DCM

Blind, An Anonymous Chat App for Employees, Raises Series A Funding from DCM

Tired of being monitored by your company while wanting to dish with colleagues about said company? Or maybe you’re curious about what people with similar work experience are making at other companies? Blind, a two-year-old app founded in South Korea and newly available in the U.S., may be just the thing for you.

Its big idea: bringing anonymity to the workplace so you can “share the real you” with other employees. If you happen to figure out what’s really happening in the upper echelons of the company, so much the better.

Blind’s origins trace back to Naver, the South Korean Internet giant, which long ran a widely used employee forum but pulled the plug when employees began making less-than-flattering remarks about management. When a group of Naver employees left to form Blind, many Naver employees embraced the platform, followed by employees elsewhere.

It’s been growing ever since, says Osuke Honda, a general partner at DCM, which led an unannounced Series A round of “single digit millions” in the company in May. Indeed, he says that another pivotal moment for Blind came late last year, when a senior Korean Air executive exploded in a rage after a flight attendant presented her peanuts in a bag instead of on a dish.

More here.

Quick Chat with DCM’s Jeff Lee

By Semil Shah

Jeff Lee joined the venture firm DCM as a principal last year after running his own business for the previous four years. We caught up with him recently to see how things are going, and what insights into DCM — a 19-year-old firm that invests in the U.S., China, and Japan — he might share.

Most people know Yik Yak but don’t know DCM was an early lead investor. Does DCM like being under the radar in this sense?

At DCM we are very focused on our entrepreneurs. We like our investments to speak for themselves. That said, we also do a lot of deals in China and Japan, where I think we actually are more visible than in the U.S.

What’s happening right now in China that most people in the Valley don’t have a good read on?

Right now there is a huge amount of capital not only in China, but also in Japan, and it’s looking internationally for new opportunities. The major technology companies, “BAT” (Baidu, Alibaba, and Tencent) in China, as well as Rakuten, Softbank, and Recruit Holdings in Japan are actively looking to invest in U.S.-based companies, as well as to acquire startups. Also given that much of the mobile innovation really got started in Asia, startups should increasingly look to Asia as the emerging source of knowledge, capital, and potentially also exits.

How competitive is it for a Series A investor to win a good deal right now? You’re relatively new to DCM — how’s it been in that regard?

There is a ton of capital focused on Silicon Valley right now that has driven valuations to all-time-high levels, as well as increased competition for great deals. I prefer to get to know an entrepreneur ahead of a financing. It not only helps you lean forward on an opportunity, but ultimately helps to build [the kind of] trusted relationship you need to build a great business together.

You spent a good deal of time building your previous company in LA. What are some of the biggest changes you’ve noticed since moving back to Silicon Valley?

Well I did my undergrad at Stanford so in a lot of ways it feels like I’ve come home. I think the biggest difference between L.A. and the Valley is the pace and the feel of the community. Things happen much faster in the Valley because of the competition and size and fast feedback cycles, whereas L.A. has a tight entrepreneurial community because it tends to sit in the shadows of the entertainment industry, as well as Silicon Valley. Also because there are many other core industries in L.A. like entertainment, real estate, and autos and the population is so diverse, the types of entrepreneurs you find are also much more creative. The Valley is like the older, more mature brother of L.A.

If you could share and broadcast one niche area you’re dying to invest in, what would it be and why?

Workflow-enabled marketplaces. Complex tasks like remodeling your home have historically been difficult because they require the coordination of lots of different resources, and there’s frequently not visibility to figure out the right the small business vendors fit the job. These next generation marketplaces not only allow the user to identify the best vendors through reputation built within the system, but also coordinate the delivery of service through the SaaS-like workflow they provide. One thing I really love about these models is they’re network effect businesses that enable underserved markets, much like my prior company Cost Cooperative, which was a group- buying marketplace for small businesses. Addressing large, underserved needs with network effects are two core pieces in building an industry-defining, transformative business.

Yik Yak: The Startup in Twitter’s Rearview Mirror

Yik Yak, an app that acts like a local bulletin board, allowing users within a 1.5-mile range to post to it anonymously, hasn’t received nearly as much press as other anonymous apps, including Whisper and Secret. It’s seeing much more user pick-up, though. As of last night, Yik Yak was the 27th most downloaded free app in the U.S., right behind Twitter, according to app analytics company App Annie. It was also the sixth most downloaded social media app. Twitter was ranked fifth.

