This morning, the New York-based company handed out pink slips to about 25 employees, or about 35 percent of its staff, according to a source familiar with the matter.

Lot18 will now employ 46, half as many as it did a year ago.

It is the second layoff in the past year for the startup, which started selling wine online in November 2010.

The first round was tied to the discontinuation of its travel and food businesses, which it had expanded into shortly before raising $30 million in venture capital in late 2011. Investors include Accel Partners, New Enterprise Associates and FirstMark Capital.

This time, the layoffs are connected to a shift in strategy. Rather than exclusively operate as a flash sales company, which sells bottles of wine at a discount to a free membership base, it will also try to sell wine through a subscription model.

The model is already well established by others in the industry, such as Global Wine Company, which runs the New York Times Wine Club, for instance, and Direct Wines, which operates a wine club for The Wall Street Journal.

The recurring revenue stream is far more predictable than getting members to return to the site and pay for single orders. As it stands right now, Lot18 is a marketplace, so it does not own any inventory or warehouses. Instead, the company’s headcount is a considerable expense, as are its marketing costs to get new members — just like other sites, including Groupon. In addition, it subsidizes shipping, since wine is so heavy and fragile.

According to a spokesperson, the new initiative is allowing the company to scale back on the time and attention that the flash sales business requires. However, not all employees will be let go immediately and Lot18 plans to do select hiring for the new business.

In a statement, CEO Jay Sung said: “The team we have — and many of the excellent people who left the company today — worked incredibly hard to make Lot18 strong, but we need to resource according to our new business model and operate the existing business more efficiently with considerably less burn.”

The cuts impacted all parts of the company’s business, including marketing, procurement and merchandising. Andrew Koch, the company’s VP of product, left the company recently, and we are hearing that Barbara Anderson, the company’s chief counsel, is leaving voluntarily. Lot18’s founder, Philip James, remains with the company and is leading the launch of the new subscription business.

In the fourth quarter, the company tested two new subscription services. Customers could either sign up to receive six bottles for $99 a month, or 12 bottles for $149 a month (the first month cost $49 and $79, respectively).

Since its launch, the current club has exceeded its growth targets, the spokesperson said. A new product launch will occur in early 2013.

The Library of Virginia

The payments company said the cash would go toward developing new payment capabilities and international expansion. In total, it has now raised $70 million in capital.

Braintree is not the only one after PayPal’s multibillion dollar business. Another start-up vying for a chunk of the business is San Francisco’s Stripe. The general claim by these newbies is that Stripe can provide a much more streamlined process for accepting payments for retailers and consumers — at least compared to the 14-year-old incumbent.

In the case of Braintree, it claims it is processing more than $5 billion in payments annually for more than 3,000 mobile and online merchants, including Uber, Fab, Airbnb and HotelTonight. It charges 2.9 percent plus 30 cents per transaction, and works in more than 30 countries and accepts 130-plus currencies. In a statement, NEA general partner Ravi Viswanathan said the investment reflects the firm’s confidence in the company’s technology: “We believe Braintree has the strengths to challenge all the incumbents in the payment space, including Paypal.”

Earlier this year, Braintree acquired mobile payments start-up Venmo for about $26 million to add another PayPal feature to its service: Digital wallet and person-to-person payment capabilities.

But don’t get the “With Buddies” games confused with Zynga’s “With Friends” franchise, which has such well-known hits as Words With Friends and Scramble With Friends.

Scopely was founded by AdSense co-creator Eytan Elbaz, Walter Driver and Ankur Bulsara, and has been operating in stealth mode since last year, an announcement that my colleague Liz Gannes teasingly wrote about here.

The caliber of the team shows how intense the mobile games race has become, and is precisely why Zynga will have a hard time dominating the top of the charts like it did on Facebook.

Investors in Scopely’s round include Anthem Venture Partners, The Chernin Group, Greycroft Venture Partners and New Enterprise Associates (NEA). Many other well-known angels also participated, including former Yahoo CEO Terry Semel and Buddy Media CEO Michael Lazerow.

Check out Scopely’s Web site to see its credentials in excruciating detail, or read the full release below:

Scopely Closes $8.5 Million in Seed Funding Led By Anthem Venture Partners

LOS ANGELES, CA – September 19, 2012 – Scopely, the mobile developer/publisher founded by AdSense Co-Creator Eytan Elbaz, Walter Driver and Ankur Bulsara, today announced $8.5 million in seed financing. The round includes primary investors Anthem Venture Partners, The Chernin Group, Greycroft Venture Partners and New Enterprise Associates (NEA).

