StrictlyVC: February 7, 2014

110611_2084620_176987_imageHappy Friday, everyone. Get some rest this weekend and we’ll see you next week!


Top News in the A.M.

Apple has bought $14 billion of its own shares over the last two weeks, reports the WSJ, which published an interview with Apple CEO Tim Cook last night. Said Cook of the company’s business going forward: “There will be new categories. We’re not ready to talk about it, but we’re working on some really great stuff.” Pressed for details, Cook added that anyone “reasonable” would consider what Apple is working on as new categories.


Kleiner Perkins’ Trae Vassallo Reboots

Trae Vassallo’s early investment in Nest Labs, maker of Internet-connected devices like thermostats and smoke alarms, has placed her in the ranks of today’s top venture capitalists. But Vassallo, along with a handful of other longtime Kleiner Perkins general partners, was recently cut from the firm’s investment committee in a sweeping reorganization first reported by Fortune.

Perhaps it’s no surprise that sources say Vassallo is planning her next move – though she refuses to comment. She also seems ready to shed her reputation for green tech deal-making and to embrace her passion for Internet-connected devices for both consumers and enterprises.

During a visit yesterday afternoon to Kleiner’s Sand Hill Road offices, I chatted with Vassallo about her career thus far, and her goals for the future.

Hers is actually a very familiar story in Silicon Valley, land of the super achievers. After earning three degrees from Stanford – a bachelor’s and master’s degree in mechanical engineering and an M.B.A. – Vassallo headed to IDEO, where she designed products for Palm and Dell. She then cofounded the mobile device company Good Technology, which later sold to Motorola.

By 2003, Vassallo had been invited to join Kleiner Perkins, just as the firm was beginning to bet heavily on green tech. Vassallo worked closely with a number of related management teams, including RecycleBank, a green rewards and loyalty network; Altarock Energy, a geothermal development company; and the electric luxury car company Fisker Automotive.

But it was Vassallo’s innate knowledge of mechanical engineering that became her biggest triumph. While Kleiner Perkins’ partner Randy Komisar ultimately sat on the board of Nest, Vassallo was first to recognize the opportunity the startup presented to Kleiner, having investing so much of her time focused on smart grids and energy efficiency. In fact, Vassallo says, in the months before Nest founder Tony Fadell sat down with Kleiner, she was specifically studying thermostats as a way for consumers to more easily measure and control their energy usage.

According to Fortune, Vassallo further negotiated the Series A round on behalf of Kleiner and continued to support the management team, including through introductions to utilities.

The deal returned Kleiner a reported 20 times its investment when Nest sold to Google last month for $3.2 billion in cash.

But Nest wasn’t Vassallo’s only connected-device deal. In 2011, she also led Kleiner into Enlighted, a lighting control tech company that can individually measure and manage lighting at each light fixture and reduce energy consumption by 50 to 75 percent. Designed for offices and commercial buildings, Vassallo likens it to a “Nest for the enterprise,” particularly given its ultimate goal of proving security and other features beyond lighting.

As a next step, Vassallo says she’s looking for more related opportunities. For example, she sees a day when every home has numerous tablets that cost next to nothing and form a kind of in-home communications system.

Vassallo is also interested in companies that apply social benchmarking to connected devices and put the numbers they generate into a more useful context. “I don’t necessarily want my friends to know how out of shape I am,” she jokes, “but I’d be interested in knowing how [my fitness level] compares to other working moms in the same age range.”

I ask Vassallo if she’s also interested in working more closely with other women VCs, a growing number of whom have been striking out on their own. She is friendly with longtime DFJ investor Jennifer Fonstad, for instance, and says she’s thrilled that Fonstad and Theresia Gouw, a former managing director at Accel Partners, have joined forces to create a new, self-funded venture firm.

“I think women should do business together,” she tells me, determined not to give away anything about her plans yet. “I think it’s important to have one another’s backs.”

For now, though, Vassallo is focused on Silicon Valley’s next generation. This weekend, she’s judging an “entrepreneurship” contest at the middle school of one of her three children. She also created a robotics program at Castilleja School, a school for girls in Palo Alto.

Sitting in her glass-lined office, Vassallo says, half-kiddingly, that she used to wonder why she nabbed a degree in mechanical instead of computer engineering. Today, that training is beginning to pay off in all kinds of ways.


New Fundings

Birdback, a 20-month-old, London based app platform for payment cards, has raised $2.4 million led by Passion Capital, with participation from Paul NikkelLuke JohnsonPlayfair Capital and #1seed. The company links online to offline offers, such as cash-back and other loyalty offers. TechCrunch has more here.

Bloomthat, an 18-month-old, San Francisco-based flower-delivery startup, has raised $2 million in funding from SV AngelA-Grade Investments,Joe MontanaAlexis Ohanian and Y Combinator.

CircleCI, a three-year-old, San Francisco-based company whose tools enable development teams to quickly deliver features to customers, has raised $6 million in funding led Draper Fisher Jurvetson. The company has raised $7.5 million altogether, including from investors Baseline Ventures and Harrison Metal.

Embrane, a four-year-old, Santa Clara, Ca.-based company that makes software for the delivery and management of network services in data centers, has raised $12 million in fresh funding led by Cisco Systems. Others of its investors include New Enterprise AssociatesLightspeed Venture Partners, and North Bridge Venture Partners. The company has raised roughly $40 million to date.

