• StrictlyVC: May 26, 2015

    Hi, good morning, everyone, and welcome back!

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    Top News in the A.M.

    It’s official. Charter Communications has agreed to acquire Time Warner Cable in a deal valued at $78.7 billion.

    This is getting interesting: last Thursday, the Florida Department of Economic Opportunity decided that former Uber driver Darrin McGillis was an employee of the company, not a contractor as the company contends, and is thus eligible for unemployment insurance. Buzzfeed has the story here.

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    Jeremy Liew on Snapchat, Anonymous Apps, and the Fallibility of Intuition

    Last week, we published several interviews from our most recent event in San Francisco. Today we’re running the last of those interviews, with venture capitalist Jeremy Liew, because it’s also worth sharing.

    Liew joined Lightspeed Venture Partners in 2006 from AOL, where he’d worked in corporate development, and as many readers will know, his star has risen quickly in the last nine years, thanks to investments like Snapchat, Bonobos, and The Honest Company. (Snapchat is reportedly valued at upwards of $20 billion and Liew wrote its first check, for $500,000. Meanwhile, both Bonobos and The Honest Company are expected to go public in the not-too-distant future.)

    Liew — who primarily focuses on social media, commerce, gaming and financial services — doesn’t seem to be taking anything for granted. Parts of our chat, edited for length, follow.

    What’s your day like? Are there certain things you pore over every morning like App Annie?

    Probably three-ish years ago, taking more of a quantitative approach and looking at data sources was a more of an advantage; you could spot things before other people did. I still think that it’s good to see what everybody’s seeing, and we want to do that, but oftentimes, there’s an awful lot of interesting stuff that’s not as well-known, and you have to go looking for that. Bitcoin is a good example. Now there’s a lot of coverage about it, but two or three years ago, that wasn’t the case, and you could meet every interesting Bitcoin company in the world, which then was 15 or 20 companies.

    So you develop a thematic approach, then dig in?

    First, just being able to observe the present without judgment [is important]. It’s easy to rush to judgment based on your intuition, but you have to recognize that your intuition can be pretty fallible before you write something off.

    You also have to have a point of view that’s differentiated. Some people did around [virtual reality]; we didn’t. we missed that whole thing. But when you pick a sector early, you really can be as well-versed in that sector as anybody else.

    You think you’ve already missed the virtual-reality wave? 

    There are some sectors where you really have to spend time to develop a point of view. I haven’t [when it comes to VR] not because I don’t think it’s interesting but because I’ve been focused on other stuff. And I think VC is becoming more of a specialist business. If you don’t know enough about a category, entrepreneurs probably figure that out pretty quickly.

    You’ve said that you think L.A. is more in touch with what the rest of the country wants than Silicon Valley. How much time do you spend there?

    I have one board seat in the Bay Area, five in L.A and five in New York. It’s not that I don’t want to invest in Bay Area, but [I no longer believe there’s a] path that starts [here] with the digerati and that spreads to everyone else as they slowly grow to understand what we’ve always known. Instead, it’s actually young women who are the carriers of cultural viruses; it’s young women who are early adopters who will evangelize technologies and help spread them. And you ask yourself: who understands what young women in middle America will be doing, people in Silicon Valley or people in L.A. and New York?

    One of your biggest L.A.-based bets is on Snapchat. For those who don’t know, how did that deal come together?

    It was in 2012. It’s a lucky thing. One of my partners has a daughter who, at the time, was in high school. He’s an engaged dad and he noticed she was using this new app all the time, and [asked about it]. She said everybody in school has three apps: Instagram, Angry Birds, and Snapchat. (Remember, it was 2012, so people were still playing Angry Birds.)

    He mentioned it to me since I focus on consumer stuff, so I downloaded the app, and I really didn’t understand what the big deal was [but figured if a] subset of people are using something intensively, it’s worth understanding why. So I saw [an email address] on Snapchat’s site and I emailed it and never heard back. I [turned to] LinkedIn and no one was listed as an employee at Snapchat. [Eventually] I turned to a WhoIs [domain] lookup [and it listed] Evan Spiegel, who was a sophomore at Stanford, so I emailed him through LinkedIn and never heard back. Then I started randomly emailing [different possible gmail addresses for him] and didn’t hear back. I was about to give up but tried one last thing. Since Evan was a Stanford student and I was a Stanford grad from business school, we were in the same Facebook [group], so I direct messaged him. And I heard back from him one second later, and he said, “Oh, I’d love to talk with you.” [Laughs.]

    He wandered over the next day, cracked open his Mixpanel [mobile analytics] account and I was shocked by the engagement, retention and growth . . . It was growing so fast that he said, “We can’t pay our server bills,” and we said, “We can help you with that!”

    Reports say Snapchat is now worth $10 billion to $20 billion. What do you think it’s worth right now?

    I agree that’s what reports say. [Laughs.]

    Have you taken some of your money off the table?

    For more of our interview with Liew, continue reading here.

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    New Fundings

    Bluebee, a four-year-old, Delft, the Netherlands-based DNA analytics startup, has raised €1.75m ($1.9 million) from the Belgian investment firm Buysse & Partners and Delft University of Technology, from which the company spun off. More here.

    Boost Academy, a three-year-old, San Diego, Ca.-based developer of an interactive math tutoring platform for the iPad, raised $600,000 in seed funding from individual investors, including serial entrepreneur Tom Ladt. More here.

    Clutch, a three-year-old, Ambler, Pa.-based platform that helps consumer-focused marketers identify, understand and engage their customers, has raised $5 million in Series B funding led by Safeguard Scientifics. The company has now raised $14.4 million altogether. More here.

    FruitDay, a nine-year-old, Shanghai, China-based company that sells fresh produce across China, has raised $70 million in Series C funding led by e-commerce giant JD.com, with participation from earlier investors Susquehanna International Group and ClearVue. TechCrunch has more here.

    Funding Options, a nearly four-year-old, Manchester, U.K.-based online broker that matches small businesses with finance providers, has £2m ($3 million) in funding led by GLI Finance. More here.

    GoFactory, a four-year-old, San Francisco-based company that specializes in helping industrial-scale businesses connect to the Internet of Things, has raised $2 million in seed funding led by Visionnaire Ventures, with participation from executives in the industrial and manufacturing sectors including Reuben Brothers, David Clark, Jonathan McQueen, Swordfish Investments and Thomas Kunz.

    Granify, a four-year-old, Edmonton, Alberta, Canada-based revenue optimization platform that applies machine learning to predict in real time which shoppers aren’t going to make a purchase at an online site and provide them with additional contextual stimuli to overcome their objections, has raised $7 million in Series A funding led by Peter Thiel’s Valar Ventures, with participation from earlier backers iNovia Capital, Social Starts and angel investors. More here.

    HelloTech, an eight-month-old, L.A.-based on-demand in-home tech support and technology sales service, has raised $2 million in seed funding from investors, including Collaborative Fund, Baroda Ventures, Greycroft Partners, and Silicon Valley Bank. The company has now raised $4.5 million altogether, including from Accel Partners, Upfront Ventures, Crosscut Ventures, and Amplify.LA. StrictlyVC talked with cofounder and CEO Richard Wolpert about HelloTech, a play on “tech support for your parents,” earlier this year.

    Hotels.ng, a three-year-old, Lagos, Nigeria-based company that claims to be the country’s largest hotel booking site in Nigeria, has raised $1.2 million to expand across Africa. Investors include EchoVC Pan-Africa Fund and Omidyar Network. TechCrunch has more here.

    Iprice group, a year-old, Kuala Lumpur, Malaysia-based online shopping community company featuring local and international brands, has raised $550,000 in funding from Asia Venture Group. More here.

    Iyzico, a three-year-old Istanbul, Turkey- based secure payment processing and management system for online businesses and enterprises, has raised $6.2 million in Series B funding led by International Finance Corporation (the World Bank’s investing arm), the Istanbul-based venture capital firm 212, New York-based investor Endeavor Catalyst, and Speedinvest from Austria. The company has now raised $9.4 million altogether.

    Kobojo, a seven-year-old, Paris, France-based company that makes online role-playing games that are designed for touch devices, has raised $7 million in funding led by Oxford Capital, with participation from the Scottish Investment Bank and Endeavour Vision. The company has raised at least $14.7 million to date, shows Crunchbase.

    Magnetic, a seven-year-old, New York City-based digital advertising technology company, has raised $25 million in funding led by Edison Partners, with participation from CRV, ORIX Ventures, the Honeywell pension, Jonathan Kraft, Roger Ehrenberg, and others. In related news, the company has merged with MyBuys, a San Mateo, Ca.-based multi-channel marketing and personalization platform. MediaPost has more here.

    Mitoo, a 1.5-year-old, San Francisco, Ca.-based sports league platform, has raised $1.5 million in seed funding from Slow Ventures, Lift Partners, Kima Ventures, and 500 Startups, among others. VentureBeat has more here.

    Mode Media, an 11-year-old, Brisbane, Ca.-based startup previously known as Glam Media, has raised $30 million led by earlier investor Hubert Burda Media, a German media company. The company, which began life as a women-focused online ad network and is today a hub for video creators, has raised $244.6 million altogether, shows Crunchbase. Earlier backers include GLG Partners, DFJ, Accel Partners, Information Capital, and Walden Venture Capital.

    Munchery, a four-year-old, San Francisco-based service that delivers quick, microwavable meals to users, has raised $85 million in new funding that values the company at $300 million. Earlier backers SherpaVentures and Menlo Ventures led the deal, with participation from NorthGate Capital, 137 Ventures, Mousse Partners, e.ventures, and Greycroft Partners. The company has now raised $117.2 million altogether, says VentureBeat.

    PayItSimple, a six-year-old, New York-based company whose payment technology is used by merchants to offer consumers the ability to make purchases using interest-free installments, has raised $10 million in debt funding from Simpel Management in New York. More here.

    Rubrik, a year-old, Palo Alto, Ca.-based company that offers live data access for recovery and application development by fusing enterprise data management with web-scale IT, has raised $41 million in Series B funding led by Greylock Partners, with participation from Lightspeed Venture Partners and existing angel investors. The company has now raised more than $51 million altogether it says. More here.

    Spring, a two-year-old, New York-based shopping app, has raised an undisclosed amount of funding from the popular messaging app Snapchat, according to Recode’s sources. Spring announced a $25 million funding in April that did not include Snapchat (but did include Thrive Capital, Google Ventures, Groupe Arnault/LVMH, Yuri Milner, and BoxGroup.) As notes Recode, an SEC filing suggests that Spring parent company Jello Labs is still open to raising an additional $5.7 million for a total of $30.7 million.

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    New Funds

    Globespan Capital Partners, the 12-year-old, Boston-based venture firm, is looking to raise $75 million for its sixth fund, shows a new SEC filing. The firm closed its fifth fund with $380 million in 2007. Globespan was launched when members of the senior investment team at JAFCO Ventures, the venture of Tokyo-based JAFCO, decided to spin out on their own. Its bets include Roku, Redfin, and Credit Sesame, among others.

    The Social+Capital Partnership, the four-year-old, Palo Alto, Ca.-based venture firm founded by former Facebook VP Chamath Palihapitiya, has raised $600 million for its third fund, reports a Fortune profile on Palihapitiya. According to earlier SEC documents, the firm was targeting $450 million fund. The firm’s two previous funds were $275 million and $325 million in size, respectively.

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    IPOs

    Alarm.com has registered plans to raise up to $75 million in an IPO. The company is predominately owned by Technology Crossover Ventures, which hold a 42.9 percent stake, and ABS Capital Partners, which owns 41.6 percent of the company. Fortune has more here.
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    Exits

    Travel giant Expedia has sold its majority stake in the China-focused travel agency eLong for $671 million. TechCrunch has more here.

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    People

    Apple‘s Jony Ive has a new job.

    Longitude Capital, an investment firm that focuses on venture growth investments in drug development and medical technology, has promoted Sandip Agarwala to managing director. Agarwala joined the firm in 2013 and focuses on structured investments in both biotechnology and medical device companies.

    BlackBerry said Friday that it’s laying off an undisclosed number of employees in its device business including those focused on development of smartphone software and applications. The WSJ has more here.

    Numerous tech entrepreneurs and investors have collectively donated $5 million to help house homeless veterans in San Francisco’s Mission Bay neighborhood, where a 50-unit building is being built for a total expense of $48 million. The money is expected to advance construction by one year. (It has yet to begin.) Donors include Peter Thiel, Sean Parker, Andrew Mason, Drew Houston, Alfred and Rebecca Lin, Marc Benioff and Ron Conway. More here.

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    Jobs

    LinkedIn is looking to add an associate, senior associate, or manager to its corporate development team. The job is in Mountain View, Ca.

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    Essential Reads

    Twitter has been engaged in an ongoing series of talks to acquire Flipboard in an all-stock deal that would value the company at more than $1 billion, reports Recode, which adds that though the two have numerous ties, talks “seem to be currently stalled.”

    —–

    Detours

    The digital artists who create those amazing “Game of Thrones” landscapes.

    Ask a tween: What is dating like?

    Why you think you’re the one doing all the work.

    —–

    Retail Therapy

    Sunoco Burnt Rubber Cologne. Somebody has a sense of humor at the oil company.

    Connie

  • StrictlyVC: May 22, 2015

    Oh, Friday, how we love you so.

    Hope you have a wonderful long weekend everyone! See you Tuesday.

    —–

    Top News in the A.M.

    The Pittsburgh Business Times give readers a first look at Uber’s self-driving test car. As you likely recall, in February, Uber announced plans to partner with Pittsburgh-based Carnegie Mellon to develop mapping, vehicle safety, and autonomous driving technologies. Since then, Uber has hired away 50 people from the school’s National Robotics Engineering Center (NREC) as it builds its own Advanced Technologies Center, a 53,000-square foot facility nearby. (Unsurprisingly, the arrangement is straining relations between Carnegie Mellon’s current and former employees.)