Samit Varma of Anthem Venture Partners said, “We had been tracking the Scopely team for months so we were very interested when we had the opportunity to get involved.  As we dug in further, we were really compelled by their differentiated vision of the intersection between social, mobile and games. The team they’ve assembled and the traction they’ve seen to date is quite impressive.”

Other notable investors participating in the round include: former Yahoo CEO Terry Semel; ShoeDazzle and Honest Company founder Brian Lee; Buddy Media CEO Michael Lazerow; LiveRamp CEO/Rapleaf Chairman Auren Hoffman; Red Swan Ventures; Double M Capital Managing Partner Mark Mullen; Amplify Co-Founder/Accel Venture Partner Richard Wolpert; TechStars CEO David Cohen; TechStars NY Managing Director David Tisch; Burstly CEO Evan Rifkin, Sands Capital, Factual CEO Gil Elbaz and Aydin Senkut’s Felicis Ventures.

“We’re thrilled to be working with such a distinguished group of investors.  We are big proponents of the Los Angeles startup ecosystem so it’s great to have investors like Anthem, Greycroft and The Chernin Group who are based in LA and have unique expertise in the digital media space involved,” said Walter Driver, co-founder and CEO of Scopely.

Scopely has been operating in stealth mode since last year, quietly amassing an all-star team of 30 engineers, data scientists and product managers.  The company will use the additional capital to accelerate growth and expand its product offerings.

Scopely’s With Buddies franchise of multiplayer games has grown rapidly to millions of active users. Current With Buddies titles available in the AppStore include: Dice With Buddies and Jewels With Buddies.

About Scopely
Based in Los Angeles, California, Scopely develops and publishes mobile social applications including the With Buddies franchise of multiplayer games. Founded in 2011 by Eytan Elbaz (Applied Semantics, Google), Walter Driver (O Negative Media) and Ankur Bulsara (MySpace), the company has received $8.5 million in seed financing to date.  To learn more, please visit www.scopely.com.

The Pittsburgh-based company’s Series B round was led by New Enterprise Associates and included return backer Union Square Ventures.

If it works, Duolingo could be one of the best examples ever of a win-win scenario. The site teaches languages (English, Spanish, French, German and Portuguese, and soon Italian and Chinese) for free, and aims to use the combined power of those language learners to deliver fast and accurate translations for paying customers.

Duolingo now has 250,000 weekly active users, who visit the site for an average of half an hour per day. It’s about to start taking translation work in October, and is working on pilots with news organizations now.

The big questions are: Will Duolingo get language learners to stick around, and will people who have just learned a language be able to do professional-grade translations?

Von Ahn told me he thinks the answer to the first question is definitely yes, and the answer to the second question is preliminarily yes.

The earliest users of Duolingo, who have been on the site since March, are already testing at the equivalent proficiency of students who have taken four semesters of college language classes, von Ahn said. He has said his team is currently turning that pilot test into a full study.

In a document filed with the Securities and Exchange Commission today, the company said that the bulk of the proceeds will go toward working capital and other general corporate purposes.

Underwriters include Morgan Stanley, Allen & Co., Cowen and Co., Pacific Crest Securities, Canaccord Genuity, Wells Fargo Securities, JMP Securities, J.P. Morgan and Goldman Sachs & Co.

The seven-year-old company, which has 1,450 employees, says it has seen tremendous growth for its enterprise resource management software.

Over the past three years, the company’s revenue has skyrocketed, increasing 400 percent to $134.4 million. And in the first six months of 2012 it has already booked $119.5 million in revenues. However, the company has a history of losses. In the year ended Jan. 31, it lost $80 million. In the prior year (which is slightly different, because the company changed its fiscal calendar), Workday lost $56.2 million for the year ended Dec. 31, 2010.

As of July 31, Workday had cash and cash equivalents of $122.7 million.

The IPO filing comes a little later than originally expected. My colleague Arik Hesseldahl reported previously that the company had been on track for a late-summer or early fall road show, so that shares could debut between October and December, depending on how favorable market conditions were. Those events may now be pushed out a little further.

