StrictlyVC: September 21, 2017

Hi, happy Thursday, all, and L’Shana Tova.

We’re back from Disrupt but now running out the door — please forgive any and all typos. More tomorrow.:)

Top News in the A.M.

Google announced late last night that it is spending $1.1 billion to hire a team of engineers from the smartphone business of the struggling Taiwanese manufacturer HTC in a bid to bring more hardware expertise to its own mobile technology operations. Outsiders are undecided whether the move is a need-to-have or nice-to-have.

Whoa. The SEC said yesterday that hackers penetrated its electronic system for storing public-company filings last year and may have traded on the information.

Sponsored By . . .

StrictlyVC is being brought to you this week by Future Labs AI Summit, a two-day conference comprising trainings, talks, and discussions with leading AI technologists, investors, academics, and entrepreneurs in New York City on October 30 – 31.

From deep dives into key areas animating AI conversations from leading technical experts to introductory courses in machine learning and game theory for AI, the Future Labs AI Summit features offerings for scholars, technologists, and investors alike. Attendees will also get a first look at demos from the second cohort of startups in the AI NexusLab, the accelerator program run by Future Labs, NYU Tandon, and ff Venture Capital. Get tickets here.

Kirsten Green Talks Offline Retail, Catalogs, Celebrity Endorsements and More

Yesterday at Disrupt, Kirsten Green, founder of the early-stage, San Francisco-based venture firm Forerunner Ventures, sat down with us for a quick conversation about her work. Green has become one of the most sought-after e-commerce investors in the country, thanks to bets on companies like Jet.com and Bonobos (both sold to Walmart), Dollar Shave Club (sold to Unilever), as well as numerous popular, standalone brands like Warby Parker and Glossier.

Certainly, her job — funding and helping to grow new, compelling new brands — isn’t as easy as it looks from the outside, despite ongoing disruption to traditional retailers. She noted, for example, that Forerunner is approached by 175 to 200 e-commerce outfits every month, yet last year it made six investments and just nine this year. (There’s “a lot of editing down,” she noted.)

Green also has to manage overlap in her portfolio on occasion, sharing that she has so far navigated potential minefields by talking with her CEOs, though such conversations aren’t always easy.

It “comes down to communication, respecting people and being thoughtful about things,” said Green, adding that she has had “situations where I’ve had that conversation with a founder and we have not agreed” on the threat a potential rival has posed. She said that in one specific instance, she pushed forward with a new deal and, as she’d expected, the companies veered off in different and non-competitive directions. She said the situation ultimately strengthened her relationship with that founder but called cases of overlap in her industry “just life.”

While Green was onstage, we also asked her about Bodega, a San Francisco-based startup founded by ex-Googlers whose nascent business — creating five-foot-wide pantry boxes, filling them with non-perishable items and installing them in gyms and elsewhere — created a firestorm when it launched publicly last week, with many calling its concept insensitive and obtuse.  A Fast Company profile reporting that the team wants to “make mom and pop corner store’s obsolete,” understandably aggravated many who are already worried about the growing wealth disparity between the “haves” in tech and the much larger majority of “have-nots.”

“Certainly, that was a devastating launch for the team,” said Green. “It was not the narrative that they wanted, nor did they think it was the narrative that was consistent with their goals and intentions.”

Perhaps unsurprisingly, Green defended the deal, arguing the team is simply addressing a trend sparked 20 years ago by the launch of Amazon and that has led today to consumers who “want what they want, when they want it, how they want it, and where they want it.”

Explained Green, “Last-mile efficiencies is a big trend. It’s something that consumers have demonstrated that they want and existing businesses are trying to figure out and new businesses are rising up to [address].”

Regarding Bodega, she suggested the idea isn’t to replace corner stores but more or less provide a vastly improved vending machine experience by providing easy access to everyday items to people like college students and apartment dwellers — as well as to make it easier for its customers to track what’s popular, what’s not and how often certain items need to be replenished.

“I think it’s an interesting take on last-mile delivery,” she said. “I don’t think it’s ever going to be practical for someone to drive around and hand-deliver your toothpaste, so how else do we make that an easy experience that’s readily accessible?”

