Tag Archives: Venture Capital

Bootstrapping: Weapon of Mass Reconstruction

“Sramana Mitra’s Bootstrapping: Weapon of Mass Reconstruction is a book for our time because it’s something real out of Silicon Valley. No more stories about legendary VC fundings of startup-to-IPO in six months. …This book has some fascinating histories of the different paths people take to entrepreneurship, and the difficulties they face. I would only have wished each of the interviews to be longer and deeper, because every story is worth telling.” – Fast Company

In a world battered by economic crisis, Sramana Mitra believes entrepreneurship is the only sustainable path forward to a healthy economic world order. And core to the success of entrepreneurial ventures today is the invigorating art of bootstrapping. Sramana Mitra–a serial entrepreneur, strategy consultant and Forbes columnist–takes aim at this essential route along the roadmap to startup success with Bootstrapping: Weapon of Mass Reconstruction (Entrepreneur Journeys Vol. 2; BookSurge; June 1, 2009; $16.95 paperback).

Along with the incisive analysis and commentary that have popularized popularized her blog “Sramana Mitra on Strategy” and Forbes columns, Mitra showcases a dozen successful entrepreneurs and their lessons from the bootstrapping trenches. Overflowing with lively entrepreneurial tangents, theories and behind-closed-doors-experience, the book rises to the level of economic policy discussion while simultaneously offering practical advice from experienced bootstrappers. Important issues like doing more with less, getting started with little or no capital, and validating the market on the cheap are discussed with the likes of Om Malik of GigaOm and Greg Gianforte of RightNow.

In her characteristic narrative style, Mitra shepherds established and aspiring entrepreneurs through another inspiring and page-turning expedition into venture land, a territory she hopes will be claimed by many more in the years to come.

“From my perspective it is clear that small business must be a top policy priority,” explains Mitra. “Let us hope that in the coming decade the number of small businesses will double, then triple and quadruple. For here is the most powerful engine of economic growth and sustenance. Here is our way back.”

More Praise for Bootstrapping:

“Mitra clearly has a passion for small businesses. This useful volume is largely comprised of interviews with the founders of such companies. Her skilled questioning prompts a discussion of the many issues involved in starting and growing a business. The entrepreneurs share wisdom and insight useful to any budding or existing business owner. The reader will be struck by the vision, inventiveness and sheer determination of these entrepreneurial heroes, who operate businesses that are successful but far below the radar. A highly relevant and timely work on entrepreneurship’s role in economic reconstruction.” – Kirkus Discoveries

“Sramana’s work on bootstrapped entrepreneurs is an inspiration in these tough economic times. The solutions to our economic problems ultimately lie with the entrepreneur who brings imagination, resourcefulness and good old-fashioned elbow grease to tackle old problems in new ways, create new solutions and new industries. It is all too easy to forget this, particularly when we feed on the depressing daily diet of endless bailouts and hear trillions of dollars being thrown around. A great entrepreneur can do a lot with ten thousand dollars. This book is a good antidote to the depressing mood of these times.” – Sridhar Vembu, CEO of AdventNet and Zoho, Bootstrapped to over $50 million in annual revenue

“In the end, a true entrepreneur will not be denied. What Sramana captures with simple grace are the riveting personal stories of modern day business alchemists, who mix vision, pragmatism and relentless effort to forge creative new and successful ventures. Her collection of interviews will make for an engaging, educational read, for those in the entrepreneurial space, those considering joining the game and those just plain curious about the formative innovators whose efforts provide outsize social returns of the most concrete and enduring nature.” – Don Hutchison, Silicon Valley Angel Investor

ABOUT THE AUTHOR: Sramana Mitra is a technology entrepreneur and strategy consultant in Silicon Valley. She has founded three companies, is a columnist for Forbes, and writes a business blog, Sramana Mitra on Strategy (www.sramanamitra.com). She has a master’s degree in electrical engineering and computer science from MIT.

Via EPR Network

Facebook raised $100M more, total is now at $493M

Facebook keeps on growing so does its expenditures. The latest news from the company is that they have raised yet another $100M round of funding. The company says this time all the money will go for buying servers, lots of servers. BusinessWeek has estimated they are going to scale things up with 50,000 new servers on top of their 10,000 they are currently running on. Total amount of money raised by Facebook is now $493M (we did the math and it seems $438M in total, but other more reliable sources claim it is $493M) according to several sources. This time, however, the founding is not against equity, but is a venture lending deal with TriplePoint Capital, a Menlo Park, Calif. based company that specializes in lending money to startups. Facebook already claims 109M monthly unique visitors and many people say the site is at times very slow.

Venture lending peaked during the dot-com bubble of the late 1990s and early part of this decade, but is making a comeback as startups use debt to pay for computer servers, telecom gear, and software. “The last thing the entrepreneur wants to do is see those precious equity dollars flowing into equipment purchases,” says TriplePoint CEO Jim Labe. “It’s a very unproductive use of equity to plow it into fixed assets.”

Forrester Research’s Gillett estimates that Google is buying half a million servers each year, while Microsoft’s annual consumption is as much as 200,000 servers.

Executives at Facebook declined to say which vendors will provide the servers. But the social network is already a big customer of Rackable Systems, which said in a recent financial statement that it derived $11.5 million, or 17% of $68 million in first-quarter revenue, from Facebook. This puts the total server expenditures of Facebook at $46M per year. With the new round this amount will significantly increase.

Facebook is hugely popular social networking site, second only to MySpace in terms of users. Other popular social networking sites are Bebo and Friendster, the second one tried to acquire Facebook in 2004 for just $10M.

The latest comScore metrics, we have seen, revealed that Facebook is actually havingo ver 100M unique visitors per month.

Peter Thiel, cofounder of PayPal and managing partner of the Founders Fund was the first angel investor in the company. He invested $500,000 into Facebook in early 2004. Later Accel Partners poured $12.7 million more in funding, at a valuation in the $100 million range.

The next year [2006], Facebook received $25 million in funding from Greylock Partners and Meritech Capital, as well as returning investors Accel Partners and Peter Thiel. The pre-money valuation for this deal was in the $525 million range.

Facebook is reported to have turned deals down from Friendster, Yahoo, Viacom  and the mighty Google a few months ago when Zuckerberg has chosen Microsoft to partner with. Microsoft de-facto has invested $240 million into Facebook for just 1.6 percent of the company in October 2007. This put the company’s valuation at over $15 billion on just $150 million in annual revenues.

More

http://www.facebook.com/
http://www.tpcp.com/
http://www.rackable.com/
http://www.techcrunch.com/2008/05/10/facebook-raises-another-100-million/
http://www.businessweek.com/technology/content/may2008/tc2008059_855064.htm
http://mashable.com/2008/05/09/facebook-triplepoint-funding/
http://venturebeat.com/2008/05/09/facebook-borrows-100m-to-build-out-its-infrastructure/
http://gigaom.com/2008/05/11/the-rising-cost-of-facebook-infrastructure/
http://www.marketwatch.com/news/story/hong-kong-tycoon-li-raises/story.aspx?guid=%7BE4097AA2-9EA3-4773-9100-456E68EE1C9A%7D
http://www.allfacebook.com/2008/03/facebook-gets-another-40-million/
http://www.techcrunch.com/2008/03/27/hong-kong-billionaire-puts-another-40-million-into-facebook/
http://mashable.com/2008/03/27/facebook-hutchinson-investment/
http://web2innovations.com/money/2007/11/30/hong-kong-billionaire-li-ka-shing-invests-60m-in-facebook-funding-totals-33820m-to-date/
http://gigaom.com/2008/03/27/facebook-soon-to-appear-in-3g/
http://www.facebook.com/apps/application.php?id=2915120374&b
http://gigaom.com/2008/03/13/lets-justify-facebooks-300-per-user-valuation/
http://www.crunchbase.com/company/facebook
http://www.techcrunch.com/2007/11/30/another-60-million-for-facebook/
http://kara.allthingsd.com/20071130/facebook-nabs-60-million-investment-from-li-ka-shing/
http://www.hutchison-whampoa.com/eng/about/chairman/chairman.htm

Meebo raised $25M on reportedly $200M pre-money

The rumors were lately that Meebo failed to sell and that’s why it went into this new round of funding instead and not at the initial $250M pre-money valuation they were hoping for but at $175 – $200M (as it seems $200M). Some sources claim that companies like Fox/MySpace and AOL have taken a long look at the company, but ultimately passed based on the price.

A couple of days ago it went official that Meebo has taken a $25 million third round of financing from Jafco Ventures, Time Warner Investments and KTB Ventures. Previous investors Draper Fisher Jurvetson and Sequoia Capital are said to have also participated.

With this round Meebo’s only exit might be the IPO road, which for a company with little to no revenues is not that easy to accomplish. If the new investors are looking for 2x or 3x their money at the exit it would be hard for Meebo to sell itself out for anything less than $500M or go for an IPO, which for a company with little to no revenues is kind of unbelievable for us to happen.

Meebo is a popular and rapidly growing web based instant messaging start up that was backed up by Sequoia Capital and is said to have roughly 4.6M unique visitors per month according to comScore’s publicly available stats. That’s valuing each of their visitors at the $54 mark, which is significantly more than what AOL has just recently paid for each of Bebo’s 22M visitors – $39 according our simple math. Many industry experts, commentators and bloggers have expressed their negative feelings about the potential deal and more concrete about its pre-money valuation. Anyone remember Slide and their pre-money valuation of $500M? Yet it was said then they had over 150M or so users worldwide, which, if true, valued their users at the $3 range.  

There is however something most of the technology blogs seem to have overlooked. Joshua Beil from Level 3 Communications has commented on one of the tech blogs that Meebo’s per user valuation could change quite substantially if one takes into account their unique visitors of the MeeboMe rooms widget. I’ve seen, he says, numbers in the 10-14M range and counting for just this application. Factor this in to the 4.6M uniques to Meebo.com and it’s at a discount to Bebo. We have no idea where he does take his numbers and what his affiliation with the company is, but if we take those numbers for real the $250M valuation does not sound ridicules anymore. In addition to that Venturebeat reports that Meebo has attracted 29 million monthly unique users worldwide, but they also say that some investors remain quite skeptical about Meebo and their business model. We have no clear idea where Venturebeat has come to that number of visitors.

Meebo launched in September 2005 and received funding from Sequoia Capital in December 2005 and Draper Fisher Jurvetson in January 2007. Today, Meebo’s users exchange over 100 million instant messages daily.In early 2007, Meebo gets another $9 million from Draper Fisher Jurvetson and Sequoia Capital. Skype’s lead investor and YouTube’s lead investor are teaming up. Tim Draper, one of the early investors in Skype, did the deal for DFJ. Meebo’s total funding is now $37.5 million.

More

http://www.meebo.com/
http://blog.meebo.com/about
http://www.monty.com/
http://www.techcrunch.com/2008/04/30/its-official-meebo-raises-25-million-from-jafco-time-warner-and-ktb/
http://www.techcrunch.com/2008/04/30/meebo-closes-big-funding-round/
http://www.techcrunch.com/2008/04/09/meebo-cant-get-their-price-go-for-a-fundraising-instead-of-sale/
http://www.conceptualist.com/2008/04/09/1-million-in-revenues-200-million-valuation/
http://web2innovations.com/money/2008/03/18/meebo-tries-to-raise-25m-in-return-of-only-10-equity-valuing-the-company-at-the-whopping-250m/
http://www.techcrunch.com/2008/01/31/meebo-turns-chat-rooms-into-a-web-service/
http://venturebeat.com/2008/03/17/meebo-raising-round-valued-up-to-250-million-bear-stearns-sold-for-236-million/
http://www.webware.com/8301-1_109-9896718-2.html?part=rss&tag=feed&subj=Webware
http://www.techcrunch.com/2008/03/18/is-meebo-worth-half-a-slide/
http://venturebeat.com/2007/01/18/im-service-meebo-growing-quickly-raises-more-cash/
http://www.techcrunch.com/2005/12/16/meebo-confirms-sequoia-funding/
http://web2innovations.com/money/2007/11/22/meebo-received-funding-from-sequoia-capital/
http://blog.meebo.com/?p=78
http://venturebeat.com/2006/08/02/meebome-lets-you-chat-directly-from-any-homepage/
http://venturebeat.com/2007/01/10/web-20-shakeout-continued-whats-up-at-insider-pages-meebo-others/
http://www.crunchbase.com/company/meebo
http://www.techmeme.com/080318/p7#a080318p7
http://quantcast.com/meebo.com
http://siteanalytics.compete.com/meebo.com?metric=uv
http://web2innovations.com/money/2008/03/14/22m-uniques-mo-site-bebo-goes-to-aol-for-850m-in-all-cash-deal/
http://www.techcrunch.com/2008/01/18/slide-gets-their-huge-valuation-and-raises-50-million/
http://www.crunchbase.com/financial-organization/montgomery-co
http://venturebeat.com/2007/12/06/meebo-partners-with-videoegg-to-help-app-developers-make-more-money/

VC deals show a decline in the first quarter of 2008

While angel investors are taking on venture capitalists and have last year invested as much as VCs did the VC deals show a decline in the first quarter of 2008. According to a new report from PricewaterhouseCoopers, venture capital investment in the United States headed south in the first quarter of 2008.