The biggest shareholders are the company’s co-CEOs, Aneel Bhusri and Dave Duffield, who own 19.3 percent and 53.4 percent of the company, respectively. Greylock Partners and New Enterprise Associates are the two largest VCs backing the company, owning 11 percent and 10 percent of shares, respectively.

As part of the deal, Gary Reiner — the former CIO of General Electric and an operating partner at GA, who’s also a director at Hewlett-Packard — will join Box’s board. Also joining the round as a new investor is the Social+Capital Partnership.

Sources familiar with the company’s efforts tell AllThingsD that there are at least two other institutional investors taking part in the round, but those firms are, for now, not being named, though they’ll be revealed in regulatory filings soon. In taking institutional investments, as part of a late-stage investment, Box is following a variant of the strategy that companies like Facebook and Workday have followed on the path to an initial public offering, which Box is considering for sometime in 2013.

The Wall Street Journal reported last week that Box was raising funds at an implied valuation of $1.2 billion, and sources familiar with the terms of the deal confirmed that such a valuation estimate is right on target.

The investment brings Box’s total capital raised so far to about $285 million. In fact it’s been less than a year since Box took an $81 million strategic investment round from Salesforce.com and SAP Ventures with several venture capital funds including New Enterprise Associates and Bessemer Venture Partners. Box has proven one of the more popular plays for venture capitalists in the last few years, and its roster of backers runs the gamut of Sand Hill Road’s bigger names: Andreessen Horowitz, Draper Fisher Jurvetson, Emergence Capital Partners, Meritech Capital Partners, Scale Venture Partners and US Venture Partners are all investors.

But ask Aaron Levie about an IPO, and he’s quick to demur. “We can do way more as a private company than we can as a public company,” he says. “Taking this round gives us the foundation to build the foundation we need.”

By VC standards, $125 million is a sizable deal, but Reiner told me it’s about an average-sized deal for General Atlantic. “We invest about $2 billion a year,” Reiner told me, “and do about a deal a month,” in sizes ranging from $50 million to $500 million, but averaging about $150 million each. The firm’s investments have included stakes in Alibaba Group, Facebook, Gilt Group, and ServiceSource.

And there’s no question that Box is growing. Just last month, it announced plans to expand into Europe, disclosed that it had hired Stefan Apitz away from LinkedIn as its VP of operations, and talked about a new data center in Las Vegas. And in March, it took its exploding batch of employees — now 500 strong — to new headquarters in Los Altos, Calif.

What’s interesting about Reiner leading this investment and taking a seat on Box’s board is the fact that he was for years the CIO at GE, and as such was once the very kind of person who you might have expected to be suspicious of the cloud’s value to large enterprises.

I asked him to put his old CIO hat back on for a moment and consider how he might have seen Box years ago. “The biggest concern a CIO has is about important documents being stored outside the firewall,” Reiner told me. “But the fact is that almost every large enterprise has been broken into, and every CIO has been humbled regarding how tought it is to secure your own environment. But the fear of trusting a cloud service is a lot less now than it was about four or five years ago.”

Rather than fight the constant losing battle to keep the bad guys out, better to let someone whose reputation depends on security develop a service specifically for sharing files across a company or with partners.

At GE, Reiner oversaw the building of an internally-built file sharing network that did a lot of the same things Box does, but without anywhere near as many features. “We couldn’t find someone to build it for us, so we built our own, and it quickly became critical to the heartbeat of the company,” he said. “It had a lot of the same functionality but its user experience was nothing like Box.”

I asked Reiner what he thinks about the timetable for a Box IPO. His answer: “Who knows? … All we want to do is help,” he told me. “The goal is to provide the best business guidance that we can.” There will be time to talk about IPOs sooner or later.

If you invested some of your money in the series of big, splashy IPOs that Silicon Valley has largely funded and churned out over the last year, you might be a little irritated.

Even irked. Possibly quite out of sorts.

And you would have good reason if you looked at the performance of many of the freshmen companies that have come out since early last summer.

That’s because of all of them, only three — business network LinkedIn, enterprise software start-up Jive and the recently debuted travel site Kayak — are your friends, up 9.8 percent since its May 27, 2011, debut; 26 percent since a December 15, 2011, opening; and about six percent since an IPO last week, respectively. In addition, video services company Brightcove is up a small 2.7 percent since its February 21, 2012, IPO.

