Category Archives: WaldenVC

Live Universe acquires yet another over funded start-up on the cheap

It appears that the buyer’s profile of Live Universe is to buy web 2.0 companies in trouble on the cheap, yet preferably over funded, with some traffic and good technology, if possible. After they have bought video site Revver (also relatively cheap, price perhaps was in the $1M range) in February 2008, they have also fetched up Pageflakes just the last month for what is believed to be yet another 1M dollar deal. Yesterday we have read over Web that Live Universe has this time bought yet another start-up falling into the same profile (over funded, failed and looking for a fire sale) MeeVee. They have put themselves up for sale via press release the last month.

MeeVee is all about personalized TV guides and the company was said is having over 1.1 million organic unique users in March up from 480,000 in August 2007. The Company uses its editorial voice and proprietary technology to scour a curated list of thousands of sources to connect consumers with customized video, blog and TV programming content that matches their interests. The Company has significant issued IP, community, media relationships, a TV listings personalization engine, streaming TV directory and a compelling product roadmap. The Company has 7 full time employees, all in product and engineering.

Let’s look into the Live Universe’s shopping pattern.

Total funding for Pageflakes was $4.1M – sold out for what is known to be in the $1M range. Total funding for Revver is known to be in the $12.7M range coming from Comcast, Turner, Draper Fisher Jurvetson, Bessemer Venture Partners, Draper Richards and William Randolph Hearst III – sold also out for anything between $1M and $2M. MeeVee itself has also taken a whopping amount of money from the venture capitalists — $25M over the past years, we bet on it has also been sold out for anything in the $1M / $2M range. From the 3 companies above, MeeVee seems to have traffic, at least.

It is an interesting strategy to buy companies and spur growth, but we guess it is better you buy growing start-ups rather than falling stars that have spent enormous amount of capital yet did not work things out. It is yet to be seen if this strategy is going to be successful on the long term run for Live Universe. Let’s put it that way – a company that has raised $25M and did not manage to work things out is less likely to make it with less money. On the other hand buying distressed assets is something proven by the time. From Live Universe’s perspective it seems clever move that they have bought web assets that needed more than $42M to develop for $3M or something. As web 2.0 moves towards its peak and then its end (the same as what happened with the dot com boom) there would be lots of over funded and over hyped, but failed start-ups for sale on the table for Live Universe to choose from and buy cheaply.

So to conclude if your company has taken enormous amount of money, but has definitely failed to work things out and is looking for some liquidation of its assets Live Universe might be your choice to consider.

The buying company LiveUniverse is probably most popular with the fact it has been founded by one of the founders of MySpace – Brad Greenspan. With over 55M monthly unique visitors, LiveUniverse is one of the world’s largest online entertainment networks. They operate several successful and popular websites across three core verticals: Video, Social Networking & Music. LiveVideo is one of their sites, which about a year ago instigated a scandal on YouTube when it reportedly paid top YouTube users to come to its platform. LiveUniverse founder Brad Greenspan, who was involved with MySpace early on, is perhaps best known for his lawsuits protesting the company’s sale to News Corp.

Additionally in 2006, Greenspan also initiated a lawsuit and activism site against his former company, MySpace, calling attention to the fact they were censoring widget makers and software service providers using MySpace as a development platform.

More

http://www.liveuniverse.com/
http://www.crunchbase.com/company/liveuniverse
http://meevee.com/
http://biz.yahoo.com/bw/080407/20080407006076.html
http://www.techcrunch.com/2008/04/07/25-million-later-meevee-in-trouble/
http://www.crunchbase.com/company/meevee
http://www.techcrunch.com/2007/07/16/meevee-cuts-20-of-staff/
http://www.techcrunch.com/2007/09/20/meevee-takes-35-million-series-d/
http://www.econtentmag.com/Articles/ArticleReader.aspx?ArticleID=17395
http://findarticles.com/p/articles/mi_m0EIN/is_2006_Feb_27/ai_n16085490
http://www.techmeme.com/080407/p95#a080407p95
http://www.deftapartners.com/
http://www.labrador.com/
http://www.waldenvc.com/
http://www.jpmorgan.com/pages/jpmorgan/investbk/global/na/baef
http://web2innovations.com/money/2008/02/15/revver-the-video-revenue-sharing-site-finally-sells-out-but-the-price-is-not-hefty/
http://web2innovations.com/money/2008/04/15/pageflakes-is-acquired-by-brad-greenspan%e2%80%99s-live-universe/
http://web2innovations.com/money/2008/02/15/revver-the-video-revenue-sharing-site-finally-sells-out-but-the-price-is-not-hefty/
http://web2innovations.com/money/2008/04/08/meevee-put-itself-up-for-sale/
 

MeeVee put itself up for sale

An interesting approach is taken at MeeVee. They are trying to sell themselves through a press release. This morning we have seen a short press announcement put up on Yahoo through BusinessWire giving relatively short details about the company and soliciting interested parties to contact a person at his email as indicated in the pr.