The report found that venture capital has dropped 8.5 percent to $7.1 billion in the three months ending March 31 from the $7.8 billion invested in the previous quarter, resulting in the lowest quarter since Q4 2006. Funding for early and late stage companies declined in the first quarter, though funding rose for expansion-stage companies. Some sources claim that new startups are being hit the hardest.

In more specific the VC money going into the software sector (including Internet, Web, IT) declined 9 percent quarter-over-quarter and flat year-over-year to $1.264B and is said to be equal with the amount invested in biotech companies ($1.267B). In perspective to the only Internet deals those declined 7 percent from the fourth quarter of 2007 to $1.310 billion, but were slightly up year-over-year. Clean tech investments have gone crazy and hit the peak in third quarter of 2007 during which period more than $851M was invested.

In the context of web 2.0 it could simply be the fact that it is dirty cheap lately to start a new web-2.0 company online and the VC money offered to those is always a bit more than what this company in particular needs from to get off the ground and stabilize. This could be seen as a reason why the VC deals for Internet only start-ups have slightly declined in the last 2 quarters. Another potential reason of this slight meltdown could be the fact that the first quarter of the calendar year is usually the quietest so part of the decline may be seasonal.

Yet, the most logical reason could be the overall economy meltdown in US, which might now have its impact over the VC market too.

More

http://www.pwc.com/
http://www.techcrunch.com/2008/04/18/is-the-venture-capital-party-over/
http://www.boston.com/business/articles/2008/04/19/venture_capital_funding_diminishes/
http://venturebeat.com/2008/04/18/its-official-venture-investment-declined-in-q1/
http://www.techcrunch.com/2008/04/20/vc-deals-in-charts-q1-2008%e2%80%94welcome-to-the-slowdown/
http://web2innovations.com/money/2008/04/18/angel-investors-have-invested-as-much-as-26-billion-in-start-ups-last-year-almost-as-much-as-vcs-did/
http://dondodge.typepad.com/the_next_big_thing/2008/04/angel-investors.html
http://www.techcrunch.com/2008/04/15/where-have-all-the-bold-vcs-gone/
http://www.nvca.org/ffax.html
http://www.paulgraham.com/googles.html
http://money.cnn.com/2006/02/28/magazines/business2/angelinvestor/

Angel investors have invested as much as $26 billion in start ups last year, almost as much as VCs did

Today we have read over a few technology and business blogs that angel investors have poured $26B in start-up companies for the last year alone. Aside the fact this is an impressive amount of money it is also very close to what VCs did themselves – $29B. Furthermore the number of deals backed up by angels is way bigger than the number of deals venture capitalists closed – 57,120 vs. 3813 deals in behalf of the private investors. The sources also claim there are 258,200 active angel investors in the USA alone. The vast majority of the angel deals go for Software and Internet start-ups. Angel investors continue to be the largest source of seed stage and early stage start-up capital, with 39% of 2007 angel investments going there. Based on those reports it seems the angels most rely on mergers and acquisitions for their exits, while VCs are more inclined for IPOs.

Basically angels tend to invest just like VCs do except they do smaller investments $200K to $2M and they do about 15 times as many deals as VCs. In most cases angels have the same investment criteria and expectations of significant returns as the VCs look for. The average deal size (seed stage) is about $250K.

The larger angel groups in Silicon Valley and Boston do significantly more deals and invest between $350K and $600K per round, and maybe $1.5M to $2M per company.

The conclusion here is that launching a start-up company and then getting it off the ground is a whole lot cheaper today then it used to be some years ago. This somehow leaves most of the traditional VCs out of the game since either angel investors are beating them or the large Internet players are buying those start ups far before the VCs get their hands over them.

As Paul Graham from Y Combinator points out there is is growing gap between the $20K to $100k most angels will put in and the $2 million to $3 million that a venture firm will commit. He argues that what startups need are more investments somewhere in the middle to fill that gap. Most Web startups don’t need $2 million. They need $300,000 or $500,000. But most venture capitalists don’t think those types of investments are worth their while.

Some very active angel pools are as follows Keiretsu Forum, Band of Angels, Beacon Angels, Boston Harbor Angels, Common Angels, eCoast Angels, Hub Angels, Launchpad among others.

Here is an interesting list of tips for you on how to land an angel for your start up business.

(Picture by CNN)

More

http://dondodge.typepad.com/the_next_big_thing/2008/04/angel-investors.html
http://www.techcrunch.com/2008/04/15/where-have-all-the-bold-vcs-gone/
http://www.nvca.org/ffax.html
http://www.paulgraham.com/googles.html
http://money.cnn.com/2006/02/28/magazines/business2/angelinvestor/
http://wsbe.unh.edu/cvr
http://www.keiretsuforum.com/
http://www.bandangels.com/
http://www.angelcapitalassociation.org/
http://www.beaconangels.com/
http://www.bostonharborangels.com/
http://www.commonangels.com/
http://www.ecoastangels.com/
http://www.launchpadventuregroup.com/
http://www.hubangels.com/

Federated Media raises huge round of funding – $50M

 In a period full with launch of new ad networks and deals about such Federated Media has raised a huge amount of money – $50 million in a C round led by Oak Investment Partners and Omidyar Network as a returning investor from their first round. The rumor has it the company has turned down a $100M buy out offer some time ago and apparently they have chosen to go through the investors’ road. The pre-money valuation for this road is rumored to be in the $200M range, which off $22M in revenues the company is brining in per year is not that overvalued at all. The company claims to be reaching a collective audience of over 50M people in US per month, which is an impressive number, yet those eye bolls are under the control of the web publishers and they may leave, together with their visitors, any time they do not like what are being paid for bringing them in. The company’s current investment comes on top of $7.5M previously taken. Federated Media claims profitability reached in September 2007.

Oak Investment Partners is actually buying out a minority stake for their $50M and this is not really a typical funding deal as it turns out.

“Federated Media has a proven, profitable business model with some of the industry’s most knowledgeable people at the helm,” said Fred Harman, general partner at Oak, who will be joining the FM board of directors. “The company has shown clear leadership in the emerging conversational media ecosystem. FM represents some of the best publisher and advertiser content on the Web, and with productive industry relationships, the company is poised to do amazing things going forward.”

With expertise in custom, integrated conversational marketing campaigns, FM has developed deep and long-term relationships with leading brand marketers and advertising agencies. Over the last three years, the company has expanded beyond its technology roots into verticals including parenting, business & marketing, media & entertainment, video gaming, graphics arts, automotive and more.

“We’ve been an early and avid supporter of Federated’s model,” said Casey Jones, vice president of marketing at Dell. “We look forward to continuing our work with the company as it expands its business.”

FM’s full portfolio of digital media brands includes web favorites such as Boing Boing, Ars Technica, Ask A Ninja, Digg, Dooce, Confessions of a Pioneer Woman and NOTCOT, as well as social networking applications including Graffiti Wall (in Facebook, Hi5, MySpace and other social networks), Watercooler (in Facebook, Bebo and others) and many more. FM is expanding its portfolio and has just this year brought on diverse sites such as Silicon Alley Insider, Destructoid and Buzzine. FM also manages sponsorship programs for a roster of events such as the twice-annual Conversational Marketing Summit and Outside Lands Music & Arts Festival.

“FM and Oak are a great match,” said Chris Albinson, co-founder and managing director of Panorama Capital, an early investor and board member at FM. “Oak will add great value to FM’s board, and we look forward to working with Fred and his team.”

FM generates revenue for its partner sites and event organizers through integrated sponsorships, advertising and other marketing services for global brands and their advertising agencies. Recent examples of premium brand-building programs include BMW’s 1-Series drawing contest, which invited Facebook members to custom paint BMW models using Graffiti’s digital illustrating tools, and the co-publishing and promotion partnership with American Express around their OPEN Forum blog for small business owners.

“We’re proud to bring Oak on board as major investor,” said John Battelle, founder and CEO of Federated Media. “The Oak team understands the media business and has relationships within the media and Internet industries that will benefit FM with insights from Silicon Valley as well.

More about Federated Media (FM)

Founded in 2005, FM represents more than 125 conversational media entrepreneurs who run more than 150 of the world’s most respected websites, blogs, and social networking applications. The company became profitable in the third quarter of 2007.

Federated Media (FM) is an advertisement serving company that works with many of the top blogs on the web. It acts as a middle man that connects medium sized websites/companies with large and small advertisers. FM is essentially an ad aggregator for companies that are too small to have direct relationships with big advertisers yet big enough to demand higher rates than available on services such as Google’s Adsense. It can distribute ads to numerous blogs helping advertisers and ad publishers avoid an overwhelming amount of business relationships.

FM does banner as well as text advertising on a CPM (cost per impression) basis. Pricing varies per blog property and can reach upwards of $30 per thousand impressions.

Founder is John Battelle

John Battelle is an entrepreneur, journalist, professor, and author who has founded or co-founded businesses, magazines and websites. Formerly a professor at the Graduate School of Journalism at the University of California, Berkeley, Battelle, 42, is also a founder and Executive Producer of the Web 2.0 conferences and “band manager” with BoingBoing.net. Previously, Battelle was founder, Chairman, and CEO of Standard Media International (SMI), publisher of The Industry Standard and TheStandard.com. Prior to founding The Standard, Battelle was a co-founding editor of Wired magazine and Wired Ventures. Before Wired, Battelle worked at the Los Angeles Times and MacWeek, a unit of Ziff Davis. John is currently CEO and Chairman of Federated Media.

In 2005-6, Battelle wrote The Search: How Google and Its Rivals Rewrote the Rules of Business and Transformed Our Culture (Penguin/Portfolio), an international bestseller published in 26 languages. He maintains Searchblog, a daily site covering the intersection of media, technology and the internet at www.battellemedia.com.

Battelle was a founding Board member of the Online Publishers Association and sits on the board of the Interactive Advertising Bureau, as well as the Board of his children’s school.

Battelle has been named a “Global Leader for Tomorrow” and “Young Global Leader” by the World Economic Forum in Davos, Switzerland. He was a finalist in the “Entrepreneur of the Year” competition by Ernst & Young and has recently been named an “Innovator,” one of ten best marketers in the business, by Advertising Age and one the the “Most Important People on The Web” by PCWorld. He holds a bachelor’s and a master’s degree from the University of California, Berkeley.

Investors include Omidyar Network, New York Times, Mitchell Kapor, Andrew Anker, Mike Homer, Tim O’Reilly, JP Morgan and Oak Investment Partners, which has given the money for their last and biggest round to date.

More about Oak Investment Partners

Oak Investment Partners is a multi-stage venture capital firm with a total of $8.4 billion in committed capital. The primary investment focus is on high growth opportunities in Internet/new media, communications, information technology, financial services information technology, healthcare services and consumer retail. Over a 28-year history, Oak has achieved a strong track record as a stage-independent investor funding more than 450 companies at key points in their lifecycle. Oak has been involved in the formation of companies, funded spinouts of operating divisions and technology assets, and provided growth equity to mid- and late-stage private businesses and to public companies through PIPE investments.

The space is very crowded and among other competitors Technorati is one of the companies holding greater chance for turning its fairly popular online brand into an ad network for blogs

More

http://federatedmedia.net/
http://www.federatedmedia.net/press/2008/04/federated_media_receives_inves.php
http://www.oakvc.com/
http://www.crunchbase.com/company/federatedmedia
http://www.techcrunch.com/2008/04/15/federated-medias-50-million-c-round-confirmed%e2%80%94no-plans-to-buy-up-blog-partners/
http://www.techcrunch.com/2008/03/21/federated-medias-battelle-slams-rival-hints-at-investing-in-publishers/
http://www.techcrunch.com/2008/03/21/federated-medias-battelle-slams-rival-hints-at-investing-in-publishers/
http://www.crunchbase.com/person/john-battelle
http://web2innovations.com/money/2008/03/02/technorati-is-rumored-to-be-in-preparation-of-blogger-ad-network/

The $250M pre-money seems did not work for Meebo and they go now for $175M

The rumor has it that Meebo fails to sell to date and is may be trying to raise new round of funding instead and not at the initial $250M pre-money valuation they were hoping for but at $175 – $200M. Some sources claim that companies like Fox/MySpace and AOL have taken a long look at the company, but ultimately passed based on the price. Perhaps it has something to do with the simple fact Meebo has only generated $1M in revenues since it launched.

Meebo is now said to be looking for private equity funds and major internet companies to possibly raise their next round at the whopping pre-money they have set for themselves. The same rumor is now saying that the same potential buyers that have passed on a possible acquisition deal are probably going to participate in Meebo’s new round. 

Meebo is a popular and rapidly growing web based instant messaging start up that was backed up by Sequoia Capital and is said to have roughly 4.6M unique visitors per month according to comScore’s publicly available stats. That’s valuing each of their visitors at the $54 mark, which is significantly more than what AOL has just recently paid for each of Bebo’s 22M visitors – $39 according our simple math. Many industry experts, commentators and bloggers have expressed their negative feelings about the potential deal and more concrete about its pre-money valuation. Anyone remember Slide and their pre-money valuation of $500M? Yet it was said then they had over 150M or so users worldwide, which, if true, valued their users at the $3 range.  