Not so much for the other four, which have been much rockier, in order of their public offerings: music streaming site Pandora, down 29.6 percent since its June 24, 2011, IPO; Groupon, down 72.3 percent since the daily deals site’s November 7, 2011, IPO; Zynga, down 46.6 percent since its December 19, 2011, IPO; and Facebook, down almost 23 percent since its May 18, 2012, IPO.

But the stock weakness — as social networking giant Facebook preps to release its first earnings report as a public company tomorrow, after Zynga’s disastrous Q2 results from its online gaming business earlier today — does not seem to have stopped the frothy valuations for private start-ups from being even more foamy.

Along with a $2.6 billion new mega venture fund from New Enterprise Associates, comes a Wall Street Journal report that online storage company Box is raising a new round at a $1.2 billion valuation and hopes to IPO at a $2 billion to $3 billion one next year; and online payments start-up Square is looking at a $3.25 billion-valued round, according to the New York Times, which is 13.5 times higher than just two years ago.

Caveat: While there have been some good returns to private investors in the M&A space of late, such as social enterprise network Yammer’s recent $1.2 billion sale to Microsoft, not everyone is going to get such deals.

And definitely not public investors for whom hope either springs eternal — or just springs a leak.

It’s similar to building a house: Most of the component pieces are standardized and are used in predictable ways; some are tweaked a bit to function just a bit differently than originally; and some are custom-made to fit the taste and desire of the builder.

It’s certainly efficient, and saves the time and effort of recreating a block of code that gets the job done. But there can be a problem. Let’s say the home builder chooses a wonky model of dishwasher, but no one knows it’s wonky until its too late. The dishwasher can be swapped out for a better one. But what if there’s a problem in the parts used to build the foundations of the house?

A software developer can easily choose an open-source component that has some unknown security weaknesses, or which uses some code that is subject to a license. Or it simply might not be up to date, or the component might not be very good. And once it’s used, one block might turn out to be a linchpin to other critical bits of the application, so swapping it out can get complicated quickly.

Software developers need a little help in vetting and evaluating and managing all the software components they use. And a start-up called Sonatype is out to help them do it. It announced this morning that it has landed $25 million in funding in a round led by New Enterprise Associates, with existing investors Accel Partners, Hummer Winblad Venture Partners, Morgenthaler Ventures and Bay Partners all participating.

Sonatype runs something called the Central Repository, essentially a library of some 400,000 software components that is so widely used by software developers that it gets about five billion requests a year. That gives it a lot of visibility into what components are being used, and what potential problems might be cropping up. Simply keeping track of what software components were used to build an application goes a long way toward solving problems as they arise down the road, Sonatype CEO Wayne Jackson told me.

According to a study Sonatype commissioned in March, developers at the world’s 500 biggest companies downloaded 2.8 million components suffering from security problems last year. When you consider that 80 percent of software applications built are using these prebuilt components, you get an idea of the potential scale of the problem. Here’s another tidbit that, on its face, is kind of alarming: Firms in the financial services industry were the heaviest users of these insecure components, downloading some some 567,000 of them in one year. One user in three hadn’t downloaded the most up-to-date version of the component with known security problems fixed.

Sonatype’s approach to this problem comes in helping developers evaluate and manage the components they use. Its customers, which include Intuit, Cisco Systems, Skype and Hewlett-Packard, get a deep look at everything there is to know about a given component, so they can decided if it’s really the best bit of code for the job at hand. It has essentially created its own market niche, known as “component lifecycle management.”

As part of the investment, Harry Weller, a general partner at NEA, will join Sonatype’s board of directors. In a statement, he described the company as being “… In a prime position to become the must-have tool used by every development organization in the world.”

The round brings Sonatype’s total capital raised to $35 million about $41 million. It was founded in 2010 2008 by by Jason van Zyl, the creator of Apache Maven and the Central Repository.

Coming on the heels of yesterday’s record-setting $100 million Series A investment by Andreessen Horowitz in GitHub, it’s a pretty clear sign that software-development tools and infrastructure are where the VC money is flowing right now, and another sign of Marc Andreessen’s argument that software is “eating the world.” Think of GitHub as where open-source software is born. Sonatype’s Central Repository is where that software goes when its all grown up.