The year-old, Atlanta-based company is almost exclusively a college-based phenomenon for now – and very much by design. Indeed, in August, Yik Yak hired 140 campus “representatives” to plaster universities with its marketing materials, a campaign that appears to have been very effective, though Yik Yak doesn’t disclose user numbers.

The question is whether the app makes sense beyond college campuses. Yesterday, StrictlyVC talked with Cameron Lester of Azure Capital, one of the company’s backers, about it. Our conversation has been edited for length.

You found Yik Yak early on. How?

We found it through outbound research. Anyone who spends time with millennials can see their growing lack of interest in the traditional Facebook experience and gravitation to mobile social; as we were forming a thesis around [what’s next], Yik Yak appeared on our radar. We reached out to one of the company’s seed investors who we know and we ended up participating in its [$1.5 million] seed round. When the company was raising a more formal amount — its $10 million Series A, which came together quickly — DCM led the round and we participated in it, investing well above our pro rata.

Yik Yak is taking off on college campuses. Why is that, and can it grow beyond universities, or is that a big enough market?

The advantages to [a college body] are numerous. Yik Yak isn’t offensive relative to some other social media apps that include photos, because from an anonymity perspective, photos create a big problem. The fact that it’s location based, bringing together users in a 1.5-mile radius, also provides a lot of contextual value, particularly if you have a demographic in that range that has a lot of affinity like college students. Yik Yak also [plays into] a big backlash against this concept of [a trackable] online identity. People want the same level of privacy online that they enjoy offline.

In the meantime, we’re already starting to see Yik Yak bleed out into other places. This summer, for example, when people got off campus, networks sprung up on Wall Street, with Goldman Sachs interns bantering with Merrill Lynch interns. The same thing happened on Capitol Hill, with Democratic and Republican interns. And in summer, the user base was a fraction of what it is today.

Yik Yak recently made it possible to peek into other Yik Yak feeds anywhere in the world. That would seem to have a lot of really interesting applications, including for journalists who right now rely heavily on Twitter for breaking news.

Yes, you can now place a pointer on a map of the world and go to Moscow, Hong Kong, Dubai or elsewhere to see what’s going on. It’s pretty crazy. You can’t participate but you can see what’s happening. Basically, American college kids are [introducing it everywhere]. The company’s next phase of growth is urban areas around the globe.

How will the company make money?

Step one is to get to critical mass. But Yik Yak is uniquely positioned to monetize around local affinity. We’re living in sharing economy and all kinds of local services would love access to this kind of user base. You can also imagine sponsorships, local advertising through a model like Sponsored Tweets . . . That the audience is especially local and can be segmented provides unique revenue opportunities.

Yik Yak has already been involved in cases of bullying. To keep the app out of the hands of high school students, who began using it to abuse one another earlier this year, the company had to draw a geofence around nearly every high school and middle school in the country. Do you worry about the liabilities or risk to your brand?

Back in the spring, I had two middle school students – one just went to high school – and all that [bullying] stuff [in high schools] was going down and my reaction was: No way. Then my son came home and said, “They told us about this app that we shouldn’t use.” Then I was really thinking: No. But these founders are white hat guys; they’ve wanted to build something big and useful and benign from the beginning, and they’ve been very proactive about getting bullying and any kind of comments that shouldn’t be there off the system. I think if anything, we’re on the back side of this. I feel like if there was a risk, that’s already been largely alleviated and what we have to do is more of the same.

Made in Japan: Osuke Honda on the Evolving Startup Scene

Osuke Honda is having a good week. In 2010, the DCM partner bet on Kakao Talk, Korea’s biggest messaging app, and on Wednesday, Kakao acquired Korea’s second biggest Internet company, Daum Communications, which was already public. Now the combined company, Daum Kakao, is expected to list on the Korean stock exchange in a couple of weeks with a market cap of roughly $10 billion.

It’s quite a feather in Honda’s cap, though he’s had a pretty prosperous career all along. We talked the other day about his work and, largely, the evolving startup scene in Japan, where Honda was born and lives today. Our chat has been edited for length.

You were born in Japan, but you’ve always been a global citizen.

