Tech Confidential

The Deal's tech coverage moves to Dealscape

Fri, 06 Feb 2009 11:50:00 -0500

The Deal's technology coverage is on the move this weekend. Come Monday, please join us at our recently relaunched Dealscape blog platform.

Set your bookmarks to Technology: Deals and Dealmakers, the topic center where you'll find stories about technology deals, including venture capital fundings, mergers and acquisitions, and profiles of the people behind the deals. That's also where you'll find our award-winning Behind the Money video show, which features conversations with tech dealmakers; our current episode, "Hacking Education," is a roundtable discussion with Fred Wilson, Brad Burnham and Albert Wenger, partners at the New York City VC firm, Union Square Ventures.

Stay tuned for more changes as we redesign TheDeal.com this spring. - Mary Kathleen Flynn and Olaf de Senerpont Domis.

WiMax chipmaker Wavesat raises $9.5M

Tue, 03 Feb 2009 10:36:35 -0500

Broadband wireless chipmaker Wavesat Inc. has raised $9.5 million in funding from BDR Capital, BDC Capital and Multiple Capital.

The company's semiconductor products enable carriers and mobile device makers to provide WiMax and other wireless broadband technologies. Wavesat's 4G chip architecture was introduced in May 2008.

The company, founded in 1993, raised a round of undisclosed size in 2006 from SK Telecom Co. Ltd. - Olaf de Senerpont Domis

See Feb. 3 press release from Wavesat

Pano Logic connects with extra $6M

Tue, 03 Feb 2009 06:00:00 -0500

Pano Logic Inc., a maker of desktop virtualization technology, has extended a $12 million Series B round announced a year ago to include an additional $6 million, the company said Tuesday.

The extension was led by Foundation Capital and Goldman, Sachs & Co. Goldman led the first tranche of the round, with Foundation and ComVentures participating. Goldman managing director Pete Perrone joined the board as part of the original Series B.

Founded in 2006, Pano Logic offers software and hardware, including a desktop client that uses very little power compared to a traditional desktop PC and connects a keyboard, mouse and other peripherals to a virtual server. - Olaf de Senerpont Domis

See January 2008 press release from Pano Logic

Atlas Venture raises $283M tech and life sciences fund

Thu, 29 Jan 2009 12:51:10 -0500

Early-stage firm Atlas Venture has raised a new $283 million fund targeting technology and life sciences startups in the United States and Europe.

The firm's eighth fund include existing limited partners Kisco Management, The Kresge Foundation and Paul Capital as well as new LPs Franklin Park, Industriens Pensionsforsikring A/S and Meketa Investment Group, Atlas said.

Atlas also announced the new fund's first investment, stealth cloud computing startup CloudSwitch. Atlas co-led the $7.4 million round. -- Olaf de Senerpont Domis.

See Jan. 29 press release from Atlas Venture

AdMob raises $12.5M from DFJ, Northgate

Thu, 29 Jan 2009 11:57:07 -0500

Money keeps pouring into advertising network startups, especially in the mobile world. The latest to score a significant round is AdMob Inc., which today announced a $12.5 million round from Draper Fisher Jurvetson's Growth Fund and Northgate Capital.

The funding is an extension of the company's Series C, bringing the total raised in the round to $28.2 million and AdMob's aggregate funding to $47.2 million. The company's previous backers include Sequoia Capital and Accel Partners.

AdMob CEO Omar Hamoui told us a while back that he had been running a mobile social network called Photo Chatter prior to founding AdMob. He was having trouble getting users to sign up for the service so he offered to pay a mobile publisher one cent per click to advertise on the site. When it worked better than the existing ad solutions, he realized others would want to take advantage of that, so he brokered an ad deal for that same publisher and AdMob was born.

Since then, the company has seen significant success and developed some compelling offerings, including some interesting ad tracking features for the iPhone. AdMob said the latest funding will be used to expand worldwide operations, boost investments in its mobile technology platform, grow its offerings to publishers and advertisers and increase the size of its sales and business development teams.

The AdMob deal follows other mobile ad deals, inlcuding a $10.5 million round for Apptera Inc. and an $8.25 million round for Transpera Inc., both announced in November. -- Olaf de Senerpont Domis

See Jan. 29 blog post from AdMob
See July 2007 post on AdMob from Tech Confidential

Rivermine rings up $5M

Tue, 27 Jan 2009 08:00:00 -0500

Rivermine, whose software helps companies manage their telecom expenses, Tuesday announced a $5 million round of financing led by SoftBank Capital. Also participating were previous investors Valhalla Partners, Longworth Venture Partners and Columbia Capital.

The company announced an $8.7 million third round in November 2007, also led by SoftBank.

The company claims its software automates telecom contract sourcing, ordering, inventory management, invoice processing and auditing, wireless device management and reporting.

Founded in October 2001 as Telco Exchange LLC, Rivermine's software caught on fast, as the startup had signed up several large customers in the retail, hospitality and high-tech fields. It had revenue in the millions of dollars by mid-2002.