There is however something most of the technology blogs seem to have overlooked. Joshua Beil from Level 3 Communications has commented on one of the tech blogs that Meebo’s per user valuation could change quite substantially if one takes into account their unique visitors of the MeeboMe rooms widget. I’ve seen, he says, numbers in the 10-14M range and counting for just this application. Factor this in to the 4.6M uniques to Meebo.com and it’s at a discount to Bebo. We have no idea where he does take his numbers and what his affiliation with the company is, but if we take those numbers for real the $250M valuation does not sound ridicules anymore. In addition to that Venturebeat reports that Meebo has attracted 29 million monthly unique users worldwide, but they also say that some investors remain quite skeptical about Meebo and their business model. We have no clear idea where Venturebeat has come to that number of visitors.

The rumor is that Meebo has hired Montgomery & Co. to represent them in a new fundraising round that may value the company at a $250M. An interesting competition is forming on the scene there between Montgomery & Co. and Allen & Co., which is lately the investment bank behind pretty much all hot start ups that sold (got funded) or about to for hefty amounts (hefty valuations) in the valley such as Digg, Bebo, Slide, Technorati, among others.

What is also being said is that the company is looking to raise $25-30M in venture funding and if the valuation numbers are taken for real it means the VCs will take no more than 10% from Meebo. This is a whole lot more than the $60-70M that it was reportedly worth after a funding round last year.

More about Meebo

Meebo launched in September 2005 and received funding from Sequoia Capital in December 2005 and Draper Fisher Jurvetson in January 2007. Today, Meebo’s users exchange over 100 million instant messages daily.In early 2007, Meebo gets another $9 million from Draper Fisher Jurvetson and Sequoia Capital. Skype’s lead investor and YouTube’s lead investor are teaming up. Tim Draper, one of the early investors in Skype, did the deal for DFJ. Meebo’s total funding is now $12.5 million.

More about Montgomery & Co.

Montgomery and Co. was founded in 1986 with a vision of providing strategic capital-formation advisory services to leading aerospace, defense and related technology companies.

Montgomery & Co. took advantage of the technology downturn and consolidation in the banking industry in 2000 to establish its reputation as the “go to” bank for growth companies that wished to evaluate their strategic options and raise capital. In doing so, Montgomery & Co. fulfilled its initial vision of providing a range of advisory services that encompassed M&A, private placements, comprehensive business-development analyses, and other value-added services.

In 2002 the firm was strengthened by investments from the world’s biggest bank, Mitsubishi UFJ, and West River Capital, of Seattle, WA. In 2003 the firm opened offices in Seattle, San Francisco and San Diego. At that time, the firm also significantly expanded its banking expertise within the healthcare and media industries, especially in the M&A practice.

In 2005, the firm was further strengthened by an investment from Tudor Investments which is the venture capital and private equity arm of Tudor Investment Corporation, an internationally recognized diversified investment management firm with $11.7 billion in assets.

We think a deal is on the go and might not be a funding one, but the price would definitely be much lower than the $200/250M they were hoping for.

More

http://www.meebo.com/
http://blog.meebo.com/about
http://www.monty.com/
http://www.techcrunch.com/2008/04/09/meebo-cant-get-their-price-go-for-a-fundraising-instead-of-sale/
http://www.conceptualist.com/2008/04/09/1-million-in-revenues-200-million-valuation/
http://web2innovations.com/money/2008/03/18/meebo-tries-to-raise-25m-in-return-of-only-10-equity-valuing-the-company-at-the-whopping-250m/
http://www.techcrunch.com/2008/01/31/meebo-turns-chat-rooms-into-a-web-service/
http://venturebeat.com/2008/03/17/meebo-raising-round-valued-up-to-250-million-bear-stearns-sold-for-236-million/
http://www.webware.com/8301-1_109-9896718-2.html?part=rss&tag=feed&subj=Webware
http://www.techcrunch.com/2008/03/18/is-meebo-worth-half-a-slide/
http://venturebeat.com/2007/01/18/im-service-meebo-growing-quickly-raises-more-cash/
http://www.techcrunch.com/2005/12/16/meebo-confirms-sequoia-funding/
http://web2innovations.com/money/2007/11/22/meebo-received-funding-from-sequoia-capital/
http://blog.meebo.com/?p=78
http://venturebeat.com/2006/08/02/meebome-lets-you-chat-directly-from-any-homepage/
http://venturebeat.com/2007/01/10/web-20-shakeout-continued-whats-up-at-insider-pages-meebo-others/
http://www.crunchbase.com/company/meebo
http://www.techmeme.com/080318/p7#a080318p7
http://quantcast.com/meebo.com
http://siteanalytics.compete.com/meebo.com?metric=uv
http://web2innovations.com/money/2008/03/14/22m-uniques-mo-site-bebo-goes-to-aol-for-850m-in-all-cash-deal/
http://www.techcrunch.com/2008/01/18/slide-gets-their-huge-valuation-and-raises-50-million/
http://www.crunchbase.com/financial-organization/montgomery-co
http://venturebeat.com/2007/12/06/meebo-partners-with-videoegg-to-help-app-developers-make-more-money/

fix8 takes more money to fiddle around animated avatars

It was just a few months ago when fix8 took their first round of funding from Vickers Venture Group. The amount taken was then $3M. Vickers Venture Group is a Singapore-based private equity firm. This time the company says it has landed SK Telecom, which is a leading South Korean telecom, taking some $3M more to make it $5M in total funding. Fix8’s first part of the funding took place last year in October. 

SK Telecom has also awarded Fix8 a contract “to lead the development of SKT’s 3D avatar animation technology to enhance mobile and online communications.”

Fix8 is a web cam avatar community that lets you create animated avatars with your web cam by reading your expressions and gestures. When we took a look into their web site we have discovered tons of tools that you can play around with, including fix8’s wide selection of pre-made avatars and other accessories like voice manipulation, graphics and editing tools. Those clips can easily be embedded in your website or social networking profile, or use it for your instant messaging client like AOL, MSN, Skype or Yahoo Messenger.

Fix8 has recently teamed up with a couple of other companies like Pringo and Stickam. fix8 has also expanded its signature technology through a key partnership with Shanghai Media Group (SMG) offering Auditions(TV) to create a new world of Interactive TV where audiences can submit fix8 content for insertion into LIVE or taped programming. fix8 will further bridge the gap between communication devices with the launch of fix8 MOBILE.

Fix8 has also teamed up with Camfess, the premier site for online confessions. The ability to choose your own level of “incremental anonymity” and “confess” without anyone knowing who you are makes Camfess and Fix8 the “perfect fit.”

While we kept on researching around for more information we came across the following user review on the service. Gave it a try for fun. The idea is great but they have a way to go.

  1. It does not work if you have glasses on, and some people’s eyes do not work with them off.
  2. I did not play around long enough to have my body in the picture also, but from the image above it seems the avatar sits in front of the user. It needs to be placed around them so that when users turn their heads sideways, you can not see their head, but the side of the avatar’s head.
  3. It could not see my mouth moving unless I tilted my head backwards so as to get more light on my face (I have a fluorescent light above me so my room aint dark).

Fix8 is based in Sherman Oaks, CA and is a division of Mobinex, Inc.

More about fix8

Fix8 is a unique interactive communication application that allows people to customize their on-screen virtual appearance in real-time using avatar technology and creative accessories. Fix8 integrates human expression analysis and rendering capabilities, avatar/facial sculpting and animation technology, voice manipulation, and one click 3D face maker design capabilities in one package. Fix8 can create live streaming enhanced video to integrate into IM or other broadcast (such as TV) experiences, or record still images and fully-rendered videos.

While certain elements of the Fix8 product line can be found in the competitive landscape, the core technology to provide real-time animation in a consumer oriented application is unduplicated. Further, the specific feature set(s) offered in the Fix8 product line is unique and disruptive.

Fix8 differentiates itself from the competitive set by offering a unique easy to use application that incorporates avatar technology, 2D/3D facial accessories and flash animated accessories, voice masking and altering, and the ability to for a user to create their own individual set of avatars through use of photorealistic images all married with Fix8’s own IP that analyzes and renders human expressions so that the rich animated creations match the movements of the user in real-time for use in video and streaming.

Fix8 has coined the term user-generated reality to define the broad spectrum of creative self-expressive user-generated animation in real-time. Fix8 enhances the entertainment and enriches the communication experience of its clients’ customers by breathing new life into digital channels across multiple mediums.

The team

Linh Duy Tang, but you can call him “TANG”
President / CEO
 
Mr. Linh Tang is a senior executive (but he is really quite young at heart) with a demonstrated record of accomplishment in worldwide business operations. Tang’s vast experience in technology, operations and management make him the ideal fit to lead Fix8 on its mission to revolutionize virtual communication and expression. Tang is responsible for more than just Fix8’s vision and strategy; he is responsible for driving the “Innovation Bus” all the way to the user. A veteran of several startups with 15+ years in IT and consumer goods industries, Tang is – quite simply – THE MAN.
 
Chuning Ho, our very own voice of reason
Vice President of Operations
 
Ms. Chuning Ho brings over 17 years experience in application development, project deployment, executive management and business operations to the Fix8 team. As a founding member of the management team from initial start-up to present, Chuning knows where all the bodies are buried. Her main responsibilities include (but are not limited to) resources management, process standardization and communication strategy establishment and implementation. Chuning also manages to keep the entire team in check almost effortlessly. She is Fix8’s own secret weapon.
 
Scott Freeman, he sees dead people
Vice President of Finance
 
Mr. Scott Freeman brings extensive financial management experience to the Fix8 team. Scott did hard time with Deloitte & Touche, working in their entrepreneurial division, before he made his move to California Suncare, Inc. where he was instrumental in growing the company from $3M in revenue to $45M and assisted in its sale to a private equity firm for approximately $88M. Long story short, Scott knows how to make money and can see a deal well over a mile away. With a wife that is a successful interior designer, a daughter who is an artistic savant and a son who is a terror on the soccer field, Scott doesn’t have to work but he believes in Fix8 and, honestly, someone needs to keep Jake and Dinesh in check.
 
Dinesh Bhatia, proving that there are nice guys in sales
Vice President of Sales
 
Mr. Dinesh Bhatia brings direct experience in the wireless, television, Internet and software industries to the Fix8 team. Dinesh is a pretty smart guy; he graduated from Washington University with double degrees in Electrical Engineering and Computer Science and a Master’s Degree in Biomedical Engineering from Imperial College, London. Dinesh loves the disruptive creation and generation process of the software development community and is responsible for building strong partnerships to enhance the Fix8 user experience through added competitions and connectivity. In his spare time, he loves fiddling around with computers, gadgets, his saxophone and keyboards, photography, astronomy and spending time with his family. Dinesh also loves long walks on the beach – but this is not a personals ad – so let’s stop here.
 
Raphael Ko, it is rumored that he has brothers named Donatello, Leonardo and Michelangelo
Vice President of Engineering
 
Mr. Raphael Ko brings extensive experience in software development and information technologies management to the Fix8 team. Directly responsible for Fix8’s engineering activities, Raphael has drawn upon his 10+ years in software development as well as managing key projects in wireless applications, ERP, and IT services. Raphael’s love of photography and digital imagery fit right in with the Fix8 mission. Not much is known about Raphael’s past, in fact we can’t exactly put our finger on his start date either. One day he just suddenly appeared, fully formed and working (in all honesty) harder than the rest of us, so we let him stay. We still don’t know how he has the time to do what he does and still read all those issues of “Conan the Future Boy;” but some questions are best left unanswered.
 
Hao Zhou, Kevin Bacon stole the idea of six degrees from this guy
Vice President for Sales – China
 
Hao Zhou is a senior executive with an outstanding background in digital television and the new media industry. Shortly after learning how to crawl, Hao began his career as a system engineer, and quickly his work history grew to include sales and promotions of CATV, digital TV, broadband business, indoor and lift media and wireless value-add business. You know that guy who can do anything and has somehow managed to have successfully had every job available in the time it took you to pour your morning coffee? Yeah, well, Hao’s that guy. Hao’s ambition is what has brought him to the Fix8 team with one simple mission: Make Fix8 the next star shining over greater China. If anyone can do it, it’s certainly Hao. He’s our very own Hercules.

About Vickers Venture Partners.

The Vickers Financial Group is the venture capital arm of the Vickers Capital Group, an Asian investment house investing in alternative assets. Vickers Venture Partners is a leading venture capital firm focusing on early stage, high growth companies focused on Asian markets. The firm’s competency stems from the fact that its decision-makers have been part of and hence well-acquainted with the pulse of diverse domains.
 
The market

From what we were able to dig up it seems the space is extremely crowded. The competition include weblin.com, Meez.com, SecondLife, mypictr, gizmoz.com, miieditor, simpsonsmovie.com, gickr.com, Gravatar.com, imvu.com, Zwinky, digibody.com, Faketown, doppelme, SitePal, gaiaonline, imbee, myrl.com, Kaneva, blogoscoped.com, mojikan, frenzoo.com, clickbeurs.nl, Mr. Picassohead, whyrobbierocks.com, weeworld, and voki.com, among others.

