SparkLabs Global Ventures’ Technologyand Internet Market Bi-Monthly Review March 16th, 2015 Bi-monthly Highlights Global Trends • Fewer venture capitalists are betting on game companies The game-making business is risky, and that’s led to less capital available for startups in recent years. Investment in gaming has dropped 7 percent in the first quarter of the year, according to advisory firm Digi-Capital. That’s on top of a capital market that has already declined 25 percent from 2011 to 2014. Total investment in games from venture capitalists was US$1.4 billion over the 12 months leading up to the end of March. The problem is that the partners at most firms are risk-adverse, and it’s difficult trying to predict where to put money in a hit-based industry. While people making specific games for console and PC are struggling to find financial backers, it’s not nearly as bad for companies building tools that a lot of other studios use. VCs are willing to take a chance on something that could turn into an industry standard. But beyond the tech, mobile is still getting the most attention. And that’s primarily coming out of Asia. Strategic investors in China, Japan, and South Korea are all putting cash into mobile developers and tech companies geared toward that part of the world. • The Trends Creating New Winners And Losers In The Card-Processing Ecosystem The payments industry had a huge year in 2014 and it's showing no sign of slowing down. On the one hand tech giants like Amazon and Apple released new products that affirmed their long-term payments ambitions (Apple Pay and Amazon Local Register). On the other hand startups such as Stripe and ShopKeep continued to carve out market share, challenging older players like PayPal and VeriFone. Understanding this complex and rapidly evolving space can be challenging. The ecosystem for credit- and debit-card processing involves a complicated set of players interacting to process every transaction. The mobile point-of-sale (mPOS) is going to have a massive impact on the payments-hardware and payments-software industry. By 2019, we forecast that nearly 80% of US retailers will have implemented a mPOS device. The move to mPOS will continue to put pressure on hardware providers that compete directly against mPOS devices, as well as ISOs that sell legacy devices to merchants. • E-sports makes US$612M from its 134M viewers worldwide, SuperData finds Young guys with a lot of money are watching e-sports, and this is turning it into a market of its own. Competitive gaming is a US$621 million business, according to intelligence firm SuperData Research. That money primarily comes from Asian markets like South Korea and China, where the e-sports scene is huge and has an established history of success. But it’s also growing in Europe and North America thanks to popular games like League of Legends, Dota 2, and Counter-Strike: Global Offensive. In addition to the money, e-sports fans around the world number in the 134 million range. But even as more money and people pour into this space, SuperData founder and chief analyst Joost van Dreunen argues that it is still a marketing tool for publishers before anything else. SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul. 1 SparkLabs Global Ventures’ Technology and Internet Market Bi-Monthly Review March 16th, 2015 Asia Pacific China • The face recognition startup raises US$25M in funding Face++, a face recognition tech startup from Beijing, announced that it raised an additional US$25 million as part of its series B round that began in November last year. The fresh funding brings the company’s series B to a total of US$47 million. Innovation Works and Ignition Partners contributed to the initial funding, while the more recent investors have not yet been disclosed. Face++ makes a cloud-based API and an SDK so developers can incorporate face recognition into their own apps. The startup has over 30,000 developers using its technology. Besides password replacement and payments, Face++ is currently looking into intelligent video analysis, retail applications, and security. • Alibaba founder Jack Ma leads US$128M investment in live-streaming sports site LeTV Sports, an affiliate of online video portal and smart TV maker LeTV, has raised US$128 million in series A funding. The investment was led by two of China’s most prominent billionaires, Alibaba founder and chairman Jack Ma and Wanda Group chairman Wang Jianlin. Each man invested via his private venture capital fund, Yunfeng Capital and Wanda Investment, respectively. Fortune Link, Prometheus Capital, and several others also participated in the round. As a result, LeTV Sports has reached a valuation of US$452 million. LeTV Sports is an online video site that focuses on live streaming sports events. It claims to broadcast 4,000 matches of 12 different sports every year, including soccer, basketball, tennis, and golf. It has acquired exclusive rights to broadcast a handful of events. The company established a US$200 million film production fund and acquired a production studio for US$260 million to generate more exclusive content. • Chinese companion ‘robot’ AI Nemo raises over US$10M series B Chinese tech site Lieyunwang is reporting that A.I. Nemo, a Chinese startup that produces what it calls a “robot companion” for homes, has raised a series B round in excess of US$10 million. The precise sum of the round and its investors have not been disclosed, but previous investors in the company include Innovation Works and Lightspeed China Partners. A.I. Nemo is a hardware startup that produces what it calls a smart robot companion. In actuality, it’s basically a small desktop computer with a very nice webcam and some automated panning abilities. The idea is that you put the thing – which costs US$370 – in your home and it’ll help you communicate with family members even when you’re not there. Users that aren’t at home can control the device through a mobile app, and will receive notifications from it on the app. • Chinese travel site Tuniu gets