    ——

    Thumbtack Takes Its Own Investor, Google, Head On

    At a StrictlyVC event in San Francisco last week, Charles Hudson of SoftTech VC sat down with Sequoia Capital partner Bryan Schreier and Marco Zappacosta to discuss Thumbtack, an online marketplace for hiring workers that Zappacosta co-founded soon after graduating from Columbia University in 2007.

    Thumbtack is interesting for numerous reasons, including the amount of funding it has raised — $148 million over three rounds, all within a 14-month period – and who its investors are. Sequoia is among them (Schreier sits on Thumbtack’s board). So is Google, which provided Thumbtack with $100 million last summer – and, the business world recently learned, is now entering into direct competition with Thumbtack.

    Hudson, who spends much of his time studying marketplaces, asked Zappacosta and Schreier – a former Googler – about their “multifaceted” relationship with Google, among other things. That conversation, edited for length, follows:

    CH: How did Sequoia and Thumbtack come together?

    MZ: [Angel investor] Jason Calacanis introduced us to [Sequoia partner] Roelof Botha and another angel investor introduced us to Bryan. It was the fall of 2010. Unlike a lot of VCs, they were very explicit about what they thought was good and wasn’t yet good. When we [later] went back with numbers to show them [how we were growing], they did [write a check].

    CH: Many marketplaces sit in between the buyer and seller, but you’ve taken the opposite stance. Why?

    MZ: A lot of entrepreneurs and investors view the transactional model as a way to get a higher take rate. The problem in doing that is you’re solving your own problem; you’re not actually solving the customers’ problem at that point. There are times when you fundamentally [need to act as the facilitator]. Taking payment is key to making eBay work. It’s key to Uber, where speed is fundamental. But with Thumbtack, when a customer is spending $3,000 to repaint their house and you ask them what the hard part is, no one ever tells you it’s about paying the painter. It’s about finding the painter, and that’s the focus at Thumbtack. [Editor’s note: Thumbtack sends customer requests to service providers like plumbers, caterers, and painters. If the service provider thinks it’s a fit, they pay Thumbtack a fee to shoot a quote to the customer, who then chooses whether or not to work with that service provider.]

    CH: Is leakage –people going off platform to have a direct relationship – something you’ve ever worried about?

    MZ: If you haven’t created enough value for both sides to keep using your platform, that’s your problem.

    CH: [Tell us about your fees.]

    MZ: We’ve explicitly kept [them] very low — much lower than we think it could be. If you look at other marketplaces like Airbnb, it’s 10 to 12 percent. Uber is now 18 to 20 percent. eBay is like 13 percent. We’re below that and happily because our goal is to get market share. Today we move a billion dollars worth of commerce on the platform, which we feel good about, but that’s still nothing relative to the almost trillion dollars worth of commerce happening in the US. That’s the thousand x [opportunity] in front of us.

    CH: You recently raised $100 million from Google Capital. Google has also made some reference that they have designs on the home services market. 

    MZ: I have to give Bryan credit for board member words of encouragement when this happened, which is that if Google or Facebook or Amazon aren’t competing in your market, then you’re probably in a sh_tty market. And I think he’s exactly right.

    >BS: You felt better for like three seconds, right?

    MZ: [Laughs.] It’s indicative of the opportunity being enormous. I don’t perceive any sort of nefarious action on the part of Google Capital. I think it’s unfortunate. It’s a 50,000 to 60,000 person organization, but it’s why we’ve kept them at arm’s length. We’re excited to have them as investors, but we’ve been careful of that relationship accordingly.

    BS: Thumbtack connects people to people; they don’t connect companies. They don’t connect ads to people. It’s a very different business, with people on both sides who have an intimate relationship. This is something that Google has never been very good at. [It isn’t] intrinsic to their DNA.

    MZ: The opportunity and the challenge in this space is just how fragmented it is. There’s no natural point of aggregation as there is in retailing, where you can go to a distributor and instantly get access to 30 or 40 percent of the inventory in that category. So Google and Amazon — despite their money and brands and hard working employees — have to go out and recruit these plumbers and caterers one by one, and that’s a f_cking grind, one that we’re real good at, and one we’ve done without any salespeople and with a lot of technology and innovation.

    CH: How do you think about Amazon given its reach and scale and financial resources?

    BS: They still suffer from that corporate DNA issue, which is that they send packages to people, not people to people. And it’s very different. You have to get people on the phone when they’re fixing a toilet and really don’t want to be bothered.

    CH: You raised two fairly large rounds back to back. Why? 

    MZ: The truth, at the end of the day: it’s because you can. We didn’t need the money. The business is growing great and generating very real revenue. These rounds in happen in quick succession and in ever-growing numbers because companies . . . [in a big space and with a big vision] . . . can.

    —–

    New Fundings

    Biosyntia, a 3.5-year-old, Denmark-based synthetic biology and metabolic engineering company, has raised roughly $1.9 million in funding led by Novo Seeds. More here.

    Bitbar Technologies, a 20-year-old, Helsinki, Finland-based company behind a mobile development and testing service called Testdroid, has raised an undisclosed amount of new funding led by Inventure, with participation from earlier investors Qualcomm Ventures, DFJ Esprit, Creathor and Avera. More here.

    Brit Media, a 3.5-year-old, San Francisco-based content and commerce platform centered around DIY projects for women and girls primarily, has raised $23 million, according to an SEC form that was flagged by Business Insider. Among its new investors: Intel Capital. The company had previously raised  $7.6 million in funding from Index Ventures, Cowboy Ventures, Lerer Ventures, Marissa Mayer, and Oak Investment Partners.

    CyPhy Works, a 6.5-year-old, Danvers, Ma.-based maker of advanced unmanned aerial vehicles, has raised an undisclosed amount of funding from Draper Nexus. The company had previously raised $12.5 million in equity and debt, shows Crunchbase; its other backers include Lux Capital, General Catalyst Partners and Felicis Ventures.

    Guildery, a 1.5-year-old, Los Altos, Ca.-based e-commerce company that offers digitally printed fabrics and other home accessories like pillows, drapes, and ottomans, has raised $2.1 million in seed funding from Forerunner Ventures, Cowboy Ventures, SoftTech VC and AOL’s BBG Ventures. TechCrunch has more here.

    InRiver, an eight-year-old,  Malmoe, Sweden-based enterprise software company whose technology helps companies like Office Depot and BMW distribute their product information, has raised $10 million in Series A funding led by Verdane Capital Advisors. The company has now raised $13 million, shows Crunchbase.

    Iris PR Software, a three-year-old, Phoenix, Az.-based company that makes software for PR professionals, has raised $1 million in seed funding from individual investors. More here.

    MBio Diagnostics, a six-year-old, Boulder, Co.-based provider of clinical diagnostics and sample testing, has raised $6.3 million in Series B funding led by unnamed new and existing investors. The company had previously raised $2 million from unnamed investors.

    Outset Medical, a San Jose, Ca.-based company that has created a simple, at-home device that treats kidney failure, is in the process of raising $60 million dollars, the company tells MedCity News. The funding was provided by earlier investors Warburg Pincus and Vertical Group, as well as newer, unnamed backers. The company had previously raised $9.5 million, suggest previous SEC filings.

    Redbubble, an eight-year-old, Melbourne, Australia- and San Francisco-based online marketplace for artist-designed products, has raised $15.5 million in funding from Acorn Capital and Piton Capital, along with numerous individual investors, including Bebo cofounder Michael Birch and Ooga Labs founder (and now PayPay exec) Stan Chudnovsky.

    Rightpoint, an eight-year-old, Chicago, Il.-based digital agency and technology consultancy, has raised $55 million in funding from Stella Point Capital. Crain’s Chicago Business has more here.

    Softgarden, a 14-year-old, Berlin, Germany-based maker of recruiting software, has raised $3.3 million in funding from Cipio Partners and Neuhaus Partners.

    Wave, a 13-year-old, Kirkland, Wa.-based gigabit fiber and broadband services company, has raised $130 million via a bond sale led by Deutsche Bank and supported also by Wells Fargo, Sun Trust, and RBC Daniels. TechCrunch has more here.

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    New Funds

    Obvious Ventures, the nearly year-old, San Francisco-based venture capital firm started by Twitter co-founder and Medium CEO Ev Williams, has closed its debut fund with $123,456,789. “The number was absolutely intentional. We’ve got some math and computer science geeks — myself included — on the team and thought we’d have a little fun with our Form D filing,” Obvious Ventures co-founder James Joaquin tells Business Insider.

    ——

    IPOs

    Shopify, the nine-year-old, Toronto-based company whose software helps retailers sell goods online, went public yesterday, and its shares soared 51 percent. Meanwhile, another tech company that went public yesterday, eight-year-old, China-based Baozun, ticked up just 4.6 percent. TechCrunch has more here.

    —–

    Exits

    Clarabridge, a Reston, Va.-based company that makes so-called customer experience management software, has acquired Engagor, a Ghent, Belgium-based platform for real-time social customer service and engagement. The amount of the transaction was not disclosed. Clarabridge had raised $80 million in growth funding in late 2013 and acquired survey software provider MarketMetrix in 2014. Engagor had raised $2.6 million from Strike4 and Hummingbird Ventures.

    Zuora, an eight-year-old, Foster City, Ca.-based company that provides its customers with subscription billing, recurring revenue, payments, and billing software and services, has acquired two-year-old Frontleaf, a Oakland, Ca.-based customer usage analytics provider that had raised roughly $500,000, including an early check from Alchemist Accelerator. The financial terms of the transaction were not disclosed.

    —–

    People

    Scott McNealy, the longtime Sun Microsystems CEO and chairman, is back at the helm of a company. This time, it’s Denver-based Wayin, a startup that helps companies turn posts on social networks like Facebook into marketing messages. The WSJ has the story here.Oculus VR, the virtual reality company acquired by Facebook last year for $2 billion, is being sued by two men who say founder Palmer Luckey passed off work that he did for them as his own. The Recorder has the lowdown here.

    —–

    Jobs

    MassMutual Ventures, the small venture arm of the financial services company, is looking to hire an associate. The job is in Boston.

    —–

    Essential Reads

    Uber is seeking a $1 billion credit line from banks, reports the WSJ, adding that the move could ” signal an eventual initial public offering.”

    The 17 “hottest” startups in Germany, per Business Insider.

    —–

    Detours

    Ten U.S. ghost towns worth visiting.

    Gimlet Media releases its newest podcast, Mystery Show.

    Motorcycle surfing. (Gulp.)

    —–

    Retail Therapy

    We love these, though we’re also keen on obnoxious, old-fashioned arcade games. (They’re about half the price, too.)

    Connie

  • StrictlyVC: May 21, 2015

    Hi, everyone, happy Thursday!

    No column today. (Busy morning.)

    —–

    Top News in the A.M.

    Watch out, on-demand delivery startups: Amazon announced today that its Prime Now service will now start delivering goods from local stores in Manhattan, with plans to expand to other neighborhoods and cities later this year.

    A top Apple analyst thinks a new iPhone is coming in August.

    The NSA developed a plan to deliver malware through Google and Samsung app stores, according to newly published documents obtained by Edward Snowden and published by The Intercept and CBC News. More here.

    —–

    New Fundings

    Black Duck Software, a 13-year-old, Boston, Ma.-based company whose software helps enterprises with the logistical challenges that come with open source adoption and management, has raised $5 million in fresh funding, including from Siemens Ventures. According to Crunchbase, the company has raised at least $75 million over the years, including from SAP, General Catalyst Partners, Intel Capital, Sapphire Ventures, Flagship Ventures, and Volition Capital.

    CloudTags, a three-year-old, New York-based company whose omnichannel analytics tell retailers who their customers are prior to checkout, has raised $2 million in funding from IDEA Fund Partners, Alerion Ventures, Knoll Ventures and Hallett Capital. The company has raised $4 million to date, shows Crunchbase.

    Cove, a two-year-old, Washington, D.C.-based provider of shared “productive spaces,” has raised $2.8 million in Series A funding from unnamed investors. More here.

    Directly, a four-year-old, San Francisco-based company that makes on-demand customer service apps that are used by Airbnb, Pinterest and others, has raised $10 million in Series A funding led by Costanoa Venture Capital and earlier investor True Ventures, with numerous seed investors participating. The company had earlier raised $3.1 million in seed funding, including from CrunchFund and investor Gil Penchina. More here.

    Edo Interactive, an eight-year-old, Nashville, Tn.-based ad tech company, has raised $20 million in Series E funding from VantagePoint Capital Partners, Baird Capital, and several unnamed local firms. More here.

    EnergySage, a six-year-old, Boston-based online solar energy marketplace, has raised $1.5 million in Series A funding led by Launchpad Venture Group, with participation from New York Angels and the Clean Energy Venture Group.

    eProdigy, a seven-month-old, New York-based fintech holding company with several subsidiaries serving the alternative finance space, announced yesterday that it has landed $100 million from an unnamed private equity firm in the form of a term loan, a convertible note feature, and participation rights.  The convertible note portion is a $20 million facility with the noteholder’s right to convert the full amount to equity at a $100 million valuation. More here.

    FraudMetrix, a two-year-old, Hangzhou, China-based Internet security firm founded by several former Alibaba executives, has raised $30 million in Series B funding led by Qiming Venture Partners, with participation from earlier backers China Broadband Capital, IDG Capital Partners, China Growth Capital, and Linear Venture . China Money Network has more here.

    Fuze, a six-year-old, San Francisco-based cloud video conferencing company, has raised $20 million in growth funding from Hermes Growth Partners. The round brings the company’s total funding to $68.5 million, shows Crunchbase. Fuze has also acquired for an undisclosed amount LiveMinutes, an online team workspace platform. Four-year-old LiveMinutes, also based in San Francisco, had raised $3.2 million from investors, including Pritzker Group Venture Capital and Great Oaks Venture Capital.

