It is Friday! Wunderbar! Major thanks to investor-writer Semil Shah, who has been an enormous help over the last three weeks while Connie spent a little quality time offline, finishing her kit car. If you want to talk with him about his column in today’s newsletter, you can find him here on Twitter.

Also, thanks very much to the many of you who’ve volunteered to help with next month’s event in San Francisco. This readership is the best, truly. We’re still trying to figure out exactly how many people we need, but we’ll let each of you know what’s up as soon as we get things sorted (either today or Monday).

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Top News in the A.M.

Alphabet, the new parent company of Google, has a new company in its portfolio: Ingress, an internal unit that was just spun out on its own.

Apple customers waiting for the company to revolutionize live television will have to wait until next year.

Uber just won the dismissal of lawsuit by 15 Connecticut taxi and limousine companies seeking to stop it from doing business in the state.

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To Atomize or to Grow?

By Semil Shah

The growth in micro VC funds is now well-documented. While there are many reasons to explain why this trend took hold, the more interesting question to ask is: What will happen to those funds which survive?

Grow the Team

A natural desire of any entrepreneurial endeavor — including starting a fund — is to keep growing it. In the context of small funds, traditional LPs will naturally hope this new crop of managers who emerge will grow a franchise, will add people to the team, and ultimately manage more money. Eventually, some of these franchises can grow to manage quite a bit of money per fund per GP and can, in effect, become a new type of Series A firm. This is the theory. It remains to be seen if more than just a few can make this transition, as the models at seed versus Series A are obviously quite different.

Stay the Course as Lone Wolf

While it may sound traditional to turn a good micro VC fund into a more traditional venture franchise, creating a strong general partnership is not a simple, check-the-box activity. Noting the difficulty, some micro VCs have opted to stay as solo operators longer than LPs had imagined. (See Manu Kumar.) Some, of course, continue to outperform and earn the right to manage more money per fund (if they choose to). In this instance, the LPs aren’t able to invest more and more of their funds into the GP. In the same way a large VC fund may look for opportunities to increase their ownership in a great company in their portfolio in order to make its own economics work, a large LP will often have a similar desire.

Differentiate and Evolve

Just as investors may have “app fatigue” or “food delivery service” fatigue, LPs pitched by micro VC funds have their own flavor of fatigue. As a way to cut through the noise, many of them drill into what differentiates a GP they’re considering an investment in. This can nudge micro VCs to differentiate on the basis of sector (hardware, Bitcoin, etc.), or geography (focusing in emergent areas outside the Valley especially), or stage (pre-seed vs seed, etc.), and more. And the success of Y Combinator and the potential for more steady budgets for an accelerator or incubator could encourage more to let go of the traditional fund model altogether.

I know these choices because I have been faced with them. The LPs rightly ask these questions and conduct references to determine which way the micro VC wants to go. But the truth is that, just like most at seed don’t know how well a company will do at the very early stages, most of them also don’t know what the optimal path to take is. This can lead to an awkward discussion, where LPs may want or need to hear certain things to “check the box” in their processes versus having the raw discussion about what is working and what doesn’t. The truth is that most people don’t know, and in this market, which is changing year to year, the main value in these smaller funds is that their inherent nimbleness by virtue of being small gives them the right level of flexibility to adapt to a dynamic, ever-changing environment.

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New Fundings

ChatID, a four-year-old, New York-based startup that helps businesses instant message to communicate with their customers, has raised $11.2 million in Series B funding led by Costanoa Venture Capital. The company has now raised $19.2 million altogether, including from earlier investors FirstMark Capital and Mack Capital. More here.

EShares, a three-year-old, Mountain View, Ca.-based company that stores data about private companies’ ownership and value, has raised $17 million in Series B funding led by earlier investor Spark Capital, says VentureWire. Other participants in the round include Union Square Ventures, Subtraction Capital, and Industry Ventures.

GrabTaxi, the four-year-old, Singapore-based smartphone booking and dispatch platform that competes with Uber in Southeast Asia, is about to close a $400 million round of funding led by China Investment Corp (CIC), China’s sovereign wealth fund, reports the WSJ. The company has already held a first close on $200 million led by Coatue Management.

Intelex, a 23-year-old, Toronto-based maker of environmental, health, safety, and quality management software, has raised C$160 million ($122.9 million) in growth equity funding led by JMI Equity, with participation from HarbourVest.More here.

The Honest Company, a four-year-old, Santa Monica, Ca.-based company that sells eco-friendly baby and cleaning products, has raised $100 million in Series D funding led by new investor Glade Brook Capital Partners. Other participants in the round include AllianceBernstein and earlier backers Fidelity Management & Research Company, Wellington Management Company and Institutional Venture Partners.

Massdrop, a three-year-old, San Francisco-based online discussion platform for gatherings of particular enthusiasts (from audio to cooking), has raised $40 million in Series B funding led by August Capital, with participation from earlier backers Cowboy Ventures, First Round Capital, and Mayfield. The company has now raised $47.9 million altogether. TechCrunch has more here.

Rift.io, a two-year-old, Burlington, Ma.-based company that aims to deliver scalable network virtualization to enterprises, has raised $16 million in Series A funding led by North Bridge Venture Partners, with participation from unnamed strategic investors. More here.

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New Funds

Elephant Partners, a growth equity firm launched earlier this year by former Highland Capital Partners investors Jeremiah Daly and Andy Hunt — they also cofounded the eyeglasses company Warby Parker — is seeking up to $125 million for its debut fund. The WSJ has much more here.

Rocket Internet, the eight-year-old, Berlin, Germany-based publicly traded internet company founded by the Samwer brothers, is raising up to €1 billion ($1.1 billion) for a growth fund, according to the German business publication WirtschaftsWoche (WiWo). Reportedly, the vehicle will be named, simply, Rocket Internet Growth Fund. Tech.eu has more here.

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People

Apple CEO Tim Cook on the company’s latest diversity numbers: “There’s a lot more work to be done.” TechCrunch has more here.

Zirtual founder Maren Kate Donovan blamed the company’s collapse, in part, on an outsourced CFO that she would not name. That individual now tells Fortune his side of the story here.

Bill Maris of Google Ventures says that having a new parent company, Alphabet, doesn’t change things for his group (if you were curious). More here.

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Jobs

RRE Ventures is looking to hire a director of platform. The job is in New York.

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Essential Reads

VW has spent two years trying to hide a big security flaw. Bloomberg has the story here.

But when will they go public? A profile of the average company at IPO.

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Detours

Inside the secret dating app for famous people.

Ten untranslatable words, beautifully illustrated.

Things that will happen if I don’t take my phone out right now.

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Retail Therapy

Apple (pocket) Watch.

The world’s largest hard drive, courtesy of Samsung. (It can store up to two years of video.)

Hi, everyone, happy Thursday morning! (Or afternoon, or evening, depending on where you are.)

We don’t have a column for you today. We do, however, have a request for two volunteers to join team StrictlyVC the night of our next event, on September 16. Are you a business school student who is also skilled in checking in guests and handing a microphone from one attendee to another during audience questions? We want to hear from you.

In the meantime, giant thanks again to our friends at Bolt, GLG, and Ludlow Ventures for helping us put the evening together, including making sure we have a top-notch venue, delicious food and drinks, as well as some giveaways for guests.

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Top News in the A.M.

Tesla just announced a $500 million common stock offering. (CEO Elon Musk says he’s buying up $20 million worth at the offering price.)

Russia has banned Reddit.

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New Fundings

BigBasket, a four-year-old, Bangalore, India-based company that has become one of India’s largest online grocers, just raised $50 million in new funding at $400 million valuation led by Bessemer Venture Partners. And it’s preparing to raise another $150 million soon, according to a local outlet. More here.

PokitDok, a four-year-old, San Mateo, Ca.-based cloud-based API platform that aims to make healthcare transactions more efficient, just raised $34 million in Series B funding led by Lemhi Ventures. The company has now raised $42.6 million altogether, shows Crunchbase. Its earlier backers include New Atlantic Ventures, Rogers Venture Partners, and Subtraction Capital. More here.

Sarvint Technologies, a year-old, Atlanta, Ga.-based wearables technology company whose “smart shirt” detects and monitors users’ vital signs, has raised $6 million in Series A funding led by CTW Venture Partners, with participation from Monta Vista Capital and Maxim Ventures. More here.

Tanium, an eight-year-old, Emeryville, Ca.-based cyber security startup that can detect and fix enterprise threats in seconds and which is funded solely by Andreessen Horowitz, is raising a new round of funding at a valuation of at least $2.5 billion, according to Fortune. One of the outlet’s sources suggests the final figure could top $3 billion. StrictlyVC talked with Tanium in March when it raised its last big round of funding. (Worth noting: It had hardly touched any of its funding at that point.)

