• Nirav Tolia Charged with Felony Hit-and-Run Involving Executive Recruiter

    Nirav ToliaIn late October, Nirav Tolia had reason to celebrate. The CEO of Nextdoor, a four-year-old, San Francisco-based social network for neighbors, had just raised $60 million in a financing led by Kleiner Perkins Caufield & Byers and Tiger Global Management — a round that brought the company’s funding to roughly $100 million.

    “We didn’t go out looking for money,” Tolia told Dealbook at the time. “To some extent the guys who were interested wouldn’t take no for an answer.”

    Yet a misstep two months earlier now threatens to cast a shadow over Tolia and the company. Specifically, Tolia is facing criminal charges over accusations that he caused a collision on Highway 101 in San Mateo County south of San Francisco on August 4th of last year. Self-employed executive recruiter, Patrice Motley, says it was then that, through aggressive maneuvering, Tolia caused her black Honda to spin across two lanes of traffic before hitting a concrete median and coming to rest in the fast lane of oncoming traffic.

    Motley has since hired Brent, Fiol & Nolan, a San Francisco personal injury law firm, and filed a civil suit against Tolia. The firm’s complaint alleges that Motley suffered neck and back injuries, fracture of bones in her left hand, and post-traumatic stress disorder, all of which have rendered her incapable of accomplishing routine tasks necessary for independent living and seriously impacted her ability to earn a living. (You can see the lawsuit, filed earlier today, here, along with the CHP report.)

    San Mateo County District Attorney Steve Wagstaffe is also now pursuing a felony hit-and-run charge against Tolia for leaving the scene of the crash.

    Tolia said in an email, “I just learned about these allegations and will cooperate fully with authorities. This is a personal matter that happened last August and is not related to Nextdoor.”

    Meanwhile, I spoke earlier today with Joseph Brent, Motley’s attorney, about Motley’s version of events. He said Tolia, driving behind another car that was driving at a comparatively slower speed, veered into Motley in the adjacent lane in an attempt to get in front of the slower car. Motley “honked at him but he apparently didn’t hear [the honking] and didn’t realize he was [about to crash into Motley] until his wife informed him that he was about to hit a car. But it was too late and Patrice lost control of her car.”

    Tolia then “fled the scene,” said Brent. “If it weren’t for concerned citizens who watched what happened, and took down his license number, no one would have known who caused the car accident.”

    He added that Motley was “was left in harm’s way in the fast lane with cars rushing toward her at a high rate of speed. She was terrified.”

    Asked why Motley is filing a civil suit against Tolia now, roughly nine months after the accident, Brent said that “some of it has to do with confidential settlement communications with Mr. Tolia” and declined to comment further. Asked why San Mateo’s District Attorney is just now filing charges, he said, “I have no idea why the [D.A.] chose to file today, but I know why we filed today. The time was now. There was no reason to delay.”

    Asked if Motley has been involved in a lawsuit before, Brent told me he doesn’t know. But he quickly painted a picture of a model citizen who has an undergraduate and master’s degree from Michigan State, has worked as an adjunct professor at both UC Berkeley’s extension program and at SF State, is “very active in her community,” and was even “a candy striper.”

    In a police report filed by CHP investigators in the accident’s immediate aftermath, Tolia — who was cited for “making an unsafe lane change” — said he saw only part of what had happened. He told investigators that he saw Motley’s car spin out in front of him but he didn’t see it hit the median. According to that police report, Tolia “added that he did not call law enforcement because he was certain that someone had called. He also stated that he was in ‘shock’ and did not know what to do.’”

    As longtime Silicon Valley watchers will know, this new lawsuit isn’t the first to involve Tolia. Earlier in his career, he was caught lying on his resume and forced to resign from Shopping.com, a bubble-era company that went public and was later acquired by eBay. Early employees of the company, which was originally called Epinions, had sued Tolia and Shopping.com backers Benchmark Capital and August Capital, alleging they’d conspired to deprive them of tens of millions of dollars in the sale. EBay later settled the suit, and Benchmark, which has remained an ardent supporter of Tolia over the years, brought Tolia aboard as an entrepreneur-in-residence.

    Benchmark was among a long line of top firms to pile into Nextdoor’s first big institutional round, an $18.6 million funding closed in July 2012.

    Tolia is to appear May 29 in San Mateo County Superior Court in the criminal matter.

     

    Connie

  • StrictlyVC: May 14, 2014

    It is Wednesday, fine readers! Hope you have a stellar day. StrictlyVC is a little under the weather, so apologies in advance if there’s a higher-than-usual number of typos. We blame the cold medicine.

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    Top News in the A.M.

    Twenty-eight CEOs representing companies that provide Internet service to a majority of Americans sent a letter to the FCC yesterday, warning the agency against adopting more regulations of broadband lines.

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    Hunter Walk on Thinking Longer Term

    It seems like yesterday that Hunter Walk and Satya Patel officially closedtheir first $35 million venture fund, but it was actually early last summer. And in the life of a seed-stage firm like Homebrew — where Walk and Patel have two-thirds of their capital reserved for follow-on investments — that’s an eternity.

    No wonder Walk – who previously worked for nine years at Google – and Patel – who logged a decade at Google, Battery Ventures, and Twitter – are already thinking about what a second fund might look like. Walk and I talked about it last week over a burger at a San Francisco eatery. Our conversation has been edited for length.

    You say you focus on the “bottom-up economy,” services and tools that make it possible for small players to compete with big companies, including, more recently, looking at bitcoin as a bottom-up currency; 3D printing as bottom-up manufacturing; and drones as bottom-up satellites. How else does Homebrew distinguish itself?

    We didn’t create Homebrew to create more noise in a crowded marketplace. We felt there was still a pretty small number of seed-stage funds that will be around for a long time, that have been started by former operators, and that want to take front-of-the-round positions.

    Why makes you better positioned than some?

    First, having a partner who has done venture before [is a big advantage]. There’s also a set of best practices and certain frameworks and models that we’ve thought about in advance — such as [around] what cash flow and portfolio management look like — that sometimes folks who’ve only come from an operating background or angel investor background don’t really understand.

    You’ve told me you could have raised more money last year. Will you go bigger the next time and will we see a third partner?

    That’s something we’ve discussed only lightly and I don’t think we’d do it in the near future. In some ways, we started Homebrew because we didn’t want to join existing funds . . . And so it’s this ironic situation where, if we were to try to find a third or fourth partner down the road, would we suddenly be the incumbent? How would we attract an entrepreneurial VC versus someone who just sees us as an existing fund? So we have to think about all that.

    I think the incentives are to raise more money, [between] management fees, ego, and deal flow optionality – you get exposed to a lot of things you want to invest in. But we’re not doing this to [eventually] raise a $500 million multistage fund or become a 12-partner business that builds out shared services and competes with billion-dollar funds. We know firmly which side of the [investing] barbell we want to be on.

    Roughly one year into this endeavor, what’s been the biggest surprise?

    With venture — and I think it’s one of the reasons I write so much, working through my own learnings – the fund cycle is long. Satya just saw two exits from companies he invested in at Battery in 2007 and 2008. So you want to bring a sense of urgency every day, to lean in and help [your startups], but you also have to manage your own energy and keep the founders who are burning hard every day in the right frame of mind.

    How?

    By making their lives simpler [and doing what you can] to clear the road ahead. We also ensure boards are formed with an outside board member. Most seed investors don’t ask for a board seat and don’t care if there’s an outside board member. We care a lot, not because we want control but because we want first-time founders to build confidence and a management cadence and, when it comes time to raise a Series A, signal to other investors that theirs is a company that’s been operating with some maturity.

    You don’t need a bunch of people around the table. But having worked for strong founders [at Google and Twitter] and seen the benefit of founder-driven companies — not just in year one but in year 10 — we want folks who are building something that, in their head, will be around a while. And our job is to help prepare them for that, because it’s not easy.

    dropcam_300x250_learn

    New Funds

    AdSame, a 4.5-year-old, Shanghai-based digital marketing service that offers online media planning, performance monitoring, evaluation and more for a variety of customers, has raised $30 million in new funding led by Pacific Venture Partners and Dream Capital Group, reports TechNode. Earlier investors, including Matrix Partners and Vertex Ventures, also participated. AdSame has raised at least $50 million to date.

    Agiliance, a nine-year-old, Sunnyvale, Ca.-based maker of security risk management software, has received $5 million in funding from the specialty finance firm Wellington Financial. The company has raised $24 million altogether, shows Crunchbase, including from Intel Capital, Walden International,Red Rock Ventures and Castile Ventures.

    Attensity, a 14-year-old, Salt Lake City, Ut.-based company whose software detects consumer sentiment by sifting through structured and unstructured data, has raised $90 million in new funding. The funding comes from what the company describes in a release as simply an “international private equity fund” and that VentureWire is reporting is earlier investor Aeris Capital AG, the investment vehicle of SAP AG co-founder Klaus Tschira. Attensity has raised $148 million altogether.

    BodeTree, a 3.5-year-old, Tempe, Az.-based company whose online financial analytics dashboard aims to help small owners better understand their finances, has raised $2 million in Series A funding led by Greenline Ventures, a Denver-based investment firm. Other, undisclosed angels also participated in the round.

    Boxed, a year-old, New York-based company whose smartphone app allows users to order consumer packaged goods in bulk (with two-day free delivery), has raised $6.5 million in Series A funding led by Greycroft Partners, First Round Capital and Signia Venture Partners. Other investors to participate in the round included ENIAC Ventures, Social Starts, BoxGroup, former Facebook COO Owen Van Natta and former Zynga COO David Ko.

    Bunkr, a 2.5-year-old, Upper Normandy, France-based maker of software presentation tools, has raised $1.4 million from Idinvest Partners, along with individual investors Daniel Marhely and Xavier Niel. TechCrunch has more here.

    Ceterix Orthopaedics, a four-year-old, Menlo Park, Ca.-based maker of surgical tools for arthroscopic procedures, has raised $18 million in new financing led by earlier investors Novo A/S, Versant Ventures and 5AM Ventures. The round also included an unspecified amount of debt financing from Silicon Valley Bank and Oxford Finance.

    Ditto Labs, a two-year-old, Cambridge, Ma.-based photo-analytics startup created by a team of MIT-trained computer scientists, has raised $2.2 million in seed funding from various individual investors, including Anthony Tjan, managing partner of Cue Ball Group; John Battelle, executive chairman of Sovrn Holdings; David William Baum, partner at Stage 1 Strategies; Nicholas Negroponte, co-founder MIT Media Lab; and Mike Sheehan, CEO of The Boston Globe.

    Life360, a 5.5-year-old, San Francisco-based company whose mobile application securely connects family members and close friends in case of an emergency, has raised a $25 million strategic round of investment from the publicly traded home security giant ADT. The money represents the first tranche of a $50 million Series C round slated to close within the next month, reports VentureWire. The round will push the startup’s total funding to $76 million from roughly two dozen investors, including DCM,Bessemer Venture Partners, Seraph Group, 500 Startups and Kapor Capital.

    Pro.com, a year-old, Seattle-based startup whose online platform provides users with instant, real-time estimates for any home project (then helps them schedule appointments with home improvement professionals), has raised $3.5 million from investors, with another round likely to follow, reports Geekwire. The company’s backers include Madrona Venture Group, Andreessen Horowitz, Redpoint Ventures,Two Sigma Ventures, Sherpa Foundry and Bezos Expeditions.

    ResponseTap, a six-year-old, Manchester, England-based company that sells voice-centric marketing technology and advanced visitor-level call-tracking, has raised roughly $6.7 million in Series B funding from Beringea and Eden Ventures. The company has raised $9.3 million to date, shows Crunchbase.

    Sift Science, a 2.5-year-old, San Francisco-based cyber security startup that uses machine learning to sniff out credit card fraud, has raised $18 million in Series B funding led by Spark Capital, with participation from Union Square Ventures, First Round Capital, and Max Levchin. The company, founded by former Google engineers, has raised $23.5 million altogether.

    SolveBio, a year-old, New York-based company that wants to make it simpler for developers to integrate genomic data into their applications, has raised $2 million in seed funding. The round was led Andreessen Horowitz, which was joined by SV Angel and numerous individual investors, including the founders of Flatiron Health, a company that last week announced a $130 million Series B round led by Google Ventures.

    YouEarnedIt, a 2.5-year-old, Austin, Tx.-based software platform that encourages employees to recognize the good work of their colleagues and give them “props” that their employers can see, has raised $1.5 million in funding from Capital Factory and WPP, the publicly traded advertising giant. (Founder Kenny Tomlin sold his digital ad agency, Rockfish, to WPP Digital in 2011, though he remains CEO of the company.)

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    New Funds

    Sierra Ventures, the 32-year-old, San Mateo, Ca.-based early-stage venture firm, has closed its Fund X at $145 million — less than half the size of its $400 million ninth fund, which closed in October 2006, reports VentureWire. That ninth fund required five months of fundraising; the firm began fundraising efforts for its new fund, which originally had a $200 million target, in December 2011.

    Unsurprisingly, the firm has seen personnel shifts. Partners Vispi Daver and Robert Walker are long gone, for example. Last year, the firm also brought in Al Campa, the former chief marketing officer for Taleo Corp. (sold to Oracle in 2012) as a partner, but his title has since changed to entrepreneur-in-residence.

    Going forward, reports VentureWire, managing directors Tim Guleri, Mark Fernandes, Ben Yu and partner Aaron Tong will invest from the new fund. Three other managing directors — Steven Williams, Peter Wendell and David Schwab — will manage their existing investments alone as they move on to other things.

    Schwab, for one, has already revealed his next steps, announcing the founding last month of Vertical Venture Partners, a fund that will invest in the companies and technologies invented by UC San Diego faculty, students, and alumni. Xconomy had more on the story here.

