• StrictlyVC: April 15, 2014

    Good morning! Hope readers are enjoying a happy Passover.

    We’re going without a column today as StrictlyVC ran a teensy bit short on time yesterday. We have a lot of good stuff coming this week, though. (We’re particularly excited to sit down with one high-profile, low-flying firm that readers have specifically asked StrictlyVC to feature.) In the meantime, enjoy today’s issue and we’ll see you tomorrow!

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    Top News in the A.M.

    You can buy Google Glass today.

    Speaking of Google, it’s planning a major expansion in New York, the WSJ is reporting this a.m.

    This morning, AngeList is also taking the wraps off Maiden Lane, a new, $25 million fund that will bet roughly $200,000 on the each of the site’s top investors and on select startups picked by them.

    DOD

    New Fundings

    Betterment, a 5.5-year-old, New York-based online investment platform, has raised $32 million in Series C funding co-led by Citi VenturesGlobespan Capital Partners and Northwestern Mutual. Earlier investors Bessemer Venture PartnersMenlo Ventures, and Anthemis Group also participated in the funding, which brings Betterment’s total funding to $45 million, shows Crunchbase. (This space is really heating up, as you may have noticed. Betterment competes with Wealthfront, which announced a $35 million round earlier this month; others of its many competitors include Personal CapitalSigFig, and FutureAdvisor.)

    Farmer’s Business Network, a new, Menlo Park, Ca.-based company, has raised $4.6 million from investors, according to an SEC filing that shows a $6 million target. The filing lists only Amol Deshpande, who joined Kleiner Perkins Caufield & Byers as a partner in 2008 to focus primarily on greentech.

    Genesis Media, a 2.5-year-old, New York-based video advertising platform, has raised $10 million in Series B funding led by Blue Chip Venture CompanyCrown Predator Holdings also participated in the funding.

    Gusto, a nine-month-old, Indianapolis, In.-based company behind an email productivity app of the same name, has raised $1.3 million in funding led by Elevate Ventures.

    Lifesum, a six-year-old, Stockholm, Sweden-based company whose health and fitness app helps users track the food and calories they consume, has raised $6.7 million in Series A funding led by the German multinational media company Bauer Media Group and SparkLabs Global Ventures.

    Manicube, a two-year-old, New York-based tech-enabled startup that offers manicures and pedicures to office employees, has raised $5 million in funding from Bain Capital Ventures and F Cubed. The company has raised $5.85 million altogether.

    Lamudi, a seven-month-old, Berlin-based real-estate classifieds platform that operates in 21 markets in Asia, Africa, the Middle East and South America, has raised $7 million from a range of investors, including Tengelmann VenturesRocket Internet, the Berlin-based startup incubator, had created Lamudi last fall by consolidating multiple real-estate services, says TechCrunch.

    Brigade Media, a San Francisco-based, still-stealth company, has raised $9.3 million from several high-profile investors, including investor-entrepreneur Sean Parker, investor Ron Conway, and Salesforce CEOMarc Benioff. Parker will also be taking over as chairman and CEO, at least on an interim basis, reports TechCrunch.

    SeedInvest, a nearly two-year-old, New York-based equity crowdfunding platform that helps startups raise capital, has launched a new campaign to raise $3 million in Series A funding for itself. The startup has already raised $2 million toward its goal, including from Scout VenturesGreat Oaks Venture CapitalAvenue A VenturesArcher Gray and Krillion Ventures. Last year, SeedInvest raised $1 million in funding from the Jumpstart New Jersey Angel Network and individual investors.

    SilverRail Technologies, a five-year-old, Woburn, Ma.-based company whose search and distribution platform aggregates global rail content into a unified system, standardizing the search, booking, and fulfillment processes, has raised $40 million in Series C funding led by Mithril Capital Management. Earlier investors Canaan PartnersSutter Hill Ventures and Brook Ventures also participated in the round, which brings SilverRail’s total funding to roughly $70 million, shows Crunchbase.

    StarWind Software, an 11-year-old, Wakefield, Ma.-based maker of software-defined storage for Hyper-V environments (a virtualization platform for small-and mid-size businesses), has raised $3.25 million in Series B funding led by Almaz Capital, with participation from ABRT Venture, and AVentures Capital.

    VanDyne SuperTurbo, a five-year-old, Loveland, Co.-based company that’s developing a next-generation engine efficiency technology, has raised a $15 million Series C round led by Northwater Capital, with participation by earlier, undisclosed investors in the company.

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    New Funds

    Kleiner Perkins Caufield & Byers is looking to raise $450 million for its 16th early-stage fund (down from the $525 million fund it raised two years ago) and $750 million for its second “digital growth” fund, compared to its $1 billion predecessor. Dan Primack of Fortune has the story, along with some other interesting notes, including about numerous new staffers who’ve recently appeared on the site of KPCB.

    Real Ventures, a six-year-old, Montreal-based seed-stage venture capital fund that focuses on Internet and mobile startups in Canada, has announced that it held its first closing of its third fund at $50 million and that it expects the fund to reach $100 million by its final closing. The lead investors in the new fund are Québec-based Teralys CapitalFIER Partenaires, and the Business Development Bank of Canada. One of Real Ventures’s newest investments is in Crew, a freelancer marketplace that connects Web developers with projects and that this month closed a$2.1 million round led by Atlas Venture. One of its best-known investments is in Beyond the Rack, a private online shopping club that has raised nearly $80 million from investors.

    Tiger Global Management, the 13-year-old, New York-based investment firm, has a new $1.5 billion fund, according to an SEC filing. The fund comes as little surprise, given the pace at which Tiger has been deploying capital, leading or co-leading massive, double-digit rounds for Quora,ActifioonDeck CapitalEventbrite and Warby Parker — and that’s just since December.

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    Exits

    Gnip, the six-year-old, San Francisco-based social data provider, which has long provided access to public Twitter data, is being acquired byTwitter for (as of this writing) undisclosed terms. Gnip has raised roughly $6.5 million from investors, including Foundry GroupSoftTechVC, and First Round Capital.

    Maker Studios, the five-year-old, L.A.-based video production network that agreed to sell to Disney last month for $500 million in cash, and $950 million if Maker hits certain performance milestones, was offered an even sweeter financial deal yesterday by Relativity Media. Relativity proposed spending $525 million in cash for Maker and another $500 million in cash and stock if financial targets were met. It also threw in a kicker of up to $75 million in stock atop everything in a bonus pool for “key talent and executives.” Maker quickly said “no thanks” to Relativity. But a company to keep an eye on, says Re/code, is Fullscreen, a Maker competitor backed by Comcast and the Chernin Group.

    Motorola is selling its tracking technology unit to publicly traded Zebra Technologies for $3.45 billion, Bloomberg is reporting this morning. Zebra plans to fund the deal with about $200 million of cash and $3.25 billion in new debt — almost Zebra’s total value, based on yesterday’s stock price. Both companies offer bar-code scanning, radio-frequency identification and other technology that companies can use to control their inventory.

    Titan Aerospace, a two-year-old, New Mexico-based maker of high-altitude drones, has been acquired by Google for an undisclosed price. Facebook had been in talks to acquire Titan earlier this year but later said it would buy Ascenta, a U.K.-based aerospace company at work on solar-powered unmanned aerial vehicles. The WSJ has more here.

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    People

    Investor, entrepreneur, and tweet champ Marc Andreessen has followed up his initial tweetsteam about new tech growth company valuations, with “current info on large cap tech valuations.” He tweeted last night (and we’re condensing his tweets here) that the P/E ratios of the biggest companies, including Apple, Google, and Microsoft are “still so low as to qualify as generational lows . . . ” Andreessen went on to tweet that “If this is a new tech bubble, it’s managing to bypass all of the big public tech companies,” and that “to rationalize all of this, you pretty much have to believe one of three things: A.) This is the weirdest equity bubble ever, ignores the large cap companies that are easy to trade — not what happened in late 90’s. B.) Public market still scarred after 2000 and 2008 crashes, hates tech equities, except a handful of companies delivering rare growth. C.) Or, many large-cap tech companies are in dire trouble, about to be taken apart by new generation of disruptive challengers.” In the end, Andreessen agreed with someone who proposed a fourth alternative: That’s we’re still in the early stages of an economic recovery. (Let’s hope!)

    Former employees of Clinkle paint an unflattering picture of Lucas Duplan, the young founder of the mobile payments company, as well as Barry McCarthy, the former Netflix exec who was, for a brief time, the company’s chief operating officer. Business Insider has the story here.

    “The Social Network” director David Fincher has reportedly been booted off the Steve Jobs biopic being scripted by Aaron Sorkin, owing to his “aggressive demands,” says the Hollywood Reporter. In addition to wanting Christian Bale to play the lead, the Reporter says Fincher had been “seeking a hefty $10 million up front in fees, as well as control over marketing.”

    Alyssa Henry has joined the mobile payments company Square as its new engineering lead in charge of Square‘s infrastructure and payments platform. Former Facebook exec Gokul Rajaram will continue to run product engineering for Square. Henry most recently ran the data storage business for Amazon Web Services and logged a dozen years at Microsoft, reports Re/code.

    President Obama will visit the Bay Area in May for two fundraisers, including at the Palo Alto home of Yahoo CEO Marissa Mayer and the Los Altos home of Ann Wojcicki, CEO of the biotech genetic testing firm 23andMereports the San Francisco Chronicle. Tickets for Wojcick’s event cost $32,400; tickets for the event at Mayer’s home will range from $1,000 to $10,000.

    Chase Jarvis, the founder of the online education company CreativeLive, is newly its CEO, as Mike Salmi steps down after two years in the role. Salmi was previously a Viacom/MTV exec after selling his company Atom Entertainment for $200 million in 2006; on his watch, CreativeLive raised $30 million in two rounds of funding, grew to 85 employees from eight and opened a big studio in San Francisco, reports Re/code.

    Ajai Sehgal has just joined Vancouver-based social media management platform HootSuite as its new chief technology officer. Sehgal spent the last couple of years at Groupon as a VP of product and technology and roughly the dozen years prior in senior technology roles at Expedia.

    Y Combinator yesterday announced four new partners as part of a broader plan to grow fast and pull more startups into its accelerator program. Here’s Sam Altman, YC’s president, in a blog post about the appointments.

    —–

    Job Listings

    DFJ has just begun a search for a senior associate; the job is on Sand Hill Road in Menlo Park.

    451 Research is looking for a research associate to join its team in downtown San Francisco.

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    Happenings

    TechCrunch Disrupt is coming up in Manhattan May 5th through May 7th. Learn more here.

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    Data

    U.S. venture capital firms raised more money in the first quarter of this year than they have in seven years. According to new data out of the NVCA and Thomson Reuters, 58 venture funds gathered $8.9 billion in new commitments in the first three months of this year, more than the double to amount of capital raised in the first quarter of 2013. In fact, it was the strongest quarter for fundraising since the last quarter of 2007, when U.S. venture firms amassed $10.4 billion. You can learn more here.

    According to a report from iStrategy Labs, more than 3 millions teens have left Facebook since 2007, while the 55-plus demographic has grown by more than 80 percent.

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    Essential Reads

    Heartbleed disclosure timeline: Who knew what and when.