Large corporations find TEM software appealing because of the significant cost saving it can quickly identify. Rivermine said its software can save clients up to 30% on their telecom spending through automated bill auditing and inventory optimization, while reducing the headcount required to process service orders and invoices.

Rivermine said it would use the latest funding to enhance its products and services and increase support for global channel partners. - Olaf de Senerpont Domis

Should I send my business plan to a VC?

Mon, 26 Jan 2009 16:44:29 -0500

The following is from Ask The VC, where Brad Feld and Jason Mendelson of Foundry Group answer questions related to venture capital investment and startups:

Q: I just read your column in the January Issue of Entrepreneur and I had a follow up question. I am at the very beginning point of putting together my business plan. I have just started writing it and am fleshing out exactly how I envision the company running and what customer base I would want to target. I certainly would be looking for financing but I also feel that would really be important to the success of this business would be a group of people involved who can help with the various intricacies of getting a new company up and running. The long and the short of my question is should I send my business plan to VC firms when I have completed it or is there a better avenue to take at this point?

A: (Brad) My immediate reaction is "No!" For starters, my impression is that you probably aren't ready for VC money given your description of where you are in the process of creating your company. It sounds like you haven't started the company yet, but rather are working on the idea and using the business plan process to formalize your thinking. This is good, but it's a long way from being ready to approach VCs.

Given that you "feel that would really be important to the success of this business would be a group of people involved who can help with the various intricacies of getting a new company up and running." I'd find these people first. These are unlikely to be VCs. Rather, these are going to be business partners, mentors, advisors, and angel investors that can help you get things off the ground. Once you've made some progress, then you'll be ready to contemplate talking to VCs.

But - before you even do that, you need to decide how much money you actually need to get your business up and running. If you needs are modest (say - less than $1m) then it may be the case that VCs are the wrong funding choice for you and you should focus your energy on angel investors. Or, depending on the type of business you are trying to create, you might be able to bootstrap the business without raising any money.

So - bottom line - don't think of VCs as the first step in the process.

SpectraLinear clocks in with $10M

Mon, 26 Jan 2009 13:59:27 -0500

Timing chipmaker SpectraLinear Inc. has raised $10 million in a Series C financing round.

The startup, which makes tiny, low-power consumption, silicon-based components for electronic devices and systems, said the round came from existing investors InterWest Partners, Norwest Venture Partners, Velocity Interactive Group and ComVentures.

The round was led by Horizon Ventures. It will be used for working capital and to fuel development of new programmable products, the company said. It closed a $14 million Series B round in 2006.

SpectraLinear became the biggest pure-play company offering timing componentry after it acquired Cypress Semiconductor Corp.'s [CY] PC clock division in 2006 for an undisclosed price. - Olaf de Senerpont Domis

See Jan. 26 press release from SpectraLinear

N-trig lands $24M

Mon, 12 Jan 2009 13:00:20 -0500

N-trig Ltd., an Israeli developer of touch-screen technology for PCs and laptops, has raised $24 million from Microsoft Corp. [MSFT], Aurum Ventures, Challenger Ltd., Canaan Partners and Evergreen Venture Partners.

The startup's technology is deployed on certain models of Hewlett-Packard Co. [HPQ] and Dell Inc. [DELL] computers, it said. Microsoft reportedly contributed the largest portion of the funding and is working with N-trig to develop its technology to work with the latest version of the software giant's operating system.

"With the introduction of multi-touch in Windows 7, integrated with N-trig's DuoSense technology, our customers will have a new and natural way to interact with their PCs," said Microsoft group program manager for Windows client Ian LeGrow in a statement. "By simulating the way people write and touch naturally, N-trig is helping to make it easier to navigate your PC and enable a new class of Windows experiences."

The company announced a $28 million first round from Canaan and Evergreen a year ago. Before that it had received $22 million in previous investments. - Olaf de Senerpont Domis

See Jan. 12 press release from N-trig
See Jan. 12 article on N-trig from The Wall Street Journal

Omidyar Network delivers $4M to GoodMail

Mon, 12 Jan 2009 12:18:08 -0500

E-mail certification service provider GoodMail Systems said Monday it has raised $4 million in funding from Omidyar Network.The deal comes as part of a $5 million second closing of the company's Series C funding round, which now totals $25 million.

The first closing was announced in November; the round is led by Bessemer Venture Partners, with participation from DCM, Emergence Capital Partners and Softbank Capital. Added to the $26.2 million the company raised previously in institutional and angel rounds, total funding for GoodMail now sits at $51.2 million.

The company said the funding would help it continue to build its core product, CertifiedEmail, which enables nonspam messages with multimedia and other active content to be delivered and opened securely.

The company's service that lets businesses certify their outgoing mail so that it is not automatically directed to spam or trash baskets. GoodMail has partnered with seven of the 10 biggest ISPs, which collectively ferry more than half of all the e-mail in the U.S. and Europe, the company said.