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    Exits

    Meh Labs, a 2.5-year-old, Palo Alto, Ca.-based company whose mobile messaging app, Blink, lets users share self-destructing messages, has been acquired by Yahoo for undisclosed terms, reports TechCrunch. The company’s seven employees will join Yahoo and the app will be shut down. Meh Labs had raised $1 million in seed funding from Triple Point, New Enterprise Associates, AngelPad, and numerous angel investors.

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    People

    Age 30 and younger: The 14 rising stars in Silicon Valley who “find hot startup deals and invest millions.”

    Nathalie De Clercq, a founding partner at WipLabs Designs, a New York-based e-commerce businesses, is suing People magazine for incorrectly identifying her in a photo as Amanda Rosenberg, the alleged mistress of Google co-founder Sergey Brin. In papers filed in Manhattan Supreme Court, De Clercq says People ran a picture of her wearing Google Glass while on a bike ride in Central Park, a mistake that has turned her into “a laughingstock,” her attorney tells the New York Daily News. De Clercq has further been “handicapped by being the object of ridicule and derision,” says the attorney. “Her reputation has been harmed and it’s difficult for her to go on with her life.”

    Mark Heesen — who long led the efforts at National Venture Capital Association, first as its head of public policy for eight years beginning in 1991 and then as its president for 14 years, beginning in 1999 — was given a lifetime achievement award by the organization yesterday at its VentureScape conference. Heessen “served on the front lines of some of the biggest public policy debates of the last two decades, and his leadership cemented NVCA has an authoritative and go-to credible resource inside the beltway,” NVCA chair Josh Green said in a statement afterward.

    Venture capitalist Vinod Khosla, who is becoming known to many as themogul at the center of a lawsuit over public access to Martin’s Beach in San Mateo County, Ca., testified Monday that he didn’t recall details about his decision to deny public access to the once-popular beach, where he owns a roughly $40 million property. Khosla, who took the stand for an hour and 14 minutes, repeatedly said he didn’t remember seeing certain documents, including one from a judge saying he would need approval to close off access to the beach.

    Anthony Noto, who’d become one of Goldman Sachs‘s highest-profile investment bankers and is widely credited with landing the Twitter IPO, has left the bank to join the hedge fund Coatue Management. Dealbook has much more on Noto’s move — and what it means for both Goldman and Coatue — here.

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    Job Listings

    Funding Circle, the venture-backed online marketplace that allows individuals to lend money to small and mid-size businesses, is looking for a business development analyst in San Francisco.

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    Happenings

    VetsinTech, a nonprofit made up of tech investors and military veterans who train, connect, and find jobs for veterans interested in tech careers, will gather together roughly 60 veterans today at the offices of Next World Capital in San Francisco for an inaugural VetCap workshop. VetCap is a new initiative to help train veterans who are entrepreneurs on where and how to raise capital, and to connect them to a network of financing sources. More information here.

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    Data

    Why consumer metrics are all terrible.

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    Essential Reads

    This company promises email that can self-destruct in five seconds.

    Apple’s iPad may soon feature a new split-screen multitasking feature, according to the outlet 9to5Mac. The feature will reportedly allow iPad users to run and interact with two iPad applications at once.

    Skype’s co-founder Janus Friis is looking to take on Fitbit with a new data-heavy health and wellness-focused wearable device, and he’s assembled a high-profile team for his stealth startup dubbed Project Florida toward that end. GigaOm has more here.

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    Detours

    Deciphering social media with charts.

    Why we favorite tweets.

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    Retail Therapy

    Fuselage wall clocks.

    You can now buy Google Glass, as long as you live in the U.S.

    If you enjoy whiskey and pork, you’ll love reading what a distillery in Iowa is doing. (Or not.) H/T: Marc Andreessen

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

    Connie

  • StrictlyVC: May 13, 2014

    Good Tuesday morning, everyone!

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    Top News in the A.M.

    Internet companies can be made to remove irrelevant or excessive personal information from search engine results, Europe’s top court ruled earlier today in a case pitting privacy campaigners against Google.

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    Ed Tech Startups are Hot: Now, How to Make Money

    There’s no question that when it comes to ed tech, the market is about as hot as it gets. According to CB Insights, roughly $600 million was invested in 103 related deals in the first quarter of this year. Compare that to all of 2013, when investors plugged $1.25 billion into ed tech startups, and you start to sense just how brisk the pace of investing has been.

    Some questions now are where to pour more dollars, as well as how investors will wring venture returns out of the startups they’ve already backed. Wright Steenrod, a partner at Chrysalis Ventures, has a few answers, based on his 10 years of experience in ed tech investing. We chatted by phone yesterday.

    Your firm has sold several ed tech companies, and you’re currently on the boards of three others. What do you think education will look like in 20 years?

    I think there will be a public K-12 system and that we’ll still have four-year colleges where people go to school and live in dorms. In North America, which has brand value in post secondary leadership, [education] will still be delivered through the institutions that it’s delivered through now. But international [education] is a completely different story. Because the developing world has fewer robust institutions, it’s much more of a green field opportunity.

    There are so many ways to fund education-related startups right now. What are you looking for specifically?

    We think there’s opportunity within K-12 and secondary education. When you look at the budget situation in this country, it’s hard to argue that schools will receive more money to spend; instead, they have to create greater value with lesser dollars, much like healthcare. So tech and services that help schools deliver better value at less cost is an area of interest.

    What kinds of tech and services?

    I think overall, standardized tests will see a lot of innovation. Even more interesting to me are cognitive science tests that tell you quite a bit about how somebody thinks or behaves. These types of tests have been sitting around in desk drawers because you didn’t have the Internet to distribute them, and you didn’t have an artificial intelligence engine to grade them, but [now that we do], I think you’ll see more.

    What’s overfunded?

    From an early-stage investor’s point of view, it’s difficult to try and figure out which content and curriculum will succeed. It’s being sourced all over the globe. There are talented people everywhere who’ve developed online ways of helping 4- to 6-year-olds learn how to read, and created math programs for 7-years-olds. But is the literacy program developed in Australia — versus Singapore versus California — better? I think it’s very hard to determine from an investors’ perspective, yet a lot of money is going into [related startups].

    It’s hard to see how many of these companies exit. Who are the acquirers here for companies that don’t go public?

    There are a number of non-traditional buyers that are interested in education. Google’s deal with Renaissance Learning comes to mind. I think private equity firms or new strategics will be buyers, including because you can build stable cash-flow businesses around education. Traditional institutions like Pearson will be buyers as well, though with all the money coming into the space, they aren’t going to buy enough to allow many investors to find a successful exit.

    We should all be excited as citizens for what tech is doing for education. But I do think how you make money off those innovations remains the biggest challenge for investors.

    dropcam_300x250_learn

    New Fundings

    Addepar, a 4.5-year-old, Mountain View, Ca.-based cloud-based platform that’s used by wealth and fund managers to connect users’ financial data in a single repository, has raised $50 million in a round of financing led by Yammer founder David Sacks and the venture firm Valor Equity Partners. The company has raised $65.8 million altogether, including from AccelerateIT Ventures and ff Venture Capital.

    Adform, a 12-year-old, Copenhagen-based ad tech company, has raised $5.5 million in Series B funding led by the Nordic firm Via Venture Partners, which had also provided Adform with an undisclosed amount of funding in 2010.

    Anaplan, a 7.5-year-old, San Francisco-based company that makes business planning software, has raised $100 million in Series D funding led by DFJ. Other investors in the round include Brookside Capital,Coatue Management, Sands Capital Management, and Salesforce, along with earlier investors Granite Ventures, Meritech Capital Partners and Shasta Ventures. Anaplan has raised $150 million altogether. The WSJ has more on the giant round here.

    Aquion Energy, a 5.5-year-old, Pittsburgh, Pa.-based company that makes sodium ion batteries and energy storage systems, has secured $20 million in venture debt from Trinity Capital Investment and CapX Partners. The company has separately raised about $94 million in equity, according to Crunchbase. Some of its backers include Kleiner Perkins Caufield & Byers, Foundation Capital, Advanced Technology Ventures, Bright Capital, Bill Gates, and Gentry Venture Partners.

    Auxmoney, a 6.5-year-old, Düsseldorf, Germany-based peer-to-peer marketplace for lending money, has raised a $16 million Series B round led by Foundation Capital. Partech Ventures and Scott Bommer, founder of the hedge fund SAB Capital, also participated in the funding, as did earlier investors Index Ventures and Union Square Ventures. Auxmoney has raised $29 million to date, reports TechCrunch.

    BlazeMeter, a 2.5-year-old, New York-based company that has created a self-service, cloud-based performance testing platform for enterprises, has raised $6.5 million in Series A funding led by earlier investor YL Ventures. Glilot Capital Partners and Western Technology Investment also participated in the round, reports TechCrunch. The company has raised $7.7 million to date.

    BuildingIQ, a 4.5-year-old, Foster City, Ca.-based maker of energy-management software, is looking to raise a new round of financing on a par with a $9 million round the company closed in early 2013, reports Bloomberg. BuildingIQ’s current backers include Aster Capital, Paladin Capital Group, and Siemens Venture Capital. It has raised $20.7 to date.

    ChargePoint, a 6.5-year-old, Campbell, Ca.-based electric vehicle charging network, has raised $22.6 million in new funding from existing investors Rho Ventures, Kleiner Perkins Caufield & Byers, Braemar Energy Ventures, Siemens Venture Capital, Voyager Capital and BMW. It has now raised a total of $110 million in funding.

    Chase Pharmaceuticals, a 6.6-year-old, Washington, D.C.-based company that’s focused on the clinical development of treatments for central nervous system diseases, has raised $21 million in Series B funding led by New Rhein Healthcare Investors. Other new investors include Edmond de Rothschild Investment Partners and Cipla Ventures. The company has raised $22.2 million to date, shows Crunchbase.

    Colabo, a 3.5-year-old, San Carlos, Ca.-based software company whose platform helps sales and marketing professionals with lead generation, has raised $1.5 million in funding from the Hive, a firm that incubates and funds data-focused startups. Other participants in the round included Pivotal CEO (and former VMWare CEO) Paul Maritz, and Ray Rothrock, who spent 25 years as a venture capitalist with Venrock.

    Instart Logic, a 3.5-year-old, Mountain View, Ca.-based company that makes application delivery software aimed at improving Web and mobile app performance, has raised $26 million from Kleiner Perkins Caufield & Byers, Andreessen Horowitz, Greylock Partners, Sutter Hill Ventures and Tenaya Capital. The company has raised $52 million to date.

    iYogi, a 6.5-year-old, Gurgaon-based company that sells online, subscription-based technical support services across a wide range of computing and communications devices, has raised $28 million in Series E funding from Axon Partners Group, Madison India Capital, and a group of other unnamed investors, reports VCCircle. The company has raised $86.5 million to date, according to Crunchbase.

    Lysosomal Therapeutics, a new, Cambridge, Ma.-based company focused on discovering new drugs for neurodegenerative diseases, has raised $4.8 million in seed funding led by Atlas Venture. Other participants in the round included Hatteras Venture Partners, Lilly Ventures, Sanofi-Genzyme BioVentures, Roche Venture Fund,Partners Innovation Fund, Orion Equity Partners, and several angel investors.

    Mobius Motors, a three-year-old, Kenya-based car-manufacturing company that plans to build Africa’s cheapest car, has raised an undisclosed amount of funding from Pan African Investment Co., the two-year-old investment firm of billionaire Ronald Lauder and former TimeWarner CEO Dick Parsons. Forbes has more here.

    SalesPredict, a two-year-old, San Francisco-based SaaS startup focused on helping its clients increase revenues using predictive analytics, has raised $4.1 million in Series A funding from Yandex, KGC Capital and existing investors. The company has raised 5.3 million to date.

    Shareablee, a 1.5-year-old, New York-based social media analytics startup, has raised $6 million in Series A funding led by SoftBank Capital. Earlier investor Valhalla Partners also participated in the round, which brings the company’s total funding to $6.76 million.

    Swagbucks, a 5.5-year-old, El Segundo, Ca.-based rewards site that competes with RetailMeNot and others, has raised a $60 million round of funding from Technology Crossover Ventures. It is the first round of outside funding for the company, which has been profitable since 2010, reports TechCrunch.

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    New Funds

    Norwest Venture Partners has closed its 12th fund, Norwest Venture Partners XII LP, at $1.2 billion, which is the same size as its last fund, closed in 2009. Wells Fargo remains the outfit’s sole backer. The WSJ’s Deborah Gage has much more here.

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    IPOs

    Zendesk, the on-demand customer service platform provider, is expected to go public on Thursday in an IPO that could prove important to Box‘s postponed initial offering. Silicon Valley Business Journal elaborates here.

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    Exits

    HealthPost, a three-year-old, Houston-based physician referral and appointment scheduling startup, has been acquired for “around $25 million” by The Advisory Board Company, a Washington, D.C.-based research, technology, and consulting firm. MedCity News has more here. HealthPost had raised an undisclosed amount of money from Next Wave Health.

    Lumena Pharmaceuticals, a three-year-old, San Diego-based biopharmaceutical company focused on rare cholestatic liver diseases and serious metabolic disorders, has been acquired for $260 million by Shire, a Dublin-based specialty pharmaceuticals company that trades on the London Stock Exchange. Lumena had raised roughly $70 million from investors, including Alta Partners, New Enterprise Associates,RA Capital Management, Adage Capital Management, RiverVest, and Pappas Ventures and had filed to go public last month. Xconomy has more here.

    NanoH2O, a nine-year-old, L.A.-based maker of reverse osmosis membranes for seawater desalination, has been acquired by Seoul-based LG Chem Ltd. for $200 million. The company had raised at least $95.5 million, shows Crunchbase, including from Khosla Ventures, Oak Investment Partners, BASF Venture Capital GmbH, Total Energy Ventures International and the China-focused fund Keytone Ventures. Bloomberg has more here.