    General Fusion, a 13-year-old, Vancouver-based developer of fusion energy, has raised roughly $22 million (U.S.) in new funding led by Khazanah Nasional Berhad, the Malaysian government’s strategic investment fund, along with earlier backers BDC Capital, Bezos Expeditions, Braemar Energy Ventures, Cenovus Energy, Chrysalix Energy Venture Capital, Entrepreneurs Fund, GrowthWorks, SET Ventures and Sustainable Development Technology Canada.

    Glowforge, a year-old, Seattle, Wa.-based startup that wants to make 3-D laser printers that are easy enough to operate and affordable enough for home users, has raised $9 million in Series A funding led by Foundry Group, with participation from True Ventures and ex-MakerBot executives Bre Pettis and Jenny Lawton. Venture Capital Dispatch has more here.

    Guerrilla RF, a two-year-old, Greensboro, N.C.-based company that provides monolithic microwave integrated circuits to wireless network infrastructure OEMs, has raised $2 million in Series B funding led by Charlotte Angel Fundand Piedmont Angel Network, with participation from other individual investors. The company has raised $3.5 million in funding to date.

    Jiff, a four-year-old, Palo Alto, CA-based health technology company cofounded by serial entrepreneur James Currier, has raised $23.3 million in Series C funding led by Rosemark Capital, with participation from GE Ventures, Venrock, Aberdare Partners and Aeris Capital. The company has raised roughly $50 million so far, shows Crunchbase. More here.

    Justworks, a 2.5-year-old, New York City-based human resources and payments platform  has raised $13 million in Series B funding led by Bain Capital Ventures, with participation from previous backers Thrive Capital and Index Ventures. The company has now raised $20 million altogether.

    Liqid, a 2.5-year-old, Lafayette, Co.-based  data center startup operating in stealth mode, has raised $5.7 million in seed funding from Kingston Technology, Phison Electronics Corp., ABR Capital Management, and DH Capital. More here.

    Logmatic.io, a year-old, Paris-based SaaS-based log management platform, has raised $1 million in funding led by ISAI Seed Club.

    Lookup, a nine-month-old, Bangalore, India-based free and secure messaging app that connects shoppers with local businesses, has raised an undisclosed amount of Series A funding from Twitter co-founder Biz Stone. The company had previously raised $382,000 in seed funding from angel investors. The Economic Times has more here.

    Maana, a three-year-old, Palo Alto, Ca.-based company that’s been developing a search engine technology for big data, has raised $11 million in Series A funding from investors, including Chevron Technology Ventures,ConocoPhillips Technology Ventures, Frost Data Capital, GE Ventures, and Intel Capital. The company has now raised more than $14 million altogether. More here.

    Metabiota, a seven-year-old, San Francisco-based developer of epidemic prediction and prevention software, has raised $30 million in Series A funding led by RSTP, with participation from Capricorn Healthcare, WP Global Partners, Industry Ventures, and Data Collective. The company has now raised $32.8 million altogether.

    Qwilr, a year-old, Syndey, Australia-based platform whose cloud-based tools aim to make it easy to turn business documents into webpages (and replace PowerPoint decks in the process), has raised AUD $500,000 (about $395,000) in seed funding from investors, including Sydney Seed Fund and Macdoch Ventures. TechCrunch has more here.

    Regenexbio, a six-year-old, Rockville, Md.-based gene therapy company, has raised $70.5 million in Series D funding led by Vivo Capital, with participation from Brookside Capital, Venrock, Janus Capital Management, Jennison Associates, Perceptive Advisors, QVT Financial, Tourbillon Global Ventures, Sectoral Asset Management, Cormorant Asset Management,Foresite Capital Management, RTW Investments, Deerfield Managementand Fidelity Biosciences.

    Stripe, the five-year-old, San Francisco-based online payments processor, is raising a new round of funding that could reach $500 million, and at a $5 billion valuation, according to TechCrunch sources. To date, the company has raised $190 million from investors, including Khosla Ventures, Andreessen Horowitz, and Sequoia Capital, as well as investor-operators Elon Musk,Peter Thiel, and Aaron Levie.

    Samanage, an eight-year-old, Israel-based SaaS platform for managing internal assets, has raised $16 million in Series B funding co-led by Marker andVintage Investment Partners, with participation from earlier investorsCarmel Ventures, Gemini Israel Ventures and Silicon Valley Bank.

    Taplytics, a year-old, San Francisco, Ca.-based enterprise mobile A/B testing platform, has raised $2.4 million in seed funding from a long list of prominent individual investors, including serial entrepreneur Justin Kan and Matt Cutts, the longtime head of Google’s web spam team.

    Wibbitz, a four-year-old, Tel Aviv, Israel-based text-to-video startup, has raised $8 million in Series B funding led by NantMobile, founded by L.A based billionaire physician and entrepreneur Patrick Soon-Shiong. Earlier investorsHorizon Ventures, Lool Ventures, Initial Capital and Kima Ventures also participated. Geektime has more here.

    —–

    New Funds

    Formation 8, the three-year-old, San Francisco-based venture firm, has quietly held a first close on a new $100 million-targeted fund that will invest exclusively in hardware companies, reports Fortune. Among the fund’s LPs is Flextronics.

    Glilot Capital Partners, a four-year-old, Tel Aviv, Israel-based venture capital firm investing in early-stage, Israeli cyber-security and enterprise software start-ups, has raised a second fund with $77 million from limited partners, including Bank Hapoalim, Israel’s largest bank. The firm’s debut fund had closed with $30 million, which it invested across eight companies. Those include cloud security startup Aorato, which Microsoft acquired for a rumored $200 million, and the inbound marketing platform Insightera, which was acquired by Marketo for $20 million.<

    GreenSoil Investments, a four-year-old, Toronto-based investment firm, has held a first close of $25 million for its third fund, which is targeting between $80 million and $100 million. The firm now has $56 million in assets under management. More here.

    Ignition Partners, the 15-year-old firm with offices in Bellevue, Wa., and Palo Alto, Ca., has officially closed its sixth fund with $200 million, money it will invest in early-stage enterprise software startups. (We told you about this fund in March, when the firm filed an SEC form that stated its target.) Ignition says it could have raised more than $300 million from endowments, foundations, fund of funds and family offices but that it chose to stick to its core “boutique” model.

    The band Linkin Park recently launched a venture fund that’s targeting consumer-facing startups. We’re tempted to poke fun, but in the end (yes), they’ve assembled some pretty attractive stakes, including in the ride-sharing platform Lyft; the free-trading app Robinhood; and Shyp, the shipping app. CNN Money has more about the band’s firm, Machine Shop Ventures, here.

    Osage University Partners, a Philadelphia area-based venture capital firm that invests exclusively in startups that are commercializing university research, has closed its second fund with $215 million. The group has signed deals with 68 U.S. and two Israel universities and research institutions.

    Vistara Capital Partners, a Vancouver, Canada-based growth capital firm, has raised $80 million for its debut fund. The firm, which is targeting an overall fund size of $100 million, provides growth capital financing (debt and equity) to mid- and later-stage tech companies across Canada and the U.S.. The fund will invest in both private and public companies, providing between $5 million and $15 million per investment, with capital saved for follow-on investments. More here.

    —–

    IPOs

    Etsy, the 10-year-old, Brooklyn-based online crafts marketplace, saw its shares plunge 23 percent yesterday, a day after it posted a wider-than-expected loss in the most recent quarter. International Business Times has more here.

    Shopify, the nine-year-old, Toronto-based company whose software helps retailers sell goods online, priced its IPO yesterday at $17 a share, above the top end of a price range that had already been raised because of strong investor demand. More here.

    —–

    Exits

    Handy, a 3.5-year-old, New York-based on-demand cleaning, plumbing and other home services platform, is in talks to acquire its slightly younger, less well-capitalized, San Francisco-based rival, Homejoy, says TechCrunch. According to Crunchbase, Homejoy has raised at least $40 million, from First Round Capital, Google Ventures, Max Levchin, Redpoint Ventures, Signatures Capital, and Pejman Mar Ventures. Meanwhile, Handy has raised at least $60 milion, including from Sound Ventures, TPG Growth, Revolution, General Catalyst Partners, and Highland Capital Partners.

    TheLadders, the 12-year-old, New York-based online recruitment service, is nearing a sale, according to Fortune.

    —–

    People

    The venture-backed big-data software company ClearStory Data has named long-time Silicon Valley technologist Timothy Howes as chief technology officer, reports VentureWire. Howes has previously held CTO spots at Netscape, Opsware, HP’s enterprise software business, and RockMelt.

    —–

    Jobs

    Lift Ventures, a San Francisco-based startup studio, is looking to hire an associate.

    —–

    Data

    Atomico Ventures looks at 182 software companies worth more than a billion dollars and concludes that increasingly, they aren’t from the U.S.. They’re also hitting their “unicorn” status faster than ever. Silk lays out Atomico’s data here.

    —–

    Essential Reads

    The clock is ticking for Dropbox, argues Business Insider.

    Things are rocky for smartwatch maker Pebble, too, reports TechCrunch.

    The state of California has forced venture-backed Leap Transit to stop operating its luxury bus line without a permit.

    Spotify says it’s becoming a platform for more than just streaming music.

    —–

    Detours

    Letterman says goodbye.

    The plan to move an entire Swedish town.

    This is why we’re terrible with names.

    —–

    Retail Therapy

    Live like Woz. Buy the Los Gatos, Ca. house built just for him.

    (Also, in case you’re interested: Fast Company has just posted a little-seen Apple video with Steve Jobs and Steve Wozniak talking about the company’s beginnings.)

    Connie

  • StrictlyVC: May 20, 2015

    Hi, everyone, happy Wednesday. It was fun seeing some of you yesterday at the jam-packed On-Demand conference in San Francisco. We moderated the last discussion, parts of which we’ll share with you here soon. (It was pretty interesting, thanks to some great VC panelists.)

    —–

    Top News in the A.M.

    Why Tweets are about to dominate your Google searches.

    —–

    Pantera Capital’s Dan Morehead on the Future of Bitcoin

    At a StrictlyVC event in San Francisco last week, Dan Morehead, founder of the San Francisco-based hedge fund Pantera Capital, sat down with seed investor and venture advisor Semil Shah to talk Bitcoin.

    Morehead knows Bitcoin as well as anyone. After logging time at Deutsche Bank and Goldman Sachs, then joining Tiger Management, where he rose to the head of global macro trading, Morehead founded Pantera, a 12-year-old outfit that has more recently committed to investing exclusively in Bitcoin and other digital currencies. We wanted to know why — as did Shah — so Shah asked him. Parts of their discussion follow, edited for length.

    SS: There was exuberance over Bitcoin, then not, and now it’s coming back. What’s going on?

    DM: Every technology goes through a hype cycle, where there’s a kernel of truth or a kernel of genius, and once the media catches it, it [captures everyone’s imagination] for a while. Then there’s an awkward period. And Bitcoin went through that. [But] it was more extreme because it has one unique feature. It’s a technology protocol that has a real time price feed. And that’s really, really weird.

    In 2011, no one really cared. By 2013, everyone had [that price feed] on their screens and the press was talking about it, and it led to extreme bubbles [including in Bitcoin mining]. At the end of 2013, the price of Bitcoin was 93 times higher than it was the year before. Bitcoin improves all the time, but it wasn’t 93 times better, so a bubble . . . had to deflate.

    SS: Was it rational for Bitcoin’s price volatilty to affect venture investment in the technology?

    DM: I think people did get over their skis in 2013, thinking it was going to change the world overnight. It’s going to change the world, but it’s going to take a couple decades to do it, as other Internet protocols [have taken].

    One data point about Bitcoin: All the companies in the Bitcoin ecosystem are worth just over $3 billion today. All the Bitcoin that exist are about worth that right now. So you have a ration of about 1:1. Meanwhile, in talking about the U.S. equity market or the developed company space, the market cap of all the companies in the U.S. is worth five times the value of money supply. So I think you’re going to see a persistent trend of value venture in Bitcoin increasing at a faster pace than the underlying currency or protocol.

    SS: Numerous traditional VCs have made bets on seed- and early-stage Bitcoin companies, but it seems like these bets will take longer [than expected] to play out. Will they have to continue supporting these companies, or will other investors come down the stack?

    DM: It’s certainly taking longer than some people expected a few years ago. But you’re seeing [an influx] of investors. Last month, Circle [Internet Financial] did a round with Goldman Sachs, which was the first major international bank to invest. So not only are you getting the traditional venture investors, but you’re getting strategic investors like big banks and big exchanges trying to get invested in the Bitcoin space.

    SS: You understand Wall Street. How does it perceive Bitcoin, both as a currency and as a technology platform?

    DM: I think most of Wall Street realizes that the systems that move money are incredibly antiquated and incredibly inefficient. Most of them were designed in the 1950s. The main thing for wiring money – SWIFT – is basically sending messages and it’s very primitive and can be disrupted by Bitcoin very easily, and most banks would like to see that happen.

    SS: How would that affect big banks’ fees and the way they make money?

    DM: I think too much was made in the early days of [Bitcoin’s ability] to disrupt banks. A lot of banks now have retail stores – selling services to people. So they can still retain their relationship with the customer and then swap out the back end.

    Also, there are a small number of banks that do cross-border money movement; they’re called correspondent banks, and there’s really only a dozen or so that control an entire market. An extreme example is Africa, where, if you want to move money into or out of the entire continent, there are only two banks that will do it and other banks need to use those two banks and it’s very expensive. So banks want a cheaper way to get money in and out of places like that.

    SS: What is happening in Bitcoin in the rest of the world outside the West, especially where rule of law is weak?

    DM: In mobile money, Kenya is actually the world leader. Southern Africa has weak institutions and currencies that deflate at a rapid rate; Zimbabwe is the world record holder with a 100 trillion dollar note now. So their citizens need a better solution to transact.