US$500M injection, JD now biggest shareholder Tuniu, a NASDAQ-listed Chinese travel and tourism site, announced that it has secured a US$500 million investment led by ecommerce giant JD. JD will purchase US$350 million worth of shares in Tuniu, with the rest divided between Hony Capital, DCM Ventures, Ctrip, Temasek Holdings, and Sequoia Capital. The deal is expected to close sometime in the current quarter. Ctrip, JD, and Hony in December contributed to a US$148 million injection into Tuniu. JD is now Tuniu’s largest shareholder with a 27.5 percent stake. JD is Alibaba’s closest rival in China. As part of the deal, Tuniu will be more closely integrated into JD’s online marketplace, according to a statement by the ecommerce company. It also means Tuniu will “operate, for five years without commission, the leisure travel channel for both JD.com’s website and mobile app, and will become JD.com’s preferred partner for hotel and air tickets booking services.” • Dubbed the ‘Model T’ and ‘Apple’ of drones, China’s DJI rakes in US$75M funding Shenzhen DJI Technology, the world’s biggest make of consumer and prosumer aerial drones, announced a US$75 million investment from Accel Partners. Now valued at US$10 billion, it’s the undisputed champ both in sales revenue and in market cap. Accel’s injection values the company at US$8 billion, but the company is reportedly in ongoing negotiations that will raise its valuation even further. DJI expects to sell US$1 billion worth of drones this year, up from US$130 million in 2013. Previous investors include Sequoia Capital, but the company has taken in relatively little funding up to this point. DJI released the latest model in its popular Phantom line last month. The Phantom 3 sells for US$1,259 and US$999 for the Pro and Advanced versions, respectively. • Chinese real estate site Aiwujiwu closes US$120M series D Shanghai-based real estate startup Aiwujiwu continued its whirlwind year of funding with the announcement of a series D round worth US$120 million. Investors in the round included GGV Capital, MorningSide Ventures, Shunwei SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul. 2 SparkLabs Global Ventures’ Technology and Internet Market Bi-Monthly Review March 16th, 2015 Capital, and Banyan Capital. Aiwujiwu is a rental and second-hand home listing portal and transaction platform. The site allows for easy location-based visualization and searches, and many of its listings include video tours. It acts as a kind of virtual agent, allowing you to do things like book visits via your smartphone. Aiwujiwu charges a 1% commission for home sales, but its rental services are free. Aiwujiwu is a relatively new platform but funding has come thick and fast, with undisclosed series A, B, and C rounds all having been closed within the past year. Korea • Apora Ventures Launches ‘Accelerate Korea – Berlin’,With Full Program Subsidies provided By KISED Accelerate Korea – Berlin is a new four stage Acceleration Program for Korean startups beginning 1 June 2015. It is a specialized Cross-border Incubator & Accelerator Program designed to significantly increase the chances of a Korean Startup’s success in Berlin, Germany. It equips Korean startups with the knowledge and experience for global acceleration in Korea, followed by a comprehensive Overseas Immersion Program in Berlin. Accelerate Korea – Berlin will be hosted by Apora Ventures, an early-stage-investment firm headquartered in Amsterdam, with full funding provided by the Korean government through KISED. Apora Ventures supports innovative, early-stage tech startups from its base in the Netherlands. It boasts a global network of mentors and support services across the world, with Google, Amazon, and many other industry key leaders as official partners. Japan • Paidy raises additional US$5M to give online shoppers instant credit Exchange Corporation (ExCo)’s Paidy service allows ecommerce shoppers to buy now and pay later without a credit card. The Tokyo-based fintech startup announced that it has expanded its series A funding by US$5 million, bringing the total to US$8.3 million. To make an online transaction, Paidy users simply share either an email address or their mobile phone number. The startup guarantees the payment to the merchant and bills the purchaser about two weeks later, assuming all risks involved like a traditional credit card company. Also similar to plastic is the option to break payments into monthly installments. The startup charges a flat 3 percent fee to the merchant, in line with competing credit card rates. • Japan’s GMO announces US$18M startup fund GMO Internet is perhaps the biggest Japanese tech company largely unknown outside of its home country. In its first quarter earnings report, the firm revealed a growing interest in expanding its overseas business, in part by establishing a new US$18 million startup fund. The fund, to be operated by GMO Venture Partners, a subsidiary of GMO Internet, is the fourth such fund created by the company. Already, it has made investments into ex-Line CEO Akira Morikawa’s new video startup and Slack competitor Chatwork. The new fund has an international tinge. GMO Venture Partners wants it to “support Japanese startups aiming to launch in the North America and Asia markets.” This dovetails with an international expansion theme that the parent company established in its earnings release today. Behind the Z.com domain name, GMO is aiming to raise its overseas revenue percentage from the current three percent. • ChatWork, a year older than Slack, raises US$2.5M for team chat and collaboration tool ChatWork, an enterprise social network, announced that it has raised US$2.5 million from GMO Venture Partners (GMO VP). It marks the first investment in the startup, which is based in Japan and California. ChatWork was an early mover in the team chat and productivity space, recently abuzz thanks to Silicon Valley rival Slack and its nearly US$2.8 billion valuation as of last month. While Slack has been a hit with startups, ChatWork