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    Detours

    A Chrome extension that looks for the phrase “the cloud” in webpages and changes it to “my butt.” (Yes, we’re juvenile enough to think this is hilarious.)

    Why we yawn.

    Kafka’s joke book.

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    Retail Therapy

     

    Hanley Mellon. Gawker aptly describes it as the perfect destination “for people who yearn to spend tens of thousands of dollars on clothes but have no one to tell them what to wear.” Still, we can look!

     

    Convert your records straight to your iPad or iPhone with the iLP Digital Conversion Turntable.

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  • StrictlyVC: April 14, 2014

    Good morning; hope you had a great weekend!

    —–

    Top News in the A.M.

    The New York Times looks at the ocean of late-stage cash washing over tech startups, and why, in most cases, VCs welcome it with open arms.

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    Silicon Valley Banker to Buyers: Shop Like a VC

    Kelly Porter isn’t terribly conventional. The Palo Alto native is a vivid storyteller. He has had more careers than most, including as a media planner, a CEO, a venture capitalist, and, today, as an investment banker. In fact, as a partner and managing director of the investment bank Woodside Capital Partners, Porter has become known for the firm’s annual, invite-only M&A conference, which is hosted at a Great Gatsby-esque, 30,000-square-foot mansion that Porter purchased in 1999 (and is now keen to sell).

    Porter also has some provocative thoughts about what acquiring companies could do better, as I learned Friday morning when we met in a bustling restaurant in San Francisco’s Laurel Heights neighborhood. Here’s part of that conversation, edited for length.

    The common perception is that M&A doesn’t work. How many tech-related deals are done each year, and what percentage fail, would you say?

    There is an extremely high failure rate. According to [S&P] Capital IQ, when it comes to software and Internet services, there are between 3,000 and 5,000 acquisitions every year. And two-thirds to three-quarters of all acquisitions don’t achieve their [expected potential].

    Interestingly, there’s this common wisdom in the innovation ecosystem that certain serial acquirers acquire most of the companies. But there’s a very long tail. Over the last five years, the top 25 acquirers have only made up about four percent of all acquisitions. Google is in the several-hundred-companies range, then it drops off as you [move down the list to] IBM, Oracle, Microsoft, Yahoo, Autodesk, Cisco, Apple. When you get down to the 25th largest acquirer – and these are announced deals – they’ve only done 11 acquisitions over a five-year period.

    Is there a correlation between failure rates the number of companies a buyer acquires?

    I think one of the reasons there’s such a high failure rate is that the acquirers are primarily acquiring out of the venture-ecosystem. And in that ecosystem, one or two startups pay for the rest. But if most acquirers are acquiring three or four or five companies over a five-year period, they’re not really assembling a portfolio.

    Should they be, given that acquisitions are huge distractions? What of the counterargument that the more companies a buyer acquires, the worse off all of them will be?

    Acquirers, since they are acquiring from that ecosystem, are subject to portfolio dynamics. They’re probably picking up the best companies that don’t go public, but they’re still picking up companies that are fragile, that are early-stage. And there are some unique dynamics in acquisitions that make success even more difficult, like differences in culture, poorly articulated goals, strategic visions that are different, entrepreneurs who want to get on to the next thing and so forth. It makes that portfolio piece even more important.

    The real problem is the CEOs and CFOs are very focused on Wall Street, because if they acquire five or ten companies and five of them fail, they’ll get skewered. Google can afford to [acquire lots of companies] because of the concentration of ownership that Larry [Page] and Sergey [Brin] enjoy but also because Google is [adding] $1.5 billion to the bottom line every month, and you can bury a lot of mistakes in that kind of growth. Facebook is a similar situation.

    Speaking of Facebook, what do you make of Mark Zuckerberg’s recent moves?

    I think they’re very interesting. He’s in a unique position in that he has so much control over that company that he can make bold bets as he did with Instagram and WhatsApp. He’s getting skewered for having done them, but it’s like being an entrepreneur at a very large scale. And I think that’s an admirable thing that we don’t see much in this ecosystem.

    DOD

    New Fundings

    Admittedly, a year-old, New York-based company whose “college advisory” software promises to help students improve their chances of admission, has raised $615,000 in convertible note funding, according to Crunchbase. The money comes from Quotidian Ventures and angel investor Joanne Wilson.

    CarJump, a 14-month-old, Berlin, Germany-based company whose app aggregates data from Germany’s top car-sharing services, has raised an undisclosed amount of seed round of funding led by High-Tech Gründerfonds.

    Julep, a 7.5-year-old, Seattle-based beauty brand, has raised $30 million in Series C financing from new investors Azure CapitalMadrona Venture Group and Altimeter Capital, as well as existing investors Andreessen Horowitz and Maveron. The new investment brings Julep’s total venture funding to $56 million.

    Lucidity Lights, a 3.5-year-old Cambridge-based developer of next-generation lightbulbs, has raised $10.8 million in new funding, according to an SEC filing. Among its backers: New York-based New Legacy Capital.

    NatureBox, a two-year-old, San Carlos, Ca.-based company that creates, packs and delivers healthy snacks to users’ doors, has raised $18 million in Series B funding led by Canaan Partners. Earlier investors General Catalyst Partners and Softbank Capital also participated in the round, which brings NatureBox’s total funding to $28.5 million.

    Piqur Therapeutics, a three-year-old, Basel, Switzerland-based pharmaceutical company that’s focused on cancer-fighting drugs, has closed its Series A round with $36 million, $12.5 million of which came from Versant Ventures. The company has raised $42.2 million to date.

    Slidely, a nearly two-year-old, Tel Aviv-based social platform where users can share photos, videos, and music, has raised $7.3 million in funding led by Benson Oak Capital.

    Space Monkey, a nearly three-year-old, Midvale, Ut.-based maker of cloud storage devices, has raised a new, undisclosed amount of funding led by Alta Ventures Mexico. The company had previously raised $2.25 million from Google VenturesVenture51, and Data Collective, shows Crunchbase.

    Storefront, a two-year-old, San Francisco-based startup that’s been described as the Airbnb of retail (it helps merchants find and rent store space for a few days to a few months), has raised $7.3 million in funding led by Spark Capital. The company has raised $8.9 million altogether, including from earlier investors Mohr Davidow VenturesGreat Oaks Venture Capital500 StartupsBoxGroup, and Sand Hill Angels, among others.

    Ubiquitous Energy, a three-year-old Cambridge-based solar-energy materials startup, has raised $5.3 million, shows an SEC filing. According to Xconomy, has deep MIT ties and is developing coatings that it says could generate electricity from everyday surfaces, including windows.

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    New Funds

    Founder’s Co-op, a six-year-old, Seattle-based seed-stage venture firm, has raised $10 million for its newest fund and could raise up to $25 millionfor the effort, according to cofounder and general partner Chris DeVore. Founder’s Co-op closed its first, $8 million, fund in January 2012. StrictlyVC recently featured one of its portfolio companies: Lighter Capital. Others of its investments include Remitly, a mobile payments service that helps its users make person-to-person international money transfers from the U.S., and Shippable, a company that helps development teams ship software faster.

    Station 12, a new, London-based venture capital firm, is raising a debut fund of up to $250 million to provide growth capital to Europe’s media, entertainment and media technology companies, the company tells Variety. The firm was founded by Patrick Bradley, the former chief executive ofIngenious Ventures, which backed Simon Fuller’s 19 Management, the company behind “American Idol” (it sold to CKX for $210 million in cash and stock); and video-games producer Lionhead Studios (which sold to Microsoft for an undisclosed sum). The firm says it has already identified a “pipeline of potential investments” and will start investing with an initial average of about $16 million per deal. Station 12, notes VentureBeat, is named after a U.K. intelligence hub of the 1940s.

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    IPOs

    Jumei, a 4.5-year-old, Beijing-based site that sells beauty products and perfumes, filed to go public in the U.S. on Friday, revealing plans to raise up to $400 million. Jumei is among the top 20 most visited e-commerce websites in China and its top shareholders include Super ROI Global, which owns 40.7 of the company; Sequoia Capital, which owns 18.7; K2 Partners, which owns 10.3 of the company; Success Origin Limited, which owns 8.8 percent; and Pinnacle High-Tech Limited, which owns 6.3 percent. Some 30 Chinese companies could list in the United States this year, according to Reuters.

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    Exits

    Colimetrics, a two-year-old, Bangalore-based startup that makes employee productivity software, has been acquired by the San Jose, Ca.-based mobile tech startup ActMobile Networks. Terms of the deal weren’t disclosed, but the Economic Times characterizes the deal as an acqui-hire.

    GnuBIO, a five-year-old, Cambridge, Ma.-based developer of scalable DNA sequencing technology, has been acquired by publicly held Bio-Rad Laboratories, a maker of life science research and clinical diagnostic products. GnuBIO had raised $22.5 million in venture funding from undisclosed investors, according to Crunchbase. The terms of its acquisition weren’t disclosed.

    RapidEngines, a 3.5-year-old, Minneapolis, Mn.-based company that collects and organizes log data for its customers, has been acquired bySevOne, a nine-year-old, Wilmington, De.-based company that monitors the performance of thousands of IT systems for large customers like Comcast. RapidEngines had raised at least $1.38 million in seed funding, show SEC filings. SevOne has raised $152 million from Osage Venture Partners and Bain Capital Ventures.

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    People

    Serial entrepreneur Rich Barton, a founder of ExpediaZillow, and Glassdoor, maintains a low profile, and that’s very much by design, he tells the New York Times. “Personally, I like living here better,” Barton says of Seattle. “People do other things. I can go to a soccer game, and I’m not standing with the co-founder of this and a venture capitalist at that.”

    The America’s Cup left San Francisco a few million dollars in the red, but the spendy billionaire who brought the event to town, Larry Ellison, isn’t stepping up to cover the deficit, notes the New York Times.

    Even the founder of a powerful law firm can lose a case every now and then. On Friday, Robert Gunderson, co-founder of Gunderson Dettmer, lost a bid to relocate a hiking trail near the multimillion-dollar Hawaiian vacation home of his family. The Gundersons had spent “many millions more” trying to ensure the home wasn’t visible from the trail, including moving the trail closer to the shoreline. But in 2007, after some hiking accidents occurred, it was moved back by the county, and there, apparently, it will stay. (The judge also ordered Gunderson to pay $200,000 in attorneys fees over the case.)

    At Columbia University’s first entrepreneurship festival, venture capitalist Alan Patricof went rogue, politely suggesting the student attendees might want to consider working at a company rather than launching their own. As he told New York Business Journal afterward: “Everyone who graduates today wants to be an entrepreneur. They don’t want to go work for another company. Working for another company’s not so terrible.”

    Yesterday, Business Insider published a Q&A with venture capitalist Fred Wilson about his career that’s very much worth reading. He explains, for example, why USV has brought a new person into each of its successive early-stage funds: “…that person drives a lot of the new investment activity in that fund because the existing partners have legacy portfolio companies we spend a lot of time on. There’s no way I could make eight investments, for example, in the next three or four years. But when someone comes in here without a legacy portfolio, they can do that. That model has worked really well for us.”

