And while some people called to question that assertion, there’s no question that something interesting is clearly happening at Vidyo. Today it will get only more interesting.

You may remember how, in that previous story, I mentioned that Vidyo had raised a $22.5 million Series D round of funding led by QuestMark Partners, with Menlo Ventures, Rho Ventures, Star Ventures and Four Rivers Group all participating. Vidyo left that round open and now Juniper has joined it though the precise amount is not being disclosed.

Today, Vidyo says its total capital raised has reached about $97 million, and that Juniper Networks is making a strategic investment by way of its Junos Innovation Fund. While Vidyo isn’t exactly saying what the terms of the investment are, it’s pretty easy to do the math. (Earlier I had portrayed this as a $97 million Series D. Clearly I got a little confused. Sorry about that.)

The investment round will basically help Vidyo boost its go-to-market activities, but it will also give Juniper a big benefit by allowing Vidyo to integrate its videoconferencing products with Juniper’s numerous offerings. That will likely give it some new competitive plays against rival Cisco Systems, which has considerable video offerings. We’ll see how that turns out.

Video Conferencing Seen as Important and Growing Sector

Hackensack, NJ – May 22, 2012 – Vidyo, Inc., the world’s fastest-growing video conferencing company, today announced that Juniper Networks, the industry leader in network innovation, is joining as a strategic investor through its Junos® Innovation Fund, alongside lead investor QuestMark Partners and other existing investors Menlo Ventures, Rho Ventures, Star Ventures, and Four Rivers Group. Though terms of the investment were not disclosed, Vidyo has raised $97M to date to accelerate its growth. The investment from Juniper Networks enables Vidyo to increase its go-to-market activities and integrate its video conferencing products with Juniper’s numerous offerings.

According to numerous analysts, Vidyo is disrupting innovation in the video communications and collaboration market, driving the industry forward with its paradigm-shifting platform. Vidyo delivers telepresence-quality conferencing to more than 1850 enterprise, healthcare, education, and government customers. Juniper Networks is leading the charge to architecting the new network based on a unique single architecture and single operating system, Junos®, that ensures performance, reliability and security without compromise and at the scale customers demand.

“As the use of video in the enterprise and on end devices continues to expand, our customers are seeking new ways to improve video delivery,” said Jeff Lipton, vice president, Venture and Strategic Investments, Juniper Networks. “Vidyo is an emerging player that is driving innovation in software-based videoconferencing, and we believe its leading technology will improve the experience and economics of video communications alongside advances in networking technologies.”

“Juniper Networks’ strategic investment in Vidyo is a solid endorsement of our vision and a recognition of how rapidly the videoconferencing market is expected to grow in the near future; Infonetics Research states the market will reach a cumulative $22 billion over the next 5 years,” said Ofer Shapiro, Vidyo’s co-founder and CEO. “We see Juniper as a kindred spirit, itself a pioneer in its industry, having revolutionized networking for over 16 years. Their investment validates the approach we have taken to successfully create new video conferencing markets and deliver superior value, accessibility and scalability to our customers and partners. We are extremely honored that such a world-renowned leader recognizes the unique strengths and proven abilities of Vidyo that are driving the video communications industry forward.”

The Vidyo Difference

The Vidyo communication and collaboration platform is software-based, highly flexible and can be easily customized for individual enterprise and vertical market video conferencing needs. The patented VidyoRouter™ architecture introduces Adaptive Video Layering™, which dynamically optimizes the video for each endpoint leveraging H.264 Scalable Video Coding (SVC)-based compression technology and Vidyo’s IP. Adaptive Video Layering eliminates the MCU and offers unprecedented error resiliency, low latency rate matching thus enabling natural, affordable, high-quality video to work over the Internet, LTE and 4G networks. The platform allows users to quickly leverage the latest hardware innovations, new consumer devices and partner applications that utilize Vidyo’s APIs, such as the recently announced partnership with Philips and AMD in the Healthcare industry. Vidyo has been active driving H.264 SVC and SIP videoconferencing interoperability in various standards bodies since 2005.

About Vidyo, Inc.
Vidyo, Inc. pioneered Personal Telepresence enabling natural, HD multi-point videoconferences on tablets, smart phones, PCs and Macs, room systems, gateways, telepresence solutions and affordable cloud-based broadcast solutions. Headquartered in the US, with 12 additional international offices, the company has more than 225 employees and has to date raised $97M. Learn more at www.vidyo.com, on the Blog or follow @vidyo on Twitter.

Today, AnchorFree announced that Goldman Sachs has made a $52 million Series C investment. Prior investors include RENN Capital. The investment brings its total capital raised to $63 million.

AnchorFree makes Hotspot Shield, a simple VPN tool that’s in use by some 60 million people around the world. It’s the creation of David Gorodyansky and Eugene Malobrodsky, who started the company in 2005 just after finishing college.

During the Tahrir Square uprising in Egypt, the company recorded more than a million downloads of the product in a single night. It’s now in use in 190 countries. The point of the capital raise is simple: Push the number of users higher still. There are, after all, some 1.6 billion people using the Internet.

As AllThingsD reported several days ago they would, Yahoo and Alibaba Group have finally reached an agreement for the Silicon Valley Internet giant to sell back half its stake in the Chinese Web company in a $7 billion deal.

The taxable shares sale agreement, which is now being approved by both boards, is part of a larger and more complex arrangement, which will also include a multibillion-dollar stock buyback by Yahoo and an eventual IPO of Alibaba.

