StrictlyVC: September 12, 2014

It is Friday! Huzzah! Hope you a terrific weekend, everyone. (Web visitors, you can find an easier-to-read version of today’s morning email here.)

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Top News in the A.M.

A group of New York-based Uber drivers, who say they number about 1,000, are attempting to organize a strike against the company on Monday morning over complaints of falling fares and unfair working conditions. BuzzFeed has the story here.

In separate, also bad, news for Uber, the California Public Utilities Commission sent a letter to the company yesterday saying that commercial carpooling — which both Uber and rival Lyft are now orchestrating — is illegal.

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In Palo Alto, a Micro Community in the Making

In Tuesday, in leafy Palo Alto, Ca., tucked away in a nondescript office enlivened by bright, computer-themed art, the 1.5-year-old early-stage firm Pejman Mar Ventures welcomed journalists and investors to watch half a dozen startups explain what it is that they’re doing. Four of the teams were comprised of Stanford students who had tinkered on their nascent ideas at Pejman Mar’s offices this past summer. The other two startups that presented are fully up and running and about to hit the fundraising trail.

In terms of quantity, it wasn’t much of a showcase. Two of the four Stanford-led teams are returning to school, its founders determined to finish their computer science PhDs. Pejman Mar’s timing could have been better, too, given everything else that was going on in the Bay Area on Tuesday, including Apple’s highly anticipated launch event and TechCrunch’s signature fall conference in San Francisco.

Still, plenty of VCs and reporters showed up — including from SoftTech VC, Sequoia, Floodgate, CRV, and Forbes — and for two reasons, seemingly.

First, Pejman Nozad and Mar Hershenson, the firm’s likable cofounders, are highly focused on creating a community around their young firm. Making room for ambitious Stanford students to hole up during the summer months is one way of going about it. The pair also hold weekly events at their space that feature VCs and renowned founders.

Past guests include John Doerr of Kleiner Perkins, Yahoo cofounder Jerry Yang, and Zynga founder Mark Pincus — though an even more popular attraction, says Nozad, is a life coach who comes twice a month to help founders with their personal problems. (“When you say you’re going to have a VC here, maybe 10 or 20 people come,” he says. “As soon as we announced the life coach, we had a wait list.”)

Of course, squishier stuff aside, investors are paying close attention to Pejman Mar because of its track record to date.

On his own, Nozad, who famously sold rugs to tech millionaires before becoming a full-time investor, has backed more than 100 companies over the last 14 years, many of which have gone on to big exits, including the early smartphone company Danger, which sold to Microsoft in 2008 for $500 million. (It’s also through Danger that Nozad met Hershenson, athree-time entrepreneur whose husband cofounded Danger.)

Since launching their fund a year and a half ago, the pair have backed another 21 companies, half of which have raised follow-on rounds – including some doozies. DoorDash, for example, a 1.5-year-old, Palo Alto-based restaurant food delivery startup, closed on a $17.3 million Series A round in May led by Sequoia. The company has raised $19.7 million altogether. Guardant Health, a Redwood City, Ca.-based startup that has developed a blood test for cancer, has also gone on to raise significant funding, most recently raising a $30 million Series B round in April led by Khosla Ventures. Guardant has raised at least $40 million altogether.

Little wonder that on Tuesday, VCs were paying close attention to the two startups that will soon be seeking funding: Solvvy, which is trying to reinvent mobile search and has so far raised $500,000 from Pejman Mar (it’s seeking out more seed funding this fall), and Fieldbook, whose software lets users track and organize their information in simple data tables. Fieldbook has also raised $500,000, including from Pejman Mar; AngelList cofounder Naval Ravikant; former Microsoft executive Steven Sinofsky; and Lotus founder Mitch Kapor. The company says it will seek out more funding in the middle of next year.

It’s a little early to know whether the assembled investors connected with the startups this past week. With Pejman Mar’s growing reputation for spotting promising teams, though, it’s easy to imagine they’ll find interest somewhere along the line. “These companies are for real,” Nozad told me on Tuesday, looking like a proud parent as the crowd chatted with the presenting companies. “They’re great people.”