    Niklas Zennstrom talks with Venture Capital Dispatch, including about whether Atomico is starting to back enterprise companies. “We’ve not done enterprise so far—our view is from the consumer side—but enterprise is becoming more consumerized . . .We’re quite careful chasing companies that are creating large user bases, so for example different apps; we’ve seen how hard it is to create a user base and turn it into a revenue stream.”

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    Job Listings

    Kickstarter is looking for a VP of operations and finance. The job is in Brooklyn.

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    Happenings

    The VentureBeat Mobile Summit kicks off today in Sausalito, Ca. Here is the agenda.

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    Data

    Sand Hill Road’s heaviest hitters have all made notable bets on New York City startups. But based on CB Insights‘s data, their share of New York deals has remained largely flat over the past five years. More here.

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    Essential Reads

    Confirming long-running reports that Amazon has been working on a smartphone, the WSJ reports that one is coming in the second half of this year. To differentiate the phone from the competition, the phone will feature a screen capable of displaying seemingly three-dimensional images without special glasses.

    Tomorrow, in Yahoo‘s earning call, it will reveal revenue and profit numbers from Alibaba, helping to set the stage for Alibaba’s expected U.S. IPO, which may value the company at more than $100 billion, according to analysts.

    The most dangerous word in tech?

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    Detours

    What sleep deprivation does to you, in one upsetting infographic.

    Highy useful things you can learn in a few minutes.

    The rich architecture hidden inside acoustic instruments.

    How to buy college football players: “The rules of communication tend to follow your typical sleeper cell or drug-dealing outfit. Talk in person as much as possible, preferably in group settings. Don’t use email. Never interact with the media and avoid the university’s public relations or sports information departments whenever possible. And buy burners. Lots of burners.”

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    Retail Therapy

    The 2015 Ducati Diavel. [Sigh.]

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  • Silicon Valley Banker to Buyers: Acquire Like You’re Mark Zuckerberg

    KellyPorter_smKelly Porter isn’t terribly conventional. The Palo Alto native is a vivid storyteller. He has had more careers than most, including as a media planner, a CEO, a venture capitalist, and, today, as an investment banker. In fact, as a partner and managing director of the investment bank Woodside Capital Partners, Porter has become known for the firm’s annual, invite-only M&A conference, which is hosted at a Great Gatsby-esque, 30,000-square-foot mansion that Porter purchased in 1999 (and is now keen to sell).

    Porter also has some provocative thoughts about what acquiring companies could do better, as I learned Friday morning when we met in a bustling restaurant in San Francisco’s Laurel Heights neighborhood. Here’s part of that conversation, edited for length.

    The common perception is that M&A doesn’t work. How many tech-related deals are done each year, and what percentage fail, would you say?

    There is an extremely high failure rate. According to [S&P] Capital IQ, when it comes to software and Internet services, there are between 3,000 and 5,000 acquisitions every year. And two-thirds to three-quarters of all acquisitions don’t achieve their [expected potential].

    Interestingly, there’s this common wisdom in the innovation ecosystem that certain serial acquirers acquire most of the companies. But there’s a very long tail. Over the last five years, the top 25 acquirers have only made up about four percent of all acquisitions. Google is in the several-hundred-companies range, then it drops off as you [move down the list to] IBM, Oracle, Microsoft, Yahoo, Autodesk, Cisco, Apple. When you get down to the 25th largest acquirer – and these are announced deals – they’ve only done 11 acquisitions over a five-year period.

    Is there a correlation between failure rates and the number of companies a buyer acquires?

    I think one of the reasons there’s such a high failure rate is that the acquirers are primarily acquiring out of the venture-ecosystem. And in that ecosystem, one or two startups pay for the rest. But if most acquirers are acquiring three or four or five companies over a five-year period, they’re not really assembling a portfolio.

    Should they be, given that acquisitions are huge distractions? What of the counterargument that the more companies a buyer acquires, the worse off all of them will be?

    Acquirers, since they are acquiring from that ecosystem, are subject to portfolio dynamics. They’re probably picking up the best companies that don’t go public, but they’re still picking up companies that are fragile, that are early-stage. And there are some unique dynamics in acquisitions that make success even more difficult, like differences in culture, poorly articulated goals, strategic visions that are different, entrepreneurs who want to get on to the next thing and so forth. It makes that portfolio piece even more important.

    The real problem is the CEOs and CFOs are very focused on Wall Street, because if they acquire five or ten companies and five of them fail, they’ll get skewered. Google can afford to [acquire lots of companies] because of the concentration of ownership that Larry [Page] and Sergey [Brin] enjoy but also because Google is [adding] $1.5 billion to the bottom line every month, and you can bury a lot of mistakes in that kind of growth. Facebook is a similar situation.

    Speaking of Facebook, what do you make of Mark Zuckerberg’s recent moves?

    I think they’re very interesting. He’s in a unique position in that he has so much control over that company that he can make bold bets as he did with Instagram and WhatsApp. He’s getting skewered for having done them, but it’s like being an entrepreneur at a very large scale. And I think that’s an admirable thing that we don’t see much in this ecosystem.

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  • StrictlyVC: April 11, 2014

    As you know, we love Fridays! Hope you have a great weekend, everyone, and we’ll see you Monday morning.:)

    —–

    Top News in the A.M.

    Intellectual Ventures, often described as a patent troll, has persuaded Microsoft and Sony to invest in its latest acquisition fund, reports Reuters. Apple and Intel, which invested with Intellectual Ventures previously, declined to participate again, say the outlet’s sources.

    The price of bitcoin fell to below $400 yesterday, more than 60 percent off its all-time high. (Here is where it’s looking at the moment.)

    —–

    Creatively Destroying Medicine

    Med tech has a long history of boom and bust. But yesterday, at a stellar half-day conference in Mountain View called Strictly Mobile, listening to famed cardiologist Eric Topol address the crowd, it was easy to believe that the pattern will be shattered. In fact, Topol, author of “The Creative Destruction of Medicine,” argued persuasively why little about today’s healthcare system will look the same in less than a decade.

    Receiving remote medical care is already becoming more common as technologies improve, as he noted. Startups like American Well and Doctors on Demand produce apps that allow users to video-chat with doctors to get medical help in real time. Scanadu makes a puck-shaped scanner that’s packed with sensors designed to read your vital signs, including heart rate, blood pressure, temperature, and blood oxygen levels. (The company, which recently began shipping the product, halted production last week to fix a manufacturing glitch.)

    Other companies hoping to make traditional medical instruments obsolete include EyeNetra, whose device, the Netra-G, can measure the refractive error of the eye using a smartphone and a cheap pair of plastic binoculars that anyone can use. (The alternative: a $5,000 machine called an autorefractor.) Similarly, CellScope turns a smartphone into an otoscope that provides a magnified view of the middle ear, allowing parents to see for themselves whether their child has an ear infection — instead of first dragging him to the doctor’s office.

    Naturally, there are plenty of obstacles between now and the day when hospitals can focus on therapeutics and leave more of the diagnostics to us. For one thing, not everyone wants to know more about their health. (Scanadu cofounder Sam De Brouwer, who was also at the conference, attributed such attitudes to consumers’ “lack of tools.” Noting that the only medical tool in most homes, still, is a thermometer, she suggested that people will grow very attracted to medical apps once they realize their power. “There’s something deeply fascinating about our body,” she told the assembled attendees.)

    A much bigger obstacle, said Topol, is the American Medical Association, which has a vested interest in maintaining the status quo and that has one of the largest lobbying budgets in the U.S.

    Here, Topol suggested that the best shot at change will come from directly from consumers demanding it, along with “employers with big-time purchasing power.” It’s an uprising that Topol fully expects as more information about healthcare costs becomes available. (Steven Brill’s 26,000-word piece in Time last year, highlighting the exorbitant prices we pay for hospital gauze and Tylenol tablets, was a good start, Topol noted.)

    A cynic might say that the picture Topol paints sounds too rosy and lacks specifics. Indeed, asked about the legal liabilities for already risk-averse doctors, Topol’s answer seemed optimistic. Doctors who’ve been freed by new technologies will likely develop stronger relationships with their patients, making them less inclined to sue, Topol suggested.

    Investors could also lose interest in digital health if it doesn’t take off fairly quickly. As veteran health care investor Terry McGuire of Polaris Ventures told me back in January, ““On the life sciences side, billion-dollar exits aren’t as common as on the tech side … So you go through these wonderful moments as now, when everyone is again a healthcare investor, but in three years, they won’t be.”

    I hope the skeptics are wrong. It was exhilarating to hear someone talk about mobile technologies that can help patients and doctors do so much more. The doctor will Skype me now? I’m ready.

    JamBase

    New Fundings

    Decisyon, an 8.5-year-old, Stamford, Conn.-based maker of collaborative business intelligence software, has raised $22 million in Series B funding from VCs, along with roughly $4 million in debt. The financing was led by Catalyst Investors and brings the company’s total funding to $32 million.

    Fundbox, a two-year-old, San Francisco-based company that helps small businesses out with short-term loans, has raised $17.5 million in Series A funding led by Khosla Ventures. Other participants in the round include SV Angels and individual investors, including former Citigroup CEO Vikram Pandit.

    Genesis Media, a four-year-old, New York-based ad company that shows video ads on its customers sites (that must be watched in order to access the free content), has raised $6 million in new fund. The round was led by Blue Chip Venture Capital, with participation from Crown Predator Holdings. TechCrunch has more here.

    The Hunt, a year-old, San Francisco-based fashion shopping app, has raised $10 billion in Series B funding led by Khosla Ventures, which was joined by earlier investors Javelin Venture Partners. the Hunt has now raised roughly $16 million to date. Founder and CEO Tim Weingarten had told StrictlyVC in January that he was in the market for new funding.

    Interfolio, a 15-year-old, Washington, D.C.-based SaaS platform for hiring in higher education, is looking to raise a $5 million Series B round, says the outlet ElevationDC. Reportedly, more than 200,000 scholars use Interfolio to manage their careers.

    Last, a new, San Francisco-based company founded by Josh Williams, a co-founder of the location-based service Gowalla, has raised $2.1 million in seed funding led by Freestyle Capital. Other participants in the round include Greylock PartnersFounders FundGoogle VenturesSherpa VenturesDesigner FundBoxGroupLaunch FundSV AngelFuel CapitalSlow VenturesRuchi SanghviPete CashmoreTom Conrad,Todd JacksonTom Watson, and Semil Shah. Gowalla’s team was acquired by Facebook in late 2011, which shut down the service several months later.

    Munchery, a three-year-old, San Francisco-based online food delivery business that produces some of the food it delivers, has raised $28 million in Series B funding led by Sherpa Ventures. Other participants in the round included earlier backers e.ventures and Menlo Ventures, as well as individual investors. The company has now raised close to $36 million to date, shows Crunchbase.

    Runscope, a 16-month-old, San Francisco-based company that makes debugging and testing tools for API developers, has raised $6 million in Series A funding led by General Catalyst Partners, with participation from True Ventures and Lerer Ventures.

    Smule, a 5.5-year-old, San Francisco-based maker of popular social music apps, has raised $16.6 million in new funding led by Roth Capital Partners. Earlier backers Bessemer Venture PartnersShasta Ventures, and Granite Ventures also participated in the round, which brings the company’s total funding to $42 million.

