The big round and the valuation counters the current popular wisdom that tech startups are going to have a difficult time raising in the current environment unless they're already running solid businesses. Apparently, Giphy is popular enough and has enough revenue potential that it was able to find investors.
Giphy started as a searchable trove of GIFs that are free to use, but its key move was to open its giant repository for GIFs to integration with popular apps.
The popular inter-office instant messaging client Slack, for instance, allows its users to type "/giphy" and any word they can think of. That word is then sent to Giphy, who finds a GIF with that tag and posts it. The process is seamless, and after a few uses becomes second nature, meaning when people think of GIFs, they often think of Giphy.
Businesses have also found a use for Giphy through "Live-GIFing", turning a few seconds of their recently published videos into highly sharable GIFs. The service is so popular an entire section of the staff is dedicated to "Live-GIFing."
Future revenue streams could come from selling ads alongside relevant GIFs, or by letting GIF creators integrate their mini moving pictures with popular franchises, including Star Wars, Zoolander, and the X-Files.