Accel Partners, Breyer Capital and Polaris Venture Partners became the newest partners in the seed-stage venture fund aimed at entrepreneurs in the Boston area.

The Experiment Fund, which already includes New Enterprise Associates, is “anchored” and was launched at Harvard University, although the famed school is not one of its funders.

New advisers were also added to the Experiment Fund, including former Harvard Law School professor and former director of the Berkman Center John Palfrey, Facebook co-founder Andrew McCollum, Massachusetts Institute of Technology researcher Hugo Liu, as well as an ex-officio post created for the current president of Harvard Student Agencies.

The fund, which AllThingsD wrote about previously, was created earlier this year by the dean of the Harvard School of Engineering.

The early-stage incubator planned then to award funding to four to six start-ups, in amounts from $250,000 to $500,000, focused on the Cambridge, Mass., area around Harvard, which includes many other schools such as MIT.

The point has been to foster innovation around the Boston area, rather than watch those start-ups head west to seek funding. In other words, to keep the next Facebook — which was born there — from moving away to Silicon Valley.

In other words: Stay east, next young Mark Zuckerberg!

The new partners are contributing more funds, although they declined to specify the amount. Breyer Capital is the personal investment company of Accel’s Jim Breyer.

As part of adding the new partners, Breyer and Polaris’ Alan Crane will become “experts-in-residence” at the Harvard School of Engineering and Applied Sciences. Breyer and Crane, by the way, both got their MBAs from Harvard.

Aneel Bhusri

The latest hints on timing come in the form of an extensive interview in Bloomberg Businessweek (the magazine I used to work for) with co-CEOs Aneel Bhusri (pictured) and Dave Duffield. Both are veterans of PeopleSoft, the HR software company that Oracle acquired in a $10.3 billion hostile takeover in 2004. The magazine says that Workday could file its S-1 with the U.S. Securities and Exchange Commission as soon as this month.

That jibes more or less with what AllThingsD reported last month when Workday selected the bankers that will shepherd it through the IPO process: Morgan Stanley, Goldman Sachs, Allen & Company and J.P. Morgan Chase. The process began in earnest after Workday hired away former VMware CFO Mark Peek.

Workdays plans still call for a fall road show, and then for the shares to debut in October or December, depending on market conditions.

The interview is rather interesting. When Fortune Magazine profiled the Workday founders in March, it portrayed the company as a means for Duffield and Bhusri to exact some revenge on Oracle CEO Larry Ellison. In Bloomberg Businessweek, Duffield all but thanks Ellison for the takeover drama:

“You have to bless Larry’s heart for giving us this opportunity. I would never have been part of this Workday thing without Larry.”

Ellison sure didn’t mince words when the subject turned to Workday during his appearance at D: All Things Digital on May 30. Asked during the Q&A session about Workday, Ellison sought to take Workday to the woodshed:

“It’s going to be very interesting to monitor Workday. We monitor Workday, and we beat Workday all the time.”

He then went on to accuse Workday of not using a database and using a Flash interface, making it useless on an iPhone or iPad. That prompted Bhusri to respond via Twitter:

Larry is super entertaining. But, we run on #iPads, support HTML5 and use MySQL as a database:-). @Workday #atd10

May 30, 2012 5:13 pm via Twitter for iPhoneReplyRetweetFavorite

@aneelb

aneel bhusri

What else do we learn about Workday? It’s apparently on track to break $500 million in bookings — essentially the combined value of multiyear contracts — this year. That’s in line with the $320 million in 2011 bookings Bhusri told me he expected in October of that year.

No wonder that Workday has raised a combined $250 million in capital since Duffield and Bhusri started it up in 2005. The last was an $85 million institutional round that valued Workday at $2 billion.

That round included T. Rowe Price, Morgan Stanley Investment Management, Janus, and Bezos Expeditions, the personal investment entity of Amazon CEO and founder Jeff Bezos. William Danoff, the manager of Fidelity’s $80 billion Contrafund, the mutual fund giant’s largest stock-based fund, also participated in that round. Other investors include Greylock Partners, where Bhusri is still a partner, and New Enterprise Associates.

Aneel Bhusri

Sources familiar with the company’s plans tell AllThingsD that Workday has chosen the four bankers that will lead it through the IPO process: Morgan Stanley, Goldman Sachs, Allen & Company and JPMorgan Chase & Co. The search for bankers caps a process begun in December.