More

http://www.sktelecom.com/
http://fix8.com/
http://www.vickersfinancial.com/
http://www.pehub.com/article/articledetail.php?articlepostid=11271
http://www.techcrunch.com/2008/04/03/fix8-takes-2-million-series-a/
http://web2innovations.com/money/2008/02/17/fix8-has-taken-3m-for-animated-avatars-for-your-cam/
http://mashable.com/2007/10/15/fix8-funded/
http://www.techcrunch.com/2007/10/15/fix8-raises-3-million/
http://mashable.com/2007/09/12/avatars/
http://mashable.com/2007/06/26/fix8-stickam/
http://webmaster.stickam.com/2007/06/fix8_partners_with_stickam_to.html
http://www.camfess.com/contents.php?cid=16
http://www.techcrunch.com/2007/05/31/fix8-brings-computer-generated-animation-to-the-webcam/

 

Looks like SpinVox is about to get a real run for the money, Nuance enters their niche

Everything leads us to the simple conclusion that Nuance is taking on SpinVox’s voice-to-text technology. It has always been interestingly enough to see how pouring big VC money into an idea, market niche, product or solution is always attracting some bigger player to try and exploit it. It seems the case with SpinVox today is pretty much the same. Nuance Communications, Inc., (the bigger player) announced today at CTIA Wireless 2008  the “Nuance Voicemail to Text” . Offered via wireless carriers, transcribed messages are sent to users as SMS or email messages. This news is hard not to connect to SpinVox’s massive round of funding that took place just a few weeks ago.

“Converting voicemail to text is a powerful and simple concept. But implementing a highly scalable semi-automated service is far more complex and requires highly accurate speech recognition – technology that takes decades to develop,” said Steve Chambers, president, mobile and consumer services division, Nuance. “The Nuance Voicemail to Text Service integrates speech technology with over 3,000 Nuance transcriptionists, hosted in a Nuance-owned facility, with proven security, scalability, and reliability.” 

Nuance’s telco-grade Voicemail to Text service delivers high-quality readable messages in minutes, giving you quick access to accurate transcriptions of your voicemail messages. Your entire voicemail message is transcribed and delivered directly to your mobile device. Users don’t have to worry about writing down or losing information while on-the-go. Messages can be saved, indexed in an archive and retrieved anytime, anywhere.

Nuance has revolutionized voicemail to text through high levels of automation. Nuance can deliver the world’s most accurate solution for turning speech into text with Dragon NaturallySpeaking, the world’s leading proprietary speech recognition engine, backed by 400 patents worldwide and proven by millions of users over 10 years. Nuance’s own state-of-the-art speech technology is supported by 3,000 in-house transcriptionists, hosted in a Nuance-owned facility with “five nines” (99.999%) uptime and reliability.

While the early, direct to consumer model of voicemail to text services was needed for a proof-of-concept, Nuance is changing the model to bring speech-enabled services to the mobile consumer through carriers. Nuance hosts the Voicemail to Text for service providers, integrating it with any standard voicemail system. Callers simply leave a message on a voicemail system that’s Nuance-enabled, and the message is transcribed to text and sent back to the voicemail platform, which delivers it to users through different messaging mediums such as email or SMS.

Nuance Communications, Inc. (NUAN) is a $3.8B market capitalization company that generates over $600M (2007) in revenues per year.

As just like some other technology blogs have already noticed and commented on, we also think all this looks like SpinVox is about to get a real run for the money to justify its huge valuation of $500M pre-money!

SpinVox, a London based voice-to-text technology has just recently raised $100M round of funding from a bunch of high-profile investors among which are Goldman Sachs, GLG Partners, Blue Mountain Capital Management and Toscafund Asset Management. Some of those venture capitalists have surely been seriously upset today.

The service can basically be described as a solution that transcribes voicemails to text so that they can be more easily digitized, searched, and manipulated. SpinVox’s software works simply by converting a voicemail message into text, which it then e-mails to a computer or sends via SMS to a phone. It removes the need to dial one’s voicemail, punch in a password and listen to messages.

More about Nuance

Nuance Communications, Inc. (Nuance) is a provider of speech-based solutions for businesses and consumers worldwide. The Company’s speech solutions are designed to transform the way people interact with information systems, mobile devices and services. Nuance offers businesses and consumers value-added speech, dictation and imaging solutions that facilitate the way people access, share, manage and use information in business and daily life. The Company provides speech solutions to enterprise speech, mobility, and healthcare dictation and transcription markets. Nuance markets and distributes its products indirectly through a global network of resellers, including system integrators, independent software vendors, value-added resellers, hardware vendors, telecommunications carriers and distributors, and directly through its sales force and through the Company’s e-commerce Website.

More about SpinVox

We launched in 2005 through The Carphone Warehouse, The Link and other retail channels. Pretty soon we had over 130,000 regular users, with an unprecedented customer retention rate of 80%. People who started speaking through SpinVox soon found they couldn’t live without it.

SpinVox has since won major industry awards from people like the GSM Association, Red Herring and Ernst & Young. No, we’re not boasting, we’re just pleased. In fact we’re amazed at how SpinVox is changing people’s lives.

At the heart of SpinVox is our patented Voice Message Conversion System™ (or VMCS to keep it simple). It underpins everything we do – our retail, enterprise, service provider and global carrier services. It’s maintained on an enterprise-class hardware infrastructure by an expert management team, to meet the rigorous demands of global carriers and their customers. Which means it just works, brilliantly.

From retail brands and direct customers, to global carriers and Web 2.0 brands, we are leading the way in converging voice and screens. SpinVox products are used on five continents, in five languages, with new carrier and technology partners joining us every month. SpinVox has 300 employees and offices in nine countries.

Some other competitors include Jott, Pinger, SimulScribe, among others.

More

http://www.nuance.com/
http://www.nuance.com/vm2text/
http://www.nuance.com/naturallyspeaking/
http://finance.google.com/finance?&q=NUAN
http://wirelessspeech.blogspot.com/2008/04/nuance-challenges-spinvox-in-voicemail.html
http://mashable.com/2008/04/01/nuance/
http://www.ctia.org/conventions_events/wireless/
http://web2innovations.com/money/2008/03/21/spinvox-raises-100m-at-a-whopping-500m-valuation/
http://www.spinvox.com/
http://blog.spinvox.com/
http://www.spinvox.com/spinvox-secures-over-100-million-in-new-funding-round..html
http://www.moconews.net/entry/419-voicemail-to-text-firm-spinvox-raises-100-million-500-million-valuation/
http://www.techcrunch.com/2008/03/20/spinvox-translates-voice-to-text-service-into-a-100-million-round/
http://mashable.com/2008/03/20/spinvox-funded/
http://uk.techcrunch.com/2008/03/19/it-looks-like-spinvox-has-raised-50m/
http://www.reuters.com/article/marketsNews/idUKN1932303420080319?rpc=44
http://www.techcrunch.com/2008/02/13/your-phone-is-your-mic-spinvox-lets-users-talk-to-twitter-facebook-and-jaiku-europe-only/
http://www.spinvox.com/spinvox-targets-cambridge-for-speech-recognition-skills..html
http://en.wikipedia.org/wiki/Allied_Domecq
http://en.wikipedia.org/wiki/Pedro_Domecq
http://www.crunchbase.com/company/spinvox

Yet another Digg clone

Reading the blogs today we came across a new Digg like service (clone) called Publish2. Essentially the service is Digg meets del.icio.us aimed at journalists where anyone is said to be able to seed links in the system but only journalists are given with the chance to vote for them. However, one person testing the service has said about Publis2 “It’s like Delicious, I would never use the public part of the service, I’m too competitive to share my research with other journalists.” There are way too many Digg followers lately trying to catch up on the huge popularity (traffic) Digg generates, – well over 22M unique visitors per month. While every new start up in the same space holds its chances and brings some new interesting features on the table it is hard for us to believe anyone will ever get closer to what Digg’s today popularity is. The ideas are many, the executions are good but even Digg has yet to prove its business model, let alone those smaller players.

Publish2 has today announced $2.75M in series A round of funding coming from Velocity Interactive Group. The company’s founders are Robert Young and Scott Karp who are former GigaOm contributors. 

Other companies in the space include Digg, Reddit, Netscape’s Propeller.com, MSNBC’s Newsvine, Mixx, Pligg, among others.

More about Publish2

Publish2 is an online news aggregation platform, designed to empower journalists to discover, organize, and rank the most important news — to benefit their own reporting, their newsrooms, and all news consumers on the web.

If you are a journalist, you can register for the Publish2 Beta.

1. Easy Online Bookmarks

Bookmarking Tool

You can save interesting articles and story research with one click, tag your bookmarks to keep them organized, and access your bookmarks from any computer.

Private or Public

If you like, you can save your bookmarks privately for your own personal use. No one else will see your bookmarks. Or you can choose to save your bookmarks publicly to influence what others read.

For Reporters

Publish2 makes your research and reporting proccess a lot more efficient.

For Editors

Publish2 bookmarks can also be published on a blog or web site as “recommended reading” or article references (using an RSS feed of your bookmarks).

2. A Powerful News Aggregator

Power of the Link

Links determine what gets read online. Google’s search engine gets its power by interpreting links to content as “votes” for importance.

Front Page

Because Publish2 is exclusively for journalists, combining all of the bookmark “links” creates a powerful aggregator of the best articles. The more journalists bookmark a story, the higher it ranks in Publish2’s news aggregation — just as content rises higher in Google’s search results as more people link to it.

Take Back Control

It’s like Digg for professional journalists, who understand the news and are experts on their beats. By using Publish2, you’ll help promote high quality journalism and take back control from amateurs and algorithms.

For Reporters

You can influence what others read by choosing to save your bookmarks publicly.

For Editors You can use Publish2 as an editorial platform for creating compelling topical news aggregations, powered by the collective intelligence of journalists.

3. Professional Profile

Resume

Manage your online identity as a journalist

My Clips

Showcase links to your best reporting

#1 Search Result

Have your profile appear first when someone searches for you online

More

http://www.publish2.com/
http://publish2.com/register
http://www.techcrunch.com/2008/03/31/heres-a-screenshot-of-publish2/
http://gigaom.com/2008/03/31/publish2-velocity/
http://gigaom.com/2007/08/14/publish2-joins-the-social-news-party/
http://gigaom.com/author/gigarobertyoung/
http://venturebeat.com/2008/03/31/publish2-raises-a-round-aims-to-bring-more-journalists-to-the-web/
http://www.velocityig.com/

More instructional videos on the horizon

Creating educational and instructional videos, clips and episodes is something hot lately. The space is crowded and has just emerged from the popularization of the online video sector. MindBites is yet another player jumping the bandwagon. MindBites is a self-publishing platform and social marketplace for instructional content, which enables people to share their unique knowledge, skills and passions through audio and video lessons, earning money for themselves or for charity.

Creating a marketplace where user-generated content becomes a commerce-driven supply for those out there in need of instructional videos is something said to set MindBites apart from its competitors.

MindBites has just raised $1M in series A round of funding from True Ventures.

Jason Reneau is the company’s CEO and founder.

Competitors include Expert Village, VideoJug, Sclipo, Graspr, Instructables, SuTree, Howcast, among others.

More about MindBites

Who we are
Introducing MindBites, your place on the web to learn directly from other real people and share what you know with the world. A self-publishing platform and social marketplace for instructional content, MindBites enables people to share their unique knowledge, skills and passions through audio and video lessons, earning money for themselves or for charity. The result is a unique community of discovery with content that simply can’t be found anywhere else – from Teaching your Baby Sign Language, to Cooking Tandori Chicken, to Surviving a Knife Attack. By enabling people to learn, connect and share as never before, MindBites promises to revolutionize the way the world shares knowledge. MindBites – What do you know?

What We Believe
Our belief is that the world is at the dawn of a new era in the sharing of knowledge. Led by the ubiquity of the Internet and drastic improvements in the accessibility of digital media technology, we are experiencing the largest increase in the global sharing of knowledge since Gutenberg invented moveable type. The bottom line is that today we can be connected, from one mind to another, like never before in the history of the world (please speak in your best James Earl Jones voice). We are inspired to be living in such an exciting time and playing a part in these historic trends.

Our Team
Our team is an ever expanding group of unique, talented and fun (if not a little goofy) individuals. As a group, we have experience from such varied institutions as Whole Foods, Harvard Business School, Burnt Orange Productions, McKinsey and Company, FreeMarkets, and Kiva Systems, to name a few. We have worked in such areas as web development, e-commerce, professional education, TV and film production, design, sales, marketing and entrepreneurial ventures. Most importantly though, we’re a group that includes bad but aspiring chefs, gardeners, artists, bartenders, golfers and foosball players. We own old houses and have no idea how to fix them. We’d like to learn foreign languages, have dreamed of knowing martial arts, and are always trying to figure out how to use our latest technical gadget. Simply put, we love learning, and that’s why we’re here.

There are too many people who have already touched MindBites to mention, but to list a few: our development team is from Squeejee.com led by Wynn Netherland, Jeff Kramer designed and manages our infrastructure, and Matt Warchola built our smack player. Matt “MattDaddyC” Chapman is responsible for our funky web design, and John Rubio deserves credit for the original MindBites logo. Ellen Ambrose has been our author recruiter extraordinaire, and our production team has been a group effort from Brittanie Flegle, Keith Fraase, Matt James and Sarah Moore, among others. The bozo in the back of the boat manning the rudder (and sitting on top of the ice chest) is Jason Reneau. Happily swimming along behind the boat is Chelsea, our unofficial mascot. Shout out also to our ex-lead-developer-turned-doctor, Matt Sanders.