And, perhaps most importantly, it will bring to an end what could be the longest running global cat fight in Internet history, in which the long-time partners have bickered over the terms of their relationship for years now.

It has mostly been over how they could get to the transaction they should be announcing later tonight (or morning in Hong Kong, which it is there now). While it could fall apart at the last minute, that is highly unlikely at this point.

(Update: The Yahoo board has approved the deal unanimously, said sources, so it is done done.)

(Update 2: Yahoo and Alibaba both confirmed the deal in a joint press release, which is below.)

Thus, after many failed attempts to strike a tax-free deal — also involving Yahoo’s Japanese partner, SoftBank — collapsed, the pair have finally settled on a taxable deal, which could net Yahoo upwards of $4 billion.

The transaction values Alibaba at $35 billion and is subject to a number of funding issues that could change the value of the deal.

But here is the overall situation, as I previously reported:

Yahoo is set to sell half of its roughly 40 percent stake in Alibaba, in a taxable deal. The transaction is likely to value that portion of Yahoo’s holdings at about $7 billion — or 20 percent of Alibaba’s $35 billion enterprise valuation. Alibaba is in the midst of raising capital to fund the sale.

After taxes of upward of 35 percent are paid on the long-term gains — remember that Yahoo bought the now-lucrative Alibaba stake for just $1 billion in 2005 — the company will use the funds to buy back its own shares. That stock has been caught in the mid-teens doldrums for quite a while, so this could help boost shares significantly.

A shareholder dividend is also being considered by the Yahoo board, but it is unlikely. It’s also not clear if some of the cash will be held back for acquisitions by Yahoo, sources added, but it is also unlikely.

As part of the deal, sources said, medium-term incentives have been put in place for Alibaba to move forward with a public offering, which sources stressed is without contractual obligation or a time frame. Alibaba execs have already been publicly indicating such a direction recently, but this will put them more firmly on that path.

Although there are no plans to go public as yet, the IPO incentive revolves around several terms, including the right to buy back half the remaining stake, which expires in December of 2015. As I previously reported, Yahoo will be required to sell back half of the 20 percent remaining stake upon IPO and the other half after that if Alibaba goes public in the time frame agreed to.

Lastly, the Alibaba voting rights for both Yahoo and SoftBank are much diminished in the new deal, according to sources, to under 50 percent.

Translation: Alibaba CEO Jack Ma is now in the driver’s seat completely.

Once close, the pair have been wrangling over the large Yahoo ownership, which Ma has been trying to dislodge in a variety of nice and not-so-nice ways. It has resulted in a number of very public disagreements.

That included a nasty back-and-forth over its Alipay unit with now-fired CEO Carol Bartz, threats of takeover of Yahoo with private equity firms and, more recently, making friendly with its just-ousted CEO, Scott Thompson.

Those talks with him in recent weeks, which included a visit to China by Thompson, led to the new deal, which was negotiated primarily between Yahoo’s CFO Tim Morse and legal head Mike Callahan and Ma and Alibaba’s Joe Tsai.

The talks continued even as Thompson was suddenly engulfed in a controversy over a fake computer science degree on his resume that quickly led to his departure from Yahoo.

Ironically, the error was first discovered by activist shareholder Daniel Loeb, who is now voting on the deal as a newly named director of Yahoo, after successfully helping to oust Thompson.

He owns almost 6 percent of Yahoo.

The final decision to approve the deal was in the hands of a very new board of Yahoo, which has been drastically reshaped in recent weeks. It met to decide on the deal this weekend.

While the deal with Alibaba is finally nearing an end, Yahoo’s talks to sell its 33 percent stake in Yahoo! Japan is not part of this agreement. That’s due to what Thompson had called a “valuation gap,” which sources said is still an outstanding issue.

New interim CEO Ross Levinsohn has not been involved in the Alibaba deal in any significant way. But he certainly will benefit from its halo effect, if approved, especially given that it will likely boost Yahoo shares.

It also puts Yahoo in a unique situation, in which it must sink or swim more largely based on the value of its troubled core business.

That could mean a lot of things, including the eventual sale of the company, whose most lucrative asset recently — its Alibaba holding — will matter much less.

As soon as I get the press release, I will post it here, but no one is commenting, despite the inevitable happy ending to this long-running story.

And here’s the press release, finally:

Yahoo! and Alibaba Reach Agreement on Comprehensive Plan for Alibaba Stake Agreement Realizes Significant Value, Immediate Liquidity and Path to Future Monetization

Yahoo! Board Increases Share Repurchase Plan by US$5 Billion

May 20, 2012 — Sunnyvale, California and Hangzhou, China – Yahoo! Inc. (NASDAQ: YHOO) and Alibaba Group Holding Limited today announced they have entered into a definitive agreement for a staged and comprehensive value realization plan for Yahoo!’s stake in Alibaba.

The first step is the repurchase by Alibaba of up to one-half of Yahoo!’s stake, or approximately 20% of Alibaba’s fully-diluted shares. The purchase price will be based on a valuation of Alibaba to be established through equity financings that Alibaba intends to undertake to finance the transaction, subject to a floor valuation of approximately US$35 billion. The agreement includes substantial financial incentives for Alibaba to raise the additional equity at a valuation higher than US$35 billion. At the minimum price and assuming the initial repurchase of the full 20% stake, Yahoo! would receive from Alibaba consideration of approximately US$7.1 billion, composed of at least US$6.3 billion in cash proceeds and up to US$800 million in newly-issued Alibaba preferred stock.