Omidyar Network founder Matt Halprin will join GoodMail's board as part of the funding. -- Olaf de Senerpont Domis

See Jan. 12 press release fromm GoodMail Systems
See November 2008 post on GoodMail's Series C from Tech Confidential

Yodle raises $10M Series C

Mon, 12 Jan 2009 09:00:00 -0500

Online advertising startup Yodle Inc. Monday announced that it has raised $10 million in a Series C round led by Jafco Ventures.

Draper Fisher Jurvetson, which led the startup's $12 million Series B round in November 2007, as well as DFJ's Growth Fund and Bessemer Venture Partners, participated in the financing.

Yodle said the proceeds of the round would be used to double investment in development and to fuel a national sales expansion.

"This new funding round will accelerate product and technology development to provide increased online exposure and even stronger results for our local business owner clients," said Yodle CEO Court Cunningham, whom we spoke to after the company announced its second round.

Cunningham was an investor in Yodle's $2.6 million Series A led by Bessemer in 2006 before joining as CEO in April 2007. - Olaf de Senerpont Domis

See November 2007 post on Court Cunningham from Tech Confidential
See November 2007 post on DFJ's Andreas Stavropoulos and Yodle

SolFocus beams up $47.5M

Fri, 09 Jan 2009 12:36:04 -0500

Photovoltaic systems developer SolFocus Inc. has raised an additional $47.5 million in the first close of a Series C financing.

Apex Venture Partners led the round, with returning investors New Enterprise Associates and NGEN Partners also participating. SolFocus said it anticipates a second close on the round later this month.

The company's technology incorporates specialized mirrors, which concentrate sunlight onto highly efficient solar cells. The panels of mirrors are adjusted throughout the day by a tracking system that follows the sun's path through the sky.

SolFocus said the funding will help take the company's products from demonstration installations to large-scale commercialization. It also announced that it has named its president Mark Crowley as its new CEO. The company closed its $63.6 million Series B financing round in November 2007. - Olaf de Senerpont Domis

See Jan. 9 press release from SolFocus

SpotMixer grabs $9M second round

Wed, 07 Jan 2009 11:08:06 -0500

One True Media Inc., which operates online video ad service SpotMixer, has closed a $9 million Series B round.

The funding was led by new investor DAG Ventures and included backing from NTT Finance and Kleiner Perkins Caufield and Byers, which led One True Media's $5 million Series A round in 2006. DAG managing director Young Chung joins the startup's board as part of the transaction.

Like so many other startups that have announced funding in the past several months, One True Media pitched its SpotMixer service as one that will help small companies save money by allocating their ad dollars in a cost-effective way.

Using what the three-year-old company describes as a "self-service video creation and distribution technology," customers can produce, target and manage their own video ads. The company also announced Wednesday that it is an authorized video reseller on Google Inc.'s [GOOG] Adwords platform. - Olaf de Senerpont Domis

See Jan. 7 press release from One True Media

Granite Ventures leads $12.5M round for RipCode

Tue, 06 Jan 2009 12:34:34 -0500

RipCode Inc., which develops technology that helps transmit Internet video, has raised $12.5 million in a funding led by Granite Ventures.

Also investing in the round were previous backers Hunt Ventures, Eldorado Ventures, Vesbridge Partners and ATA Ventures. Granite managing director Eric Zimits joined RipCode's board as part of the deal.

RipCode received a second round worth $10.5 million in August last year. The company, founded in 2005, makes a network appliance for video transcoding that is designed to enable faster repurposing of mobile TV, social-networking video and studio-based productions. - Olaf de Senerpont Domis

See Jan. 6 press release from RipCode

2008 breaks 31-year record for VC-backed IPOs

Mon, 05 Jan 2009 10:36:22 -0500

The National Venture Capital Association and Thomson Reuters rang in the new year Monday with a final tally of 2008 venture-backed exits, and, as one would expect, the numbers were dismal.

The year ended with only six IPOs -- the worst performance since 1977 -- and 260 acquisitions of VC-backed startups, marking the first time in five years when the annual M&A tally dipped under 300.

There were no VC-backed IPOs in the fourth quarter, and only 37 acquisitions during the period.

Twenty-eight companies have filed S-1s and are waiting in the wings to go public, the latest being Penthouse magazine owner FriendFinder Networks Inc., which made its public aspirations known Dec. 23. But for the most part, the bad news continued in the waning days of the year, with two more tech companies -- online media startup NameMedia and Web ad services firm Eyeblaster Inc. yanking their IPOs on Christmas Eve. - Olaf de Senerpont Domis

See Jan. 5 press release from NVCA and Thomson Reuters
See FriendFinder profile from Renaissance Capital's IPOhome
See FriendFinder's Dec. 23 S-1 from SEC.gov
See March 11 post on Eyeblaster's IPO from Tech Confidential