StrictlyVC: January 30, 2014

110611_2084620_176987_imageHi, Happy Thursday, everyone!

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Top News in the A.M.

The PC may be dying, but tablet growth is slowing, too, as saturation sets in.

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Swell, a Pandora for News Radio

It’s hard to find an overlooked niche, but Palo Alto-based Concept.io may have found one with Swell, a seven-month-old smartphone app focused on streaming personalized news radio.

Unlike competitors whose users choose what they want to hear, Swell is a discovery service that learns users’ listening preferences over time and pushes them content they’re liable to enjoy. Don’t like what’s steaming? Swipe, it’s on to the next story.

The app is easy, even delightful, particularly for fans of NPR, the BBC or Comedy Channel — just three of Swell’s growing number of content partners.

The question is whether young app users will embrace it in large enough numbers. Pew Research Center’s recent surveys find that while nearly 60 percent of Baby Boomers say they enjoy following the news “a lot,” the number drops to 45 percent of Gen Xers and just 29 percent of Millennials, a generational difference that has remained virtually unchanged over years of surveys. (When it comes to news radio, specifically, 38 percent of Gen-Xers and 27 percent of Millennials tell Pew they’ve consumed news radio as recently as “yesterday.”)

To learn more about who’s using the app and when and what’s next, I caught up with Concept.io founder and CEO Ram Ramkumar, whose last company, SnapTell, sold to Amazon in 2009. Our chat has been edited for length.

How did the idea of Swell come about?

We really wanted to build a product that people would use every day and that would really engage users and make use of their time when they’re driving or exercising – time that’s underutilized, generally.

Much of product’s allure is that you just turn it on, like the music discovery service Pandora. Broadly speaking, how does the personalization technology work?

It’s complicated. Let’s say you’re interested in startups, and perhaps you love long content in the afternoon and shorter content in the morning. Well, we have to manage the freshness of the content, which is unique to the spoken word. If you think about it, music is relatively evergreen, but with news or stories, you don’t want to hear something that’s stale, so it’s a difficult problem. We’re shifting through thousands of individual tracks and finding the ones that you most want.

Are there any humans involved?

We have an audio curator who comes from the radio world and curates the content that goes into Swell at a program level. After that, an algorithm kicks in your preferences, so someone who loves the “Freakanomics Radio” show might like an Economist podcast. Then, the most powerful element comes into play, which is the community network effect, where what Swell’s hundreds of thousands of users love gets automatically promoted — and what they don’t love is less likely to show up in your queue.

So Swell has hundreds of thousands of users?

Yes, hundreds of thousands and not millions yet, but it’s growing gradually. And we have really strong engagement. We see more than 40 minutes of listening per day and over four hours of listening per week. There’s a big uptick in the morning and also in the afternoon, when people are commuting.

And eventually, you’ll insert ads into the stream, a la Pandora?

Right. Ads and subscriptions are the way to go, though there are also special things you can do, like offering users access to their entire listening histories so they can search through what they’ve listened to in the past. So we can do premium features along with advertising as it gets to critical mass. What we’re working on next is adding identity and a social layer to the product, so you can sign into Swell and see what your friends are listening to and share.

You raised $5.5 million from Google Ventures and others last summer. Is that expected to last you a couple of years? Are you interested in raising more yet?

We’ve had interest and continue to have interest. Our A round was preemptive – someone called and wanted to invest — and there’s a possibility that that will happen again. But we’re not looking to raise money.

JamBase

New Fundings

Blue Bottle Coffee, the 12-year-old, Oakland, Ca.-based specialty roaster, has raised $25.75 million from a “range of high-profile Internet players” and numerous clients of Morgan Stanley Investment Management, reports Re/code. The company has now raised roughly $45 million altogether, including from Google VenturesIndex VenturesTrue VenturesKevin SystromEvan WilliamsChris Sacca and skateboarding star Tony Hawk.