    VersaPharm, a 19-year-old, Marietta, Ga.-based developer and marketer of generic pharmaceuticals and topical treatments, has been acquired by the publicly traded specialty drugmaker Akorn for $440 million. The acquisition price wasn’t disclosed. The Atlanta Business Chronicle has more here.

    Wilocity, a 6.5-year-old, Caesarea, Israel-based mobile device chip maker, is in advanced talks to be acquired by the mobile phone chip maker Qualcomm, for “some $300 million,” reports Haaretz. The piece adds that the “two sides have yet to agree terms on all the provisions of the sale.” Wilocity has raised at least $55 million from investors, including Benchmark, Sequoia Capital, Jerusalem Global Ventures, and Tallwood Venture Capital.

    —–

    People

    Fast Company has just published its list of the “100 Most Creative People in Business” edition and it’s studded with tech operators. Among them: Tim Kendall of Pinterest, Naval Ravikant of AngelList, and Mariam Naficy of Minted.

    In 2010, Facebook CEO Mark Zuckerberg donated $100 million to the Newark public school system. Four years later, the funds have had astonishingly little impact, reports the New Yorker.

    —–

    Job Listings

    Trulia, the residential real-estate site and service that went public in the fall of 2012, is looking for a VP of business development. The job is in San Francisco.

    —–

    Happenings

    The VentureScape conference kicks off in San Francisco today. Here is the agenda, if you’re thinking about swinging by. (StrictlyVC hopes to be there for a bit.)

    Wired’s BizCon conference also kicks off today. Here are some details about the event, taking place in New York City.

    —–

    Data

    The research firm 451 Research has surveyed its audience a handful of times since the spring of 2012 of it says respondents have never been so bullish on M&A as now, with 72 percent expressing plans to step up their M&A activity through the end of 2014. More here.

    Health-software startups raised $237.5 million in the first quarter of this year, the most raised in any single quarter since 2000, according to Dow Jones VentureSource.

    —–

    Essential Reads

    Square Wallet had everything going for it. And now it’s dead.

    Launching a business is easier than it’s ever been, but the lives of new companies are often brutish and short, reports James Surowiecki.

    —–

    Detours

    An around-the-world selfie.

    Mom computer therapy.

    —–

    Retail Therapy

    The Wiki Booth.

    Calamityware!

    —–

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

    Connie

  • StrictlyVC: May 12, 2014

    Good morning, everyone! Hope you had a terrific weekend.

    —–

    Top News in the A.M.

    Faced with pressure from Google and other corners of the tech world, FCC Chair Tom Wheeler is revising his proposed rules to allow Internet service providers to charge content companies like Google for faster access into U.S. homes, reports the WSJ. Doubtful it goes far enough to appease critics, however. He’s reportedly “sticking to the same basic approach but will include language that would make clear that the FCC will scrutinize the deals to make sure that the broadband providers don’t unfairly put nonpaying companies’ content at a disadvantage . . .”

    —–

    When One Hello Just Isn’t Enough

    Orkut Buyukkokten, the Turkish Google engineer who is best known for building Google’s early social network, also named Orkut, has left the company after nearly 12 years to co-found Hello, a still-stealth social network that’s been flying under the radar for the last three months — though likely not for much longer.

    Buyukkokten hasn’t yet responded to an interview request sent yesterday afternoon, but Hello’s site describes Hello as a “one-of-a-kind community of users who celebrate friendship, imagination, self-expression, and authentic engagement in a safe environment.” It goes on to encourage users to “[e]ngage in targeted social exploration and content sharing with fascinating connections that relate to the diverse parts of your personality.”

    StrictlyVC is still trying to learn more, including who has funded Hello, but its ties to Google run strong. Apart from Buyukkokten, the startup’s domain, Hello.com, was long owned by Google, which had used it for an early, Snapchat-like photo sharing service called Hello that it shuttered in 2008. Google held on to the domain until last month, when it reportedlytransferred Hello.com to John Murphy, Hello’s co-founder and chief technology officer. Murphy, like Buyukkokten, also spent roughly a dozen years as a software engineer and manager at Google. (One of the only other employees listed on LinkedIn as working at Hello, Benjamin Douglass, is also a former Google engineer.)

    Meanwhile, in January, a San Francisco-based company called Hello quietly raised $10.5 million from 44 investors, according to an SEC filing that shows a target of $18.2 million. The one individual listed on the filing is James Proud, a South London native who arrived in San Francisco several years ago by way of the Thiel Fellowship program, a two-year fellowship for applicants under age 20. As a Thiel Fellow, Proud developed and sold his startup, GigLocator, which aggregated live music listings, for an undisclosed amount in 2012.

    Is it just a coincidence that two companies with ties to powerful Silicon Valley nodes would both be operating in stealth mode less than fifty miles away from each other? Perhaps. After all, this is Silicon Valley, where entrepreneurs routinely operate in their own little worlds. And more to the point, StrictlyVC can’t tie them together as of this writing. (We reached out to Proud and Murphy for comment, but to no avail.)

    Whether these companies are connected or not, one thing is certain: Buyukkokten’s Hello seems ready to raise its public profile. This past Saturday night, sources tell me that Buyukkokten bused 200 people from San Francisco down to Hello’s Palo Alto headquarters for a launch party. If it was anything like Buyukkokten’s past affairs, we may be reading about it soon on Gawker, too.

    dropcam_300x250_learn

    New Fundings

    iZettle, a four-year-old, Stockholm-based mobile payments company that’s been compared to a European version of Square, has raised $55 million in new funding led by Zouk Capital, with participation from two other new investors, Dawn Capital and Intel Capital. Earlier investors Creandum, Greylock Partners, Index Ventures, Northzone and SEB Venture Capital also participated in the round, reports TechCrunch. Altogether, the company has raised roughly $100 million, including from American Express, MasterCard and Banco Santander.

    Pure Life Renal, a year-old, Hollywood, Fla.-based dialysis company, has raised $20 million in Series A funding from Montreux Equity Partners, Noro-Moseley Partners and Hamilton Lane.

    Send Anywhere, a two-year-old, Seoul-based company whose app enables users to directly share content peer-to-peer between devices (without the content being saved to the cloud first), has raised $1 million in seed funding led by SaeMin Ahn, a managing partner at Rakuten Ventures. Other participants, reports TechCrunch, include Andrew McGlinchey, Andy Warner, and two Korean angel investors.

    Shakr Media, a 3.5-year-old, Seoul, Korea-based that combines a marketplace of more than 150 motion graphics video styles with its drag-and-drop video creator technology, has raised $3 million in Series A funding led by Posco Venture Capital. Other investors in the round included the Korean government and 500 Startups.

    Talkspace, a 1.5-year-old, New York-based online platform that connects people with professional and licensed therapists on demand, has raised $2.5 million in seed funding from Spark Capital and Softbank. The WSJ has more here.

    Wochit, a two-year-old, New York-based cloud-based video creation platform that creates quick, affordable video new clips for its customers by mixing licensed photos with reports written by major media companies, has raised $11. 2 million in new funding. The round was led by Marker. Earlier investors Cedar Fund, Greycroft Partners, and Redpoint Ventures also participated in the financing, which brings Wochit’s total capital raised to $16 million.

    —–

    New Funds

    Math Venture Partners, a new, Chicago-based outfit, is hoping to raise a $25 million debut fund, shows an SEC filing that was first flagged by VentureSource. Mark Achler and Troy Henikoff are listed as directors. Achler spent the last year as a partner at StrategyLab, a consultancy; earlier, he was a senior VP at Redbox, a 12-year-old startup that has created a network of self-service kiosks. Henikoff is the managing director of Techstars Chicago and cofounded the summer accelerator program Excelerate Labs.

    United Ventures, a Milan-based venture firm, is about to close its debut fund with at 60 million euros ($82.5 million), VentureWire reported Friday. The firm was created last year through a merger of two venture firms Annapurna Ventures, a seed-stage firm founded by former Google execMassimiliano Magrini, and Jupiter Venture Capital, a firm that was founded by Paolo Gesess, formerly the CEO of a finance company. Jupiter, founded in 2000, had specialized in early- to late-stage investments. Some of United’s LPs include Fondo Italiano di Investimento, Fondazione Banco di Sardegna, Fondazione Cassa di Risparmio di Lucca, Banca Sella and Banca Patrimoni.

    —–

    IPOs

    Nasdaq this year looks to become home to many more IPOs of Israeli firms than in 2013, the stock exchange’s vice chairman said yesterday. More here.

    —–

    Exits

    Ginger Software, a 6.5-year-old, Lexington, Ma.-based natural language processing startup that was founded in Israel, has been acquired by Intel in a deal reported to be up to $30 million. Ginger had raised at least $11.7 million from investors, including Harbor Pacific Capital, Horizons Ventures, and Vaizra Investments, shows Crunchbase.

    —–

    People

    Marc Andreessen: Timeline colonialist.

    Doug Bowman, Twitter‘s company’s creative director, announced in a tweet on Friday that he’s leaving the company after a little more than five years. (He did not tweet about where he is next headed, alas.) Bowman had joined Twitter from Google, where, according to his LinkedIn profile, he led a company-wide project to redefine Google’s visual brand experience. Earlier Bowman had founded his own design consultation agency called Stopdesign.

    Nine years ago, Daniel Lurie, the stepson of the late Levi Strauss & Co. executive Peter Haas, created a San Francisco-based nonprofit called Tipping Point that redirects everything it raises to roughly 45 Bay Area nonprofits that provide shelter, jobs, and education. In some great news for the city, last Thursday Tipping Point raised a record amount — $12 million — at its annual charitable event, which has become a must-attend for big wheels in the tech industry. The San Francisco Chronicle has pictures of the evening’s many attendees, including Apple designer Sir Jony Ive, Jawbone founder Hosain Rahman, Zynga cofounder Mark Pincus, and News Corp. founder Rupert Murdoch, who was the guest of Kleiner Perkins Caufield & Byers’s partner Juliet de Baubigny.

    Some Twitter insiders, including CEO Dick Costolo and cofounders Jack Dorsey and Ev Williams, had pledged to hold on to their shares past when Twitter’s lockup expired last Tuesday as a way to signal their confidence in the company. Twitter COO Ali Rowghani, however, decided not to wait indefinitely, selling 300,000 shares last week for a profit of about $9.9 million, notes Bloomberg. Rowghani still holds about 990,000 shares, according to an SEC filing.

    David Sacks knows a thing or two about acquisitions and he apparently doesn’t think much of Apple‘s reported plans to buy Beats Electronics. Indeed, in response to reports that Beats cofounders Dr. Dre and Jimmy Iovine will become senior execs at Apple, Sacks, the founder and CEO of Yammer (which sold to Microsoft) and former COO of PayPal (sold to eBay), tweeted, “How is tech’s most valuable company also its dumbest?” He then added, “I really like my Beats, but headphones are rapidly getting commoditized. No strategic value here.” BusinessInsider has more here.

    —–

    Job Listings

    Safeguard Scientifics, the publicly traded, Wayne, Pa.-company that provides growth capital to companies in all kinds of fields, is looking for an associate. (It’s a two-year, pre-MBA gig.)

    For StrictlyVC’s India-based readers, Contrarian Drishti Partners, an India-focused, early-stage venture fund, is looking for an investment associate in Mumbai.

    —–

    Happenings

    VentureBeat’s second Databeat event is coming up in San Francisco, May 19 and 20. More information here.

    —–

    Data

    The first quarter of the year is the worst time of year to raise a seed round, according to Tomasz Tunguz of Redpoint Ventures. Here’s why.

    —–

    Essential Reads

    Thirty million people use this social network, and most people still haven’t heard of it.

    After Beats, what’s next on Apple’s shopping list?

    Young bankers fed up with 90-hour work weeks are moving to startups in droves, suggests a new Bloomberg report.

    —–

    Detours

    How we grew so tall.

    The slow-motion making of a tattoo.

    For years, Kenny G’s saxophone instrumental “Going Home” has been
    piped into shopping malls, schools, train stations and gyms in China
    as a signal to the public that it is time, indeed, to go.

    —–

    Retail Therapy

    Ten incredible customer motorcycles.

    Crayon sculptures.

    —–

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

    Connie

    , , ,

  • StrictlyVC: May 9, 2014

    Good Friday morning, everyone. Hope you enjoy your weekend, and to all the moms out there, we wish you a very happy Mother’s Day!

    —–

    Top News in the A.M.

    Here comes the Netflix price hike.

    —–

    The Itinerant Investor: Boris Wertz

    Boris Wertz made headlines last week when he joined Andreessen Horowitz as a board partner, a role the powerhouse venture firm has extended to half a dozen outside investors who sit on select boards on its behalf and share some of their deal flow. (Others of the firm’s board partners include former Microsoft executive Steven Sinofsky, investor Shana Fisher of High Line Venture Partners in New York, and Zillow CEO Spencer Rascoff.)

    Wertz isn’t the kind of person you see in TechCrunch every day, but top investors know him well. The German-born Vancouver resident founded Version One Ventures, a $20 million early-stage venture firm, and Wertz is forever traversing North America to find deals. Over the last two years, he has invested in 18 companies, including the crowdfunding platform Indiegogo; Tindie, often described as an Etsy for electronics; and the venture capital data platform Mattermark. To learn where he might shop next (digital healthcare, government 2.0, bitcoin) and more, I sat down with Wertz earlier this week. Our chat has been edited for length.

    You’re a former entrepreneur who sold your company to another company that sold to Amazon. How did you then break into venture investing?

    [By] doing a little angel investing — in New York, in Vancouver. I did 35 angel deals on my own. I also spent a month with Union Square Ventures [in New York] and another month with First Round Capital in San Francisco and learned from those guys.

    Just two startups in your portfolio are from Vancouver, where you live. Why?

    In Vancouver, there were a lot of interesting companies [coming out of the area] three or four years ago, including Clio (which makes Web-based tools for law firms), Indochino (which makes custom-made clothes for men), and Hootsuite (the social media management platform), but it isn’t consistent. Sometimes, we’ll see a lot of interesting companies emerge over a year or two, then maybe not much.

