Hi, happy Tuesday morning, everyone!
Last week, while at the helm of StrictlyVC, Semil Shah interviewed renowned investor-entrepreneur Elad Gil in a two-part conversation, the second half of which we’re running today. If you have any questions about the chat, feel free to reach out to Semil directly at @semil. If you have a question, complaint, or juicy gossip for me, you can find me at @cookie and @strictlyvc.
Top News in the A.M.
“Government bean counters have given the Federal Communications Commission the green light to find out whether big telecom companies are charging other businesses too much for connectivity,” reports the Washington Post.
Elad Gil on Angel Investing, AngelList, and His New, Stealth Startup
In 2009, Elad Gil sold his company, Mixer Labs, to Twitter, where he worked another two-and-a-half years as a VP before plunging back into the world of startups — and startup investing. Recently we talked with Gil about how, more precisely, he’s spending his time these days.
As an individual investor — what stage do you prefer to invest in today, and how has that changed over time?
I’ve always been pretty stage agnostic as an investor, which I think is a bit contrarian in the individual angel market. Most of my investments have been seed rounds, but I’ve also invested in a reasonable number of Series A, B and C rounds.
One of the reasons I’ve always invested in a broader range of companies is my background as an operator. My role at Twitter was effectively to help scale the company. Since I was involved in a lot of aspects of managing hockey-stick growth — internationalization, user growth, scaling recruiting process, M&A, analytics, product, etc. — a number of later-stage breakout companies have asked me to get involved as an investor or advisor as I have been through the same terrifying growth curve they are now seeing.
From a purely financial perspective, I only invest invest in companies that I think may have anywhere from 10x to 1000x upside left. Obviously that’s easier as an early-stage investor.
How do you plan to use a platform like AngelList in the future, if at all?
AngelList is going to transform whether branded individual angels eventually transition to larger firms. If an individual angel has the access and deal flow, we’re very close to the day where they can effectively run a fund in a friction-free manner on top of AngelList. AngelList helps with the fundraising, as well as takes care of the ongoing back office — accounting, legal, fund set-up, carry management, etc. — for the angel. Already, you see people like Scott and Cyan Bannister and Gil Penchina making use of AngelList as an LP and back-office platform.
For newer angels, AngelList provides any angel the opportunity to have an instant fund — in other words, the syndicate — back the angel. The angel can take carry this on, while AngelList manages that person’s back office. So it may also create the opportunity for new angels, with much less personal capital, to start effectively a micro-VC firm. I wouldn’t be surprised if some interesting dynamics emerged on the platform, like if every YC batch had one founder who raised an AngelList-based fund to invest in all of his or her YC batch mates. Maybe [AngelList] turns YC into an inadvertent launching pad for micro-VCs as well.
You’re working on a new startup. Without giving up too many details, can you share what space you’re working in and what you anticipate happening in the industry over the next three to five years?
My prior startup was a developer platform product that Twitter acquired. More recently I co-founded a genomics company and, in particular, software to make genetic testing and genomics widely available. This industry has seen a 10,000x drop in cost over the last few years, but software and other aspects of these services haven’t kept up. While I’m skeptical that anything fundamental has shifted in biotech as a whole to make it more attractive investing-wise, I’m very bullish on the shifts occurring in genomics.
Algolux, a 1.5-year-old, Montreal-based startup that specializes in computational optics for better photographs, has raised $2.6 million in Series A funding led by Real Ventures. Numerous unnamed angel investors also participated in the round. Betakit has more here.
Algorithmia, a 1.5-year-old, Seattle-based marketplace that gives algorithm developers in academia and elsewhere a way to share their work, has raised $2.4 million in seed funding led by Madrona Venture Group, with participation from Rakuten Ventures, Deep Fork Capital, Oren Etzioni and Charles Fitzgerald.
AppNexus, the seven-year-old, New York-based ad tech company, has raised $60 million in fresh funding from “a large, Boston-based public equity and asset management firm,” CEO Brian O’Kelley tells Business Insider. Other earlier and strategic investors are considering adding up to $40 million more to the round, too, according to the report. AppNexus has now raised roughly $230 million, including from First Round Capital, Khosla Ventures, Kodiak Venture Partners, Venrock, Tribeca Venture Partners, and Technology Crossover Ventures. The money allows the company to steer clear of the current IPO market, which has “crushed” ad tech stocks this year, notes O’Kelley.
GuardiCore, a 1.5-year-old, Tel Aviv cyber-security startup whose software reroutes and analyzes malicious traffic, has raised $11 million in Series A funding led by Battery Ventures. Other participants in the round included Greylock IL and undisclosed strategic partners.
Poppin, a five-year-old, New York-based maker of fashionable workplace products, has raised $17 million in Series C funding from new investors Fifth Third Financial Corp. and West Capital Advisors, as well as earlier investors Shasta Ventures, First Round Capital, and Creative Capital Fund. Poppin has now raised $34.1 million altogether, shows Crunchbase.