Who What Wear, a nine-year-old, L.A.-based e-commerce fashion site, has raised $8 million in Series B funding from Amazon and Bertelsmann Digital Media Investments, with participation from earlier investors Greycroft Partners, Lerer Hippeau Ventures, Advancit Capital, Mesa Ventures, and Double M Partners. TechCrunch has more here.

View, a nine-year-old, Milpitas, Ca.-based company that makes so-called dynamic glass (it maximizes natural light while reducing heat and glare), has raised $150 million in new funding from NZ Super Fund, Corning Inc., Madrone Capital Partners and unnamed real estate investors. Forbes has more here.

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New Funds

Lightspeed Venture Partners, the 15-year-old, Sand Hill Road venture firm which began investing in India in 2004, has raised $135 million for a new, India-dedicated fund, reports Techportal. MediaNama features some of its latest bets here.

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IPOs

Pure Storage, a six-year-old, Mountain View, Ca.-based all-flash enterprise storage company, has filed to go public. The company has raised roughly $530 million from investors over the years, shows Crunchbase. Its biggest backers include Greylock Partners, which owns 17.3 percent of the company; Sutter Hill Ventures, which owns 27.4 percent; and Redpoint Ventures, which holds a 5.7 percent stake. Recode has more here.

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Exits

This week, financial services software company Envestnet agreed to buy data aggregator and technology company Yodlee for nearly $590 million —  a 50 percent premium over its public market value. Fortune takes a look at why (rich pricing aside) Yodlee sold.

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People

Smartphone maker HTC Corp. says it’s cutting 15 percent of its workforce as it struggles to attract customers in a maturing smartphone market. The WSJ has the story.

Harvard student Aran Khanna was preparing to start a coveted internship atFacebook when he launched a browser application from his dorm room that drew attention to a significant privacy flaw — as well as got his internship revoked. The Boston Globe has the story here.

Chris Payne, a former eBay and Microsoft exec who was hired as Tinder‘s CEO in March is leaving, having proved not a good “fit,” according to board member Matt Cohler of Benchmark. Payne is being replaced by company cofounder Sean Rad. Recode has much more here.

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Jobs

Andreessen Horowitz is looking to hire a research and data analyst. The job is in Menlo Park, Ca.

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Data

Solar funding continues to plummet globally, according to new data from Mercom Capital Group, which shows funding dropped to $5.9 billion in the second quarter from $6.4 billion in the first quarter. The downward trend has persisted over the past five quarters, says the firm. More here.

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Essential Reads

Facial recognition software moves from overseas wars to local police.

The tax law that is (unintentionally) hammering Silicon Valley employees.

Last week, Recode reported that NBCUniversal was investing in BuzzFeed and Vox Media. Now those deals are done. More here.

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Detours

Americans are having the most babies in these cities.

For KKR employees, nannies fly free.

A treehouse with 80 rooms.

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Retail Therapy

Dress your age: Tips from Mr. Porter.

Happy Wednesday, dear readers! Investor-writer Semil Shah remains in charge of our columns for another week or so while Connie plays “Galaga” at an undisclosed location. If you have questions or comments, you can find him right here on Twitter.

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Top News in the A.M.

Facebook is reportedly working on a stand-alone mobile news application that sounds a lot like Twitter. Business Insider has more here.

Amazon has quietly shuttered product ads that drove traffic to outside sites. Reuters has the story.

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Jenny Lee of GGV Capital of What to Know Now About China

By Semil Shah

Jenny Lee of GGV Capital knows China. She set up the Shanghai practice of the cross-border venture firm a decade ago, and her performance since earned her the number 10 slot on Forbes’s Midas List earlier this year. It was the first time a woman has broken into the list’s top 10 dealmakers and hers represented the highest ranking ever for a woman in the list’s history. (Among Lee’s prescient bets: Leading an investment in the privately held smartphone maker Xiaomi, which was valued at $45 billion as of last December — a figure that billionaire investor Yuri Milner has said will look quaint soon enough.)

We talked with her recently about what, exactly, is happening in her vast backyard right now.

A few weeks ago, the Chinese economy was the talk of the town. Can you summarize what happened and what we should expect moving forward?

The Chinese stock market, which is largely retail driven, took a dive for a few consecutive weeks and resulted in a series of panic selling. The government had to step in with measures to calm down the market, including putting a temporary halt on new IPOs, halting trading on [other stocks], and encouraging the state-owned companies to acquire shares of “undervalued” listed companies in order to restore confidence in the market.

It is important to understand that the Chinese stock exchanges are still relatively young, and over the years they’ve been steadily opening up and attracting more institutional investors similar to international markets. However, the transition will take time and investors in China will need to have a strong stomach for such fluctuations. For example, the IPO market has been halted more than 8 times in the last 20-plus years whenever retail frenzy takes hold. But from a long-term perspective, the direction is toward more openness and transparency and on cultivating an investor base that is more institutional versus retail driven.

How has the correction in Chinese markets affected early-stage entrepreneurship in China? Do you believe it could have any affect on what’s happening in the U.S.?

Historically, only traditional and local companies –stated-owned, manufacturing, etc. — have been listed locally. The markets have profitability listing rules that have made it harder or impossible for technology companies to fund raise or list in the local markets. But despite past events, early-stage entrepreneurship in China (which, interestingly is largely technology and internet driven) continues to flourish and we see a record number of startups every day.  Good quality companies will always be able to find a listing venue either offshore or onshore when they are ready.

I believe China entrepreneurship will continue to generate some of the biggest returns in tech history, and for those who are familiar with China and the China-based VC managers who have generated real returns for their investors, the market will continue to be a hot spot for fund inflows.

On a short-term basis, any impact in the U.S. will likely be felt most by the Chinese ADRs listed in the U.S. whose stock prices see huge downwards pressure when their investors take profits to fulfill their margin calls for their domestic positions in the China stock market.

What are three characteristics of the typical Chinese mobile consumer that entrepreneurs in the West don’t fully comprehend?

Chinese mobile consumers are not one homogenous segment but rather highly segmented by age, usage behavior, demographics gender, location, and more. A 14-year-old female teenager living in Anhui province is very different from a 40-year-old woman working in Shanghai. For example, companies can target the “average joe” segment, also known as “diaosi” users, or target the “aspiring” segment, also known as “baifumei.” Both are huge consumer segments in China.

Another thing: Chinese companies prefer the subscription model, virtual currency/ items, commerce model versus a pure ad-based model.  Most people do not consume ads online, especially on mobile.

Also worth noting is that a lack of a fully built-out offline retail and services in second- and third-tier cities in China means that many services and products are not available offline. Variety and convience factors are lacking. Hence mobile commerce is a very natural transaction-based value for users.  Thanks to Alipay and Tencent’s further efforts to tie users’ phones to payment providers, the ease of payment has greatly enhanced e-commerce, and anytime anywhere transactions via the mobile devices.

As a long-time observer of Baidu, Alibaba, Tencent, and Xiaomi, do you expect them to be acquisitive in the U.S. as a means of deepening their ambitions in America?

Yes, you will start to see more Chinese companies expand overseas after they have “conquered” enough market share in China. The question is not whether they will come but when they do come, how U.S. companies will feel about feeling acquired by a Chinese company.

How does the Chinese startup ecosystem perceive Silicon Valley today? Is it seen as something to mimic, or something that could be leapfrogged given China’s enormous market power?

It’s seen as place that is driven by innovation and where the tech talent lives in the U.S. Many CEOs see Silicon Valley as a very complementary talent pool to their teams as they try to expand overseas. There’s also a large pool of Chinese engineers and entrepreneurs who have spent the last 10 to 20 years living or working in the U.S., who are now ready to return home to China.

It’s not about “mimicking” the U.S., since China is already more advanced in terms of mobile user base, mobile adoption and usage behavior. Also, the Chinese don’t view the U.S. as the center of the universe.  For overseas international markets, the U.S. is just one of the markets. They can also address the India market, the South American market or the Southeast Asia market, among others. In many cases, it makes more sense to address other markets first before the U.S. as Xiaomi has done.

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New Fundings

Allygrow Technologies, a months-old, Pune, India-based engineering services company, has raised $20 million in funding led by Zodius Technology Fund, with participation from founder Prashant Kamat and IT industry veteran Atul Nishar.

C2FO, a seven-year-old, Fairway, Ks.-based online business-to-business marketplace for working capital, has raised $40 million in fresh funding led by Temasek, with participation from Tiger Global Management, Union Square Ventures, Summerhill Venture Partners, OPENAIR Equity Partners, and Mithril Capital. More here.

