Hi, good Monday morning, everyone! Hope you had a wonderful weekend. (Web visitors, here‘s an easier-to-read version of today’s morning email.)
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Top News in the A.M.
President Obama, who has long endorsed net neutrality, just asked the FCC to reclassify the Internet as a utility. Here’s his plan, released this morning.
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Sam Pullara on Being an Entrepreneur at a VC Firm
Sam Pullara has worn an awful lot of hats in his career. A staff engineer at WebLogic in the mid- to late- ’90s, Pullara went on to log time at BEA Systems [which acquired WebLogic, then sold to Oracle], Borland Software, and Yahoo, where over roughly three years, Pullara worked his way up to Chief Technologist. (He left a year later in 2010, as soon as his shares were vested.)
Pullara has also cofounded two companies and served as an entrepreneur-in-residence at both Accel Partners and Benchmark. In fact, it probably came as little surprise to those who know him when in 2012, Pullara, working as a senior infrastructure engineer for Twitter at the time, was invited to join Sutter Hill Ventures as a managing director. Last week, Pullara talked a bit with us about his latest adventure and how long he thinks he’ll stick around this time.
You’ve been a full-time VC for two years. Is the job what you expected?
It’s amazing. It is what I expected, which was a lot. It’s the last job I’ll have, which is surprising for me given my background, but the last two years have gone by super fast. Every day is interesting.
In addition to traditional things, like recruit for companies, Sutter Hill does what it calls origination. Can you explain to readers what that means?
The best example of what we do is Pure Storage, which my [Sutter Hill] partner Mike Speiser helped start when he was leaving Yahoo to come here. He worked with [founder and CTO] John Colgrove for eight months, trying to figure out the best company to start in flash storage. John started it and Mike joined as interim CEO as John built out the team. Then Aneel Bhusri of Greylock [Partners] did the Series B and the rest of that is going amazing. [Editor’s note: Pure Storage is now among the most richly funded companies in Silicon Valley, having raised $470 million since its 2009 founding.]
How is that model different from firms that help incubate companies?
Rarely do you see someone from [accelerator programs like] Y Combinator or Techstars join the [companies they help]. In fact, after Pure Storage, Mike went on to do another company that just came out of stealth, Snowflake Computing [a cloud data warehousing company that has so far raised $26 million, from Sutter Hill, Redpoint Ventures, and Wing Ventures]. Bob Muglia, who used to run Windows at Microsoft, is the CEO.
I’m on my third company. I’m the interim CEO of one of them. I was very active helping run product and engineering for one of them. And the third, I’ve worked with closely for product-market fit. I’m there [at the last] right now as we speak.
How big are these companies and do they leave you time to invest in companies where you don’t play an operating role?
You work 40 percent of the time on the companies you’re helping originate. One [of mine] has 12 employees, one has six, and the last has two, including me. I do have other investments. My first deal at Sutter Hill was in [an enterprise app studio called] Tomfoolery that sold to Yahoo in January. And I’m on the board of two other companies: Boxer in Austin [it makes a mobile e-mail application to access various e-mail accounts] and FoundationDB [which makes a scalable NoSQL database]. I was pretty skeptical about [the latter’s] strong claims, but when they came in, I realized I’d met the team when I was still at Twitter. I was like, Oh, wait, it probably does work.
In your own words, FoundationDB is a tool for building very high scale, fault tolerant, self-healing systems. Why is that such a big opportunity?
In my career, I’d seen tech shift from enterprise companies over to Web companies, and part of what I want to do is bring that back to ops infrastructure companies that offer some core of infrastructure as a service. It’s very different from lower-level applications that you see from Salesforce or Workday.
Why are you more interested in the “bottom of the stack,” so to speak?
I’m somewhat burned from offering tools to developers. My first company aimed to provide continuous deployment to developers, but it’s a tough business. I think these companies are super interesting and they enable a ton, but you have to be pretty clever to make them sustainable. Oftentimes, the biggest advantage you get from a developer-focused product is this ineffable quality of increased productivity, and people don’t pay for that yet. In fact, when someone comes up [to us] with an interesting developer tool, I try to tease out of them what’s the most awesome thing that someone could build with that tool — then I tell them to do that. [Laughs.]
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New Fundings
Ambiq Micro, a four-year-old, West Lake Hills, Tx.-based company that develops energy-efficient microcontrollers, has raised $15.6 million in equity, shows a new SEC filing. The company has now raised at least $36.9 million altogether, shows Crunchbase. Its earlier backers include Austin Ventures, Mercury Fund, and Huron River Ventures.
