StrictlyVC: February 10, 2016

Hi, everyone!

We’ll be at the SaaStr Annual conference today; hope to see some of you there.:)


Top News in the A.M.

Twitter announced earlier today that it’s inserting more tweets at the top of the timeline that a user missed while away. The WSJ has more here.


Doomed-i-corns: Unicorns Reach a Tipping Point

This morning, the law firm Fenwick & West published new findings about all the U.S.-based unicorn financings that took place during the last nine months of 2015. It’s rife with interesting nuggets, but perhaps most fascinating is that in the fourth quarter of last year, half of the 12 rounds it tracked featured valuations in the $1 billion to 1.1 billion range — and terms that were far more onerous than earlier in the year.

Fenwick & West politely suggests these companies may have been “willing to be more flexible” regarding “investor friendly terms” in order to attain their billion-dollar-plus valuations. We’d call the behavior bone-headed.

The instinct is understandable, to a degree. For the last couple of years, the media has been almost singularly obsessed with companies valued at north of a billion dollars. Some management teams invariably concluded that to attract the attention of reporters and even potential recruits, they needed so-called unicorn status.

Slack is among them. CEO Stewart Butterfield told Fortune in January of last year that if he couldn’t get a billion-dollar valuation straightaway for his company, he wouldn’t raise capital at all, saying the valuation was a “psychological threshold” for “certain types of customers” who want the “comfort of knowing we’re highly valued and financially secure.” Butterfield said the valuation helped with hires, too. “There is a class of employees who are more risk-averse and work at some company like Google or Facebook and they have a mortgage and kids,” he told Fortune. “It helps a lot of those kinds of people as well.”

Well, it does until it doesn’t.

More here.


New Fundings

ARMO BioSciences, a four-year-old, Redwood City, Ca.-based maker of an immuno-oncology drug that can be used on its own or with other therapies, has raised $50 million in Series C funding including from Celgene Corp., Clough Investment Partners, GV, HBM Healthcare Investments, Industrial Investors Group, and earlier backers DAG Ventures, Kleiner Perkins Caufield & Byers, NanoDimension, and OrbiMed Advisors. The company has now raised $100 million altogether. More here.

CrunchBase, an 8.5-year-old, San Francisco-based analytics company spun out of AOL/Verizon last fall, has raised $2 million in Series A2 funding from Salesforce Ventures, Felicis Ventures, Cowboy Ventures, SV Angel, and 8 Partners, as well as a number of undisclosed private investors. The company had earlier raised an undisclosed round of Series A funding (that we were told was between $5 million and $7 million) led by Emergence Capital Partners. TechCrunch has more here.

Edyn, a 2.5-year-old, Oakland, Ca.-based smart soil and irrigation system maker, has raised $2 million in seed funding led by Fenox Venture Capital, with participation from Idea Bulb Ventures, Morningside Group, Indicator Ventures and individual angel investors. Venture Capital Dispatch has more here.

Gjirafa, a 2.5-year-old Albanian search engine, has raised $2 million Series A round led by San Francisco and Prague-based Rockaway Capital. TechCrunch has more here.

Lantern, a 3.5-year-old, San Francisco-based mental health startup that offers tools to deal with stress, anxiety and body image, has raised $17 million in Series A funding led by the University of Pittsburgh Medical Center’s venture arm, with participation from earlier backers, including Mayfield andSoftTechVC. TechCrunch has more here.

Latch, a 1.5-year-old, New York-based smart access system that works for enterprise, consumer, and hospitality users, has raised $10.5 million in Series A funding led by Lux Capital, with participation from Primary Venture Partners, Corigin Venture Partners, Camber Creek, Expansion VenturesPCH, and Wan Li Zhu of Fairhaven Capital, along with a group of large (unnamed) real estate funds. The company has raised now raised $16 million altogether. TechCrunch has more here.

Paytm, a 5.5-year-old, Noida, India-based mobile payments and e-commerce business that’s backed in part by Alibaba and is one of the bigger startups competing against Amazon in India, is raising money again, just months after a reported $680 million round. TechCrunch sources close to the company say that Paytm is now looking to raise $400 million by June to help with the launch of its new payments business, Paytm Payment Bank. More here.

Riskified, a 3.5-year-old, Tel Aviv, Israel-based e-commerce fraud prevention startup, has raised $25 million round led by Qumra Capital, with participation from The Phoenix Insurance CompanyNTT DOCOMO Ventures, and earlier backers Genesis Partners and Entrée Capital. More here.

TiZR, a 1.5-year-old, London-based startup behind a social video streaming app, has raised $500,000 in funding led by the record label Spinnin’ Records. TechCrunch has more here.

WorldRemit, a 5.5-year-old, London-based startup competing in the lucrative remittance market, has raised  $45 million in fresh funding in a debt round from TriplePoint Venture Growth BDC Corp. and Silicon Valley Bank. TechCrunch has more here.

Yumanity Therapeutics, a 14-month-old, Cambridge, Ma.-based company working to advance treatments for diseases such as Alzheimer’s and Parkinson’s, has raised $45 million in Series A funding led by Fidelity Management, with participation from Alexandria Venture InvestmentsBiogen, Dolby Family Ventures, Redmile Group, and Sanofi-Genzyme BioVentures. Boston Business Journal has more here.



Software maker Opera has received a $1.2 billion buyout offer from a consortium of Chinese Internet firms, the company announced earlier today. The consortium includes Kunlun and Qihoo 360 and is backed by the investment funds Golden Brick and Yonglian. Opera’s board is reportedly recommending the deal. ZDNet has more here.



You may have heard; investor and Twitter enthusiast Marc Andreessen offended a lot of Indians with a single tweet yesterday. He apologized this morning, on Twitter.

Doug Pepper, a former general partner at InterWest Partners, has left the firm after 15 years to join Shasta Ventures. According to Deborah Gage of VentureWire, Pepper’s departure follows a decision by InterWest last year to split its medical and technology groups and focus solely on investing in health-care companies. Pepper invests in IT companies whose software helps businesses improve their relationships with customers.


Essential Reads

Twenty-First Century Fox, which invested $160 million in the daily fantasy sports startup DraftKings last summer, has written down the investment by about 60 percent, according to a 10-Q filed yesterday. Specifically, Fox noted that “based on information concerning DraftKings’ current valuation in a recent financing transaction, the Company determined that a portion of its investment in DraftKings was impaired and recorded a loss of approximately $95 million…” TechCrunch has more here.



Funny or Die has made a Trump biopic, starring Johnny Depp.

If Jane Austen got some feedback from some guy in her writing workshop.


Retail Therapy

Van Gogh’s bedroom: Available for rent on Airbnb.

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