Hi, happy Wednesday.:)
Top News in the A.M.
Less than a week after an explosive report emerged about the predatory behavior of Justin Caldbeck, cofounder of Binary Capital, the firm is being shut down, for all practical purposes. Bloomberg, which has the news here, said last night that LPs would likely either sell off all the firm’s current portfolio stakes, allow remaining cofounder Jonathan Teo manage them, or assign their management to another venture firm. In an update this morning, however, Teo has just offered to resign from both funds. It could be for reasons that aren’t publicly apparent (yet). Another possibility: a growing number of Binary’s startups seem to prefer breaking all ties. One of them, Assist, said last night that they’ve asked to buy back Binary’s stake in its business.
Axios yesterday published a related report on Lightspeed Venture Partners, which previously employed Caldbeck, and it’s not going to win the powerful firm many new fans. According to Axios, Lightspeed removed Caldbeck from a board observer seat several years ago after Katrina Lake, cofounder and CEO of the e-commerce company Stitch Fix, complained about him. Alas, when Lake began talking with Benchmark Capital about her next round of funding, Lightspeed had Lake sign a non-disparagement agreement, effectively silencing her. A year later, Caldbeck cofounded Binary Capital.
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While Most Investment Firms Ponder ICOs, This Outfit is Barreling Ahead with a $100 Million ICO Fund
Most investors are trying to get a handle on initial coin offerings, which have begun racing through the tech ecosystem like a fire, veering off in multiple directions and causing excitement and confusion and some degree of terror as they grow in number.
In the simplest terms, the offerings enable startups to create their own digital currencies and sell them to users who can either redeem them later for the startups’ services, or sell them on a coin exchange at a later date.
Because the offerings are unregulated, most venture capitalists remain wary of them, even as their very line of work suddenly looks threatened. (Why sell equity to an investor when your customers are willing to throw money at you?)
However, one San Francisco-based firm is barreling full steam ahead into the world of ICO investing: Pantera Capital, founded 14 years ago by Tiger Management veteran Dan Morehead, whose team was among the first to launch funds focused exclusively on bitcoin and other digital currencies.
That Pantera is again chugging past its peers into territory they view as uncertain isn’t surprising. (Pantera has done pretty well with bitcoin, which it began buying when the currency was valued at $65. Today, one bitcoin is valued at roughly $2,500.) Still, the size of its newest fund — which has already garnered $35 million and Pantera expects to close with $100 million by summer’s end — seems like an outsize gamble, even for the gun-slinging outfit.
To learn more, we talked yesterday with Morehead, Pantera partner Paul Veradittakit and new hire Joey Krug, who previously co-founded Augur, a decentralized prediction market platform that raised $5.3 million in an ICO in 2015 — long before the rest of us had ever heard the term.
New Fundings
Cabin, a year-old, San Francisco-based hospitality transportation company (it operates buses with private cabins and other luxuries for regional travel, including from San Francisco to L.A.), has raised $3.3 million in seed funding. The round was led by Founders Fund, with participation from SV Angel, Floodgate, Box Group, Brainchild Holdings, Justin Rosenstein, StartX, FJ Labs, and 1517 Fund. More here.
Clique Media Group, an 11-year-old, L.A.-based fashion startup that is part media company, part consumer product house, has raised $15 million in Series C funding co-led by Greycroft Partners and e.ventures. Recode has more here.
Kry, a three-year-old, Stockholm, Sweden-based digital health startup, has raised $23 million in Series A funding led by Accel Partners in London, with participation from Creandum, Index Ventures, and Project A. More here.
Lazada, five-year-old, Bangkok-based online shopping and selling destination that’s reportedly Southeast Asia’s number largest, has raise $1 billion in further funding from earlier backer Alibaba Group, which now owns 83 percent of the company. Bloomberg has more here.
LendUp, a 5.5-year-old, San Francisco-based online lending company that says it helps the underbanked develop better credit, has received an undisclosed amount of strategic funding from PayPal. According to Crunchbase, the company had previously raised at least $360 million in equity and debt funding. TechCrunch has more here.
Wonder, a two-year-old, Venice, Ca.-based mobile company that’s been operating in stealth mode since its launched, has raised an undisclosed amount to Series A funding led by Grishin Robotics and TCL Communication Holdings. The round brings the company’s total funding — including from Kevin Spacey, Shakira, Greycroft Partners and 8VC — to $14 million. TechCrunch has more here.
Xometry, a nearly four-year-old, Gaithersburg, Md.-based on-demand manufacturing platform, has raised $15 million in funding led by BMW i Ventures, with participation from earlier backers GE Ventures and Highland Capital Partners. More here.
New Funds
Benhamou Global Ventures, an early-stage venture capital firm that focuses exclusively on enterprise investments, says it has closed its third fund with $80 million in commitments from existing LPs, as well as new international and institutional LPs that include several U.S., European, Israeli and Chinese investors. More here.
Google today is more formally taking the wraps off its internal incubator, Area 120. More here.
Verizon Ventures, the corporate venture capital unit of Verizon, has established a new arm in Tel Aviv called Verizon Ventures Israel. The group, which isn’t disclosing how much capital it has to use, is being headed up by Merav Rotem-Naaman, the former Head of Nautilus, AOL’s Israeli investment and scouting arm. It will back both early- and late-stage companies. More here.
IPOs
Blue Apron just slashed its price range target (by a lot).
People
The Democratic National Committee has tapped Raffi Krikorian, a former top engineer at Uber’s self-driving-car program, to be its next chief technology officer. The idea is to create tools to reach more voters. Recode has more here.
Speaking at the annual Stanford Directors’ College yesterday, former Yahoo CEO Marissa Mayer defended ousted Uber CEO Travis Kalanick, suggesting he was unaware of the toxic culture brewing at Uber because of the company’s rapid growth. The San Francisco Chronicle has more here.
Joshua Newman, a fitness entrepreneur who was raised in Palo Alto and previously ran a venture fund that provided backing to startups founded by college students, was just sentenced to 41 months in prison for using money he’d raised for a new venture for his personal use. Dealbook has more here.
Essential Reads
ProPublica on Facebook’s secret censorship algorithm: it protects white men more than black children.
That malware attack is still spreading.
Detours
What it costs to open a restaurant in San Francisco.
Nike’s cofounder says not even Tiger Woods could make golf profitable.
Retail Therapy
No.