I was born in Japan but came to the U.S. when I was eight months old because my dad was transferred here. We lived in Houston, then L.A. I went to Tokyo for my undergraduate degree [at Hitotsubashi University], then grad school [at Wharton] in Philadelphia.

Why head to Japan for college?

I always identified as Japanese, but I didn’t really know Japan. I’d spent a month and a half there in the summers, but that was it, and I wanted to know where my family is from. I’d also started doing martial arts when I was 11 and figured if I wanted to get better at Judo, I should go. I figured if I didn’t like it, I’d just come back, but I liked it.

Your first job was at Mitsubishi. What was that like?

Very Japanese – kind of like Samsung in Korea. It was the kind of company everyone wanted to get into. I spent seven years there and was lucky enough to be part of a new organization that in 1999 was [tasked] with figuring out the e-commerce thing in Japan, which Mitsubishi’s CEO recognized was going to be the Next Big Thing.

You were eventually lured into venture capital, first at Apax Globis Partners, then, in 2007, at DCM.

Yes, one deal I was involved in was Gree, the largest mobile gaming platform in Japan, which went public in 2008 and was valued at $5 billion at its market peak. There isn’t a big venture community in Japan and you get to know people, and [during that time, DCM’s] David Chao and I started talking about what we thought was a successful VC model moving forward, which is cross-border [investing]. And we eventually joined forces.

What shifts have you seen in your time as a VC in Japan? Are founders still seen as, well, crazy?

Relative to five years ago, things are changing very quickly for the good.
In the past, raising money in Japan was a challenge. That was one reason people didn’t do startups. But especially because the IPO market has been very good, a lot of corporate VCs are being established. And as [more capital emerges], the mindset of entrepreneurs is changing, too.

Is hiring still a challenge? I sometimes hear that more people are willing to start companies, but that it’s hard to extricate employees from their comparatively safe jobs to work for them.

I think it depends on the sector. When it comes to consumer Internet, I see a lot of folks [joining startups] if there’s a hot entrepreneur involved, especially someone from Google or Rakuten or Yahoo or Gree. They’re very much able to attract smart, capable people.

I noticed you’ve backed a number of people to come out of Google, including Daisuke Sasaki, the founder of the accounting software startup Freee, and Hiroshi Kuraoka, the cofounder of the online bookings company Coubic.

Folks who come out of Google are interesting based on what I’ve seen. Because at Google, they work across offices, their teams tend to follow what’s happening in the U.S. and other regions around the globe and to think: What can we learn from them? That mindset is very important. Also, if you’re a product manager at Google, the way it’s metric driven is a great way to be trained.

Are college graduates thinking about startups right out of school, as in the U.S.?

No. If you go to a top university and ask students what they want to do, they’ll still say they want to work for Mitsubishi. But it’s changing, and growing a company is something that people respect more these days.

Ten or 15 years ago, for example, no one could have imagined that SoftBank would own a carrier. But entrepreneurs like [SoftBank founder Masayoshi] Son are kind of encouraging people that, hey, I can do that, too. They’re looking at the CEOs of [the clothing company] Uniqlo and [e-commerce giant] Rakuten – these self-made billionaires – and getting inspired.

StrictlyVC: March 19, 2014

Good Wednesday morning! We know some of you didn’t receive yesterday’s email; we’re not sure why but here’s a link with our apologies in case you missed it.

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Top News in the A.M.

The hedge fund Fortress Investment Group, along with venture firmsBenchmark and Ribbit Capital, are buying a stake in Pantera Bitcoin Partners, a hedge fund that buys and sells virtual currencies. San Francisco-based Pantera Capital was founded in 2003 by Tiger Management veteran Dan Morehead, who tells Dealbook that in recent months, his 16-person firm has shifted its attention entirely to work on investments in the virtual currency world.

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Google Glass Meets Healthcare with Augmedix

It’s early days for Google Glass, and an almost absurd minefield of challenges lie ahead of it. But that’s not stopping a small number of startups from springing up around healthcare-related applications that can arguably cut costs, provide doctors more time with patients, and improve health outcomes.