MeeVee is all about personalized TV guides and the company was said is having over 1.1 million organic unique users in March up from 480,000 in August 2007. The Company uses its editorial voice and proprietary technology to scour a curated list of thousands of sources to connect consumers with customized video, blog and TV programming content that matches their interests. The Company has significant issued IP, community, media relationships, a TV listings personalization engine, streaming TV directory and a compelling product roadmap. The Company has 7 full time employees, all in product and engineering.

So, what’s so interesting in here one may ask. First off in the press release the company claims is engaged in multiple discussions with potential acquirers that provide the greatest long term upside and synergy, but are giving a public announcement where they solicit more such interested parties to discuss with them. It is either nobody is interested in the company to date and they are trying to attract such interest or the interested parties are setting their offers too low and MeeVee is trying to establish sort of bidding war in order to drive valuations up.  You don’t normally ask for interested parties to contact a company re a sale unless the current talks (if any) aren’t going well.

So far so good, but when you go into some more details about the company you realize there is something wrong with the whole situation around MeeVee.

The company is known to have taken $25M in total funding to date and having just 1.1M ungues per month off $25M in venture capital appears no longer that attractive as in it was in first reading. That sort of information is skipped in their original press release. Their last round of funding (Series D) was taken just late last year and was in the $3.5M range, which means they have spent most, if not all, of the money they have previously taken. As to what is only left in the company from their last round remains unclear. To top it off the company has gone through some significant layoffs.

Some of MeeVee’s unhappy investors include DEFTA Partners, Edmond de Rothschild Venture Capital, WaldenVC, Labrador Ventures, The Bay Area Equity Fund (Effective January 24, 2008 the private equity investment professionals of the Bay Area Equity Fund have left JPMorgan to form DBL Investors LLC) and FCPR Israel Discovery Fund.

Over the past years we have been witnessing not only one deal where a web site with over 1M unique visitor per month has commanded acquisition prices in the $20M range, but in the MeeVee’s case we do not think that is the case. Why? Well, MeeVeee has spent $25M so far, has laid off its employees and is on its way down. If you have spent $25M the expectations for your company are for much larger reach and audience than just 1.1M visitors per month, so in the case their 1M users per month can be considered quite a failure in the context of the resources being allocated to the company.  The picture is already quite different if you take for an example a web site that has reached the 1M uniques per month mark off say less than $1M of money invested in so far, did not lay off its employees and is not on its way down as a trend on the traffic graphs of sites like Quantcast and Compete.

Whatever the case is it is hard for us to believe that 1.1M uniques per month can command a price anything above the amount of money they have taken from an army of venture capitalists. So what is then the case here? It is perhaps that the VCs are looking for a way to effectively liquidate the company and recoup whatever is possible leaving the founders with literally empty hands.

More about MeeVee

Discovering what’s online and on TV.

MeeVee is the leader in helping people navigate the growing world of online and television entertainment. Each month, over a million tech savvy, affluent and educated online users visit MeeVee to help make their entertainment choices.  These people are passionate about entertainment, and visit MeeVee again and again to track their favorites and to discover and share new entertainment choices.

Why? Today’s consumers are overwhelmed by the millions of online videos and hundreds of digital TV channels now available. MeeVee is the first destination to bring together traditional TV listings and online video from hundreds of sources in one place. Using our patented technology, consumers can personalize MeeVee to search for new TV and online video based on their interests. At MeeVee, our mission is to help them discover more of what they want to see.

Located in Burlingame, CA, MeeVee initially launched in 2005 as a television listings provider.  Using innovative new technologies, MeeVee changed the way consumers find TV programming by enabling them to personalize their guides to surface new programming choices based on people, shows, hobbies and keywords of interest. Now MeeVee is applying that same technology to the growing world of online video, helping individuals to cut through the clutter and discover interesting videos.  Today, MeeVee employs more than thirty enthusiasts who are passionate about our mission of helping consumers discover and enjoy the media they want to see. 

Supported by leading advertisers, including CBS, Netflix, Radio Shack and more, MeeVee also syndicates and licenses our television search and personalization services to leading newspapers, major online content providers and cable operators around the country. Our partners include some of the largest integrated media companies, including Gannett, Hearst and Media News Group. Our list of syndication partners is growing daily and includes USA Today, The Chicago Sun Times, San Francisco Chronicle and the Seattle Times.  Our investors, who have supported some of Silicon Valley’s most successful ventures, include JP Morgan, Labrador Ventures, Walden Venture Capital, Defta Partners, and Rothschild Ventures.