Purplebricks, a months-old, Birmingham, England-based company that charges low, fixed fees to help people both sell and rent their homes, has raised $11.7 million from Neil Woodford, one of Britain’s highest-profile fund managers. Citywire has more here.
Self Health Network, a three-year-old, San Francisco-based software platform that healthcare providers use to ensure their patients are following their aftercare instructions, has raised $5.6 million in equity and debt, shows an SEC filing. VentureBeat has more here.
Tutum, a year-old, New York-based company lets developers manage and run lightweight, portable, self-sufficient containers from any application, has raised $2.7 million in funding, shows an SEC filing that lists Kirill Sheynkman of RTP Ventures, among others. The company had previously raised $65,000 in seed funding from NXTP Labs andTechstars, shows Crunchbase.
uBiome, a 1.5-year-old, San Francisco-based company that’s trying to map the human microbiome with citizen science (users receive a kit that harvests the organisms in their body), has raised $1.5 million from angel investors and $3 million from Andreessen Horowitz, reports TechCrunch. The company had raised roughly $350,000 through an Indiegogo campaign last year.
Unified Office, a four-year-old, Portsmouth, N.H.-based company that sells cloud-based virtual office services to small and medium-size businesses, has raised an undisclosed amount of funding from Bill McCullen, CIO at LaunchCapital, and Rick Burnes, who cofounded the venture firm CRV.
WebLinc, a 20-year-old, Philadelphia-based commerce platform provider for online retailers, has raised $6 million in Series A funding from publicly traded Safeguard Scientifics.
HealthQuest Capital, a year-old, Menlo Park, Ca.-based firm founded by Sofinnova Ventures partner Garheng Kong, has closed on $110 million for its debut fund, Kong tells Xconomy. HealthQuest, which operates out of Sofinnova’s offices and shares many of its limited partners, intends to use the capital to fund medical devices, diagnostics and health-care information technology startups — companies it hopes will complement those backed by Sofinnova, which primarily focuses on biopharmaceutical investments.
OpenView Venture Partners, the eight-year-old, Boston-based firm that focuses exclusively on expansion-stage SaaS companies, is raising a fourth fund, according to an SEC filing that doesn’t list a target and says the first sale has yet to close. OpenView closed its debut fund in 2006 with $108 million; it closed its second fund with $131 million in 2009; and it closed its third fund with $200 million in 2012, after targeting $150 million. The firm had said at the time that it secured all of its commitments in the span of three months.
Orios Venture Partners, a new, Mumbai, India-based venture capital fund, has closed on more than $50 million to back India-based Internet and B2B software startups, reports VCCircle. Orios was founded by Rehan Yar Khan, a prolific angel investor and serial entrepreneur.
Blockr.io, a popular explorer for the Blockchain, has been acquired by the wallet and merchant processing company Coinbase, in a transaction that TechCrunch characterizes as as talent acquisition.
GetViable, a two-year-old, Melbourne, Australia-based social collaboration startup platform that helps startup founders get their ideas off the ground, has been acquired for undisclosed terms by Bigcolors, a Hong Kong-based startup crowdfunding platform and venture capital firm. More here.
Xenotis, an 11-year-old, Australia-baesd maker of biosynthetic grafts that are implanted in patients getting below-the-knee bypass surgery, has been acquired by LeMaitre Vascular, a publicly traded company in Burlington, Ma. The purchase price was $7.7 million. The Boston Business Journal has more here.
Former Vice President Al Gore is suing Al Jazeera, claiming the satellite news provider that Gore once described as having the “the highest quality, most extensive, best climate coverage of any network in the world,” owes him and partner Joel Hyatt $65 million from a deal to buy his network, Current TV.
Corey Griffin, a 27-year-old associate at Bain Capital Ventures, died in the early hours of Saturday morning, following a diving accident. According to Bloomberg, Griffin joined Bain “as an analyst in an internship program and stayed on for three years ‘because nobody wanted him to leave,’ said Jeff Schwartz, a founding partner of the unit.” Griffin, who was named an associate in 2012, had jumped from the roof of a two-story building into Nantucket Harbor, say local police. He suffered two crushed vertebrae.
One of Russia’s newest technology tycoons, Lev Leviev, has unveiled his first foray into the bitcoin world, a block chain visualiser called BlockTrail that launched publicly yesterday. More here.
For Yuri Milner, the “ice bucket challenge” is a family affair.
Thomas Montag, a former Goldman Sachs executive who has helped build Bank of America into an investment banking powerhouse, has been named the bank’s sole chief operating officer, reports Dealbook.
State Street is looking for an alternative investment analyst. The job is in Boston.
A calculator to help you decide if your startup should pay to advertise.
Google is seeking out new customers: Kids.
The rise of the anti-Facebook.
Levi’s Stadium — home to the San Francisco 49ers — is now the most high-tech stadium anywhere in the world.
The ten most exclusive golf courses in the world.
The case for always talking to strangers.
Matthew Weiner on the end of “Mad Men” — and the beginning of his new movie.
The Confederate X132 Hellcat Speedster. If there’s a better-looking bike, we haven’t seen it.