Augmedix — a 20-month-old, San Francisco-based startup that’s announcing this morning that it has raised $3.2 million led by DCM and Emergence Capital Partners — calls itself the “first and largest Google Glass startup” focused on healthcare. Its complicated task put simply: It beams electronic health record information to doctors while they’re meeting with patients, so doctors can, say, query someone’s white blood cell counts in real-time without having to traipse back to their computers in the middle of that patient’s visit or in between patient visits.

Whether or not Augmedix is the biggest company focused on turning Glass into a physician’s tool “by every metric,” as its CEO, Ian Shakil tell me, its claims can’t be far off. According to the research firm Datafox, only a handful of startups are dabbling in any kind of Glass-related healthcare applications at the moment, partly because there’s still too much uncertainty about Glass’s widespread uptake, and largely because Glass isn’t protected under federal information privacy rules, meaning that each patient has to give his or her written consent – an effective but inelegant workaround.

So why is Augmedix treading where few startups are ready to go yet? Shakil, who cofounded Augmedix a few weeks after graduating from Stanford Business School (which is also where he met his cofounders), talked with me about it the other day.

You’re announcing new funding but you closed it in August. Why share the news now?

We just wanted to be out of the media’s eye and focus on execution and on hitting more milestones and making more progress before talking to media.

What sorts of milestones can you share? How many doctors are using Augmedix?

We’re selling to large groups of doctors, rather than doctor to doctor, and so far we have several health systems and doctors groups [as customers] and we’re generating revenue. As healthcare continues to consolidate, our job becomes easier because there are fewer people to sell to. Enterprise sales is also the bread and butter of Emergence Capital, so it’s great to have them [as an investor].

How do you address privacy concerns?

Patients don’t walk in the door to see their doctor wearing Google Glass. They’re handed a laminated FAQ and are educated about [the process] and can opt out of having the doctor wear it.

We’ve also created an entirely separate [from Google] cloud-based service that’s on pipes that we control, and we’ve signed business associate agreements with customers, saying, “We’re doing all the [protected health care information] just like other electronic healthcare companies.” We’ve hardened the device in lots of ways, too, such that it’s even more secure than a smart phone in a health care environment.

As a third-party developer, you’re always at the mercy of the platform. How do you mitigate that risk?

I don’t think the risk is as great as some people think. Also, though our materials are all about Google Glass, we’re hardware agnostic; [our tech] also runs on [the Android-based] Vuzix M100. And there are many other smart glass technologies out there, some operating in stealth mode; it’s becoming a competitive space.

I think Glass is the best right now and that it has the best software environment and hardware, so it’s our go-to. But over the long run, I think we’ll be protected no matter what happens.

You have 36 employees working on creating this technology and getting it into physician offices. Is it safe to say you’ll be raising money again soon?

Yes, actually, we’ll look to raise another round, bigger than the amount we’ve raised thus far, later this year.

New Fundings

Aquantia, a 10-year-old, Milpitas, Ca.-based high-speed Ethernet connectivity solution for data centers, mobile and enterprise infrastructure, has raised $16 million in Series G financing led by the programmatic integrated circuit maker Xilinx. The company has garnered roughly $160 million altogether, from investors that include New Enterprise Associates, Greylock Partners, Lightspeed Venture Partners, Pinnacle Ventures and Rusnano.

Blue River Technology, a three-year-old, Mountain View, Ca.-based robotics company that’s using computer vision techniques in agriculture (including to identify and kill unwanted weeds), has raised $10 million in Series A-1 funding led by Data Collective, with participation fromInnovation Endeavors and return backer Khosla Ventures. The company has now raised $13.4 million altogether.

Cloud4Wi, a year-old, San Francisco-based Wi-Fi services company that spun out of WiTech, an Italian company offering managed solutions and services in the telco market, has raised $4 million in Series A funding from the Italian venture firm United Ventures.

Cobrain, a year-old, Bethesda, Md.-based “cross-merchant personalization engine” that aims to present shoppers with the goods of various retailers at once, has raised $3 million in seed funding from a group of unnamed angel investors. Cobrain was founded by CareerBuilder.com founder Rob McGovern.

CorTechs Labs, a 13-year-old, San Diego-based company that develops and markets brain imaging software designed to diagnose a variety of brain disorders, has raised an undisclosed amount of Series B funding from Dragasac, a company incorporated in the Isle of Man.

