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Top News in the A.M.
Apple CEO Tim Cook says Apple will be adding security alerts for iCloud users.
Ariel Poler: I Don’t Want to Become a Professional Investor
For 15 years, Ariel Poler did the entrepreneur slog, founding I/PRO, an early web analytics company; Topica, an email community; and the mobile marketing startup TextMarks. Then, in 2010, Poler decided to turn his attention entirely to angel investing, a pastime in which he’d long dabbled and that has also proved lucrative for him thanks to numerous hits, including AdMob (acquired by Google) and StumbleUpon (acquiredby eBay and taken private again).
Poler’s investing career took shape in the late ’90s when he began helping out the boards of several startups, including Kana Software andLinkExchange, in exchange for equity. He still doesn’t think of himself as an “investor,” though, or plan to raise a fund. “It’s just not what I want to do for a living.” He explained during a recent chat.
How many startups do you invest in per year and what size checks do you write?
I don’t have a target but it’s worked out to be between three and five per year. In terms of the size of check, the average is probably $50,000.
You’re involved with a lot of “hot” companies, including the cycling and running app company Strava. Why not raise a fund like everyone else in your position?
I don’t think of myself as an investor. I won’t invest in an entrepreneur who I won’t have over for dinner. I don’t want to have to optimize for financial return. To become a professional investor, it just not what I want to do for a living. It’s not why I do it.
You want to like the people you’re backing. How do you decide if it’s a good fit?
It’s becoming harder. Because the speed at which startups get built and funded has accelerated significantly in recent years, there’s generally less time for people to understand if there’s a good fit. On rare occasions, I think [something] will be a good fit, then discover it isn’t. But that’s another benefit of [not being obligated to outside investors]. When that happens, I hold on to my shares, but I won’t proactively spend my time with the startup.
What I try to do is interact a little bit in a way that’s proactive for entrepreneurs [like via] working meetings. I recently met with some founders who needed to pick a vertical for their product and needed help prioritizing, and I said, “Let’s pretend I’m a member of the team,” and we spent an hour and a half [on the issue], and I enjoyed it and they enjoyed it. That’s how it starts. Because everything is moving so quickly right now, you might not have the luxury of [spending a few weeks or more with a team], but I still try.
You were on the board of Odeo, a platform for podcasters out of which Twitter was eventually spun, and you let founder Evan Williams buy back your shares. Was there a lesson in that experience?
Everybody got their money back. It wasn’t an option. It wasn’t like some said, “Give me my money,” and others didn’t. Evan wanted to own 100 percent of Odeo and he bought everyone out. Then months later, he did a financing for Twitter and a small group of those who’d been investors in Odeo participated in the Twitter round. For me, when I was deciding, I thought Twitter had potential; I did feel pretty good about it. But there were other reasons I decided not to invest and they’re reasons that were pretty valid and go with my investment philosophy.
That was the worst professional decision of my career, no question about that. [Laughs.] But if you look at most of the very successful companies, it’s very hard to predict [their rise]. When Evan came to the board and said, “I don’t want to do this anymore,” Twitter was already part of Odeo. We [the board] said, “The founder doesn’t want to do it. We don’t have any traction. We should try to sell it.” It was my job as a board member to find an investment bank, and I did. I was thinking Twitter could help MySpace compete against Facebook. But no one would take it for free — not for a dollar. That’s when Evan said, “I’ll do an incubator [and restart].”
Many investors seem to think it makes sense to just back an entrepreneur like Williams an infinite number of times.
That’s a common takeaway. But sometimes they try again and it works, and sometimes they try and it doesn’t. We all thought Twitter could be great but it wasn’t a slam dunk.
Beddit, an eight-year-old, Espoo, Finland-based company that makes an ultra-thin sleep monitoring sensor, has raised an undisclosed amount of funding led by Inventure, a Nordic early-stage venture capital firm. The company has now raised $8 million to date, it says.
Bridj, a nearly three-year-old, Cambridge-based pop-up bus service, has raised $4 million led by Atlas Ventures, NextView Ventures, Suffolk Equity and Freshtracks Capital. Angel investors Jill Preotle, Andy Ross and Peter Aldrich also participated in the round. BostInno has much morehere.
Cignifi, a four-year-old, Cambridge, Ma.-based company whose analytics platform produces credit and marketing scores using mobile phone behavioral data, has raised an undisclosed amount of Series B venture funding led by earlier investor Omidyar Network. American Express Ventures and other, unnamed earlier investors, also participated in the round.
Cord, a months-old, Brooklyn, Ny.-based voice communication app that makes it easy to send a quick voice message, has raised $1.8 million in seed funding led by Metamorphic Ventures, along with Google Ventures, Slow Ventures, Gary Vaynerchuk, Lerer Hippeau Ventures,Greycroft, Melo7 Tech Partners, Ricky Van Veen, and Xavier Niel.
DataStax, a four-year-old, Santa Clara, Ca.-based database management company, has raised $106 million in Series E funding led by Kleiner Perkins Caufield & Byers. Other participants in the round included ClearBridge Investments, Cross Creek Advisors, Wasatch Funds,Comcast Ventures and PremjiInvest, the family office of Wipro founder Azim Premji. The company has now raised $190 million altogether. Venture Wire Dispatch has much more here.
Delta ID, a three-year-old, Newark, Ca.-based maker of biometric authentication software for mass-market computing devices, has raised $5 million in Series A funding from Intel Capital and other, unnamed investors. The company has now raised $6.1 million to date.