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New Fundings

6SensorLabs, a 1.5-year-old, San Francisco-based startup whose consumer products will eventually help users determine what’s in their food, has raised $4 million in seed financing led by Upfront Ventures. Other participants in the round included Lemnos Labs, SK VenturesSoftTech VC, Xandex Investments and Mitch Kapor.

AltspaceVR, a 1.5-year-old, Redwood City, Ca.-based virtual reality software company, has raised $5.2 million from investors, including Dolby Family Ventures, Formation 8, Google Ventures, Lux CapitalFoundation Capital, Rothenberg Ventures, SV Angel, Haystack FundTencent, Raine Ventures, Promus Ventures, Western Technology Investment, and others.

Asset Avenue, a 1.5-year-old, L.A.-based online peer-to-peer lending platform that provides its customers with fixed income investments in loans secured by commercial real estate, has raised $3 million in funding from Matrix Partners and NetEase Capital, the venture arm of the Chinese technology company NetEase Inc., reports VentureWire.

Bluestone, a three-year-old, Mumbai, India-based online jewelry company, has raised an undisclosed amount of funding from Ratan Tata, the former chairman of the Tata Group. Bluestone had previously raised at least $15 million, including from Accel Partners, Kalaari Capital, and Saama Capital. LiveMint has the story here.

The Dodo, a nine-month-old, New York-based online media company that focuses on animal stories, has raised $4.68 million in Series A funding led by Discovery, with participation from earlier investors SoftBank CapitalGreycroft Partners, RRE Ventures, Sterling Equities and Bruce Wilpon. The company, founded by Izzie Lerer, daughter of investor Ken Lerer, has raised $5.68 million to date.

Ifbyphone, a nine-year-old, Chicago-based maker of voice marketing software, has raised $30 million in Series E funding from new investor NewSpring Capital, along with earlier backers Apex Venture PartnersSSM Partners, Origin Ventures, River Cities Capital Funds, i2A Illinois Accelerator Fund, and Spring Mill Venture Partners. The company has now raised $60 million altogether.

Liquid Light, a five-year-old, Monmouth Junction, N.J.-based company that develops and licenses process technology to make major chemicals from carbon dioxide, has raised $15 million in Series B financing from new investor Sustainable Conversion Ventures. Earlier investors VantagePoint Capital Partners, BP Ventures, Chrysalix Energy Venture Capital, and Osage University Partners, also participated in the round.

Mediamorph, a seven-year-old, New York-based company whose entertainment analytics software helps film studios, TV networks, and large video service providers measure, manage and optimize their digital distribution, has raised $10 million in Series B funding led by Liberty Global Ventures, with participation from earlier investor Smedvig Capital. The company has raised $23 million thus far, shows Crunchbase.

SmartStudy, a year-old, Beijing-based online education platform, has raised $10.6 million in Serie A funding from Internet giant Baidu, reports China Money Network. Baidu has backed numerous online education firms, says the report, noting that in August, Baidu acquired online education platform Chuanke.

Tink, a 1.5-year-old, Stockholm, Sweden-based personal finance mobile app, has raised $4 million in Series A funding led by Sunstone Capital, with participation from financial entrepreneur Sven Hagströmer and existing investors. TechCrunch has more here.

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New Funds

Blue Cloud Ventures, a two-year-old, New York-based firm that specializes in late-stage cloud software investments, is looking to raise a second fund of $50 million to $100 million, “about four to eight times the size of its first fund,” reports VentureWire. The firm seeks out companies with $50 million to $60 million in revenue, that are two to three years away from an exit, and which may need an additional $10 million to $15 million, it tells VentureWire. Among its investments is AFS Technologies, a 29-year-old, Phoenix, Az.-based company that makes business intelligence software for food and beverage companies.

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IPOs

Underwriters for Alibaba told their sales staffs in a memo this morning that they’ll close all orders for the company’s IPO by Wednesday because demand has been so strong, reports Dealbook. The underwriters added that they’ve received orders with “no sensitivity” to the current price range of $60 to $66 per share, suggesting that range may rise.