Cenx, a six-year-old, Jersey City, N.J.-based company that provides interconnect services for the new generation of Ethernet-based backhaul networks, has raised $12.5 million in Series D funding from BDC Capital, Mistral Venture Partners, and VMware, with participation from earlier backers Highland Capital Partners, Mesirow Financial Private Equity, Verizon Ventures, Ericsson, DCM Ventures, and Cross Creek Advisors. More here.

DoubleDutch, a four-year-old, San Francisco-based company whose mobile applications aim to capture and surface data from live events and conferences, has raised $45 million in Series E funding led by KKR, with participation from Bessemer Venture Partners, Index Ventures and Enspire Capital. The company has now raised nearly $80 million to date. TechCrunch has more here.

HUVRData, a year-old, Austin, Tex.-based data analytics company that uses drones to inspect industrial assets and acreage, has raised $2 million in funding from backers, including Central Texas Angel Network, Houston Angel Network, and the Texas HALO Fund.

Illumitex, a 10-year-old, Austin, Tex.-based LED innovator and maker of precision LEDs, has raised $16 million in Series C funding led by outside investor WP Global Partners. Other participants in the round include New Enterprise Associates, Morgan Creek Capital, Mousse Partners, Apex Venture Partners, Syngenta Ventures and numerous individual investors. Venture Capital Dispatch has more here.

Kineticor Resource, a 2.5-year-old, Calgary, Alberta, Canada-based energy services company that purchases, develops, and owns power projects, has raised $80 million in funding from Harbert Power. More here.

Lightricks, a two-year-old, Jerusalem-based startup behind the popular selfie app Facetune, has raised $10 million in its first external funding round. Carmel Ventures led the financing. TechCrunch has more here.

Ovid Therapeutics, a 1.5-year-old, New York-based biopharmaceutical company focused on developing therapies for rare and orphan diseases of the brain, has raised $75 million in Series B funding led by Fidelity Management & Research Company, with participation from Cowen Private Investments, Sanofi-Genzyme BioVentures, Tekla Capital Management, Sphera Global Healthcare Fund, Jennison Associates, Redmile Group, and Cormorant Asset Management, as well as earlier backer DoubleLine Equity Healthcare Fund. Xconomy has more here.

PaidEasy, a year-old, New York-based mobile payments application that allows people to connect with merchants to easily view and pay a bill, has raised $2 million in seed funding from South African industrialist Ivor Ichikowitz. More here.

Hi, happy Tuesday, all! No column today.

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Top News in the A.M.

Meet Alphabet, the new parent company to Google and a bunch of other businesses, including the R&D biotech company Calico, Google Ventures, Google Capital, Nest Labs, Google X, and Life Sciences, which is a business focused on health efforts. Google itself remains parent company to a variety of business units that it has already long overseen, including YouTube, Android, maps and apps.

Sundar Pichai, who has been in charge of product and engineering for Google’s internet businesses, is now top tog at Google. Larry Page and Sergey Brin are now CEO and president, respectively, of Alphabet.

Bloomberg Business has more on why it makes sense for the conglomerate to separate out its lucrative businesses from its more speculative ones here.

TechCrunch walks readers through the tech behind each letter in Alphabet.

Meanwhile, investors, who still digesting the restructuring, give it an early thumbs up.

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New Fundings

Bounce Exchange, a five-year-old, New York-based startup that helps websites advertise against their user behavior, has raised $6.45 million in new funding led by angel investor Justin Yoshimura, with participation from Contour Venture Partners, Primary Venture Partners, and New York Yankees’ All-Star Alex Rodriguez. TechCrunch has more here.

Crowdcube, a five-year-old, London-based crowdfunding platform, has raised £6m ($9.3 million) in new funding led by Numis, a U.K.-based stockbroker.Tim Draper and London-based Draper Esprit have also joined the new round, alongside earlier backers Balderton Capital. More here.

Editas Medicine, a two-year-old, Cambridge, Ma.-based company that’s aiming to precisely edit DNA to potentially treat fatal genetic diseases, has raised $120 million from investors led by Boris Nikolic, formerly an adviser on science and technology to Microsoft co-founder Bill Gates. Other investors include Deerfield Management, Fidelity Management & Research Co., and Silicon Valley investors Google Ventures and Khosla Ventures. Bloomberg has more here.

Grey Orange, a four-year-old, Gurgaon, India-based company that makes automated warehouse robot workers, has raised $30 million in Series B funding led by Tiger Global Management, with participation from earlier investor Blume Ventures. TechCrunch has more here.

Groupon, the seven-year-old, Chicago-based daily deals company, says Sequoia is investing an undisclosed amount in its Groupon India unit, adding that Groupon will “remain a significant shareholder.” More here.

Livspace, a three-year-old, Bangalore, India-based interior design and home furnishings e-commerce startup, has raised $8 million in Series A funding from Helion Venture Partners, Bessemer Ventures Partners and Jungle Ventures, along with numerous, unnamed angel investors. TechCrunch hasmore here.

pCloud, a two-year-old, Zug, Switzerland-based cloud storage company, has raised $3 million in funding from unnamed individual investors. More here.

PHEMI, a two-year-old, Vancouver, Canada-based company whose software for hospital EMRs, databases, and information systems aims to streamline care pathways, has raised $12.2 million in new funding co-led by CTI Life Sciences Fund and British Columbia Discovery Fund, with participation from earlier investors BDC Capital Healthcare Venture Fund and Yaletown Venture Partners.

Prodigy Finance, an eight-year-old, London-based online lending platform that pairs alums and other investors with students needing loans for their postgraduate studies, has raised $12.5 million in funding led by Balderton Capital, with participation from numerous angel investors. As part of the transaction, the company has also reportedly raised $87.5 million in debt fromCredit Suisse. Tech.eu has more here.

StyleLounge, a three-year-old, Zurich, Switzerland-based metasearch engine for clothing and lifestyle products, has raised an undisclosed amount of Series A funding from TA Ventures, Axivate Capital, ASTUTIA Ventures, a number of family offices, and Felix Jahn, a former managing director at  Rocket Internet who StyleLounge counts as a co-founder.  TechCrunch, whose sources place the round at roughly $2.5 million, has more here.

Turing Pharmaceuticals, a year-old, New York-based biopharmaceutical company founded by former hedge fund manager Martin Shkreli, has raised $90 million in Series A funding from Shkreli, along with unnamed equity investors and debt providers. Shkreli has most recently founded a similar company, Retrophin, in 2012 but was ousted from his role as CEO last year. Xconomy has much more here.

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New Funds

Insight Venture Partners, the 20-year-old, New York-based venture capital and private equity firm, just announced the closing of Insight Venture Partners IX, L.P., a $3.29 billion fund, and Insight Venture Partners Growth-Buyout Coinvestment Fund, L.P., a $1.46 billion co-investment vehicle that will co-invest in earlier deals that the firm has led. In case you don’t have your calculator at the ready, that’s a stunning $4.75 billion altogether. More here.

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Exits

The Carlyle Group is acquiring data storage and server management businessVeritas from Symantec for $8 billion, the companies announced this morning. The newly-independent company will be led by CEO Bill Coleman, the founder and former chairman and CEO of BEA Systems. More here.

Zirtual, a four-year-old, Las Vegas-based company pairing customers with on-demand virtual assistants, is “pausing all operations,” it announced yesterday. It cited “a combination of market circumstances and financial constraints.” Zirtual has raised $5.5 million in equity and debt financing, shows Crunchbase. Its investors include Jason Calacanis, Mayfield Fund, Recruit Strategic Partners, Structure Capital, TenOneTen Ventures, and VegasTechFund. More here.

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People

A federal judge has refused to throw out a lawsuit filed by a games publisher accusing Oculus VR and its cofounder, Palmer Luckey, of stealing trade secrets and code in the creation of the Oculus virtual-reality headset. The ruling is a win for ZeniMax Media, the game publisher that sued Oculus last year, saying that some help its then-employee, John Carmack (who designed “Doom” and “Quake”), provided Luckey as he was starting Oculus was illegal. The New York Times has more here.

Content discovery company StumbleUpon was unable to secure additional venture capital funding and is now letting go of up to 70 of its 100 employees by the end of this week, reports VentureBeat. More here.

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Jobs

FundersClub, a platform that matches accredited investors with tech startups, is looking for a venture analyst. The job is in San Francisco.

Kapor Capital is looking to hire both an analyst and an associate. The jobs are in Oakland, Ca.