The agreement also establishes a framework for Yahoo! to monetize its remaining interest in Alibaba in stages. First, at the time of an initial public offering (IPO) of Alibaba in the future, Alibaba will be required either to repurchase one-quarter of Yahoo!’s current stake at the IPO price or allow Yahoo! to sell those shares in the IPO. Second, following such an IPO, Yahoo! has registration rights and rights to marketing support from Alibaba to enable Yahoo! to dispose of its remaining shares, at times of Yahoo!’s choosing following a customary lock-up period.

This agreement is a result of extensive discussions between the two parties and a comprehensive review of both taxable and tax-efficient alternatives. Yahoo! and Alibaba believe this agreement to be the best path to align incentives and maximize value for shareholders of both companies and it paves the way for Alibaba to achieve future public market liquidity for all of Alibaba’s shareholders. For Yahoo!, the agreement provides for a staged exit over time, balancing near-term liquidity and return of cash to shareholders with the opportunity to participate in future value appreciation of Alibaba.

“Today’s agreement provides clarity for our shareholders on a substantial component of Yahoo!’s value and reaffirms the significance of our relationship with Alibaba,” said Ross Levinsohn, Interim CEO of Yahoo!. “We look forward to continued collaboration with the Alibaba team on business initiatives as we explore joint opportunities for growth and benefit from Alibaba’s future. I want to thank Jack Ma, Joe Tsai and the Alibaba team, as well as Tim Morse, Michael Callahan and our Yahoo! team for their dedication in achieving this successful outcome.”

“This transaction opens a new chapter in our relationship with Yahoo!,” said Jack Ma, Chairman and Chief Executive Officer of Alibaba Group. “I look forward to working with Ross Levinsohn and the Yahoo! team as Alibaba builds China’s leading e-commerce company. Yahoo!’s global audience reach will provide attractive partnership opportunities for Alibaba to explore markets outside of China. The transaction will establish a balanced ownership structure that enables Alibaba to take our business to the next level as a public company in the future.”

“We look forward to delivering the proceeds of the near-term transaction to our shareholders, and to the further enhancement of value and the additional monetization in the future that this agreement enables,” said Timothy R. Morse, Executive Vice President and Chief Financial Officer of Yahoo!.

In addition to the share repurchase, the companies have also agreed to amend their existing technology and intellectual property licensing agreement. Among other things, this amendment will result in Yahoo! granting Alibaba a transitional license to continue to operate Yahoo! China under the Yahoo! brand for up to four years, while restrictions on Yahoo!’s ability to make other investments in China will be terminated. Alibaba will make an upfront lump sum royalty payment of US$550 million to Yahoo! and continuing royalty payments for up to four years. In addition, Alibaba will license certain patents to Yahoo!. Upon closing of the repurchase transaction, the Alibaba shareholders’ agreement will be amended so that the parties’ respective rights will be commensurate with the parties’ post-closing level of ownership in Alibaba. Yahoo! will continue to be represented on Alibaba’s board of directors with the right to appoint one of four existing directors.

Yahoo! intends to return substantially all of the after-tax cash proceeds to shareholders following the closing of the transaction. While the form of the return of capital to shareholders has not yet been finalized, Yahoo!’s board has increased Yahoo!’s share buyback authorization by US $5 billion concurrently with this transaction.

The transaction is subject to customary closing conditions. Alibaba will be required to close the repurchase with respect to at least one-quarter of Yahoo!’s current stake in Alibaba regardless of the amount of financing raised, and up to one-half of Yahoo!’s current stake if it obtains the requisite financing. Alibaba intends to finance the repurchase through a combination of its own cash resources, debt, equity and equity-linked financing. The transaction is expected to close within approximately six months.

UBS Investment Bank acted as lead financial advisor to Yahoo! and Allen & Company LLC and Goldman Sachs & Co. also served as financial advisors. Skadden, Arps, Slate, Meagher & Flom LLP acted as lead legal counsel to Yahoo! and Weil, Gotshal & Manges LLP also acted as legal counsel. Munger, Tolles, & Olson LLP acted as legal counsel to the Yahoo! Board of Directors. Credit Suisse acted as lead financial advisor to Alibaba and Wachtell, Lipton, Rosen & Katz acted as lead legal counsel to Alibaba. Freshfields Bruckhaus Deringer LLP acted as counsel to Alibaba on certain financing and Hong Kong legal matters and Fenwick & West LLP acted as counsel to Alibaba on intellectual property matters.

The funding is expected to be announced tomorrow morning.

(Update: Rakuten confirmed the deal in a press release, which is below.)

The Tokyo-based Internet giant will invest upwards of $50 million in a $100 million round that values the social bookmarking phenom at $1.5 billion.

There might be other individual investors in the new round, but those were still to be determined tonight by Pinterest co-founder and CEO Ben Silbermann.

(Correction: We previously reported it was a $120 million round, but sources said it is $100 million. It’s possible more could still be added, as we heard conflicting accounts.)

While the latest round of funding for Pinterest has been the most hotly sought of late in tech circles, one source said Silbermann was looking for a global strategic investor and had talked to several large Asian companies.

Said one source on why he settled on Rakuten: “He just really liked them.”

