August 15, 2007
Bluefly Founder Launches Funded DietTV Social Network
Ken Seiff launched online fashion retailer Bluefly in 1996 and took the company public in 1997. He is back for me with DietTV which he founded in February 2004.
Founder and CEO Seiff
DietTV.com is a New York-based social network for dieters It just has raised $2M in Series A funding led by MentorTech Ventures. Previous funding came from Seiff.
There is no reason why a business like this can't be a big success. After all, across town in Brooklyn, Waterfront Media is making a small fortune each year, primarily selling diet social networking schemes online.
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Business Intelligence's LucidEra Raises $15.6M
San Mateo-based LucidEra has raised $15.6M in Series B funding led by Crosslink Capital with return backers Benchmark Capital and Matrix Partners. The 2 year old startup allows clients to pull data from CRM and accounting systems in order to provide improved visibility into sales, marketing, and back-office processes. For Web 2.0'ers this might not seem like big shakes, but LucidEra is one of the hottest companies in the new enterprise software arena.
An on-demand license to LucidEra costs $2,900 per month. This price is up to 10x less expensive than a typical on-site installation, the company claims.
The startup is led by Ken Rudin who was VP and GM of Siebel CRM OnDemand and SVP, Products at Salesforce.com
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August 14, 2007
This Week In Online Advertising
+ Adteractive, Waterfront Media, Morpheus Media, MediaStorm, Gorilla Nation make Fast 500 cut.
+ aQuantive CEO McAndrews gets top ad job at Microsoft.
+ Ad exchanges are the hot business in the US but until now China has not had one.
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VMWare IPO Crushes It
At this post, VMWare is trading at $55 per share, well above its open price at $29. When EMC bought VMware (VMW) in 2004 for $625M and there was some criticism that EMC had overpaid, reports Barrons. The company’s 85.6% stake is now worth in the vicinity of north of$16B and is closing in on half of EMC's total market cap.
Analysts are giddy over the stock. Jefferies & Co. launched coverage this morning with a Buy rating and $42 price target which the company blew past. Jefferies says the company’s virtualization software is the first new layer of IT infrastructure in more than 10 years and says the company has a 5-year lead in helping IT improve server ROI. Holding down more than 90% of the virtualization market, VMWare “is on a trajectory that mirrors Microsoft Oracle and Veritas in the early days.”
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Musical IM Avatar Maker Doppelganger Launches Vside. Raises $11M
Everywhere we look we seem to see IM avatars based on The Simpsons. San Francisco-based Doppelganger wants to get the same effect with its avatars based on music acts like Nelly Furtado, All-American Rejects, and Eminem. Doppelganger has just raised $11M in fourth-round funding led by ComVentures with return backers DFJ, Draper Richards, Trident Capital, KPG Ventures and Greycroft Partners.
The Doppelganger world is located at TheMusicLounge.com. Business partners include Interscope Records, Warner Music Group, Warner Brothers, and MTV Networks.
However, more recently the company has launched a new virtual world called Vside. This virtual world is built on a neighborhood hub of nightclubs and as you crawl from club to club you hear different soundtracks. One of the smarter aspects of the game is that players earn respect points that encourage socialization, and more time spent in the virtual world. Hipper clubs in Vside will only allow in people with lots of respect points. You earn respect points by hanging out in cool places and meeting cool people.
Vside officially launched today but pros who were allowed a pre-view are giving it great reviews.
Doppelganger competes with Second Life, There.com's "Virtual Laguna Beach," Vivendi's World of Warcraft, and the upcoming "Home" virtual world built around Sony's PlayStation 3. It competes both for relationships with Hollywood properties as well as course for viewers' time.
For the past 8 months, the company has been led by CEO Tim Stevens who was an SVP at both Borland and Inktomi. Doppelganer seems to have a good number of people who came from business software.
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CNET Buys Shanghai's OnlyLady
CNET continues to expand it content holdings well beyond its tech base as CNET China has announced its acquisition of Shanghai-based female fashion website OnlyLady. OnlyLady was established in Shanghai in 2002 and claims 800K active members. As the name suggest, OnlyLady caters to women in China with postings on fashion and cosmetics. It makes money both through ads and eCommerce. The purchase price for OnlyLady is not yet known.
