VENTURE CAPITAL MARKET REVIEW, ISSUE 34 (APRIL 20-26)

Really active week on venture capital market. Few mergers and acquisitions are made by the giants, startups still can count on enormous investment from venture firms and angels, Xiaomi continue conquering the world, next stop – India.

M&A. BlackBerry Is Buying File Security And DRM Startup WatchDox for up to $150M

Canadian handset maker BlackBerry has been on a mission to turn around its beleaguered handset business by focusing more on software, and it looks like it has taken a significant step in that direction, specifically around file security and DRM. According to reports coming out of Israel, now confirmed by BlackBerry itself, it is buying WatchDox, a startup that has developed cross-platform technology for digital rights management and for enterprises to share files securely. BlackBerry, the reports say, is paying between $100 million and $150 million for the company, and will also leverage its 100-person team in Israel to build out its R&D operations in the country.

BlackBerry says it is not disclosing the terms of the deal. The plan is to integrate WatchDox’s technology as a value-added service with BlackBerry’s Enterprise Mobility Management (EMM) portfolio. It will be available with BES12, which works on multiple platforms.

M&A. Canon Acquires London-Based Family-Photo Sharing Startup Lifecake

London-based startup Lifecake, which offers a photo-sharing app aimed at parents with young children, has been acquired by Canon Europe, as the hardware maker aims to bolster the services side of its business. Terms of the deal remain undisclosed, but my understanding is that this is an all in acquisition, consisting of the Lifecake app and user base, existing 6 person team, and technology.

Canon says the acquisition marks a “major step” in the development of the company’s digital consumer services business and its ambition to “play a part in every image taken no matter what device is being used” — in other words, not just photos taken with Canon hardware e.g. on competing smartphone cameras.

It’s also talking up the purchase of Lifecake as a way of putting down roots in London’s ‘Tech City’ (also known as ‘Silicon Roundabout’) where the startup is currently based.

Founded by former Skype, Qualcomm, and Yahoo engineers, Lifecake offers a photo-sharing app for families, which allows parents to store, organise, share and “relive” key moments of their children’s lives.

Features include the ability to create photo and video timelines, granular privacy settings that let you specify who can see what, and the option to create printable photo books.

M&A. 58.com, China’s Largest Classifieds Site, Acquires Rival Ganji.com

58.com, China’s largest classified site by monthly unique visitors, has bought rival Ganji.com. Beijing-based 58.com forked over $412.2 million in cash as well 34 million newly issued shares for a 43.2 percent stake in Ganji.com.

58.com, which went public on the New York Stock Exchange in 2013, also disclosed that it has received $400 million from returning investor Tencent.

After the deal is finalized, 58.com and Ganji.com will continue to operate separately.

All the last local big deals underscore the importance of the three largest consumer Internet companies in China: Baidu, Alibaba, and Tencent. The three giants, which are jointly referred to as “BAT” own significant stakes or are investors in many smaller companies.

M&A. Infosys To Acquire E-Commerce Services Provider Kallidus For $120M

Infosys, the India-headquartered consulting and IT firm, is on the verge of making its second significant acquisition of the year after it announced a deal to buy digital e-commerce services provider Kallidus for $120 million. It also made a $2 million investment in an air monitoring startup.

With the Kallidus deal Infosys, which revealed the acquisition of enterprise resource planning (ERP) software company Panaya for $200 million in February, is buying the holding group behind Skava. The San Francisco-based company provides a cloud-based platform that powers a range of online services for retailers, for example mobile wallets, apps, web stores, and more.

The Indian software giant had another slice of M&A news: it is putting $2 million into Airviz, an air quality monitoring startup that was born out of Carnegie Mellon.

Airviz’s ‘Spec’ monitoring sensor tracks the quality of air in indoor and closed environments. The device detects invisible particles floating in the air and, while it doesn’t actively filter like an air purifier, it helps owners make changes to improve the quality of air, and track changes over time.