The current investors in Pinterest, which is a social collection site where users can “pin” their interests via a handsome graphical interface, include Andreessen Horowitz, Bessemer Venture Partners and FirstMark Capital, as well as several well-known angel investors. That group had valued the company at $200 million last October, and are joining the new round pro rata.

Founded in 2008, Pinterest had previously raised a little under $40 million in funding.

It’s interesting that the latest round was not led by an institutional investor, since everyone and their mother wanted in on the deal. Sources said no new venture capital firms were included in the round and that is the way Pinterest’s quirky leadership wanted it.

Sources said Silbermann has been concerned with Pinterest’s global growth as well as fending off international clones, and was looking for a partner with which the start-up could work closely.

“Ben did not want any more VCs,” said one source. “He wanted an investor that moved the company forward.”

Rakuten will presumably help advise Pinterest on turning their pretty pictures into purchases, as commerce is already starting to emerge naturally on the site.

It’s a good choice of partners in that regard. Rakuten is one of the largest e-commerce companies in the world, with a flagship site Rakuten Ichiba. It was founded in 1997 and had revenues of $4.7 billion in 2011. Its CEO is Hiroshi Mikitani, whose nickname is Mickey.

One the richest men in Japan, Mikitani is one of the best known entrepreneurs there; he has been described as “Richard Branson meets Jeff Bezos.”

Earlier today, The Next Web reported that the funding was coming this week and said the company was looking at international partners, but it did not name Rakuten.

Rakuten Leads Investment In Pinterest

Global social commerce pioneer takes stake in online sharing service

TOKYO, May 17, 2012 – Rakuten, one of the world’s largest online marketplaces, today announced that it is leading a $100M investment in Pinterest, with participation from existing investors Andreessen Horowitz, Bessemer Venture Partners, and FirstMark Capital, as well as a number of angel investors.

The funding will allow Pinterest to continue improving its service and expanding its community globally. The investment also marks the start of a strategic partnership between Rakuten and Pinterest to help expand in Japan and into Rakuten’s 17 other global markets.

Hiroshi Mikitani, CEO of Rakuten said: “While some may see e-commerce as a straightforward vending machine-like experience, we believe it is a living process where both retailers and consumers can communicate, discover, and curate to make the experience more entertaining. We see tremendous synergies between Pinterest’s vision and Rakuten’s model for e-commerce. Rakuten looks forward to introducing Pinterest to the Japanese market as well as other markets around the world.”

Ben Silbermann, co-founder and CEO of Pinterest, said: “Our goal is to help people discover things they love, by connecting people through their shared interests. Bringing Rakuten on board gives us an amazing opportunity to move a step closer to this goal.”

Rakuten ranks among the top 10 internet companies in the world. Among its numerous online properties, its flagship B2B2C (business-to-business-to-consumer) model e-commerce site Rakuten Ichiba is the largest e-commerce site in Japan and among the world’s largest by sales. Its global presence has been reinforced through the acquisitions of leading online marketplaces Buy.com (US), Priceminister (France), Ikeda (now Rakuten Brasil), Tradoria (now Rakuten Deutschland) and Play.com (UK), and investments in Ozon.ru and AHA Life. Whereas other marketplaces may compete directly with sellers, Rakuten’s model seeks to empower merchants to deliver Omotenashi, a Japanese high service mindset, which helps sellers create lasting relationships with customers.

And here’s a video of Kara pontificating away on the subject for WSJ.com’s “Digits” show:

Curalate’s pitch: You need basic information about the way users and potential customers are interacting with your products on Pinterest, but it’s very hard to do it on your own, because users usually don’t identify the products they’re “pinning,” so there’s no effective way to search for your stuff.

The company says it can solve that with image-recognition technology, which it licenses from a  third party, and an analytics engine it created itself.

Curalate’s arrival is inevitable, because every big social platform eventually spawns a set of third-party analytics/brand tracking companies — see Twitter, Facebook. But the company didn’t exist a few months ago.

Up until late last year, Gupta’s company was called Storably, and it was pursuing another hot start-up meme, as an “Air BNB for parking and storage.”

But that one never got traction and, after six months, Gupta — a Philadelphia-based Wharton grad — looked for a pivot. He and his four-man team cast around for a new idea and, after considering some 70 ideas, landed on Curalate. At the end of 2011, the company raised a $750,000 seed round from NEA, First Round Capital and MentorTech Ventures.

Now Gupta says he has 150 customers, including Kraft Foods and Time Inc.’s “Real Simple,” and he charges them up to $99 a month for his services.

That pitch is also fueling a whole lot of start-ups, who want to piggyback on Facebook’s ascent by helping advertisers shovel money into the site.

Today’s example: Adaptly, which manages Facebook ad campaigns and also helps marketers buy ads on other social platforms, like Twitter and StumbleUpon.

The NYC-based company has raised a $10.5 million B round, led by Valhalla Partners; the company also brought in Time Warner Investments and Vivi Nevo as new investors. Adaptly had previously raised $2.7 million.

The company is run by freakishly young cofounders — Nikhil Sethi, 23, and Garrett Ullom, 22, both fresh out of Northwestern (Ullom didn’t stick around to graduate). Sethi (pictured above) says his company booked $10 million in gross revenue in 2011, and will “greatly exceed that” this year. (Update: That’s actually $10 million in gross bookings, not revenue, Sethi says. Thanks to Steven Kane for the nudge.)