TechCrunch has called MeeVee, “an easy-to-use application and…a nice model for building a personalized web experience.”  MeeVee is a 2007 “Always On” Media 100 winner.

Well, in some of the latest posts about MeeVee on Techcrunch are surely not as positive as the sentence above and MeeVee is as of today put in the dead pool watch list.
More

http://meevee.com/
http://biz.yahoo.com/bw/080407/20080407006076.html 
http://www.techcrunch.com/2008/04/07/25-million-later-meevee-in-trouble/
http://www.crunchbase.com/company/meevee
http://www.techcrunch.com/2007/07/16/meevee-cuts-20-of-staff/
http://www.techcrunch.com/2007/09/20/meevee-takes-35-million-series-d/
http://www.econtentmag.com/Articles/ArticleReader.aspx?ArticleID=17395
http://findarticles.com/p/articles/mi_m0EIN/is_2006_Feb_27/ai_n16085490
http://www.techmeme.com/080407/p95#a080407p95
http://www.deftapartners.com/
http://www.labrador.com/
http://www.waldenvc.com/
http://www.jpmorgan.com/pages/jpmorgan/investbk/global/na/baef

Imeem confirms the acquisition of Snocap for reportedly less than $5M off more than $10M in venture capital taken by the company!

An acquisition that was announced in late February has today been confirmed. Imeem confirms the acquisition of Snocap. As we have then written Snocap has been in a long quest for a buyer (at least since Sept last year) and has gone through some massive layoffs, so it was clear the company had little to no options left but to sell off. Rumors have it that no other competitive buyers have ever shown up on the horizon and Imeem was the most logical buyer for Snocap.  Just like in February official terms were not disclosed, but some insiders have speculated the price tag has been less than $5M. What we do not understand is how a company with over $10M in venture capital money and quite solid technology has ended up selling itself under fire. Imeem is known to have been licensing the company’s digital fingerprinting technology to track how many times any particular song is streamed on its site so that it can allocate a portion of its advertising dollars to the major music labels.

Other rumors have it the total investment in Snocap is way over $10M with CSV II that is known to have made its first investment, leading a $15 million Series C round in Snocap, which happened in early 2006. Other technology bloggers have meanwhile speculated it has been a payday for Fanning (also the founder of Napster), but it is hard for us to believe in this knowing it’s pretty rare to see VC terms these days without some liquidation preferences that protect them against fire sales like this.

Imeem is being said it depends on Snocap’s digital fingerprinting technology for its entire business model, which has surely forced Imeem to buy the company. The Snocap technology matches the music to its database of 7 million songs, which then allows Imeem to allocate a portion of its advertising revenues to the music companies who own the copyrights to the songs.

After all being said for the two companies it still remains quite unclear for us why Snocap needed to sell. Pressured from investors or what? The lesson learned here for Imeem is that startups should not rely on other startups for the key technology that their business is built upon.

Snocap was founded in 2002 by Napster creator Shawn Fanning and Jordan MendelsonRon Conway is perhaps their angel investor. The company is known to have taken $10M million from Conway, Morgenthaler Ventures and WaldenVC. Just like Imeem’s deal with Universal Snocap has also signed a distribution deal with MySpace. In fact Imeem and Snocap have also partnered in the past where Imeem used Snocap’s digital fingerprinting technology to track how many times any particular song is streamed on its site so that it can allocate a portion of its advertising dollars to the major music labels.

More about Imeem

Imeem is an online community where artists, fans & friends can promote their content, share their tastes, and discover new blogs, photos, music and video. Here are some of the things you can do on imeem:

Discover
-Enjoy the latest videos, music, photos, or blogs posted on imeem.
-Stay up-to-date with your personal network of fans and friends with “What’s New” notifications.
-Get in-depth stats for all your content and track their popularity.

Interact
-Tag, comment, rate, and share any of your friends’ cool (or embarrassing) content.
-Create or join groups for your favorite band, event, topic, and more!
-Start discussions with other imeem users and make new friends.
 
Share
-Embed your media on other pages (such as your blog, Bebo, etc.).
-Recommend stuff to your friends or add it to your “Favorites” list.
-Easily add media to your Del.icio.us, WordPress, Blogger, or Typepad.

Imeem is hoping to make money from advertisers, a portion of which will be shared with its music partners. It has signed up Puma, Nike and Microsoft among others, though it does not disclose revenues.

This is Imeem’s second acquisition after they acquired Anywhere.FM in January. Imeem has raised two rounds of capital, although the size of the second round was not disclosed.