    They also are unbanked [along with billions] of other people on earth that don’t have access to a bank but do have a cellphone, and going straight to some mobile money solution — bitcoin is a great solution for that. Already, 75 percent of adults in Kenya use a mobile system called M-Pesa. In fact, 45 percent of the entire GDP of the country is processed in M-Pesa. To me, that’s the future of bitcoin.

    (If you’d like to hear more from this discussion, you can listen to it in its entirety here.)

    —–

    New Fundings

    Algolia, a three-year-old, San Francisco-based company whose hosted search API allows websites and mobile applications to deliver search without having to build it out, has raised $18.3 million in funding led by Accel Partners, with participation from Lead Edge Capital and earlier backers Alven Capital, Point Nine Capital and Storm Ventures. Individual investors, including Ilya Sukhar of Parse and Solomon Hykes of Docker, also joined the round. The company has now raised $21.1 million altogether. TechCrunch has more here.

    AlphaDraft, a year-old, San Diego, Ca.-based e-sports startup, has raised $5 million in seed funding from investors, including Metamorphic Ventures, William Morris Endeavor Entertainment, Melo7 Tech Partners, former NBA Commissioner David Stern, Upfront Ventures, IDG Ventures, KEC Ventures, Freestyle Capital, SK Ventures, Basset Investment Group, Gokul Rajaram, and Amplify.LA, which furnished the company with its first check earlier this year. The L.A. Times has more here.

    Blade, a year-old, New York-based app and logistics company centered around helicopter use (think Uber for choppers), has raised  $6 million at a $25 million valuation from some big names, including Google chairman Eric Schmidt, Discover Communications CEO David Zaslav, IAC’s Barry Diller, Alex von Furstenberg, Raine Ventures, and iHeart Media chairman Bob Pittman. Both Pittman and Schmidt have licenses to fly helicopters and jets, notes Business Insider, which has the story here.

    BookBub, a three-year-old, Cambridge, Ma.-based daily newsletter providing millions of readers deals on e-books, has raised $7 million in new equity and debt financing from undisclosed sources. The company had raised $3.8 million in Series A funding last year from NextView Ventures, Founder Collective,Avalon Ventures, and Bloomberg Beta. BetaBoston has the skinny here.

    Coho Data, a 3.5-year-old, Palo Alto, Ca.-based company that makes software-defined networking integrated storage appliances for private clouds, has raised $30 million in funding led by March Capital Partners, with participation from Hewlett Packard Ventures, Intel Capital and earlier investors Andreessen Horowitz and Ignition Partners. The company has now raised $67 million altogether.

    Farmers Business Network, a 1.5-year-old, San Francisco-based company whose computer systems evaluate public and private data on crop yields, weather patterns and planting practices, has raised $15 million in funding led by Google Ventures. Venture Capital Dispatch has more here.

    FlyOnWall, a two-year-old, New York-based live-streaming company formerly known as LiveLens, has raised $3 million in Series B funding from private investors. The company had previously raised $2.5 million from investors (also unnamed). More here.Little Labs, a year-old, L.A.-based smartwatch app studio, has raised $3 milion in funding led by New Enterprise Associates, with participation from Lightspeed Ventures, Lowercase Capital, and earlier backers Crosscut Ventures and Amplify.LA. More here.

    Mobcrush, a 10-month-old, Santa Monica, Ca.-based live streaming platform for mobile games, has raised $4.9 million in seed funding from a long list of investors, including Raine Ventures, First Round Capital, Lowercase Capital, CrunchFund, Rincon Venture Partners, Crosscut Ventures, Lionsgate, Advancit Capital, CAA Ventures, BAM Ventures, MTGx Ventures, and numerous individual investors.

    Oradian, a three-year-old, Zagreb, Croatia-based startup that makes cloud-based software for micro finance institutions in developing markets, has raised an undisclosed amount of seed funding from Credo Ventures, Playfair Capital, Day One Capital, Esther Dyson, Moaffak Ahmed and Pule Taukobong (Africa Angels Network). TechCrunch has more here.

    Shelvspace, a three-year-old, Scottsdale, Az.-based SaaS company targeting the consumer packaging goods industry, has raised $1 million led by Tallwave Capital, with participation from numerous individual investors.Stride Health, a two-year-old, San Francisco-based health insurance recommendation engine, has raised $13 million in Series A funding led by Venrock, with participation from Fidelity Biosciences and earlier investor New Enterprise Associates. The round brings Stride’s total to $17.5 million,reports TechCrunch.

    Tilt, a three-year-old, San Francisco-based crowdfunding platform, has raised a new round of funding that values the company at $400 million. TechCrunch has the story here. Tilt had previously raised roughly $37 million from investors, including Y Combinator, Andreessen Horowitz, QueensBridge Venture Partners, SV Angel, Sean Parker, Naval Ravikant, Silicon Valley Bank, Alexis Ohanian, and Felicis Ventures.

    WePay, a seven-year-old, Palo Alto, Ca.-based payments companies built to serve the needs of online marketplaces, has raised $40 million in Series D funding from the growth equity firm FTV Capital. The company has now raised roughly $74 million altogether, shows Crunchbase. Fortune has more here.

    Zaption, a three-year-old, San Francisco-based video learning company, has raised $1.5 million in seed funding from investors, including NewSchools Venture Fund, Redcrest Enterprises, Scion Capital and Telegraph Hill Capital. More here.

    —–
    New Funds

    Enmi Kendall and Anya Schiess met more than 10 years ago at business school; now, the two have reunited to form Healthy Ventures, a new seed-stage venture capital firm that’s attempting to get digital health ventures off the ground. Geekwire has the story here.Norwegian state-owned utility Statkraft AS has set up a venture capital unit, which will invest up to $11 million per year in clean energy-related start-ups in Europe. More here.

    —–
    Exits

    Booxmedia, a six-year-old, Helsinki-based cloud-TV platform, has been acquired by the Cambridge, U.K.-based, AIM-listed company Amino for €7.9 million ($8.8 million). According to Crunchbase, Booxmedia had raised roughly $580,000 in seed funding from individual investors. TechCrunch has more here.

    Next Big Sound, a seven-year-old, New York-based online music analytics platform, has been acquired by the streaming music service Pandora for undisclosed terms. According to Crunchbase, the company had raised roughly $8 million from investors, including Alsop-Louie Partners, Foundry Group,  IA Ventures, and SoftTech VC. VentureBeat has more here.

    Predilytics, a four-year-old, Burlington, Ma.-based predictive analytics company, has been acquired for undisclosed terms by the health management company WellTok, based in Denver. Predilytics had raised $20.5 million from investors, including Highland Capital Partners, Flare Capital Partners, Flybridge Capital Partners, Qualcomm Ventures, and Google Ventures. More here.

    Weathermob, a four-year-old, Boston-based company that uses crowdsourcing to provide an alternative to data from traditional weather stations, has been acquired by Weathernews, a nearly 30-year-old weather prediction technology company based in Chiba-shi, Japan. TechCrunch has more here.

    WooCommerce, an e-commerce tools company based in Cape Town, South Africa, has reportedly sold to WordPress parent company Automattic for roughly $30 million in cash and stock. Automattic CEO Matt Mullenweg wouldn’t comment on the price, but he told Recode yesterday that the acquisition is the largest his company has made  “by about 6x.”

    —–

    People

    Feroz Dewan, who has long run the hedge fund operations of Tiger Global Management — and helped steer it into numerous bets on privately held tech companies  —  is leaving next month to start his own business. Reuters has more here.

    Ilya Fushman, head of product at Dropbox, has left the company to become a general partner at Index Ventures, joining partners Danny Rimer and Mike Volpi at the venture firm’s San Francisco office. Index Ventures had led Dropbox’s $250 million Series B round in 2011, so the two sides know each other well. Fushman is no stranger to venture capital, either. Before joining Dropbox, he spent a roughly 1.5 years at Khosla Ventures as a principal. Business Insider has the scoop here.

    Mike Kail, CIO and SVP of infrastructure at Yahoo, has left the company after less than a year, reports the WSJ. Kail “has chosen to leave the company in order to pursue other opportunities,” Yahoo told the outlet. Presumably, he’s also busily battling a lawsuit filed against him by Netflix, his former employer, which has accused Kail of fraud, breach of fiduciary duties and other improper actions.

    David Lee has left the venture firm SV Angel after numerous years as its managing partner, according to a letter sent to its limited partners and companies. Recode has that letter here. Lee says (for now) that he’s leaving to spend more time with his family. In the meantime, Topher Conway will be moving up to the co-managing role alongside his father, SV Angel founder Ron Conway, notes TechCrunch.

    On Monday night, at a Fortune dinner in New York, Yahoo CEO Marissa Mayer said the best advice she has ever received came from Google cofounder Sergey Brin, who told her on her last day at Google: “Don’t forget to be bold.” More here.

    Every two years, Amazon founder Jeff Bezos annoints a new “shadow,” a person who acts as his advisor, sits by his side in meetings, and serves as a sounding board before being sent back into another role at the company. This time, it’s Maria Renz, who was most recently CEO of Quidsi, the parent company of Diapers.com that Amazon acquired in 2011. Recode has the story.

    Alexia Tsotsis, co-editor of TechCrunch, is stepping down to attend graduate school at Stanford. “I may never have another job I’ll love as much as this one, but I need to click on to the next gallery slide of my life,” she explained in a post this morning. More here.

    —–

    Jobs

    Yelp is hiring a senior manager of corporate development. The job is in San Francisco.

    —–

    Essential Reads

    Six Chinese men have been indicted for the theft of code from Silicon Valley companies. The New York Times has more here.

    —–

    Detours

    Don Draper’s complicated relationship history in one chart.
    —–

    Exits

    SaloonBox, because not everyone can mix a drink like Tom Cruise in “Cocktail.” (Not that we ever sat through all two and a half hours of  “Cocktail.” Ahem.)

    Connie

  • StrictlyVC: May 19, 2015

    Happy Tuesday, everyone! Apologies if you couldn’t find your issue of StrictlyVC yesterday. Google flagged it as spam for some reason that probably has nothing to do with our featuring a former Google exec who left for Uber, though we are not above planting that seed.:)

    If you were looking for it, it’s here.

    —–

    Top News in the A.M.

    Jawbone, the San Francisco-based wearable technology company, recently landed a $300 million investment from BlackRock, the asset management giant. But the investment wasn’t a $300 million cash infusion, reports BloombergView; it was a loan that offers BlackRock many protections, as well as gives it power over hiring, firing, and dealmaking. More here.

    A survey released this morning shows many drivers aren’t just texting; they’re using Facebook, Snapchat and Twitter, taking selfies, and even shooting videos. The New York Times has more here.

    —–

    AOL President Luke Beatty on What Happens Now

    Luke Beatty has had a busy couple of weeks. As President of Media Brands at AOL, Beatty manages an assortment of online media properties, including Techcrunch, Engadget, and MapQuest from his home base in Denver, Colorado. And he’s been spending a good amount of time helping his teams make sense of Verizon’s acquisition offer. (Verizon’s plan to buy AOL for $4.4 billion has yet to formally close.)

    Beatty’s ties to AOL run deep. He roomed with AOL CEO Tim Armstrong during and after college; installed Armstrong on the board of his content platform, Associated Content, which sold to Yahoo in 2010; and joined AOL as an executive in August 2013.

    We asked Beatty if he could explain Armstrong’s thinking around the deal to our readers. Parts of that chat follow, edited for length.

    You oversee nine different properties. How did people react to the news that Verizon is buying AOL?

    When you have a big mixed group like that, and a big announcement like [we had], to try to bundle everybody’s perspective into a common theme is difficult. The majority of my brands have come to AOL by way of acquisition, so I think they already understand what it’s like to be part of a publicly traded company.

    I think a lot care about the decision and they’re interested to see how it affects them both personally and professionally, particularly brands like TechCrunch and Engadget that are engaged in that world and are interested in knowing: Am I going to maintain my editorial independence? Meanwhile, with MapQuest, the implications of being owned by Verizon are very different and can present new opportunities that can be very exciting for them.

    What is going to happen to the content sites? Reports suggest Tim Armstrong is leaving the door open to numerous possibilities.

    I can firmly say there is zero intention on Verizon’s part to spin off the brands or sell them or to find a new home for them. They’re very focused on our media brands and there’s zero interest in divesting any of the brand outfits.

    Does anyone’s role change? Does yours?

    I don’t see any of our roles changing. We’re operating as an independent company within Verizon, run by Tim, and we plan to operate as we do now.

    What about acquisitions? Will your pacing change as a subsidiary of Verizon?

    We’re going to stay as active or more active than we’ve ever been [relating to] all three parts of AOL. I think that Verizon expects [it].

    One of the secrets to our success: We have a very unique strategy in the sense that when we acquire brands like TechCrunch or [the web ad platform] Adaptv on the platform side, we keep the teams and offices and culture together. We’re not great at everything, but that’s something AOL is great at – retaining expertise and talent.

    Given the beating that ad tech valuations have taken, might Verizon look to add even more pieces to its new ad tech business? Are there gaps it will look to fill?

    As the market evolves and new publisher services are needed, I expect the platform side to continue to add where they need to. If you look at acquisitions that [AOL Platforms CEO] Bob Lord and the [digital advertising] platform side have made over time, it’s been a steady drumbeat of acquisitions, including, recently, with Vidible [bought by AOL in December for a reported $50 million]. We also build internally.

    What part of the deal do you think people don’t fully appreciate or understand?

    [The acquisition] is huge opportunity for a lot of the brands at AOL, many of which are rooted in blogging and are now very popular brands that are moving to video. For example, “Crunch Report ” – a daily show on TechCrunch —  [you’ll see] that stuff happening more and more. The move to video is extremely exciting, and to have a partner like Verizon that has a big [over-the-top] audience and video distribution [reach] is a huge advantage for us.

    AOL made a big push into video last fall. What have you learned about what consumers want and don’t want, and what percentage of content are you shifting to video?