Adaptly has around 50 employees, a bunch of whom have migrated there via Invite Media, the ad tech start-up Google bought in 2010. The two companies share a few other ties: Both have been backed by Philly’s First Round Capital, and Invite CEO Nat Turner has invested in Adaptly as well. Small world.

(An earlier version of this story incorrectly reported that Invite Media was a product of the Dreamit Ventures program.)

The search giant is set to invest in Machinima, one of the most popular networks on YouTube, via a funding round that should close within a month. Machinima focuses almost exclusively on YouTube videos for and about videogame players, and generates more than a billion views a month.

People familiar with the round tell me it should end up raising more than $30 million, and will value the company at around $190 million, post-funding. No comment from Google or Machinima.

Google will be one of several investors backing Machinima in this round. And even if it put in the entire amount itself, it wouldn’t be material for a company that did $8.1 billion last quarter.

But the move has significant symbolism, because it’s the first time Google has openly backed a content company by taking an equity stake. YouTube is spending more than $100 million on its much-publicized channel program, but it is writing those checks as loans to content makers, and it recoups the money via ad sales.

The deal may ruffle some feathers among other video makers, some of whom already complain that YouTube favors Machinima and a handful of prominent content partners. And people familiar with the funding round tell me that at one point Google considered routing the investment through its Google Ventures arm to try to allay those concerns.

The counter to that argument: Why shouldn’t Google back content producers who make stuff for its properties? After all, YouTube is trying to become more like TV. And most of the big TV networks own their own studios outright.

WePay CEO Bill Clerico

Among many competing payments providers, one thing that stands out about WePay is how it’s driven by social sharing. Almost half of WePay’s traffic is referred by Facebook, CEO Bill Clerico said yesterday on a panel we were both on at the Startup Conference in Mountain View, Calif.

A rep for the company said the exact Facebook referral stat is 43 percent — and much higher for campaigns like this one to support a family that lost seven members in a car crash.

Palo Alto, Calif.-based WePay, which initially launched as a groups payments tool, has raised a total of $20 million from Ignition, Highland Capital Partners, August Capital, Y Combinator, SVAngel, Dave McClure, Mark Goines, Steve Chen, and Max Levchin.

Unlike many other companies of this era, Evernote has known exactly what it was since the beginning — it just took some time for users and investors to catch on.

A while back I interviewed Evernote CEO Phil Libin about Evernote’s steadfast strategy for both its product and business model. On the occasion of Evernote’s sky-high valuation, Libin’s experience seems particularly compelling — and unusual.

“It’s almost like if you don’t pivot three or four times you’re doing it wrong,” he joked about today’s tech start-ups.

But in fact, Evernote had the tagline “remember everything” on the first day the company was formed in 2007, and it planned a freemium payment model from the beginning, Libin said.

“We said we wanted to make an external brain for everyone,” Libin said — as he has said many times in the past five years. “The driving force was no one is really happy with biological memory.”

But a good idea and a business model weren’t enough. Libin tried to raise money in the summer of 2008, a few months after Evernote launched and before it had much traction. He had a funding deal set up, set to close the day Merrill Lynch went bust. The investors told him they’d just lost 60 percent of their value so were pulling out.

At that point Evernote had four weeks of money in the bank.

Libin looked around for other investors for a week. Some potential investors told him they would fund Evernote if the start-up switched its business model from users paying for premium features to selling advertising about users’ interests.

“They said if you’re successful, you will have the holy grail of targeted adverting because people are telling you what’s important to them,” Libin said. “We considered that very briefly but I was never comfortable with that model. I always thought it would undermine the trust. We turned that down. We’d said we’d rather shut the company down.”

Other investors suggested an enterprise product, but Libin thought that would be odd because Evernote is, by design, made for both professional and personal use. Splitting the product into two versions felt false.

With three weeks left before forced shutdown, Libin was awake at 3 am. He said he told himself, “I’m going to go into the office and act like an adult for the first time in my life” and tell the staff it’s over so the company could close down on its own terms.

Sitting at his computer thinking his company was done, Libin noticed a new email from someone he didn’t know. Turns out it was an Evernote customer from Sweden saying how much he loved the product and wondering if the company was looking for any outside investment.

“Twenty minutes later we were on a Skype call,” Libin recalls. “He wired us half a million dollars within two weeks.”

The Swedish investor has asked to remain unnamed, Libin said, describing him as a computer nerd who started and sold a company. The two men have never met face to face.

The emergency funding from the mysterious benefactor paid off. A few months of keeping the company alive delivered the data to show that Evernote’s product and freemium model were working. It was able to raise its first institutional funding from Troika Ventures (which earlier this year sold its stake to Sequoia Capital for what’s estimated to be more than $45 million).

“I think if that email had come 10 minutes later I probably wouldn’t have seen it, and I probably wouldn’t have opened an email from a name I didn’t recognize in the morning,” Libin said.

Libin believes the fact that Evernote was saved by a happy customer was a proof point, in and of itself. “The guy from Sweden might not have fallen in love if it was an advertising company,” he said.

Why was Evernote, at the brink of being shut down after barely getting started, able to brush off potential investors who wanted to change its core premise? Libin said he could think of two reasons.

First, Evernote put a ton of work into building its own analytics tools and figuring out what to measure.