Mevion Medical Systems, a 10-year-old, Littleton, Ma.-based company that makes proton therapy systems for use in cancer patients’ radiation treatments, has filed to go public. The company has raised at least $125 million from investors, shows Crunchbase. Its S-1 shows that its biggest shareholders include Still River, which owns 35.3 percent of the company; ProQuest Investments, which owns 14.1 percent; Venrock, which owns 8.4 percent; and CHL Medical Partners, which owns 6.4 percent.

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Exits

Byliner, a three-year-old, San Francisco-based longform journalism startup that very publicly ran into trouble this past summer, has been acquired for undisclosed terms by Vook, a New York-based company that offers digital publishing services to authors and organizations. Byliner had raised $1 million in seed funding, and an undisclosed amount of Series A funding, from investors Bullpen Capital, SoftTech VC, Freestyle CapitalAvalon Ventures, CrunchFund, and ICG Ventures. GigaOm has more here.

Conversant, a 16-year-old, Westlake Village, Ca.-based digital marketing company that was known until earlier this year as ValueClick, has been acquired by Texas-based Alliance Data Systems for $2.3 billion in cash and stock. The deal creates one of the world’s biggest online marketing and data-driven companies, notes the L.A. Times. ValueClick had gone public in 2000.

Eventjoy, a nine-month-old, Menlo Park, Ca.-based startup behind a free digital ticketing platform for event organizers, has been acquired by TicketMaster for undisclosed terms. The startup, part of the Y Combinator Winter 2014 batch, will be incorporated into TicketMaster’s Live Nation Entertainment unit.

Eucalyptus Systems, a five-year-old, Goleta, Ca.-based cloud software startup, is being acquired by Hewlett-Packard for “less than $100 million,” reports Recode. The company had raised $55.5 million across three rounds of funding. Its investors include New Enterprise AssociatesInstitutional Venture Partners, Benchmark and e.ventures.

Mongoose Metrics, a seven-year-old, Independence, Oh.-based voice marketing software company that appears to have been bootstrapped, has been acquired by Ifbyphone, a competing company that just raised $30 million from investors. Terms of the deal were not disclosed. TechCrunch has more here.

Polar, a two-year-old, Lucerne Valley, Ca.-based startup whose technology is used to poll mobile-device users for their opinions, has been acquired for undisclosed terms by Google. The company’s founder and handful of employees will join the company’s Google+ division, says the WSJ.

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People

Entrepreneurs, just how bad do you want funding from Shasta Ventures‘s Rob Coneybeer?

Brad Garlinghouse, the former Yahoo executive brought in to transform the company formerly known as YouSendit into the file-sharing company Hightail, has been replaced as CEO by the company’s cofounder and original CEO, Ranjith Kumaran. (We reported yesterday that Kumaran, who was spent the last four years as CEO of his newest company, PunchTab, had stepped down from that role, replaced by a longtime Citrix executive. Now we know why!) Recode broke the news yesterday, suggesting Garlinghouse’s departure may owe to Hightail’s struggles to differentiate itself in the crowded cloud storage market.

Oculus CEO Brendan Iribe is donating $31 million to the University of Maryland, the largest donation in the school’s history. “The public school system is really important to me,” Iribe told Business Insider. “I grew up locally in Maryland, born and raised, and grew up in public schools. This is part of Oculus’ commitment, and my commitment as CEO, to supporting education.” Iribe, who attended the school from 1996 to 1997, says the money will be used to construct a new computer science building with a dedicated virtual reality lab.

Serial entrepreneur Kevin Rose, who recently left Google Ventures to start a new mobile development company called North, is developing a new app and according to TechCrunch, it lets users share thumbnail-sized photos and animated GIFs that disappear 24 hours later.

Investor Peter Thiel answered questions on Reddit yesterday for an “Ask Me Anything” session and seemed to have fun with it. Asked about his favorite rap artist, he immediately served up fellow VC Ben Horowitz.

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Job Listings

CalPERS is hiring an investment officer. The deadline to apply is September 25th.

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Essential Reads

Google just launched a cloud platform for startups.

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Detours

Twenty-five absurd photos of billionaire Richard Branson.

Things you will find at Google’s online store.

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Retail Therapy

We said we’d never ever never want a van. Then we spied this.


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