Orange, the telecommunications company, is looking to hire a tech and market trends analyst. The job is in San Francisco.

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Essential Reads

“Stop reverse engineering our code already.”

The ultimate guide to doing anything in Slack.

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Detours

An hilarious (saucy) take on Tesla’s new charger prototype.

The case for chili peppers.

How to make a killer cheese platter.

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Retail Therapy

J.K. Place, Capri.

Hi, happy Monday, everyone! Hope you had a terrific weekend.

Connie is off searching for sea glass at the moment, but you’re in good hands with writer-investor Semil Shah, who is continuing to manage the column portion of the newsletter for the rest of this week. If you’d like to reach out to him, you can find him right here.

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Top News in the A.M.

Early Friday morning, Business Insider noted that Twitter CFO Anthony Noto was the only senior exec who had bought stock in 2015. Maybe it’s a coincidence, but Friday, Twitter cofounder and interim CEO Jack Dorsey decided to buy some shares, too.

Eek. The FAA says that crews on four different flights spotted a drone while on final approach into Newark, N.J., yesterday. The pilots didn’t need to take evasive maneuvers, but the agency says it’s seeing a growing number of close encounters.

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Quick Chat with Anamitra Banerji of Foundation Capital

By Semil Shah

A number of early Twitter employees have landed at venture firms over the years. Think Mike Abbott, a former VP of engineering who is today a general partner at Kleiner Perkins Caufield & Byers. Or Ryan Sarver, former director of platform at Twitter who is today a partner at Redpoint Ventures. Or, more recently, Jessica Verrilli, a former director or corporate development at Twitter who joined Google Ventures in late spring.

Anamitra Banerji, who spent two-and-a-half years as a product manager at Twitter, has also carved out a new career for himself as a venture capitalist after becoming a partner at the 20-year-old venture firm Foundation Capital in late 2012. (Earlier gigs include years of leading product development and marketing for Yahoo’s performance display ad product, and roles with Overture and Tata Consultancy Services.)

We recently talked with Banerji about his role at Foundation — which is currently raising up to $325 million for its eight fund, according to a months-old SEC filing — to see how things are going.

Two of your board seats are in NYC, and you’ve only been in VC a few years. How do you manage to stay engaged with them and live on the West Coast?

Great startups are being built outside of Silicon Valley all the time, especially in NYC and Boston. Some of these startups have been exceptionally successful – DoubleClick, Tumblr, and Etsy to name just a few. I am sure we will see iconic companies from the East Coast soon, too, and hopefully a few of them will be from our portfolio. But there’s no doubt that as a West Coast-based board member, the company-building effort on the East Coast is harder work with a greater board load.

A high degree of trust and communication is key to staying top of mind if you are not there in person. This means regular texts and calls with the CEOs and management. One of the things I used to do at Twitter is to send out a weekly email to everyone with three good and three bad things that happened during the week – just six brief bullets – to keep everyone posted on what’s going on. Some of our portfolio CEOs have adopted the same communication format, which increases the ambient intimacy I have with these remote companies.

Foundation seems to be hosting and organizing a lot more events throughout the week. Has that always been the case, or is this a conscious decision to be out in the community more?

We have always done function- and category-specific events aligned with areas of interest for my partners, such as design, fintech, marketing tech, and security. My focus has been consumer and product and our Product Minds Dinner series is part of that. We also brought on board Meg Sloan [who worked in business marketing at] Facebook, who is our VP of Marketing. Meg has been weaving her magic through the firm and our portfolio companies, and her focused efforts are adding fuel to the fire.

Your career has been consumer and ads, but you’ve made some SaaS investments, too. How do you prepare for these new areas as a VC?

I started my career as an engineer, and then switched to product management – at Overture, Yahoo and Twitter. When it comes to new investment opportunities, I operate from a product primitive, irrespective of the category. When it comes to the SaaS companies that I am involved with, I have found two things very compelling about them. First, the products themselves behave like consumer products, meaning they’re sticky and easy to use, and second, the focus of the go-to-market is the ground war as opposed to the air war, meaning they’re selling to the rank and file instead of selling to suits.

Twitter continues to dominate headlines. You were a very early employee. If you were to return to the company, what would be three things you’d love to see and why?

I was fortunate to be the first product manager at the company and started advertising products and the revenue team. When I was interviewing we were around 20 people; by the time I joined we were 25. I continue to be a heavy user of the product, and an advocate for the company and the phenomenon that’s Twitter. The company is [making strides]. Incremental product releases have accelerated. Experimentation has accelerated. [Yet] I think the time has come for Twitter to make bolder product moves. Incremental improvements and experimentation is not enough.

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New Fundings

C1X, a year-old, California City, Ca.-based online ad tech company, has raised $5.1 million in Series A funding led by University of Tokyo Edge Capital, with participation from Innovative Venture Fund (the joint fund of NEC and Sumitomo Mitsui Bank), Mobile Internet Capital, the Japanese media company Mynavi, ad agencies and angel investors. TechCrunch has more here.

Edaixi, a two-year-old, Beijing, China-based on-demand laundry service, has reportedly raised $100 million in new funding led by Baidu, with participation from earlier investors Matrix Partners and SIG China, which had led a $20 million Series A funding late last year. China Money Network has more here.

Kensho, a two-year-old, Cambridge, Ma.-based financial startup that’s combining natural language search queries, graphical user interfaces, and secure cloud computing to create analytics tools for investment professionals, has quietly raised $47.8 million in fresh funding, shows a new SEC filing. The company had previously raised $25 million across two rounds, from investors that include Goldman Sachs, Accel Partners, Breyer Capital, General Catalyst Partners, Google Ventures and New Enterprise Associates. More here.

Rebagg, a 1.5-year-old, New York-based online resell marketplace for designer handbags, has raised $4 million in seed funding from General Catalyst Partners, Metamorphic Ventures, Crosslink Capital, Founder Collective, Big Sur Ventures-Necotium and FJ Labs. TechCrunch has more here.

Suning Appliance, a 25-year-old, Nanjing, China-based brick-and-mortar retailing giant that sells electronics, has struck a deal with online retail giant Alibaba that will see the latter invest around $4.63 billion in Suning’s business for a 19.9 percent stake. Meanwhile, Suning will invest $2.28 billion to take a 1.1 percent stake in Alibaba. The two companies have agreed to more closely tie together their logistics services, too. TechCrunch has more here.

Snobswap, a two-year-old, Washington, D.C.-based luxury online marketplace focused around consignment boutiques, has reportedly raised more than $1 million in seed funding from investors including Dingman Angels, NextLevel Management, and Simplepitch Ventures. The company had previously raised $700,000 in seed funding. More here.

Super Evil Megacorp, a three-year-old, San Mateo, Ca.-based maker of competitive video games, including the online battle arena video game “Vainglory,” has raised $26 million in funding led by Index Ventures. Yuri Milner, Jim Breyer, and Korea Investment Partners, also participated in the funding. Dealbook has more here.

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Exits

The publicly traded laser tools company Coherent in Santa Clara, Ca., has acquired the assets of two companies for $9.3 million, according to a local outlet. One of those companies is Richmond, Ca.-based Tinsley Optics, a maker of specialty optics and subsystems that was part of L-3 Communications. The other is Petaluma, Ca.-based Raydiance, an 11-year-old company that makes fast-pulse lasers that are used in the production of automotive and medical devices. Raydiance had raised more than $67 million from investors, shows Crunchbase, including DFJ Growth and Samsung Ventures.

—–

People

Ifty Ahmed, the Connecticut venture capitalist accused of insider trading and defrauding his former firm, Oak Investment Partners, spent all of June and much of July in an India prison, according to new court documents uncovered by Fortune. According to its report, Ahmed appears to have fled the country in May, and was arrested and detained by India’s immigration service on May 22; he was held in prison until being released on bond on July 23. Details around why aren’t yet known.

Webvan founder Louis Borders is back with plans to develop a $99-a-year shopping club that aims to deliver groceries and other merchandise from partnering retailers on the same day they are ordered. He tells Recode about it here.

Chris Evans, a former security analyst for Oracle who joined Google a decade ago and rose through the ranks to head up security for its Google Chrome browser, is leaving the search giant to become Tesla’s head of security, he announced last week. (H/T: Fortune.)

Eric Greenberg: Once (and future?) internet billionaire. (You’ll remember him if you lived through the last bubble.)

The venture firm Social+Capital Partnership plans to invest more than $1 billion in India by 2025. More here.