positions itself as a communication tool for non-technical business professionals and small-to-medium enterprises (SMEs). This investment is the second from GMO VP’s newly established Fund 4, with the first going toward former Line CEO Akira Morikawa’s video curation startup C Channel. The funding will be used for product development, hiring, and expansion to the US and Europe. India • Toppr bags US$10M to help its students top entrance exams in India India has the highest number of students in the world. Over 253 million students are enrolled in schools across the country. Yet when it comes to e-learning, the present offerings in the country leave a lot to be desired. And classic classroom education is expensive. Toppr wants to change that. It provides a subject learning platform for middle school and high school students preparing for the entrance examination for the Indian Institute of Technology (IIT) and medical entrance exams. It has announced a series B funding round of US$10 million led by Fidelity Growth Partners India. Its existing investors SAIF Partners and Helion Ventures, who had earlier invested US$2 million in SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul. 3 SparkLabs Global Ventures’ Technology and Internet Market Bi-Monthly Review March 16th, 2015 Toppr, participated in the round. The startup had recently acquired its rival EasyPrep, a customized exam paper creation platform for schools, coaching institutes, and teachers. • India’s Vedantu bags US$5M to give students specialized teachers from anywhere In India, students often feel too shy to clarify their doubts in a crowded coaching classes. Many students travel long hours to get to class. Bangalore-based Vedantu wants to break these shackles by liberating learning and teaching from the limits of location. It has developed tools to give live online tutoring sessions through in-built whiteboard, audio, and video technology. The company announced that they have raised US$5 million from Accel Partners and Tiger Global in series A funding. With fresh funding, the startup will create a system where a student can choose a suitable teacher in real time. Vedantu, a six-month-old startup, caters to students from grade six to 12. Besides monthly tuitions, it provides test prep coaching for competitive exams like National Talent Search Examination (NTSE), International Mathematics Olympiad (IMO), and Joint Entrance Exam (JEE). • Logistic services firm Delhivery raises US$85M to ride on India’s ecommerce boom Riding on the back of an ecommerce boom, India-based logistics service Delhivery raised a series D round of US$85 million led by Tiger Global Management. Last year, the company received US$35 million from Multiples Alternate Asset Management, Nexus Venture Partners, and Times Internet Limited. These investors have also participated in this round. This has so far been the biggest deal for an ecommerce support venture in India. Delhivery has a range of proprietary commerce technologies that they’ve built in-house to tackle logistics problems. With the funding, it plans to tap into India’s rural market and build 2.5 million square feet fulfilment centers. The startup aims to expand its reach four-fold. Delhivery is also expected to invest heavily in expanding the senior management team. It has recently appointed Sandeep Barasia, senior partner of Bain and Company and Suraju Dutta, ex-FedEx executive, as managing directors. • Red Polka raises seed round to help ladies avoid fashion faux pas A Mumbai-based online fashion and lifestyle curation portal RedPolka has closed its first round of angel funding and raised US$250,000 with the help of five angel investors. The online portal provides a platform for sellers to showcase their designs to a targeted audience. Brands sign up with Red Polka for a fee to reach out to women shoppers, and Red Polka takes a commission of sales. Red Polka’s competition includes Bangalore-based fashion discovery startup Wooplr, which recently closed a series A round of US$5 million from Helion Ventures. Roposo, a Gurgaon-based startup, is also a major player in this space. Tiger Global recently invested US$5 million in it. The startup was founded in January 2015 by Vishakha Singh, a marketing and brand-management professional. Red Polka employs a team of in-house curators, content writers, relationship managers, and techies. It’s also hiring people with specific skill sets like artificial intelligence. • India’s BedBathMore buys marketplace of interior designers to go beyond home furnishing India’s BedBathMore, an online shopping portal in the home furnishings and lifestyle segment, announced that it acquired Homado, a marketplace for interior designers. The deal size remains undisclosed. With this, Homado’s eight member team including founders Anupam Sinhal and Vikas Chaudhary will join BedBathMore. Homado’s 3,000 architects and interior designers have been integrated into the existing offerings of BedBathMore. It aims to onboard 10,000 more this year. The nine-month-old startup is at a pre-revenue stage. BedBathMore also announced its plans to go beyond ecommerce and turn into a community. In its new avatar, the consumer’s interaction with the lifestyle brand will begin with curated content on home décor, created by a team of editorial experts, as well as engaging user generated content. • Meet India’s Airbnb for small offices that just raised funding MyCuteOffice, India’s Airbnb for desk space and offices, just raised seed funding from angel network Lead Angels. The deal size is not disclosed. With fresh funding, the four-month-old startup aims to launch a mobile app to book offices on the go. The startup is a marketplace for sharing vacant work desks, offices, studios, and meeting facilities for small businesses in six Indian cities including Mumbai, Delhi, and Bangalore. It gives businesses more flexibility by offering space rentals on an hourly, daily, or monthly basis. While searching for space on MyCuteOffice is free for office seekers, the company makes its