Arro Corp., a 28-year-old, Chicago-based company that sells processing, contract manufacturing, logistics and warehouse services, has received a $2.25 million loan from the specialty finance company CapX Partners.
Door to Door Organics, a seven-year-old, Lafayette, Co.-based outfit that delivers local produce and natural groceries from organic farmers, has raised $25.5 million in Series B funding led by agriculture investor Arlon Group and the investment bank Rabobank. The company had earlier raised $2 million in funding from Greenmont Capital Partners. VentureWire has more here.
Evernote, the six-year-old, Redwood City, Ca.-based company known for its note-taking apps, has raised $20 million in new funding from the Japanese media giant Nikkei. It has also signed a content deal with company that will see it provide content from Nikkei’s editorial properties in its Evernote’s Context feature beginning early next year. The Context feature will “display relevant articles in real-time to help create a digital workspace that informs and supports users as they accomplish their best work,” says the company, which has now raised $290 million altogether from investors.
Farmer’s Edge Laboratories, a nine-year-old, Winnipeg, Manitoba-based company that offers a range of services to farmers, including drone and satellite imagery of their farmland, soil testing, and predictive computer modeling, has raised an undisclosed amount of Series B funding from Kleiner Perkins Caufield & Byers. The company, also backed by Avrio Capital, tells VentureWire it has now raised $15 million to date.
Flipkart, the seven-year-old, Bangalore, India-based e-commerce juggernaut, is close to raising its third round of funding in 2014 at a valuation of more than $10 billion, according to the WSJ. Flipkart has already raised $1.8 billion across 10 funding rounds that have involved roughly a dozen investors, including Accel Partners, DST Global, and Digital Sky Technologies. In July, Flipkart raised $1 billion at a valuation of about $7 billion.
JANDI, a six-month-old, Seoul, South Korea-based maker of enterprise collaboration tools, has raised $2 million in seed funding led by SoftBank Ventures and Cherubic Ventures. TechCrunch has more here.
Prostate Management Diagnostics, a new, St. Louis, Mo.-based molecular diagnostics firm that’s developing and commercializing genomic tests for the diagnosis and prognosis of prostate cancer, has raised $1.06 million in Series A funding, including from BioGenerator, a nonprofit organization that invests in bioscience companies in St. Louis.
Restoration Robotics, a 12-year-old, Mountain View, Ca.-based company whose newest robots are designed for follicular unit extraction (they help doctors treat baldness), has raised $45 million in Series C extension funding. The capital comes from earlier backers InterWest Partners,Sutter Hill Ventures, Alloy Ventures and Clarus Ventures, among others. The company has now raised $68 million to date, shows Crunchbase.
StratusLIVE, a six-year-old, Virginia Beach, Va.-based company that offers cloud-based fundraising and CRM software to nonprofit organizations, has raised $3 million in funding from unnamed investors. The company has now raised at least $5.3 million altogether, show SEC filings.
Stroma Medical, a nearly six-year-old, Laguna Beach, Ca.-based laser therapy company that claims it can quickly change eye color from brown to blue by removing the brown pigment from the top of the iris, has raised $3.7 million as part of a $4 million round, shows an SEC filing.
Uber, the 5.5-year-old, San Francisco-based car-hailing service, is in early talks with investors about raising at least $1 billion in fresh capital, just six months after it raised $1.2 billion, reports the Financial Times. According to Recode, the new round is likely coming from earlier investors, including Fidelity Investments and BlackRock, and the deal is likely being done at a $25 billion valuation. TechCrunch sources add that the company is shopping the deal as a convertible debt offering, meaning participants would “likely get a discount on the next round of financing. They would also benefit from a better liquidation preference in the case of an exit before Uber raised more money.”
Xiaomi, the 4.5-year-old, Beijing-based smartphone maker, is in talks to raise close to $1.5 billion in new capital at a valuation set to exceed $40 billion, in the largest private financing for a venture-backed company since Facebook in 2011, reports the Financial Times. Negotiations with investors, including Digital Sky Technologies, are yet to be finalized, according to it sources. Last week, Forbes reported the company was exploring funding that would value the company at more than $40 billion.
YourCause, a six-year-old, Carrollton, Tx.-based maker of cloud-based employee engagement software, has raised $4 million in Series A funding from Vocap Investment Partners.
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New Funds
The Massachusetts Life Sciences Center announced last week that it will invest up to $2 million, in individual awards of up to $200,000, to early-stage, Massachusetts-based companies that are selected by a panel of experts. The Boston Herald has more here.
