StrictlyVC: February 9, 2016

Hi, everyone, happy Tuesday!

We had a great time last night at the Crunchies, the entirety of which you can catch here if you missed it. The event’s host, actor and comic Chelsea Peretti, pretty much killed it, especially in her opening act. Jordan Crook of TechCrunch, who’s hilarious and did bits from the audience all night, did a fantastic job, too.


Top News in the A.M.

Parker Conrad, cofounder of high-flying Zenefits, was elbowed out of his position as CEO, and even off the company’s board, Zenefits announced in an announcement late yesterday. David Sacks, who’d cofounded and sold Yammer before joining Zenefits as COO about 14 months ago, is now CEO, and he sent a memo to employees of the online health benefits manager didn’t paint a pretty picture of Conrad’s leadership. Acknowledging attacks the company has come under of late for missing its revenue projections and the problems it has encountered with regulatory agencies, Sacks wrote that Zenefits’s “internal processes, controls, and actions around compliance have been inadequate, and some decisions have just been plain wrong.”

Three-and-a-half-year-old Zenefits was valued at $4.5 billion during its most recent funding round, last May. That round was led by Fidelity, which went on to slash the value of its investment in the company by nearly 50 percent in November. Business Insider has more here.


For DFJ, a Quick Close on Fund XII

DFJ, the 31-year-old, Sand Hill Road venture firm, is announcing a new, $350 million fund this morning — the firm’s 12th early-stage vehicle.

We chatted with managing director Josh Stein yesterday about the effort, which he says took about two months from start to finish.

The biggest takeaway: Expect more of the same from the firm, which typically plugs between $10 million and $15 million into its startups; has six investment partners, including firm cofounder Steve Jurvetson; and has become known, largely owing to Jurvetson’s bets, as an outfit willing to gamble on companies that are little out there — sometimes literally.

Among the firm’s many Jurvetson-led investments: the rocket company SpaceX, the satellite company Planet Labs, and the electric car company Tesla Motors. Indeed, Jurvetson accepted a Crunchie award on behalf of SpaceX at last night’s Crunchies awards ceremony. The company won for the category of best technology achievement for its two-stage rocket, the Falcon 9, which was designed to transport satellites and SpaceX’s own Dragon spacecraft into orbit.

Stein wouldn’t talk yesterday about the internal rate of return of any of the firm’s previous funds. He did say DFJ’s last fund — a $325 million vehicle closed exactly two years ago — has backed an as-yet-undisclosed autonomous transportation startup that “we think could be the biggest company we’ve ever been involved with.”

More here.


New Fundings

CognitiveLogic, a five-month-old, U.K.-based analytics startup that wants to join raw data between multiple companies to gain insights from the combined datasets, has raised $3 million in seed funding from Upfront Ventures and IA Ventures. TechCrunch has more here.

Digital Shadows, a 4.5-year-old, London-based company whose SaaS service helps businesses wanting to monitor and manage potential risks by keeping tabs on their digital footprint, has raised $14 million in Series B funding led by Trinity Ventures. Paladin Capital Group also joined the round, along with earlier investors Storm Ventures, TenEleven Ventures and Passion Capital. TechCrunch has more here., a 4.5-year-old, San Francisco-based cloud-based message queue and processing platform for building distributed cloud applications, has raised $3.5 million in new Series A funding from Sapphire Ventures, bringing its total round to $11.5 million. Earlier participants in the round include Baseline Ventures, Bain Capital Ventures, Divergent Ventures, Ignition Partners and Cloud Capital Partners.

Stash, a 5.5-year-old, New York-based digital investment advisor that targets millennials, has raised $3 million in seed funding led by Goodwater Capital, with participation from Valar Ventures and Entrée Capital.

SwervePay, a 5.5-year-old, Chicago-based payment platform that enables patients to pay medical bills with a text message, has raised $10 million in Series B funding led by Garland Capital Group, with participation from KGC Capital, Mandell Ventures and individual investors. More here.

ThinkingPhones, a Cambridge, Ma.-based cloud service that offers messaging, phone service and video streaming, has raised $112 million in new funding led by Summit Partners with participation from earlier investors Bessemer Venture Partners and Technology Crossover Ventures. The company, which is being renamed Fuze, has now raised nearly $200 million altogether. TechCrunch has more here.

Trifacta, a 3.5-year-old, San Francisco-based company that cleans up enterprise data to make it more useful, has raised $35 million in new funding from Cathay Innovation, with participation from Accel Partners, Greylock Partners and Ignition Partners. VentureBeat has more here.

Vast, a 14-year-old, Austin, Tex.-based data-as-a-service platform for vehicles and real estate, has raised $14 million from Capital One Growth Ventures. Vator has more here.

Woo, a new, San Francisco-based startup whose online platform invites tech talent to gauge their own market value, has raised $2.35 million in seed funding from Hank Vigil and Fritz Lanman from Acequia capital, both early investors in Pinterest and Square; Lord David Alliance; and Moshe Lichtman of Israel Growth Partners. More here.


New Funds

Harmony Partners, an eight-year-old, New York and Menlo Park, Ca.-based venture firm focused on expansion-stage companies, is looking to raise $100 million for its third fund, shows a new SEC filing that states the first sale has yet to occur. The firm closed its second fund with $85 million in late 2014.

RWE, Germany’s second-biggest utility, is creating a $140 million clean tech venture fund. GreenTech Media has more here.



Apellis Pharmaceuticals, a 6.5-year-old, Louisville, Ky.-based developer of immunotherapies, has withdrawn registration for an $86.25 million IPO. It didn’t cite a reason.



Lulu, a mobile app that lets women anonymously review and rate men, has been acquired by the London-based dating platform Badoo for undisclosed terms. According to CrunchBase, Lulu had raised $3.5 million from investors, including Passion Capital of London. Badoo has meanwhile raised roughly $30 million, including from the Moscow-based fund Finam Global. TechCrunch has the story here.



Verizon has reportedly authorized AOL CEO Tim Armstrong to kick Yahoo’s tires, says Bloomberg.

Early-stage venture firm Benchmark has added a sixth general partner to its roster: 35-year-old Scott Belsky, a former Goldman Sachs associate who went on to cofound the New York company Behance, an online platform for graphic designers, illustrators, photographers, web designers, and art directors to showcase their skills that Adobe acquired in 2012 for more than $150 million in cash and stock. TechCrunch has more here.

DataGravity, a startup focused on securing stored corporate data against hacker attacks and other threats, is cutting an undisclosed number of jobs, Fortune reported yesterday. The company has raised $92 million from investors, including CRV, General Catalyst Partners, Accel Partners, and Andreessen Horowitz.

Another bombshell CEO switcheroo, this one from Fortune: Adam Marchick has stepped down as CEO of Kahuna, the mobile marketing automation company he co-founded four years ago.  Board member Charles Hudson, managing partner of Precursor Ventures, will serve as interim CEO as the search proceeds for a full-time replacement. More here.

Alphabet has quietly granted Sundar Pichai, chief executive of the company’s main Google business, an equity award valued at nearly $200 million, making him one of the world’s highest-paid executives. The WSJ has more here.



AngelList, the early-stage fundraising and recruiting platform, says it closed out last year having raised $163 million online on behalf of 441 companies. That’s about 56 percent higher than the year before in 2014. More here.


Essential Reads

Amazon is building a global delivery business that aims to bypass Fedex and UPS altogether.

Twitter has revealed video ads to run atop your timeline.



The Bloomberg job skills report 2016: What recruiters want.


Retail Therapy

Birthday balloons for jerks.

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