Imeem is based in San Francisco and takes its name from “meme” – a term coined to describe the ideas that communities, adopt, and express. Dalton Caldwell is the CEO of the company and the co-founded together with Jan Jannink. The company used to be in Palo Alto and is known to have launched in 2004. Known investors in the company are Morgenthaler (Series A founding) and Sequoia Capital, the venture capital fund that supported Google and YouTube.

It is interesting to know what Imeem’s total funding is considering the fact Snocap has raised $10M. Imeem’s first round was only for $750K. Imeem does not disclose revenues.

Some competitors and similar companies include Skreemr, Seeqpod, Deezer, Pandora, Lala, MOG, we7 and Wixi.

More

http://web2innovations.com/money/2008/03/01/snocap-has-been-acquired-by-imeem/
http://www.stanwichadvisors.com/docs/CSV%20Press%20Release.pdf
http://www.techcrunch.com/2008/02/17/who-bought-rupture/
http://www.techcrunch.com/2008/04/07/imeem-confirms-snocap-acquisition/
http://snocap.com/
http://Imeem.com
http://www.crunchbase.com/company/imeem
http://www.techcrunch.com/2008/02/13/imeem-acquires-snocap/
http://web2innovations.com/money/2007/12/10/exclusive-imeem-inks-a-deal-with-the-worlds-largest-record-company/
http://www.techcrunch.com/2006/09/02/myspace-gets-into-music-biz/
http://www.techcrunch.com/2007/06/20/imeem-now-officially-legitimate/

Snocap has been acquired by Imeem

Snocap was known to be searching for a new home for quite some time and it seems they have shopped themselves successfully as Imeem has bought them last month. Snocap is digital music wholesaler and Imeem is music streaming site so the synergy seems quite logical here. Terms were not disclosed publicly.

Snocap was founded in 2002 by Napster creator Shawn Fanning and Jordan MendelsonRon Conway is perhaps their angel investor. The company is known to have taken $10M million from Conway, Morgenthaler Ventures and WaldenVC. Just like Imeem’s deal with Universal Snocap has also signed a distribution deal with MySpace. In fact Imeem and Snocap have also partnered in the past where Imeem used Snocap’s digital fingerprinting technology to track how many times any particular song is streamed on its site so that it can allocate a portion of its advertising dollars to the major music labels.

It seems Imeme was in desperate need from the Snocap’s technology while Snocap needed a new home, which surely helped the deal happen.
 
Snocap has gone through significant layoffs and was rapidly heading towards major failure. The company’s key person Shawn Fanning was also planning to leave the company and deal with his new creature Rupture.

More about Imeem

Imeem is an online community where artists, fans & friends can promote their content, share their tastes, and discover new blogs, photos, music and video. Here are some of the things you can do on imeem:

Discover
-Enjoy the latest videos, music, photos, or blogs posted on imeem.
-Stay up-to-date with your personal network of fans and friends with “What’s New” notifications.
-Get in-depth stats for all your content and track their popularity.

Interact
-Tag, comment, rate, and share any of your friends’ cool (or embarrassing) content.
-Create or join groups for your favorite band, event, topic, and more!
-Start discussions with other imeem users and make new friends.
 
Share
-Embed your media on other pages (such as your blog, Bebo, etc.).
-Recommend stuff to your friends or add it to your “Favorites” list.
-Easily add media to your Del.icio.us, WordPress, Blogger, or Typepad.

Imeem is hoping to make money from advertisers, a portion of which will be shared with its music partners. It has signed up Puma, Nike and Microsoft among others, though it does not disclose revenues.

This is Imeem’s second acquisition after they acquired Anywhere.FM in January. Imeem has raised two rounds of capital, although the size of the second round was not disclosed.

Imeem is based in San Francisco and takes its name from “meme” – a term coined to describe the ideas that communities, adopt, and express. Dalton Caldwell is the CEO of the company and the co-founded together with Jan Jannink. The company used to be in Palo Alto and is known to have launched in 2004. Known investors in the company are Morgenthaler (Series A founding) and Sequoia Capital, the venture capital fund that supported Google and YouTube.

It is interesting to know what Imeem’s total funding is considering the fact Snocap has raised $10M. Imeem’s first round was only for $750K. Imeem does not disclose revenues.

Some competitors and similar companies include Skreemr, Seeqpod, Deezer, Pandora, Lala, MOG, we7 and Wixi.

More

http://snocap.com/
http://Imeem.com
http://www.crunchbase.com/company/imeem
http://www.techcrunch.com/2008/02/13/imeem-acquires-snocap/
http://web2innovations.com/money/2007/12/10/exclusive-imeem-inks-a-deal-with-the-worlds-largest-record-company/
http://www.techcrunch.com/2006/09/02/myspace-gets-into-music-biz/
http://www.techcrunch.com/2007/06/20/imeem-now-officially-legitimate/