    Video across all our brands has been growing every month but it’s not like there’s a template, [like] we have to get to the point where 25 percent of the content we produce has to be video. It depends on the brand and the topic and categories. Some things in the tech space are sort of short form. HuffPo is getting into more long-form stuff. It’s about finding the right format for the message.

    What we are seeing, particularly concerning the tech brands, is that three years ago, they were [tailored] for [more niche audiences]. A brand like TechCrunch was for people who were in the business; Engadget was a site about the newest products, gadgets, and technologies, but it was for people inside tech companies. Now, people everywhere care about technologies and how they’re being funded. They want to see Marissa Mayer and Mark Zuckerberg [talk about] what they achieved in the last year. Video is helping that happen. It’s helping [people who don’t work in tech] get up to speed.

    —–

    New Fundings

    Acast, a year-old, Stockholm- and London-based podcasting app and web service, has raised $5 million in Series A funding from Bonnier Growth Media and earlier investor Moor. Reuters has more here.

    Akosha, a five-year-old, New Delhi, India-based messaging platform that connects customers directly to businesses, including Snapdeal, has raised $16 million in Series B funding led by earlier backer Sequoia Capital. The company has now raised $21.6 million altogether, reports TechCrunch.

    Bd4travel, a two-year-old, Frankfurt, Germany-based startup that offers a predictive analytics platform to the online travel industry to help profile and target site visitors, has raised $4.2 million in Series A funding led Hoxton Ventures, with participation from Talis Capital, and Robin Klein of The Accelerator Group. TechCrunch has more here.

    BetterCompany, a 1.5-year-old, San Francisco-based company that’s been developing a workplace communication platform, has raised $6 million in Series A funding led by BlueRun Ventures. The company had previously raised $1.7 million in seed funding from David Sacks, Adam Nash and numerous other angel investors. More here.

    DataHero, a 3.5-year-old, Palo Alto, Ca.-based data analytics startup, has raised $6.1 million in Series A funding led by Foundry Group. The company has now raised $10.3 million altogether, shows Crunchbase. More here.

    Dvtel, a 15-year-old, Ridgefield Park, N.J.-based video surveillance software company, has raised $9 million in funding from investors, including Seacoast Capital and EGIS Capital Partners. More here.

    eVolution Networks, a 2.5-year-old, Ramat-Gan, Israel-based company whose tech analyzes a mobile network’s traffic needs and adjusts the use of its resources based on real-time demand from subscribers, has raised $22.5 million in funding from IES Holding and GE Ventures.

    Exablox, a five-year-old, Sunnyvale, Ca.-based cloud storage company has added $7 million to a previously closed round of $16 million in Series C funding. The company’s newest investor is Toshiba America Electronic Components; it joins Dell Ventures in the round. Altogether, Exablox has now raised $45.5 million. More here.

    Feedzai, a 3.5-year-old, San Mateo, Ca.-based data science company that provides fraud prevention and detection services, has raised $17.5 million in Series B funding from backers, including Oak HC/FT, Sapphire Ventures, and Espirito Santo Ventures. The company has now raised $22 million altogether, shows Crunchbase. American Banker has more here.

    Flow Forward Medical, a five-year-old, Olathe, Ks.-based company whose external blood pump product helps quickly establish vascular access for hemodialysis, has raised $1.3 million in funding led by earlier backer the Kansas Bioscience Authority. The company had previously raised $4.4 million. More here.

    Hightower, a two-year-old, New York-based company whose enterprise app helps commercial real-estate brokers and owners manage their leasing operations via their mobile phones, has raised $13 million in Series B funding from RRE Ventures, Bessemer Venture Partners, Thrive Capital and Pritzker Venture Capital. The company has now raised $21.7 million altogether, shows Crunchbase.

    Meteor Development Group, a four-year-old, San Francisco-based JavaScript-based open-source platform that aims to make app development simple for developers, has raised $20 million in new funding led by Matrix Partners with participation from Andreessen Horowitz and Trinity Ventures. The company has now raised $31.2 million altogether, shows Crunchbase.

    MuleSoft, a nine-year-old, San Francisco-based company whose software automatically integrates disparate data, applications and application programming interfaces so they can all work together, has raised $128 million at a valuation of $1.5 billion from at least a dozen corporate, public market and venture capital investors, including Salesforce Ventures, which led the deal. The company — which had previously talked of going public soon — has now raised $259 million altogether. The WSJ has more here.

    iSpot.tv, an analytics firm that tracks national TV ads and related digital activity in real-time, has raised $21.9 million in Series B funding led by Insight Venture Partners, with participation from earlier backer Madrona Venture Group. The company had previously raised $5.9 million across two rounds. MediaPost has more here.

    Palico, a three-year-old, New York and Paris-based online marketplace for the private equity fund community, has raised $7.3 million in equity funding from six unnamed family offices and private equity executives from Europe and the U.S., says the company, which has now raised $19.2 million altogether.

    Polyera, a 10-year-old, Skokie, Il.-based startup that creates flexible electronics platforms to be used in wearables, mobile devices, and the Internet of Things, has just raised $24.5 million in Series C funding led by Chengwei Capital and Tsing Capital. The company originally spun out of Northwestern University. ChicagoInno has more here.

    PsiOxus, a five-year-old, Oxford, England-based oncolytic immuno-oncology company, has raised $38.5 million in Series C funding led by earlier backerImperial Innovations, with participation from Woodford Patient Capital Trust and other previous investors Invesco, SROne, Lundbeckfond Ventures and Mercia Technologies. According to Crunchbase, the company has raised at least $73.4 million to date. More here.

    Ripple Labs, the three-year-old, San Francisco, CA-based creator of the Ripple payment protocol and exchange network, has raised $28 million in Series A funding from a long list of backers. They include: IDG Capital Partners, the venture arms of CME Group and global data storage company Seagate Technology, Jerry Yang’s AME Cloud Ventures, ChinaRock Capital Management, China Growth Capital, Wicklow Capital,Bitcoin Opportunity Corp., Core Innovation Capital, Route 66 Ventures, RRE Ventures, Vast Ventures, and Venture 51. The company has now raised $37 million altogether, shows Crunchbase.

    Samsara, a months-old, San Francisco-based company that’s developing a simple, affordable sensor system that includes hardware, networking software and data analytics, has raised $25 million in first-round funding led by Andreessen Horowitz. Numerous individual investors, as well as the company’s founders — whose previous company, Meraki, was acquired for $1.2 billion by Cisco in late 2012 — also participated. Fortune has more here.

    Speakeasy Tech, a 1.5-year-old, San Francisco-based conference calling company, has raised $4.8 million in Series A funding from Bessemer Venture Partners and Salesforce Ventures. More here.

    Stox, a 10-month-old, Israel-based online broker cofounded by Yo cofounder Or Arbel, has raised $8 million from the Israeli venture capital firm Singulariteam, an investment firm headed by Yo’s other cofounder, Moshe Hogeg. Business Insider has more here.

    Switch Communications, a four-year-old, San Francisco-based cloud-based phone system built for Google App users, has raised $35 million in new funding led by the cross-border VC firm Amasia Associates. Other participants included Felicis Ventures, SoftBank, Work-Bench Ventures, and earlier backers Andreessen Horowitz and Google Ventures. The company has now raised $53 million altogether. TechCrunch has more here.

    Trafi, a 1.5-year-old, London-based company whose public transport app helps users plan their journeys, has raised $6.5 million in Series A funding led by Octopus Investments, with participation from EBRD Venture Capital Investment Programme, BaltCap, and previous investor Practica Capital. TechCrunch has more here.

    Xiu.com, a seven-year-old, Shenzhen, China-based e-commerce platform that sells luxury and fashion products, has raised $30 million in Series C funding led by Pacific Venture Partners, with participation from the company’s founders and previous investor Kleiner Perkins Caufield & Byers. The company had raised at least one, previous undisclosed round, and another round of $100 million led by Warburg Pincus in 2011, says China Money Network.

    —–

    People

    Charles Birnbaum is being promoted to vice president at Bessemer Venture Partners, which he joined a couple of years ago as a senior associate. Birnbaum, who is based in New York, previously spent four years as a director of business development at Foursquare. Earlier in his career, he worked as an investment banking analyst, including at Banc of America and Jefferies & Co.

    Sara Sperling has joined the local delivery services company DoorDash as HR director, she announced on Facebook yesterday. Sperling was most recently Snapchat’s HR director, leaving in February after a six-month stint owing to personal reasons, Recode reported at the time. She’d previously spent more than four years at Facebook, where she reportedly built internal programs and community groups for employees, as well as headed up its diversity efforts.

    —–

    Jobs

    5AM Ventures, the life sciences investment firm, is looking to hire a principal. The job is in Menlo Park, Ca.

    —–

    Essential Reads

    Inside Google’s secret war against ad fraud.

    Apple quietly shelved plans to make a high-definition TV set more than a year ago, according to WSJ sources.

    The rebirth of venture capital in France.

    —–

    Detours<

    Even very young children in the U.S. aren’t active enough, says a new study.

    A billionaire makes the case for gap years.

    A sub-seven-minute lap around Nurburgring, the famous German motorsports complex.

    —–

    Retail Therapy

    A duvet set for the young equestrian in your life.

    The Super Gorone desk, otherwise known as the “relationship killer.”

    Connie

    ,

  • StrictlyVC: May 18, 2015

    Hi, welcome back, everyone! Hope you had a terrific weekend.

    —–

    Top News in the A.M.

    Google will reportedly launch buy buttons on its search-result pages in coming weeks, pitting it more directly against online marketplace rivals, including Amazon and eBay.

    —–

    Uber Exec Tom Fallows on the Company’s Culture, and More

    At a StrictlyVC event in San Francisco last week, Tom Fallows, Director of Global Expansion Products at Uber, talked with us about what’s important to Uber right now, why Uber sees the fight for India and China as far from over, and the various ways that Uber and Google differ culturally. (Fallows was hired away from Google late last year. He’d previously spent five years with the search giant, developing, among other things, the Google Express delivery service.)

    Fallows couldn’t answer questions about Uber’s funding situation or its reported bid on Nokia’s mapping business, but he was refreshingly forthcoming when answering others. Our chat, edited for length, follows.

    Explain what you do.

    Obviously, we have the mainline business of offering transportation to people; [my job is largely looking into] how do we expand into new opportunities.  Uber for Business is one of my projects, for example, and that’s just building an enterprise version of Uber so that companies large and small can use it for their business travel.

    Is that taking up the majority of your time? How many initiatives are you working on at any one time?

    It is taking up the majority of my time. I have six different teams that are working on new projects all the time, and in a healthy ecosystem way, projects that aren’t working get wound down or swallowed up and resources [are] diverted.

    Can you point to something that’s been shut down recently?

    Nothing since I’ve been [at Uber]. But I remember while at Google, reading about Uber testing a concept [to deliver common convenience store items to select customers through a pilot project] in Washington, D.C that no longer exists.

    What can you tell us about how some others of its initiatives — including delivering food and packages — are doing?

    I can’t discuss any numbers, but as the press has reported, the Uber Eats [food delivery] product has expanded into several more cities and I think the market has been pretty strong. We’re doing well with Uber Rush, which is a [bike] courier service [that Uber rolled out in New York a year ago].

    What do you make of the argument that not everyone wants Uber to deliver both their food and their transportation — that people want different relationships with different brands?

    I don’t think consumers inherently care about how their item is getting to them so long as it’s getting to them effectively and quickly.

    You founded Google Express. The service has been portrayed in the press as troubled recently, including because the head of Google’s commerce businesses, Sameer Samat, has left to join Jawbone as president. Is that fair?

    I can’t speak to recent stuff, but when I left five months or so ago, but it was doing well. I think it’s the wrong conclusion to draw that [Samat’s departure] is a reflection on the commerce business. It’s a big driver of growth, and a big driver of profitability [at Google]. I don’t know anything but I suspect this was a poaching situation.

    The problem we had at Google Express was that we didn’t have enough capacity. Like every single delivery and on-demand service out there, we had such product-market fit that we just couldn’t keep up with demand. At Uber, that causes surge pricing. At Shopping Express, that caused sellouts, and that was always the pain point that we were dealing with.

    Can you confirm that Uber is currently raising $2 billion more from investors at a $50 billion valuation?

    I read about it as you guys did [in the audience]. I have no idea.

    If the company were to raise $2 billion, what would its top priorities be?  Expanding domestically? Competing more aggressively in India and China?

    I don’t in any way tie this to a fundraising. I literally don’t know anything about it and don’t know if or why we need more money, but the company had said in the last funding round that there are big global opportunities that we’re going after, and in our type of business, for anybody building liquidity and network effect and going into new markets, it can be very expensive.

    India and China are obviously big battlegrounds. How do you compete with regional taxi app companies that have something like 99 percent of the market?

    China and India are huge potential markets and places where we really want to participate  and where we think we can offer great service. [And] although the alternatives in China are very big, the majority of the business is in the taxi ride hailing, which isn’t a business, it’s purely a matchmaking business. They take no fee whatsoever. They have, similar to us, black car and Uber X [type] businesses, but they aren’t nearly as big, so it’s not . . . an open-and-shut case.

    One thing that’s interesting: The transportation business is truly, inherently local. At Google, of course, we could do localization, and we had sales teams in each country, but we didn’t have tech teams or custom features in that many countries, whereas at Uber, you really have to serve every single city independently — even within the U.S. We consider it a strategic advantage, our ability to operationalize at scale the management of these locations that need custom technology and custom solutions.

    What are some other differences between these two powerful companies? We know you joined Uber just five months ago, but are there early impressions you can share?

    Well, the first, strange [observation I made] when I walked into Uber was that one out of three people is a former Google colleague. There are also lots of people from Facebook.  Top to bottom at Uber, it’s [top-notch employees].

    The biggest difference at Uber is that, at heart, it’s still very much a startup with an action bias. In my first couple of weeks, we’d be talking about a new feature and inevitably in that conversation, the question would arise: How long would this take to get out? And someone would say, “I think it’ll be two to three . . .” And in my head, I’d just default, think weeks. And they’d finish, “…days.” And I think, what? [Laughs.]