    Spinifex Pharmaceuticals, a nearly nine-year-old, Melbourne, Australia-based clinical-stage biotech company that’s developing pain treatment products, has raised $45 million in Series C funding led by Novo A/S. Other participants in the round included new investor Canaan Partners and earlier investors GBS Venture PartnersBrandon Capital PartnersUniseed and UniQuest. The company has raised at least $64 million to date, according to Crunchbase.

    Spoonrocket, a year-old, Berkeley, Ca.-based company that promises to deliver $8 meals to Bay Area customers’ doors in 15 minutes or less, has raised $10 million from Foundation Capital and General Catalystsays TechCrunch. The company has raised $12.5 million altogether.

    Zesty, a 1.5-year-old, London-based healthcare appointment booking platform, has added $2 million more to its seed round from TA Venturesand ABRT Fund. Zesty’s prior seed was secured back in January 2013, led by Mangrove Capital, though the size of that earlier funding hasn’t been disclosed, reports TechCrunch.

    —–

    New Funds

    Menlo Ventures, the 38-year-old, Sand Hill Road venture firm, is looking to raise $400 million for its twelfth multistage venture fund, say Bloomberg sources. Menlo Ventures’s last fund, closed in September 2011, was also a $400 million pool. (As Bloomberg notes, as of Sept. 30, its IRR was 18 percent, per Washington State Investment Board data.) Menlo had originally targeted $600 million to $800 million for that eleventh fund, according to Bloomberg. Menlo’s tenth fund, closed in 2005, was a $1.2 billion vehicle.

    —–

    IPOs

    Ruh roh. From USA Today: “All three of the initial public offerings that started to trade Thursday, lender Ally Financial and drugmakers Adamas Pharmaceuticals and Cerulean, all fell below their offering prices …. Ally Financial broke by falling 4.7 percent below its $25 a share offering price, while Adamas plunged 12 percent from its $16 a share IPO price and Cerulean lost 6.6 percent from its $7 IPO price …. While it’s unusual to see three IPOs break in one day, the number of such troubled deals continues to mount. There are now 58 IPOs priced within the past 12 months that are trading below their IPO prices, says John Fitzgibbon of IPOscoop.com. That means a quarter of all deals priced in the period are now broken.”

    —–

    Exits

    Zumbox, a 6.5-year-old, L.A.-based provider of digital postal mail services, is shutting down. The company had raised more than $28 million from investors, including Shelter Capital PartnersCompushare, and The Tornante Company, which is the investment firm of former Walt Disney Co. chief executive Michael Eisner. More here.

    —–

    People

    Amazon CEO Jeff Bezos‘s annual shareholder letter is out and Business Insider highlights some of its most interesting details, including that Amazon will pay unhappy employees to quit.

    Rupert Murdoch sits down with Fortune’s billionaire whisperer, Pattie Sellers, for a wide-ranging interview, including about his divorce from Wendi Deng and repairing his relationships with his adult children. He also tells Sellers that Mark Zuckerberg approached him about potentially acquiring Facebook in 2005. “I remember Mark coming down to visit my ranch. He was a very shy, quiet young man of about 20 or 21. And he was all for us getting together. And I didn’t take him up on it. I think he’s done a brilliant job,” Murdoch says.

    Six months after the Healthcare.gov debacle, U.S. Health Secretary Kathleen Sebelius is out the door. Officials insist that Sebelius made the decision to resign and was not forced out. (Though they did turn off the heat in her office in January.)

    Mark Vranesh, who has served as Zynga‘s CFO for the last six years, is leaving the company, a move that Zynga says was in the works since late last year. Vranesh will be replaced by David Lee, who was most recently a senior VP of finance at Best Buy. TechCrunch has the story here.

    Danny Zappin, the former chief executive of Maker Studios, isn’t giving up the fight. Last June, Zappin, along with Maker founders Scott Katz,Derek Jones, and Will Watkins filed a lawsuit against Maker Studios, several of the its other co-founders, board members, investors, lawyers and others over an alleged conspiracy to take control of the digital media company and divert assets. On Wednesday, they filed a separate lawsuit alleging that a judge should delay the upcoming vote on Disney’s proposed $500 million acquisition of Maker because Maker didn’t provide material information about the first lawsuit to its shareholders.

    —–

    Job Listings

    Octopus Investments in looking for an investment manager to concentrate primarily on debt-related investments. The job is in London.

    —–

    The Variety Entertainment and Technology Summit is coming up in Marina Del Ray May 5th through May 8th. You can find the agenda here.

    Xconomy‘s Napa Summit Event is coming up June 2nd and 3rd and will feature former GM CEO Rick Wagoner, EA founder Trip Hawkins, and TaskRabbit founder and CEO Leah Busque, among other speakers.

    Salil Deshpande of Bain Capital Ventures is putting on a small open-source conference on April 22nd in San Francisco. He’s expecting 150 to 200 people to attend the talks and another 350 to 400 people to swing by for the happy hour and drinks portion. He’s looking for one last investor or two to speak at the event, so if you’re interested, either email him directly or write us and we’ll connect you.

    —-

    Data

    Despite growing momentum in the SoCal tech ecosystem and some notable recent exits, the first quarter of this year saw the gap between L.A.’s ecosystem and the Bay Area widen in terms of both funding and the number of deals completed, says CB InsightsMore here.

    —–

    Essential Reads

    record-setting 40 percent of early adopters would buy a bigger iPhone, according to a new survey.

    The look at three Asian messaging apps that, like WhatsApp, could conceivably exit for multiple billions of dollars.

    —–

    Detours

    Yes, this wedding trailer is absurd, but we kind of love that an attorney couple made it. (Who says lawyers are boring?)

    A Washington, D.C.-based consumer group has just published a list of the most complained-about airlines.

    Billionaire James Dyson on how to fire someone.

    —–

    Retail Therapy

    Credit-card size Go-Comb gives new meaning to the words “pick pocket.” Ba-dum-bum. (All kidding aside, we just ordered one.)

    Skully Helmets. They’ll make you want to ride a motorcycle.

    —–

    To sign up for StrictlyVC, click here. To advertise, click here.

     

  • Creatively Destroying Medicine

    kablooeyMed tech has a long history of boom and bust. But yesterday, at a stellar half-day conference in Mountain View called Strictly Mobile, listening to famed cardiologist Eric Topol address the crowd, it was easy to believe that the pattern will be shattered. In fact, Topol, author of “The Creative Destruction of Medicine,” argued persuasively why little about today’s healthcare system will look the same in less than a decade.

    Receiving remote medical care is already becoming more common as technologies improve, as he noted. Startups like American Well and Doctors on Demand produce apps that allow users to video-chat with doctors to get medical help in real time. Scanadu makes a puck-shaped scanner that’s packed with sensors designed to read your vital signs, including heart rate, blood pressure, temperature, and blood oxygen levels. (The company, which recently began shipping the product, halted production last week to fix a manufacturing glitch.)

    Other companies hoping to make traditional medical instruments obsolete include EyeNetra, whose device, the Netra-G, can measure the refractive error of the eye using a smartphone and a cheap pair of plastic binoculars that anyone can use. (The alternative: a $5,000 machine called an autorefractor.) Similarly, CellScope turns a smartphone into an otoscope that provides a magnified view of the middle ear, allowing parents to see for themselves whether their child has an ear infection — instead of first dragging him to the doctor’s office.

    Naturally, there are plenty of obstacles between now and the day when hospitals can focus on therapeutics and leave more of the diagnostics to us. For one thing, not everyone wants to know more about their health. (Scanadu cofounder Sam De Brouwer, who was also at the conference, attributed such attitudes to consumers’ “lack of tools.” Noting that the only medical tool in most homes, still, is a thermometer, she suggested that people will grow very attracted to medical apps once they realize their power. “There’s something deeply fascinating about our body,” she told the assembled attendees.)

    A much bigger obstacle, said Topol, is the American Medical Association, which has a vested interest in maintaining the status quo and that has one of the largest lobbying budgets in the U.S.

    Here, Topol suggested that the best shot at change will come from directly from consumers demanding it, along with “employers with big-time purchasing power.” It’s an uprising that Topol fully expects as more information about healthcare costs becomes available. (Steven Brill’s 26,000-word piece in Time last year, highlighting the exorbitant prices we pay for hospital gauze and Tylenol tablets, was a good start, Topol noted.)

    A cynic might say that the picture Topol paints sounds too rosy and lacks specifics. Indeed, asked about the legal liabilities for already risk-averse doctors, Topol’s answer seemed optimistic. Doctors who’ve been freed by new technologies will likely develop stronger relationships with their patients, making them less inclined to sue, Topol suggested.

    Investors could also lose interest in digital health if it doesn’t take off fairly quickly. As veteran health care investor Terry McGuire of Polaris Ventures told me back in January, ““On the life sciences side, billion-dollar exits aren’t as common as on the tech side … So you go through these wonderful moments as now, when everyone is again a healthcare investor, but in three years, they won’t be.”

    I hope the skeptics are wrong. It was exhilarating to hear someone talk about mobile technologies that can help patients and doctors do so much more. The doctor will Skype me now? I’m ready.

  • StrictlyVC: April 10, 2014

    Good morning! We’re publishing a little early as we have to hightail it down to Palo Alto for a mobile conference. Before we go: a quick thank you to Sequoia Capital for hosting what seemed like a very successful mixer last night for the media and its startups. We had fun, chatting with old and new friends alike. (The canapés were delish, too.)

    Yesterday was so busy, in fact, that we don’t have a column for you today. We’ll have more good stuff coming your way tomorrow, though. In the meantime, enjoy the intel!

    —–

    Top News in the A.M.

    After a lot of inflated talk from both sides, eBay and shareholder activist Carl Icahn have quietly made friends in a settlement that has Icahn withdrawing his bid for two seats on eBay’s board and ending demands that the company sell a minority stake in PayPal to shareholders. In return, eBay is installing a candidate on the board that both sides have agreed on: David Dorman, the former CEO of AT&T and today, a founding partner with Centerview Capital Technology, a private equity fund affiliated with the investment bank Centerview Partners.

    The Heartbleed hit list: here are the passwords you need to change now.

    JamBase

    New Fundings

    Booktrack, a 3.5-year-old, San Francisco-based company whose technology lets users add a synchronized movie-style soundtrack to an eBook or other digital text content, paced to the individual’s reading speed, has raised $3 million in Series A funding, reports TechCrunch. The round was led by Sparkbox Ventures. The firm’s earlier investors — including Peter Thiel’s Valar Ventures, filmmaker Peter Jackson’s Park Road Post Productions, and others — also participated in the new round.

    Drync, a five-year-old, Boston-based company whose mobile app allows consumers to find, track, share, and purchase wine while they’re drinking it, has raised $2.1 million in seed funding from Cross Link Ventures,Great Oaks Venture CapitalKEC Ventures and Foundry Group, which raised more than $434,000 for Drync through an AngelList syndicate. Hubspot founder Darmesh Shah and ScanScout founder Wakit Lau also participated in the round, which brings the company’s total funding to $3 million.

    Flayvr Media, a 2.5-year-old, Tel Aviv-based mobile gallery app that organizes users’ digital photos and videos, has raised $2 million in new funding from Kaedan CapitalAviv Venture Capital, and several new and former angel investors. The company has raised $2.45 million to date, shows Crunchbase.