The company’s IPO path calls for an S-1 filing to be made with the Securities and Exchange Commission by mid-July. After a late summer or early fall road show, its shares would debut between October and December, depending on how favorable market conditions are, sources familiar with the matter tell me.

The process began in earnest after Workday hired its new CFO, Mark Peek, away from VMware, where he was also CFO.

Workday is feeling emboldened in part by the successful offerings of Jive Software and Splunk, both enterprise companies with their hands in the cloud business. Workday itself is a pure cloud software play, specializing in human resources applications, a white-hot area of enterprise that has seen a lot of M&A activity of late.

In December, software concern SAP spent $3.4 billion to acquire SuccessFactors. Then, in February, software giant Oracle spent $1.9 billion to acquire Taleo, in a deal that took place shortly after I interviewed Taleo’s CEO. Even Salesforce got into the act, acquiring the start-up Rypple for an undisclosed amount in December.

Much of that dealmaking came in response to concerns about Workday, especially after its impressive $85 million Series F round of institutional funding at a $2 billion valuation, which AllThingsD reported exclusively in October. A Bloomberg News report said that round was oversubscribed and grew to $100 million when Michael Dell’s MSD Ventures joined.

Investors in that round included several who also took part in institutional rounds in Facebook and Web gaming player Zynga: T. Rowe Price, Morgan Stanley Investment Management, Janus, and Bezos Expeditions, the personal investment entity of Amazon CEO and founder Jeff Bezos. William Danoff, the manager of Fidelity’s $80 billion Contrafund, the mutual fund giant’s largest stock-based fund, also participated in that round.

A Workday IPO, which would raise about $500 million, would make for a sweet payday for the company’s earlier investors, which include Dave Duffield and Greylock Partners, who invested $90 million in four rounds, and New Enterprise Associates, which joined a $75 million Series E round in 2009. By my math, Workday’s total capital raised comes to a cool $195 million.

So how’s business? With the company having disclosed $160 million in billings total bookings in 2010, sources familiar with its operations tell me bookings in 2011 exceeded 100 percent growth. That would be above the $320 million in 2011 bookings CEO Aneel Bhusri told me he expected last October.

Workday is essentially the creation of PeopleSoft vets Bhusri and Duffield. They started the company in 2005, not long after losing a pitched battle to resist a $10 billion hostile takeover by Oracle. Bhusri and Duffield concluded that the next battlefield for enterprise software would be in the cloud. They kickstarted Workday using their own money and some funding from Greylock, and brought some PeopleSoft employees with them.

The idea was to re-create PeopleSoft, which makes software that businesses need to run day to day, but to deliver it from the cloud.

And unlike other cloud players that approach smaller companies and work their way up to ever-larger customers, Workday’s customers are already in the big leagues. The average Workday customer — there are 280 — has between 10,000 and 15,000 employees. The biggest is Flextronics, the huge electronics manufacturing company, which has 200,000 employees. Other customers include Time Warner, Thomson Reuters, Chiquita Brands and Salesforce.com. There are Workday records on more than two million employees on its system. All that after only four-plus years of active selling. A second, newer line of financial applications aimed at helping companies more efficiently manage their spending is getting traction, too.

Workday will probably be the biggest among a pending batch of enterprise-oriented IPOs set for summer and fall after the Facebook madness is over. For one, there’s Violin Memory, which I’ve been reporting on quite a bit. And Reuters is reporting that cloud storage and collaboration concern Box is looking like it’s eyeing an IPO in 2013. The bankers are going to be busy.

In a securities filing on Wednesday, NEA said it is planning to raise up to $2.56 billion, boosting an original $2.3 billion target from March.

Read the rest of this post on the original site »

But there’s no denying the attraction of services like Amazon Web Services or Joyent or Rackspace, where you can spin up and configure a new virtual machine within minutes of figuring out that you need it. So, many companies seek to approximate the experience they would get from a public cloud provider on their own internal infrastructure.

It turns out that a start-up I had never heard of before this week is the most widely deployed platform for running these “private clouds,” and it’s not a bad business. Eucalyptus Systems essentially enables the same functionality on your own servers that you would expect from a cloud provider.