    It’s a combination of a couple things. It’s much younger technology stack. Also, we’ve all had that experience where something needs change and you just change it and 12 minutes later it’s in the world, and Uber is still on that continuum versus my experience at Google, which, I absolutely love the people and I have nothing but great things to say about it, but it’s not necessarily known for its nimbleness and speed. One of the challenges I had with Google Express was how do we launch and iterate in an environment where you have multi-week review cycles, and all for good reason. Everything had a justification behind it. It’s all part of being a big company. But it’s inherently slower.

    You get the feeling that nearly everything trickles up to Larry Page at Google. At Uber, whose sign-off do you need?

    Very explicitly, the rule inside is: nobody needs to sign off.

    (For more of our interview with Fallows, click here.)

    —–

    New Fundings

    Abcodia, a 4.5-year-old, U.K.-based biotech company that has developed an ovarian cancer screening test that it plans to bring to market this summer, has raised $8.2 million in new funding co-led by Cambridge Innovation Capital and Scottish Equity Partners, with participation from earlier backers Albion Ventures and UCL Business.AllSeated, a four-year-old, New York-based maker of event planning and collaboration tools, has raised an undisclosed amount of funding from Magma Venture Partners.

    Aliada, a 10-month-old, Mexico City, Mexico-based marketplace that pairs consumers with housekeeping services, has raised $800,000 in seed funding from regional investment firms Capital Invent, Variv Capital, and Dila Capital. TechCrunch has more here.

    Cyber adAPT, a year-old, Half Moon Bay, Ca.-based real-time network-based threat detection platform, has raised $4.1 million in Series A funding from Alvin Fund, Granite Point Capital Partners, Griffin Fund II, and Fundamental Capital Management.Decorist, a 2.5-year-old, San Francisco-based online platform that’s aiming to make interior design personal, affordable and easier, has raised $4.5 million in funding from Lowe’s Companies, the Women’s Venture Capital Fund and other angel investors.

    Drizly, a three-year-old, Boston-based on-demand alcohol delivery company, has raised $13 million in Series A funding led by Polaris Partners, with participation from First Beverage Group and previous backers, including Suffolk Equity Partners. The company has now raised $17.8 million altogether.

    EasyStack, year-old, Beijing, China-based OpenStack startup, has raised $16 million in Series B funding led by RuShan Capital, with participation fromYingDong and earlier backer BlueRun Ventures. The company has raised $18 million to date.

    Kapost,  a five-year-old, Boulder, Co.-based content marketing software company, has raised $10.25 million from investors, including Access Venture Partners, Cue Ball Capital, Iron Gate Capital and Salesforce Ventures, as well as earlier backers Lead Edge Capital and High Country Ventures. The company has now raised at least $18.45 million altogether.

    Mediabong, a four-year-old, Paris, France-based video syndication network, has raised $5 million in Series B funding from Entrepreneur Venture and Conegliano Venture, among others. The company has now raised $6.3 million altogether, shows Crunchbase.

    Omada, a 16-year-old, Copenhagen, Denmark-based maker of compliance management software, has raised $24 million in growth equity funding from C5 Capital, a year-old, London-based firm.

    Oyo Rooms, a 2.5-year-old, Bangalore, India-based chain of tech-driven, standardized hotels, is reportedly talking with Softbank about selling a 25 percent to 30 percent stake in its business for $100 million. According to Crunchbase, the company has thus far raised $25.7 million from investors, including Lightspeed Venture Partners, Sequoia Capital, and Greenoaks Capital Management. Times of India has the story.

    Rovop, a nearly four-year-old, Westhill, U.K.-based company that makes tethered, unmanned underwater vehicles used by the offshore oil and gas and renewables industries to carry out a wide range of tasks, has raised £10m ($15.7 million) in funding from the Business Growth Fund.

    ScaleFT, a months-old, San Francisc-based platform for cloud administration and security, has raised $800,000 in seed funding from Rackspace and numerous angel investors. More here.

    Telogis, a 14-year-old, Aliso Viejo, Ca.-based maker of fleet management software, has raised $25 million in new funding, according to an SEC filingflagged by Fortune. According to Crunchbase, the company had previously raised $95 million, including from Fontinalis Partners and Kleiner Perkins Caufield & Byers.

    Tissue Analytics, a year-old, Baltimore-based wound imaging and telehealth company, has raised $750,000 in seed funding led by the Chinese Internet giantTencent Holdings. TechCrunch has more here.

    Taboola, an eight-year-old, New York-based content recommendation startup, has raised an undisclosed amount of “multi-millions” of dollars from Baidu, just three months after Taboola raised $117 million in Series E funding at a  reported valuation of $1 billion. More here.

    TrucksFirst, a 10-month-old, Gurgaon, India-based based logistic service provider focused on improving the efficiencies of long-haul trucking in the country, has raised $10 million in Series A  funding from SAIF Partners, with participation from Singapore Post and McKinsey & Co’s Germany-based travel director Thomas Netzer. (TrucksFirst founder Deepak Garg previously spent more than eight years with McKinsey.) Tech-Portal has more here.YCharts, a 5.5-year-old, Chicago and NYC-based financial software company that provides investment research tools, has raised $6 million in Series C funding led by Morningstar, with participation from Reed Elsevier, I2A,Amicus Capital Partners, Hyde Park Angels and other individuals. The company has now raised $14.5 million altogether.

    —–

    New Funds

    Draper Nexus Ventures, a U.S.-Japan cross-border investment firm with offices in San Mateo, Ca., and Tokyo, Japan, has raised $80.3 million for its newest fund, according to an SEC filing that shows a $125 million target. The firm officially kicked off fundraising last September.

    Insight Venture Partners, the New York-based growth-stage venture capital and private equity firm, is nearing the close of a pair of funds totaling more than $4 billion, reports VentureWire. Insight Venture Partners IX LP fund has gathered $2.9 billion in commitments, according to a document distributed to investors and viewed by VentureWire. The other fund, Insight Venture Partners Growth-Buyout Coinvestment Fund LP, has reportedly raised about $1.1 billion so far.

    Mbloom, a Maui, Hawaii-based venture capital firm focused on startups in Maui and throughout the state, has raised $10 million from a private investor in China, bringing the fund to a total of $20 million, reports Pacific Business News. The fund held a first close on the fund in January 2014 with $5 million raised from Hawaii Strategic Development Corp. and $5 million from an undisclosed private investor.

    —–

    Exits

    Coherent Navigation, a seven-year-old, San Mateo, Ca.-based navigation company, has been acquired by Apple, the company confirmed yesterday. Terms of the deal were not disclosed but are expected to bolster Apple’s mapping technology and services. According to the LinkedIn page of Coherent’s CEO, Paul Lego, the acquisition took place five months ago. MacRumors has the story here.

    Miaxis Biometrics, a 15-year-old, Hangzhou, China-based developer of biometric software, has been acquired for $40.6 million by the point-of-sale terminal and e-payment solutions provider Xinguodu Technology, reports Reuters.

    StrikeAd, a five-year-old, New York-based advertising demand side platform (DSP), has been acquired by the publicly traded ad management platform company Sizmek for undisclosed terms. According to Crunchbase, StrikeAd had raised at least $7 million from investors in a Series A round that included Wavemaker Partners, Canyon Creek Capital, SoftTech VC, and DFJ Esprit.

    —–

    People< Fan Bao, founder of 11-year-old investment bank China Renaissance, has been involved in some of the country’s biggest IPOs and mergers. Now, his bank is scouring China’s startup scene to uncover a new wave of technology giants. Bloomberg profiles him here.

    Seven employees quit payment rewards startup Clinkle simultaneously Friday, reporting owing to frustration with its 24-year-old CEO Lucas Duplan. Indeed, says TechCrunch, the remaining team is “now believed to be less than a dozen, down from 70 several years ago.” The four-year-old company has raised $30 million in funding from investors, including a $25 million round that was boldly advertised at the time as the “largest seed round in Silicon Valley history.”

    Longtime LP and now Hamilton College CIO Anne Dinneen on how LPs evaluate venture partnerships.

    John and Ann Doerr — both of whom hold bachelor’s and master’s degrees in electrical engineering from Rice University — have donated $50 million to the school to create a leadership institute called the Doerr Institute for New Leaders. The couple has previously donated $15 million to the Rice Center for Engineering Leadership; their newest gift is the largest in the school’s history.

    San Francisco attorney Christopher Dolan has agreed to represent a client who says Uber stole his business idea. The evidence is thin, though, and the lawsuit a big gamble for Dolan’s firm, observes The Recorder.

    Veterans of Google‘s PR team — including Elliot Schrage,Anne Espiritu, and Rachel Whetstone — now run communications at many of Silicon Valley’s most prominent companies. Forbes takes a looks at what’s become the “farm team for the Valley’s spin machine.”Eric Nuzum, the former vice president of programming for NPR, has joined Amazon-owned Audible.com as it looks to move further into the world of podcasting, reports GeekWire. Nuzum — who developed some of NPR’s biggest shows, including “Wait, Wait, Don’t Tell Me” —  is joining as senior vice president of original content.

    On Friday, Snapchat CEO Evan Spiegel delivered a commencement address at USC’s Marshall School of Business. Among the many pointers he offered the school’s graduates: “You are going to make a lot of mistakes. I’ve already made a ton of them — some of them very publicly — and it will feel terrible, but it will be okay. Just apologize as quickly as you can and pray for forgiveness.” His full commencement speech is here.

    —–

    Jobs

    Yale is seeking academically inclined founders and investors to teach entrepreneurship on the faculty at Yale SOM. There are two openings.

    ——

    Data

    Sales on e-commerce websites increased 3.5 percent in the first three months of the year from the previous quarter, reaching a record $80 billion worth of purchases, according to Commerce Department figures released Friday and covered by Bloomberg. Year over year, online purchases were up 14.5 percent. Somewhat amazingly, the share of e-commerce as a percent of total retail sales is still just 7 percent, up from 0.6 percent in 1999.

    —–

    Essential Reads

    Axact calls itself Pakistan’s largest software exporter. The New York Times calls it a “fake education empire,” that’s “obscured by proxy Internet services, combative legal tactics and a chronic lack of regulation in Pakistan.”

    —–

    Detours

    David Letterman, revolutionary.

    —–

    Retail Therapy

    The Chewbacca hoodie. [Takes helmet by the brim, holds it in the air.]

    Connie

    ,

  • Uber Exec Tom Fallows on the Company’s Culture, and More

    Tom FallowsAt a StrictlyVC event in San Francisco last week, Tom Fallows, Director of Global Expansion Products at Uber, talked with us about what’s important to Uber right now, why Uber sees the fight for India and China as far from over, and the various ways that Uber and Google differ culturally. (Fallows was hired away from Google late last year. He’d previously spent five years with the search giant, developing, among other things, the Google Express delivery service.)

    Fallows couldn’t answer questions about Uber’s funding situation or its reported bid on Nokia’s mapping business, but he was refreshingly forthcoming when answering others. Our chat, edited for length, follows.

    Explain what you do.

    Obviously, we have the mainline business of offering transportation to people; [my job is largely looking into] how do we expand into new opportunities.  Uber for Business is one of my projects, for example, and that’s just building an enterprise version of Uber so that companies large and small can use it for their business travel.

    Is that taking up the majority of your time? How many initiatives are you working on at any one time?

    It is taking up the majority of my time. I have six different teams that are working on new projects all the time, and in a healthy ecosystem way, projects that aren’t working get wound down or swallowed up and resources [are] diverted.

    Can you point to something that’s been shut down recently?

    Nothing since I’ve been [at Uber]. But I remember while at Google, reading about Uber testing a concept [to deliver common convenience store items to select customers through a pilot project] in Washington, D.C that no longer exists.

    What can you tell us about how some others of its initiatives — including delivering food and packages — are doing?

    I can’t discuss any numbers, but as the press has reported, the Uber Eats [food delivery] product has expanded into several more cities and I think the market has been pretty strong. We’re doing well with Uber Rush, which is a [bike] courier service [that Uber rolled out in New York a year ago].

    What do you make of the argument that not everyone wants Uber to deliver both their food and their transportation — that people want different relationships with different brands?

    I don’t think consumers inherently care about how their item is getting to them so long as it’s getting to them effectively and quickly.

    You founded Google Express. The service has been portrayed in the press as troubled recently, including because the head of Google’s commerce businesses, Sameer Samat, has left to join Jawbone as president. Is that fair?

    I can’t speak to recent stuff, but when I left five months or so ago, but it was doing well. I think it’s the wrong conclusion to draw that [Samat’s departure] is a reflection on the commerce business. It’s a big driver of growth, and a big driver of profitability [at Google]. I don’t know anything but I suspect this was a poaching situation.

    The problem we had at Google Express was that we didn’t have enough capacity. Like every single delivery and on-demand service out there, we had such product-market fit that we just couldn’t keep up with demand. At Uber, that causes surge pricing. At Shopping Express, that caused sellouts, and that was always the pain point that we were dealing with.

    Can you confirm that Uber is currently raising $2 billion more from investors at a $50 billion valuation?

    I read about it as you guys did [in the audience]. I have no idea.

    If the company were to raise $2 billion, what would its top priorities be?  Expanding domestically? Competing more aggressively in India and China?

    I don’t in any way tie this to a fundraising. I literally don’t know anything about it and don’t know if or why we need more money, but the company had said in the last funding round that there are big global opportunities that we’re going after, and in our type of business, for anybody building liquidity and network effect and going into new markets, it can be very expensive.

    India and China are obviously big battlegrounds. How do you compete with regional taxi app companies that have something like 99 percent of the market?

    China and India are huge potential markets and places where we really want to participate  and where we think we can offer great service. [And] although the alternatives in China are very big, the majority of the business is in the taxi ride hailing, which isn’t a business, it’s purely a matchmaking business. They take no fee whatsoever. They have, similar to us, black car and Uber X [type] businesses, but they aren’t nearly as big, so it’s not . . . an open-and-shut case.