    FlexReceipts, a 3.5-year-old, Windermere, Fl.-based company whose software digitizes receipts, enables its customers to manage their returns and exchanges, business expense reports, taxes, and personal finances without involving paper, has closed a $1.4 million in Series A funding led by venVelo, a Winter Park, Fl.-based early-stage venture fund. Other participants in the round included The Florida Institute for Commercialization & Public ResearchFlorida Angel NexusAngel Round TableAngel Street Capital and TiE Tampa Angels.

    Genomind, a five-year-old, Chalfont, Pa.-based personalized medicine company — its saliva-based genetic test is used to inform treatment decisions for patients with depression and other psychiatric disorders — has raised $5 million in Series A funding. The round was led by Claritas Capital and joined by undisclosed investors.

    GreenSQL, a five-year-old, Tel Aviv-based database security company, has raised $7 million in new funding led by Jerusalem Venture Partners. GreenSQL’s existing investors Magma Venture Capital,RhodiumAtlantic Capital PartnersGandyr and 2Bangels also participated in the funding, which brings the total amount it has raised to $14.4 million.

    NuCana BioMed, a 5.5-year-old, Edinburgh, Scotland-based company developing new chemotherapy drugs, has raised $57 million in new funding from Sofinnova Ventures, which also participated in an earlier round in the company. Altogether, the company has raised $67.5 million, including from Morningside Group and Scottish Venture Fund, shows Crunchbase.

    PivotDesk, a two-year-old, Boulder-based online platform that matches startups needing space with hosts that have it, has raised $3.6 million in new funding, shows an SEC filing. The company had previously raised $3 million, including from TechstarsFoundry GroupDraper Associates,David Cohen, and other individuals.

    Racemi, a 13-year-old, Atlanta-based company that sells image-based provisioning software for data center consolidation and disaster recovery, has raised $6 million in new funding, according to an SEC filing. The company raised $13.4 million previously, says Crunchbase, including from Paladin Capital Group and Harbert Venture Partners.

    Savioke, a 10-month-old, Sunnyvale, Ca.-based company that’s creating autonomous robots for the services industry, has raised $2 million in seed funding led by Morado Venture Partners. Other participants in the round included AME Cloud VenturesGoogle Ventures and individual investors. GigaOm has more here.

    Senseg, a nearly eight-year-old, Helsinki-based company whose tactile interface technology generates the feel of virtual buttons on smooth surfaces like cell phones and computer screens, has raised $6 million in Series B funding led by NXP Semiconductors N.V. The round also included earlier investors Ambient Sound Investments and Finnvera Venture Capital.

    Tendyne Holdings, a 3.5-year-old, Roseville, Mn.-based clinical stage medical device company that’s developing products for transcatheter mitral valve replacement, has raised $25 million in Series C funding led by Apple Tree Partners. Other, undisclosed existing investors also joined the round, the company said.

    —–

    New Funds

    Ballast Point Ventures, a 13-year-old, St. Petersburg, Fla.-based venture capital firm providing expansion capital to companies located primarily in the Southeast and Texas, has nearly finished raising a third fund, suggests a new regulatory filing. According to the Form D, Ballast, which listed its target as $140 million, has already raised $115 million. Ballast was founded in 2001 as a joint venture between Raymond James Financial and the principals of South Atlantic Venture Funds. Among its current investments is SleepMed, a West Palm Beach, Fal.-based medical device and software company whose home sleep tests help doctors diagnose obstructive sleep apnea.

    Jafco Ventures, a 10-year-old, Palo Alto, Ca.-based venture firm focused on mid-stage investing, has raised $260 million for its fifth, the firm is announcing this morning. The fund is the outfit’s biggest to date. It also includes outside investors for the very first time — more than 20 or them, in fact. (Jafco Ventures’s single LP until now has been Jafco, the 40-year-old publicly traded venture capital and private equity firm based in Tokyo.) The firm claims the fund was oversubscribed owing to a chain of recent exits, and indeed, there doesn’t seem to be a shortage of them. It had Palo Alto Networks and Proofpoint in its portfolio, both of which have had very successful public offerings. It also backed FireEye, which also went public and that alone produced a 47x return for the company, it says.

    Vertical Venture Partners has held a first close of what is expected to be a $40 million debut fund targeting early-stage enterprise startups coming out of the University of California at San Diego and other spots, reports VentureWire. The firm was founded by David Schwab, a managing director at Sierra Ventures, who will be leaving the firm after an 18-year-long run. Specifically, Schwab, a UC San Diego alum, will be leading a group of other UC San Diego alumni in investing in companies and technologies invented by UC San Diego faculty, students, and alumni, in the areas of software, communications, electronics, materials, medical devices, and instruments. Xconomy also has more on the story, here.

    TrueStart, a months-old, London-based consumer and retail start-up accelerator, has itself raised $5 million in seed funding that it will use to support startups in its program. TrueStart’s 4,500-square-foot “innovation hub” is capable of hosting up to 20 start-ups on a rolling six-month basis, says its founder, Matt Truman, who was previously Global Head of Retail for Lehman Brothers and later Head of European Retail at JP Morgan. Startups will typically receive cash investments of between $40,000 and $80,000 from TrueStart; in turn, TrueStart will take an average 10 percent stake in the company.

    —–

    Exits

    Digital Tutors, a 14-year-old, Oklahoma City, Ok.-based platform company that offers tech and other training online, has been acquired by Pluralsight, which has its own online library of video tutorials, for $44 million in cash and stock. Digital Tutors doesn’t appear to have raised outside funding. Ten-year-old Pluralsight has raised at least $30 million, including via a $27.5 million round from Insight Venture Partners early last year.

    InnLink, a 23-year-old, Hendersonville, Tn.-based company that process reservations for hotels and hotel companies, has been acquired by IHS GmbH, a Frankfurt, Germany-based company whose software is also used by the hotel industry. Terms of the deal weren’t disclosed. InnLink doesn’t appear to have raised outside funding; IHSS was acquired by Battery Ventures last summer.

    Longreads, a five-year-old, Oakland, Ca.-based website and weekly email that draws readers to high-quality long-form stories on the Web, has been acquired by Automattic, the company behind the popular blogging platform WordPress. Terms of the deal aren’t being disclosed, but CEO Matt Mullenweg tells BusinessWeek that Longreads’s staff of four will join WordPress’s editorial team.

    Silverpop, a 15-year-old, Atlanta-based marketing technology company, has been acquired by IBM for undisclosed terms. Silverpop had raised roughly $40 million in recent years, including from D.E. ShawDFJEscalate Capital Partners, and Silicon Valley Bank.

    Uppidy, a three-year-old, Columbia, Md.-based company that lets users securely back up their phone’s texts, photos and videos to the cloud, has been acquired by ArmorText (formerly known as Gryphn), says TechCrunch. Terms of the deal weren’t disclosed, but Uppidy had raised at least $600,000 in seed funding, including from Band of AngelsFortify Ventures, and New Vantage Group. ArmorText, which is focused on secure text messaging for the enterprise, has raised nearly a million in debt and equity, according to Crunchbase.

    —–

    People

    Former New York City Mayor Michael Bloomberg doesn’t buy into the notion that the knowledge economy can help anyone and everyone. Speaking yesterday at the Bloomberg New Energy Finance Summit, Bloomberg said of displaced coal workers, for example, that “You’re not going to teach a coal miner to code.” He added, “[Facebook co-founder and CEO] Mark Zuckerberg says you can teach them to code and everything will be great … I don’t know how to break it to you — but no.”

    The operating days of Mark Cuban — who famously sold his company Broadcast.com to Yahoo in 1999 for $5.9 billion in stock — may not be over. The Dallas Mavericks owner and “Shark Tank” judge has reportedly found the time and motivation to create a potential Snapchat killer called Cyber Dust. Forbes has much more here.

    Fontinalis Partners, a Detroit-based venture capital firm focused on mobile technologies, has promoted three of its staffers to partner: Chris CheeverChris Thomas, and Laura Petterle. Cheever and Thomas cofounded Fontinalis in 2009 with Bill Ford (yes, that Bill Ford). It isn’t a captive venture arm of the car giant, though; it’s very much a standalone entity, Thomas told StrictlyVC last year. The new partners come from fairly divergent backgrounds: Cheever was most recently an investment associate at LaunchCapital and spent more than five years at UBS. Thomas conducted financial and strategic analysis at Ford Motor Company and UBS. He also served in the U.S. Army as a communications officer in Iraq. Laura Petterle, the firm’s long-time CFO, spent the 20 years before Fontinalis serving as the CFO of Booth American Company, a telecommunications and radio broadcasting company founded by Ralph Booth, another Fontinalis founder.

    Doug Mack, who has served as CEO of the online retail site One King’s Lane for the last four years (and was VP at Adobe Systems before that), has just left the company to become the CEO of the sports site Fanatics, the company announced yesterday. Re/code has more here.

    Kelly Porter, a partner at the investment bank and advisory firmWoodside Capital Partners, has put his Los Altos Hills manse on the market again — this time for $27 million. (At 30,000-square feet, the property is enormous even by tech billionaire standards; the Los Altos home of Yuri Milner, acquired for a reported $100 million, is 25,545 square feet.) The building has seven bedrooms and eight bathrooms, a Venetian-inspired ballroom, Italian statuary, custom millwork and gold-leaf ceilings. As Silicon Valley Business Journal notes, there’s also a secret speakeasy on the property that’s accessible through a secret door in the grand library.

    —–

    Job Listings

    VMWare is looking for an associate to join its strategy and corporate development team at its Palo Alto, Ca., headquarters.

    —–

    Data

    Asymco graphs the latest U.S. smartphone ownership data, including comScore and PJC Teen Survey data.

    Mercom Capital Group, a clean energy research firm, has released its newest funding and M&A report for the solar sector. In the first quarter of this year, it says, total global corporate funding in the solar sector — including via venture capital, private equity, debt financing, and public financing — came in at $7 billion, compared with $5 billion in the previous quarter. (It doesn’t say how the data fares compared with the first quarter of 2013.) Most of the money came from outside the private markets. According to Mercom, just $251 million was invested in 26 deals in the first quarter, taking into account VC, PE, and corporate VC alone. You can read more here.

    —–

    Essential Reads

    The secret shame of an unacquired tech worker. “Google agreed to buy the company for a relatively modest amount, then interviewed all five members of the company before extending job offers to everyone but [one]. Making offers to four-fifths of a company as part of an acqui-hire, while legal, is nearly unheard of in Silicon Valley, where mergers and acquisitions are still generally governed by a certain type of decorum.”

    Re/code on the uncertain future of Square.

    BusinessWeek on Dropbox‘s “Chapter 2.”

    Well, this is getting ridiculous. “Jensen Bergman spent weeks preparing to pitch his team’s business idea to investors. Minutes before the meeting, he was playing ping-pong outside the board room to stay calm. Jensen is 9 years old. ‘If they say no, it’s going to be really upsetting for us,’ he said as one of his teammates wheeled up beside him on a tiny scooter.”

    —–

    Detours

    The most painful public service announcement you may ever see.

    The irreplaceable David Letterman.

    Why we still root for Don Draper.