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TravellingWave Angel Funded To Predict Voice Commands On Cell Phones
Seattle-based TravellingWave has raised an undisclosed round of Series A financing from angels for its speech recognition + predictive text software. The idea is that TravellingWave users tap speech recognition technology, for entering text into mobile devices. The technology dubbed "Predictive Speech-to-Text" combines traditional predictive text input simultaneously with speech recognition. The result is a relatively simple and fast user-interface for mobile devices whereby users can speak a word and the software will predict what the user is searching for.
The company says that in addition to its angel round, it raised a $150K federal grant.
Read - announcement
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Navisite Buys Two Hosts For a Combined $15M
NaviSite (NASDAQ: NAVI) has acquired two Internet-services companies for a combined $15.5M. It announced it would buy both Alabanza and Jupiter Hosting. The deals were financed mostly with cash.
Andover, MA-based NaviSite sells application management, Internet infrastructure and hosting solutions for the middle market. Baltimore, MD-based Alabanza sells dedicated and shared web hosting services and a software platform for managing high-volume hosting solutions. Santa Clara-based Jupiter Hosting develops managed hosting and infrastructure services with a focus on Internet protocol television, video on demand and progressive video delivery.
Read - announcement
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SyncVoice Becomes Communicado. Raises $11.6M
Enterprise communications monitoring startup SyncVoice Communications has raised $11.6M in Series B financing from SoftBank Capital, Clearstone Venture Partners, and Hummer Winblad Venture Partners. Along the way it changed its name for the usual reasons - it does more than voice now it does video and live conferencing as well.
The Costa Mesa, CA-based company claims 400 clients including Tenet Healthcare and the Discovery Channel. It started life focused on voice expense and operations management product for multi-vendor companies and has now expanded with software that manages telco expenses for other communications tabs.
Read - announcement
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August 13, 2007
Booking Angel To Take On OpenTable
OpenTable has some IPO buzz at the moment. The company went quiet for years as it requires hardware installed at restaurants and that takes time but the hardware requirement is also seen as a competitive advantage.
Along comes a startup in a parallel business but without the hardware requirement. Booking Angel is an online reservation system that takes booking information entered at a form on a website and converts it to a voicemail message that the target business receives via telephone. The business can accept/reject or amend by pressing the keys on their phone. The concept is to allow the hundreds of thousands of small/medium sized businesses to access potential customers on the Internet without having to build a web page or even own a computer. The business model is pay per booking for websites.
Australia-based Booking Angel recently raised $100K from angels to help it to establish an office state-side. The funding comes from the Australian Distributed Incubator and Information City.
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Classmates.com Files $125M IPO
As a site that covers private technology startups, we didn't think that we would be covering Classmates.com (unless perhaps it was buying another startup). The company is after all a division of United Online (UNTD). But eying Wall Streets interest in social networks, combined with strong revenues from Classmates, United thinks its a good idea to spin-off Classmates and take it public.
The company plans to trade under the ticker “CLAS” and its IPO is being led out by Goldman Sachs, JP Morgan and Deutsche Bank. Classmates says it has 50M registered users and 2.7M paid accounts. United Online acquired Classmates in November 2004.
Another company that was acquired by Classmates, MyPoints, will be part of the offering. Classmates.com was founded in 1995, so it a bit of a irony that such an ancient site will be a testing ground for valuations of Web 2.0 social media.
Read - Press release
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Bezos + Buddies Invest $6M In Virtualization's Illumita
Seattle's Illumita has raised $6M in Series A funding from Ignition Partners and Madrona Venture Group, Bezos Expeditions and Washington Research Foundation. Illumita is pre-launch but plans to offer a virtualization product. Given that VMWare is dominating virtualization and Microsoft is gasping for air trying to catch up, how can a pre-launch startup compete? llumita says that in contrast to what VMWare offers it will allow virtualization over the Internet and in will make its use simpler.
Read - Infoworld post
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Peerflix CTO Jumps Ship For Pre-launch TravelMuse
Travelmuse was founded in April 2007 by former SAP Labs VP Kevin Fliess. The company was able to recently recruit a head of engineering - Cyril Bouteille - who was CTO at Peerflix. It would seem to be a good fit as Bouteille was Senior Software Architect with travel search service Hotwire for 6 years.