Daily Secret, a three-year-old, New York-based digital media startup, has raised Series B funding led by PanAfrican Investment Co., founded byRichard Parsons and Ronald Lauder. Return backers Greycroft Partners and e.Ventures also participated in the round. The company isn’t reporting the amount, but StrictlyVC had flagged a filing for this round in early December that showed $1.25 million in new funding. Daily Secret, which emails users a daily “best kept secret” about their favorite cities, has raised $3.1 million altogether.

Flat World Education, a 6.5-year-old, Washington, D.C.-based education content and software startup, has raised $9.5 million led by Bessemer Venture Partners. Earlier investors Valhalla PartnersTribeca Venture PartnersPenguin Random House Holdings and Bertelsmann Digital Media Investments, also participated in the funding.

Guardly, a 3.5-year-old, Toronto-based company whose mobile safety apps are designed to help schools, corporations, healthcare organizations, transit systems and municipalities, communicate more effectively during emergency situations, has raised $1.45 million in seed funding led by Freestyle CapitalGolden Venture Partners and MaRS Investment Accelerator Fund also participated in the round.

Origami Logic, a 2.5-year-old, Menlo Park, Ca.-based company that’s developing a visual, self-service analytics platform specifically for marketers, has raised $15 million in Series B funding led by Jafco Ventures. Earlier investors Accel Partners and Lightspeed Venture Partners also participated in the round, which brings Origami’s total funding to date to roughly $24 million.

Versa, a 2.5-year-old, New York-based company that designs interactive media experiences for advertisers — including sponsored products that run in major papers like the Houston Chronicle, has finished raising a $2 million seed round led by the Omidyar Network. Others to participate in the round included the James L. Knight Foundation and Quotidian Ventures. The company’s earlier investors include Digital News VenturesComcast VenturesBrooklyn Bridge VenturesLiberty City Ventures and Gabriel Investments.

ZappRx, a two-year-old, Cambridge, Ma.-based platform for electronic prescriptions, has raised $1 million in seed funding led by earlier investorAtlas Venture. The funding also included SR One, and individual investorsTerry MeguidDavid HamamotoSean Trigony and James Glimm. The company has raised $2.2 million altogether so far.

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New Funds

China-focused venture firm Banyan Capital has closed on $206 for its first venture capital fund, according to China Money Network. The fund will focus on technology, media and telecommunications startups. The firm’s founders were previously with IDG Capital Partners in China.

A new startup accelerator, Boomtown, is launching in Boulder, Co. to help nurture new Internet, mobile and software startups. Atlanta-based venture capital firm Farmore Capital Group is the lead investor.

Anil Joshi, who previously headed Mumbai Angels network, is raising a$25 million fund designed to make pre-Series A investments. Called Dev Venture Fund, the vehicle will back 15 to 20 companies with checks in the range of $300,000 to $2 million. Joshi became the president of the angel investors network two years ago. He held a number of operating roles earlier in his career, including as a marketing officer at the Mumbai-based rayon filament yarn producer Century Rayon.

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IPOs

Ultragenyx Pharmaceutical, a 3.5-year-old, Novato, Ca.-based rare drug developer, has increased its IPO offering price to $19 to $20 per share, up from $14 to $17 per shape. It’s hoping to raise as much as $98 million from the sale of 4.8 million shares this week. The company’s biggest backers are TPG, which owns 13.2 percent, Beacon Bioventures, which owns 13.2 percent, HealthCap, which owns 11.7 percent, Adage Capital Partners, which owns 7.4, Capital Research Global Investors, which owns 6.4, and A.M. Pappas Life Science Ventures, which owns 5.9 percent.

FierceBiotech takes a look at the rest of the expected deluge of first-quarter biotech IPO filings.

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Exits

Digitalsmiths, a 16-year-old, Durham, N.C.-based video technology company, has been acquired for $135 million in cash by publicly tradedTiVo. Digitalsmiths, whose “seamless discovery” technology reportedlymakes it easier to find video content on a wide variety of screens, had raised $31.5 million over the years, including from Aurora Funds,Chrysalis VenturesCisco, and .406 Ventures.