    Matthew’s party. (Classic edition.)

    —–

    Retail Therapy

    BBQ Bath. It’s a marinade, for meat. (Phew.)

    —–

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  • StrictlyVC: April 9, 2014

    Good Wednesday morning, everyone! StrictlyVC is off to a late start, so the newsletter is slightly abbreviated today; if we missed anything major, apologies!

    —–

    Top News in the A.M.

    Amazon is now the third-biggest streaming service after Netflix and YouTube.

    As soaring stocks have fueled a surge in IPOs, signs emerge that investors are beginning to sour on the fresh arrivals.

    —–

    Preempting Others, Tiger Leads $80 Million Round in Quora

    Quora, the question-and-answer platform cofounded roughly five years ago by top Facebook engineers Adam D’Angelo and Charlie Cheever, has just raised a whopping $80 million in new funding led by Tiger Global Management, the 13-year-old Park Avenue-based hedge fund. Its new valuation, reportedly: $900 million.

    The deal marks the third outsize funding that Tiger has led in the last six weeks alone. In March, Tiger led a $77 million growth round in OnDeck Capital, reportedly to fuel the small business lending site’s international and product expansion plans while making it harder for other market entrants to compete. Tiger and T.Rowe Price also plugged $60 million into the online ticketing and event planning company Eventbrite at a valuation of more than $1 billion.

    Tiger and T.Rowe Price had invested a separate, $60 million in Eventbrite in just April of last year, and according to the Wall Street Journal, Eventbrite wasn’t looking to raise more money.

    Tiger’s funding of Quora — which earlier investors Peter Thiel, Matrix Partners, North Bridge Venture Partners and Quora cofounder Adam D’Angelo also joined — sounds like a similar case.

    In fact, other venture firms never really had a chance, suggests Quora’s business head, Marc Bodnick, who left the private equity firm he co-founded, Elevation Partners, to join Quora in January 2011. Quora “wasn’t actually raising money,” he tells me. “In fact, we had most of the money from the last round [$50 million round, closed in 2012] in the bank. But we’d improved the company in the two years since, and Tiger approached us about investing in the company a couple of months ago.” Tiger’s 33-year-old partner, Lee Fixel, was the one to make the call.

    Quora, which has now raised roughly $140 million altogether, plans to do four things with the funding: expand Quora into other languages, à la Wikipedia; create “great mobile products” (its ever-improving email digests are one example); scale up the product technically by hiring more engineers and product managers; and put the rest in the bank. “We want to stay independent and make sure Quora lasts forever,” says Bodnick.

    Given that the company “hasn’t even started to monetize,” according to Bodnick, it might need all that cushioning.

    “Our ultimate goal is to share and grow the world’s knowledge,” he says. “In the last two years, we’ve built the biggest [online] library of first-hand knowledge, and the second-biggest [online] library after Wikipedia of general knowledge.” (It now has material on more than 500,000 topics.)

    While the company’s revenue model is “likely going to be advertising-related” — Bodnick notes that a third of Quora’s traffic is looking for something specific and that its direct intent traffic “should create exciting financial opportunities” — that won’t be the focus for a while. “Right now,” says Bodnick, “the big question is: How do we make the product better and keep scaling it?”

    JamBase

    New Fundings

    Ability Network, a 14-year-old, Minneapolis, Mn.-based health care software company, has raised a whopping $550 million from Summit Partners. The company had previous raised roughly $33 million over several rounds, including from Bain Capital Ventures and Lemhi Ventures.

    AdvanDx, a 12-year-old, Woburn, Mass.-based company that makes molecular diagnostics kits to diagnose and prevent infectious diseases, has raised $12 million in Series B-1 funding led by Merck Global Health Innovation Fund. Earlier investors LD Pensions and SLS Ventures also participated. The company has raised approximately $22 million to date, according to Crunchbase.

    Altia Systems, a three-year-old, Cupertino, Ca.-based company whose main product enables users to participate in video conferencing with panoramic views and other interactive features, has raised $10.5 million in Series B funding led by Intel Capital. The company has raised $17.2 million altogether, including an earlier investment from Naya Ventures.

    Aveillant, a 2.5-year-old, Cambridge, U.K.-based specialist in 3D surveillance radar technology, has raised $9 million in new funding from earlier investors including ESB NovusmodusDFJ Esprit and Cambridge Consultants, from where Aveillandt spun out. The company has raised roughly $21 million to date, shows Crunchbase.

    Crittercism, a three-year-old, San Francisco-based company whose software monitors mobile app performance, has raised a $30 million Series C round led by Scale Venture Partners. Other participants includedInterWest Partners and VMware. The company has raised $48.7 million to date.

    DerbySoft, a 12-year-old, Shanghai-based software company that connects its hotel customers’ central reservations systems with online booking and metasearch sites, has raised $9 million in Series C funding from DCMaccording to China Money Network. DerbySoft previously received $6.5 million in Series A funding from Northern Light Venture Capital in 2009. It received “tens of millions” of Series B funding from Keytone Ventures and Northern Light in 2011.

    EquityNet, an eight-year-old, Fayetteville, Ak.-based business software company and equity crowdfunding platform, has raised $2.1 million from Proton Enterprises and individual angel investors.

    The Flatiron School, a two-year-old, New York-based school that teaches Web application development, has raised $5.5M in funding led by CRV and Matrix Partners, with additional investment coming from Box Group and angel investors.

    GrabTaxi, a 2.5-year-old, Singapore-based smartphone booking and dispatch platform for the taxi industry in South East Asia, has raised an undisclosed amount of Series A funding from Vertex Ventures, a wholly-owned subsidiary of Temasek, an investment company owned by Singapore’s government. The startup confirmed to TechCrunch that the that the investment is more than $10 million. More here.

    Ineda Systems, a three-year-old, Santa Clara, Ca., and Hyderabad, India-based developer of low-power systems-on-a-chip for use in the wearables and the connect-device market, has raised $17 million in Series B funding led by Walden-Riverwood Ventures. Other participants in the round included Samsung Catalyst FundQualcomm VenturesIndusAge Partners and others. The company has raised roughly $26 million to date, shows Crunchbase.

    InfoBionic, a three-year-old, Lowell, Ma.-based company whose device and software for the remote monitoring of patients with cardiac arrhythmia, has closed a first tranche of Series B round that the company says will reach $17 million. The round was led by new investor Safeguard Scientifics. Earlier investors Mass Medical AngelsBroadview VenturesTiEBeta FundLaunchpad Venture GroupCherrystone TCAHTCBoynton and Keiretsu also participated.

    JenaValve Technology, a 7.5-year-old, Munich-based heart-valve replacement maker, has added $10 million to its Series C round from U.K.-based Valiance Asset Management and Belgium-based RMM. Other participants in the round included Atlas VentureEdmond de Rothschild Investment PartnersgimvLegend CapitalNeoMed Management,Omega FundsSunstone Capital and VI Partners. The round now totals $72.5 million, JenaValve said in a release. The company has raised at least $86 million altogether, shows Crunchbase.

    Move Loot, a months-old, San Francisco-based company that’s building a platform to buy and sell used furniture online, just raised about $2.5 million, according to an SEC filing that was first flagged by VentureBeat. The company had participated in Y-Combinator’s winter 2014 class.

    NetBrain Technologies, a 10-year-old, Burlington, Ma.-based company whose software helps engineers map, analyze and troubleshoot enterprise and service provider networks, has received a minority investment from Summit Partners.

    NetProspex, a 7.5-year-old, Waltham, Ma.-based maker of marketing data management software, has raised $13 million in Series C funding led by Spring Lake Equity Partners. The round, which included the participation of earlier investors like Edison Ventures, brings the company’s total capital investment to date to $27 million.

    Omada Health, a three-year-old, San Francisco-based startup that makes digital health therapy programs for people with type 2 diabetes and other serious but potentially treatable issues, has raised $23 million in Series B funding led by Andreessen Horowitz — marking one of the firm’s first big healthcare-related investments. Also participating in the round were Kaiser Permanente Ventures and earlier investors U.S. Venture Partners and The Vertical Group. TechCrunch has much more here on Omada, which has raised $28.5 million to date.

    Ookbee, a three-year-old, Bangkok-based online bookstore, has raised $7 million led by Transcosmos. The financing, Ookbee’s second, values the startup at $70 million, according to Tech In Asia, which notes that the Thai venture firm InVent (formerly Shin Corporation), already owns a 25 percent stake in the company.

    Peerform, a four-year-old, New York-based peer-to-peer lending platform, has raised $1 million in seed funding led by Corporest Development, a European-based advisory and investment firm.

    Updater, a 3.5-year-old, New York-based company behind a relocation and address-change technology, has raised $8 million in Series A funding from SoftBank CapitalSecond Century VenturesIA Ventures, andCommerce Ventures. The company has raised $9.5 million to date, shows Crunchbase.

    —–

    Exits

    Market Metrix, an 18-year-old Larkspur, Ca.-based enterprise feedback management platform for the leisure and hospitality industries, has been acquired by Clarabridge, a Reston, Va.-based “customer experience management” software company backed by roughly $84 million in funding from General Catalyst PartnersSummit Partners, and Yuchen Lee. No financial terms were disclosed.

    —-

    People

    Andreessen Horowitz is warning its portfolio startups against “certain” investors outside Silicon Valley, says the WSJ, basing its report on the recent tweets of Marc Andreessen, who says the firms, which he declines to name specifically, are using term sheets as a starting (rather than an end) point for negotiations and forcing founders to break off talks with other investors. “[The non-Silicon Valley] investor can then renegotiate [the] deal arbitrarily and with impunity since company may be screwed if that investor walks,” he tweeted. “People in SV generally consider this unethical and abusive. Investors from outside SV, though, may consider [it] standard operating procedure.”

    It’s “Silicon Valley” meets “Shark Tank” and “Cash Cab,” says the San Francisco Chronicle (aptly). Today, Google Ventures, in a promotion with its portfolio company Uber, will place six partners in the back seat of Uber cars that will then cruise through Silicon Valley from 11 a.m. to 3 p.m, listening to pitches that entrepreneurs can submit through Uber’s smartphone app. “This sounds like a ton of fun,” said a not-entirely-convincing David Krane to the Chronicle. Krane is general partner at Google Ventures who will be along for the ride.

    Scott Griffith, the former chief executive of Zipcar Inc., has joined General Catalyst Partners as part of its investment team. Griffith spent a decade at Zipcar, leading it through an IPO and its subsequent sale to Avis Budget Group. Earlier in his career, he worked at Boeing.

    It’s all part of what might be called the “credentials caucus,” says the Washington Post, the period before the 2016 campaign when the Republican Party’s presidential aspirants “quietly study up on issues and cultivate ties to pundits and luminaries from previous administrations.” According to the report, Senator Rand Paul, a Republican from Kentucky, has already made several trips to Silicon Valley and spoken “multiple times” to investor-entrepreneur and self-described libertarian Peter Thiel. He has also met separately with Bill Gates.

    —–

    Job Listings

    UC Davis‘s Venture Catalyst, a unit of the university that facilitates the translation of its research and technology into the development of new ventures, is looking for an associate director.