M&A. Atlassian Acquires Open Source Video Conferencing Company BlueJimp

Atlassian, the company behind developer and collaboration tools like JIRA, Confluence and HipChat, announced that it has acquired the video conferencing service BlueJimp.

BlueJimp, which is headquartered in Strasbourg, France, is the company behind Jitsi, a popular open-source chat and video conferencing tool. BlueJimp’s technology will replace the current video chat technology that powers Atlassian’s HipChat video features, both in Atlassian’s hosted and on-premise versions.

As Atlassian’s top-managers told, one of the first new features current HipChat users will see thanks to this acquisition is support for video conferences with multiple participants. Currently, HipChat only offers one-to-one video.

Atlassian promises to continue to support and develop the open source version of Jitsi going forward.

M&A. Freelancer.com Acquires Payment Service Provider Escrow.com For $7.5M

Job marketplace Freelancer.com announced that it has agreed to purchased Escrow.com for $7.5 million in cash. The acquisition was funded by through a placement of $10 million AUD (about $7.8 million) in ordinary shares of Freelancer.com to institutional investors.

As its name suggests, Escrow.com provides online escrow services for e-commerce sites by holding payments for goods or services until a transaction is successfully completed. Its commercial partners include eBay, GoDaddy, AutoTrader.com, and Flippa.com. Escrow.com was founded in 1999 by Fidelity National Financial, then merged with iLumin in 2002 before being purchased by an unnamed private investor in 2004. Freelancer.com said it will acquire Escrow.com from the same investor.

In a prepared statement, Freelancer.com chief executive Matt Barrie said that the acquisition will allow Freelancer.com’s 15 million users to make more secure payments. He also added that “it’s a strong cornerstone for entering the payments space.”

STARTUP. Consumer Finance Startup CompareAsia Scores $40M Series A

CompareAsiaGroup, which runs websites that help users find financial services, has raised a $40 million series A led by the Goldman Sachs Investment Partners team.

Other investors include Nova Founders Capital (a venture firm that is also one of CompareAsiaGroup’s founders), Jardine Pacific, Ace & Company, Route 66 Ventures, Zynga-founder Mark Pincus, and Owen Van Natta, who has held senior positions at Facebook and MySpace. CompareAsiaGroup’s total raised to date is now about $45 million, including an earlier seed round.

CompareAsiaGroup currently operates sites in eight Asian countries (Hong Kong, Indonesia, Malaysia, the Philippines, Singapore, Taiwan, Thailand, and Vietnam) that let consumers compare credit cards, loans, insurance, and other financial products for free.

It makes money by partnering with some companies (it currently works with 60 brands, including HSBC, Citibank, and Standard Chartered) and charging them if a user signs up for their services through its sites. Co-founder and managing director Gerald Eder, however, says CompareAsiaGroup seeks to provide visitors with a comprehensive overview by displaying all the institutions that fit their requirements instead of placing its partners more favorably.

Its Series A will allow the company to add more categories, improve its platform’s technology, and expand in its current markets, before launching in new countries.

STARTUP. German Online Loans Platform Smava Raises $16M

Germany’s Smava — a peer-to-peer lending platform where investors provide the funds to loan money to borrowers — has raised $16 million in funding led by Phenomen Ventures, along with existing investors Earlybird and Neuhaus Partners. Phenomen’s track record in fintech investments includes backing Prosper, the U.S.-based peer-to-peer lending marketplace.

The investment takes the total raised by Smava to nearly $30 million.

Smava, like other online lending platforms, has developed a set of algorithms to vet and approve potential loan candidates. The fact that it is fully automated help it pass on low interest rates to users. To date, Smava has loaned out $600 million through its platform, with the number of loan originations growing by 100% in the last year.

The funding will be used to advance smava’s scoring technology, hire the best talent and further fuel growth. It will also help the company compete against rivals. They include Auxmoney, which is backed by Index, Union Square Ventures, Foundation Capital, among others and also raised $16 million in 2014. Others in the space include Zopa in the UK (which has raised over $50m) and Lending Club in the U.S., which went public last year.