GetSet, a two-year-old, Chicago-based social productivity tool meant to help college students build peer mentoring networks, has raised $2.5 million in seed funding from Chicago Ventures, KGC Capital, The Social+Capital Partnership, G2T3V, and individual investors. EdSurge has more here.
KnCMiner, a year-old, Stockholm, Sweden-based maker of bitcoin mining hardware, has raised $14 million in Series A funding led by Creandum. TechCrunch has more here.
LiveAction, a seven-year-old, Palo Alto, Ca.-based network and application performance management company, has raised $5.35 million in Series A funding led by AITV, with participation from Cisco and Enerdigm Ventures.
MetricStream, a 15-year-old, Palo Alto, Ca.-based maker of risk and compliance software, has raised $60 million in Series D funding led by Sageview Capital. Earlier investors Goldman Sachs and Kaiser Permanente Ventures also participated in the round, which brings the company’s total funding to $160 million.
Narrative, a 2.5-year-old, Linköping, Sweden-based company whose small, clip-on camera allows people to capture images and “lifelog,” has raised $8 million in Series A funding led by Khosla Ventures. Earlier investors Passion Capital and True Ventures also participated in the round, which brings the company’s total funding to $12.2 million.
Propeller Health, a four-year-old, Madison, Wi.-based digital health company focused on chronic respiratory disease, has raised $14.5 million in Series B funding led by Safeguard Scientifics, with earlier investor The Social+Capital Partnership participating. The company has raised $28.4 million to date.
Tapdaq, a two-year-old, London-based community-driven mobile ad exchange, has raised a $1.4 millon seed round led by Balderton Capital. TechCrunch has more details here.
Symphony Commerce, a four-year-old, San Francisco-based company that delivers commerce as a service, handling wholesale and retail business functions like logistics, has raised a $21.5 million in Series B funding led by CRV, with participation from earlier investors Bain Capital and FirstMark Capital. The company has now raised $39 million to date, shows Crunchbase.
Whale Path, a 1.5-year-old, San Francisco-based on-demand business-research platform, has raised $1.1 million in seed funding from TMT Investments, Kima Ventures, 500 Startups, Altair Capital, FundersClub, Wefunder, and individual investors.
Upland Software, a four-year-old, Austin, Tx.-based maker of cloud-based enterprise work management software, has filed to go public, revealing plans to raise up to $50 million. The company has raised at least $31.4 million from investors over the years, shows Crunchbase. Its biggest backers include Austin Ventures, which owns 19.9 percent of the company; Activant Capital, which owns 7 percent; and ESW Capital, which owns 24.5 percent.
Allegro Diagnostics, an eight-year-old, Maynard, Ma.-based genomic test maker, has been acquired by the publicly traded diagnostics company Veracyte for $21 million. Allegro had raised $5.4 million from Catalyst Health & Technology Partners and Kodiak Venture Partners, shows Crunchbase.
Twitpic, the photo-sharing site, will be shutting down September 25th because of a trademark dispute with Twitter, the company announced on its blog yesterday. Users will be able to export all their photos and videos in the next few days.
Carmelo Anthony, the NBA star who recently cofounded the investment firm Melo7 Tech Partners, says he runs potential investments past VCs Marc Andreessen and Ben Horowitz, whom he calls mentors. “We’ve built a great rapport,” says Anthony.
Ali Partovi, a well-known Silicon Valley investor and entrepreneur, is joining the food startup Hampton Creek as its chief strategy officer. The New York Times has more here.
Nathan Sanders is the newest GP at Technology Crossover Ventures. Before joining the firm, Sanders spent eight years at Bain Capital, as part of both its private equity investment team and its investor relations team.
Emmett Shear, founder and CEO of Twitch, talks with Bloomberg about why the company chose to sell to Amazon rather than Google. (One words that comes up a lot: “independence.”)
The White House made it official yesterday: Megan Smith, the longtime Google executive, is the country’s new CTO. Alexander Macgillivray, a former Twitter lawyer, was also officially named as deputy U.S. CTO.
Ariel Tseitlin has been promoted from venture partner to partner at Scale Venture Partners. Tseitlin was previously a director of cloud solutions at Neflix. The firm has also promoted Cack Wilhem, a summer associate, to principal. Wilhem previously worked in sales at Cloudera and Oracle and spent a year as an analyst at the investment bank Montgomery & Company.
Route 66 Ventures, an early-stage venture firm in Alexandria, Va., is looking for a financial analyst.
The TechCrunch Disrupt conference kicks off on Monday in San Francisco. You can check out the full agenda here.
The Launch Scale conference is coming up, too, October 23rd and 24th in San Francisco. Learn more here.
Tech companies are grabbing up as much cash as they can pre-IPO. Meanwhile, venture-backed healthcare companies are moving in the opposite direction, says CB Insights.
The New York Times on Apple’s forthcoming smartwatch: “The company put an enormous amount of time and money in the wearable device’s sensors so that they would track movements and vital signs, like heart rate and footsteps, much more accurately than existing fitness devices, two employees said. It has a flexible display panel that is protected by a cover composed of sapphire, a type of tougher glass, they said. The device’s circuit board, which includes its sensors and chips, was described as tiny, about the size of a postage stamp.”
Not to be a bummer, but a new analysis of air traffic patterns shows that there’s up to an 18 percent chance the Ebola virus will reach us in the next few weeks.
Shorts are considered ridiculous and unwearable outside the U.S. Is it time for American men to ditch them, too?
Oh, to be a dog.
And you said there was no such thing as a beautiful vacuum.