TravelMuse says it is venture-funded and is launching in early 2008. TravelMuse, which currently has a headcount of just 5 people, says it will "simplify and improve the entire process of online travel planning - from finding travel inspiration, through planning and booking your ideal itinerary, to sharing your experiences with others."
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Ning Competitor KickApps Raises $20M
The a:c backs the own your own social network concept being popularized by Ning, Kickapps and others. We just think that if you own a social network you will do a better job of managing that niche than Myspace or Facebook ever will. Ning seemed to have surprised a lot of people with its big $44M round recently and now Kickapps has raised $20M.
The company provides a hosted, turn-key, customizable white label community platform with MySpace/YouTube functionality, primarily to major media websites.Founded in 2004 by CEO Eric Alterman, KickApps is based in Manhattan and was originally funded by Spark Capital and Prism Ventures. It has won some nice endorsements from big media companies that are using Kickapps such as Vibe Magazine and Scripps.
The a:c and others tend to group Ning and Kickapps together and while their concepts are similar we doubt their target users ever overlap. Ning is really not for large media companies to integrate into their current sites - although it may be in the future - and Kickapps is really not for small groups like regional volunteer fireman associates, which is a great fit for Ning.
Like Ning, Kickapps seems to have launched with some big features missing, but both have added functionality at a fast clip.
View - Kickapps site
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Hands-On: The Biggest F-Up In Gaming
Hands-on Mobile recently jettisoned its CEO Jonathon Sachs, in a move that finally recognized that the former AOL exec was radioactive. Sachs took the reigns at Hands-on Mobile two years ago when it was one of the most promising startups around. Sachs moved the company from Seattle to San Francisco, rebranded it from Mforma to Hands-on and prepared for the IPO that investors expected. He then raised $30M more from Institutional Venture Partners, bringing its total capital raised to $94M. Come 2006, Hands-on had revenues north of $100M and was profitable. By some accounts this made it the largest mobile gaming country in the US.
Inside the company, however, it was ugly. Hands-on had over 1000 employees in 11 offices but there was constant management restructuring so that it was hard for staff to know what their marching orders were and who to take them from. Consequently, revenue flat-lined, even fell. For investors, the train wreck must have been particularly hard to bear given that Hands-on's chief rival Glu Mobile had a terrific IPO. Adding fuel to the fire, Sachs arrogantly dismissed Glu with a quote that will surely follow calling Glue: "like a wart on my ass. It's not even in my league."
Hands-on is now looking for a new CEO and rumors are that it will be bought, perhaps by Yahoo or by one of Hands-on's rivals like Glu Mobile.
Read - Moconews post
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SonicBids Funded As Community Site For Bands To Book Gigs
Boston's Sonicbids has raised $4.5M from Edison Venture Fund. Sonicbids is a community for the business side of music, allowing band and music promoters to connect with each other. The startup was founded by CEO Panos Panay who launched the company way back in September 2000. The site claims over 70K artists and over 6K festivals, music conferences, and clubs from over 100 countries.
We have heard from friends in bands that the business side of music is tedious. Booking gigs has meant calling venue managers, managing calenders, sending photos and music samples, and more. Sonicbids takes away much of that labor by creating a digital system.
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Read - PEHub post
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Glam Media: Publisher or Ad Network? Does it Matter?
We just finished reading lengthy profiles of Glam Media on Techcrunch and VentureBeat that give us the news that Glam Media is looking to raise $200M in a round organized by Allen & Co. We get some strong efforts by both sites to crunch the numbers on the question of whether Glam Media is an ad network, a destination site or both. Does it matter? It would if the market didn't value an ad network as highly as it does a portal. But that doesn't seem to be the case with ad networks being a hot commodity.
The controversy, in a nutshell, is that Glam Media boasts of a wave of rising traffic to its network. However, because the company doesn't own most of the sites that it counts traffic on it shouldn't boast that it is bigger than iVillage or growing faster than MySpace. It's a fair enough beef. We suspect Glam blurs the lines for PR reasons which would raise more awareness with advertisers and its probably been an effective strategy even if it has had some blowback.
What really matters, however, is can Glam sell ads and get good performance on those campaigns so that advertisers will return with bigger campaigns. Glam has to continue to feed that growing beast that is its publisher network or it will lose them.