“I think the most important thing for us was really having a set of metrics and measurements so we didn’t have to make any blind, panicked major turns,” Libin said. “If you can’t see where you’re flying, it’s easier to start panicking and turn the flightstick around.”

And second, Evernote is not Libin’s first company — he’d previously sold two others — so he had confidence in himself and his convictions, and he didn’t necessarily need the job.

“It was easier to say ‘no one is forcing me to do this,’” Libin said. “We don’t want to get into targeted advertising? That’s fine.”

“I think if this was my first time around I’d be a lot more eager to please the market and the investors,” he added. “Maybe that’s a luxury.”

Photo credit: @jibees for LeWeb11 Conference

And if you combine the two? You get Vungle, a barely hatched start-up that just raised a $2 million seed round.

Vungle’s pitch is straightforward: They help app developers make video promo reels for their stuff, and turn them into “in-app” ads (you can see a sample below). There are a whole lot of ways to buy in-app advertising for other apps already — it’s a big chunk of the mobile ad business right now — but the Vungle guys argue that they make it easy. And that unlike iAd, AdMob, Millenial, etc., it’s all they do.

Fair enough. No way to really tell now, as the company is only in “alpha,” with a handful of paying customers that include Path, the buzzy next-gen social network, and Pocket Games, a game developer. A more open beta comes this summer.

At least as interesting as the pitch is the backstory, which has co-founders Zain Jeffer, 24, and Jack Smith, 23, leaving London on a whim to join the AngelPad start-up factory last fall, then finding themselves in a whirlwind round of financing. For instance, they pitched Crosslink’s David Silverman at his home on a weekend, and got a commitment a day later.

Multimillion dollar seed rounds would have been unheard of a couple years ago. Now they’re increasingly commonplace (here’s one for $4.2 million), at least for a certain class of incubator-blessed start-ups. And they’re part of the reason that you’re hearing lots of bubble talk right now.

For the record, the Vungle guys say they had no intention of raising so much out of the gate. But “as soon as you tell people you don’t want money, that’s when they want to give you money,” Smith says. Among those chipping in: Google Ventures, AOL Ventures, Ron Conway, Dave McClure, Charles Hudson, Maynard Webb, Scott McNealy and Tim Draper.

But for the record: Marc Andreessen, who is now perhaps Silicon Valley’s most prominent investor, does not think we’re in a bubble.

Andreessen has been saying this for some time — like a year ago, at All Things Digital’s D9 conference – and he repeated himself at Wired magazine’s business conference this morning.

The main thrust: This can’t possibly be a bubble, because leading technology firms like Apple are trading at relatively modest multiples. Meanwhile, most of the highly celebrated tech companies that have gone public in the last year, like Demand Media, Groupon and Pandora, have all seen their stock prices get hammered.

“If we’re in a bubble, it’s the weirdest bubble I’ve ever seen, where everybody hates everything,” Andreessen told Wired editor Chris Anderson.

But that’s the public market, Anderson pointed out. What about the private deals, where very young start-ups are frequently being valued at $1 billion or more?

Well, maybe there’s something off there, Andreessen conceded. A “strangeness in the way the market is behaving.” Some of that stems from the way that capital is flowing, because institutional investors are looking for places other than the stock market to park their cash. But that’s only relevant for a “small number” of companies and investors, so that can’t qualify as a bubble, either.

We will listen respectfully to Andreessen, because he has a big brain, and has been intimately involved in a bubble or two himself (that 1996 Time magazine cover featuring him marked the beginning of the Web 1.0 irrational exuberance phase). But for a commonsense, plain-English counterpoint to all of this, see BuzzFeed. (Really!)

That brings Simulmedia’s total raise to some $27 million over three years. That money is going into Morgan’s take on “targeted” TV advertising, which promises to merge Web-style targeting with traditional TV ads.

There are lots of people chasing targeted TV ads, and to date none of them have gotten very far. Canoe Ventures, a consortium led by Comcast, Time Warner Cable and the rest of the cable industry, just imploded earlier this year.

The TV guys will probably get there, someday. But in the meantime, Morgan is trying a slightly less ambitious version that he says can work now.

Rather than trying to deliver customized ads to every TV viewer based on their individual set-top-box data, Simulmedia uses some set-top-box data (which it gets from providers like DirecTV, TiVo and AT&T) to try to find undervalued ad inventory. So, in theory, it can help an advertiser find a cheaper way to get in front of a specific audience it wants to reach.

If that sounds a bit like Web advertising, that makes sense. Morgan built two pioneering Internet ad companies — 24/7 Real Media and Tacoda, which were acquired by WPP and AOL — before tackling TV.

Simulmedia says it has run 200 campaigns for 24 brands since it pivoted to its current model (it had originally tried using the same technology to target TV advertising for TV programming), and Morgan says he is “very close to profitability.” This is the second time Morgan has funded the company with an inside round: The same group of investors put in about $9 million a year ago.

The three-year-old “big-data” company has now raised some $23 million, and is using the new money to expand into additional business lines.

Metamarkets started out providing data tracking and analytics to digital publishers like AOL, Demand Media and the Financial Times, so they could get a better handle on the value of their ad inventory.

But now it is branching out into other industries where companies generate enormous streams of data, like social media and payment start-ups.

CEO Mike Driscoll won’t disclose the names of his clients in these new categories. But Twitter and Square sure seem like obvious candidates. And it’s worth noting that Foursquare generates an awful lot of data, and Foursquare CEO Dennis Crowley has made angel investments in Metamarkets.