revenues from space providers who pay a fee of 10 percent of the rental value. The startup also assists in registration of offices in Mumbai for US$15.6. MyCuteOffice claims to have served 400 users. • India’s Uniphore raises funding from Infosys founder to ease man-machine communication SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul. 4 SparkLabs Global Ventures’ Technology and Internet Market Bi-Monthly Review March 16th, 2015 Uniphore, a Chennai-based speech recognition startup, announced that it nabbed a series A round of funding led by Infosys founder Kris Gopalakrishnan. The company had earlier raised funding from early stage VC fund IDG Ventures India, Indian Angel Network, YourNest Angel Fund, among others. Uniphore provides voice biometrics, a virtual assistant, and speech analytics solutions to enterprises. These allow any software application to understand and respond to natural human speech. It is serving customers from industries like banking, insurance, outsourcing (BPOs), agriculture, and healthcare. The startup claims to have worked with over 70 enterprise customers and served over 4 million end users. It has offices in India, the Philippines, and the UAE. The fresh funding will be used for global expansion and product and technology development plans. • PropTiger acquires rival as India’s online property startups boom Real estate search and booking portal PropTiger announced that it has acquired rival listing firm Makaan for an undisclosed sum. Makaan is a real estate classifieds firm for buying, selling, and renting. It claims to have around 200,000 active property listings from 40,000 brokers in 50 Indian cities. PropTiger on the other hand provides services like property search, site visits, home loan advice, and assistance in the final registration of property. PropTiger claims to have sold 12,000 homes worth US$1.2 billion through its platform. It has a team of over 500 people including engineers, product experts, and property advisors in eight major Indian cities. The company also provides real estate consulting and data services to institutions such as real estate developers, private equity investors, and banks. Indonesia • aCommerce snaps up US$5M in preparation for series B round One of Southeast Asia’s largest ecommerce service providers aCommerce announced that it raised a bridge funding round of US$5 million, oversubscribed by existing shareholders. Investors in the round included Ardent Capital, Indonesian conglomerate Sinarmas, and Inspire Ventures. According to the firm, the funding round is in preparation for a larger series B round set to take place in the second half of 2015. aCommerce previously raised US$10.7 million in June 2014 – one of the largest series A rounds on public record in Southeast Asia. The fresh capital for aCommerce will be used to ramp up areas in all three of its divisions: marketing, tech, and warehouse space. As a result, the Indonesian team is expected to exceed 300 staff. Taiwan • Taiwan’s iChef discloses US$1.5M funding round from supermarket mogul iChef, the Taipei-based startup that offers an iPad-enabled POS (point-of-sales) service for restaurants, has disclosed a US$1.5 million investment from Lin Ming-Hsiung, chairman of Pxmart, one of the island’s biggest supermarket chains. While the round was closed last July, the company has not made it public until now. Pxmart’s current CEO Hsu Chung-Jen also contributed to iChef’s seed-size round, but the company says it has no formal ties to the food vendor. iChef is a POS app that Chen and three other co-founders built to serve the island’s new class of business-savvy restaurateurs. Since its launch in 2012, Chen claims that iChef has scored more than 500 clients in Taiwan, the overwhelming majority of whom are pay for it via monthly subscription fees. Philippine • Rappler gets funding from top media veterans led by Marcus Brauchli Rappler, an independent social news startup in the Philippines, has secured funding from an investment firm led by Marcus Brauchli, who held top positions at the Washington Post and Wall Street Journal. Rappler is among the first in the region to receive capital from North Base Media, founded by Brauchli; Sasa Vucinic, a Serbian journalist who helped launch the non-profit Media Development Investment Fund; and Stuart Karle, former COO of Reuters. The millions of dollars in series A funding catapults Rappler into one of the most valued startups in the Philippines, one source says. A second source adds the financing round can grow with the entry of another investor, whose identity is not known yet. More than the capital, the three veteran journalists will bring top-level international media expertise to Rappler, equipping the company for its expansion in other markets in the region, starting with Indonesia. • Healthcare entrepreneur to fund many startups, starting with Bitcoin firm Satoshi Citadel Philippine Bitcoin umbrella company Satoshi Citadel Industries (SCI) has raised US$100,000 in seed funding from Filipino healthcare entrepreneur Joe Maristela. Maristela says the investment marks the start of many more investments he plans to make in Philippine startups, specifically those that are socially oriented and engaged in fintech. SCI caught his interest because of its mission to widen financial inclusion in the country by catering to Filipinos without bank accounts. The strength of its team was also a big factor. SCI is led by CEO John Bailon, SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul. 5 SparkLabs Global Ventures’ Technology and Internet Market Bi-Monthly Review March 16th, 2015 COO Jardine Gerodias, and CCO Miguel Cuneta, who co-founded the company in early 2014 with its very first product, Bitcoin payment processor Bitmarket. SCI has grown its product portfolio to include remittance service Rebit, order-book exchange Coinage, bills payment platform Bills Ninja, Bitcoin card provider Prepaid Bitcoin, selfie posting site Bitstars, and recently, Bitcoin exchange BuyBitcoin. Thailand • Omise raises US$2.6M