VENTURE CAPITAL MARKET REVIEW ISSUE IV (August, 2-8, 2014)
August started without any special sensations on venture capital and startup markets.
M&A. Rhapsody buys SoundTracking and Exfm
Rhapsody, music streaming service with 2 million paying subscribers, finished an acquisition of Schematic Labs, makers of “Instagram for songs” app SoundTracking, and Exfm, a social music discovery service that had been shut down since May.
SoundTracking‘s app for sharing what song you’re currently listening to with a feed of friends won’t be shut down. Instead Schematic plans to equip it with “new features to take advantage of Rhapsody’s 30-million track global streaming catalog.”
SoundTracking and Exfm could help make Rhapsody more relevant in the current battle for ears. Over the past years it’s been eclipsed by services like Spotify, and boxed out by platform owners like Apple and Google.
M&A. Twitter acquires Mitro security startup
Twitter is acquiring a small password security startup called Mitro. New-York-based startup builts a way that multiple people can share or control passwords to a single account.
Twitter isn’t keeping the product and we hear that the team will likely be working on geo-location products.
However, Twitter is allowing the product to live on. Mitro is becoming an open source project and the startup is working with the Electronic Frontier Foundation to vet the code and guide Mitro toward being a self-sustaining, nonprofit, community-run service. For now, it will stay available until at least the end of the year. The company has released all of Mitro’s server and client code under the GPL license on GitHub.
M&A. Directr joined Google team
Google Inc.’s YouTube unit said it acquired Directr, a mobile-video startup, to reach more small-business customers and boost its video-advertising efforts. No purchase price was disclosed.
Directr has a mobile app for Apple Inc.’s iOS platform that makes it easy for small businesses to shoot, edit and upload short videos to the Internet. The Directr team will join YouTube’s video ads team, Google said.
Directr now charges for its app, but it will be free once the startup joins YouTube, Google also said.
M&A. Square mergers Caviar
Payment network Square merged luxury-goods delivery service Cariar. No purchase price was disclosed but experts think about $100 million.
With no shortage of competition, Caviar now gains access to a large payments network to help the company acquire new restaurant partners and move beyond the seven cities in which it currently operates.
INVESTMENT. European Bauer Media Group launches $134 million venture fund
It’s only a few weeks since Google Ventures announced it’s setting up shop in London as a hub for investing $100 million all over Europe. Now another big fund has been unboxed by local German media firm, Bauer Media.
The new fund — €100 million or circa $134 million — will be invested in European digital businesses over the next ten years via a new VC arm, called Bauer Venture Partners (BVP). BVP is not limiting itself to particular sizes or stages of investments.
Bauer Media has already been dipping its toe into startup investing, including co-leading a $6.7 million Series A round in Swedish health and fitness app Lifesum earlier this year.
Zooming out, longer-in-the-tooth European VC giants include Index, which recently raised a new early-stage $550 million fund for investments in Europe and Israel; Accel which closed a $475 million fund in March 2013 also mainly for Europe; and Balderton, which closed a $305 million Series A fund this April, exclusively earmarked for Europe.
INVESTMENT. VKontakte co-founder launches venture fund in Israel
One of VKontakte co-founders Vyacheslav Mirilashvili founded Private Equity Yesodot venture fund in Israel. Unlike his former project, Vaizra,fund aims to develop energy storage and infrastructure projects.
Nir Grinberg became fund’s co-founder. His part of work is a search of perspective projects to invest in, while Mirilashvili will be gathering funds. As for today fund is managing Vyaceslav’s own funds.
Miralishvili earlier already participated in Israel-based startups. One of the most successful investments were attracted for PrimeSense company, later bought by Apple.
INVESTMENT. Practica Capital invests in Tokia.lt
Practica Capital tells that they invested into Tokia.lt, a Lithuanian online marketplace that allows users to find make-up artists, nail art, hairdressing, and other beauty specialists by digging into their “looks”, video lessons, and reviews to book appointments. It sounds like what Stockholm’s Vint is doing for personal training, Tokia is trying to do for beauty services. Vint raised $1.8 million in seed funding, but who knows where Toika is on that spectrum.
The amount of funding into Tokia wasn’t disclosed, which bugs me because it defeats the purpose of a funding round announcement. Why would you tell the world you got a round of funding if you won’t share the only fact that gives your statement any weight? All it does is lead me to assume a company diluted their equity for an embarrassing amount of money, which isn’t newsworthy.
Tokia has so far seen 13,000 users in their native Lithuania, where members can select from 300 registered professionals. With the funding Tokia is looking to expand on those numbers by spreading out geographically. Southern European locations, like France, Italy, and Spain are next up on the company’s targets due to these countries’ interest in decorative cosmetics and the high amount of social activity online by women.
STARTUP. Wevorse attracts $1.7 million
Divorcing startup Wevorce announced that in took $1.7 million. Projects aim is to help still married people to solve problems with divorce. Seed round was held by Foundation Capital and Sam Altman.
To date, more than 100 divorces have been handled by Wevorce, and 99 percent of those have stayed out of court. According to Crosby, the typical divorce in the United States costs $27,000 — and the average Wevorce costs a third of that.
Wevorce currently has 28 full-time staffers across 10 offices in the Western US, and the new funding will largely be used to help scale that out across the country. Crosby says that Wevorce has received interest from people worldwide, so the hope is to eventually grow the service internationally as well.
STARTUP. TimePad attracted funds from Target Ventures
TimePad app attracted second round of investment from Target Ventures. Fund. Thus, startup already got $1 million in common. Fund became a main stakeholder of TimePad in January, 2014, after receiving 19% of sticks from “Afisha-Rmabler-SUP”.
Received funds TimePad plans to spend for increasing functionality.