It’s also worth noting that Driscoll, who co-founded the company and was its CTO, wasn’t CEO until January. He replaced co-founder David Soloff, who Driscoll says now works as a “close adviser” to the start-up.

My understanding is that the swap is at least partly related to that buyout offer Metamarkets didn’t take. People familiar with the company say that Soloff was interested in taking the deal, while his backers wanted him to build a bigger company — and generate a bigger return on their investment.

Driscoll won’t comment on the story behind the change. But he notes that the new funding makes it clear that “Metamarkets is not interested in going out for a small amount of dollars anytime soon.”

“I think too many people in Silicon Valley are shortsighted,” he says. “This is a huge space, and the opportunity is massive.”

(Image courtesy of Shutterstock/sommthink)

At Y Combinator’s Demo Day, a short Ark pitch delivered in the midst of 64 other start-up presentations got the company commitments for $2 million in funding in a single day. And more than 250,000 people have signed up for Ark beta invites.

Less than a month after Demo Day, Ark now tells me that it has raised a $4.2 million seed round from investors including Andreessen Horowitz, Charles River Ventures, Greylock Partners, Intel Capital, SV Angel, Atlas Ventures, Crosslink Capital, Expansion Venture Capital, Felicis Ventures, Lightbank, Salesforce, Tencent, Transmedia Capital, and a bunch of individual angel investors.

That’s the largest seed round ever raised by a Y Combinator company. Update: Paul Graham of Y Combinator says the program does not track such statistics, so he cannot confirm that Ark’s is the largest seed round to date. Thus, I’ve updated the headline to “biggest seed round in memory” from “biggest seed round ever.”

The round benchmarks Ark as a clear front-runner in the most recent batch of the program’s closely watched start-ups. (Though to be fair, I’ve heard other top companies in the winter class are also cleaning up.)

Ark is almost too good to be true — a search engine that combines public and personalized search for people. It promises to transcend the current stalemate in social search between Google, Twitter and Facebook.

And it actually is too good to be true — right now, Ark is basically a simple interface to sort Facebook profiles by current city, gender, school, work, interests and other categories. Only 15,000 people have gotten beta access, as Ark has already fully maxed out its Amazon Web Services account by searching their networks and public data.

Ark co-founder and CEO Patrick Riley

But Ark CEO Patrick Riley, who was previously working on his Ph.D. at UC Berkeley’s School of Information, is clear about his ambition. “Google seems so out of touch without the rest of us,” he told me last week. “They’ve lost their neutrality.”

The rift between Google and Facebook leaves social search dramatically underdeveloped, Riley said (and it’s a point I’ve argued, as well).

“Politics have left open this enormous opportunity,” is how Riley put it.

Part of what’s hard about social search is that Facebook prohibits outside crawlers. But Riley said he’s confident that he can get Facebook data, because he has gotten advice from Facebook CTO Bret Taylor, and has worked with Facebook’s legal team to make sure everything’s kosher.

So why should anyone care about “people search”? Beyond the age-old attraction of researching and stalking people, Riley described Ark as an automated “About.me of everyone,” that collates various social profiles.

Riley also said Ark is planning to beef up its social-discovery tools, so users can find new activity and interest partners inside and outside their networks. There will also eventually be an Ark equivalent of Google AdWords, where users can pay to promote themselves, he said.

Riley wants to develop a reputation and validation tool that fingerprints a person by comparing their social graphs on different networks. Because many sites and apps improve with a better sense of who is using them, he plans to provide social-data plug-ins to other companies.

After being founded just last summer and coming into focus during the three-month YC program, Ark already has a team of 16 employees, including co-founder Yiming Liu, also from Berkeley’s iSchool. And now it has a bunch of money to hire more.

Please see the disclosure about Facebook in my ethics statement.

Transmitting personal data between applications doesn’t have to be for nefarious purposes. In fact, it’s often something that we users like and encourage — when we sign up for new services, we often volunteer our credentials from Facebook, Twitter, LinkedIn, Instagram and elsewhere.

Connecting these accounts means we don’t have to type in our personal information yet again in order to try some new thing; we can see which of our friends already use it, and we can cross-post our activities so we’re not constantly manually updating all these different networks.

You don’t have to try very hard to imagine why companies like this.

Singly offers this whole account-connection process as a service to developers, so they can get “merged, normalized and de-duplicated social data” aggregated together from at least 10 different APIs. This is similar to how developers might connect to Factual to get access to public datasets about places.

Singly is still in its very early stages; CEO Jason Cavnar told me that today just three applications are being built using Singly, and they are too young to name. But examples of apps that he thinks would benefit from Singly include any service that is built as an interface on top of existing information about users — like Mint, Flipboard, Showyou, Highlight, Sonar, Greplin, CloudMagic, Tungle, Nimble and Timehop.

Beyond social data, Singly is entertaining visions of connecting to credit card companies, utilities and other sources, all in the name of helping users dole out access to their personal data.

Singly started life as “The Locker Project” and attracted particular interest because co-founder Jeremie Miller founded the open source instant-messaging protocol Jabber. The company continues to open source its data-connection work, while offering it as a service to customers.

Early on, Singly had focused on hosting applications as well, but now it plans to be primarily an API provider, Cavnar said.