    How do you explain the inconsistency?

    I think you lose a lot of the most ambitious people to the Valley.

    Where else are you scouting out deals primarily?

    San Francisco, New York, Toronto, and Waterloo feel like the four big markets [to watch] and are where I spend most of my time.

    Waterloo seems to be taking off. How would you describe what’s happening there?

    [University of Waterloo] has always been a very strong engineering university. When you look at where the top tech companies hire outside of the Valley, Waterloo is always one of the top [destinations]. But now, people are becoming more entrepreneurial, too. In the last Y Combinator batch, for example, I think four or five startups came from Waterloo.

    What was the tipping point?

    A lot of people says its [Research in Motion, based in Waterloo], but I don’t think anchor companies alone can do that. Think about Amazon, where there’s a very entrepreneurial culture, along with lots of people with money and great technical talent, yet where you haven’t seen so many startups come out of the company.

    I think sometimes it’s just a phase, where you get lucky for three or four years. There’s just no ecosystem [that reinforces entrepreneurship] like the Valley.

    Do you think Canadian VC will ever rebound? The industry is so much smaller than 10 years ago.

    I don’t think of it so much as Canada versus the U.S. as I do the Valley versus second-tier ecosystems. Seattle and Portland share the same challenges as Vancouver and Toronto, which is that for any VC that’s regionally focused, subpar returns [are inevitable]. Every VC needs to be thesis driven.

    Have you changed your thesis at all? And when will you be in the market again?

    Overall, things are going really well. Any changes would involve optimizing around the edges, so having a little more [to invest] in follow on rounds and [to write bigger] initial checks now that a seed round under $1.5 million is almost unheard of. And there will be a second fund – hopefully! – in 2015.

    Founder Showcase

    New Fundings

    AdYapper, a four-year-old, Chicago Heights, Il.-based whose technology tracks display and mobile ads, partly to determine consumer sentiment, has raised has raised $1 million in new funding from angel investors. An alum of the TechStars‘s accelerator program, AdYapper has raised $2.2 million to date.

    Arcadia Biosciences, a 12-year-old, Davis, Ca.-based agricultural biotechnology company that makes a variety of products, including salt tolerant plants, has raised $33 million in Series D funding led by Mandala Capital Limited, an agribusiness-focused private equity fund in India. Earlier investors, including CMEA Capital, BASF Venture Capital, and Saints Capital, also participated in the round, which brings the company’s total funding to roughly $70 million.

    Bitpay, a three-year-old, Atlanta, Ga.-based platform that processes payments in Bitcoin for merchants, is raising $30 million at a roughly $160 million valuation in a round led by Index Ventures, with Virgin Group founder Richard Branson and Yahoo co-founder Jerry Yang participating, reports TechCrunch. Founders Fund had led a $2 million seed round in the company last year.

    Counsyl, a 5.5-year-old, San Francisco-based technology company whose saliva-based test promises to identify more than 100 serious genetic diseases, has raised $28 million in Series D financing. Rosemont Seneca Technology Partners and Goldman Sachs Asset Managementled the round. The company has raised at least $32.9 million to date, shows Crunchbase. (Notably, it was also cofounded by Balaji Srinivasan, who became the newest general partner of Andreessen Horowitz in December.)

    Dubset Media, a 5.5-year-old, New York-based company that operates an open API platform specifically designed for royalty-based streaming of DJ content, has raised an undisclosed amount of Series B funding. The round was led by Rhapsody International, parent company of leading streaming music services Rhapsody and Napster.

    EndoGastric Solutions, a 12-year-old, San Mateo, Ca.-based device company whose flagship product is used to treat gastrointestinal diseases in a minimally invasive way, has closed $30 million in Series G funding. Investors in the round included Advanced Technology Ventures, Canaan Partners, Chicago Growth Partners, De Novo Ventures, Foundation Medical Partners, Oakwood Medical Investors and Radius Ventures. The company has raised $156 million to date, shows Crunchbase.

    FieldLens, a 2.5-year-old, New York-based company whose project management application targets the construction industry, has raised $8 million in Series A funding led by OpenView Venture Partners. Other participants in the round included Softbank Capital, High Peaks Venture Partners, Lerer Ventures, Contour Venture Partners, Borealis Ventures and NYC Seed. FieldLens has raised $12.2 million altogether.

    ImaginAb, a 6.5-year-old, L.A-based company that clinically manages cancer and autoimmune diseases via molecular imaging by re-engineering antibodies into small proteins, has raised $21 million in Series B funding led by return investor Mérieux Développement, a healthcare investment firm in Lyon, France. Other earlier backers, including Cycad Group, Nextech Invest and Novartis Venture Funds, also participated in the round.

    —–

    New Funds

    Emerald Hill Capital Partners, a nine-year-old, Hong Kong-based Asian fund of funds, has raised its third fund at just over $400 million to largely invest in Chinese, Indian and Southeast Asian private equity firms. Asian Venture Capital Journal has more here.

    GGV Capital, 13-year-old, expansion-stage venture firm, with offices on Sand Hill Road and in Shanghai, has raised a new, $622 million fund, according to an SEC filing first spied by Fortune. According to the filing, the first sale was closed on April 23 and the fund is now closed. StrictlyVC talked with GGV managing partner Glenn Solomon about the firm’s U.S.-China strategy — and its ties to Alibaba in particular — earlier this year.

    —–

    Exits

    Perhaps you’ve heard: Beats Electronics, the streaming music and headphone company, is reportedly about to become part of Apple in a $3.2 billion dollar deal. Much more here.

    Lettuce, a two-year-old, Venice, Ca.-based company that had developed an order management system with a mobile sales app to help businesses capture, track, and process orders anywhere in real time, has been acquired by Intuit for $30 million in cash, according to PandoDaily. According to Crunchbase, Lettuce had raised $3.3 million from Crosscut Ventures, Baroda Ventures, Double M Partners, 500 Startups, Zelkova Ventures, Launchpad LA and Telegraph Hill Capital.

    Spendship, a year-old, Nashville-based developer of a mobile loyalty program, has been acquired by Moontoast, a six-year-old, Nashville-based analytics platform that helps brands better understand their fans. Terms of the deal weren’t disclosed, but Spendship doesn’t appear to have raised outside capital. Moontoast, meanwhile, has raised $16.3 million from investors, including the Martin Companies, an investment firm in (yes) Nashville.

    —–

    People

    Former Vice President Al Gore is now “Romney rich,” reports Bloomberg. Half his fortune came from the sale of CurrentTV to Al Jazeera Satellite Network; the other half has largely come by “leveraging his aura as a technology seer,” including as an Apple board member, advising Google before its 2004 IPO, and as a partner at Kleiner Perkins Caufield & Byers.

    Billionaire venture capitalist Vinod Khosla will have to appear in court to testify about blocking public access to the popular surf spot Martin’s Beach, alongside land that Khosla purchased in 2008. Khosla’s attorneys had argued that he’s a “non-party” to a lawsuit filed by the Surfrider Foundation over the access closure; a San Mateo judge ruled otherwise yesterday.

    San Francisco may be home to a new celebrity soon, or one highly creative real estate agent is at work. According to the local magazine 7×7, pop-country superstar Taylor Swift is circling an enormous Presidio Heights mansion acquired by CNet cofounder Halsey Minor roughly eight years ago. The property, for which he paid $25 million, is falling apart and has long sat on the market; it’s currently priced at $18 million.

    Yesterday, Cameron and Tyler Winklevoss disclosed in a regulatory filing that they’ve chosen to list their Bitcoin exchange-traded fund, the Winklevoss Bitcoin Trust, on Nasdaq. “The fact that the S.E.C. has allowed the S-1 to progress this far is an indication that it may actually happen,” Wedbush Securities analyst Gil Luria tells Dealbook.

    Atomico, the London-based venture firm founded by Skype co-founderNiklas Zennstrom, is suing former employee Pogos Saiadian and consultant Wouter Gort, alleging they quietly diverted potential Atomico investments to a venture firm that the two were building called Greyhound Capital. Among the investments the duo allegedly kept for themselves, after earlier representing themselves as Atomico investors: Homejoy, a cleaning service; the online retailer Dollar Shave Club; and Taxibeat, an app-based transportation service. Sarah McBride of Reuters has the story.

    —–

    Job Listings

    RRE Ventures is hiring an analyst in New York.

    —–

    Happenings

    Founder Showcase kicks off next Thursday morning at the Microsoft Campus in Mountain View, Ca. Featured speakers include Mitch Kapor of Kapor Capital, Mike Maples of Floodgate, and Thomas Korte of AngelPad. More info here. (Click on the ad above for a 20 percent discount.)

    —–

    Data

    CB Insights takes a quick look at Google Ventures‘s largest financings to date.

    —–

    Essential Reads

    Square turned dollars into data. Now it’ll turn that data into gold.

    Silicon Valley startups are trying to eat JPMorgan‘s lunch. The banking giant’s response is to poach talent from Silicon Valley.

    —–

    Detours

    Why mothers and daughters fight.

    ESPN’S top draft analysts workshop your short story.

    Missed connections for a-holes: “At a bar celebrating my friend’s birthday in midtown. You were wearing Google Glass. I tried to mouth, ‘You look like a moron.’ Did you record that?”

    —–

    Retail Therapy

    Cinema placemats.

    Black Dragon Reversible Smoking Jacket.

    Suit pajamas. [Drops mic.]

    Connie

    ,

  • StrictlyVC: May 8, 2014

    Happy Thursday morning, everyone! We’re still working on getting the newsletter to each of you, which is a giant pain in the arse or else we just have terrible email juju. In the meantime, here’s yesterday’s edition, featuring a very personable Mike Abbott of Kleiner Perkins, in case you missed it.

    —–

    Top News in the A.M.

    Some big names in tech — including retailing giant Amazon — have gathered together to sign a letter protesting the proposed net neutrality rules the FCC is considering ahead of its May 15 meeting.

    —–

    In Accelerator Wars, the Teacher Becomes the Student

    Dave McClure once followed Y Combinator’s moves closely, looking to emulate parts of its structure. Now, the famed, nine-year-old tech accelerator looks to be playing catch-up with Dave McClure.

    This week, for example, Y Combinator announced it would start running its Startup School, a one-day networking event, in New York and London. Y Combinator, which will continue to run its three-month sessions from its headquarters in Mountain View, Ca., is casting a wider net because “if we focus on the U.S., we miss maybe 95 percent of the best founders,” said the outfit’s new president, Sam Altman, at a TechCrunch conference in New York.

    Y Combinator also announced its intentions this year to “get bigger,” with Altman handed the reins by cofounder Paul Graham to grow it. Toward that end, the incubator has recently added six people to its roster of partners, and Altman says Y Combinator’s upcoming class could have upwards of 95 companies, making it the biggest in the program’s history.

    Y Combinator’s new initiatives have received a fair amount of attention. But they look oddly familiar to McClure, founder of the four-year-old venture fund and accelerator program, 500 Startups. Indeed, 500 Startups was premised on the idea that venture investing is far more scalable than widely believed, and that to really nab the best deals, an outfit has to go global.

    Each year, 500 Startups backs roughly 300 startups. Half of them pass through the firm’s three-month-long accelerator program, where they’re hosted at 500 Startup’s offices in San Francisco or Mountain View. (The outfit accepts roughly 30 startups each quarter, alternating between the two places.) 500 Startups also invests in another 150 seed-stage firms outside its accelerator program each year. About 20 percent of all of those companies are international, says McClure; 80 percent are U.S.-based companies, with roughly half coming from the Bay Area.

    Part of what makes 500 Startups work at its scale, seemingly, is that it’s investing in far more than ideas. Most of the startups it funds have a functional prototype. Most have customers at some scale. Some even have million-dollar-per-month revenue run rates

    It also believes in “failing on a budget, and failing quickly,” says McClure. (500 Startups a net $75,000 in each company for a 7 percent stake.) And 500 Startups thinks investing is something that can be taught, quickly, to other people, who now represent the outfit’s interests around the world, including Brazil, India, Southeast Asia, China, and Mexico. “Some say it takes 10 years to become a great investor. We think it takes 20 decisions,” says McClure.

    We’ll see what happens. 500 Startups has yet to land an Airbnb or Dropbox – companies that have pushed the value of Y Combinator-backed startups into the tens of billions of dollars, at least on paper.

    Then again, 500 Startups is younger and has a promising portfolio, along with several big exits under its belt. Among them: the 3D printing company Makerbot (acquired for roughly $600 million), the social marketing company Wildfire (acquired by Google for $350 million), and the video site Viki (acquired by Japan’s Rakuten for $200 million).

    500 Startups has closed two funds totaling $73 million so far and is now investing out of a third fund that’s targeting $100 million, shows an SEC filing.

    I ask McClure what he thinks of Y Combinator’s newest moves, and he says, laughing: “Welcome to the party, Sam.” But he also notes that, “We’ll have to work harder. We were hoping to have the international stage to ourselves for five years and it now it looks like it might have been four.”

    In the meantime, McClure takes some pleasure in noting that “we were the first out of the gate on a number of things that Y Combinator is just now paying attention to. I’m a huge fan of [Paul Graham] and Y Combinator itself,” he adds. “But I think we probably influenced their strategy.”

    Founder Showcase

    New Fundings

    Beroomers, a 10-month-old, Valencia, Spain-based student accommodation marketplace, has raised $200,000 in seed funding from the Plug and Play accelerator program along with numbers angel investors.

    Bulu Box, a 2.5-year-old, Lincoln, Neb.-based company that mails out monthly boxes of nutritional product samples from its headquarters, has raised $2 million led by Dundee Venture Capital. Other participants in the round included Midwest Venture Alliance, Mid-American Angels Investments and Two Bridges Capital.