to launch ecommerce payment solutions across Southeast Asia Thailand’s payment solutions company Omise announced series A funding of US$2.6 million led by Indonesiabased SMDV. Existing investors East Ventures, 500 Tuk Tuk, and Thai telco True Group participated in the round. Even as ecommerce spreads fast across Southeast Asia, payments are a pain. Many people don’t have credit cards or even bank accounts in the region, and payment gateways are clunky. Omise is one among several startups trying to fix this in different ways. Its easy-to-integrate payment gateway is designed to help merchants accept payments on any platform. It has been in beta mode so far. Now, with strong backers, it intends to go out into the market. It will be launching its products soon in Thailand as well as Southeast Asia and Japan. Singapore • Singapore’s Alpha7 raises US$2.3M, looks to complete its ‘COO as a service’ offering Singapore-based business consultancy firm Alpha7 announced that it has received private funding of US$2.3 million. Founded in 2014, the company previously raised US$375,000 in seed funding in January 2015, which brings it to a total of US$2.7 million in investments. The funding will go towards product development and recruitment, as the company looks to grow and expand its services to new markets. Alpha7 is a business consultancy-cumtechnology company, offering advice and business support to small- and medium-sized enterprises. As part of its expansion plans, Alpha7 wants to open an office in Australia in the second half of 2015. In addition, it wants to reach out to businesses from there, as well as the US and the UK, to help them expand their operations in Southeast Asia. • Singapore’s DocDoc raises US$8.5M series A round DocDoc, the Singapore-based startup that helps patients book doctor appointments online, announced it has closed a US$8.5 million series A round. Hong Leong Financial Group, led the round, and SparkLabs Global Ventures is participating. Co-founder Cole Sirucek says that the funding will be used to ramp up marketing. DocDoc matches patients looking for care with doctors looking to fill up appointment space. The company charges a monthly subscription fee for doctors that sign up. DocDoc’s basic premise borrows from ZocDoc, the New York-based startup that has spread across the US. DocDoc currently employs 64 full-timers and has a presence in Thailand, Malaysia, Hong Kong, Singapore, and the Philippines. Sirucek says that in the future, he hopes to boost DocDoc’s popularity among medical tourists. United States • Chartbeat raises US$15.5M and announces two products for publishers Site monitoring startup Chartbeat announced a US$15.5 million raise from investors Harmony Partners, DFJ, Index Ventures, Jason Calacanis, and others. The company says it raised these funds on a lofty goal: “We want to make sure that 10 years from now, it’s possible to build a sustainable business around quality content.” This mission arrives as classic editorial models — ones led by ad dollars and intuition — wobble online and across the social Web.* In addition to the new funding, Chartbeat is raising the curtain on two new products, one for content creators and another for advertisers. Specifically, they’re releasing a headline optimization tool and an ad serving tool, both of which apparently consider user behavior (not just clicks). • Sherpaa carries in US$2.25M for employer telemedicine platform Consumer-facing telemedicine platforms seemed to be coming out the woodwork last year, and funding for the technology was abundant. However, some investors say that the smart play is telemedicine platforms that are tightly integrated with employer benefits constructs. Sherpaa makes one such platform. It acts as an overlay on top of the insurance plans that HR departments offer employees. The company has now raised a US$2.25 million round, bringing its total funding to $8 million. The investors are O’Reilly AlphaTech Ventures, Softbank, and Draper Associates. Sherpaa gives employees access to physicians 24/7 through phone or asynchronous text communication. It also provides “insurance navigators,” human representatives who can help answer any questions employees may have about their plan. SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul. 6 SparkLabs Global Ventures’ Technology and Internet Market Bi-Monthly Review March 16th, 2015 • Therapy app Talkspace lands US$9.5M in funding from Softbank and others Therapy mobile app Talkspace just landed US$9.5 million in new funding with a lofty goal of bringing therapy to a billion people. The funding round was led by Softbank Capital and Spark Capital. Talkspace connects users with licensed therapists for mobile enabled text-based therapy sessions. The company’s mission is to deliver affordable therapy services, anytime, anywhere. Over the course of a year the company has ranked up 100,000 users across the U.S. Despite operating entirely inside the States, Talkspace has also picked up users in other English-speaking countries such as Canada and Australia. Talkspace is hoping to push its services more outside the U.S. The company says it expects to expand into Europe and Asia by 2016. To date the company has raised a total of $13 million in funding. • Tim Draper leads US$1.2M investment in Bitcoin startup Hedgy Hedgy, a Bitcoin company that hopes to tackle the cryptocurrency’s volatility issues, has emerged from Adam Draper’s Boost accelerator with US$1.2 million in hand. In addition to the funding, the company also announced that its block-chain enabled contracts are now available. Hedgy is collaborating with Bitcoin mining outfit MegaBigPower to allow miners to sign smart contracts that hedge mining payments for a predetermined date and price. Hedgy serves as a trusted third-party that helps to suss out the appropriate price using a weighted pricing index called the TradeBlock XBX. Because of the increasing cost of mining, some miners are wary of continuing operations. Adam’s father and longtime Bitcoin enthusiast Tim Draper led