STARTUP. Simplilearn Raises $15M For Professional Training And Certification

Simplilearn, a company helping customers get certified in areas like PMP and Android development, has raised $15 million in Series C funding.

The company offers courses both online and in classroom workshops and says there are more than 200 courses and 40 accreditations. Since launching in 2010, more than 400,000 people have been certified through Simplilearn courses.

CEO Krisha Kumar said the most popular courses include big data and analytics, digital marketing, project management and various web programming languages.

Simplilearn stands out from competitors because of its focuses on “short-term certification courses that have direct impact on career growth,” Kumar said.

Goals for 2015 include training 1 million new users and doubling the course catalogue, he added.

Simplilearn has now raised a total of $27 million. The new round was led by Mayfield Fund, with participation from past investors Kalaari Capital and Helion Venture Partners.

STARTUP. Zhiguoguo, Which Lets Chinese Companies Register Trademarks For Free, Raises $3.7M Series A

Protecting intellectual property in China is notoriously difficult, even though the country is trying to set up legal safeguards to aid emerging industries. Zhiguoguo wants to help businesses preserve their IP by providing free trademark registration and affordable legal services.

Based in Beijing, the startup announced that it has raised a $3.7 million series A led by Matrix Partners China, with participation from returning investor Legend Star. Founder Sisi Liu says that Zhiguoguo has processed 20,000 orders since May 2014. Its new capital will be used for marketing, hiring, and increasing Zhiguoguo’s roster of paid legal and consulting services.

According to Wabei, more than 2 million trademarks were registered in China last year and that number is expected to increase at least 30 percent every year. The process can be difficult and tedious, however, with registration requirements differing from region to region. Zhiguoguo helps businesses by giving them the same online forms regardless of where their business is based. It charges for additional services like trademark changes or transfers and copyright applications, with prices starting from 500 yuan (about $80).

Zhiguoguo’s last funding was an undisclosed angel round raised in June 2014.

STARTUP. Mixmax Raises $1.5M To Bring Interactive Apps To E-mail

Mixmax, which is making e-mail interactive with apps that set-up calendar meetings and polls, raised $1.5 million from Harrison Metal, Floodgate’s Mike Maples and Ann Miura-Ko, Ram Shriram of Sherpalo Ventures and angels Eric Ries, Soundcloud CEO Alex Ljung, Nuzzel CEO Jonathan Abrams, Inkling CEO Matt MacInnis and Soundcloud’s Eric Wahlforss.

“It’s crazy that we have these incredibly powerful devices and we’re still communicating the same way we did 25 years ago,” said co-founder Olof Mathé, who added that his experience in Gmail doesn’t really differ that much from the Pine e-mail client he used two decades ago.

Mathé said the web has since evolved, with lots of expressive communication forms through video-conferencing and collaborative editing.

“E-mail remains static, plain, and un-actionable,” the company said in a statement announcing its funding round today.

Mixmax is a simple Chrome plug-in that adds extra functionality to your G-mail accounts. You can put in little apps or widgets to schedule meetings, annotate documents, make purchases, confirm orders or complete surveys — all within the e-mail.

INVESTMENT. Xiaomi Boosts Its Business In India With Tata Sons Head

Xiaomi is making a push to be a local player in India. Days after unveiling its first phone customized to the South Asia country, Xiaomi announced that it has taken investment from leading Indian businessman Ratan Tata.

Tata (pictured above with Xiaomi VP of global Hugo Barra and head of India Manu Jain) is chairman Emeritus of Tata Sons — a conglomerate with shares in over 100 businesses, including Tata Motors and Indian Hotels. 77-year-old Tata has taken an active interest in India’s technology startups of late, and his portfolio also includes an investment in Paytm, the payments firm that took money from Alibaba at a billion dollar valuation.

Xiaomi did not reveal the size or value of Tata’s stake, nor did it confirm a valuation, but it did say that he would act as an “advisor” as well as an investor.