    Flatiron Health, a two-year-old, New York-based company that aggregates cancer-patient data from numerous sources to help doctors make more informed treatment decisions, has raised $130 million in Series B funding, most of it from Google Ventures. First Round Capital, Laboratory Corporation of America and angel investors also participated in the round, which brings the company’s total funding to $138 million. (Much more on the deal and what the funding is being used for here.)

    Hassle, a two-year-old, London-based online marketplace centered around home clearning, has raised $6 million in Series A funding from Accel Partners. TechCrunch has much more here.

    IHear Medical, a four-year-old, San Leandro, Ca.-based company that’s developing a Web-enabled hearing aid system, has raised $2.5 million in new funding led by Lighthouse Capital, a Shanghai-based venture capital firm focused on medical devices and IT. Other participants in the round include earlier backers Aphelion Capital and Highlight Capital. The company has raised $5.3 million to date, according to Crunchbase.

    Igneous Systems, a year-old, Seattle-based data center infrastructure company, has raised $23.6 million in Series A funding led by New Enterprise Associates. Madrona Venture Group, Redpoint Ventures and Isilon Systems co-founder Sujal Patel also participated in the round.

    Layer, a year-old, San Francisco-based company whose technology helps developers to easily integrate messaging, voice and video into apps, has raised $14.5 million in Series A funding from Homebrew, AME Cloud Ventures (the investment vehicle of Yahoo cofounder Jerry Yang), CrunchFund, Fuel Capital and other investors. TechCrunch’s sources say the outfit’s post-money valuation is in the “mid-$60 million range.” The company has raised $22 million to date, shows Crunchbase.

    LimeRoad, a two-year-old, Gurgaon, India-based social commerce platform for women, has raised $15 million in new funding led by Tiger Global Management (which has also funded India e-commerce companies Flipkart and Myntra). Earlier investors Lightspeed Venture Partners and Matrix also participated in the round, which brings LimeRoad’s total funding to $20 million.

    LiquidPlanner, a 6.5-year-old, Seattle, Wa.-based maker of priority-based, predictive project management software, has raised $8 million in Series B funding from TVC Capital, a San Diego-based growth equity firm. It’s the company’s first round of venture funding.

    Maxta, a 4.5-year-old, Sunnyvale, Ca.-based enterprise storage platform developer, has raised $25 million in Series B funding led by new investors Tenaya Capital and Intel Capital. Earlier investorAndreessen Horowitz also participated in this round, which brings Maxta’s total funding to $35 million.

    Motif Investing, a four-year-old, San Mateo, Ca.-based online broker, has raised $35 million in new funding from JPMorgan Chase, Wicklow Capital, and Balderton Capital, along with earlier investors Foundation Capital, Ignition Partners, and Norwest Venture Partners. Motif has raised $86 million to date. Dealbook has much more detail on the deal and the company here.

    Perfecto Mobile, a 7.5-year-old, Woburn, Ma.-based hardware and software platform focused on remote access and automated testing for mobile devices, has raised $20 million in new funding from new investor FTV Capital. Earlier investors Carmel, Vertex, and Globespan Capital Partners also participated in the round, which brings Perfecto’s total funding to roughly $49 million.

    Pinnacle Engines, a 6.5-year-old, San Carlos, Ca.-based maker of ultra-efficient engine designs, has raised an undisclosed amount of Series C funding from Mitsui Global Investment, VenturEast and an unnamed strategic partner along with its existing investors Bessemer Venture Partners, New Enterprise Associates and Infield Capital. The company has raised $30 million to date.

    RevolutionCredit, a two-year-old, Irvine, Ca.-based provider of behavioral credit insights, has raised an undisclosed amount of funding from Accion‘s Venture Lab, a $10 million initiative that provides seed capital and management support to financial start-ups targeting disadvantaged and low-income segments of society.

    Udemy, a four-year-old, San Francisco-based online marketplace for teaching and learning, has raised $32 million in new venture funding led by Norwest Venture Partners. Earlier backers Insight Venture Partners and MHS Capital also participated in the round, which brings the company’s total funding to $48 million.

    Workshare, a 16-year-old, London-based maker of enterprise collaboration apps, has secured $8.4 million in the form of a revolving line of credit from the Technology Finance Division of Wells Fargo Capital Finance. The line of credit follows $33.8 million in funding the company raised in 2012. The company has raised $63.6 million altogether.

    —–

    Exits

    Delicious, the social bookmarking service, is being acquired by Science Inc., the L.A.-based technology investment and advisory firm. Science is acquiring the tool from Avos Systems, a company formed by YouTubecofounders Chad Hurley and Steve Chen. Dealbook has much more here.

    Stackdriver, a two-year-old, Boston-based company that sells monitoring services for cloud-powered applications, has been acquired by Google for an undisclosed amount of money. The company had raised $15 million from Flybridge Capital Partners and Bain Capital Ventures.

    —–

    People

    A friend of Rocky Agrawal — the PayPal director of strategy whose bizarre tweets last weekend may have cost him his job — persuasively argues that Agrawal may have bi-polar disorder and that PayPal should have handled the situation differently.

    Katie Cotton, the VP of worldwide corporate communications at Apple, is retiring after more than 18 years at the company to spend more time with her children, says the company. Cotton served as a gatekeeper to co-founder Steve Jobs and current CEO Tim Cook and will remain best remembered by journalists for those oft-spoken words: “We have no comment.”

    Chang Dong-hoon, head of Samsung Electronics‘ mobile design team, offered to resign last week over criticism of the company’s latest Galaxy S smartphone. Samsung has evidently accepted that resignation, appointing Lee Min-hyouk, vice president for mobile design, to succeed Dong-hoon. Reuters has more here.

    Shawn Price is no longer the head of SAP‘s cloud business unit, sources tell Re/code. More here on what’s happening inside the German business software giant.

    The investors at Rembrandt Venture Partners have ditched Sand Hill Road for a full floor in San Francisco’s Transamerica Pyramid, the tallest building in San Francisco. “When we saw the 360-degree views and full-floor layout, we fell in love with it,” says general partner Scott Irwin. San Francisco has drawn a growing number of venture firms in recent years. Some, including True Ventures, Norwest Venture Partners, Kleiner Perkins Caufield & Byers and Founders Circle Capital, rent office space in the city’s funky South Park neighborhood, built around what in the 1850s was a private garden for high-end residences. Others, including Alsop Louie Partners, Maveron, Sigma West, and Next World Capital, are turning the city’s Jackson Square neighborhood into another venture hub. “We set out to find a creative brick [and] timber space in Jackson Square,” says Irwin, but like most property in San Francisco these days, “the options were very limited.”

    —–

    Job Listings

    SurveyMonkey (backed by Tiger Global and Google) is looking for a director of business development. The job is in San Francisco.

    —–

    Essential Reads

    Strava, the mobile-fitness app that’s popular with competitive cyclists and runners is hoping it can lure a new type of customer: the government.

    Meet gaming’s biggest rock star, Markus Persson, better known as “Notch.”

    —–

    Detours

    The robot car of tomorrow might just be programmed to hit you.

    Thirty-second tech trick: How to use disposable Gmail addresses.

    Iconic romantic scenes remade with burritos.

    —–

    Retail Therapy

    Horror Campout: A terrifying overnight camping experience that you can’t miss — unless you want to live. Mmwhahaha.

    We’re buying new business cards just so we can trot this out as often as possible.

    —–

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

    Connie

    ,

  • StrictlyVC: May 7, 2014

    Hello, and happy Wednesday morning, everyone!

    For an easier-to-read version of today’s newsletter (we’ve been having some formatting issues with a new email service provider we’re been trying out) click here.

    —–

    Top News in the A.M.

    Wow. In 2013, the USPTO granted nine patents for every patent application that was rejected and then abandoned by its applicant. That’s 92 percent, up from 68 percent in 2009, reports Vox.

    —–

    Mike Abbott of Kleiner Perkins on Snapcat, Box, and the Inherent Danger in High Valuations

    Mike Abbott has only been a general partner at Kleiner Perkins Caufield & Byers for two-and-half years, but he’s a grizzled veteran of the startup industry nonetheless. Abbott previously served as Twitter’s VP of Engineering, for example, and as an SVP at Palm. In 2002, he also founded the data virtualization startup Composite Software, which was acquired by Cisco last year for $180 million in cash. (Composite had raised at least $38 million, including from Apax Partners, Palomar Ventures, and Clearstone Venture Partners.)

     

    Little wonder that Abbott has a pretty strong perspective on many things startup related. The other day, we talked about a few of them, including attractive places to shop right now, why some transition on a startup’s board can be good, and what companies can do about spiraling valuations.

     

    How would you characterize what you’re looking for right now?

     

    Predominately, I spend time [considering] applications that are driven from large data processing . . . And I probably have a little more of a bias toward either design-centric and engineering-centric companies. That sounds generic, I realize, but that’s what I’ve done operationally. So . . looking at novel things around mining email in the enterprise, or what the implications are for sales forecasting, or mining digital health data for consumers or insurance providers.

     

    I’ve also spent some time looking into the ephemeral content space.

     

    That’s interesting. Ephemeral content seems afield from your other interests. 

     

    I do office hours at Stanford and every time I meet with a student, I ask what’s on their phone’s home screen and take a peek. And over the last few years, [it’s gone from] students using Facebook to not using Facebook not having it on their phones to the rise of Snapchat [and the idea that] not having content on your phone is a cool thing.

     

    What does that mean for Twitter’s prospects? The Atlantic has already pronounced it a dead duck, as you likely know.

     

    It’s funny, because [reporters] write these articles, then use Twitter to spread the word about them. A number of pieces have said that it’s dying, only to report six months later, “Oh, it’s back!” No one can doubt that Twitter is a meaningful information network that’s changing the world. Is everyone on it? No. And I think the company needs to evolve the product to make it easier for the masses to use. But there isn’t a clear number two, and it’s continuing to grow. I’m very bullish on the company.

     

    Kleiner has gone through a transition and is a much smaller operation going forward. Have you taken on any of your colleagues board seats? 

     

    I haven’t and for the most part, we’ve hoped to have partners stay on those boards on behalf of KP even if they’re [transitioning out of the firm].

     

    Speaking generally, do you think there’s a particularly good way to transfer board seats? 

     

    We always look at companies and ask if we have the right person on that board to help the company. So there may be changes in the future, depending on [partners’] different strengths and the different stages of a company. When I joined Kleiner, for example, I took over a seat at InMobi, the private ad network, where it happened to be that my background specifically at Twitter was helpful and they were excited. I do think it has to be a conversation between the company and the firm to get the right person.

     

    There’s been a lot of talk this week about the impact of high valuations when the market turns less hospitable. How sensitive is Kleiner to price, and is that changing in this increasingly unpredictable environment?

     

    For those of us who saw of this firsthand in 1999 and 2000, you [know that] you have to be cautious when you’re doing this higher-altitude fundraising because the market can change . . . I do think it’s going to be tough for some of these companies that have raised at these upper bounds to weather the storm.

     

    Does the correction we’re seeing make you nervous? 

     

    It’s not that much of a surprise, I guess. Also, at the early stage, it hasn’t impacted us too much. The venture world lags the public markets by six months typically. I do think for certain companies, there’s a new question being asked, which is: If the economy changes, will this service or product still be in demand. I won’t name any specific companies, but if you have a service that’s in higher demand along with higher disposable incomes when the economy is doing really well, what happens when it changes? I don’t necessarily know that that question would have been asked nine months ago. You could argue that it should have been.
    —–
    Founder Showcase
    —–
    New Fundings
    Bloomlagoon, a two-year-old, Helsinki-based mobile games company, has raised $3.6 million in Series A funding round led by Northzone. Other investors in the round included Inventure and 360 Capital Partners along with earlier investors Jari Ovaskainen and London Venture Partners.
    Delectable, a year-old, San Diego-based company whose iOS app allows users to find and share wine recommendations, has raised $3 million in Series A funding from Deep Fork Capital and numerous individual investors, including Ron Conway, Max Levchin, and David Sacks.
    Fever, a year-old, Madrid, Spain-based event discovery and booking app, has raised $3 million in seed funding from a long line of individual investors, including professional soccer player Sergio Ramos of Real Madrid, and singer-songwriter Alejandro Sanz.

     

    HG Data, a 3.5-year-old, Santa Barbara, Ca.-based business intelligence company,
    has raised $2 million in additional Series A funding led by Rincon Venture Partners. Earlier investor Epic Ventures also participated in the round, along with several individual investors. The company has raised $6.3 million to date, shows Crunchbase.
    Loxo Oncology, a year-old, New York-based company that’s focused on targeted cancer therapies, has raised $24 million in Series B funding from New Enterprise Associates, OrbiMed Advisors, and Aisling Capital. The company has raised $57 million to date.

     

    Metacloud, a 2.5-year-old, Pasadena, Ca.-based company that deploys and supports production clouds for companies across a range of industries, has raised $15 million in Series B funding from new investors Pelion Venture Partners, Silicon Valley Bank, and UMC Capital, as well as earlier investors AME Cloud Ventures, Canaan Partners, and Storm Ventures. The company has raised $25 million to date.
    Roseonly, a year-old, Beijing-based e-commerce company that sells on flowers, chocolates, and other high-end gifts, has raised $10 million in Series B funding from IDG Capital and Accel Partners, according to China Money Network. The latest round values the company at $100 million, says the report.
    Smore, a nearly three-year-old, Palo Alto-based platform for easily creating single-page promotional websites, has raised $1.7 million in seed funding led by Founder’s Co-op, with participation by Greylock Partners Israel and various angels. Smore is a graduate of the TechStars accelerator program.
    TrademarkNow, a two-year-old, Helsinki-based company whose online trademark search tool promises to make it easier to find potential trademark infringements, has raised $3.5 million in Series A funding led by Balderton Capital. Others of the company’s investors include Lifeline Ventures, Tekes, and angel investors.
    Vaurum, a two-year-old, Palo Alto-based cryptocurrency company developing bitcoin exchange software for financial institutions, has raised $4 million in seed funding from Battery Ventures and angel investors, including Tim Draper and Steve Case.
    —-
    IPOs
    Everything you need to know about Alibaba‘s IPO filing, along with everything to know about its early winners.
    —–
    Exits
    Adometry, a nine-year-old, Austin, Tx.-based marketing analytics and optimization platform that had raised $44.6 million from investors, has been acquired by Google for an undisclosed amount. Adometry’s investors included Austin Ventures, Sierra Ventures and Shasta Ventures. The WSJ has more here.