    One thing that’s interesting: The transportation business is truly, inherently local. At Google, of course, we could do localization, and we had sales teams in each country, but we didn’t have tech teams or custom features in that many countries, whereas at Uber, you really have to serve every single city independently — even within the U.S. We consider it a strategic advantage, our ability to operationalize at scale the management of these locations that need custom technology and custom solutions.

    What are some other differences between these two powerful companies? We know you joined Uber just five months ago, but are there early impressions you can share?

    Well, the first, strange [observation I made] when I walked into Uber was that one out of three people is a former Google colleague. There are also lots of people from Facebook.  Top to bottom at Uber, it’s [top-notch employees].

    The biggest difference at Uber is that, at heart, it’s still very much a startup with an action bias. In my first couple of weeks, we’d be talking about a new feature and inevitably in that conversation, the question would arise: How long would this take to get out? And someone would say, “I think it’ll be two to three . . .” And in my head, I’d just default, think weeks. And they’d finish, “…days.” And I think, what? [Laughs.]

    It’s a combination of a couple things. It’s much younger technology stack. Also, we’ve all had that experience where something needs change and you just change it and 12 minutes later it’s in the world, and Uber is still on that continuum versus my experience at Google, which, I absolutely love the people and I have nothing but great things to say about it, but it’s not necessarily known for its nimbleness and speed. One of the challenges I had with Google Express was how do we launch and iterate in an environment where you have multi-week review cycles, and all for good reason. Everything had a justification behind it. It’s all part of being a big company. But it’s inherently slower.

    You get the feeling that nearly everything trickles up to Larry Page at Google. At Uber, whose sign-off do you need?

    Very explicitly, the rule inside is: nobody needs to sign off. As a product manager, I’m an owner of my products and it’s my right and responsibility to launch things when I think they’re ready to launch and to be accountable for those consequences. It’s a very intentional, constructive environment, and it’s a bet, and you get mostly great outcomes in terms of speed. And sometimes you stumble because, well, safety checks are put in place for good reasons at good companies.

    So we’re still wonderfully on the side that it’s small enough and people subscribe to this ownership mentality of: I’m going to build, I’m going to launch, but I’m also going to sweat the details and whether it’s something silly like a typo or a weird experience or, meta like a privacy issue, I’m going to be really sure I don’t do that.

    Months after you left Google, Bloomberg reported that Google – an Uber investor – is developing its own self-driving app. Soon after, Google said, “It’s no big deal, it’s just this internal project.” Can you tell us what’s really going on?

    Uh, no. [Laughs.] Google is working on everything so I think probably all sides are true. I know a bunch of folks there . . . so there’s nothing particular I want to comment on . . .

    What about the news that Uber is bidding on Here to get away from its reliance on Google Maps? Is that happening and, either way, does it want to rely less on Google Maps?

    I read about that, too, and I don’t know. I think, macro, as Amazon has progressively moved toward owing its fulfillment centers and even now last-mile delivery, any company in the world strategically wants to ensure that the things that are important to them they somehow they control — whether via a strategic investment, partnerships, or building [their own products]. And there are a number of ways to achieve [that end]. I don’t know anything, but I wasn’t shocked to read that.

    Looking forward, what will Uber look like? This week it was flying people to Cannes in leased helicopters. Will it eventually be leasing planes? Will we see it get into the shipping business? What might surprise people about its roadmap?

    Whether it’s employing helicopters or delivering candy, those are mostly wonderful marketing stunts to get buzz going rather than [future lines of business]. So the short answer is probably no to those things. But, I think, goodness knows.

    Connie

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  • StrictlyVC: May 15, 2015

    Hi, everyone! No column today. (Sorry to make it two days in a row but we were in meetings most of yesterday.)

    We do have newly posted pictures from our event this past Wednesday night; We also have lots of great content coming your way next week.

    Hope you have a terrific weekend.:)

    ——

    Top News in the A.M.

    This fight isn’t over yet. Lyft, the three-year-old, San Francisco-based ridesharing startup, has raised $100 million in new funding from Carl Icahn’s Icahn Enterprises. The investment is an extension of a round of funding announced in March that values Lyft at $2.5 billion. “If you look at the way the market evaluates Uber and then look at the valuation of Lyft—Lyft is a tremendous bargain,” Icahn tells the WSJ. “There is room for two.” Lyft, notes the WSJ, has raised a total of more than $1 billion in its battle against Uber, which has raised more than $5 billion.

    Watch out: Google’s self-driving cars hit the road this summer.

    —–

    New Fundings

    Alpha7, a year-old, Singapore-based technology consultancy, has raised $2.3 million in new funding from undisclosed backers. The company has now raised $3.6 million to date.

    Denali Therapeutics, a new, San Francisco-based biotech focused on treating and curing neurodegenerative diseases like Alzheimer’s, ALS and Parkinson’s, has raised $217 million in funding from Fidelity Biosciences, ARCH Venture Partners, Flagship Ventures, and the Alaska Permanent Fund, with participation from sovereign wealth funds, mutual funds, and private family offices. Denali was founded by three former top researchers at Genentech. Forbes has much more here.

    Geekie, a four-year-old, São Paulo, Brazil-based adaptive learning platform designed to help students gain acceptance into public universities, has raised $7 million in funding from Mitsui & Co. and Omidyar Network, as well as previous backers Gera Venture and Virtuose.

    Intact Vascular, a three-year-old, Wayne, Pa.-based company that makes medical devices for minimally invasive peripheral vascular procedures, has raised $38.9 million in Series B funding led by New Enterprise Associates, with participation from Quaker Partners, H.I.G. Bioventures and earlier investors.

    LeTV Sports, a new, Beijing, China-based online video site that focuses on live streaming sports events, (it’s a spin-off from online video firm LeShi Internet Information, which handles broadcast and media rights to hundreds of events in a dozen sports categories), has raised $128 million in Series A funding led by Alibaba founder Jack Ma and Wanda Group chairman Wang Jianin. Reports say the company is now valued at $452 million.

    IndianRoots.com, a two-year-old, Gurgaon, India-based e-commerce platform that features hundreds of designer brands, has raised $5 million in Series B funding at an $85 million valuation led by KJS Group. Inc42 has more here.

    Officevibe, a five-month-old, Montreal, Canada-based maker of employee engagement software, has raised $1 million in seed funding from GSoft Ventures.

    RealMassive, a two-year-old, Austin, Tex.-based cloud-based platform used by real estate agents looking to collaborate and to streamline their marketing efforts, has raised $8 million in funding led by RHS Investments, with participation from Hurt Family Investments, Capital Factory, HPI Real Estate Services, Aquila Commercial, Avison Young and InSite Realty. The company has now raised roughly $14 million, shows Crunchbase.

    Wonolo, a two-year-old, San Francisco-based on-demand staffing platform for businesses to fill their immediate hourly or daily labor needs, has raised $2.2 million in seed funding led by PivotNorth Capital, with participation from CrunchFund, Foundry Group, and angel investors. Coca-Cola also provided a convertible note of $1 million and has provided another note of $700,000 that will convert on the next round. Venture Capital Dispatch has more here.

    —–

    New Funds

    Collaborative Fund, a five-year-old, New York-based seed investment firm that’s focused on so-called collaborative consumption models, has raised $65 million for its third fund. Among its many bets to date: Hampton Creek,Earnest, and Kano Computing. Collaborative’s LPs include the San Francisco-based fund of funds Cendana Capital. Last July, Collaborative founder Craig Shapiro also rolled out a special purpose entity called Alignment Holdingsthat works with later-stage companies. We’d talked with him about it here.

    —–

    People<

    Bank of America Merrill Lynch is forming a new team called the Strategic & Private Capital Solutions Group to raise money for private companies, reports the WSJ. Bankers Sachin Aggarwal and Warren Fixmer will run the group.
    —–

    Jobs

    UC Davis is looking for an associate director to act as a liaison between investors and the school’s research, technology transfer and new venture development departments. The job is in Davis, Ca.

    —–

    Essential Reads

    Decoding the enigma of Satoshi Nakamoto.

    Coca Cola wants to fund the next billion-dollar startup, too.

    “Living” concrete that can heal itself.

    —–

    Detours

    A pilot’s-eye view of life in the sky.

    Playground purgatory.

    Real people, fake arms.

    —–

    Retail Therapy

    The Lily camera; just throw and go.

    Connie

  • StrictlyVC: May 14, 2015

    Hi, happy Thursday, everyone. Thanks so much to the many of you who came out to our San Francisco event last night! We loved seeing you. Thanks again to our terrific guest speakers Jeremy Liew, Dan Morehead, Bryan Schreier, Marco Zappacosta, Semil Shah, Charles Hudson, and Tom Fallows. Thanks, too, to sponsors Galvanize, Personal Capital, and Amazon Web Services for their generous help in putting the evening together.

    We’ll be publishing stories and photos from the event in coming days. In the meantime, no column today. We’re still a little foggy this a.m.:)

    —–

    Top News in the A.M.

    PayPal will list on Nasdaq after spinning off from parent eBay, the company announced this morning. Its ticker, PYPL, is the same ticker it used before being acquired by eBay 13 years ago.

    —–

    New Fundings

    Actiance, a 17-year-old, Redwood City, Ca.-based company that makes compliance, security, archiving and eDiscovery software for critical business communications, has raised $28 million in growth funding from Golub Capital, along with earlier backers Credit Suisse NEXT Investors, JK&B Capital, Scale Venture Partners and Sutter Hill Ventures.

    A.I. Nemo, a Chinese startup that produces what it calls a “robot companion” for homes, has reportedly raised more than $10 million in Series B funding from undisclosed investors. The companies earlier backers include Innovation Works and Lightspeed China Partners. More here.

    Ahalogy, a 2.5-year-old, Cincinnati, Oh.-based Pinterest-focused marketing company, has raised $8 million in equity and debt from JobsOhio and Silicon Valley Bank. The company had previously raised $4.8 million from CincyTech, Hyde Park Angels and others, shows Crunchbase.

    Explain Everything, a five-year-old, New York-based maker of an interactive screencasting whiteboard, has raised $2 million in Series A funding led by Credo Ventures, with participation from New Europe Ventures and RTAventures. More here.

    Face++, a 3.5-year-old, Beijing, China-based face recognition tech startup, has added $25 million to an earlier Series B financing, bringing the total round to $47 million. Participants in the round include Innovation Works and Ignition Partners. Tech in Asia has more here.

    Gametime United, a 2.5-year-old, San Francisco-based company whose mobile app sells last-minute tickets to sporting events, has raised $13 million in Series A funding led by Accel Partners, with participation from tech, media and sports executives, Box CEO Aaron Levie and one-time Yahoo president Jeff Mallett. Venture Capital Dispatch has more here.

    Jumpshot, a nearly five-year-old, San Francisco-based marketing analytics platform, has raised $22 million in Series A funding led by Avast Software.

    MDSave, a three-year-old, Brentwood, Tn.-based online health marketplace for cash-paying customers, has raised $12 million in funding from earlier investor MTS Health Investors. The company has now raised $19.4 million altogether, shows Crunchbase.

    Mnubo, a three-year-old, Montreal, Quebec-based data analytics startup, has raised $6 million in new funding led by White Star Capital, with participation from McRock Capital. The company had previously raised an undisclosed amount of seed funding.

    Myomo, an 11-year-old, Cambridge, Ma.-based maker of myoelectric orthotics for people with neurological disorders, has raised $5 million in Series B-1 funding led by Mountain Group Capital. The company has now raised $12.6 million altogether, shows Crunchbase.

    Neumob, 1.5-year-old, Sunnyvale, Ca.-based company that promises to speed up users’ apps, has raised a $2.3 million in seed funding from a long list of investors, including Accel Partners, Lightbank, Menlo Ventures, Plug and Play Ventures, Shasta Ventures.

    NuSirt Biopharma, an eight-year-old, Nashville, Tn.-based developer of therapeutics for people with chronic metabolic diseases, has raised $6 million in Series C funding from Hatteras Venture Partners, Mountain Group Partners and TriStar Technology Ventures.

    Paidy, a Tokyo, Japan-based cardless e-commerce payment and instant credit service from the non-bank lender Exchange Corporation, has closed its Series A with $8.3 million, including from Arbor Ventures, SIG Asia and MS Capital.

    Percolate, a four-year-old, New York-based platform for enterprise marketing management, has raised $40 million in Series C funding led by Lightspeed Venture Partners, with participation from earlier investors Sequoia Capital, GGV Capital, First Round Capital and Lerer Hippeau Ventures.

    Pipedrive, a nearly five-year-old, Menlo Park, Ca.-based maker of sales pipeline management software, has raised $9 million in Series A funding led by Bessemer Venture Partners, with participation from Paua Ventures and earlier investors Rembrandt Venture Partners and AngelPad. TechCrunch has more here.

    Plancess EduSolutions, a months-old, Mumbai, India-based test preparation platform, has raised $2 million in funding. More here.

    PlanGrid, a 3.5-year-old, San Francisco-based company that makes productivity software for the construction industry, has raised $18 million in Series A funding led by Sequoia Capital, with participation from investor Ron Conway, and Yammer founder David Sachs. Fortune has the story here.

    Silversheet, a year-old, L.A.-based healthcare administration software platform that tackles physician credentialing, has raised $2.9 million in seed funding led by Upfront Ventures, with participation from BAM Ventures, Rincon Venture Partners, SV Angel, Slow Ventures, and Cyan and Scott Banister.

    Slyce, a 3.5-year-old, Toronto, Canada-based visual product search platform, has raised $8.7 million in funding led by Salman Partners and Beacon Securities, with PI Financial participating. The round brings the company’s funding to more than $36 million.