It appears that Glam has strong brand ad sales people. It's less clear what if any technology Glam has to juice stronger performance. VentureBeat reports that Glam is set to close a $1B ad deal. This is a staggering number for an advertiser to commit to. We can't imagine that any advertiser or network would sign off on such a deal without knowing where their ads would run and without having run tests to verify performance.
A number of readers comment that they can't understand why Glam would require $200M. We expect they might a) buy some of the sites in their network b) invest in or buy behavioral ad technology to improve performance c) management might even sell some stock to investors.
Read - VentureBeat post
Read - Techcrunch post
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August 12, 2007
Hotel Booking Site FiveStar Acquired
Questex Media Group has acquired online luxury-hotel booking service Five Star Alliance for an undisclosed amount. Alexandria, VA-based Five Star Alliance only indexes luxury hotels around the world, allowing users to book rooms from the site.
The company was founded by angel investor Cal Simmons and former Washingtonpost.Newsweek Interactive CFO Eric Koefoot in 2004. The company does not indicate its revenues but says its site gets about 3M page views and 400K unique visitors each month.
Questex Media publishes magazines Premier Hotels & Resorts, Luxury Travel Advisor and Travel Agent.
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Read - Washington Business Journal story
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Dayparting Social Networks: Noonhat and PMBuzz Launch
Noonhat and PMBuzz don't have much in common except that they are both just launched social networks that are set up to enable users to meet offline and they are meant to be used at specific times of day. Noonhat is a lunch site and PMBuzz is a late night site.
Noonhat is unusual site as its wants to actually change human behavior. Visit the site, enter your email address and date you want to have lunch and Noonhat will hook you up with other stranger who can lunch with you. The company's founder stresses that this is not a dating site. Call us cynical but we tend to think of this as a site for the lonely or for people with some kind of agenda that they want to push.
PMBuzz is much more of a conventional site. At launch it is specifically a hub to get people together in the nightime in New York city. GoingOn launched a similar type of social network, in Boston first. But PMBuzz seems like it is gunning for a different kind of user. GoingOn was for the collegiate set, whereas PMBuzz seems to be more for the gay or metrosexual. PMBuzz's lunch party was a glitzy event that had Perez Hilton as the guest of honor. Because PMBuzz is more conventional it will face more competition, we expect, but it has done a good job so FAR at getting attention.
View - PMBuzz site
View - Noonhat site
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Swedish Facial Recognition Startup Polar Rose Launches Beta
Malmö, Sweden-based Polar Rose has launched a private beta site. The startup had raised a Series A round of $5.1M from Nordic Venture Partners to make a business out of its facial recognition technology applied to searching and identifying images, particularly facial images, on the Web. It wants to make images indexable just like text documents on the web are today. For example, there are likely a number of images on the Web of any of our readers but without text attached to them a search will not return those images.
Polar Rose says that in the fall it will open up for a royalty-free use of its APIs, which will allow for partners to integrate the Polar Rose functionality into existing sites. This has Google acquisition bait written all over it.
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August 11, 2007
Down Under's QmeCom Coming To America With Video Ad Tech
A regarded VC told us recently he expects to see a wave of buyouts of video advertising startups. It doesn't make sense for a company to just do video advertising but the incumbant ad networks generally don't have good video ad stuff. So it was a smart move by Australian startup Qmecom to move its office to the US. The startup has developed a system to deliver personalized video ads targeted to specific geographies, genders, and ages.
QmeCom has received about $3M from Australian investors including Map Venture Partners and is now seeking more investment to continue its expansion in the US.
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Read - Aussie online ad personaliser targets US market
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$12M For Mobile VoIP's Fring
A VC told us yesterday that his firm has been looking around for more mobile VoIP companies to invest in. Many of the mobile VoIP companies that we have been tracking continue to draw a crowd of investors. Israel's Fring has just closed another round of financing at $12M led by North Bridge Venture Partners. Also participating in the round were VenFin and Fring's existing investors Pitango Venture Capital, Veritas Venture Partners, and angel Yossi Vardi.
Fring was co-founded in 2005 as a spin-off from UsefulApp by CEO Avi Shechter and two partners. The company is developing free mobile VoIP (mVoIP) software applicatin which can be installed on a 3G handset, enabling users to make calls via computers, instead of via expensive wireless carriers. It also comes with real-time presence and live chat with multiple IM providers over mobile data networks or a Wi-Fi connection.