Glo, an 8.5-year-old, Sunnyvale, Calif.-based LED product developer, has raised $30 million in Series D funding, led by an unnamed new investor. Other participants in the round included earlier investors Wellington Partners, Teknoinvest, Nano Future Invest, Energy Future Invest, Foundation Asset Management, and others. Glo, spun out of Lund University in Sweden, has raised roughly $115 million to date.

Heyo, a three-year-old, Blacksburg, Va.-based social marketing platform designed to help small businesses, has raised $2 million in Series A funding from Valleys’ Ventures, a Radford, Va., investment firm.

Integrated DNA Technologies, a 27-year-old, Coralville, In.-based company that calls itself the world’s largest manufacturer of custom nucleic acid products, has raised a slug of funding from Summit Partners. No terms were disclosed, but the company’s founder, Joseph Walder, remains its majority shareholder.

Nitrous.IO, a 1.5-year-old, Menlo Park, Ca.-based cloud-based developer platform, has raised $6.65 million in Series A funding. Earlier investor Bessemer Venture Partners led the round with participation from investors that included 500 Startups, Crunchfund, Facebook co-founder Eduardo Saverin and Golden Gate Ventures. Nitrous.IO has raised a $1 million seed round last April.

Parchment, an 11-year-old, Scottsdale, Az.-based education credentials technology company, has raised $10 million in fresh funding led by The Raine Group. Earlier investors, including Novak Biddle Venture Partners, Salmon River Capital, GSV Capital and ICG Holdings, also participated. The company has raised $45 million altogether.

Percolate, a three-year-old, New York-based a startup that helps brands figure out what content to create and share on social neworks, has raised $24 million in Series B funding led by Sequoia Capital. Earlier investors GGV Capital, First Round Capital, Lerer Ventures, and ad agency WPP also participated in the new funding. The company has raised $34.5 million to date.

Platfora, a three-year-old, San Mateo, Ca.-based that promises to “mask the complexity of Hadoop,” making it easy for enterprises to understand facts in their business across events, actions, behaviors and times, has raised $38 million led by Tenaya Capital. Citi Ventures, Cisco Systems and Allegis Capital, also participated in the round, alongside earlier investors Andreessen Horowitz, Battery Ventures, Sutter Hill Ventures and In-Q-Tel. The company has raised $65 million to date.

RadPad, a 14-month-old, L.A.-based apartment rental search app, has raised $1 million in financing, including from Deep Fork Capital and Post Investments. The funding brings RadPad’s total funding to $2 million, according to Crunchbase.

Reonomy, a year-old, New York-based commercial real estate technology company that provides investors and lenders with data and analytics, has raised $3.7 million in Series A funding led by SoftBank Capital. Earlier investors Resolute Ventures, High Peaks Venture Partners, KEC Ventures, and FinTech Collective also participated in the round. The company has raised roughly $4.8 million to date.

Simply Measured, a four-year-old, Seattle-based company whose software helps its customers analyze conversations and marketing efforts across major social media platforms, has raised $20 million in Series C funding led by Trinity Ventures with earlier investors Bessemer Venture Partners and MHS Capital participating. The company has raised $28.8 million altogether.

SummitIG, an 18-month-old, Dulles, Va.-based company building a new 170-mile dark fiber route in Virginia, has raised a “large term loan” of unspecified size ORIX Ventures and an equity investment (whose size wasn’t disclosed either) from earlier investor Columbia Capital.

Wedpics, a three-year-old, Raleigh, N.C.-based online and mobile platform that encourages wedding participants to share photos, has raised $1 .5 million in Series A financing led by IDEA Fund Partners. Other participants in the round included Great Oaks Venture Capital, the angel group TAP, and numerous other individual investors.

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New Funds

Australian technology investor and former Microsoft executive Daniel Petre is preparing to launch a $50 million Australia-focused technology investment fund, reports Business Review Weekly. Petre is co-founding the fund with Craig Blair, CEO of Zeebox Australia and a former managing director of Expedia Australia. According to the outlet, the duo plan to invest between $2 million and $5 million in each startup they back.

Ysios Capital, a six-year-old, Barcelona-based venture capital firm, is looking to raise a new, 100 million Euro fund to back early-stage life sciences companies, the firm says in a release. The fund will target companies in Europe and North America and will be the firm’s second vehicle. Its first, the 69 million Euro Ysios BioFund I, was launched in 2008 and has already distributed capital to its investors in each of the last three years, says the firm.

