Hi, happy Tuesday, everyone! We’re in ridiculously beautiful Aspen for a couple of days to catch Pokemon attend a Fortune conference. Having fun here; we’re also a little exhausted.:)
Btw, if you’re here, too, and want to meet up, let us know. We won’t be quite as crazed today as yesterday.
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Top News in the A.M.
Now a third Tesla crash is being blamed on Autopilot. Elektrek has more here.
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Who, Us? VCs Blame Banks for Messaging to Startups
Despite all the capital that venture firms have managed to raise in the first and second quarters of this year, venture capitalists at an investor panel at Fortune’s Brainstorm conference this morning said that early-stage valuations are softening, reality is “setting in” for unicorn companies that are too richly valued to be acquired and too immature to go public, and that there’s much more focus on revenue than in recent years.
The VCs also blamed bankers on their messaging to founders, which, until recently, was to focus on growth at all costs.
When it comes to very early-stage valuations, Floodgate cofounder Ann Miura-Ko said she thinks her firm is seeing more “willingness by entrepreneurs to take much lower valuations than what their initial expectations were” for two reasons. One is increasing conservativeness on the part of venture capitalists. The other, she said, is “fear for the next round of financing. They’ve already heard from other entrepreneurs that the next round of financing is going to be really difficult.”
In terms of falling valuations for later-stage companies, general partner Roger Lee of Battery Ventures said they’re all but inevitable, given that there’s been one “truly notable” tech IPO in the U.S. so far in 2017. As he noted, a new category of investors had emerged — including hedge funds and mutual funds — to fund these companies’ later stage funding rounds based on the assumption that there would be a brisk IPO market. Absent one, these companies now need to “focus on the fundamentals” to prove that they’re worth the valuations they were assigned.
Of course the big question, and one posed by Brainstorm co-chair Dan Primack, is why companies weren’t focusing on the fundamentals from the start. “Is it the [founders’] fault or yours,” he asked the VCs, including Spark Capital general partner Megan Quinn, who readily acknowledged that there was “certainly a point in time in the Valley when investors were funding growth above all else.” Because “public markets were rewarding it?” Primack asked. “Yes,” said Quinn, “exactly.”
It’s an observation that Jeff Fagnan, a founder of Accomplice (formerly the tech group at Atlas Venture) agreed with wholeheartedly. VCs’ focus on growth was “definitely driven by the public market,” he told those gathered. “I remember being in a couple of IPO bakeoffs, and these bankers would always focus on [growth] . . . And they said, ‘You don’t really need to worry about profit. Just grow. This is the story that everybody wants to buy.’”
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New Fundings
3scan, a five-year-old, San Francisco-based computational pathology platform company, has raised $14 million in Series B funding co-led by Lux Capital and Data Collective, with participation from Dolby Family Ventures, OS Fund, Comet Labs and Breakout Ventures. TechCrunch has more here.
Codecademy, a five-year-old, New York-based online coding school with 16 million registered users, has raised $30 million in new funding led by Naspers Ventures, with participation from Union Square Ventures, Flybridge Capital Partners, Index Ventures and Sir Richard Branson. The company has now raised $42.5 million altogether. TechCrunch has more here.
CornerJob, a year-old, Barcelona, Spain-based mobile jobs marketplace, has raised $25 million in Series B funding led by Northzone, with participation from e.ventures. TechCrunch has more here.
Freshly, a four-year-old, New York-based company that delivers healthy meals for $11 per meal, has raised $21 million in Series B funding led by Insight Venture Partners, with participation from previous investors Highland Capital Partners and White Star Capital. TechCrunch has more here.
Paktor, a three-year-old, Singapore-based dating app that rivals Tinder in Southeast Asia, has raised $10 million in fresh capital led by YJ Capital, the corporate venture firm belonging to Yahoo Capital. Other participants include Global Grand Leisure, Golden Equator Capital, Sebrina Holdings and earlier backers Vertex Ventures, MNC Media Group, Majuven and Convergence Ventures. The company has now raised $22 million altogether. TechCrunch has more here.
RedKix, a nearly two-year-old, San Mateo, Ca.-based startup that is combining email with chat, has raised $17 in seed(!) funding, including from Salesforce Ventures, Wicklow Capital, SG VC, and individual investors, including Oren Zeev. TechCrunch has more here.
Universal Avenue, a two-year-old, Stockholm, Sweden-headquartered startup that lets companies access a local sales force on demand, has raised $10 million in Series A funding led by Eight Roads, the proprietary investment arm of Fidelity International. Earlier investors Northzone and MOOR also joined the round. TechCrunch has more here.
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New Funds
Veteran Silicon Valley investor Jim Breyer and Chinese firm IDG Capital Partners have raised one of the largest venture-capital funds in China despite concerns that the market for later-stage startups is overheated. The WSJ has more here.
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IPOs
WeWork CEO Adam Neumann, who was interviewed on stage with his wife and co-founder Rebekah Paltrow Neumann yesterday, hinted an IPO may be in the offing. The company has been valued by its investors at $17 billion. Fortune has more here.
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People
Five-year-old mobile events and conferences company DoubleDutch announced yesterday that it will be laying off 55 of its employees as a part of a company-wide restructuring. The company has raised more than $78 million in funding to power its mobile tools which allow event organizers to create dedicated app experiences and easily share information with attendees. TechCrunch has more here.
Yesterday afternoon, before he took the stage at the Fortune’s Brainstorm conference, we sat down with GV CEO Bill Maris in a billowing white tent on the campus of the Aspen Institute, where the conference is being held. We talked about how Brexit impacts GV’s European strategy. (You may recall it has an office in London.) We also asked Maris about some of GV’s newest bets, its biggest bet of all time (Uber), and the decision of one of GV’s highest-profile investors, Rich Miner, to leave the group. More here.
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Essential Reads
Google couldn’t score LinkedIn’s business. But it’s getting LinkedIn’s real estate. Recode has more here.
With new tech, the United Nations is seeking to end hunger Silicon Valley-style.
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Detours
The richest generation in U.S. history just keeps getting richer.
How to negotiate with a liar.
Britain is getting a new leader, but Larry, the Downing Street cat, is staying put.
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Retail Therapy
Smell like a fig candle everywhere you go, if you dare.