users to try the product without commitment.
Once you log in, you land directly inside the tool.
You can upload your video and have plenty of options to optimize it, from auto-generating subtitles to removing noise and improving quality.
This makes beginners feel like pros in less than 120 seconds, which turns out to be the aha moment.
Watermark Loop: Free Advertising Baked into the Product
Once users want to download their video (on the free version), VEED’s product-led growth tactic comes into play.
Every video exported on the free plan is stamped with a discreet “VEED” badge that cannot be removed without a paid subscription.
As many users don’t pay for the tool, they use these clips with the watermark intact. Because creators post them across TikTok, Reels, Shorts, and LinkedIn, the watermark travels with the content.
Viewers who click—or simply remember the short domain—land on VEED, use the free editor, and, in turn, push more branded videos back into the wild. Direct traffic numbers confirm that this loop sustains itself at scale.
How VEED Makes Money
Huge traffic and smart product-led growth aren’t enough. What counts is revenue, and VEED uses multiple streams:
1. Subscriptions
2. Credits
For subscriptions, the cheapest paid tier—Lite, at roughly $9/month—removes the watermark and unlocks 1080p resolution.
Higher-tier plans offer 4K exports, brand kits, language translation, and eye-contact correction. Enterprise pricing includes even more features, which are typically needed by companies using the tool at scale (and it’s interesting that such a tool even offers enterprise packages).
Credits, on the other hand, are used for AI functionality—such as AI avatars—and follow a typical usage-based pricing model.
Loops That Keep Customers—and Bring in New Ones
VEED.io has over 12 million users per month and more than 100,000 paying users. It has grown from a small startup into a global, industry-leading platform by leveraging various growth mechanics.
One of these is the “Invite Your Friends” discount, which incentivizes users to refer others in exchange for benefits, helping to fuel viral growth and expand the user base organically.
Affiliate Program
The affiliate program has no limit. Participants receive a 25% commission on every successful referral for up to 12 months.
Final Words
VEED’s growth loop is a textbook example: long-tail SEO filled the top of the funnel; the watermark turned every user into a micro-advertiser; social video added reach; and AI features increased trial-to-paid conversions and average revenue per user.
VEED’s badge may occupy just a few pixels in the corner of a video, but it’s the engine behind its success.
If your product naturally produces shareability, your next growth breakthrough might be hiding in plain sight—right where your users click “Publish.”
Takeaways
Put your brand in the product itself. If users share what they create, find a subtle way to include your logo or name.
Show value before asking for money. Let people experience the “wow” moment quickly, and then they'll be more open to upgrading.
Stick with what works. Keep your best growth channels running, even as you try new ones.
Educate instead of advertising. Tutorials and webinars build trust better than pop-ups or ads.
Raise money to grow, not to survive. Being profitable gives you more choices and better deals when fundraising.
PS: If you enjoyed this case study, please tap the like button below. Thank you! 💛
love how VEED weaponised its watermark. textbook product-led growth.
Well written and great playbook