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IPOs

Let the games begin. Chinese e-commerce giant Alibaba will hold the kickoff meeting for its planned U.S. initial public offering on March 25, setting in motion the most high-profile listing since Facebook’s offering nearly two years ago, sources told Reuters yesterday. (The WSJ is reporting that the NYSE is the front-runner right now.)

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Exits

It’s a bit premature to include this in “exits,” but Kior, a publicly traded operator of the first U.S. commercial-scale cellulosic biofuel plant, dropped 39 cents to 65 cents per share at the market close yesterday, after telling regulators it has serious doubts about staying in business. The company, which went public in June 2011 (its shares priced at $15 a piece), just raised $100 million in October from Khosla Ventures and Gates Ventures. Bloomberg has much more here.

AdMobius, a two-year-old, San Mateo, Ca.-based mobile ad startup, has been acquired by Lotame, an independent data management platform, for undisclosed terms. AdMobius had raised $5 million in the fall of 2012 fromOpus Capital and Storm Ventures. Still-private Lotame has raised roughly $50 million over its 7-year history, including from Battery Ventures,Betaworks, Emergence Capital Partners, Hillcrest Management,TrueBridge Capital Partners, Pinnacle Ventures and Sozo Ventures.

Cameo, a video-making app that launched last fall, has been acquired byIAC, with its 14 employees headed over the IAC subsidiary Vimeo. Terms of the deal were not disclosed but the company’s CEO tells Re/code Vimeo will continue running Cameo as a standalone app. If Cameo raised outside funding, it never reported it.

Cenzic, a 14-year-old, Campbell, Ca.based company that makes application security testing technologies, has been acquired by 19-year-old, Chicago-based Trustwave, a broader security testing platform. Terms of the deal were not disclosed. Cenzic had raised $15 million in equity, according to Crunchbase, including from Mohr Davidow Ventures,Hummer Winblad Venture Partners, JK&B Capital and Advanced Technology Ventures.

Vega-Chi, a five-year-old, London-based bond trading platform, has been acquired by the institutional trading network Liquidnet for undisclosed terms. Vega-Chi had raised $3.2 million from Octopus Investments in 2011.

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People

Sam Altman, the newly appointed head of Y Combinator, talks, a lot, notes Re/code in new profile of the 28-year-old. Writes reporter Liz Gannes: “If you ask anyone who knows Altman, from former employees to investors to mentors to mentees to friends, they’ll mention his perpetual availability — the way he seems to reach out every day, multiple times per day, on the phone or email or text or instant messenger. Altman estimates he keeps in close touch with ‘low hundreds’ of people on a daily basis.”

Venture capitalist John Doerr has cashed out more off his Googleholdings. On Monday, while you were eating Irish soda bread, he was unloading 3,497 shares on the open market for a total haul of $4.2 million. In late February, Doerr, who reportedly now directly owns just 2,522 shares in the company (value: approximately $3 million), sold 11,774 shares of the stock for a total value of $14.2 million. He also sold roughly $4 million worth of shares in mid-December.

Marc Whitten, chief product officer of Microsoft‘s Xbox division, is leaving to become the chief product officer of the 12-year-old, wireless audio company Sonos. Geekwire looks at what the move means.

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Job Listings

Facebook is looking for a director of global mobile partnerships at its Menlo Park, Ca., headquarters.

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Data

Inspired by investor Hunter Walk’s post, “New Grads: Midstage Startups Are Your Best First Job in Tech,” Datafox has compiled a list of 45 companies that are Series B and C funded, less than 10 years old, and experiencing what the research firm calls “significant traction.” You can check out its findings here.

How hot are investors on the Internet of Things ecosystem? CB Insights says financings in related startups grew each successive quarter of last year, hitting an eight-quarter high in the fourth quarter. Altogether, VCs plowed $1.1 billion into 153 deals, according to the firm.

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Essential Reads

Fund of funds Paul Capital is winding down its portfolio and shuttering all but its San Francisco office after a planned sale to Hamilton Lane collapsed. As much as $300 million of open commitments will be returned to investors, sources tell the WSJ.

Google is in hot water for scanning millions of students’ email messages and allegedly building “surreptitious” profiles to target advertising at them.