    Convertro, a five-year-old, Santa Monica, Ca.-based that (like Adometry), runs a marketing optimization platform, has been acquired by AOL for $89 million plus up to $10 million in earn-outs. Convertro had raised north of $5 million from MHS Capital,Bessemer Venture Partners, Founder Collective, and DAG Ventures.

    Kippt, a two-year-old, San Francisco-based collaborative bookmarking system for professional networks, allowing users to collect and share content, has been acquired by the digital wallet technology company Coinbase for an undisclosed amount of money. Both companies are graduates of the summer 2012 Y Combinator accelerator program.
    —–
    People
    Saydeah Howard, formerly a VP of human resources at the educational toy maker FrogLeap Enterprises, has joined Institutional Venture Partners as its VP of talent and venture services. Earlier in her career, Howard worked as an associate at Russell Reynolds Associates.
    James Loftus, formerly the head of corporate development at Yahoo, has left the company to become a partner at Andreessen Horowitz, reports Business Insider. Loftus had worked at Yahoo for nearly two years and for more than two years at Google before that, where he was in charge of mergers and acquisitions.
    Anne Wojcicki is taking her genetics startup 23andme to English-speaking markets abroad after facing hurdles from the U.S. FDA, reports Reuters. In a company blog post, Wojcicki had stressed that she “stands behind the data” and would work in concert with the FDA to “lay the groundwork” for regulatory approval. Yet a friend of Wojcicki tells Reuters that without testing the waters outside the U.S., “it might be more difficult to get the data to support authorization in the U.S.”
    —–
    Job Listings
    Twitter is looking for a business development manager for its mobile and connected devices group. The job is in San Francisco.
    —–
    Data
    The National Venture Capital Association‘s annual Yearbook has new data on the incredibly shrinking venture industry. According to its findings, over the last decade the number of venture funds has fallen by 25 percent; the number of venture firms has fallen by 8 percent; and the number of venture capital professionals has fallen off a cliff, down to 5,891 in 2013 from 14,777 in 2003. Geekwire has more here.
    —–
    Essential Reads
    Amazon remains the clear frontrunner when it comes to online sales. But new data reveals that the race is heating up, with Apple now in second place.
    Yahoo is selling roughly 40 percent of its Alibaba stake in the Chinese Internet company’s upcoming IPO, a move that could generate more than $10 billion for the struggling Internet giant. Naturally, analysts are already weighing in on where CEO Marissa Mayer should invest it.
    Wired takes readers inside Tindie, a thriving new marketplace for DIY gadgets.
    —–
    Detours
    NFL Commission Roger Goodell agreed yesterday to do an online Q&A with followers of the NFL’s official Twitter account. He received lots of questions, too. Among them: “Is there anyone anywhere more out of touch and incompetent than you?” “How much wood could a woodchuck chuck if it wasn’t suffering brain trauma from 12 years as an NFL offensive lineman?” “Any predictions on who the next NFL player to be convicted of murder will be?”
    —–
    Retail Therapy
    Star Trek cakes.
    PostalPix aluminum prints.
    The very last thing the world needs.
    —–
    Correction
    In a people item in Monday’s newsletter about Fran Hauser, the newest partner at San Francisco-based Rothenberg Ventures, we reported that firm founder Mike Rothenberg was “formerly a director at his family’s residential real estate investment firm in Austin, Texas.” That wasn’t quite right; apologies. Rothenberg founded the firm with his brother, he told us in an email yesterday, explaining that it was “more of a startup than a family operation.”

    Connie

    ,

  • StrictlyVC: May 6, 2016

    Good morning, everyone! You can click here for a better reading experience today (you’ll avoid some of the weird formatting issues below).
    —–
    Top New in the A.M.
    Vanity Fair takes on the great smartphone battle between Apple and Samsung.

    “‘We’ve been ripped off.’ Christopher Stringer, one of the iPhone designers, looked at the Galaxy S in near disbelief. All that time, he thought, all that effort trying out hundreds of designs, experimenting with the size of the glass, drawing different icons and buttons, and then these guys at Samsung just take it?”
    —–
    Founder Showcase
    —–
    New Fundings

    AirPR, a 2.5-year-old, San Francisco-based tech platform designed to increase public relations performance, has raised $4 million in Series A funding led by Mohr Davidow Ventures. Crosslink Capital, Correlation Ventures and angel investors also participated in the round, which brings the company’s funding to date to $5 million.

    Area 1 Security, a months-old, Menlo Park, Calif.-based cyber-security startup founded by three former NSA analysts, has raised $2.5 million in seed funding fromKleiner Perkins Caufield & Byers, Cowboy Ventures, Data Collective, First Round Capital, Allegis Capital, Ray Rothrock and Derek Smith.

    Automattic, the nine-year-old, San Francisco-based company behind the popular blogging platform WordPress, has raised $160 million in new funding led by Insight Venture Partners. New investors Chris Sacca and Endurance also participated in the round, along with earlier investors True Ventures, Tiger Global Management,and Iconiq. In a post about the funding, company cofounder and CEO Matt Mullenweg writes that, “This is obviously a lot of money, especially considering everything we’ve done so far has been built on only about $12 million of outside capital over the past 8 years.” But “there was an opportunity cost to how we were managing the company toward break-even, and we realized we could invest more into WordPress and our products to grow faster.”

    Drivy, a three-year-old, Paris-based peer-to-peer car rental platform, has raised $8.3 million in funding from Alven Capital and Index Ventures. To date, the company has raised roughly $10 million, shows Crunchbase.

    Embibe, a two-year-old, Mumbai, India-based online education platform, has raised $4 million in funding from Kalaari Capital and Lightbox Ventures, reports Times of India. Initially, the company was backed by Sandeep Murthy, who led the India investments of venture firms Kleiner Perkins Caufield & Byers and Sherpalo Ventures. Recently Murthy with his partners launched Lightbox, a $90 million fund that StrictlyVC mentioned last week. (An interview with Murthy is coming.) Lightbox has absorbed six companies that Sherpalo and Kleiner Perkins Caufield & Byers funded in India. Embibe is its first new investment, however.Flux, a new, San Francisco-based company that creates collaborative design software for the building construction industry, has raised $8 million in Series A financing led by DFJ. Borealis Ventures also participated in the funding. Flux was born out of Google’s moonshot factory, Google[x].

    Guangzhou Xianhai Internet Technology, a China-based online game developer, has struck a deal with Beijing Enlight Media, one of China’s largest film and television content suppliers. Specifically, Enlight is paying $37 million in cash for a 20 percent stake in Guangzhou, a move should help Enlight expand into China’s online and mobile game industry and adapt its movies into online games.
    NavInfo, a China-based digital mapping provider, will see an 11.3 percent stake in its business transfer hands from its state-owned parent, China Siwei Surveying & Mapping Technology Corp., to Tencent Holdings, Asia’s biggest Internet company, which is paying $187 million for the position. Alibaba Group Holding announced a similar deal earlier this year; it’s buying AutoNavi Holdings in a deal that values the mapping company at $1.5 billion.Optimizely, a nearly four-year-old, San Francisco-based web optimization platform, has raised $57 million in Series B funding led by Andreessen Horowitz. Earlier backers Benchmark Capital and Bain Capital Ventures also participated in the round, which brings the company’s total funding to $88 million.

    Orbotix, a four-year-old, Boulder, Colo.-based maker of smartphone-controlled robotic toy balls, has raised $15.5 million funding led by Shea Ventures and Grishin Robotics. Earlier investor Foundry Group also participated in the round, which brings the company’s funding to roughly $30 million.
    Pear Sports, a  four-year-old, Irvine, Ca.-based company that provides online fitness tracking and interactive coaching, has raised $5 million in Series B funding led by earlier investors Innovate Partners and Nordic Ventures. Unnamed individual investors and TV maker Vizio also participated in the round, which brings the company’s total funding to $6.2 million, shows Crunchbase.
    Perfecto Mobile, a 7.5-year-old, Woburn, Ma.-based testing and monitoring platform for mobile apps and websites, has raised $20 million in Series D funding led by FTV Capital. The found brings the company’s total funding to nearly $50 million. Others of its investors include Globespan Capital Partners, Waisbein Fund, Carmel Ventures, and Vertex Venture Capital. 
    Planday, a year-old, Copenhagen-based maker of workforce scheduling and HR software, has raised $3.75 million from the Nordic VC Creandum.
    QPID Health, a year-old, Boston-based electronic health records spinout from Massachusetts General Hospital, has received a $12.3 million investment led by New Leaf Venture Partners. The company has raised $16.3 million to date, including from Massachusetts General Physicians Organization, Matrix Partners, Partners Innovation Fund, and Cardinal Partners.
    Top Hat, a five-year-old, Toronto-based mobile and web-based classroom response and engagement tool, has raised $10 million in Series B funding led by Georgian Partners. Earlier investors Emergence Capital Partners, iNovia Capital, SoftTech VC, Version One Ventures and Golden Venture Partners also participated in the round, which brings the company’s total funding to roughly $22 million, shows Crunchbase.
    Smartsheet, a nine-year-old, Bellevue, Wash.-based company that makes collaborative work management software, has raised $35 million in funding led by Sutter Hill Ventures. Earlier investors Insight Venture Partners and Madrona Venture Group also participated in the round, which brings the company’s total funding to roughly $65 million.UberMedia, a four-year-old, Pasadena, Calif.-based mobile ad targeting and social app company, has raised $8 million in funding led by Blue Chip Ventures and Gordon Crawford. The company has raised $25 million to date, including from Accel Partners, Index Ventures, Lerer Ventures and Revolution Ventures.

    WealthEngine, a 23-year-old, Bethesda, Md.-based wealth research services firm (it helps its users find well-heeled prospects to target), has raised $7 million in Series B funding from earlier investors Novak Biddle Venture Partners, Streamlined Ventures, HKB Capital, and others. The company has raised $15.7 million to date, according to Crunchbase.
    —–
    New Funds
    DH Investments, a 12-year-old, Beijing-based private equity and venture capital firm, is raising a third venture capital fund that is targeting $150 million, according to VentureWire sources. At $150 million, CDH Venture III will be much smaller than its predecessor, CDH Venture II, which totaled $500 million, and closer to the firm’s first, $200 million, venture fund closed in 2006. The firm’s areas of interest are broad; among some of its newer information technology bets are Lailaihui, an e-commerce site focusing on outbound travel sales in China; Gewara, an online movie ticket seller through which users can buy tickets at discounts and choose seats; and Wacai, a Chinese mobile app developer and the creator of a personal finance management mobile app.

    CommonAngels, a well-known startup investing group of around 50 Boston-area angel investors, is looking to raise a $35 million new pooled fund and is nearly halfway there, according to a new SEC filing that lists the group’s managing directors, James Geshwiler and Maia Heymann. CommonAngels began raising the fund some time last year.

    —–
    IPOs
    The real impact of Alibaba has yet to be felt here. But it’s coming. Re/code’s Kara Swisher counts the ways as it prepares to file its IPO.
    TrueCar, an eight-year-old, Santa Monica, Ca.-based car pricing information site, disclosed in a filing yesterday that it plans to sell 7.775 million shares at a range of between $12 and $14 a piece, which would give the company a valuation of just less than a billion dollars. The company had initially filed to go public about a month ago. Its biggest shareholders include Capricorn Management, which owns 16.02 percent of the company; Upfront Ventures, which owns 15.23 percent; Anthem Ventures, which owns 9.31 percent; Vulcan Capital, which owns 9.08 percent; and Peppy Capital Partners, which owns 6.62 percent.
    —–
    Exits
    Adchemy, a 10-year-old, Foster City, Ca.-based SaaS-based software company that helps marketers optimize their paid ad campaigns – has been acquired by WalmartLabs, the company’s Silicon Valley-based innovation lab and R&D center. Terms of the deal weren’t disclosed, but TechCrunch hears this was mostly a talent acquisition, with 60 of Adchemy’s employees now expected to head off to WalmartLabs. Adchemy had raised nearly $120 million over the years, shows Crunchbase. August Capital, Mayfield Fund, Accenture and Microsoft were among its investors.
    BrandAds, a 2.5-year-old, Emeryville, Ca.-based application that measures the effectiveness of video advertising, has been acquired by Extreme Reach, a Needham, Ma.-based video platform for integrated TV, digital, and mobile video advertising. Terms of the deal weren’t disclosed. According to Crunchbase, BrandAds had raised just $180,000 in seed funding. Extreme Reach, meanwhile, has raised nearly $150 million from investors, including Greycroft Partners, Village Ventures, and Spectrum Equity.
    ClearEdge Power, an 11-year-old, Hillsboro, Or.-based fuel cell maker, has filed for Chapter 11 bankruptcy proceedings. Last month, facing a cash shortfall, the company laid off 268 employees and closed two manufacturing hubs in South Windsor, Cn. ClearEdge had raised at least $144.3 million from investors, shows Crunchbase. Among its backers are Applied Ventures, Kohlberg Ventures, Southern California Gas Company, and Artis Ventures.

    Lyfe Mobile, a two-year-old, Santa Monica, Ca.-based mobile demand-side platform (DSP), has been acquired by the British video advertising company Blinkx in an all-cash transaction. The purchase price wasn’t disclosed. Lyfe had not disclosed any outside funding.

