AllThingsD » boutique

Code Advisors Takes a $25 Million Investment From J.P. Morgan

Kara Swisher — Thu, 03 May 2012 04:01:42 +0000

Code Advisors is getting a $25 million investment from financial services giant JPMorgan Chase for a minority stake in the Silicon Valley-based boutique investment bank and advisory firm.

The influx of cash will allow Code to grow quicker, said Quincy Smith, one of the firm’s founders, which also include Michael Marquez and Fred Davis.

The non-exclusive deal, the two firms said, is the natural extension of a longer-term relationship that has been developing for a while.

“To the extent that the money means we are getting even closer together, that’s great,” said Smith in an interview earlier today. “This solidifies a partnership that has existed for some time.”

Plus, it presumably also gives each what the other cannot offer clients. Usually a big bank might try to kill or buy a firm like Code, so this move is unique.

“We are growing our business and getting access to next-generation entrepreneurs that Code knows well,” added Kurt Simon, co-head of Technology, Media and Telecom Banking at J.P. Morgan. “And it’s a sign of continued investment in our important West Coast businesses.”

Indeed, J.P. Morgan has been competing with Goldman Sachs and Morgan Stanley for a higher profile in Silicon Valley. It recently was selected with the pair as one of the lead bankers in the upcoming Facebook IPO. It has also worked recently with LinkedIn, Skype and Pandora.

Code has taken on smaller deals with a range of hot start-ups and entrepreneurs, which was one of the attractions for J.P. Morgan. That includes representing Spotify and LivingSocial, and making investments in Path and Flipboard.

“For J.P. Morgan, it’s like making an limited partner investment in another venture firm,” said Smith. “And for us, we can offer a lot more services to our clients as they grow.”

As part of the deal, Jes Staley, CEO of J.P. Morgan’s investment bank and a member of the firm’s operating committee, will become a non-voting observer on Code’s board.

Here’s the full press release on the deal:

CODE ADVISORS ANNOUNCES A $25 MILLION INVESTMENT FROM JPMORGAN CHASE

San Francisco May 3, 2012 — Code Advisors announced today that JPMorgan Chase (NYSE: JPM) has agreed to make a $25 million minority investment. Jes Staley, CEO of J.P. Morgan’s Investment Bank and a member of the firm’s Operating Committee, will also act as a non-voting observer at Code’s Advisory and Investor Board meetings.

“We are thrilled that JPMorgan Chase has decided to invest in Code Advisors,” said co-founder Quincy Smith. “This transaction demonstrates how together we might energetically adjust to serve the new needs of entrepreneurs and companies. The chance to work more closely with Jes and his team gives us awesome global and experienced perspective.”

J.P. Morgan’s investment and relationship will allow Code to accelerate its growth opportunities and allow each team to offer complementary services to their respective and shared clients.

“Identifying and supporting great ideas early in their development is particularly important in the technology space,” said Staley. “Code continues to uniquely identify next generation companies, and together we are excited to help those entrepreneurs grow and expand their businesses.”

L.A. Stories: HipSwap Tries to Take the Creepy out of Craigslist (Video)

Kara Swisher — Mon, 02 Apr 2012 17:56:24 +0000

Last week, I visited Los Angeles to get a gander at some of the many digital companies that are doing some interesting things down south of Silicon Valley.

First stop: HipSwap, a community-based marketplace that is now in 14 U.S. cities after initial tests in Los Angeles and New York City.

Its goal is to de-creep the experience — because no matter how it’s done online, local buying and selling still has a lot of glitches. Using a visual approach (think Pinterest), with hipster social hooks (think Airbnb) and focusing on location (hmm, perhaps think Foursquare), complete with delivery in some cities, HipSwap is hoping to differentiate itself from big players in the space, such as Craigslist and eBay.

The app-heavy HipSwap allows anyone with stuff, including boutique merchants with quirky stuff to move, to quickly snap photos of items, price them and then — presumably — sell. Payment is made via PayPal or credit card, with HipSwap in between the buyer and seller, to ease the transaction’s typical awkwardness.

Because it is local, the items are varied, from trendy baby strollers to funky furniture to antique sewing machines. And, because it is in the L.A. area, HipSwap is also pushing celebrity fare, with a charitable “Shop My Closet” marketplace and video series, which recently included Kyle Richards from “The Real Housewives of Beverly Hills.”

The Santa Monica, Calif. start-up recently closed $1.1 million seed funding from a number of prominent investors, such as Founders Fund, Greycroft Partners, as well as former Microsoft exec — and early Pinterest angel — Hank Vigil and Mahalo President Jason Rapp.

Here’s a video interview I did with co-founder and CEO Rob Kramer about the interesting retail concept:

[ See post to watch video ]

Bring in the Suits: Yahoo Hiring Strategic Advisers to Plot Next Moves

Kara Swisher — Wed, 07 Sep 2011 03:54:46 +0000

Yahoo is preparing to hire investment bankers and other strategic advisory firms, said sources close to the Silicon Valley Internet giant, as it seeks to figure out what to do next at the company.

The board of Yahoo, which ousted its CEO Carol Bartz today in a unanimous decision, is exploring a range of possible strategies to turn around its moribund growth, including possible acquisitions, shedding units, bringing in new investment partners and even taking the company private or selling it.

A sale is the least likely of options, said sources close to the situation, but — given today’s news — Yahoo might attract a lot of attention from investors seeking to take advantage of the company’s powerful but troubled assets.

“It is all on the table,” said one source close to the company.

Independent board member David Kenny, president of Akamai, is heading the strategic options committee in charge of managing the process, sources said.

No adviser has been selected yet, but sources said Yahoo is likely to hire Allen & Co., which advises many tech and media firms. It is currently advising AOL, for example.

Other candidates would likely be the typical panoply of choices, including big investment banks like JPMorgan Chase, Goldman Sachs and Morgan Stanley, and smaller boutique firms such as Qatalyst Group and Code Advisors.

Sources said whoever is hired will be charged first with doing an extensive review of the company that is more intensive than has been done before.

“There is a potential for enormous growth that the company has not been capitalizing on and should,” said another source. “The board needs to get this company on a trajectory for growth.”

Indeed, it does, as it has not under the leadership of Bartz. Revenue growth has stalled and product innovation has lagged.

The company will also be conducting a search for a CEO, which will be difficult because any new top exec will want to be part of such a companywide review.

Yahoo’s choice of an executive search firm has also not been determined, but is likely to be one of the big companies that specialize in the arena.

One thing is certain, said multiple sources: Yahoo will continue to focus itself as what it has previously called a “premier digital media company.”

What that means now, of course, will be determined in the months ahead.

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