Eucalyptus said today that it has raised a $30 million Series C round of venture capital funding led by Institutional Venture Partners. Steve Harrick, general partner at IVP, will join the Eucalyptus board. Existing investors, including Benchmark Capital, BV Capital and New Enterprise Associates, are also in on the round. The funding brings Eucalyptus’ total capital raised to north of $50 million.

The company has an impressive roster of customers: Sony, Intercontinental Hotels, Raytheon, and the athletic-apparel group Puma. There are also several government customers, including the U.S. Food and Drug Administration, NASA, the U.S. Department of Agriculture and the Department of Defense.

In March, Eucalyptus signed a deal with Amazon to allow customers of both to migrate their workloads between the private and public environments. The point here is to give companies the flexibility they need to run their computing workloads in a mixed environment, or move them back and forth as needed. They could also operate them in tandem.

Key to this is a provision of the deal with Amazon that gives Eucalyptus access to Amazon’s APIs. What that means is that you can run processes on your own servers that are fully compatible with Amazon’s Simple Storage Service (S3), or its Elastic Compute cloud, known as EC2. “We’ve removed all the hurdles that might have been in the way of moving workloads,” Eucalyptus CEO Marten Mickos told me. The company has similar deals in place with Wipro Infotech in India and CETC32 in China.

But there’s another alternative, called SugarCRM, that has been gaining traction, and which positions itself as an alternative to Salesforce. It’s open source, runs both in the cloud and on-premise, and it has a million end users at 7,000 companies in 192 countries.

Today, SugarCRM announced that it had raised $33 million in equity and debt financing. New Enterprise Associates led the round, and Brooke Seawell, an NEA partner, joined Sugar’s board. Silicon Valley Bank and Gold Hill Capital joined as new investors, while prior investors Draper Fisher Jurvetson and Walden International also participated.

The company saw sales increase by 67 percent last year and added 2,700 new customer companies, making SugarCRM, by its count, the third-most popular CRM product in the world.

In an unusual gift, Helen Gurley Brown has given Columbia University’s Graduate School of Journalism and Stanford University’s School of Engineering $30 million to create a bi-coastal Institute of Media Innovation.

Said the schools in a joint press release about the David and Helen Gurley Brown Institute for Media Innovation, “it is designed to encourage and support new endeavors with the potential to inform and entertain in transformative ways. It will recognize the increasingly important connection between journalism and technology, bringing the best from the East and West Coasts.”

Each university will get $12 million, with the additional $6 million to build a “state-of-the-art, high-tech newsroom” at Columbia’s famous J-School in upper Manhattan in New York.

(Full disclosure: I went to graduate school there, but we used typewriters way back then.)

Among the advisors to the project is well-known Silicon Valley exec Bill Campbell.

The move will be interesting as a collaborative venture between the East and West coasts, although it is unclear what it might yield.

Interestingly, last week, Harvard University announced an on-campus venture fund with New Enterprise Associates to better compete with the enticements of California.

Great content needs useable technology. Sharing a language is where the magic happens,” said Gurley Brown in a statement. “It’s time for two great American institutions on the East and West Coasts to build a bridge.”

Here’s the official press release on the Brown gift:

COLUMBIA JOURNALISM SCHOOL AND STANFORD SCHOOL OF ENGINEERING ANNOUNCE JOINT $30 MILLION GIFT FROM DAVID AND HELEN GURLEY BROWN

Gift Establishes First of Its Kind Bi-Coastal Institute for Media Innovation — Bringing Together the Best in West Coast Technology with East Coast Content

NEW YORK and PALO ALTO, Calif., January 30, 2012, 1:00 p.m. ET – Columbia University’s Graduate School of Journalism and Stanford University’s School of Engineering today announced a $30 million gift from longtime Cosmopolitan magazine editor and author Helen Gurley Brown to establish the David and Helen Gurley Brown Institute for Media Innovation.

The Institute and the collaboration between the two schools is groundbreaking in that it is designed to encourage and support new endeavors with the potential to inform and entertain in transformative ways. It will recognize the increasingly important connection between journalism and technology, bringing the best from the East and West Coasts.

The Institute, the first of its kind, is inspired by the memory of Ms. Brown’s late husband, David Brown, a graduate of both Stanford University and the Columbia School of Journalism. Brown, who along with partners Richard Zanuck and Steven Spielberg created such classic American films as Driving Miss Daisy, The Verdict and Jaws, was also a former journalist, publisher and, late in his career, a stage producer whose credits included the musicals Sweet Smell of Success and Dirty Rotten Scoundrels.