Zynga has ended litigation that accused it of defrauding shareholders about its business prospects before and after going public in 2011. The company said it’s paying out a $23 million settlement that its insurers are funding.The lawsuit was led by a shareholder who accused the gaming company of hiding declining user activity, and of downplaying the impact of changes in Facebook’s platform on its games. More here.

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Jobs

AOL is looking for a senior corporate development manager. The job is in New York.

eBay is looking for a corporate development director. The job is in San Jose, Ca.

Glassdoor is looking for a senior communications person. The job is in Mill Valley, Ca.

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Data

For good or bad, the percentage of up rounds reached more than 93 percent during the second quarter, according to an analysis by the law firm Cooley of its 134 disclosable deals during the period. The industry hasn’t seen so many up rounds in more than six years, it says. You can find its full second-quarter report here.

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Essential Reads

What states are doing to woo the autonomous-care industry.

Android manufacturers are in a price war against one another. Here’s how bad it’s getting.

Facebook risks alienating two groups it needs to establish itself as a next-generation video platform. More on what’s going on here.

—–

Detours

Tesla loses more than $4,000 on every car it sells.

Science can tell if you’re a jerk by the shape of your face.

Predicting “Game of Thrones” season six story lines using shoot locations.

—–

Retail Therapy

Gazebox. Hah. Let’s see what your neighbors think about this one.

Happy Friday! We’re on the move this morning, so we present you with the economy version of StrictlyVC.:) Investor-writer Semil Shah is in charge of our columns for one last week (and has some interesting Q&As lined up toward that end). If you want to chat with him or ask him anything in the meantime, you can find him here on Twitter.

Hope you have a wonderful weekend, everyone!

—–

Top News in the A.M.

A redesign of Apple.com went live yesterday. Here’s what’s different.

Zynga yesterday beat analyst expectations for revenue and earnings, but its user numbers continued to decline.

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The High Cost of Small Checks

Semil Shah

Naively, one of the most profound lessons I had to learn in attempting to raise funds from limited partners is that most institutions prefer to write large checks. By “large,” I mean commitments to VC funds that are equal to at least or oftentimes two to three times more than what a typical decent startup may raise in its lifetime. It is all rational. The time, attention, diligence, legal burdens, and administrative headaches of doling out smaller checks to more funds reduces a larger institutions’ ability to concentrate and, frankly, creates a roster of more egos to manage over a long period of time.

An LP friend and mentor of mine summed it up perfectly to me: “Semil, I like you, but you gotta understand, my friends don’t get out of bed unless they’re writing a $25 million check.”

To those who haven’t raised funds or been around fund formation, it can all seem inefficient. For the rash of micro VC funds that have formed (mine included), we collectively confuse, vex, and overwhelm traditional institutions, including because of our higher pace of investing, heavily reduced levels of ownership, lack of toothy pro-rata rights, and a host of other issues.

Luckily for micro VCs, it doesn’t really take that much money to get going. My first fund was $1 million. It was really hard to raise. Some people have access to wealthy folks, family offices, or corporations, but it isn’t a slam dunk to raise a small fund. The second fund was considerably bigger (relative to the first), yet was still too small for institutions. The third fund will be even bigger — perhaps just at the size where the larger institutions like to build a relationship and track, much like a large VC firm who drops a $100,000 check into a company with the hopes of monitoring its progress.

As other non-traditional LPs (companies, high net-worths, and even funds) have stepped in, it’s created a boon for entrepreneurs. People with the right networks and halfway decent concepts can raise as little as $1 million in a month, even in a category where every early-stage investor knows there are four or five nearly identical competitors working on the same thing. Many of these attempts won’t go on to raise traditional venture capital, and the institutional LPs know that.

So, while there’s a high cost of writing so many small checks, we will have to wait a few years still to see just how costly it is. On the other hand, the cost of starting up may, in fact, decrease during any kind of correction as talent becomes less fragmented and major cost drivers (rent, salaries, benefits) decrease. Founders who are in demand and who are dilution-sensitive may want only specific people on their cap table, and they may want $100,000 to start, not $10 million or even $1 million.

We are a few years away from that, but this is where I see the trend headed — that being nimble enough to be invited to the cap table is what will define individual investors and firms. Those definitions can’t really be bought with money, and that’s what will make the next wave of micro VC investing so interesting — that is the high cost of small checks.

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New Fundings

Ezetap, a 3.5-year-old, Bangalore, India-based company whose lightweight card reader an be plugged into any smart device and used by a retailer to process payment, has raised $23 million in Series C funding from Horizons Ventures, Capricorn Investment Group, and earlier backers Helion Advisors, Berggruen Holdings, and The Social+Capital Partnership. (Chamath Palihapitiya of Social+Capital is also joining the company’s board as chairman — the first time he has taken on the role at a portfolio company outside the U.S., notes NextBigWhat.)

Lemonade Lab, a three-year-old, Tokyo, Japan-based company that develops sensors for athletes, has raised $5.8 million in funding led by a Foxconn subsidiary called FIH Mobile that provides manufacturing services for mobile device makers. The company has now raised $10.3 million altogether. TechCrunch has more here.

—–

IPOs

Sunrun, an eight-year-old, San Francisco-based company providing residential solar electricity and power services to homeowners, had a tough debut on the public markets this week, creating unsure results for its late-stage investors but leaving plenty of hope for its earliest backers.

—–

Exits

Tindie, a three-year-old, San Francisco-based marketplace for so-called makers to fund and sell their hardware creations, is being acquired for undisclosed terms by the maker blog Hackaday. Tindie had raised $1.7 million in seed funding from Andreessen Horowitz and Slow Ventures, among others. TechCrunch has the story here.

—–

People

Twitter CFO Anthony Noto is the only senior executive who has bought stock in the company in 2015.

—–

Essential Reads

Sprig is the latest startup to hire its contract workers.

When one app rules them all: The case of WeChat and mobile in China.

—–

Detours

Ten knives that Special Forces use around the world.

The winners and losers of the first GOP presidential debate.

Here’s every guest who showed up for Jon Stewart’s final episode yesterday of “The Daily Show.” (Sniffle.)

—–

Retail Therapy

Ejector bed. Your teenager is going to love it.

Hi, happy Thursday, everyone! Investor-writer is Semil Shah is still whipping up our columns while Connie is off playing infinity tag. To reach out to Semil, you can usually find him on Twitter.

Quick note: our upcoming event, on September 16 in San Francisco, is pretty much sold out at this point, though we can squeeze in a few more of you. Tickets are here. Giant thanks to our wonderful sponsors Bolt, GLG, and Ludlow Ventures, without which the night — at the lovely Autodesk Gallery — would not be possible. We’re very excited to see all of you next month.:)

—–

Top News in the A.M.

Booking a hotel online may soon get more expensive, hotels warned yesterday.

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Quick Chat with Homebrew’s Satya Patel

By Semil Shah

Some people are operators, some are investors. Few have so effortlessly moved from one side of the table to the other — and back — as Satya Patel, who over the course of his career has held such roles as VP of products at Twitter, partner at Battery Ventures, senior product manager at Google, and senior associate at Impact Venture Partners.

Put another way, Patel — who in 2013 cofounded the venture firm Homebrew with former Google colleague Hunter Walk, an outfit that’s already on its second fund — knows a thing or two about Silicon Valley’s undulations. We talked with him about it recently.

With companies staying private longer and fewer M&A deals being done, how much of a liquidity crisis are early-stage investors facing?

Most early-stage investors have a long-term horizon for liquidity, so the fairly recent changes in the IPO and M&A markets haven’t had a major impact on their ability to raise new funds.  Over the longer term, if the IPO and M&A trends hold, the combination of a lack of liquidity and expensive holdings is going to mean a real crisis for them.

Do LPs sense exits could be further out given the shifts we’re seeing in the private markets?

Yes, LPs definitely see that the time to achieve liquidity is longer for various structural reasons.  But the bigger concern is the increase in cost basis for most investments, particularly at the later stage.  They believe that when liquidity does come, returns will be depressed relative to historical norms for all except the very best funds.

What’s a deal at Homebrew you missed on and regret? 

The honest answer is that we’re only two and a half years old, so it’s hard to say that we regret anything that we missed or passed on yet. Those companies are nowhere near liquidity, even though in a ton of cases they have gone on to raise huge amounts of capital at high valuations. That said, there was an investment in the commercial real estate software market that we lost six months after starting Homebrew that we consider a likely major loss. The company chose to work with investors that had been around much longer, with extensive track records in relevant markets.  We would have made the same decision at that time as the founders, but we still consider it one of the ones that got away. In general, we have conviction about our strategy and believe that in many cases, we’ve passed up short-term write-ups to avoid long term pain.