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Detours

More than a dozen neurotoxins cause behavioral and cognitive problems. Eek. Here they are.

Night-vision contact lenses might be a thing soon.

What the world eats for breakfast.

GQ meets the people at Buzzfeed who curate all those super adorable pet slideshows you occasionally click through. (We won’t tell anyone.)

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Retail Therapy

Woolpower sweaters. Good enough for the Swedish army.

We also love Oliver Gal, for affordable wall art that won’t remind you of your (fun but gross) college apartment.

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Google Glass Meets Healthcare in Augmedix

You’re announcing new funding but you closed it in August. Why share the news now?

We just wanted to be out of the media’s eye and focus on execution and on hitting more milestones and making more progress before talking to media.

What sorts of milestones can you share? How many doctors are using Augmedix?

How do you address privacy concerns?

Patients don’t walk in the door to see their doctor wearing Google Glass. They’re handed a laminated FAQ and are educated about [the process] and can opt out of having the doctor wear it.

As a third-party developer, you’re always at the mercy of the platform. How do you mitigate that risk?

I think Glass is the best right now and that it has the best software environment and hardware, so it’s our go-to. But over the long run, I think we’ll be protected no matter what happens.

You have 36 employees working on creating this technology and getting it into physician offices. Is it safe to say you’ll be raising money again soon?

Yes, actually, we’ll look to raise another round, bigger than the amount we’ve raised thus far, later this year.

DCM Reboots with a New Fund and Three Fewer GPs, Including Dixon Doll

In case you haven’t noticed, the global, early-stage venture firm DCM has been killing it in recent years. Since 2009, 15 of its portfolio companies have exited, many through highly successful IPOs. For example, DCM owned 20 percent of the China-based online retailer VIPshop when it went public in 2012 with a market cap of $600 million. Today, the company is valued at $8.7 billion.

Eighteen-year-old DCM, which invests in the U.S, China, and Japan, doesn’t appear to be resting on its laurels. This morning, the firm is announcing its seventh, $330 million, venture fund. It’s also disclosing that longtime general partner Carl Amdahl and general partner and cofounder Dixon Doll will no longer be investing in new companies on behalf of the firm, a plan that has been in the works for several years, says general partner Jason Krikorian. (A third general partner, Gen Isayama, who opened DCM’s office in Tokyo in 2009, left last year to launch a new fund, which StrictlyVC wrote about in January.)

On Tuesday, I chatted with Krikorian about the latest developments at the firm. Here’s part of that conversation, edited lightly for length.

DCM clearly could have raised a bigger fund. Why didn’t it?

For a few reasons. First, it has to do with where we think the sweet spot is, meaning the amount of money that [early-stage] investors should manage, and we think it’s between $50 million and $60 million per GP. [Editors note: DCM now has six active GPs.]

This new fund also marks a bit of a transition for Dixon and Carl and it’s important for LP relations to have a long-planned out transition period; it’s part of the reason I was brought in [in 2010]. Also, it’s very tempting for funds to get bigger, but we think small teams operate better.

DCM invests in three geographies. Which of them attracts the most of the firm’s capital?

In the past, it’s really been balanced, with half in the U.S. and half in Asia, which is still dominated by China. Our returns in Japan have been good but there are far fewer startups to see; Japan still has a big company culture, so the best and brightest still go that route.

You raised your sixth fund in 2010, but you assembled a couple of other side vehicles around the same time, right?

Yes, we had raised [DCM VI] when I first joined, and we created two other funds simultaneously. One was an RMB (yuan) fund that primarily focused on later-stage China investments that we’d invested in [and wanted to back again]. We used that, for example, to invest more in both VIPshop and 58.com. It was a fund that we invested at basically $15 million a pop.

The other fund was an Android fund that was backed by Asian-based corporates in China, Japan and Korea that viewed Android as a significant global opportunity. Some of the key LPs of that fund are [the Chinese investment holding company] Tencent, KDDI [which is one of Japan’s largest mobile phone operators], and NHN [which owns one of the largest search engines in South Korea].

That fund has also been really great and given us a lot of flexibility to do deals where we put in a few million dollars at a valuation in the high, double-figure millions, including [South Korean messaging company] Kakao, which now has something like 95 percent penetration of the [regional] population. [Editor’s note: The WSJ recently reported that the company is talking with bankers about an IPO that would value it at $2 billion.]