Our Technology
MindBites is built with Ruby on Rails and oodles of CSS goodness, with light sprinkles of Flash and AJAX thrown in for good measure. We serve our media in Flash and Quicktime (for the most part). MindBites simply wouldn’t have been possible without a bevy of fantastic open source software that makes our lives so much happier – thanks guys! We’ve built additional super-secret technology to keep the ship sailing smoothly even through troubled waters. We could tell you about it, but of course then we’d have to kill you…

On the production side, we have made a concerted effort to use consumer-level technology and tools. We film everything that we do or help out on with sub-$500 mini-DV camcorders, and we typically edit with Final Cut (although we dabble with a range of Windows and Mac software). Our most critical piece of technology though is our Braun coffeemaker, without which all MindBites productivity would screech to a halt.

More

http://www.mindbites.com/
http://blog.mindbites.com/
http://mashable.com/2008/03/20/mindbites/
http://www.crunchbase.com/company/mindbites
http://www.trueventures.com/
http://Squeejee.com

An online career community that connects people through personal relationships and affiliations

Doostang is an interesting concept built upon the belief that over 50% up to 70% of recruiting today is done through the personal network of contacts and a large portion of which is done by email communication. Using your personal network is the most effective way to find the right candidate for a position and to find the perfect job. It eliminates the need to either post a job to an irrelevant audience or to search through the multitude of jobs available on the Internet or newspapers that would be of no interest to you. Doostang provides the infrastructure to connect personal networks together and to create a natural quality filter for recruiting and job searching.

Essentially Doostang is an online career community that connects people through personal relationships and affiliations. Members use Doostang to share relevant career opportunities and to interact with one another.

Below is how Doostang is different.

Using traditional online job websites, we got frustrated. If you’re searching for a new position and looking through hundreds of jobs, you’re lucky to find one that interests you but probably won’t hear back. On the other hand, as a recruiter, you may often find yourself inundated with irrelevant resumes when posting a position online.

Doostang recognizes the power of good information, especially when it comes to your career. Over 70% of jobs are, after all, filled through referrals. Doostang’s network offers immediate access to relevant people and opportunities through shared friends.

We’ve seen students, those who are happily employed, those looking for an exciting new job, recruiters, and fans of the community invite their friends to join the Doostang Network. In fact, tens of thousands of people are on Doostang just to help. By being a member and connecting people who are looking for a job or candidate, you are also building your own network on Doostang. In doing so, you are making more opportunities available for yourself and your friends down the line should you ever need to change your job or look for a great candidate.

Shared jobs
Doostang’s motto is “reclaim your career”. It encourages its users to doo the same; share opportunities with your friends by posting any interesting jobs you receive on Doostang. Collaborating will create more job opportunities than those that currently exist for all of us today.

Groups and Forums
Create groups to interact with members from your school, company, or with similar interests. Post questions, suggestions, and answers to our forums, and engage the community in meaningful discussion.

The company’s founders are Mareza Larizadeh and Pavel Krapivin. Doostang, once used to be in San Francisco, is today based in Palo Alto, CA. The latest publicly available number of registered users with Doostang is 300,000.

The company has recently closed its $3.5M series A round of funding from Shasta Ventures. It comes on top of $1M angel round previously invested in the company.  Total funding is already $4.5M.

The space is extremely overcrowded with major players like Monster, LinkedIn and believed Facebook too, VisiblePath, among others.

More

http://www.doostang.com/
http://blog.doostang.com/
http://www.techcrunch.com/2005/07/17/profile-doostang/
http://www.techcrunch.com/2007/10/17/dollars-for-doostang/
http://www.businessweek.com/innovate/content/aug2007/id20070830_886412.htm?campaign_id=rss_tech
http://www.techcrunch.com/2007/10/17/dollars-for-doostang/
http://doostang.com/forum.asp
http://www.crunchbase.com/person/mareza-larizadeh
http://www.crunchbase.com/person/pavel-krapivin
http://www.shastaventures.com/

An Israeli sync start-up acquired for reportedly $25M

BeInSync Ltd., an Israeli-based provider of an all-in-one solution that allows users to backup, synchronize, share and access data online has been acquired by Phoenix Technologies for an undisclosed amount. However, Techcrunch has reported the company went for $25M.

Phoenix Technologies, based in Milpitas Calif., is a public company (PTEC) established in 1979 and designs, develops and supports core system software for personal computers and other computing devices. The Company’s product supports and enables the compatibility, connectivity, security, and manageability of the various components and technologies used in such devices. It sells these products primarily to computer and component device manufacturers. Phoenix Technologies has more than 300 employees and company’s today market capitalization was $426M on $47M revenues for the fiscal 2007.

BeInSync, on the other side, is just four and a half year old startup that is known to have raised $8M to date from several institutional investors like Alta Berkeley Venture Partners, Aviv Venture Capital Fund, and Eurofund. Looking at the numbers this seems not the dream exit for the investors – only $25M off $8M invested, but is perhaps better than nothing on the long term run considering the huge competition in the space of file sharing and synchronization among any type of devices from computers to mobile phones. The company’s founders are Tal Barnoach, Sharon Carmel, and Adi Ruppin.

The acquisition, which is anticipated to close within the next several weeks, represents yet another step by Phoenix in delivering on its PC 3.0 promise of Embedded Simplicity.

BeInSync’s technology redefines the way consumers and SMBs backup, access, share and protect documents, rich media files, and other important data. The company’s patent-pending, peer-to-peer technology allows users to seamlessly and securely access their latest files anytime and anywhere, automatically keeping files and folders ‘in sync’ and backed up across multiple computers, including home PCs, office PCs and laptops.

“This acquisition is a leap forward in our effort to redefine and significantly improve the PC experience by embedding simplicity for end users,” said Woody Hobbs, President and CEO of Phoenix Technologies. “PC 3.0 eliminates complexity and provides users with the kind of convenience they expect from their digital devices. We are bringing new benefits to the hundreds of millions of PC users globally who require built-in functionality on PCs by enabling secure and easy online access and collaboration and automated data protection to help them manage their digital lives.

“The integration of breakthrough synchronization technology from BeInSync will allow Phoenix and its customers to help end-users alleviate concerns about the loss of important files and to give them complete mobile freedom to access their data from any Internet-connected computer.”

Phoenix Technologies’ management team itself has extensive experience in synchronization technologies. Before joining Phoenix, Woody Hobbs served as President and CEO of Intellisync, a leader in wireless email and synchronization solutions, which was acquired in 2006 by Nokia.

“Given our past experience in synchronization solutions, it was fairly easy for us to identify the best possible technology existing out there that would fit in with our corporate vision and product strategy,” continued Hobbs. “We were very impressed with BeInSync’s people and their technology and we’re excited to work with them to transform data access and continuity for PC users in consumer and small business markets as well as in enterprise departments.

“End-users want to stay connected and always ‘be in sync’ with colleagues, friends, remote files and computer systems. We look forward to working with our OEM customers to make online synchronization and continuity a core part of the PC end user experience. Together, the two companies will meet a wider set of customer needs and have a significantly greater opportunity to enable PC OEMs to grow their markets.”

“We are very excited to be a part of Phoenix Technologies, the global leader in core systems firmware for PCs,” said Tal Barnoach, Founder and Chairman of BeInSync. “With this acquisition, Phoenix is extending its leadership in the PC industry to include products in its portfolio that will set the standard yet again for providing the best-in-class solutions to PC OEMs and their customers.”

Upon the closing of the acquisition, Sharon Carmel, Founder & Vice President of R&D at BeInSync, will join Phoenix as Vice President & Chief Scientist of Synchronization and Continuity Solutions and Phoenix will continue to maintain operations out of Tel Aviv, Israel. The two companies are developing integration plans that build on corporate similarities and the best business and product development practices from each company.

“Both Phoenix and BeInSync are passionate about creating and enabling great user experiences across the entire range of mobile PCs,” said Carmel. “Our combined teams will be a powerful force for innovation around emerging mobile computing platforms for delivering web-based data management and data protection solutions. PC 3.0 users will no longer be dependent on a single, stand-alone PC for access to their files and digital life. At the same time, Phoenix’s OEM customers will have new opportunities to differentiate their offerings, and provide additional value-added services as part of the PC sale.”

More about BeInSync

BeInSync redefines the way consumers and businesses access, share and protect their documents, photos, videos and music. With over 4 million downloads, BeInSync offers users complete freedom when dealing with their digital content, by allowing them to seamlessly sync, share, access and backup their data. Based on patent-pending secure peer-to-peer technology, BeInSync creates your own private data network that makes it easy to stay connected and always in sync with colleagues, friends, remote files and computers.

More about Phoenix Technologies

Phoenix Technologies Ltd. (Nasdaq: PTEC) is the global market leader in system firmware that provides the most secure foundation for today’s computing environments. The PC industry’s top builders and specifiers trust Phoenix to pioneer open standards and deliver innovative solutions that will help them differentiate their systems, reduce time-to-market and increase their revenues. The Company’s flagship products, AwardCore, SecureCore, FailSafe and HyperSpace, are revolutionizing the PC user experience by delivering unprecedented security, reliability and ease-of-use. The Company established industry leadership with its original BIOS product in 1983, has 155 technology patents and 139 pending applications, and has shipped in over one billion systems. Phoenix is headquartered in Milpitas, California with offices worldwide.

More

http://www.beinsync.com
http://www.beinsync.com/company/press-releases/press_release_phoenix_anouncement.php
http://www.phoenix.com
http://investor.phoenix.com/releasedetail.cfm?ReleaseID=301730
http://www.thecoils.com/2008/03/27/beinsync_exit/ (in Hebrew)
http://www.techcrunch.com/2008/03/26/beinsync-acquired-by-phoenix-technologies-for-25m/
http://www.crunchbase.com/company/beinsync
http://www.beinsync.com/
http://investor.phoenix.com/common/download/download.cfm?companyid=PTEC&fileid=183485&filekey=d858c202-a278-42bf-b2b4-23ce4ce3a404&filename=301730.pdf
http://finance.google.com/finance?q=PTEC
http://www.altaberkeley.com/
http://www.avivvc.com/
http://en.wikipedia.org/wiki/Extensible_Firmware_Interface
http://www.eurofund.co.il/

Wisdom of the crowds principle effectively applied to predict markets, events

While doing our daily research on the web 2.0 deals we came across a very interesting start up that deserves to make our web 2.0 innovations list – Predictify.

Essentially it is a very interesting and pretty innovative idea of using the wisdom of the crowds and the collective intelligence principles to predict in behalf of advertisers and market researchers. It is community-driven prediction market that pays and rewards users for their accuracy, which guarantees user engagement at higher level.

We’ve found out the site has launched just this last October and since then it launched its platform where other companies can create co-branded prediction centers. Freakanomics was Predictify’s launch partner for the platform, where readers can predict outcomes discussed on the Freakonomics blog.

The company has announced today it has closed $4.3 million round of funding, from Sierra Ventures and Sherpalo Ventures. Mark Fernandes, a managing director at Sierra Ventures, will be joining the Predictify board. Predictify has taken so far only an angel round of funding a year ago, but the amount is not publicly disclosed.

More about Predictify

Predictify is a prediction platform where users can predict the future and build a reputation based on their accuracy, and marketers can post questions to collect actionable, forward-looking data “from the crowd”.

Predictors
Predictify provides a simple, fun way to predict the future. You can research, discuss and predict what will happen, build a reputation based on your accuracy, and even get paid real money when you’re right (tell me more). Best of all, it’s free – no points or bets required.

Advertisers
Predictify is an effective way to create interactive advertisements by posting a question related to your product or service. Users’ incentive to be accurate leads to a high level of engagement in your marketing message. The resulting data set, which includes demographic information, provides insight into the preferences of existing and potential customer segments.

Market Researchers
Predictify uses advanced statistical methods to identify experts among their users based on past predictive accuracy, and combines this with demographic information to provide unique, crowd-based insight. You can tap into this user base to collect a large sample of predictions about future events, trends, and market data. Predictify’s unique system captures the full distribution of beliefs, not just the average, and provides easy-to-use graphical tools to analyze the results.

Here is quickly how it works

Predictify is a prediction platform where users can predict the future and build a reputation based on their accuracy, and marketers can post questions to collect actionable, forward-looking data “from the crowd”.

Submit a Prediction

  • Browse or search for questions that interest you
  • Predict the outcome – it’s free, no points or bets required
  • Build a reputation based on the accuracy of your predictions
  • Earn real money – payouts increase as you achieve higher levels of expertise

Click here to predict!

Ask a Question

  • Compose a question about the future that will have an objective, verifiable outcome
  • Submit your question for approval – it’s free (or select Premium to get demographics for $1 per response)
  • View the interactive, graphical results as users submit predictions (example)

Click here to post a question!

More

http://www.predictify.com/
http://blog.predictify.com/
http://mashable.com/2008/03/25/predictify-funding/
http://mashable.com/2008/03/02/predictify-freakanomics/
http://marketplace.publicradio.org/display/web/2008/02/05/predictify/
http://www.infoworld.com/article/07/12/10/50FE-crowdsourcing_1.html
http://freakonomics.blogs.nytimes.com/2007/10/25/a-new-prediction-market-for-the-masses/
http://dilbertblog.typepad.com/the_dilbert_blog/2007/10/hiring-republic.html
http://www.webware.com/8301-1_109-9794602-2.html
http://mashable.com/2007/10/08/predictify-live/

Modu, an innovative approach to cell phones, is on its way to raise $100M

In a week full with $100M funding deals (9You & SpinVox) here is the next one – Modu is an Israel based start up founded just in 2007 and has already raised $20M in its Series A round of funding. In that first round the backers are Gemini Israel Funds and Genesis Partners. Today there are rumors spreading around web that Modu is about to take a second round in the $100M range at $150M pre-money valuation, which means the company is ready to give up to 40% from its equity.