There’s been a growing chorus of people saying  that seed is the new Series A. Do you buy that? 

I think the labels are meaningless.  At which “stage” a fund invests and with what dollar size investment is largely a function of fund size.  Our goal at Homebrew is to be first institutional capital supporting a company with an investment between $200,000 and $1 million.  Often that is pre-product, and other times that’s with a beta or more developed product in the market.  Because there are so many seed-stage companies, the bar for raising the next round of financing is that much higher; even more is required to stand out from the crowd. So maybe in the past, you only needed to build the product with seed dollars.  Now, you have to build the product and establish product/market fit with seed capital. Does that mean seed is the new Series A?  It doesn’t matter what you call it. It’s the new normal.

You’ve been in the Valley for a long time. What’s your sense of the health of the overall ecosystem right now?

The ecosystem seems to be as strong as it’s ever been.  There are more startups, more sources of capital, more information resources, more places — accelerators, labs, schools — to learn and more job opportunities than I can remember.  The countervailing forces of limited liquidity and frothy valuations may slow down the ecosystem’s momentum.  But there doesn’t seem to be anything that will stop the ecosystem from continuing to grow in all of those areas if you take a long-term view.

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New Fundings

AddtoApp, a year-old, L.A.-based programmatic mediation platform for in-app advertising, has raised $6 million in new VC funding from Run Capital Investment Fund.

Aihuishou, a four-year-old, Shanghai, China-based used electronics trading and recycling platform,  has raised $60 million in Series C funding led by Tiantu Capital, with participation from JD.com and earlier backers Morningside Ventures and the International Finance Corporation. The company had reportedly raised at least $12 million previously.

Bastille, a year-old, Atlanta, Ga.-based cybersecurity company designed to detect and mitigate threats coming through connected devices, has raised $9 million in Series A funding led by Bessemer Venture Partners, with participation from cybersecurity entrepreneur Tom Noonan and Bastille founder and CEO Chris Rouland. The company has now raised $11.5 million altogether.

CashStar, an eight-year-old, Portland, Me.-based provider of prepaid mobile and web commerce solutions for retailers and restaurants, has raised $15 million in Series D funding led by FTV Capital, with participation from Mosaik Partners and return backers, including Passport Capital, Intel Capital and North Hill Ventures. The company has now raised a total of $50 million.

Enjoy, a year-old, San Francisco-based company that sells high-end consumer electronics, as well as offers delivery and in-home set-up services, has raised $50 million in Series B funding led by Highland Capital Partners, with participation from earlier backers Kleiner Perkins Caufield & Byers and Oak Investment Partners. The round brings total funding for the company, founded by former Apple retail chief Ron Johnson, to $80 million.

Fastly, a four-year-old, San Francisco-based content delivery network that focuses on helping companies deliver dynamic content to their users faster, has raised $75 million in Series D funding led by ICONIQ Capital. Existing investors Amplify Partners, August Capital, Battery Ventures, IDG Ventures and O’Reilly AlphaTech Ventures also participated in the financing, which brings the company’s total funding to $130 million.

Jibo, a three-year-old, Cambridge, Ma.-based consumer electronics company that has developed a “family friendly robot” called Jibo, has raised $11 million in funding from Asia-based investors, including Acer, Dentsu Ventures, China’sNetPosa and operators KDDI (Japan) and LG Uplus (Korea). The capital follows a crowdfunding campaign that saw the company raise $3.7 million (it was targeting $100,000), and a $25.3 million round led by RRE Ventures in January of this year. TechCrunch has more here.

LifeBond, an eight-year-old Caesaria, Israel-based based company that makes surgical sealants, has raised $27 million in Series D funding from Adams Street Partners, Sino Biopharmaceutical and earlier investors Pitango Venture Capital, Glenrock Israel and Zitelman Group.

Payable, a two-year-old, Sunnyvale, Ca.-based company that lets contractors measure and bill their hours and help businesses manage their invoices in a single dashboard, has just raised $2.1 million from Freestyle Capital, Redpoint Ventures and SherpaVentures, Lerer Hippeau Ventures,Rothenberg Ventures, Haystack, Moment Ventures and other angel investors. TechCrunch has more here.

Practo Technologies, a seven-year-old, Bangalore-based maker of online practice management software for doctors, has raised $90 million in new funding led by the Chinese internet giant Tencent, with participation from Google Capital, investor Yuri Milner, the Belgium-based investment firm Sofina, Altimeter Capital Management, and earlier backers Sequoia Capital and Matrix Partners. The company has now raised about $125 million altogether.

SavingGlobal, a 1.5-year-old, Berlin, Germany-based retail deposit brokerage platform, has raised €20 million ($21.8 million) in Series B funding led by Ribbit Capital and Index Ventures. Investors Yuri Milner and Tom Stafford also participated in the round, which brings the company’s total funding to $32.7 million. TechCrunch has more here.

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New Funds

Arboretum Ventures, a 13-year-old, Ann Abor, Mi.-based venture firm, is looking to raise up to $215 million for its newest fund, according to an SEC filing. If successful, it will become the largest venture fund ever raised in Michigan.  Crain’s Detroit Business has more here.

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Exits

Affirm, the new lending startup from PayPal cofounder Max Levchin, has acquired LendLayer, a year-old, Mountain View, Ca.-based startup that provides lending for accelerated learning programs like Hackbright Academy. Terms of the deal weren’t disclosed, but TechCrunch describes the deal as a “talent transaction.” More here.

Adidas Group, the sports company, has acquired the six-year-old, Austria-based fitness app maker Runtastic for €220 million ($240 million). The largest shareholder in Runtastic was German media giant Axel Springer, via its investment subsidiary Axel Springer Digital Ventures, which owned 50.1 percent of the company. TechCrunch has more here.

SurveyMonkey, a Palo Alto, Calif.-based online survey software company, earlier this week acquired TechValidate, an eight-year-old, Emeryville, Ca..-based provider of marketing content automation software. No financial terms were disclosed. SurveyMonkey has raised more than $1 billion from investors; TechValidate doesn’t appear to have raised outside funding. Fortune has more here.

WeWork, the well-funded tech and real estate company, has acquired seven-year-old, New York-based Case, a building information modeling and consultancy firm  that advises landlords, architects, contractors and engineers on how to efficiently design and manage buildings. Terms of the deal were not disclosed. The Real Deal has more here.

—–

People

The organic food delivery startup Good Eggs is scaling back on things pretty dramatically. In a blog post yesterday, cofounder and CEO Rob Spiro said the company is shutting down its operations in Los Angeles, New York City and New Orleans and focusing alone on its remaining location, San Francisco, for now. The company is also shedding more than half its workforce, laying off nearly 140 employees and continuing to operate with “100+,” in his words. Good Eggs has raised $52 million in its four-year history, shows Crunchbase. Its investors include Baseline Ventures, Collaborative Fund, Correlation Ventures, Harrison Metal, Index Ventures, Sequoia Capital and The Westly Group. TechCrunch has more here.

—–

Essential Reads

Why Google‘s antitrust deal with the EU fell apart.

Reddit has shut down another group of offensive sections on its website as part of a revision to last month’s policy change. Bloomberg has more here.

Dating app Tinder is getting into the speed networking business. TechCrunch has more here.

—–

Detours

Jon Stewart’s greatest takedowns: The internet’s definitive list.

The 12 best tech TV commercials of all time.

The Pierre.

—–

Retail Therapy

Escape Traveler. It takes the RV to a new level completely.

Hi, everyone, hope your Wednesday is off to a promising start!

If you have questions or comments about today’s newsletter, you can typically find investor-writer Semil Shah (who is nicely writing StrictlyVC’s columns for Connie while she takes some time offline) right here on Twitter.

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Top News in the A.M.

Apple to the media: “We have not discussed nor do we have any plans to launch an MVNO.” More here.

Etsy reported another quarterly loss yesterday; its shares are now trading down roughly 46 percent since its IPO.

Yesterday, Netflix introduced an unlimited leave policy for new moms and dads that allows them to take off as much time as they want during the first year after a child’s birth or adoption. (“The talent is growing up,” notes TechCrunch.)

—–

Quick Chat with DCM’s Jeff Lee

By Semil Shah

Jeff Lee joined the venture firm DCM as a principal last year after running his own business for the previous four years. We caught up with him recently to see how things are going, and what insights into DCM — a 19-year-old firm that invests in the U.S., China, and Japan — he might share.

Most people know Yik Yak but don’t know DCM was an early lead investor. Does DCM like being under the radar in this sense?

At DCM we are very focused on our entrepreneurs. We like our investments to speak for themselves. That said, we also do a lot of deals in China and Japan, where I think we actually are more visible than in the U.S.