If you run or work for a young e-commerce brand, you might check out our sit-down (you can watch it by clicking through). Green had lots of instructive advice, including on the waning power of celebrity endorsements, the power of offline retail, and why costly catalogs can still make sense.

New Fundings

10x Future Technologies, a 1.5-year-old, London-based startup that wants to help large banks manage data and transactions (and was founded by the former CEO of Barclays), has raised £34 million ($46 million) in Series A funding from the Chinese insurance giant Ping An and the management consultancy firm Oliver Wyman. TechCrunch has more here.

Braze, a six-year-old New York-based maker of business software lifecycle engagement tech (it used to be called Appboy), has raised an undisclosed amount of funding from Meritech Capital Partners, just months after raising $50 million in Series D funding led by Iconiq CapitalMore here.

Clearcover, a 1.5-year-old, Chicago-based car insurance startup, has raised $11.5 million in new funding led by Lightbank, with participation from Greycroft Partners500 Startups, and Silicon Valley Bank. Crain’s Chicago Business has more here.

Digital Shadows, a six-year-old, London- and San Francisco-based digital risk management company, has raised $26 million in Series C funding. Octopus Ventures led the round. Other participants include World Innovation LabIndustry Ventures and earlier backers Passion Capital and Trinity Ventures. Business Insider has more here.

DSP Concepts, a 14-year-old, Santa Clara, Ca.-based company that specializes in microphone processing and playback processing, has raised $10 million in Series A funding led by BMW i Ventures, with participation from Walden International and investor David TsangMore here.

Ever, a four-year-old, San Francisco-based company making facial recognition technology for the enterprise, has raised $16 million in Series B funding led by Icon Ventures, with participation from earlier backers Khosla Ventures and Felicis Ventures. VentureBeat has more here.

Manifold, a 14-month-old, Halifax, Nova Scotia-based startup that’s focused on helping users find, buy, and manage developer services, has raised $15 million in Series A funding from OMERS VenturesBoldstart VenturesVersion One Ventures and Amplify Partners. Techvibes has more here.

MissFresh, a three-year-old, China-based e-commerce platform for fresh produce, has raised $230 million in Series C funding co-led by Tiger Global Management and Genesis Capital. China Money Network has more here.

Pilot Fiber, a three-year-old, New York-based company that’s building its own software to find unused internet fiber, then rewiring much of that infrastructure itself, has raised $17 million in new funding led by Foundry Group in a round that brings its total funding to $32.3 million. Dealbook has more here.

Pointy, a three-year-old, Dublin, Ireland-based startup that helps physical retailers display their stock online, has raised $6 million in Series A funding led by Frontline Ventures, with participation from Vulcan Capital and Draper Associates. TechCrunch has more here.

Tuition.io, a six-year-old, Santa Monica, Ca.-based employer-funded student loan repayment assistance platform, has raised $7 million in Series B funding led by Wildcat Venture Partners, with participation from earlier backers Mohr Davidow Ventures and MassMutual Ventures. TechCrunch has more here.

Vexata, a nearly four-year-old, San Jose, Ca.-based data storage startup, has raised $54 million in funding from MayfieldIntel CapitalLightspeed Venture Partners and Redline Capital. Forbes has more here.

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New Funds

Ubiquity Ventures, a Palo Alto, Calif.-based firm founded by former Bessemer Venture Partners VP Sunil Nagaraj (who has a penchant for space investing), is looking to close on $35 million for its debut fund, shows an SEC filing that states the first sale has yet to occur. (H/T: Axios.)

Exits

Albertsons is snapping up meal kit startup Plated for $200 million.

eShares has acquired the valuation business of Silicon Valley Bank.

Puppet, a 12-year-old, Portland, Ore., company, is acquiring Distelli, a two-year-old, Seattle startup.

Essential Reads

YC seemingly wants to let investors (including unaccredited ones) help fund its startups through the blockchain.

Formerly high-flying Zenefits is trying another reset.

Detours

Wes Anderson’s “Isle of Dogs” trailer.

Johnny Depp in the latest “Murder on the Orient Express” trailer. (We’re in a trailer-watching kind of mood.)

Watch out, Airpods?

Retail Therapy

Oooh. Stay in this Airstream the next time you’re in Malibu.



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