The funding is expected to close the funding round within the next few weeks but no investor names, neither institutional nor individual, are being quoted.

A funding round on this scale is considered extremely large and exceptionally rare in the Israeli venture capital industry. The large-scale of the round can be tied to the proven track record of its founder – Dov Moran. Rumors tell the hoping pre-money for Modu was $200M.

The capital will be used to bring Modu’s product onto the market as early at the end of 2008.

The device Modu has developed is a cellular handset that can be connected to a USB port on any computing device. It is based, among other things, on flash memory technology, and a unique memory technology that interfaces with any device it is connected to, enabling the uploading all forms of data, from telephone numbers to multimedia files.

Modu was established in early 2007 by Dov Moran, founder and CEO of msystems (NSDQ:FLSH), inventors and leaders of the USB flash drive market (DiskOnKey™), FlashDisk (DiskOnChip™) and other ground-breaking products. A seasoned team comprised of executives and managers from msystems, Microsoft, Texas Instruments, Motorola, Qualcomm, Intel, SanDisk, Symbian, Marvell, Orange and other leading companies allows modu to offer a unique blend of experience and unrivaled expertise in the mobile and consumer electronics arenas. modu has already developed key relationships with leading partners and manufacturers and has raised significant initial funding from a distinguished group of financial institutions.

Imagine the freedom to choose a new phone as often as you like, constantly taking different forms, functions and designs.

Imagine a world of connected consumer electronics devices, where you can share information with the world in ways you never thought possible.

modu enables you to create an entirely new communication experience to meet your changing needs, preferences and style.

meet modu

At the heart of the modu ecosystem is modu – a tiny, sleek & sophisticated mobile phone.

Slip modu into a variety of stylishly designed modu jackets to create a new look and provide added functionality that will instantly shape and reshape the way you communicate.

modu also has many mates – modu-enabled consumer electronic devices such as Personal Music Players, Digital Cameras or DECT Phones. Slip modu into modu mates to enhance your ability to quickly and easily communicate and share information with others.

modu jackets – what’s your modu?

You can switch modu jackets as often as you like according to your changing lifestyle and personal expression needs – transforming modu from a stylish phone or business tool to a workout companion or a powerful entertainment system. It’s as easy as slipping modu in and out.

modu allows you to have impact and make a dynamic fashion statement. modu jackets come custom branded with your favorite fashion brands, movies or music artists – all pre-loaded with exclusive content and a unique UI. Simply walk into your favorite store and pick up a new modu jacket to express your passions and interests. With modu, there are no boundaries to the number of unique and affordable phones available for you to enjoy.

All modu jackets are universally interchangeable, allowing you to swap modu jackets with friends. Or buy one as a gift for the favorite people in your life – allowing them to enjoy a brand new communication experience and to think of you every time they pick up the phone.

modu mates

modu mates let the revolution of a connected world to enter your everyday life. modu strives to become the standard communications and personalization enabler to any consumer electronics device. You can slip modu into your digital camera to enable instant sharing of photos with your modu contact list, into a DECT phone to enable land-mobile call consolidation, or into a digital picture frame to view pictures stored on your modu. The connections are boundless. Your ability to share, interact and communicate with the world is now possible with modu.

It’s time for a new stylish world of boundless possibilities, endless choices, and unlimited connectivity. It’s time to be unique. It’s time to modu your life.

The company has recently changed its name from InFone Tech to Modu.

Dov Moran is Founder, CEO and Chairman of modu. Before that, Mr. Moran was the founder, Chairman and CEO of msystems (NSDQ: FLSH). In 18 years, msystems, which invented the USB Flash Drive (DiskOnKey™), FlashDisk (DiskOnChip™) and other innovative flash data storage devices, grew to a $1B company. The company was acquired by SanDisk Corp (NSDQ: SNDK) for $1.6B at the end of 2006.

Mr. Moran is also the Chairman of Tower Semiconductor (NSDQ: TSEM) and Biomas, a bio-tech company. Mr. Moran holds a B.Sc. in Computers and Electronic Engineering (with honors) from the Technion, Israel Institute of Technology.

Other from the team includes:

  • Itay Sherman
    CTO
  • Zack Weisfeld
    VP Marketing
  • Ronit Maor
    VP Corporate Development
  • Liat Arad
    COO
  • Lior Storfer
    VP Research and Development
  • Jacob Shama
    VP Value Added Products
  • Sariel Engel
    VP Business Development
  • Udi Weinstein
    CIO
  • Karl Pfister
    General Manager Europe

More

http://www.modumobile.com/
http://www.globes.co.il/serveen/globes/docview.asp?did=1000325006
http://www.techcrunch.com/2008/03/24/100-million-coming-to-israeli-startup-modu/
http://www.techcrunch.com/2008/01/21/modu-wants-you-to-guess-what-it-is-all-about/
http://www.libraryhouse.net/blog/2007/06/25/roundup-the-pick-of-recent-venture-capital-deals-7/
http://www.libraryhouse.net/profile/tfba6prp87z9os2aappd/
http://www.crunchbase.com/company/modu

SocialMedia totals $4M in funding and is one of the top ad platforms for Facebook

Creating Facebook applications is already big business online. Facebook created a special fund to invest in popular applications for their social platform and there are also several venture capital firms who are keeping an eye on the sector for the next hot or modern Facebook application to invest in. Monetizing the traffic generated from those applications is another story. SocialMedia is one of the top so called ad platforms for Facebook applications.

SocialMedia offers a suite of tools and services for developers building applications that run on social networking platforms including Facebook and MySpace.

SocialMedia Network’s flagship product Appsaholic sells click-throughs to other Facebook applications across a network of affiliated sites in a similar way to FBExchange’s link exchange model, but has more features and seems easier to use and has PayPal integrated. Below is some more information on how Appsaholic works.

Developers become a member of the network by tracking their application on Appsaholic and adding some embed code to their application. The embed code adds an iFrame that serves paid links on their affiliates’ applications. The links go to the highest “AdRanked” advertising developer on their live bidding market. AdRank is determined by multiplying two factors, the offered price per click, and the advertising application’s quality score. The quality score is based on a function of the application’s clickthrough rate and viral growth within the network. The idea is that higher quality applications should be rewarded with cheaper advertising. This dissuades disliked apps from spamming the service.

So, for example, a developer whose application has a quality score of 60 and is willing to bid $.10 per click, has an AdRank of 6. Since ads are served in AdRanked order, the developer could boost his AdRank and position in the queue by bidding a bit higher. Currently PPC rates are 10 to 20 cents. Appsaholic takes 12-30% of that revenue.

The company has recently taken $3.5 million Series A in a round led by Charles River Ventures that also included Marc Andreessen (Netscape) and Jeff Clavier. Charles River Ventures had previously seed funded the company with $500,000. That took the company’s total funding to $4M. 

George Zachary of Charles River Ventures said that the investment “underscores the significant opportunity for SocialMedia Networks to become the new standard for how social networks are monetized.”

Other investors include Jim Bankoff – Former EVP Programming AOL; Ted Barnett – CEO of JamJam; co-founder and CEO of When.com; former COO of Ofoto; Jeff Clavier – Manager Director SoftTech VC; Marc Andreessen – Co-founder of Netscape and Ning.com; Mark Goldstein – CEO of LoyaltyLab.com; Naval Ravikant – Managing Director HitForge; author of VentureHacks; co-founder of Epinions; Tina Sharkey – Former SVP Social Media and Instant Messsaging, AOL, Former Group President Sesame Workshop Internet, co-founder iVillage and Jeremy Wenokur – Former VP Corp Dev, Google. 

There are several other startups claiming to be the top Facebook ad platform: Lookery, fbExchange, RockYou, and Cubics but SocialMedia is one of the early players when they launched their Appsaholic advertising network soon after F8.

Some people are a bit skeptical about companies like SocialMedia arguing that some of the popular social networks themselves can’t even really figure out a profitable way to monetize themselves, let alone third party small companies going to become the standard way to monetize social networks by putting ads and stuff in a widget.

Will they ever manage to make money? Maybe, maybe not. But the potential is huge, and if someone ever succeeds in that field, the Social Media seems in a pretty good position to be among the winners.

More about SocialMedia

SocialMedia Networks is the leading provider of social platform services. It fuses together three core features – management, marketing, and monetization – into a comprehensive package that advertisers and developers can use to grow awareness, and grow their applications on social platforms.

Socialmedia.com was registered in November of 1999. It has since sat idle, waiting patiently for the right time to emerge. Nearly eight years later, that time has come.

Moreso than ever before, people all over the world are being entertained by interacting with others online. What was once simple communication has truly evolved into social media. Until recently, however, the environments in which these increasingly rich interactions took place were controlled by a few, closed entities. This changed on May 24th when facebook welcomed thousands of developers to immerse themselves within their platform.

And so, on this day, socialmedia.com was unleashed.

SocialMedia was one of the first developers on the facebook platform, launching Food Fight and Happy Hour shortly after f8. To date, more than 10 million users have installed one of these applications.

The services we provide to others were born primarily of our own needs in developing and deploying our applications. Through our personal learnings and experiences, we are now determined to offer a similar set of services to all developers and advertisers who care to delve into the world of the facebook platform, and all other platforms that are destined to follow.

Tap into the social revolution with SocialMedia – the app network!

Public information available on SocialMedia claims 1,475,837 apps installed, thus far.

SocialMedia Networks is based in Palo Alto and Mill Valley, CA.

More

http://www.socialmedia.com
http://www.crunchbase.com/company/socialmedia
http://www.techcrunch.com/2007/10/18/socialmedia-networks-takes-35-million-series-a/
http://apps.facebook.com/appsaholic
http://fbexchange.com/
http://www.lookery.com/
http://cubics.com/

SpinVox raises $100M at a whopping $500M valuation

SpinVox, a London based voice-to-text technology is raising $100M round of funding from a bunch of high-profile investors among which are Goldman Sachs, GLG Partners, Blue Mountain Capital Management and Toscafund Asset Management. The service can basically be described as a solution that transcribes voicemails to text so that they can be more easily digitized, searched, and manipulated. SpinVox’s software works simply by converting a voicemail message into text, which it then e-mails to a computer or sends via SMS to a phone. It removes the need to dial one’s voicemail, punch in a password and listen to messages.

This brings the total money invested in the company so far to $200M and today’s round is said to have been done on $500M pre-money valuation. What is also interesting with the company is that the CEO, the 31-year-old Christina Domecq is from the famous liquor family Domecq from UK that was part of the international company Allied Domecq PLC that operated spirits, wine, and quick service restaurant businesses. Allied Domecq was the result of a 1994 merger between Allied Lyons and Pedro Domecq. Rumors go up to the point that SpinVox was planning on an IPO before, but today the company has said it has no immediate plans to go public or sell itself but is exploring all options.

SpinVox is said to have partnerships with 12 mobile carriers, mostly in Europe, including O2, Vodafone, Orange, T-Mobile, 3, and Virgin Mobile, but is barely presented on the US market.

The funds will be devoted to further building the global business of the UK-headquartered company that already operates on four continents.

“Closing this funding round is an exceptional achievement given the current state of the global financial markets,” says Christina Domecq, CEO and Co Founder of SpinVox. “We are delighted to have this group of institutional investors join the company. It clearly underlines the confidence these high-calibre investors have in SpinVox and the management team.”

The new round builds on previous investments made in the company by private equity investors such as Martin Hughes, Charles Dunstone of Carphone Warehouse and Peter Wood, the founder of Direct Line, eSure and Sheila’s Wheels and institutional investors such as ABN Amro, Gartmore and Allen & Co.

“We built SpinVox to answer a real need in the marketplace and have now established a vast new market for voice-to-screen messaging which we continue to lead,” continues Christina. “One of the many reasons why people are getting so excited about SpinVox is that it is one of the few genuinely innovative companies to have emerged in the telecommunications arena in recent years. SpinVox is transforming core messaging for carriers world-wide and delivering new, recurring revenues from existing user behaviour.”

Goldman Sachs International acted as exclusive financial adviser to SpinVox on the transaction.

Most of the technology bloggers simply followed up on the PR materials being sent to them and have positively reviewed the service, but we think there is plenty of room for improvements and the reportedly $500M valuation for the company is hard to understand and justify.

However, the guys from Mashable have more critical look into the technology and have written that while the company is trying to make all the right moves, by opening up MySpace and Facebook applications, the core technology, “continues to fail hard.” We tend to agree with them.

Below are some transcripts from Mashable’s author when he attempted to get the service to accurately translate his voice to text:

What I said: “Ok, well, let’s see… What am I talking about? Oh! Actually I put a new article up on Mashable.com today. ”
What I said, SpinVoxed: “Ok well, see what I’m talking about oh actually put a new article of nashville.com(?) today.”