What’s happening right now in China that most people in the Valley don’t have a good read on?

Right now there is a huge amount of capital not only in China, but also in Japan, and it’s looking internationally for new opportunities. The major technology companies, “BAT” (Baidu, Alibaba, and Tencent) in China, as well as Rakuten, Softbank, and Recruit Holdings in Japan are actively looking to invest in U.S.-based companies, as well as to acquire startups. Also given that much of the mobile innovation really got started in Asia, startups should increasingly look to Asia as the emerging source of knowledge, capital, and potentially also exits.

How competitive is it for a Series A investor to win a good deal right now? You’re relatively new to DCM — how’s it been in that regard?

There is a ton of capital focused on Silicon Valley right now that has driven valuations to all-time-high levels, as well as increased competition for great deals. I prefer to get to know an entrepreneur ahead of a financing. It not only helps you lean forward on an opportunity, but ultimately helps to build [the kind of] trusted relationship you need to build a great business together.

You spent a good deal of time building your previous company in LA. What are some of the biggest changes you’ve noticed since moving back to Silicon Valley?

Well I did my undergrad at Stanford so in a lot of ways it feels like I’ve come home. I think the biggest difference between L.A. and the Valley is the pace and the feel of the community. Things happen much faster in the Valley because of the competition and size and fast feedback cycles, whereas L.A. has a tight entrepreneurial community because it tends to sit in the shadows of the entertainment industry, as well as Silicon Valley. Also because there are many other core industries in L.A. like entertainment, real estate, and autos and the population is so diverse, the types of entrepreneurs you find are also much more creative. The Valley is like the older, more mature brother of L.A.

If you could share and broadcast one niche area you’re dying to invest in, what would it be and why?

Workflow-enabled marketplaces. Complex tasks like remodeling your home have historically been difficult because they require the coordination of lots of different resources, and there’s frequently not visibility to figure out the right the small business vendors fit the job. These next generation marketplaces not only allow the user to identify the best vendors through reputation built within the system, but also coordinate the delivery of service through the SaaS-like workflow they provide. One thing I really love about these models is they’re network effect businesses that enable underserved markets, much like my prior company Cost Cooperative, which was a group- buying marketplace for small businesses. Addressing large, underserved needs with network effects are two core pieces in building an industry-defining, transformative business.
—–

New Fundings

Amplitude, a three-year-old mobile analytics platform designed to give developers better insights into user behavior, has raised $9 million in Series A funding led by Benchmark, with participation from Data Collective, Merus Capital, Quest Venture Partners, and entrepreneurs Dave Morin and Charlie Cheever, among other individuals. The company has now raised at least $11 million altogether. TechCrunch has more here.

BankFacil, a three-year-old, Sao Paulo, Brazil-based online loan origination platform, has raised $3 million in funding from Frontier Investments Group and Redpoint eventures. VentureWire has more here.

Bright, a year-old, San Francisco-based solar panel installation and distribution startup, has raised $4 million in seed money from a number of firms and angel investors, including First Round Capital, Felicis Ventures, Max Levchin, Patrick Collison and several Y Combinator partners. TechCrunch has more here.

Doormint, a year-old, Mumbai, India-based online marketplace for hiring workers for particular household tasks, has raised $3 million in Series A funding led by Helion Venture Partners, with participation from Kalaari Capital. It had received angel funding from Powai Lake Ventures in May. DealCurry has more here.

Leanplum, a three-year-old, San Francisco-based service that helps developers and marketers engage with mobile users through personalized messages, dynamic user-interface optimization and A/B testing services, has raised $11.6 million in Series B funding led by Kleiner Perkins Caufield & Byers, with participation from earlier backer Shasta Ventures. The company has now raised a total of $17.2 million. TechCrunch has more here.

Letstransport, an eight-month-old, Bangalore, India-based last-mile delivery company, has raised $1.3 million led by Rebright Partners, with participation from individual investors Ankush Nijhawan, Gaurav Bhatnagar, and Manish Dhingraalso. TechCrunch has more here.

Line, a 15-year-old, Tokyo, Japan-based messaging company that’s owned by the Korean internet giant Naver, has partnered with Korean game development firm LongTu to create Hong Kong-based Lantu Games, a $20 million joint venture that will begin operations this month. TechCrunch has more here.

Mark43, a three-year-old, New York-based company whose law enforcement software makes it easier for police to collect, manage, analyze and share information, has raised $10.8 million in Series A funding led by Spark Capital and General Catalyst Partners, with participation from Lowercase Capital, Govtech Fund, Allen & Co., Innovation Endeavors, and individual investors, including actress Sophia Bush and retired General David Petraeus. VentureWire has more here.

Tintri, a seven-year-old, Mountain View, Ca.-based hybrid storage startup, has raised $125 million in Series F funding led by Silver Lake Kraftwerk, with participation from Insight Venture Partners, Lightspeed Venture Partners,Menlo Ventures and New Enterprise Associates. ZDNet has more here.

Workfront, a 14-year-old, Lehi, Ut.-based maker of work management software (it was previously known as AtTask), has raised $33 million in Series E funding led by the growth equity firm JMI Equity, which also previously led the company’s $38 million Series D round last year. Greenspring Global Partners and Atlas Peak also participated in the round, which brings the company’s total funding to $95 million. TechCrunch has more here.

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IPOs

Global Blood Therapeutics, a three-year-old, San Francisco-based company whose early-stage drug is designed to treat the serious blood condition sickle cell disease and that filed to go public last month, has revealed plans to sell six million shares at $16 to $18 per share. At the midpoint of that range, the offering would bring in $102 million. Currently, the company’s two biggest shareholders are Third Rock Ventures, which owns a 63 percent stake, and Fidelity, which owns 13.2 percent.

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Exits

Publicly traded Tableau Software is acquiring another company for the first time, bringing aboard Infoactive, a three-year-old, Montreal-based startup that turns data into infographics. GeekWire has more here.

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People

San Francisco Mayor Ed Lee — who has benefited from the public support of Silicon Valley bigs like investor Ron Conway and Yahoo CEO Marissa Mayer — has been implicated in bribery and money laundering schemes, according to new filings related to the Richard “Shrimp Boy” Chow. Chow was the head of a Chinese criminal enterprise and arrested by the FBI last year. More here.

Anybody with a great startup idea in America should have a chance to explore it, suggested President Barack Obama at the first-ever White House Demo Day held yesterday in Washington D.C. GeekWire has more on the event here.

PayPal has a new CFO: John Rainey, who joins the company from United Continental Holdings. More here.

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Jobs

Rough Draft Ventures, the General Catalyst-supported, student-run investment team, is looking for a head of platform. The job is in Cambridge, Ma.

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Essential Reads

Twitter may be a takeover target — but likely not for Google, says Recode. More here.

China plans to set up “network security offices” staffed by police inside major Internet companies, a move to strengthen the government’s grip on the world’s largest population of Web users.

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Detours

The world’s highest-paid actors.

The debate over “illegal immigrant.”

A jeweler has created a line of Apple Watches that only Russian President Vladimir Putin could love.

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Detours

An incredible e-bike that costs an incredible $25,000 (to start).

Happy Tuesday, dear readers! Yesterday’s newsletter wound up in many of your spam boxes for some reason. If you wanted to catch yesterday’s issue, including our interview with Twitter persona Startup Jackson, it’s here. In the meantime, investor-writer Semil Shah is in charge of our columns for another week or so while Connie brushes up on her skateboarding. If you have questions or comments, you can find him right here on Twitter.

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Top News in the A.M.

Apple is reportedly in talks to launch its own virtual network service in the U.S. and Europe.

Microsoft‘s offshore profits have surged past the $100 billion mark.

Samsung Electronics said yesterday that it will create a 100 billion won ($85.8 million) fund to compensate cancer-stricken workers and their families, and to help prevent more of the same at its chip and display factories.

Twitter‘s shares dropped yesterday to their lowest level since the company’s November 2013 IPO, sparking takeover talk.

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Notation Capital on Life as a Pre-Seed, East Coast Fund

By Semil Shah

In February, Nicholas Chirls and Alex Lines, who previously helped develop companies at the startup studio Betaworks, closed their first fund with just $8 million dollars. Their Brooklyn-based firm, Notation Capital, calls itself a “pre-seed” investor. We caught up with Chirls recently to learn more, and see how things are going.

How do you manage to run Notation Capital full-time despite it being a small fund  and therefore earning lower fees?