Will we see you raise similar side funds this time around?

There’s interest [from LPs] as you might imagine, but we don’t have any definite plans to do [either]. We kind of view this new fund as a consolidation of those efforts.

You had a personal win this week with the wearable device maker Basis, the first deal you led for DCM. How has the wearables and hardware space changed in the three-plus years since you made that investment?

There’s a perception that this is a great time for hardware companies, and I think it’s true. There’s a more cooperative supply chain, [booming] capital markets, and a more favorable marketing environment with social media and blogs, so word gets out about great products.

But I still think VCs are primarily funding the aggressive growth of the guys who’ve really broken out, so Fitbit, Jawbone, Nest. I still think there’s a lack of comfort around funding early-stage hardware companies pre-launch…because [a device] isn’t a Web service that can be tweaked. For instance, we backed Whistle [a health monitor for dogs] and 20,000 units just moved onto the shelves at [pet retail giant] Petsmart, and they have to work.

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Will Alibaba Draw VCs Back to China?

Although the American financial press seems preoccupied with Twitter’s impending IPO, Alibaba’s IPO could be an even bigger story. The China-based e-commerce juggernaut, which could go public as early as the first quarter of 2014, racked up revenues of $1.38 billion for the quarter ended in March, and analysts estimate that the company could be worth anywhere from $120 billion to $200 billion. (Facebook’s market cap as of this writing is $125 billion.)

As the Alibaba offering approaches, one can’t help wondering why U.S. investors have had so much trouble capitalizing on Chinese tech IPOs.

Although Yahoo remains among one of Alibaba’s biggest shareholders – with a 24 percent stake, half of which it plans to sell at the IPO – Alibaba has few U.S. investors other than GGV Capital, an expansion-stage firm on Sand Hill Road that invested in Alibaba in 2003; and Silver Lake, the private equity firm, which reportedly invested $300 million in Alibaba in 2011. (Japan’s Softbank owns 35 percent of the company; Alibaba’s founders and senior executives own another 13 percent.)

American tech types have tried repeatedly to capitalize on the country, but factors like partner defections, accounting scandals committed by China-based companies, and a slowdown in the country’s GDP growth rate have yielded disappointing returns.

Still, success will only come if a firm is willing to stick it out and take the time to forge relationships within China’s close-knit entrepreneurial community, says David Chao, co-founder and general partner of DCM, the early-stage venture firm.

Since 1999, DCM has backed more than 200 companies across the U.S. and China, and three of its most recent IPOs are China-based companies, including Renren, Dandang, and Vipshop. (DCM owned 20 percent of Vipshop went it went public last year with a market cap of $600 million; today it’s valued at $3.2 billion.)

Last week, DCM scored another China-based investment win when Kanbox, a personal cloud storage service that is often likened to Dropbox, was acquired by Alibaba for an undisclosed amount.

Pointing to a separate, recent deal – the Beijing-based search engine Baidu’s agreement to pay $1.9 billion for China’s popular smartphone app store 91 Wireless – Chao says that it’s actually becoming easier for savvy investors to generate returns.

“Five years ago,” he observes, “almost all successful Internet companies were destined to go public. Now that you have a second generation of successful Internet companies going public — large cash companies,” Internet investors can expect exits through M&A, too.

Other shifts Chao has witnessed include an “angel investor boom in the last year that will probably continue for a while,” and less copycat tech and more innovation, particularly when it comes to smartphones and mobile social networks. (Chao characterizes several companies as “way ahead” of anything we’ve seen in the U.S.) “What we’re seeing isn’t a 180-degree shift,” he adds, “but 10 years ago, 99 of 100 business plans were largely focused on being analogous counterparts to successful U.S. or Japanese Internet companies; today, that number is maybe 80 out of 100.”

I ask Chao if it’s too late for firms that still haven’t made a foray into China — as well as whether he thinks U.S. investors have the intestinal fortitude to stick it out. Will Alibaba be the company that refocuses their attention?

“It’s more difficult than it was 10 years ago” to enter the market, Chao notes. But plenty of venture brands are still being established in China, he says. Succeeding in China is all about the long game, he suggests, but “a firm can make its name in very quick order.”

Photo: Courtesy of AFP/Getty

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