    Nixter, a two-year-old, Santiago, Chile-based company whose mobile app promised to make it easier for users to access tickets, bottle service and RSVPs for nightclubs, has been acquired by Skout, a 6.5-year-old, San Francisco-based maker of a social networking app. Nixter had raised just $200,000 in angel fund; Scout has raised $22 million from investors, most of it from Andreessen Horowitz.
    Testhub, a two-year-old, Berlin-based app testing outfit, has been acquired by its better-funded U.S. competitor uTest, which has been renamed Applause. Testhub had raised an undisclosed amount of funding from WestTech Ventures. Applause, founded in 2007 and based in Framingham, Ma., has raised about $80 million from investors, including Goldman Sachs, Egan-Managed Capital, QuestMark Partners,Longworth Venture Partners, Scale Venture Partners, and MassVenture. Exact terms of the deal aren’t being disclosed, though the companies said in a statement that it was a multi-million euro deal based on cash and equity.
    —–
    People
    An SEC filing flagged by 9to5 Mac gives some sense of the enticements that former Burberry CEO Angela Ahrendts received to join Apple as its new retail chief. (Think 113,334 Apple shares, which comes out to about $68 million at today’s price, though they won’t fully vest until 2018.)
    If you live or work in Mountain View, Ca., expect some heavier-than-usual traffic on Thursday. President Barack Obama will be in town to attend that fundraiser at the headquarters of Y Combinator.
    Fred Wilson of New York’s Union Square Ventures predicted yesterday that by 2020, the biggest tech company in the world – Apple – will likely cease to be the most important, and won’t even be in the top three. More here.
    —–
    Happenings
    TechCrunch Disrupt continues. You can find its live stream here.
    —–
    Job Listings
    Rubicon Project, the newly public digital ad tech company, is looking for a VP of business development. The job is in L.A.
    For what it’s worth, the NSA is also recruiting in its own unique way.
    —–
    Data
    Chart of the day: Here’s who’s winning the smartphone market share war in China, according to the research firm Counterpoint.
    —–
    Essential Reads
    Looks like John McAfee is back from his wild adventures. His new project (or one to which he has lent his name, at least): an encrypted private messaging app called Chadder.
    Roughly 22,000 new San Francisco residents are now hunting for apartments that don’t exist.
    —–
    Detours
    Michael Pollan on “nutritionism,” food culture, and unhealthy obsessions with healthy eating.
    As you suspected: New research out of Yale and the Smithsonian provides fresh evidence that turtles are more closely related to birds and crocodiles than to lizards and snakes.
    An open letter to your unreadable hashtag.
    Larry Page’s Google business card, circa 1998.
    —–
    Retail Therapy
    Fifteen things to do at stunning tropical locations around the world.
    The best airline seat that $21,000 can buy, ostensibly. (We’d have to confirm this directly — wink, wink — Etihad Airlines.)
    “It’s so hard to describe just how incredible it is to drive this car at speed.”

    Connie

  • StrictlyVC: May 5, 2014

    Hello and happy Monday morning, everyone! We have some new formatting issues we don’t have time to address at the moment. For an easier way to read today’s edition (versus scrolling down), just click here.

    —–

    Top News in the A.M.

    Target just replaced its CEO over that massive data breach over the holidays.

    —–

    Trusted Insight, the Social Network for LPs, Look to Next Round

    Trusted Insight is a four-year-old, New York-based platform that has made itself valuable to institutional investors – 100,000 of them and counting – by giving them a place to research one another, scout out new deals and trends, and connect on due diligence — all with the help of advanced algorithms and semantic analysis.

     

    Now the 16-person company is gearing up for its next phase, suggests cofounder Alex Bangash, who previously founded Rumson Group, an advisory firm that specialized in private equity and venture investments.

     

    Most notably, the company will be unleashing some financial products of its own, though Bangash won’t be more specific than that today, citing competitors that are copying Trusted Insight down to “features we want to throw away.” He merely says to “think of us as the Netflix of investment management. Netflix can create ‘House of Cards.’ We can [create our own offerings] in this business, too.”

     

    Trusted Insight is also preparing to open its doors a bit wider to “different tribes,” says Bangash, who cites fund managers, companies, and “high net worths” who are accredited but don’t necessarily have a billion dollars behind them. (The platform will “still retain its exclusivity,” he insists.)

     

    Trusted Insight also has numerous new features up its sleeve, including “certifications” that help to highlight who is truly expert in what, regardless of their academic credentials.

     

    As for how it achieves what’s on its road map, Bangash says the company has three options, including organic growth. To wit, Bangash says Trusted Insight is poised to double or even triple its user base in the next year, as well as to increase the data it’s managing by five times. Considering that a “small but meaningful portion” of its 100,000 members already pay for one of Trusted Insight’s varying tiers of service, which range in price from $99 to $499 per month, the platform could “be a very large business on [its software-as-a-service fees] alone,” he says.

     

    A second option includes partnering with another outfit (Bangash says Trusted Insight is “talking with two or three players”) or raising a big fat round of funding, which seems like the most likely scenario. Already, Data Collective, Founders Fund, RRE Ventures, Morado Ventures, Real Ventures, and 500 Startups are among those that have invested an undisclosed amount of money in Trusted Insight. And Bangash says he’s been receiving “inbound interest from prestigious investors” anew.

     

    Either way, Bangash sounds confident in the network effects that Trusted Insight now enjoys, noting that “someone could develop a nicer LinkedIn, too, but people probably wouldn’t use it.” The trick going forward is turning Trusted Insight from a “transformational company,” as he calls it, into a transactional one.
    Founder Showcase
    New Fundings
    Electric Objects, an eight-month-old, New York-based developer of an Internet-connected screen for walls, has raised $1.7 million in seed funding led by
    RRE Ventures and First Round Capital, with participation from SV Angel and numerous individual investors, including Foursquare cofounder Dennis Crowley. Earlier investors, including Betaworks and individuals Strauss Zelnick, Nate Westheimer, and Alex Rosen, also joined the round.
    Evariant, a 5.5-year-old, Farmington, Ct.-based software company that helps health care companies launch marketing campaigns and track doctor referrals, has raised $18.3 million in Series B funding led by Lightspeed Venture Partners. Other participants included Dignity Health, Salesforce, and Health Enterprise Partners. The company looks to have raised $27.7 million in mostly equity to date, judging by Crunchbase data.
    Insightra Medical, a 13-year-old, Irvine, Ca.-based surgical device company focused on inguinal and ventral hernias, has raised $6 million in equity, shows an SEC filing. The funding might reflect the undisclosed amount of Series C financing the company announced in October of last year, co-led by Baird Capital‘s venture capital group and Tekla Capital Management.
    Kabbage, a four-year-old, Atlanta, Ga.-based provider of working capital to small businesses, has raised $50 million in Series D funding led by Softbank Capital, with Lumia Capital and TCW/Craton participating. Earlier investors Thomvest, Mohr Davidow Ventures, BlueRun Ventures, David Bonderman, SV Angel and UPS Strategic Enterprise Fund also participated. Kabbage has now raised a whopping $465 million in equity and debt financing.
    Prosper, an eight-year-old, San Francisco-based peer-to-peer lending marketplace, has raised $70 million in new funding led by Francisco Partners. Institutional Venture Partners and Phenomen Partners also participated. As Dealbook notes, the round comes less than a year after Prosper raised $25 million in a round that included BlackRock. The company has raised $190 million altogether, shows Crunchbase.
    SEE Forge, a 2.5-year-old, Perth, Australia-based reporting and analytics platform that largely targets the oil and gas industries, has raised $1 million in funding led by Mercury Fund, a Houston-based venture capital group. Correlation Ventures and unnamed gas and oil industry professionals also participated in the round. The company has raised $2 million to date.
    Sherpaa Health, a two-year-old, Brooklyn, N.Y.-based company that sells healthcare consultancy services, along with access to on-call doctors, has raised $3.9 million, according to a new SEC filing. The company’s earlier investors include SV Angel, O’Reilly AlphaTech Ventures, First Round Capital, and Collaborative Fund. The company has raised $5.7 million to date.
    SupportPay, a 2.5-year-old, Santa Clara, Ca.-based platform that automates child support payments and related expenses, has raised $1.1 million in seed funding led by Draper Associates. Other participants in the round included TEC Ventures, Broadway Angels, Aspect Ventures, RPM Ventures, and Salesforce, along with numerous angel investors.
    —–
    New Funds
    Draper Fisher Jurvetson has closed its newest growth fund, an “oversubscribed” $470 million pool, says the firm, which opened its DFJ Growth practice in 2006. The new fund, led by the same four investors who cofounded DFJ Growth — John Fisher, Mark Bailey, Randy Glein, and Barry Schuler — already counts five portfolio companies, including the location-based social network Foursquare, the space company SpaceX, and the 3D printing company Formlabs. If there was outsize demand for its newest effort, it’s no surprise, given the winners in the firm’s last growth fund, including AdMob (acquired by Google for $750 million in stock in 2009), Tesla Motors (which went public and is now valued at $26 billion), Tumblr (acquired by Yahoo in a $1.1 billion deal last year), Twitter (currently valued at $22 billion on the public market), and Yammer (acquired by Microsoft for $1.2 billion in cash in 2012). Combined with DFJ Venture XI, the firm’s recently closed, $325 million, venture fund, the firm is managing roughly $800 million in new capital.
    Nokia Growth Partners, the company’s venture capital arm, has announced plans to plug up to $100 million into new startups that bring computing and communications technologies into cars. More here.
    Northgate Capital, a 14-year-old, Danville, Ca.-based investment firm that specializes in fund of funds investments and direct investments, is raising its sixth fund of funds, shows an SEC filing that doesn’t list a target and states that the first sale has yet to occur. Northgate was founded by former San Francisco 49ers teammates and looks to have closed its sixth venture fund last year with roughly $153 million, per this SEC filing. Some of Northgate’s recent direct investments include AdRoll, the seven-year-old, San Francisco-based ad retargeting company that raised $70 million in new funding last month from a variety of investors, and Health Digital Systems, an 11-year-old, Mexico-based electronic health records company that raised $25 million last month from Northgate Capital.
    Startup Capital Ventures, a nine-year-old, Menlo Park, Ca.-based early-stage venture firm, is looking to raise a $50 million second fund, according to an SEC filing that states the firm has yet to sell any shares. The firm principally invests in Silicon Valley and opportunistically in Hawaii, Texas, and Oklahoma, where, according to its site, it has “extensive investor relationships.” It also has offices in Hong Kong and Shenzhen. Managing general partner John Dean was formerly the CEO of Silicon Valley Bank (from 1993 to 2001).
    —–
    IPOs
    Aldeyra Therapeutics, a 10-year-old, Burlington, Ma.-based clinical-stage biotech developing treatments for rare skin and eye diseases, saw its shares close Friday at $7.20, down 10 percent in their first day of trading. (Aldeyra had initially planned to offer shares at between $10 and $12.) Domain Associates owned 50.1 percent of the company heading into its IPO. Johnson & Johnson Development Corp. held 44.5 percent.
    Ambrx, an 11-year-old, La Jolla, Ca.-based biotech company developing protein therapeutics for cancers and growth hormone deficiency, has filed paperwork to raise up to $86 million in an IPO. No pricing terms were disclosed. The company’s principal shareholders are Tavistock Group, which owns 19.3 percent of the company; Maverick Capital (17.4 percent); Apposite Capital (9.5 percent); Versant Ventures (7.5 percent); and 5AM Ventures (6.9 percent).
    Zendesk, the 6.5-year-old, San Francisco-based maker of cloud-based customer service software, set a price range this morning of between $8 and $10 million for its proposed IPO. The company’s biggest shareholders, heading into an offering, include Charles River Ventures, which owns 23.8 percent of the company; Benchmark (18.2 percent); and Matrix Partners (7.2 percent).
    —–
    Exits
    LuxVue Technlogy, a four-year-old, Santa Clara, Calif.-based company that makes low-power, micro-LED-based displays for consumer electronics applications, has been acquired for an undisclosed amount by Apple. LuxVue had raised $43.8 million, according to Crunchbase, including from Kleiner Perkins Caufield & Byers.
    Rangespan, a three-year-old, London-based automated supply chain service for online retailers, has been acquired by Google for an undisclosed amount of funding. Rangespan’s founders and other employees will now work within the company’s e-commerce unit, Google Shopping.
    OVM Solutions, a 14-year-old, New Rochelle, N.Y. -based automated messaging service, has been acquired by the contact center company Genesys for an undisclosed amount of funding. Gensysys, in Daly City, Ca., is majority owned by Permira Funds. Technology Crossover Ventures is also an investor.
    Tvinci, a seven-year-old, Tel Aviv-based company whose technology helps TV operators and media companies create personalized, social TV experiences, has been acquired by Kaltura, an open source video platform. Tvinci had raised $6.1 million from Trellas Enterprises, Kaedan Capital Group, and investor
    Zohar Gilon. Kaltura, a 7.5-year-old, New York-based company, has raised roughly $116 milllion from investors, including Avalon Ventures, Commonfund, Intel Capital, SAP Ventures, Gera Venture, Nexus Venture Partners, Nokia Growth Partners, Silicon Valley Bank, .406 Ventures, Mitsui & Co.
    —–
    People
    In early March, Rakesh “Rocky” Agrawal, a veteran of America Online and Microsoft, became PayPal‘s director of strategy to help grow the company’s base of small business customers. Over the weekend, however, Agrawal’s employment ended publicly with a series of stunning tweets that Agrawal thought were private, including about Christina Smedley, PayPal’s VP of global communications. (Agrawal wrote that Smedley was a “useless middle manager” as well as a “piece of s–t.”) It didn’t take long for PayPal to issue a public tweet of its own, stating that Agrawal is “no longer with the company. Treat everyone with respect. No excuses. PayPal has zero tolerance.” Yesterday morning, Agrawal told Re/code in an email that he’d quit before sending the tweets. He also declined to apologize to the targets of his tweets, including Smedley.
    Fran Hauser — who spent more than a decade at Time Inc., including overseeing the digital businesses of top-selling magazines such as People, Entertainment Weekly, and InStyle — has a new job, reports Re/code. Last month, she joined Rothenberg Ventures, an 18-month-old early-stage venture firm founded by Mike Rothenberg, who’d previously cofounded a residential real estate investment firm with his brother in Austin, Texas. The two met via a mutual investment, says Hauser. She later became an LP in Rothenberg Ventures and was eventually asked by Rothenberg to join him as a partner. “We complement each other,” she told Recode from her home in Bedford, N.Y. “I’m an operator. I’ve built businesses, I’ve run businesses. I bring experience.”
    Thomas Weisel, the famed investment banker who personally bankrolled cyclist
    Lance Armstrong in his seven Tour de France wins, sat down with the San Francisco Chronicle to discuss life these days and Armstrong. Said Weisel, who was not named in the United States Anti-Doping Agency report that torpedoed Armstrong’s career: “I knew nothing about what (Armstrong) was doing, and I’m extremely disappointed in him and everyone involved . . .But I’ve been disappointed with a lot of people in life. I liked Lance. His training regimen was off the charts. I thought he was a gentleman of the utmost character, and he looked like a champion. It’s just one more thing that you don’t control, and you couldn’t control. Life throws you curveballs.”
    Venture capitalist Fred Wilson added his two cents to a piece published by TechCrunch over the weekend about the suddenly precarious position of both Square and Box, given that both companies have high burn rates and the IPO market has turned rocky. “[Y]ou can push valuations when you have investors knocking down your door,” writes Wilson. “But unless you are cash flow positive and expect to remain so for the foreseeable future, you do that at your own risk . . . I have lived it, felt it, and suffered from it. It is a real issue.”
    —–
    Happenings
    TechCrunch Disrupt started up today in New York. You can watch a live stream of the happenings here.
    This Thursday, 500 Startups hosts its newest Demo Day if you’d like to get a glimpse of its newest batch of startups.
    Next Thursday, May 15, the 15th annual Founder Showcase in Mountain View Ca. gets underway with featured speakers Mitch Kapor and Mike Maples, among others. (Click on the ad above for a 20 percent discount.)
    —–
    Job Listings
    The Business Development Bank of Canada (BDC) is looking for an associate director to help vet and monitor its energy and clean tech investments. The job is in Vancouver.
    —–
    Essential Reads
    It’s starting to dawn on marketers that the online video ad system has a few booby traps.
    Volvo‘s first self-driving cars are now being test live on public roads in Sweden.