New Singly angel investors, along with Foundry Group, include Robert Stephens, the former CTO of Best Buy; Federated Media’s John Battelle; Esther Dyson; and Roger McNamee. Previous seed investors included Venrock, True Ventures, PivotNorth Capital (Tim Connors) and Freestyle Capital.

Now it has 25 million registered users, with 40 percent of new members joining from mobile and 50 percent of new users outside of the U.S.

If there’s one thing investors like, it’s hockey sticks. So Mayfield Fund, along with previous backers Accel, Norwest Venture Partners and Redpoint Ventures, has put $25 million into a Series C round for BranchOut, about a year after its last round of $18 million.

To be clear, San Francisco-based BranchOut doesn’t offer its own mobile apps — this is all on top of Facebook’s apps.

BranchOut has 13.1 million monthly active users, according to Facebook app-measurement source AppData.

BranchOut, which currently has 45 employees, said it plans to focus the new funding on expanding its team.

But there’s already a new site called CircleUp that falls somewhere in between Kickstarter and SecondMarket. CircleUp vets consumer product and retail start-ups with $1 million to $5 million in revenue that are looking to raise up to $1 million. It posts them on a portal that’s accessible only to accredited investors, using standardized forms and online verification so that equity investments can be completed quickly.

(After the JOBS Act crowdfunding protocol gets figured out, the site may open to unaccredited investors, its co-founders said. For now, it is operating as a broker dealer through a relationship with WR Hambrecht.)

CircleUp has raised $1.5 million of its own funding from investors including Maveron, Triple Point Ventures, Twitter’s Elad Gil and David Topper, the former head of Capital Markets at J.P. Morgan.

But CircleUp didn’t use its own platform to raise that money, because it doesn’t meet the criteria for investment, the founders told me. Why? First, it doesn’t have an established financial track record; and second, technology businesses are hard for consumer investors to evaluate. Talk about brutal honesty!

Path described the Series B funding as “more than $30M,” and said it also included Greylock Partners and Sir Richard Branson.

In the emailed statement, Path CEO Dave Morin noted the investors’ commitment to building Path “for the long term,” and said the funding would be used for “international growth and expansion as well as user adoption.”

Allow me to dissect this just a little bit. Morin described Path as a “mobile personal networking” start-up, while Redpoint’s Satish Dharmaraj called the app “a private mobile-focused social network.” Those descriptions diverge from when Path relaunched late last year as a “smart journal.” It’s subtle, but a tweak all the same.

Also, it’s noteworthy that Path explicitly said the money would go toward “user adoption.” Traditionally, social apps don’t like to talk much about spending money to acquire users.

Path said its Series B investors are: Greylock Partners (David Sze), Redpoint Ventures (Satish Dharmaraj), Jerry Murdock , Sir Richard Branson, Kleiner Perkins Caufield & Byers (Chi-Hua Chien), Index Ventures (Mike Volpi), Mark Pincus, Yuri Milner and Allen & Company.

This seems to be working for Chartbeat, a company that sells a low-cost, lightweight analytics system that lets Web publishers see how their content is performing in real time.

The New York-based company has more than 4,000 paying customers (AllThingsD is a user), and now it has a bunch of money to go find more, via a $9.5 million B round led by DFJ and Index Ventures.

Revenue? CEO Tony Haile says he’s been generating millions a year for “quite some time,” and while he won’t get more specific, he does say revenue was up 3.5x in the last year. Profits? “If I’m profitable, I’m not growing my team fast enough,” he says.

Alrighty. Chartbeat also has a zippy new interface with even more information porn than before — the new look seems directly inspired by the infographics that Web publishers have been chucking up with abandon for the past year or so, and I don’t think that’s a coincidence.

Which brings me back to the question I have every time I think about Chartbeat or any of the other analytics services available for Web publishers these days — what exactly are we supposed to do with all of this data?

Every time I write about Chartbeat, I end up having the same conversation with Haile, so this time I figured I’d just be more efficient and rerun the last interview I had with him, from back in January 2011.

And here, because I can — some Thomas Dolby:

(Happy Birthday, Jonah!)

]]> http://allthingsd.com/20120416/chartbeat-raises-9-million-for-more-real-time-web-publishing-analytics/feed/ 0 http://allthingsd.com/20120415/confirmed-redpoint-leads-40m-funding-round-for-path/ http://allthingsd.com/20120415/confirmed-redpoint-leads-40m-funding-round-for-path/#comments Mon, 16 Apr 2012 06:23:39 +0000 Liz Gannes http://allthingsd.com/?p=196583 Path, the mobile social networking start-up, is planning to announce it has raised Series B funding as early as tomorrow, according to sources.

Redpoint Ventures led the $40 million round, which values Path at $250 million.

Path CEO Dave Morin

That Path was fundraising was not a secret, and Business Insider had already reported that Redpoint would lead the round.

Path CEO Dave Morin said in February that the app had two million registered users. It was rejuvenated after a successful redesign late last year to become a personal journaling app, with ways to share travel, sleep, photos, locations and workouts through a Nike partnership.

Path is often mentioned as a buyout target, but Instagram is the app Facebook scooped up for $1 billion last week. Instagram, which is all about sharing photos, closed a $50 million round of funding just before it got bought that valued it at $500 million.

Path’s last funding was $8.65 million from $8.65 million from Kleiner Perkins Caufield & Byers, Index Ventures and Digital Garage Japan at the beginning of 2011.

Morin did not reply to requests for comment.

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