What I said: “It’s that YouTube or whatever may have helped them get there quicker, citing the new Apple UGC ad that came out as an example.”
What I Said, SpinVoxed: “It’s that a youtube or whatever may have helped them get their quick or setting the new apple UGC ad,…”

What I said: “It’s staying on and letting me talk and so I’m just gonna talk until this thing kicks me off.”
What I said, SpinVoxed: “It’s sticking on let me talk and so I’m just gonna talk into this thing puts me off.”

Mark Hopkins, an author at Mashable, has further said that he has spoken to folks far more familiar with the limitations of VTT (voice-to-text technology) technology that it just isn’t feasible with current standards of computing.

A guy that claims to work for the company has saidthe following. I work for SpinVox and have a window on the process. SpinVox employs a series of speech engines and the majority of our English conversions are automated. The Voice Message Conversion System is actually a “live learning” system that “knows what it doesn’t know”. When it encounters new language or ambient noise that confuses the automated process, it then asks a human to review that portion of the message in dispute. That person then converts the portion of the message in dispute and the complete conversion is then delivered. To date we’ve had about 4 million unique voices pass through the system which improves our ability to understand any voice.

Others, like Rob Abbott, are more favorable explaining that the value of indexable, searchable voice transcriptions is significant. Once integrated into an application like a mail client (Gmail, Mail, Outlook…etc.), the value is clear. The time spent transcribing important voice messages, interviews and conversations is cut by these services. While some services, like SimulScribe and SpinVox do send the audio to markets with cheap labor, the service isn’t always optimal or exact.

I am a current user, he says, of both services and it’s of enough value for me to become dependent on once my habits change. I get previews of my voice messages sent to my iPhone in SMS form, so I know who called and most importantly, why, without having to play the message (in a meeting).

Goldman Sachs is investing in the distributed service and in the technology, so SpinVox is widely integrated into applications which increase productivity, and so the quality of the transcription technology involves to an accurate service, whether it be by human or machine (or both).

Some competitors include Jott, Pinger, SimulScribe, among others.

More about SpinVox

We launched in 2005 through The Carphone Warehouse, The Link and other retail channels. Pretty soon we had over 130,000 regular users, with an unprecedented customer retention rate of 80%. People who started speaking through SpinVox soon found they couldn’t live without it.

SpinVox has since won major industry awards from people like the GSM Association, Red Herring and Ernst & Young. No, we’re not boasting, we’re just pleased. In fact we’re amazed at how SpinVox is changing people’s lives.

At the heart of SpinVox is our patented Voice Message Conversion System™ (or VMCS to keep it simple). It underpins everything we do – our retail, enterprise, service provider and global carrier services. It’s maintained on an enterprise-class hardware infrastructure by an expert management team, to meet the rigorous demands of global carriers and their customers. Which means it just works, brilliantly.

From retail brands and direct customers, to global carriers and Web 2.0 brands, we are leading the way in converging voice and screens. SpinVox products are used on five continents, in five languages, with new carrier and technology partners joining us every month.

SpinVox has 300 employees and offices in nine countries.

The management

  • Christina Domecq
    CEO and Co-founder
  • Daniel Doulton
    Chief Strategy Officer and Co-founder
  • Andrew Cherry
    Chief Financial Officer
  • Tom Clear
    Chief Commercial Officer
  • Philip Marnick
    Chief Technology Officer
  • Rob Wheatley
    Chief Information Officer
  • James Scroggs
    VP Consumer Business

More

http://www.spinvox.com/
http://blog.spinvox.com/
http://www.spinvox.com/spinvox-secures-over-100-million-in-new-funding-round..html
http://www.moconews.net/entry/419-voicemail-to-text-firm-spinvox-raises-100-million-500-million-valuation/
http://www.techcrunch.com/2008/03/20/spinvox-translates-voice-to-text-service-into-a-100-million-round/
http://mashable.com/2008/03/20/spinvox-funded/
http://uk.techcrunch.com/2008/03/19/it-looks-like-spinvox-has-raised-50m/
http://www.reuters.com/article/marketsNews/idUKN1932303420080319?rpc=44
http://www.techcrunch.com/2008/02/13/your-phone-is-your-mic-spinvox-lets-users-talk-to-twitter-facebook-and-jaiku-europe-only/
http://www.spinvox.com/spinvox-targets-cambridge-for-speech-recognition-skills..html
http://en.wikipedia.org/wiki/Allied_Domecq 
http://en.wikipedia.org/wiki/Pedro_Domecq
http://www.crunchbase.com/company/spinvox

Meebo tries to raise $25M in return of only 10% equity valuing the company at the whopping $250M

Meebo is a popular and rapidly growing web based instant messaging start up that was backed up by Sequoia Capital and is said to have roughly 4.6M unique visitors per month according to comScore’s publicly available stats. That’s valuing each of their visitors at the $54 mark, which is significantly more than what AOL has just recently paid for each of Bebo’s 22M visitors – $39 according our simple math. Many industry experts, commentators and bloggers have expressed their negative feelings about the potential deal and more concrete about its pre-money valuation. Anyone remember Slide and their pre-money valuation of $500M? Yet it was said then they had over 150M or so users worldwide, which, if true, valued their users at the $3 range.  

Some analysts have even compared the deal’s value to the Bear Stearns one, which has just sold out for “only” $236M.

There is however something most of the technology blogs seem to have overlooked. Joshua Beil from Level 3 Communications has commented on one of the tech blogs that Meebo’s per user valuation could change quite substantially if one takes into account their unique visitors of the MeeboMe rooms widget. I’ve seen, he says, numbers in the 10-14M range and counting for just this application. Factor this in to the 4.6M uniques to Meebo.com and it’s at a discount to Bebo. We have no idea where he does take his numbers and what his affiliation with the company is, but if we take those numbers for real the $250M valuation does not sound ridicules anymore. In addition to that Venturebeat reports that Meebo has attracted 29 million monthly unique users worldwide, but they also say that some investors remain quite skeptical about Meebo and their business model. We have no clear idea where Venturebeat has come to that number of visitors.

The rumor is that Meebo has hired Montgomery & Co. to represent them in a new fundraising round that may value the company at a $250M. An interesting competition is forming on the scene there between Montgomery & Co. and Allen & Co., which is lately the investment bank behind pretty much all hot start ups that sold (got funded) or about to for hefty amounts (hefty valuations) in the valley such as Digg, Bebo, Slide, Technorati, among others.

What is also being said is that the company is looking to raise $25-30M in venture funding and if the valuation numbers are taken for real it means the VCs will take no more than 10% from Meebo. This is a whole lot more than the $60-70M that it was reportedly worth after a funding round last year.

Some big names in the social-networking space like Facebook and News Corp.’s MySpace.com are rumored to may possibly be interested in the deal. MySpace operates its own instant-messaging service, and Facebook is rumored to have one in the pipeline.

Montgomery and Co. has requested that all offers be in by Wednesday, and has told investors it has several parties interested at a valuation of $200M. The rumor goes here that at least one of the strategic investors isn’t interested in sharing the investment, preferring instead to buy Meebo entirely.

More about Meebo

Meebo launched in September 2005 and received funding from Sequoia Capital in December 2005 and Draper Fisher Jurvetson in January 2007. Today, Meebo’s users exchange over 100 million instant messages daily.In early 2007, Meebo gets another $9 million from Draper Fisher Jurvetson and Sequoia Capital. Skype’s lead investor and YouTube’s lead investor are teaming up. Tim Draper, one of the early investors in Skype, did the deal for DFJ. Meebo’s total funding is now $12.5 million.

More about Montgomery & Co.

Montgomery and Co. was founded in 1986 with a vision of providing strategic capital-formation advisory services to leading aerospace, defense and related technology companies.

Montgomery & Co. took advantage of the technology downturn and consolidation in the banking industry in 2000 to establish its reputation as the “go to” bank for growth companies that wished to evaluate their strategic options and raise capital. In doing so, Montgomery & Co. fulfilled its initial vision of providing a range of advisory services that encompassed M&A, private placements, comprehensive business-development analyses, and other value-added services.

In 2002 the firm was strengthened by investments from the world’s biggest bank, Mitsubishi UFJ, and West River Capital, of Seattle, WA. In 2003 the firm opened offices in Seattle, San Francisco and San Diego. At that time, the firm also significantly expanded its banking expertise within the healthcare and media industries, especially in the M&A practice.

In 2005, the firm was further strengthened by an investment from Tudor Investments which is the venture capital and private equity arm of Tudor Investment Corporation, an internationally recognized diversified investment management firm with $11.7 billion in assets.

More

http://www.meebo.com/
http://blog.meebo.com/about
http://www.monty.com/
http://venturebeat.com/2008/03/17/meebo-raising-round-valued-up-to-250-million-bear-stearns-sold-for-236-million/
http://www.webware.com/8301-1_109-9896718-2.html?part=rss&tag=feed&subj=Webware
http://www.techcrunch.com/2008/03/18/is-meebo-worth-half-a-slide/
http://venturebeat.com/2007/01/18/im-service-meebo-growing-quickly-raises-more-cash/
http://www.techcrunch.com/2005/12/16/meebo-confirms-sequoia-funding/
http://web2innovations.com/money/2007/11/22/meebo-received-funding-from-sequoia-capital/
http://blog.meebo.com/?p=78
http://venturebeat.com/2006/08/02/meebome-lets-you-chat-directly-from-any-homepage/
http://venturebeat.com/2007/01/10/web-20-shakeout-continued-whats-up-at-insider-pages-meebo-others/
http://www.crunchbase.com/company/meebo
http://www.techmeme.com/080318/p7#a080318p7
http://quantcast.com/meebo.com
http://siteanalytics.compete.com/meebo.com?metric=uv
http://web2innovations.com/money/2008/03/14/22m-uniques-mo-site-bebo-goes-to-aol-for-850m-in-all-cash-deal/
http://www.techcrunch.com/2008/01/18/slide-gets-their-huge-valuation-and-raises-50-million/
http://www.crunchbase.com/financial-organization/montgomery-co
http://venturebeat.com/2007/12/06/meebo-partners-with-videoegg-to-help-app-developers-make-more-money/

Jivox, yet another video ad network, has raised $2.7M

The funding was led by Opus Capital and also includes investments from individual investors including Jivox founder Diaz Nesamoney. The funds will be used to continue development of the Jivox online video advertising platform, as well as to expand the company’s sales and marketing efforts. No other names of private investors are publicly disclosed.

Jivox is a web-based video advertising service enabling businesses to better communicate their products and services to a micro-targeted audience in a more customized, relevant way than most traditional mass advertising methods, and internet banners and search engines. Jivox is headquartered in San Mateo, California with offices in Bangalore and Delhi in India.

Jivox in a way looks similar to SpotRunner with their pre-made ads for the TV and cable networks, but is being said to be way cheaper than them.

There’s absolutely no cost associated with creating your ads with Jivox AdSlate. Once you create the ad you like to air, then you set your daily, weekly or monthly ad budget. There are no minimums on the budget you set. Just purchase the amount of highly targeted ad inventory as your budget allows rather than the large block purchases required for most video advertising today. You can change your budget at any time.

Jivox AdSlate will optimize your advertising spend by negotiating the lowest cost possible to air your ads with Jivox Video Network Partner sites and maximize your exposure. Jivox will automatically match your ads with the audience that is most likely to respond favorably to your campaign. The cost of airing your ads is typically between $10-$40 range for each 1000 views (CPM).

“To date, video advertising has only been accessible to the large brand advertisers due to the high costs of production and placement on TV. The explosive growth in online video content is creating an opportunity for mid-sized and local businesses to harness the power of the internet to reach consumers. Jivox is enabling mass adoption of an advertising medium that is much more engaging and effective than search and display advertising due to its visual impact,” said Diaz Nesamoney, founder and CEO of Jivox. “We’re very pleased that Opus Capital and our other investors also see the enormous potential of opening up this market to smaller advertisers.”

“By making online video advertising a possibility for more advertisers, Jivox will accelerate broader adoption of the medium,” said Gill Cogan, general partner, Opus Capital. “As an early investor in Informatica and Celequest, we have had a strong long-term relationship with Diaz, and I’ve seen first-hand how he has been able to turn an idea into a product, and then evolve the product to stay one step ahead of the changing needs of the market. We are looking forward to supporting Diaz and the Jivox team as they build Jivox into a successful business.”

The market

Video advertising is promising to be huge opportunity online and the sector is extremely competitive with new players entering every couple of weeks. Venture capitals also do think the online video advertising holds the chances to be the next big thing on Internet to bring billions of revenues in and are pouring big money into start-ups with the hope they come up to the groundbreaking technology that might shake the sector and make them the huge ROI.   

No matter what standard for video ads the sector might adopt – pre-roll ads, mid-roll adspost-roll ads, watermark ads, viral ads or overlay ads, the undisputed leader remains Google’s YouTube with its huge number of eyeballs. That’s why the smaller players are focusing not on the reach but on different approaches and technologies to more effectively serve, track and measure these video ads. The video ads are in their infancy on Web and there is plenty of room for innovation and growth and all those small start-up companies hold their good chances for success.

Some companies, as we know them, include BlackArrow, BrightRoll, XillianTVPodaddies, VMIX and MeeVee. BrightRoll video ad network itself has raises $5 Million while VMIX, yet another video network company has also raised a whopping amount of money $16.5M to expand its business. Other video advertising players include Revver, VideoEgg’s TheEggNetwork, ScanScout, Adap.tv, AdBrite’s InVideo platform, BroadRamp and Blinkx.

eMarketer predicts online video advertising to nearly double in 2008 to $1.3 billion, but no one’s really nailed a scalable ad platform for video. However, Google’s been quietly testing their own system and there are a bunch of other startups tackling it as well.