    Scientists at UC San Francisco School of Medicine have been building cancer-killing nanorobots, and they appear to work.

    —–
    Detours
    You could subsist on Soylent. But would it be a good idea?
    “Mad Men” enters the future, and possibly the Peggy Olson era.
    The 17 meanest jokes from Saturday night’s the White House Correspondents’ Dinner. (One of our favorites: “Between Rob Ford, Justin Bieber and Ted Cruz, you just want to tell Canada, “Hey, hey, relax – we already have a Florida.”)
    —–
    Retail Therapy
    A pretty neat place for books.
    We like this overall concept of a “connected” bike, too.

    Connie

  • StrictlyVC: May 2, 2014

    It’s Friday! We’ll see you back here next week, when we have some great interviews lined up. In the meantime, hope you have a fabulous weekend, everyone.

    —–

    Top News in the A.M.

    Major U.S. technology companies are done quietly complying with federal investigators’ demands for e-mail records and other online data, they say.

    Activists are now suing the city of San Francisco over those Google buses. More here.

    —–

    Ted Driscoll on VC Bias in Healthcare Investing

    Ted Driscoll of Claremont Creek Ventures has been embroiled in the world of digital healthcare a lot longer than most of his industry peers. Before becoming a VC nine years ago, Driscoll, who has a PhD in digital imaging from Stanford, spent decades as a founder and executive at five diagnostics and imaging companies. Maybe it’s no wonder then that Driscoll has strong opinions about where investors who are newer to the digital health scene should be focusing their attention.

    You’ve written about confirmation bias and how “humans are good at ignoring stuff they don’t agree with.” Does that apply to healthcare investing, too, in your view?

    I think it’s one of the curses of venture capital. VCs come in with preconceived notions and it causes them to not necessarily look at the world in the future but to look at the past.

    Meaning what, more specifically?We’re in the midst of a revolution in medicine and we don’t see it. It’s becoming all digital — not just electronic records being captured and stored but diagnostic decisions that are being based on much larger data sets than doctors can fit in their heads. They need tools that find information in the data and that’s a new thing for doctors. In my memory, the guys who went to med school weren’t the computer science types, but now they need computer familiarity to cope with the huge datasets that confront them.And you think VCs aren’t funding enough of those tools?

    My personal opinion is that the most value is created by technologies that can change a doctor’s decision-making. I’m not so interested in things that tell me how many paces I took yesterday; I am interested in the wearable that monitors someone with congestive heart failure and alerts him when he needs to go to hospital. I’m interested in the cheek swab that’s going to tell a doctor that a depressed patient is going to respond to Prozac and not Celexa, so the doctor can make an informed decision rather than rely on trial and error.

    No doubt I’ll miss a Facebook along the way but I’m not seeing healthcare applications for consumers that work that well. Frankly, the many acquaintances of mine with Fitbits or Fuelbands stopped wearing them after three months.

    You note that doctors loath to adopt new technologies. How, or when, do we get past that hurdle?

    Doctors are quite aware of malpractice issues, so they tend to not want to change until they know something is going to work and not have unexpected side effects. Another issue is the way reimbursement works. Certain tests might be valuable, but because a doctor knows he or she won’t be reimbursed until the following year [they might hesitate to use that test] or else exaggerate the patient’s condition to ensure they’re reimbursed for the treatment [more quickly]. Our reimbursement system is total anarchy, with different practices across every state. Is there a reimbursement code for this? Does Medicare reimburse that? Worse, it changes from year to year.

    The good news: as the medical community begins to understand this whole world of information under the surface that can help them, and lots of tests are getting approved [by the FDA], that information is getting back to reimbursers, and they’re coming around. Five years ago, I wouldn’t have invested in a genetic test. Now, I have.

    cpc2
    New Fundings

    Augment, a 2.5-year-old, Paris-based company whose mobile app allows users to visualize products in augmented reality, has received $1.5 million in funding from individual investors. The company has raised $1.8 million to date.

     

    CertiVox, a six-year-old, London-based security company that sells information security infrastructure-as-a-service, has raised $8 million in Series B funding from NTT Docomo Ventures. Earlier investor Octopus Investments also participated in the round, which brings the company’s total funding to $17 million.

    Data Elite, a months-old, San Francisco-based incubator for data science startups, introduced its first class of seven companies yesterday, each of which has raised $150,000. Learn more about them here. Data Elite was founded by Tasso Argyros, co-founder of data-analytics company Aster Data Systems, and Stamos Venios, an M&A veteran, and is backed by Andreessen Horowitz, Formation8, Social + Capital Partnership and investor Ron Conway, among others.

    EnergySavvy, a 4.5-year-old, Seattle-based company whose online tools help utilities operate energy-efficiency programs, has raised $7 million in new funding led byPrelude Ventures, which was joined by earlier investors, including Pivotal Investments. The company has raised $12.9 million altogether, shows Crunchbase.

    Enterome Bioscience, a two-year-old Paris-based company that’s developing biomarkers for medical conditions relating to metabolic and bowel diseases, has raised $16.8 million in Series B funding led by its existing investorsSeventure, Lundbeckfond Ventures, and Omnes Capital.

    Halo Neuroscience, a 1.5-year-old, New York-based company whose wearable headband device purports to “boost brain function,” has raised $1.5 million in seed funding led by Marc Andreessen of Andreessen Horowitz and Jeff Clavier of SoftTech VC. More here.

    Intent HQ, a nearly four-year-old, London-based company whose software creates a so-called interest profile of every Website visitor based on both his or her social profile, along with what that person reads and clicks on, has raised $8 million in funding led by Oxford Capital. Earlier investor Edge Performance VCT also participated.

    Kamcord, a 2.5-year-old, San Francisco-based company whose application allows users to record and share mobile games they’ve played via Facebook, Twitter, YouTube, and email providers, has raised $7.1 million led by TransLink Capital. Other participants in the round included new investors SV Angel, DeNA, KLab and M&Y Growth Partners, and earlier investors Innovation Works, XG Ventures and Mark Williamson. Kamcord has raised $9.6 million to date, shows Crunchbase.

    Lecorpio, a 7.5-year-old, Fremont, Ca.-based maker of cloud-based intellectual property management and analytics software, has raised $10 million in Series B funding led by the family office M2O Inc.

    MakeSpace, a year-old, New York-based full-service storage company, has raised $8 million in Series A funding led by Upfront Ventures, with participation from Founders Fund and O’Reilly AlphaTech Ventures. Earlier investors Lowercase Capital, High Peaks Venture Partners and Collaborative Fund  also participated in the round, which brings the company’s total funding to $10.1 million.

    MediaREDEF, a years-old, New York-based daily email, site, and soon-to-be app, has raised $2.25 million in seed funding led by Bloomberg Beta. Other participants in the round include The Chernin Group, Greycroft Partners, and high profile individual investors like Jeffrey Katzenberg, Mark Cuban, Troy Carter and James Murdoch. Re/code has more here.

    Pubmark, a two-year-old, Cambridge, Ma.-based startup that helps publishers and authors sell their books online and is better known as BookBub, has raised $3.8 million in Series A funding led by NextView Ventures and Founder Collective. Other participants in the round included Avalon Ventures and Bloomberg Beta.

    PunchTab, a three-year-old, Palo Alto, Ca.-based company that sells customer-engagement technology, has raised $6.25 million in new funding led by earlier investorMohr Davidow Ventures. The company has now raised $11.5 million to date, shows Crunchbase.

    Shop.Ca, a three-year-old, Toronto-based online shopping website, has raised $31 million in Series B funding led by Shaw Ventures and other, undisclosed financial institutions. Earlier investors, including Torstar and Difference Capital, also participated in the funding.

    Tresorit, a three-year-old, Budapest, Hungary-based maker of cloud-based, secure file synchronizing and collaboration software that enables business users to share confidential data, has raised $3 million in Series A funding led by Euroventures, as well as earlier backers, including individual investors Andreas Kemi and Marton Szoke. The company has raised $5 million to date.

    Waggl, a months-old,San Francisco-based startup that makes polling software, has raised $1.1 million in seed financing from numerous individual investors, including Robert Hohman, the former president of Hotwire and founder of Glassdoor.

    —–

    New Funds

    Highway1,     a year-old San Francisco-based incubator for hardware startups, announced yesterday that its fall 2014 program is now open to new applicants. It also announced that companies that pass through the program will now receive $50,000 each, up from $20,000. StrictlyVC had profiled Highway1 last month.
    —–
    IPOs
    ProteinSimple, a 10-year-old, Santa Clara, Ca.-based company whose tools analyze proteins that can be used as drugs or biomarkers, is looking to raise $86 million in an IPO,  shows paperwork it filed yesterday for an IPO. ProteinSImple, which changed its name from Cell Biosciences in 2011, is principally owned by Domain Associates, which owns 11.6 percent of the company; Essex Woodlands Health Ventures, which owns 14.6 percent; LVP Life Science Ventures, which owns 8.1 percent; Novo A/S, which owns 12.1 percent; and Wellcome Trust Investments, which owns 19.6 percent.
    —-

    Exits

    Awe.sm, a four-year-old, San Francisco-based company whose software helps measures the performance of social marketing campaigns, has been acquired by Unified, a New York-based cloud technology company. No terms were disclosed. Awe.sm had raised $5.3 million from investors, including Upfront Ventures, Neu Venture Capital, and Foundry Group.

    CrowdStream, a three-year-old, New York company that had developed an “at-event engagement platform,” was acquired yesterday by RadioIO, a publicly traded company. Terms of the deal weren’t announced.

    SpaceClaim, a nine-year-old, Concord, Ma.-based direct modeling software company, has been acquired by Ansys, a publicly traded developer of advanced simulation software for engineers for $85 million in cash. SpaceClaim had raised $50 million over the years, including from Needham Capital Partners, Borealis Ventures, North Bridge Venture Partners, and Kodiak Venture Partners.

    —–

    People

    Venture capitalist Vinod Khosla is reportedly refusing to come to court to testify about blocking public access to a popular surf spot. Vinod Khosla is being sued by the Surfrider Foundation over the closing of Martin’s Beach, just south of Half Moon Bay, where Khosla acquired land in 2008.

    John Melas-Kyriazi is the newest associate of Spark Capital in Boston. The Boston-native was formerly the CFO of the Palo Alto, Calif-based startup StartX, a venture capital fundformed out of a partnership between Stanford University and the Stanford Hospital & Clinics. It’s worth noting that Spark Capital is among those firms that believe strongly in the apprenticeship model. General Partner Mo Koyfman had joined the firm as a principal in the latter half of 2008. (He was promoted in 2012.)  More recently, Spark promoted Andrew Parker to the role of general partner. Parker has been with Spark since 2010, joining the firm as an associate; he was promoted to principal less than a year later and made a GP last October.

    —–

    Esssential Reads

    Foursquare has split itself in two.

    Amazon‘s smartphone revealed . . . to look a lot like every other smartphone.

    Don’t cry, Twitter. The Atlantic has predicted certain doom for many before you.

    Founders with kids.

    —–

    Detours

    Foursquare has split itself in two.

    Amazon‘s smartphone revealed . . . to look a lot like every other smartphone.

    Don’t cry, Twitter. The Atlantic has predicted certain doom for many before you.

    Founders with kids.

    —–

    Retail Therapy

    Go zero to 60 miles per hour in 3.7 seconds and look fine doing it.

    An entire collection of gear inspired by the carpet from The Shining’s Overlook Hotel.

    Tony Stark’s house is for sale, people.

    —–

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    Connie

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