Read - VoiP Monitor
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August 10, 2007
RSA Buys Tablus For Data Loss Prevention
RSA, which is owned by EMC, said it will acquire Tablus, which sells data loss prevention products. Financial terms were disclosed for the deal. Tablus has raised $23M in VC funding since 2003 from Menlo Ventures and Trident Capital.
RSA and EMC said in a release the acquisition of San Mateo, Calif.-based Tablus will add data discovery and classification, monitoring, and data loss prevention capabilities to RSA's data security portfolio. San Mateo-based Tablus monitors computers to catch when they are being used to leak sensitive information. It rode the wave of enterprise software companies funded to help chief information officers comply with federal regulations such as the Health Insurance Portability and Accountability Act and Sarbanes-Oxley.
Several of Tablus competitors have recently been acquired. In January, Websense bought PortAuthority which is based in Israel. And McAfee spent $20M to acquire Onigma, also based in Israel.
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Read - announcement
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VMWare Ups Share Price: Biggest IPO Deal Since GOOG
VMWare boosted the size of its IPO to as much as $1.2B, which would make it the biggest tech IPO deal since Google floated in 2004 when it raised $1.92B. Last July, VMWare said shares would sell for $23-$25 per share. Since then, Cisco and Intel have invested and now VMWare says share might sell for $27-$29. VMWare also indicates that net income for the 3 months ended June 30 more than doubled to $34.2M from $15.2M a year earlier.
Read - Reuters story
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GridMedia Raises $2.5M From Norwegian Gov't
The European tech scene is so different from what we see here in the US. The government of Norway invested $2.5M in GridMedia. It's really hard to imagine the US government investing in a game technology startup. Then GridMedia moved to San Francisco. So there goes the justification that GridMedia might produce more jobs in Norway.
The startup was founded by Ole Holthe who developed a platform called Geelix while working on a PhD program. The idea was to record video game sessions and then offer playbacks of those games on web pages. So if a grand master at Halo 2 had an epic session we could all watch in awe. Holthe took that technology and launched GridMedia.
Read - Examiner story
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Storage Virtualization's EqualLogic Files $125M IPO
Nashua, NH-based EqualLogic was founded by former Allaire exec Paula Long and has taken off since she launched the startup in 2001. Today it has filed for a $125M IPO. Equallogic sells network storage solutions. It plans to trade on the Nasdaq under ticker symbol EQLX, with Goldman Sachs and Credit Suisse as lead underwriters.
In 2006, the company reported $59.9M in revenue, an increase of $32.7M over the previous year. In the same year, the company also posted a net loss of $549K compared to 2005's loss of approximately $9.4M.
Competitors are EMC, Network Appliance, HP, Compellent Technologies and LeftHand Networks.
EqualLogic has raised around $57M from VCs. Charles River Ventures holds the biggest stake at a 30.1% pre-IPO stake) along with Sigma Partners at 29.2%.
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CreditCards.com Files For $115M IPO
Austin, TX-based CreditCards.com has filed for a $115M IPO. The site allows consumers to search, compare, and apply for credit cards.
It plans to trade on the Nasdaq, with Credit Suisse and Citi as co-lead underwriters. Austin Ventures sponsored a recap of CreditCards.com in 2006 and holds a 65.6% pre-IPO position. It paid $133.8M at the time. Internet Real Estate Group sold the domain to Click Success in 2004 for just $2.75M. Daniel Smith pocketed $97.7M from the sale to an Austin Ventures.
During the six months ended June 30, the company's earnings lowered to $2.8M, from $9.6M in the prior-year period. During the same period, CreditCards.com revenue grew to $27.4M, from $18.7M. The company's revenue come from credit-card issuers or their affiliate marketing agents, who pay leads.
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Japanese Video Search Engine Foooo Raises Tiny Funding Round
Daisuke Tanaka, Founder of the Japanese Video Search Engine Fooooo, gets in touch to lest us know that he has raised $100K in seed financing from CyberAgent, a Japanese IT venture company listed
on the Tokyo Stock Exchange.
Fooooo indexes videos across the web with search results including links directly to the page hosting the video or a “Quick Start” link which activates a Flash based popup where you can view the video directly. The Quick Start option is available for most videos with the exception of MySpace videos. It has multilingual versions of its search engine including support for English, Chinese, French, German, Italian, Korean, Portuguese, Russian, and Spanish.
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