this round of investment, while Marc Benioff, Sand Hill Angels, and others contributed. • Deep-learning startup Clarifai gets US$10M to make business hires, add features Clarifai, a startup providing a cloud service for image recognition powered by artificial intelligence, announced that it’s taken on US$10 million in new funding. The startup will be bringing on more engineers in order to broaden its feature set, but it will also make its first business hires with the new money, Matthew Zeiler, Clarifai’s founder and chief executive, told VentureBeat in an interview this week. Clarifai is in a small class of startups building software to help companies perform deep learning, a type of artificial intelligence, to handle certain kinds of data. New Yorkbased Clarifai started in 2013 after spinning out of NYU. The startup currently employs 11 people. Zeiler wants to bring the headcount up to 25-30 people. • Validic raises another US$12.5M for health integration platform, Kaiser buys in Health information integration platforms, especially consumer-focused ones, were mostly talk last year, but in 2015 the technology is being put into practice. One platform company, Validic, has now secured a US$12.5 million funding round led by Kaiser Permanente Ventures, the corporate venture capital arm of managed care giant Kaiser Permanente. A funding by Kaiser is seen as an important seal of approval in health circles. The company’s integration platform provides a common place where medical device and consumer biometric device data can be collected, processed, and accessed by health care companies. Validic, headquartered in Mountain View, California, and Durham, N.C., said it’ll use the new money to continue to add staff, build products, and increase the number of devices reached by its platform. • Task management app Wrike takes on US$15M as enterprise revenue growth continues Wrike, one of several companies with apps for tracking tasks for teams, announced that it’s taken on US$15 million in new funding. Wrike now boasts more than 1 million users, and revenue from Wrike’s enterprise tier of service, introduced in December 2013, is growing 20 percent month over month. The company now counts 8,000 paying customers, and around 30,000 people try the product every month. The thing is, Wrike competes with a few other venture-backed startups with tools for tracking people’s tasks, including 6Wunderkinder (the company behind Wunderlist), Asana, Redbooth, Trello, and Workfront (formerly AtTask), not to mention Citrix-owned Podio. Scale Venture Partners led the new round. Bain Capital Ventures and DCM also participated. • Wide-area networking startup CloudGenix raises US$25M CloudGenix, a Silicon Valley startup with software for managing networks across multiple data centers, announced a US$25 million funding round, which allows the startup to spend more on sales and product development. CloudGenix came out of stealth mode in April 2014. A competitor, Viptela, came out of stealth mode within a few weeks, working with a $33 million funding round from Sequoia Capital. Now CloudGenix has pulled in more money. CloudGenix determines what to do with traffic flows based on the needs of applications in order to meet servicelevel agreements for customers. Bandwidth plays a factor as well. Bain Capital Ventures led the new round in SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul. 7 SparkLabs Global Ventures’ Technology and Internet Market Bi-Monthly Review March 16th, 2015 CloudGenix. Charles River Ventures and the Mayfield Fund also participated. To date the startup has raised $34 million. CloudGenix started in 2013 and is based in Santa Clara, California. • Media site Refinery29 closes US$50M funding round Refinery29, a fashion media site, has raised a US$50 million funding round. The news brings Refinery29 into the company of other extremely well-funded media companies: Vox Media, BuzzFeed, and Vice. That’s a reflection of just how large the site’s reach has become. Refinery29 claims that it receives 36 million visits per month, generating 258 million page views, and that its readers spend 3.6 million hours per month on the site — impressive numbers for any site. According to Re/code, which cited “people familiar with the company,” the new round values the company at $290 million. The funding was led by Scripps Networks Interactive and WPP Ventures. Refinery29 is based in New York and employs over 200 people. It was founded in 2005. • Investment app Robinhood snags US$50M, prepares for Australia launch Robinhood, a mobile investment app that lets you invest small amounts of stock with a quick scan of your fingerprint, announced a US$50 million raise. NEA Ventures led the round, which also saw participation from existing investors Index Ventures, Social Leverage, and Ribbit Capital. Robinhood offers a free mobile investment tool on iOS that lets anyone buy and sell stock for free. The app recently rolled out to the Apple Watch but has yet to come to Android. Despite this, the company says it has accrued hundreds of thousands of users since going live five months ago. The majority are millennials — a coveted demographic. The funding will go toward growing the company’s staff from 30 to 60 over the course of the year and to fuel expansion into new markets — specifically Australia. • Banjo raised US$100M from SoftBank to build social ‘crystal ball’ Banjo, which lets you monitor social networking and media activity based on location raised US$100 million from Japan’s SoftBank. “We are building a crystal ball — a way to see and know virtually everything happening across the globe the moment it happens,” wrote founder and chief executive Damien Patton in a blog post. “This funding will help make our vision to build the ultimate crystal ball a reality. By organizing the planet’s social signals by location, we’ve changed the game for our customers, and we are just getting started.” Over the past two years, the company built out a social analytics platform service to focus on selling information