Santa Monica-based digital entertainment studio DECA, has officially launched, while announcing the $5 million venture round from the Mayfield Fund, General Catalyst Partners and Niklas Zennstrom’s Atomico Investments, that was reported earlier this month. In an interview with NewTeeVee, DECA CEO Michael Wayne made clear that the company isn’t just a digital production company, but consider itself an actual studio in the Hollywood sense of the word. As such, the company will discover, invest in and promote promising online video content.

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Since the studio model hasn’t emerged for online video, DECA believes it has a void to fill. The question is whether studio economics applies in the online world, which offers low production costs and ready-made distribution platforms. The studio system is also based on the idea that a few large money makers will make up for the majority of projects that are expected to lose money—the antithesis of long tail-driven models that have emerged online. Either way, it’s an interesting experiment, particularly coming at a time of escalating tensions between new and old models. Release.

Rafat adds: A small disclaimer: The company is on the same floor as our offices in Santa Monica, and we’re good friends with them now.