Liz Gannes

Recent Posts by Liz Gannes

Kleiner Perkins Leads $7M Funding for Payments Upstart Gumroad

Former Twitter engineering head Mike Abbott — now a partner at Kleiner Perkins Caufield & Byers — has made his first investment: Leading a $7 million round for payments start-up Gumroad.

It’s a significant boost for a year-old start-up that has just three employees and is led by 19-year-old founder Sahil Lavingia, who was previously an early designer at Pinterest.

Gumroad is a tool for creators to charge money for their content online. It gives them simple links they can share on Twitter and elsewhere.

Lavingia said the premise of his company is based around the realization that “There’s no lemonade stand on the Internet; there’s no foot traffic.” He acknowledged that there is lots of competition in the payments space, but said, “There’s been a lag time between payments and the democratization of everything else.”

Gumroad investors, including Accel Partners, SV Angel and Lowercase Capital, previously gave the San Francisco-based company $1.1 million in a seed round collected late last year and early this year. Lavingia boasted that he had his pick of investors for his Series A round, and chose Abbott because of his technical leadership chops.

Gumroad takes a 5 percent cut plus 25 cents, pricing that is designed to be competitive with iTunes, Lavingia said. Creators can maintain a direct relationship with purchasers by getting their email addresses. Tens of thousands of sellers have tried the system.

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Another gadget you don’t really need. Will not work once you get it home. New model out in 4 weeks. Battery life is too short to be of any use.

— From the fact sheet for a fake product entitled Useless Plasticbox 1.2 (an actual empty plastic box) placed in L.A.-area Best Buy stores by an artist called Plastic Jesus