    Vouch, a nearly 2.5-year-old, San Francisco-based social lending startup that loans customers money based on who and how may people “vouch” for that person, has raised $6 million in funding from Core Innovation Capital, Data Collective, Stanford StartX Fund and Cooley. The company has now raised $9.6 million altogether, including from First Round Capital, Greylock Partners, IDG Ventures, and AngelList.

    —–

    New Funds

    Aspect Venture Partners, the VC firm formed last year by former DFJ partnerJennifer Fonstat and former Accel Partners managing director Theresia Gouw, has closed its debut fund with $150 million in capital commitments,reports Fortune.

    Redpoint Ventures, the 15-year-old, Sand Hill Road venture firm, has closed its sixth fund with $400 million (the same size as its predecessor), it announced in a blog post yesterday. More here.

    A new £300 million U.K. fund has been set up to support high tech startups looking to spin out of the University of Oxford. TechCrunch has more here.

    —–

    Exits

    McKinsey & Co.,  the management consulting giant, is buying Lunar, the design consulting giant, for undisclosed terms. Wired explains why.

    Samsung paid about $250 million earlier this year to acquire LoopPay, a startup whose technology will be used in the Samsung Pay mobile payments system when it launches later this year. LoopPay had raised more than $10 million from investors, including Visa. Recode has the news here.

    —–

    People

    Longtime VC Ifty Ahmed, who was accused by the SEC of insider trading, is now being accused of fraud by the SEC. Ahmed, an investor at Oak Investment Partners, allegedly transferred $27.5 million to accounts under his control “at the expense of investors in the Oak funds, including public pension investors,” according to the SEC. Oak provided the SEC with materials that led to this new, separate case against Ahmed, says Fortune. According to its report, Oak has also (unsurprisingly) fired Ahmed, who spent nearly a dozen years with the firm. Earlier in his career, Ahmed had worked as an associate at Goldman Sachs. He also spent several years as a senior associate with Fidelity Ventures.

    Jérémie Berrebi is leaving five-year-old, Paris-based Kima Ventures, a fund he co-founded with French telco and media entrepreneur Xavier Niel in 2010.  Berrebi tells TechCrunch he plans to focus instead on building new startups, the first of which is a real-estate investment platform called RoundVIP.com. He’ll also be doing some later-stage investing.

    Rachel Whetstone, the longtime head of Google’s public policy and communications unit, is taking on a similar job at Uber as SVP of policy and communications, reports Recode. She replaces former political advisor David Plouffe, who will become a chief adviser to the company as well as a board member. Whetstone is one of a long list of ex-Google execs to join Uber. (StrictlyVC interviewed another, Tom Fallows, last night at our San Francisco event. More on that chat to come.)

    Nick Woodman, GoPro‘s billionaire CEO, is $229 million dollars poorer after returning 4.7 million shares to the company this week, reports Bloomberg. The shares as part of an agreement he struck with the company for stock options that were granted to his college roommate Neil Dana, who attended the University of California at San Diego with Woodman, who was GoPro’s first employee, and remains GoPro’s director of music and specialty sales. Dana reportedly spent $3.6 million to exercise his options; they were valued at $229 million at the close of trading on Monday.

    —–

    Data

    According to CB Insights, investment activity in on-demand mobile services rose 514 percent year-over-year to hit $4.1 billion in 2014. And a spate of huge rounds in recent months has funding on track to double that amount in 2015. You can check out the full report here.

    The overarching ed-tech investment trend of 2015: More money, fewer deals. EdSurge has more here.

    —–

    Essential Reads

    Elon Musk’s space dream almost killed Tesla.

    How Facebook’s new experiment changes the news — and how it doesn’t.

    —–

    Detours

    The most popular baby name in every state.

    Your smartphone codependence, quantified.

    —–

    Retail Therapy

    The $65 million mansion atop Aspen’s “Billionaire Mountain.”

    Connie

  • StrictlyVC: May 13, 2015

    Happy Wednesday, everyone! Looking forward to seeing some of you tonight!

    —–

    Top News in the A.M.

    A security research firm is warning that a new bug could allow a hacker to take over vast portions of a datacenter — from within.

    Apple and A123 are about to settle their lawsuit over poached battery engineers.

    —–

    The Muse Raises $10 Million (and Turns Away $10 Million)

    The Muse, a 3.5-year-old New York-based career site that offers job opportunities, advice, skill-building courses, and video profiles meant to show what it’s like to work at different companies, has just raised $10 million in Series A funding from Aspect Ventures, DBL Partners and QED Investors.

    Co-founder and CEO Kathryn Minshew says the platform, which is largely used by millennials – 65 percent of them women and more than 50 percent nonwhite — could easily have raised $20 million.

    We talked yesterday about the fast-growing, 33-person company — and what happened out on the fundraising trail. Our chat has been edited for length.

    You founded the Muse with two other women, Alex Cavoulacos and Melissa McCreery. How did you come together?<

    We met while working at McKinsey, during my first first week on the job in the fall of 2008. Lehman had just fallen. There was a lot of upheaval. Even though McKinsey was a great educational experience, I realized I didn’t want to be a consultant. The three of us kept talking about what it would be like if you could get advice on your career and see inside companies before applying and we finally thought: maybe we should just start [our own career site].

    You say it’s taken off like gangbusters.

    It started off as a very basic content career site in September 2011, but we’d attracted 70,000 people to it in the third month. It wasn’t impressive looking, but based on that user growth, Y Combinator accepted us into its winter program and by the following summer, we had 100,000 people on the site each month. Now, 3.5 million people are visiting each month.

    Most are millennials. Our average user is 29, compared with LinkedIn, whose average user is 47. Sixty-five percent of our users are female, compared with LinkedIn, whose users are 55 percent male.

    Why is that?

    We think it’s partly because LinkedIn is more of a transactional networking tool; it isn’t a place where users feel like someone is looking out for their career.

    How is The Muse making money?

    The vast majority comes from recruiting; we now 300 companies listing jobs and corporate profiles on the site. Generally, companies are measuring their ROI by how may hires they’re making, how aware people are of their brands, and how many people engage with their materials, which we put together in part by sending a videographer into every company’s offices. We want users to see authentic, quality materials about what these workplaces are like. [Companies] just pay to sign up, and we take care of everything.

    What about content?

    We have a small amount of revenue that comes through content marketing. Our users are generally very willing to take our recommendations around career-related products and services, but we want to make sure anything sponsored is noted and that we don’t work with partners that we don’t think are relevant or up to our standards. Trust is an important part of our brand.

    What are some ways that you’re using all the data you’re collecting?

    We can tell that people who are interested in certain companies will probably like other types of companies that wouldn’t be obvious from the [mandate] and size of those companies. We can pull out when someone is open to looking for a job because what they’re clicking on and reading starts to change [and we can personalize the experience for them].

    The data is useful for employers, too. They want to be able to compare their recruiting efforts to other companies, so if they say, “We didn’t see as many applications for this role as we wanted to,” we can tell them, “We can see 1,000 people clicked on that role and 40 people applied. That conversion is substantially lower than your close competitor; maybe there’s something in the job description that isn’t communicating what you want it to.”

    How many markets is The Muse operating in currently?

    We’re actively serving jobs in eight markets right now, including New York, San Francisco, L.A., Chicago, D.C., and Boston.  But we’re launching soon in Atlanta, Austin, and Houston, and we get nice – and angry – requests from Portland, Raleigh-Durham and other places asking why we aren’t there yet, so we’re investing heavily in expanding the number of cities we serve.

    How was fundraising?

    Even though the market is very good right now, you never know how it’s going to receive your particular company. But it was fun – even a bit crazy. The market is a little insane. People were aggressively pushing us to do things that didn’t make sense. I had to go to a lot of people who I really like and who would probably be very valuable and useful and say, “We’re not going to raise $20 million.”
    —–

    New Fundings

    Atia Medical, a months-old, Campbell, Ca.-based stealth-mode company launched by the year-old medical technology incubator Shifamed, has raised $3 million in the first tranche of a $5 million Series B financing. The investment was made solely by Medvance Incubator Partners, an early-stage medtech venture fund formed by Shifamed and Delos Capital.

    Blue Apron, a three-year-old, New York-based startup that ships boxes of premeasured ingredients to home cooks, is talking with investors about a new round of more than $100 million that would value the company at roughly $2 billion, according to a WSJ report. The company has raised $58 million to date, including from First Round Capital, Bessemer Venture Partners, and BoxGroup.

    Buyapowa, a four-year-old, London-based social commerces sales platform that aims to turn fans into shopper advocates, has raised $3 million in Series A funding led by Juno Capital, with participation from Bright Station Ventures and several other European investors. The company has now raised $7.6 million to date, shows Crunchbase.

    Cryex, a two-year-old, Stockholm, Sweden-based bitcoin exchange, has raised $10 million in funding from numerous investors, including Northzone and White Star Capital. Coindesk has more here.

    DocPlanner, a three-year-old, Warsaw, Poland-based online booking platform for healthcare appointments, has raised $10 million in Series B financing led by the European Bank for Reconstruction and Development. Other participants in the round include earlier backers Point Nine Capital, Piton Capital and RTAventures, as well as individual investors, including Fabrice Grinda. To date, the company has raised $14 million, reports TechCrunch.

    eduK, a two-year-old, São Paulo, Brazil-based online education platform that teaches professional skills and is considered to be Brazil’s largest education startup, has raised $10 million in Series B funding led by Accel Partners, with participation from earlier investors Monashees Capital and Felicis Ventures. TechCrunch has more here.

    Flexport, a two-year-old, San Francisco-based global trade platform whose online dashboard lets companies check freight prices, book shipments, route cargo, manage inventory, and get notified of exceptions, has raised $6.6 million in seed funding from First Round Capital, Google Ventures, and Bloomberg Beta, among others. Bloomberg has more here.

    Instart Logic, a 4.5-year-old, Palo Alto, Ca.-based service that helps businesses speed up the delivery of their cloud applications, has raised $43 million in new funding led by Four Rivers Group and Hermes Growth Partners, with participation from earlier backers Andreessen Horowitz, Kleiner Perkins Caufield & Byers, and Tenaya Capital. The company has now raised $95 million to date.

    MathCrunch, a year-old, San Francisco-based mobile app that provides on-demand tutoring for students, has raised $3.5 million in seed funding from undisclosed investors. TechCrunch has more here.

    Smarking, a two-year-old, San Francisco startup that helps parking providers make sure their spaces are filled, has raised $3 million in seed funding led by Khosla Ventures, with participation from Slow Ventures, Procyon Ventures, SVS Ventures, FinSight Ventures, Fairstead Capital,CheerLand Investment, Pre-Angel, DN Capital and other angel investors. Venture Capital Dispatch has more here.

    VictorOps, a three-year-old, Boulder, Co.-based company whose technology helps software-as-a-service companies manage and remediate software system alerts and outages in real time, has raised $2.6 million in funding as part of a Series B round that remains open. Earlier backers Costanoa Venture Capital and Foundry Group are among other participants in the round. More here.

    Wallflower, a 1.5-year-old, Charleston, Ma.-based company that’s creating connected home technology that helps consumers prevent and reduce risks related to accidental fires caused by ranges, stoves and ovens, has raised $1.5 million in seed funding from Microsoft and other, undisclosed backers. More here.

    Winnow, a two-year-old, London-based company aiming to cut down on food waste in the hospitality industry through smart meters that let kitchen staff easily log what food is thrown away, has raised $900,000 in seed funding led by Mustard Seed, with participation from numerous other investors. More here.
    —–

    New Funds

    Michael Dearing, a former eBay executive who founded the seed-stage fund Harrison Metal Capital in 2006, announced on Twitter in the wee hours of this morning that he has just closed his fourth fund, Harrison Metal Capital IV, with $68 million in capital.

    Eucalyptus Growth Capital, a Tel Aviv, Israel-based firm that intends to invest in late-stage Israeli tech companies, is looking to raise $300 million for its debut fund, reports The Globes. Eucalyptus was founded by Dadi Perlmutter, Rami Hadar and Eldad Tamir. Perlmutter was formerly an EVP and general manager of the Intel Architecture Group (IAG), and chief product officer at Intel. Hadar is the former CEO of publicly traded Allot Communications. Tamir is the founder & CEO of the Tamir Fishman Group.

    ——-

    People

    According to a new book about Elon Musk, the serial entrepreneur is close to Google CEO Larry Page and the two sometimes meet to talk about technology, transportation, and more in a secret apartment owned by Page in downtown Palo Alto. More here.

    Venkat Panchapakesan, a Google VP who led engineering for YouTube, died Monday night, reports Recode. He was battling cancer. Panchapakesan spent over a decade at Yahoo, leaving in 2009. He joined Google the following year.

    —–

    Jobs

    Medtronic is looking for a senior program director, venture capital. The job can be in Boston or Minneapolis.

    —–

    Data

    Fully 90 percent of the rounds closed in the first quarter were up rounds —  a level not seen in more than six years, according to a new trends report published by Cooley. Its data also points to a decrease in median pre-money valuations in Series A and C transactions and, conversely, median pre-money valuations increasing in both Series B and D and later deals. More here.

    —–

    Essential Reads

    Facebook has just launched a new “Instant Articles” platform for nine publishers (to start). The move has those partners celebrating, while other media properties nervously wait and watch the experiment from afar.

    Google is moving its corporate applications to the Internet.

    AOL CEO Tim Armstrong denied yesterday that AOL is spinning off Huffington Post entirely, reports Business Insider. Yesterday, Recode reported that the media outlet might be sold as part of Verizon’s acquisition of AOL. But in an interview with HuffPo yesterday, Armstrong said AOL will always be an owner — if not the sole owner — of HuffPo.
    —–

    Detours

    Six charts that put the wealth of some tech execs into unique perspective.

    The 10 most expensive movie sets ever built.

    The other side of Cannes: Debauchery, danger and the dirty secrets aboard the super-rich’s superyachts.

    ——

    Retail Therapy

    Design your own duffel, with Hudson Sutler. (By the way, this is a seed-funded startup that’ll be looking for more funding next year.)

    Connie

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