The 13-year-old, San Francisco-based venture firm Artis Ventures is raising a $15 million special-purpose fund called Artis Juicy SPV that states only that Artis cofounder Stuart Peterson is involved. So far, the firm has raised $13.2 million for the effort, shows an SEC filing.
Tina Ju, founding and managing partner of KPCB China, is reportedly raising $200 million venture fund for TDF Capital, another venture fund established by Ju back in 2005. More here from China Money Network.
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IPOs
Capnia, a 15-year-old, Redwood City, Ca.-based company that uses its proprietary medical gas delivery system to develop therapeutic products for chronic diseases, has revealed plans to sell 1.55 million shares at an estimated price of $6.50 in an IPO that would drum up $10.1 million for company. Capnia has raised at least $22 million from private investors over the years, shows Crunchbase, including Teknoinvest, Asset Management Company, and Vivo Ventures.
Momo, a three-year-old, Beijing-based mobile-based social networking platform, filed with the SEC on Friday to raise up to $300 million in an IPO of its American Depositary Shares. The company says it’s the third-most-popular instant messaging app in China, and that its user base more than doubled to 180.3 million in the year through September. Reuters has more here.
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People
Tom Fallows, an e-commerce veteran who has led Google Express since helping found the fast delivery service in late 2012, has left the company to join Uber as it executes out its own plans to become a logistics giant, reports Recode. Google hasn’t yet named a replacement for Fallows.
The Washington Post dissects patent lawyer Ro Khanna‘s failed bid to unseat the Democratic congressman who has represented Silicon Valley since 2000.
Apparently, serial entrepreneur Elon Musk isn’t content with shaking up the automotive and aerospace industries with his companies Tesla and SpaceX. Now he’s looking at ways to make smaller, less-expensive satellites that can deliver Internet access across the globe, according to WSJ sources who say he’s working with Greg Wyler, a satellite-industry veteran and former Google executive.
Jerry Seinfeld joined Facebook recently and he wrote to Mark Zuckerberg on Saturday, “You might really have something here.” The reason for his newfound enthusiasm: After posting a link to the season premiere of his “Comedians in Cars Getting Coffee” web series, it garnered more than 12 million viewers in one day. (Here is that very funny episode, by the way.)
Remember Travis VanderZanden, the former COO of Lyft who left the company in August and joined rival Uber? Well, after Lyft sued him last week, saying he made off with Lyft’s proprietary information, VanderZanden disclosed in court filings that he’d been in discussions with various board members to replace Lyft’s CEO, Logan Green — discussions that Green was not aware of. More here.
Tyler and Cameron Winklevoss say their exchange-traded fund is still under review by the SEC, but that the ETF is “alive and well.” Tyler Winklevoss explained on television last week: “We’re still going through the regulatory process […] Any ETF is a long process to get approved and, in this particular case, we’re dealing with a very innovative product, which is a digital asset which has not been done before.” He added that there has been “no evidence that the ETF [is] going any slower or faster than any other ETF.”
In that live-streamed public Q&A last week, Facebook CEO Mark Zuckerberg talked publicly for the first time about the popular film “The Social Network.” He said that while director David Fincher and writer Aaron Sorkin “went out of their way” to include precise details about some aspects, when it came to the “overarching plot, in terms of why we’re building Facebook to help connect the world, or how we did it, they just kind of made up a bunch of stuff that I found kind of hurtful.” He added: “The thing that I found the most interesting about the movie was that they kind of made up this whole plot line about how I somehow decided to create Facebook to, I think, attract girls.”
Speaking of Mark Zuckerberg and Hollywood, Zuckerberg, along with producer Harvey Weinstein and Digital Sky Technologies investor Yuri Milner, hosted a private screening for the film “The Imitation Game” at a Los Altos, Ca., mansion this past weekend, reports Deadline. Among those invited to the screening of the movie — a biopic about computer scientist and cryptologist Alan Turing — were Facebook COO Sheryl Sandberg, Linkedin’s Reid Hoffman, Google co-founder Sergey Brin, Airbnb’s Nathan Blecharczyk and Theranos founder Elizabeth Holmes.
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Job Listings
Starbucks is looking for a senior business analyst. Amazon is, too. Both jobs are in Seattle. Meanwhile, Criteo is looking for a corporate development manager or senior manager. The job is in Palo Alto, Ca.
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Essential Reads
Apple has finally made it easy to disable iMessage.
Uber has just brought its controversial vehicle-financing program to India.
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Detours
Correcting the record: The CIA tweets the “real” Argo story.
Luxury condos, built for doomsday.
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Retail Therapy
Laser lapels. Hah, hah. Good one.