In order to pay ourselves modest salaries, we operate the fund using a budget rather than the typical 2 percent yearly management fee. Fees remain effectively equivalent to 2/20 funds over time, but the budget allows Alex and myself to front-load some of the management fees. It works well for very small micro-funds and is in many ways more transparent than traditional 2/20 funds because management fees tend to obscure other fund expenses like legal and fund admin, among others, [that limited partners], especially individuals, often don’t realize they’re paying other fees in addition to the management fee. Alex and I run Notation Capital extremely lean; it’s just us, we have a small office in Brooklyn, and although I previously would have scoffed at VCs comparing their new funds to startups, there are no doubt some similarities.

Do you have plans in place to follow-on in your portfolio as companies raise more money?

So this is a really tough question for funds of our size that take a relatively concentrated approach to portfolio construction. (For us, that means approximately 30 to 40 companies in the fund.)

There are a couple of ways to approach this question. The first approach doesn’t save any for follow-on rounds out of the core fund, and instead focuses on writing relatively larger checks in order to obtain higher initial ownership. As companies raise additional financing, especially those that break out, there may be opportunities for the fund to structure pro-rata SPVs either with [our] existing LP base or on platforms like AngelList. It’s important to note that for non-institutional funds — Notation is a mix of institutions and non-institutions — that traditionally have a more complex LP base, structuring these SPVs can be super complicated and potentially riddled with conflict, so this can be a tough strategy in practice to execute.

The alternative, and slightly more conservative approach, is to write relatively smaller initial checks earning less initial ownership with the intention of saving meaningful pro-rata to maintain ownership through the seed, and potentially Series A out of the core fund.  We’re still only 6 months into operating our first fund, so in many ways we’re still refining our strategy, but initially we’re leaning towards higher initial ownership with less reserved for pro-rata.

Give us a sense for what valuation prices are like for pre-seed, seed, and seed extension + A rounds in New York and the East Coast more broadly.

Pre-seed valuations are around $1 million to $3.5 million. Seed valuations are between $4 million and $8 million. And A round valuations are between $10 million and $25 million-plus.

Have you had founders in Silicon Valley approach you for pre-seed funding yet?

We have, mainly because we’ve worked with quite a few founders in Silicon Valley at previous firms and companies. The concept of pre-seed, which is really just what we considered seed a few years ago, is quickly becoming a regular part of startup vocabulary. So positioning ourselves as one of the newer pre-seed funds in NYC has helped to tell our story. At the moment, we’re focused on building a community of founders specifically here in NYC, but that will change as our strategy evolves and our firm grows.

Is the plan to keep Notation small, or to eventually manage more funds?

This is the first of a series of funds for Notation Capital. That doesn’t mean we’ll raise significantly larger funds and move up the stack. Our bread and butter has and always will be working with highly technical founders at the infancy of an idea. What that means is that future funds will be larger in order to give us the flexibility to make meaningful follow-on investments out of the core fund and maintain ownership targets as the companies we work with mature. Our hope is that if we do it right, we’ll be working to build Notation Capital for years and decades to come.

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New Fundings

Beat the Q, a four-year-old, New South Wales, Australia-based pre-ordering and payments company, has raised $5 million in Australian dollars ($3.7 million) from the regional venture firm Reinventure, with participation from Exto Partners. More here.

Duetto, a 3.5-year-old, San Francisco-based company whose SaaS applications help hotels forecast demand, set prices and manage distribution, has raised $30 million in funding led by Icon Ventures. Other participants in the round include earlier backers, including Accel Partners, Battery Ventures, Altimeter Capital, and individual investors like Salesforce founder and CEO Marc Benioff.

FEM, a three-year-old, L.A.-based personalized video engagement platform, has raised $3 million in seed funding from Javelin Venture Partners, MESA Ventures and The Walt Disney Company via its Disney Accelerator. Venture Capital Dispatch has more here.

Mandae, a year-old, Sao Paolo, Brazil-based shipping service (it resembles the U.S. shipping service Shyp), has raised $1.5 million in Series A funding from Monashees Capital, Valor Capital Group, and former DHL CEO Hans Hickler.

Panorama Education, a 2.5-year-old, Boston-based startup that surveys students, parents and teachers to collect actionable data, has raised $12 million in new funding led by Spark Capital and Owl Ventures, with participation from earlier backers, including Y Combinator, Google Ventures, and Mark Zuckerberg and Priscilla Chan’s Startup:Education. TechCrunch has more here.

Pickingo, a 10-month-old, Gurgaon, India-based on-demand delivery service, has raised $1.3 million in seed funding led by Rehan Yar Khan of Orios Venture Partners, with participation from Toppr.com cofounder Zishaan Hayath, both early investors in Ola Cabs. YourStory has more here.

Riffsy, a 1.5-year-old, San Francisco-based company whose GIF keyboard enables users to share and discover animated GIFs and videos, has raised $10 million in Series A funding led by Menlo Ventures, with participation from Cowboy Ventures, Signia Venture Partners and earlier backer Redpoint Ventures. The company has now raised $13.5 million altogether. TechCrunch has more here.

Seriously, a two-year-old, Finland-based mobile games maker, has raised $18 million in Series A funding led by Northzone, with participation from Korea Investment Partners and earlier investors Upfront Ventures, Sunstone Capital and Daher Capital. The company has now raised $28 million altogether. Venture Capital Dispatch has more here.

Tujia, a four-year-old, Beijing, China-based company that has been likened to China’s Airbnb, has raised $300 million at valuation north of $1 billion led byAll-Stars Investment, an investment fund run by former Morgan Stanley analyst Richard Ji. Other participants in the round included the serviced-apartment manager The Ascott, and earlier investors, including Ctrip.com. The WSJ has much more here.

Zeotap, a year-old, Berlin, Germany-based data platform that connects telecom operators with the app and advertising ecosystem, has raised $6.4 million in Series A funding from Capnamic Ventures, Iris Capital, numerous angel investors and previous backers. TechCrunch has more here.

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Exits

Advance/Newhouse is spending $500 million to acquire 1010data, a 15-year-old, New York-based company that provides cloud-based big data analytics for retail, manufacturing, telecom and financial services companies. The company had raised at least one, $35 million, round of funding from from Norwest Venture Partners, which reportedly sold its stake. Venture Capital Dispatch has the story here.

Microsoft has spent an undisclosed amount of money to acquire Incent Games, a three-year-old, Austin, Tex-based company behind a  “sales gamification” platform called FantasySalesTeam. FantasySalesTeam had raised $1.4 million from ATX Seed Ventures, Central Texas Angel Network, and Marvel Venture Partners, according to CrunchBase. TechCrunch has more here.

The venture-backed digital photo startup VSCO has acquired Cambridge, Ma.-based stealth machine learning startup Moving Sciences for an undisclosed sum characterized by VentureWire as “small” and involving just one employee (presumably founder Yuanzhen Li, who has a PhD from M.I.T.). More here.

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People

Michael Evans, a longtime executive at Goldman Sachs who left at the end of 2013, has joined Alibaba as its new president to lead its international business. Evans spent the last decade running Goldman’s Asian operations. TechCrunch has more here.

Facebook cofounder Dustin Moskovitz and his wife, Cari Tuna, are donating $25 million to GiveDirectly, a new nonprofit that gives extremely poor people cash instead of traditional aid, including in Kenya and Uganda. Forbes has more here.

The insane life of serial entrepreneur Sean Parker (a Business Insider special).

Tidal, the streaming music service owned by entertainment mogul Jay Z, is facing a wave of staff departures, reports Music Week. Zena Burns, for example, who had joined the company as its senior VP of label and artist relations, appears to have left in June after just two months on the job. More here.

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Jobs

Cue Ball Capital, the venture firm, is looking to hire two associates. Interested parties can send a resume and cover letter to thuque [at] cueball [dot] com. The jobs are in Boston.

StyleSeat, which helps independent beauty professionals manage their businesses (it just raised $25 million in Series B funding), is looking to hire a business development associate. The job is in San Francisco.

Versant Ventures, the healthcare investment firm, is looking for an investor relations and marketing manager. The job is in San Francisco.

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Data

China’s stock markets: Nearly 25 years of wild swings.

European tech companies raised €3.47 billion in venture capital in the second quarter: Where it went and what it means.

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Essential Reads

Uber drivers rallied by the company to testify in a lawsuit that they wanted to stay contractors have since changed their minds, submitting new court declarations saying they were misled about the difference between contractors and employees. (Maybe it’s no surprise that another “on-demand” startup, Eden, just opted to turn its contract workers into full-time employees. More here.)

Facebook is getting in on the (live event) action. Wired has more here.

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Detours

Surfing — on a dirt bike.

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Retail Therapy

Turntable kitchen timer.