Dijit Media, a two-year-old, San Francisco-based social TV startup whose offerings included a personalized programming guide, has been acquired by competitor Viggle, which offers rewards for checking into TV shows and listening to music through its app. Terms of the deal weren’t disclosed.More here. Dijit had raised money from individual investors, including Alan Braverman, a former Geni.com exec who went on to work for Yammer and Fwix.

DVS Sciences, a 10-year-old, Sunnyvale, Ca.-based company that had developed a single-cell protein analysis platform, has been acquired by publicly traded Fluidigm for $207.5 million in cash and stock. DVS had raised $14.6 million from investors, including 5AM VenturesMohr Davidow Ventures and Pfizer Venture Investments.

HowAboutWe.com, a 3.5-year-old, New York-based company, announced yesterday that it has acquired the lifestyle and dating site Nerve.com. The terms of the deal aren’t being disclosed. HowAboutWe has raised roughly $22 million from investors, including fromFounder Collectiveff Venture CapitalHigh Line Venture Partners,RRE Ventures and Khosla Ventures.

The Kernel, a two-year-old, London-based news site about online culture, has been acquired by Austin-based Daily Dot Media, which oversees a pop and tech culture site. Terms of the deal aren’t being disclosed. The Kernel had raised seed funding from BERLIN42 and angel investors. Its founder and editor, Milo Yiannopoulos, will be “pursuing new projects,” he said in a statement.

Lenovo is buying the Motorola handset business from Google at the bargain-basement price of $2.91 billion in cash, stock, and a three-year promissory note. Google, which paid $12.5 billion for Motorola in the spring of 2012, will retain most of Motorola’s patent holdings, reports Re/code, while Lenovo gains access to 2,000 patents, the Motorola brand, and its product portfolio.

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People

Chris Girgenti, a managing partner at Chicago’s Pritzker Group Venture Capital, says the firm is making a stronger push into New York as it broadens its investment strategy. “Eventually, we’ll open an office [here],” he tells Crain’s New York Business.

John Hershey, the senior investment officer in charge of the alternatives portfolio at Oregon State Treasury, is moving into a new, expanded role, effective February 1, reports Chris Witkowsky, who says Hershey’s new role includes managing the outfit’s private equity portfolio.

Kristin Richards and Elisa Schreiber have joined Greylock Partners, the firm announced yesterday. Richards, the firm’s new VP of Talent, comes to the firm from Spencer Stuart; before joining Spencer Stuart, she spent four years as director of executive recruiting at Accel-KKR. Schreiber joins as VP of Marketing from Hulu, where she served as its head of communications for several years.

Paul Sagan, the former CEO of Akamai Technologies, has joined General Catalyst Partners as a partner. Dealbook has more here.

Joerg Sievert has left SAP Ventures European Advisors, where he was a managing director. In an email sent to his contacts yesterday, Sievert, who has spent the last years with SAP Ventures, said he’d accepted a job as a managing director of a “global fund.”

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Job Listings

Pinterest is looking for a head of mobile business development in San Francisco.

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Essential Reads

Facebook wants to be a newspaper. And it wants you to be writing some of its best stories.

A U.S. terrorism defendant who was spied on by the NSA filed a challenge to the constitutionality of the surveillance yesterday, in a case likely to be litigated all the way to the Supreme Court.

Shares of Vringo jumped as much as 37 yesterday morning, after a judge increased the royalty rate Google must pay for violating its patents related to Google’s AdWords business.

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Detours

Facebook is 10 years old. How much time have you wasted of your own life on the platform? Find out using this upsetting app.

What is that thing? A gravity-defying home, on Sunset Boulevard.

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Retail Therapy

Nothing says, “Let’s get this deal done,” like a power pair of dog-faced cufflinks. (Are we right or are we right?)

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