to other businesses, rather than fickle consumers. The company raised $16 million in March 2014 in a round led by Balderton Capital. • Blue Apron is cooking up a US$100M funding round on a US$2B valuation The New York-based startup is in talks to raise US$100 million in capital, on a valuation of US$2 billion. Blue Apron isn’t new to this game. It raised $50 million from investors in April 2014 at a $500 million valuation. Before starting the company, cofounder and CEO Matt Salzberg worked at Bessemer Venture Partners. Some of the other meal-kit startups that have popped up in the last few years include Plated, HelloFresh, and Marley Spoon. The company shipped a million meal kits last November, and that number has now doubled to $2 million. That amounts to about $20 million in monthly sales at a cost of about $10 a meal, the WSJ speculates. • Verizon acquires TechCrunch and HuffPost owner AOL Verizon, one of the biggest mobile carriers in the Americas, has acquired AOL, the owner of global online publications like TechCrunch, The Huffington Post and Engadget, for $4.4 billion, or around $50 per share. Verizon says the carrier will continue pushing for mobile-first content production and ad-tech which will further be boosted by the acquisition of leading online platform in the country. The carrier hopes AOL will increase the share Verizon gets from the $600 billion global ads market. AOL reaches to over 400 million viewers/readers today via the online publications under its roof, the press release has disclosed. AOL CEO Tim Armstrong, who will continue holding his position, said AOL’s strategy to further invest in mobile content will be strengthened. AOL’s latest Q1 results has gone beyond the expectations with $625 million of revenues. Europe • Zesty, a startup offering a platform for booking medical appointments, raises US$7.2M in Series A English doctor-booking service Zesty has announced that they have picked up US$7.2 million through a Series A that includes participation from Innovation Capital, Mangrove Capital Partners, Qualcomm Ventures, and Maya Capital. This is their third round, with Mangrove invested at every stage and the startup looking to the east in 2013, when they picked up funding from Ukrainian investment firm TA Ventures and Russian firm ABRT Venture Fund. SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul. 8 SparkLabs Global Ventures’ Technology and Internet Market Bi-Monthly Review March 16th, 2015 Though the startup has focused upon the United Kingdom since it launched in 2013, they have their sights set on global expansion, stating that they intend to use this latest funding to secure their position in the domestic market and to begin branching out into western Europe. • Finnish crowdfunding platform Invesdor sets its sights on the rest of Europe Crowdfunding is increasingly popular, but allowing startups to offer equity to the masses in exchange for investment has been a bit problematic, as there are barriers for a number of less-wealthy individuals to enter this market. Nonetheless, startups, such as Finnish project Invesdor, have emerged to make it equity for ordinary people to obtain shares in a company. The concept is not completely unique, but what is notable about this startup is that they have just obtained an MiFiD-level license to operate as an investment firm, which means that they are able to operate across Europe, becoming the first crowdfunding investment platform to do so. To date, the startup reports that they have facilitated investment totaling 4.4 million Euro from non-professional investors since the service launched in mid-2012, with more than a million of that being invested during Q1 2015. • Delivery Hero acquires Turkish food delivery leader Yemeksepeti at a total valuation of US$589M Global food delivery giant Delivery Hero has acquired Yemeksepeti.com, the Istanbul-based food delivery network that operates in 8 countries across East Europe and the Middle East. All Yemeksepeti shares will transfer to Delivery Hero according to the deal that values the latter at US$589 million. The sides to the cash and shares deal claim it is the biggest acquisition to date in the Middle East digital sectors but also the largest so far in the entire online food delivery sector in the world. Nevzat Aydın, the CEO and co-founder of Yemeksepeti will keep holding his present position at Yemeksepeti and assume ‘active role’ in the leadership of Delivery Hero to grow the group further across the world, according to a press announcement. The acquisition is said to be funded through cash and Delivery Hero shares with selected shareholders of Yemeksepeti, including General Atlantic and Rocket Internet. • P2P lending service Assetz Capital raises just over US$4.7M through crowdfunding British P2P-lending startup Assetz Capital has announced that they have raised just over US$4.7 million (3 million pounds) through Seedrs, a crowdfunding startup that allows regular people to invest in various projects. Assetz launched two years ago and currently counts nearly 8,500 lenders, but they have not previously raised funding. The company said that they had received interest from their lending customers in financially supporting the startup, which led them to decide to launch a crowdfunding investment campaign. They initially sought 2 million pounds, but expanded their target to 3 million, which they hit with support from almost 800 backers. Supported by this latest influx of funding, the startup intends to expand their team and begin to branch out other European markets. • Opera Mediaworks to buy leading Turkish mobile ads network Mobilike Opera Mediaworks, the adtech subsidiary of Norway’s Opera Software, has agreed to acquire Mobilike, one of Turkey’s leading mobile ad platforms. The value of the deal has not been disclosed. The addition of Mobilike who has just opened its country office in Greece, is expected to significantly expand Opera Mediaworks present operations across 15 countries. Mobilike’s network of publishers and advertisers will be