Of the total gift, each school will receive $12 million for Institute activities. The gift to Columbia’s Journalism School, the largest in its history, will endow a professorship whose holder will be the Institute’s East Coast director. The gift to Stanford’s Engineering School will similarly endow the position of the West Coast director. An additional $6 million will go to Columbia which will also pay for the construction of a highly visible signature space at the eastern end of the J-School’s landmark building, featuring a state-of-the-art high-tech newsroom.

The funding of the Institute will support graduate and postgraduate fellowships, both at Stanford and Columbia, and competitively awarded “Magic Grants,” intended to seed the most innovative and promising ideas for future development conceived of by Brown Fellows.

Commenting on the announcement, Helen Gurley Brown said, “David and I have long supported and encouraged bright young people to follow their passions and to create original content. Great content needs useable technology. Sharing a language is where the magic happens. It’s time for two great American institutions on the East and West Coasts to build a bridge.”

The east-west collaboration of the two schools will enable students at both institutions to build upon their ideas with professors and innovators at both universities. At both locations there will be a strong emphasis on executing new ideas and demonstrating products and prototypes. The
Institute will establish ongoing links to business leaders and media companies to bring its innovations to market.

“New York City, as the major center for the television, music, print media and advertising, is profoundly affected by rapidly evolving digital technology,” said Stanford engineering professor Bernd Girod, who will serve as the Institute’s founding director until Columbia appoints his East Coast counterpart. “The Brown Institute will bring together creative innovators skilled in production and delivery of news and entertainment with the entrepreneurial researchers at Stanford working in multimedia technology.”

“This gift from David and Helen Gurley Brown is truly transformative for the school,” said Nicholas Lemann, Dean of the Graduate School of Journalism at Columbia University. “As we enter our Centennial year, the Browns’ generosity will enable us to explore new and exciting realms of leadership in our field. We are thrilled to have this opportunity to collaborate with Stanford Engineering.”

“Stanford brings to this partnership its exceptional research and teaching, a history of transformative technology innovation and a tradition of multidisciplinary collaboration,” said Stanford University President John Hennessy. “We are excited about the opportunity to partner with Columbia University’s truly outstanding School of Journalism, and look forward to combining the expertise of New York and Silicon Valley at a critical point in the evolution of media.”

Stanford Engineering has a storied history of achievement and entrepreneurship. Its faculty and graduates have founded such iconic companies as Google, Hewlett-Packard, Cisco Systems and Yahoo! and contributed to such groundbreaking technologies as lasers, global positioning, magnetic resonance imaging, digital sound synthesis and modern web-search algorithms.

“Under Dean Nick Lemann, Columbia Journalism School is building on its tradition of leadership by developing innovative teaching and research addressing the future of a fast-changing news media,” said Columbia President Lee C. Bollinger, a First Amendment scholar who has written extensively about press freedom. “We are deeply appreciative of Helen Gurley Brown’s vision in honoring her late husband by bringing together his two alma maters to develop the next generation of digital journalism. We look forward to working with Stanford in seeking new ways for technology and creativity to enhance a robust free press in our society.”

The Institute will have a distinguished board of advisors including leaders from technology, venture capital and media including, among others, Frank A. Bennack, Jr., CEO of Hearst Corporation; Bill Campbell, Chairman of the Board at Intuit and an Apple Inc. board member; and Eve Burton, Vice President and General Counsel of Hearst Corporation.

Helen Gurley Brown, who turns 90 in February, is one of the world’s most popular and influential editors. She led Cosmopolitan magazine from 1965 to 1996 and authored many books, including the 1962 bestseller, Sex and the Single Girl. Her impact on popular culture and society has reached around the globe, largely due to the three-plus decades when she put her personal stamp on Cosmopolitan in a way that has rarely been replicated. Under her reign, Cosmopolitan became the go-to magazine for women worldwide and remains the best selling young women’s magazine around the world today with 64 editions, in 35 languages and more than 80 countries.

“As both CEO of Hearst Corporation and advisor to the Brown Institute, today marks a very special day for education, journalism and technology,” said Bennack. “I’m very proud of David’s legacy and Helen, who understood the power of community, in particular, and its importance to women, long before social media had a name.”

(Photo credit: Hearst Corp.)