PayNearMe, a 4.5-year-old, Sunnyvale, Ca.-based cash payment network, has raised $20 million in Series E funding led by GSV Capital, withAugust CapitalKhosla VenturesMaveron and True Ventures also participating. The company, led by serial CEO Danny Shader, has now raised more than $56 million.

Truecaller, a 4.5-year-old, Stockholm, Sweden-based mobile phone number verification directory, has raised $18.8 million in Series B funding led by Sequoia Capital, alongside existing investor Open Ocean, Truecaller Chairman Stefan Lennhammer, and another, unnamed investor. The company has raised roughly $20 million to date.

Vungle, a three-year-old, San Francisco-based mobile ad startup that focuses on 15-second, in-app videos, has raised $17 million in Series B funding led by Thomvest Ventures, with participation from existing investors Crosslink CapitalGoogle VenturesAOL VenturesSoftTech VC, and Webb Investment Network. The company has raised $25.5 million to date, shows Crunchbase.


New Funds

Clarus Ventures, a nine-year-old, Cambridge, Ma.-based life sciences venture firm, is targeting $375 million for its third fund, shows an SEC filing. At that size, the pool would be meaningfully smaller than Clarus’s last two funds. (The firm closed its second, $660 million fund, in 2008 and its inaugural, $500 million, fund in 2005.) Interestingly, it has turned to Magog & Cie, a Dubai-based placement agent, for help, according to the filing.

Harbor Capital Group, a newly formed, Bloomington, In.-based company, will soon begin investing capital in young 3-D printing, big-data and robotics companies. CEO Jim Zitek says the firm isn’t assembling a dedicated fund but plans to form limited partnerships around each investment, giving individual investors an opportunity to back some startups but not others. You can read more here.



Azuki Systems, a six-year-old, Acton, Ma.-based multiscreen video delivery platform, has been acquired by telecom giant Ericsson for an undisclosed amount. Azuki, formerly called Permeeta, had raised roughly $35 million over the years, reports Xconomy, including from Sigma Partners and Kepha Partners.

Bright, a three-year-old, San Francisco-based data-driven job search startup, has been acquired by LinkedIn for $120 million in mostly stock. Bright had raised roughly $20 million in funding from Toba Capital andPassport Capital. Re/code has more here.

LeadRocket, a Redwood City, Ca.-based social engagement and digital marketing platform provider, has been acquired by Callidus Software, a publicly traded sales and marketing cloud software company. Terms of the deal weren’t disclosed. LeadRocket had raised funding from Emergence CapitalMohr Davidow VenturesAccel PartnersDeep Fork Capital, the venture debt firm WTI, and Catapult Advisors.

MobiTargets, a 3.5-year-old, Madrid-based mobile ad network, has been acquired by adQuota, a 3.5-year-old, Copenhagen-based mobile advertising platform that is growing its European presence. Terms of the deal weren’t disclosed, but adQuota recently raised around $3.4 million from the Danish venture firm Northcap.

Myntra, a seven-year-old, Bangalore-based fashion apparel e-tailer, has raised roughly $50 million led by Premji Invest, along with new and existing investors. This funding brings the company’s total funding to around $75 million.

Ness Computing, a three-year-old, Los Altos, Ca.-based maker of a personalized restaurant recommendations app called Ness, has been acquired by the restaurant reservation platform OpenTable in a deal worth $17.3 million. Ness had raised $20 million from investors, including Khosla VenturesAlsop Louie PartnersBullpen CapitalTomorrowVenturesSingTel Innov8 and American Express.

SET Media, a 6.5-year-old, New York-based digital video technology company that connects brands with people through targeted video advertising, has been acquired by the publicly traded, personalized digital marketing company Conversant. Terms of the deal weren’t disclosed. SET had raised $10 million from Crosslink Capital and Highland Capital Partners.



Venture capitalist Ben Horowitz writes candidly about a business hire who might easily (if inadvertently) have landed him in jail.

Kleiner Perkins, its partner emeritus Ray Lane, and several others connected to Fisker Automotive have been named in a new lawsuit that alleges they misled investors in the now-bankrupt hybrid car company. The suit alleges that the defendants concealed negative information about Fisker’s business from plaintiffs and other investors “because they needed huge sums of additional cash to fund Fisker Automotive to position the Company for a sale or an initial public offering…without plaintiffs’ and other investors’ money, Fisker Automotive was not a viable company.” The Journal has the story.


Job Listings

Uber is looking for a head of business development to help further the brand’s reach across Europe, the Middle East and Africa. Requirements include 7 to 10 years of business development experience across the region. Apply here.



A growing number of backend-as-a-service (BaaS) vendors are enabling mobile and app developers to link their apps to a back-end cloud infrastructure and features including push notifications and social media integration. VCs are paying attention, too, notes CB Insights, which has published some helpful data around the trend.


Essential Reads

Klout pivots again.

Silicon Valley has taken over the Secret app and the gossip being posted is priceless.

So much for slowing or stopping the patent monetization business. A patent infringement trial positioning Intellectual Ventures against Motorola Mobility ended in a mistrial when a jury couldn’t reach a verdict following two days of deliberations.



As technology gets better, will society get worse?

Twelve ways to get what you want.


Retail Therapy

From the fine folks at Ford, the F-150 RaptorTrax. If there’s a bigger, badder snowmobile out there, we shudder to imagine it.


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