integrated to Opera’s platform. Mahi de Silva, the CEO of Opera Mediaworks, said that the acquisition will help Opera Mediaworks grow further into Turkish and Middles Eastern markets where over 30% of internet traffic is coming from the mobile. Founded in 2009 by Şekip Can Gökalp and Volkan Biçer, Istanbul-based Mobilike claims having the largest mobile advertising network in Turkey today, with over 3 billion page impressions on mobile phones and tablets. • US$474M Fund Will Support Oxford University Spinouts A new £300 million (just under US$474 million) U.K. fund has been set up to support high tech startups looking to spin out of the University of Oxford. The fund is being raised by Oxford Sciences Innovation (OSI), a newly formed company that is working in partnership with Oxford University and its commercialization arm, Isis Innovation. The two entities will work to establish new IP-driven businesses based on research conducted at Oxford University — providing investment capital and as well as advice to budding startups, they said today. OSI has been contractually established as the University’s preferred capital provision partner for spinout companies based on research from the Mathematical, Physical, Life Sciences and Medical Sciences divisions. It noted that Oxford University’s science divisions have an annual research budget of more than £400 million. • Cloud-Based Sales Software Pipedrive Closes US$9M Series A Pipedrive, which offers Software-as-a-Service designed to help small companies manage and increase sales, has closed another deal of its own. The Estonia/U.S.-based startup and AngelPad alumni has raised a US$9 million Series A round led by Bessemer Venture Partners, money it will use to accelerate growth and further build out its SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul. 9 SparkLabs Global Ventures’ Technology and Internet Market Bi-Monthly Review March 16th, 2015 product. Paua Ventures also participated, along with existing investors, Rembrandt Venture Partners and AngelPad, the latter of which incubated Pipedrive in all the way back 2012. The company, which now boasts 77 employees based in the U.S. and Estonia (the latter is where its development office is located), has raised a total of $13.4 million. Israel • Container security startup Twistlock launches out of Israel with US$2.5M An Israeli startup called Twistlock just launched, with the words “containers” and “security” on the brain and US$2.5 million in funding. Twistlock has a long list of things in mind to make it easier for enterprises to adopt containers — a technology for storing up application code that can be easily moved from one server environment to another. In the past two years, San Francisco startup Docker has made Linux container technology, an alternative to or replacement for virtual machines that work with software from vendors like VMware, more accessible than it was before. Twistlock is interested in hardening hosts and images — by using quality gates that would test images before they can be put into production — and providing a central hub for authentication, authorization, and auditing. YL Ventures led the round, with an unnamed angel investor also participating. • Three Israel hi-tech veterans launches a new fun, Eucalyptus Growth Capital Three Israeli hi-tech veterans Dadi Perlmutter, Rami Hadar and Eldad Tamir have announced the launch of a new fund, Eucalyptus Growth Capital. The fund is seeking to raise a total of US$300 million from investors around the world and intends to invest in late-stage funding of startups. Hadar said that $10 million in annual sales would be a good stage for their fund to come in at. The companies they are seeking to invest in are “anything to do with digital revolution, man-machine interface, artificial intelligence, machine vision, IoT, and mobile applications.” “We plan to invest at the C stage and later,” Rami Hadar, one of the fund’s founding partners, told Geektime. “It has to be a long way after product viability and sales.” The fund will invest $15-$30 million in each company. Australia • Australian task marketplace Airtasker raises US$5M, looks toward Asia Australian local task services marketplace Airtasker announced that it has US$5 million in capital in a funding round led by Shanghai’s Morning Crest Capital. Australia’s National Roads and Motorists’ Association (NRMA), and venture capital firms Exto Partners, Carthona Capital, and Black Sheep Capital were also involved. The funds will go toward product development, engineering, customer support, and new services in anticipation of a new projects. Airtasker, like Taskrabbit, provides a marketplace for freelance tasks and odd jobs offered by anyone looking to make extra income. Services cover areas from specialized tasks such as handyman work and photography to simple delivery jobs. It monetizes by charging percentage-based commissions on completed tasks. Airtasker had previously raised US$1.6 million in seed funding in a round led by Exto Partners and Bridge Lane Capital in 2013. • Canva brings graphic design app to businesses, raises another US$6M Canva, a startup from Australia that makes graphic design simple for users through its web app, announced a funding round of US$6 million and a whole new product aimed at companies, appropriately dubbed Canva for Work. The round was led by Matrix Partners and Shasta Ventures from Silicon Valley, and Asia-Pacific firms Blackbird Ventures and AirTree Ventures. While Canva for Work will charge a subscription fee for use by businesses, the company will continue supporting Canva for individual users. While Canva for Work will charge a subscription fee for use by businesses, the company will continue supporting Canva for individual users. Canva previously raised US$6.6 million in two funding rounds. SparkLabs Global Ventures (http://www.sparklabsglobal.com) is a global seed-stage fund with partners in Silicon Valley, Chicago, London Tel Aviv, Singapore, and Seoul. 10
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