    —–

    Data

    Exitround, a San Francisco-based online marketplace that matches acquirers with potential targets, now features more than 1,200 buy-side companies and 850 sell-side companies in more than 36 countries on its platform — big enough numbers to highlight some trends. Among them, says the company: 43 percent of buyers are outside of the tech sector; 168 of them are large publicly traded corporations; and the average active sell-side company on its platform gets introduced to three new buyers each month. CEO (and former VC) Jacob Mullins has more here.

    —–

    Essential Reads

    Atlassian, a 12-year-old Australian company that makes online collaboration tools for businesses, competes directly with Box. And like Box, it’s among the most richly valued venture-backed startups in the world right now, with a newly established valuation of $3.3 billion. That’s where the similarities stop, says the WSJ.

    India’s biggest e-commerce company, Flipkart, is in the final stages ofcompleting a merger deal with the country’s fast-growing online fashion retailer Myntra, potentially creating a powerhouse far more capable of fending off aggressive rivals AmazonWalmart and the eBay-backed Snapdeal.

    —–

    Detours

    What the heartbleed security bug means for you.

    The restorative power of music. (H/T: Liz Phair.)

    Design Font War: Inside the design world’s $20 million divorce.

    Classic album covers, as seen through Google Street View.

    —–

    Retail Therapy

    Bose’s newly released SoundTrue around-ear headphones, for when you’re ready for an upgrade.

    A checker set that is also a bandana. (We know we let you down yesterday with those horrid jeans. This is recompense.)

    —–

    To sign up for StrictlyVC, click here. To advertise, click here.

  • Preempting Others, Tiger Leads $80 Million Round in Quora

    QuoraLogoQuora, the question-and-answer platform cofounded roughly five years ago by top Facebook engineers Adam D’Angelo and Charlie Cheever, has just raised a whopping $80 million in new funding led by Tiger Global Management, the 13-year-old Park Avenue-based hedge fund. Its new valuation, reportedly: $900 million

    The deal marks the third outsize funding that Tiger has led in the last six weeks alone. In March, Tiger led a $77 million growth round in OnDeck Capital, reportedly to fuel the small business lending site’s international and product expansion plans while making it harder for other market entrants to compete. Tiger and T.Rowe Price also plugged $60 million into the online ticketing and event planning company Eventbrite at a valuation of more than $1 billion.

    Tiger and T.Rowe Price had invested a separate, $60 million in Eventbrite in just April of last year, and according to the Wall Street Journal, Eventbrite wasn’t looking to raise more money.

    Tiger’s funding of Quora — which earlier investors Peter Thiel, Matrix Partners, North Bridge Venture Partners and Quora cofounder Adam D’Angelo also joined — sounds like a similar case.

    In fact, other venture firms never really had a chance, suggests Quora’s business head, Marc Bodnick, who left the private equity firm he co-founded, Elevation Partners, to join Quora in January 2011. Quora “wasn’t actually raising money,” he tells me. “In fact, we had most of the money from the last round [$50 million round, closed in 2012] in the bank. But we’d improved the company in the two years since, and Tiger approached us about investing in the company a couple of months ago.” Tiger’s 33-year-old partner, Lee Fixel, was the one to make the call.

    Quora, which has now raised roughly $140 million altogether, plans to do four things with the funding: expand Quora into other languages, à la Wikipedia; create “great mobile products” (its ever-improving email digests are one example); scale up the product technically by hiring more engineers and product managers; and put the rest in the bank. “We want to stay independent and make sure Quora lasts forever,” says Bodnick.

    Given that the company “hasn’t even started to monetize,” according to Bodnick, it might need all that cushioning.

    “Our ultimate goal is to share and grow the world’s knowledge,” he says. “In the last two years, we’ve built the biggest [online] library of first-hand knowledge, and the second-biggest [online] library after Wikipedia of general knowledge.” (It now has material on more than 500,000 topics.)

    While the company’s revenue model is “likely going to be advertising-related” — Bodnick notes that a third of Quora’s traffic is looking for something specific and that its direct intent traffic “should create exciting financial opportunities” — that won’t be the focus for a while. “Right now,” says Bodnick, “the big question is: How do we make the product better and keep scaling it?”

  • StrictlyVC: April 9, 2014

    Happy Tuesday, everyone!

    —–

    Top News in the A.M.

    Google is today announcing a Glass for Work program to provide additional tools for business users, like tech support, and to explore how to sell Glass to more of them.

    —–

    MobileIron Founder Tae Hea Nahm on the Korea Connection

    Tae Hea Nahm, a founding managing director of the early-stage firm Storm Ventures, was born in Seoul, Korea, and he still spends at least one week in the country every quarter. He goes to attend startup board meetings. He visits with Samsung and with some of Storm’s LPs, including Korea Telecom. Nahm, who has also cofounded four mobile companies — including MobileIron, which filed to go public yesterday — also seeks out new ideas on these trips. We talked yesterday about what he sees.

    You’re in Korea more often than most U.S VCs, I’d imagine.

    Well, I’m Korean, so visiting is relatively easy for me. It also helps me with my mobile investments in the U.S. People who invest in digital advertising look at startups in Silicon ValIey and New York; I feel that Silicon Valley and Korea are naturally synergistic in the same way when your primary [focus] is in on mobile.

    Where do you look for trends?

    I like to ride the subway in Seoul to get an idea of what people do. In New York, for example, most people are listening to music on their mobile devices or maybe reading a Kindle or something because connectivity on the subway is very poor. In Seoul, about a quarter of people on the subway are streaming a drama or sports show on their iPads or Galaxy Notes because they have the Internet infrastructure to do it.

    Mobile video is really going to take off here, too. It’s why a huge investment is being made by Samsung and Apple to create higher resolution displays. It’s why, on the other side, content video providers like Amazon and YouTube and Netflix expect more people to watch their content over mobile devices. It’s also why one company we started in Korea that optimizes your mobile video session across multiple wireless networks is doing very well.

    Other than gaming, where else has Korea gotten a jump on the U.S.?

    An example I saw and didn’t take advantage of are credit card readers. Many years ago, a taxi driver who picked me up basically scanned and processed my credit card with a cellular reader that was like a bigger form of Square. Kakao, the messaging platform, also took off must faster in Korea than messaging took off here in the U.S. In that case, it was mostly driven by cost. In the U.S., the savings of using free messaging here is less compelling than in Europe or Korea. But it also just fits in with human nature.

    How hard is it to separate out what’s an early indicator of a big trend, versus something that might be popular specifically because of the culture?

    It can be difficult. I email with my wife a lot, but in Korea, a husband and wife would rarely email each other; dating back at least 10 years, they’d text each other because email is considered slow and formal whereas texting is faster and spontaneous. There, I felt like texting was more cultural, and my initial assumption was incorrect.

    Are so-called ephemeral apps interesting to the Korean market?

    Yes. There’s a company in Korea, Between, that allows you basically to just create a private social network between two individuals, and either individual can terminate the whole conversation and all the content stored. It’s like a private communication locker, versus a Snapchat, where it’s just a private message.

    Would you try to bring it to the U.S or incubate something similar? You’ve incubated several companies here in the past.

    I’ve started companies like Airespace [acquired by Cisco for $450 million in 2005] where I was the founding CEO and hired the first 24 employees, and MobileIron, where I hired the first three founders. At the same time, we don’t want the reputation of ripping off entrepreneurs’ ideas, so we don’t just form clones.

    Also, the problem in [recreating an idea] is whether the founders you hire will really be passionate about the idea. Passion for their idea is what makes entrepreneurs so special. If I have the belief and desire and the executive team doesn’t have it, it doesn’t work.

    There must also be major differences in the way things are marketed. What are some of the biggest ways the markets in Korea and the U.S. continue to differ?

    Korea is a very small homogenous country, so if five people believe something, everyone will believe it, whereas because the U.S. is so big and diverse that word of mouth is much less powerful. Westeners also like things that are more realistic; Asians like things that are more cartoonish.

    And Koreans like tutorials; they like to go through manuals to teach themselves how to become power users. Americans hate them. They like to push buttons and get results. I don’t know if Apple brainwashed them or understood them, but American users don’t want to read anything.

    JamBase

    New Fundings

    Adaptive Biotechnologies, a five-year-old, Seattle-based company focused on immunosequencing research and diagnostics, has raised $105 million in fresh capital from Viking Global Investors. The Greenwich, Conn.-based hedge fund contributed $5 million to Adaptive’s Series C round, closing it out; it also invested $100 million in a newly created Series D round intended to enable to company to expand globally.

    Alios BioPharma, a 7.5-year-old, South San Francisco-based company at work on a treatment for respiratory syncytial virus, a top cause of brochiolitis, has raised $41 million in funding led by a new, undisclosed investor . Earlier investors Novo VenturesSR OneRoche Venture Fund and Novartis Ventures also participated in the round, which brings Alios’s total funding to $73 million, according to Crunchbase.

    Beamr, a five-year-old, Tel Aviv-based video optimization startup, has raised $9.5 million led by Marker LLC and Innovation Endeavors. The company was formerly known as ICVT.

    Carrot.mx, a two-year-old, Mexico City-based car-sharing service, has raised about $2 million in Series B round led by Venture Partnersreports TechCrunchAuria Capital and earlier investor Mexico Ventures also participated in the round, which brings Carrot’s total funding to $3.5 million.

    Cerora, a 2.5-year-old, Bethlehem, Pa.-based company developing a diagnostic device that aims to diagnose concussions and other head injuries, has raised an undisclosed amount of seed financing, according to the company. It plans to debut its first product later this month at the Annual Meeting of the American Academy of Neurology in Philadelphia.

    Closely, a 3.5-year-old, Denver-based company whose software helps small business monitor the social and mobile behavior of their customers, has raised $3 million in Series A funding led by Grotech VenturesSteadfast Venture Capital and CNF Investments participated

    Datalogix, a five-year-old, Denver-based company that sells offline purchase data to giant publishers, has raised a “significant” amount of fresh capital from billionaire tech investor Jim Breyer, who also joined the company’s board, reports the WSJ. (Others of his personal investments include Etsy, Spotify and the now-public revenue management software company Model N.) Datalogix, formed from an older company and essentially restarted by General Catalyst Partners in 2009, had previously raised $35 million, including from General Catalyst and Institutional Venture Partners.

    EatStreet, a 3.5-year-old, Madison, Wi.-based online and mobile food ordering service, has raised $6 million in Series B funding from Cornerstone Opportunity PartnersIndependence EquityGreat Oaks Venture CapitalCSA PartnersSilicon Valley Bank, and other angels. The company has raised a little more than $8 million to date, shows Crunchbase.

    Hortau, a 14-year-old, Quebec-based company that specializes in wireless and Web-based irrigation management, including through sensors that it installs at various depths in the soil, has raised $3.2 million from earlier investor Avrio Capitalaccording to Dow Jones. The company has raised $6.5 million to date, shows Crunchbase.

    Ioxus, a 6.5-year-old, Oneonta, N.Y.-based maker of ultracapacitor technology for use in transportation, industrial and energy applications, has raised $21 miillion in Series C funding co-led by IFC, a member of the World Bank Group that’s based in Beijing, and earlier investor the Westly Group. Ioxus has raised roughly $70 million to date, shows Crunchbase.