More about Jivox

Jivox is an exciting new online video advertising service that gives businesses that want to advertise on the Internet a better, personalized way to communicate their products and services to a micro-targeted audience. If your Internet advertising is not as effective as it used to be, or you are looking for a new way to get your message to your customers via rich visuals and video, Jivox can help.

Jivox helps you create, target and deliver professional video advertising on the Internet – going way beyond the search engine or banner ads – without spending a lot of time and money on producing your ad. Our proprietary technology helps you pinpoint your ads to the exact geographic, behavioral or demographic audiences you need to reach on the web. Here’s how: 

1. Create your own video ad
The Jivox AdSlate self-service video ad maker enables you to use our vast library of stock images, video clips and music to create your own ad or you can take your existing materials (such as a digital picture of your storefront, product shots, head shots, logos, etc.) and insert important information like your contact information, website, special discounts and promotions. See sample ads created with Jivox AdSlate Minutes later, you can be delivering your new ad on our extensive video network. See how it works.

Or, if you have an existing commercial you are using on Cable T.V., you can easily upload and use that to advertise on the Jivox Video Network. Or, let us build your ad for you.

2. Identify your target audience
Jivox delivers tailored, branded advertising to viewers based on their interests, enabling you to maximize your direct response opportunities. The Jivox Video Network delivers your video advertisement to your audience using geographic, demographic, behavioral and contextual intelligence.

Jivox has developed sophisticated algorithms that determine the best web sites and video content in which to serve your ad.

3. Define your budget and timing for your advertising campaign
Even if you have a limited budget, you can start your video ad campaign now with the Jivox Video Network. You can identify specific times of day, days of the week and other important choices or even run Time-of-Day/Day-of-Week ads on an introductory budget. Unlike most other forms of TV and web advertising, with Jivox, you only pay for ads that were actually viewed on a web site. More on Pricing.

The exclusive Jivox Ad Campaign Reports gives you advanced intelligence to optimize your advertising. You can then review the results to make intelligent decisions about how to improve or expand your media choices.

Jivox was founded in 2007 by Diaz Nesamoney, the visionary entrepreneur behind
Informatica (Nasdaq: INFA) and Celequest (acquired in 2007 by Cognos). Jivox aims to
bring the power of online video advertising to the mass market.

Management team

Diaz Nesamoney, Founder & CEO
Diaz Nesamoney founder of Jivox has had two prior successful ventures.  Before founding Jivox, he founded Celequest, raised over $20M in venture capital, and served as its CEO until early 2007, when the company was acquired by Cognos Corporation.  Celequest introduced the market’s first BI appliance, a disruptive innovation that led to its acquisition by Cognos. He was previously co-founder, President and Chief Operating Officer at Informatica (NASDAQ:INFA), which he took from a startup to a publicly traded company in 1999 with a market capitalization of over a billion dollars.  Informatica pioneered data integration software as a category and is now the market leader with over $400M in revenue. Diaz is a trustee of the American India Foundation, a leading international development organization charged with the mission of accelerating social and economic change in India. Diaz holds a Masters degree in Computer Science from the Birla Institute of Technology and Science in India.

Naren Nachiappan, Managing Director, Jivox India
Naren Nachiappan comes to Jivox from Wind River (NASDAQ:WIND), where as Vice President and General Manager, he was a part of the executive team responsible for reigniting growth and adding over $100 million to the top line in three years. Naren was directly responsible for taking the Device Management business from a concept to a multimillion-dollar revenue rate in under 9 quarters. At Wind River, Naren established the company’s first product development team in Bangalore, India, with a zero percent attrition rate through his three-year tenure. Earlier in his career, as CEO of Proceler and as Senior VP at VenturCom (acquired by Citrix), he was responsible for pioneering several industry innovations such as “the first support for automated application acceleration using hybrid SoCs” which resulted in Proceler’s nomination for the 2001 MPR Analysts choice award, and the first flight-essential certified UNIX for avionics applications on the Boeing 777. Naren graduated cum laude from Harvard University and holds an MBA from the UC Berkeley Haas School of Business.

Parth Chandra, Chief Architect
Parth has over 14 years of experience in the software industry in the field of Data Integration and Business Intelligence. Parth has worked most recently at Insights On-Demand, where he was the Chief Architect. Before Insights, he worked at Informatica (NASDAQ:INFA) as a Sr. Software Architect where he was part of the founding team that was responsible for software design and development of their market leading Data Integration products. Prior to Informatica he held software engineering positions at Citicorp Software and Neuron Data where he designed and implemented large scale financial transaction systems and cross platform development environments. Parth holds a degree in Mechanical Engineering from IIT Kanpur and an MBA degree from the Indian Institute of Management (IIM) Bangalore.

More about Opus Capital

Opus Capital Group is an alternative assets firm with more than $1 billion in committed capital under management. Since 1971, Opus Capital’s predecessor funds have invested in more than 350 companies spanning multiple industries.

More
 
http://www.jivox.com/
http://www.jivox.com/Jivox_funding_release_final.pdf
http://www.opuscapital.com/
http://mashable.com/2008/03/10/jivox/
http://www.thealarmclock.com/mt/archives/2007/05/jivox_stealth_m.html
http://www.paidcontent.org/entry/419-self-service-video-ad-provider-jivox-closes-27-million-seed-round/
http://venturebeat.com/2008/03/09/jivox-offers-simple-online-video-ads-for-small-businesses-raises-round/
http://www.redherring.com/Home/23889
http://web2innovations.com/money/2008/03/09/video-advertising-networks-are-hot-brightroll-gets-its-second-round-claims-it-already-served-over-1-billion-video-ads/

Yelp: $200M valuation, $31M total funding, 8M uniuqes, SEO – all for local reviews

The 4 years old Yelp, which is a local review site, has already reached a hefty popularity on Web. Today we have read online the site claims to have more than 8M unique visitors per month, which can already be called a hugely popular site and all that achieved within 4 years only. Pretty impressive one may say. But the company seems to have raised tons of money in 4 rounds totaling $31M to date. The pre-money valuation was rumored to be in the $200M range, which for a site with almost 10M uniques per month is becoming an industry standard already. The revenues, also rumored, are said to be in the $10M range per year, which was widely criticized on different tech blogs as not enough taking into consideration the site’s already massive reach. Well, we are not quite agreeing with those critics. Take for example Digg and Technorati, both sites are hugely popular and their revenues are not quite impressive either and are perhaps in the Yelp’s annual range. Not even to mention WordPress.org‘s case and their strong NO to a $200M buyout deal last year on little to no revenues, as far as we know. We would guess that just like Digg and Technorati, Yelp will also try to shop itself around and their investors are in fact looking for an acquisition deal with hefty exit price tag rather then building a self-sufficient company taking into consideration the very favorable time for web 2.0 companies in the Valley. Yet, we think $10M per year off 8M unique visitors per month is pretty well done job in monetizing their traffic, for now. 

Their forth round of funding is said to be in the $15M range and led by DAG Ventures. Yelp says that they will be using the money to expand geographically, add onto their sales team, and establish an office in NYC. With this latest round, DAG joins previous investors Max Levchin who put $1 million back in the summer of 2004, Bessemer Venture Partners with their $5 million round closed in 2005, and Benchmark Capital ($10 million, Q4 2006). The company’s total funding is now $31M. If the rumored pre-money valuation is correct then DAG Ventures seems to have bought only 7.5% for its money.

The company is based in San Francisco and was founded back in 2004 from former PayPal early employees.

Yelp claims they are relying on “word of mouth marketing” but from what we have seen their site is heavily search engine optimized with several million of indexed pages at Google, which is well done and good after all, but you should refrain from claiming you are all about word of mouth marketing. We have no access to their Google Analytics files where the traffic sources are visible, but we are pretty sure a vast majority of their 8M uniques per month is coming from Google and some of the other top search engines. 

Other critics of the company’s strategy say that a viable approach to building a company like Yelp would be to prove that your business model works in the cities that you initially target and then replicate that model elsewhere once you have your validation. If you cannot establish a profitable business model in the cities you initially target, expanding your sales force, adding additional offices and replicating your unsuccessful model elsewhere are not viable solutions for developing your company.

The local space is very crowded area as it seems. Yelp’s competition includes companies like InsiderPages (acquired by Citysearch), Viewpoints, YellowBot, Google Local, Yahoo Local, JudysBook.com, Rummble, LocoGopher.com, Zvents, Upcoming, Qype, Tipped, GenieTown, YellowPages.com, among others.

More about Yelp

Yelp is the fun and easy way to find, review and talk about what’s great (and not so great) in your world. You already know that asking friends is the best way to find restaurants, dentists, hairstylists, and anything local. Yelp makes it fast and easy by collecting and organizing your friends’ recommendations in one convenient place.

Yelp is the ultimate city guide that taps into the community’s voice and reveals honest and current insights on local businesses and services on everything from martinis to mechanics. Yelp is just real people, writing real reviews, and that’s the real deal. Yelp is a fun and engaging place for passionate and opinionated influencers to share the experiences they’ve had with local businesses and services. Yelp is the definitive local guide in the San Francisco Bay Area and a force to be reckoned with in Chicago, New York, Boston, Los Angeles and Seattle. But really, we’re everywhere. From Austin to Madison and everywhere in between, reviews are coming in from all over the country!

Yelp is word of mouth marketing – amplified. Savvy local marketers now have a great channel to effectively target local consumers. Since July 2004, co-founders Jeremy Stoppelman (CEO) and Russel Simmons (CTO) and their Yelp crew have been striving to make life better for people who love to patronize great local businesses. Discovering accurate information on local establishments has never been this entertaining. Writing reviews has never been this fun, easy and addictive!

The Yelp Management Team

Jeremy Stoppelman
Co-founder and Chief Executive Officer
Jeremy co-founded Yelp Inc. in July 2004 with former colleague and friend Russel Simmons.
Prior to Yelp, Jeremy was the VP of engineering at PayPal. He left PayPal in the summer of 2003 to attend the Harvard Business School. Upon completing his first year at HBS, Jeremy joined an incubator started by Max Levchin (co-founder of PayPal) for a summer internship. It was there that he was reunited with his old colleague Russel Simmons and the two teamed up to create a vibrant community around local information. Jeremy holds a B.S. in computer engineering from the University of Illinois.

Russel Simmons
Co-founder and Chief Technology Officer
Russ co-founded Yelp Inc. in July 2004 with former colleague and friend Jeremy Stoppelman.
Prior to Yelp, Russ was one of the early employees and the lead software architect at PayPal. He led a team of top engineers on critical projects related to security, scalability, stability, and internationalization as the company scaled rapidly. Following his time at PayPal, Russ joined Max Levchin’s (co-founder of PayPal) incubator, where he teamed up with Jeremy. Russ holds a B.S. in computer science from the University of Illinois.

Geoff Donaker
Chief Operating Officer
Geoff joined the team in November 2005.
Prior to Yelp, Geoff spent five years building Web communities at eBay, most recently as director of international category management and previously as director of collectibles. His previous experience includes business development and marketing management roles at Excite@Home, Voter.com, Classifieds2000 and Mercer Management Consulting. Geoff has a B.S. in mechanical engineering from Stanford University.
More

http://yelp.com/
http://blog.yelp.com/
http://jeremy.yelp.com/
http://www.google.com/search?q=site%3Ayelp.com
http://www.techcrunch.com/2008/02/26/yelp-raises-15-million-fourth-round-valuation-200-million/
http://www.drama20show.com/2008/02/27/yelp-raises-more-money-for-business-stuff-and-parties/
http://valleywag.com/tech/jeremy-stoppelman/the-hard-life-of-a-web-founder-244590.php
http://valleywag.com/tech/party-report/party-correspondent-confronts-ghosts-of-yelp-parties-past-331048.php
http://www.timeout.com/chicago/articles/features/25797/amateur-hour
http://www.npr.org/templates/story/story.php?storyId=18349445
http://money.cnn.com/2008/01/23/smbusiness/manage_online_reputation.fsb/index.htm?postversion=2008012409
http://www.washingtonpost.com/wp-dyn/content/article/2007/08/14/AR2007081401782.html
http://publications.mediapost.com/index.cfm?fuseaction=Articles.showArticleHomePage&art_aid=64844
http://startup.wsj.com/ecommerce/ecommerce/20070719-richmond.html
http://www.informationweek.com/news/showArticle.jhtml?articleID=199100332
http://online.wsj.com/article/SB117272184209823054-search.html?KEYWORDS=yelp&COLLECTION=wsjie/6month
http://venturebeat.com/2006/10/04/local-review-site-yelp-raises-10-million-from-benchmark/
http://www.techcrunch.com/2007/09/25/garageseek-rates-mechanics-but-yelp-will-kill-this-category-too/
http://gesterling.wordpress.com/2008/02/27/yelp-raises-15-million-in-round-four/
http://bub.blicio.us/?p=732
http://www.crunchbase.com/company/yelp
http://joeduck.com/2008/02/27/yelps-new-funding-round/
http://www.alleyinsider.com/2008/2/yelp_raising_more_money_opening_ny_office
http://en.wikipedia.org/wiki/Yelp%2C_Inc.