    Kenshoo, a 7.5-year-old, Tel Aviv-based digital marketing technology company, has raised $20 million in new financing led by Bain Capital Ventures. A WSJ source says the latest round set the company’s valuation at between $400 million and $500 million; this source says the company is profitable and earning annual revenue of between $50 million and $100 million. Kenshoo has raised roughly $50 million altogether, shows Crunchbase, including from Tenaya Capital, which led the company’s $12 million Series E round in late 2012.

    Neura, a year-old, Sunnyvale, Ca.-based company that facilitates communications between smart devices in the home, has raised $2 million in funding from Greenhouse Capital Partners, which was joined by SingTel Innov8 VenturesPitango Venture CapitalTriple Point Ventures and angel investors Ben Narasin and Isaac Applbaum. Neura is a graduate of Silicon Valley based accelerator UpWest Labs.

    Quad Learning, a two-year-old, Washington, D.C.-based startup that’s creating new pathways for individuals to earn their bachelor’s degree, has raised $10 million in Series B funding from a mix of investors that includes
    MentorTech Ventures of Philadelphia and student loan guarantor ECMC. Earlier investors SWaN & Legend Venture PartnersNew Enterprise Associates and CNF Investments also participated in the round. The company was founded by Phil Bronner, a former general partner with Novak Biddle Venture Partners in Bethesda, Md.

    Sequent Medical, a 6.5-year-old, Aliso Viejo, Ca.-based medical device company focused on innovating neuromuscular technologies, has raised $20 million in Series D funding led by existing investor Delphi Ventures. The company’s other, earlier investors — Domain AssociatesUS Venture Partners, and Versant Ventures — also participated in the round.

    Vengo Labs, a two-year-old, New York-based company that makes compact, interactive, digital kiosks that run point-of-purchase digital campaigns for companies like Uber, has raised $2 million in Series A funding from Coinstar Founder Jens Molbak, venture capitalist Brad FeldQueensBridge Venture PartnersJoanne WilsonKensington Capital,Vegas TechFundScout Capital and Vector Media. Roughly a third of the financing — $720,000 — came through SeedInvest, an equity-based funding platform for accredited investors.

    Wattpad, a seven-year-old, Toronto-based collaborative-writing community that helps connect new authors with fans and other writers, has raised $46 million in new funding led by OMERS Ventures. Other participants in the round included August Capital and earlier backers Khosla Ventures,Union Square Ventures and Yahoo co-founder Jerry Yang. GigaOm has much more here.

    Wellframe, a three-year-old, Boston-based mobile platform for care management that promises to better engage patients in personalized care plans, has raised $1.5 million in seed funding, including from Athenahealth CEO Jonathan Bush and DFJ cofounder Tim Draper.

    —–

    New Funds

    BVCF, a Shanghai-based growth capital-focused private equity fund specializing in the life sciences industry, has completed a final close of its third fund, raising a total of $200 million, according to China Money Network.

    Psilos Group, the New York-based health-care investment firm, continues to raised its fourth fund, according to SEC filings. The firm’s fourth, main fund has collected $41 million, per the filing, with a target of $400 million. The filing shows the firm is using Emerald Point Capital of New York to help in its fundraising efforts. Psilos’s previous funds were a $300 million fund closed in 2006, a $140 million fund closed in 2001, and a $120 million fund closed in 1999.

    —–

    IPOs

    MobileIron, a 6.5-year-old, Mountain View, Ca.-based company that enables enterprises to manage mobile applications, content and devices for remote workforces has filed for an IPO. The number of shares that will be sold as well as the stock’s pricing terms have yet to be set. The company, which has raised roughly $145 million from investors over the years, is majority owned by a four venture firms, including Storm Ventures, which owns 20.2 percent of the company; Norwest Venture Partners, which owns 19.5 percent; Sequoia Capital, which owns 16.9 percent; andFoundation Capital, which owns 8.5 percent.

    Tuniu, a 7.5-year-old, Nanjing, China-based company that produces organized and self-guided tours, has filed to go public. The company’s principal shareholders include DCM, which owns 23.5 percent of the company; Esta Investments, which owns 16.7 percent; Gobi Partners, which owns 16.4; Sequoia Capital, which owns 13.2 percent; Dragon Rabbit Capital, which owns 9.6 percent; Verne Capital, which owns 6.4 percent; and RS Empowerment, which owns a 5.3 percent stake.

    Yodle, a nine-year-old, New York-based online advertising service for small businesses, is planning an IPO later this year, according to people familiar with the matter. The IPO could raise around $100 million, though the target hasn’t yet been finalized. Yodle has raised $40 million over the years, according to Crunchbase; its backers include Bessemer Venture PartnersDFJ, and Jafco Ventures.

    —–

    Exits

    8thBridge, a 5.5-year-old, Minneapolis, Mn.-based social commerce platform for retailers, has been acquired by Fluid, a still-private, 14-year-old, San Francisco-based company that creates e-commerce sites. The terms of the sale weren’t disclosed. 8thBridge had raised $15.6 million from Trident Capital and Split Rock Partners.

    Cover, a months-old, San Francisco-based Android lock-screen app that lets users choose what to place on their home screen, has been acquired by Twitter. The announcement was made on Cover’s blog and terms of the deal weren’t disclosed. Investor-operator Semil Shah has some interesting thoughts on the deal here.

    Shape Pharmaceuticals, a 5.5-year-old, Cambridge, Ma.-based company that’s been developing a topical histone deacetylase inhibitor, has been acquired by TetraLogic Pharmaceuticals for $13 million in cash, and future payments tied to development and commercialization milestones and eventually product sales. Shape had raised $3 million in funding, including from HealthCare Ventures in Cambridge.

    —–

    People

    Chris Dixon, a partner at Andreessen Horowitz, warns that mobile apps are killing the free Web, making it impossible to compete with Google and Apple.

    —–

    Job Listings

    Decheng Capital, a healthcare and life sciences venture firm in Shanghai City, China, is looking to hire an associate. Fluency in English and Mandarin is a must (as you could probably guess).

    —–

    Data

    Senior analyst Antoine Nivard of iNovia Capital examines the tech investing landscape in Canada. Among his findings: Canada’s startups have never had as much angel and venture capital funding available than they have today. The country sees more deals of increasingly larger size on average. And most of the country’s tech growth owes to Internet companies, versus either mobile or hardware companies, which “remain tiny and slow-growing categories.”

    —–

    Essential Reads

    It had almost $1 billion in funding and ambitions to replace petroleum-based cars with a network of cheap electric models. Instead, Better Place went bankrupt. Fast Company tells its story.

    Uber is testing a courier service in Manhattan, the next step in its long-state goal of become an advanced-delivery service.

    Waze, the Israel-headquartered social mapping startup acquired by Google for $1.15 billion last year, now hints that it was pressured by regional investors to both think small and sell fast.

    San Francisco’s ban on short-term rentals is turning out to have teeth,reports the San Francisco Chronicle. People who rent out space on Airbnb, VRBO and other markets for temporary housing are facing fines by the City Planning Department and eviction on the grounds of illegally operating hotels.

    —–

    Detours

    Quitting apps in iOS can actually worsen battery life.

    The ultimate camping van.

    A dad creates impressive edible art inside his daughter’s lunch boxes.

    —–

    Retail Therapy

    The Boy’s Doodle Book.” For young sons, nephews, and the boss’s kindergartner.

    A “Game of Thrones” infographic that charts the characters’ various affairs across the first three seasons.

    Scratch and sniff jeans. They are a real product.

    ——-

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  • MobileIron Founder Tae Hea Nahm on the Korea Connection

    south-korea-mapTae Hea Nahm, a founding managing director of the early-stage firm Storm Ventures, was born in Seoul, Korea, and he still spends at least one week in the country every quarter. He goes to attend startup board meetings. He visits with Samsung and with some of Storm’s LPs, including Korea Telecom. Nahm, who has also cofounded four mobile companies — including MobileIron, which filed to go public yesterday — also seeks out new ideas on these trips. We talked yesterday about what he sees.

    You’re in Korea more often than most U.S VCs, I’d imagine.

    Well, I’m Korean, so visiting is relatively easy for me. It also helps me with my mobile investments in the U.S. People who invest in digital advertising look at startups in Silicon ValIey and New York; I feel that Silicon Valley and Korea are naturally synergistic in the same way when your primary [focus] is in on mobile.

    Where do you look for trends?

    I like to ride the subway in Seoul to get an idea of what people do. In New York, for example, most people are listening to music on their mobile devices or maybe reading a Kindle or something because connectivity on the subway is very poor. In Seoul, about a quarter of people on the subway are streaming a drama or sports show on their iPads or Galaxy Notes because they have the Internet infrastructure to do it.

    Mobile video is really going to take off here, too. It’s why a huge investment is being made by Samsung and Apple to create higher resolution displays. It’s why, on the other side, content video providers like Amazon and YouTube and Netflix expect more people to watch their content over mobile devices. It’s also why one company we started in Korea that optimizes your mobile video session across multiple wireless networks is doing very well.

    Other than gaming, where else has Korea gotten a jump on the U.S.?

    An example I saw and didn’t take advantage of are credit card readers. Many years ago, a taxi driver who picked me up basically scanned and processed my credit card with a cellular reader that was like a bigger form of Square. Kakao, the messaging platform, also took off must faster in Korea than messaging took off here in the U.S. In that case, it was mostly driven by cost. In the U.S., the savings of using free messaging here is less compelling than in Europe or Korea. But it also just fits in with human nature.

    How hard is it to separate out what’s an early indicator of a big trend, versus something that might be popular specifically because of the culture?

    It can be difficult. I email with my wife a lot, but in Korea, a husband and wife would rarely email each other; dating back at least 10 years, they’d text each other because email is considered slow and formal whereas texting is faster and spontaneous. There, I felt like texting was more cultural, and my initial assumption was incorrect.

    Are so-called ephemeral apps interesting to the Korean market?

    Yes. There’s a company in Korea, Between, that allows you basically to just create a private social network between two individuals, and either individual can terminate the whole conversation and all the content stored. It’s like a private communication locker, versus a Snapchat, where it’s just a private message.

    Would you try to bring it to the U.S or incubate something similar? You’ve incubated several companies here in the past.

    I’ve started companies like Airespace [acquired by Cisco for $450 million in 2005] where I was the founding CEO and hired the first 24 employees, and MobileIron, where I hired the first three founders. At the same time, we don’t want the reputation of ripping off entrepreneurs’ ideas, so we don’t just form clones.

    Also, the problem in [recreating an idea] is whether the founders you hire will really be passionate about the idea. Passion for their idea is what makes entrepreneurs so special. If I have the belief and desire and the executive team doesn’t have it, it doesn’t work.

    There must also be major differences in the way things are marketed. What are some of the biggest ways the markets in Korea and the U.S. continue to differ?

    Korea is a very small homogenous country, so if five people believe something, everyone will believe it, whereas because the U.S. is so big and diverse that word of mouth is much less powerful. Westeners also like things that are more realistic; Asians like things that are more cartoonish.

    And Koreans like tutorials; they like to go through manuals to teach themselves how to become power users. Americans hate them. They like to push buttons and get results. I don’t know if Apple brainwashed them or understood them, but American users don’t want to read anything.

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