AllThingsD » telephony

Twilio Taps Say Media Vet Kirkpatrick as CFO

Arik Hesseldahl — Mon, 14 May 2012 12:00:37 +0000

Something is going on at the telephony software start-up Twilio, and I guess the word to use is “growth.”

Barely two weeks after hiring former Jive exec Lynda Smith as its chief marketing officer, today it will announce that it has a new CFO. It’s Lee Kirkpatrick, and he’s leaving Say Media, where he had the same title. He started his new job on May 7.

Twilio is growing so fast that it’s a little hard to keep track of all the news coming out of it. In his new role, Kirkpatrick will be responsible for Twilio’s finances and worldwide strategy. The company recently added Belgium, Finland, the Netherlands and Sweden to the steadily growing stable of countries where it is operating. It also recently struck a deal with Microsoft to add telephony features to its Azure cloud computing platform, so, yeah, maybe now might be the time to add a CFO.

What’s Job One? Well, here’s a funny tradition at Twilio: Every employee, no matter their level or level of technical ability, is required to build a Twilio application in order to become familiar with how the service works. So, part of this week will be devoted to that. Companies like eBay unit StubHub, Salesforce.com and Airbnb have used it to create some custom apps that include the use of a phone.

It’s a very Twilio sort of thing to do. When the company was in the process of raising its most recent funding round — a $17 million series C led by Bessemer Venture Partners and Union Square Ventures — Bessemer partner Byron Deeter created a Twilio-connected number and asked CEO Jeff Lawson to call it. As VentureBeat reported at the time, when Lawson called, he heard an automated voice message asking him to press 1 for $5 million, press 2 for $10 million and press 3 for $15 million.

It turned out that C round topped out at $17 million late last year, bringing its total capital raised to about $34 million, so there’s a decent-sized pile of money to look after. Before Say Media, Kirkpatrick held executive jobs at Ofoto, the Kodak Gallery and Reuters.

Silver Lake Grabs Large Minority Stake of WME to Push Digital Initiatives

Kara Swisher — Wed, 02 May 2012 17:59:41 +0000

Large private equity firm Silver Lake is buying a large stake in powerful Hollywood talent agency William Morris Endeavor Entertainment, which is being described as a way to turbocharge its digital efforts.

While the pair would not disclose any financial details of the deal, which they are calling a “strategic partnership,” sources said Silver Lake is acquiring 31 percent of WME.

“Over the years, we have been brick-building, as we have been doing more and more digitally,” said Patrick Whitesell, co-CEO of WME with Ari Emanuel, in an interview today. “But the opportunities are so vast, there is a need for more capital to do more.”

Whitesell and Emanuel said they had been considering a range of investors, especially among media entities, but that they wanted to work with Silver Lake since it had more digital experience as an active investor in technology.

Skype, for example, was the driver of the sale of Internet telephony giant Skype to Microsoft for $8.5 billion, while WME reps stars such as Matt Damon and Hugh Jackman, among others.

“In addition to capital, we really wanted a partner that to help us build it out that had more technology expertise,” said Emanuel. “We are good with brands and creative and talent, but there are many more Silicon Valley opportunities.”

In fact, WME has long tried to up its digital portfolio to respond to the needs of its clients and the changing nature of entertainment distribution as consumer Internet use has exploded. That’s included a digital advertising effort, as well as one in online gaming.

Silver Lake, which has most recently looked at investing in Yahoo, it was a chance to get closer to a trove of premium entertainment content.

“You have two forces at play, ubiquitous distribution and four billion people connected,” said Silver Lake’s Egon Durban. “As that distribution has been commoditized, the only way to differentiate is through A-plus content.”

Along with the core investment, WME and Silver Lake said they will also be considering other possible deals together as they move forward.

“There is nothing we like more than handing our best partners more money,” said Durban, who will join WME executive committee and also help create a technology advisory counsel at the firm.

Calling Marc Andreessen! Actually, in an interesting factoid, it was the well-known tech investor and entrepreneur who introduced Durban to Emanuel.

But this movie has been shown before and is not the first Hollywood-tech hookup to happen. A variety of efforts have waxed and waned over the years — most of which have largely been underwhelming.

Last year, for example, Accel Partners invested $40 million in Legendary Pictures and, back in 2008, Accel, the then William Morris Agency and AT&T formed an investment consortium to focus on Southern California start-ups.

Most closely related was the 2010 deal, in which TPG Capital took a 35 percent stake in Creative Artists Agency.

Here is the official press release on the Silver Lake-WME deal:

WME Press Release_5 02 12_FINAL

Cloud-Based Phone Software Start-Up Twilio Taps Former Jive Exec as Its CMO

Arik Hesseldahl — Fri, 27 Apr 2012 12:30:54 +0000

There’s a certain kind of geek who gets excited about Twilio. Who among software developers wouldn’t jump at the chance of adding voice-calling and text-messaging options to a public-facing application? Companies like eBay unit StubHub, Salesforce.com and Airbnb have used it to create some custom apps that include the use of a phone.

This creates curious opportunities for fun. When Twilio was in the process of raising its most recent funding round — a $17 million series C led by Bessemer Venture Partners and Union Square Ventures — Bessemer partner Byron Deeter created a Twilio-connected number and asked CEO Jeff Lawson to call it. As recounted by VentureBeat, when Lawson called, he heard automated voice messages asking him to press 1 for $5 million, 2 for $10 million and 3 for $15 million.

Hijinks like this say a lot about the culture that surrounds Twilio, but it’s not well known outside the developer community. Addressing that will be job one for Lynda Smith, its new chief marketing officer, who joined the company on April 23.

Smith is joining Twilio from Jive, the social enterprise software concern, where she was senior vice president of marketing until last fall. As CMO, she’ll be responsible for Twilio’s marketing strategy around the world.

“I think the Twilio brand is huge among developers because it gives that community a chance to play with something they haven’t had before,” Smith told me. “But it’s also getting a lot of traction within the telephony industry. … Voice and messaging are still a big part of the worlds that we live in, but they’ve been difficult to bring into new-world software applications because it’s still tied to some old-world things like hardware and protocols.” First priority, she says, is making sure that people outside the developer world know what Twilio is and what they can do with it.

Before Jive, Smith held a number executive slots at Genpact, Nuance, Genesys and Lockheed Martin. She’s a graduate of Simpson College, and has an MBA from the University of Pennsylvania’s Wharton Business School. She’s also on the faculty at Stanford University, where she lectures on global entrepreneurial marketing.

Twilio is definitely on the move: It landed $17 million in that C round late last year, bringing its total capital raised to about $34 million. It also just announced its second conference in San Francisco, in October. Time to get serious about marketing.

Twilio Nabs $17 Million More in Funding From Current Investors

Ina Fried — Wed, 07 Dec 2011 12:30:55 +0000

Twilio, whose technology lets developers build telephony and messaging into their apps, announced Wednesday that it has raised $17 million from Bessemer Venture Partners and Union Square Ventures — two of its existing investors. The San Francisco-based company, which has around 100 employees, plans to use the money to help fuel continued hiring and international expansion.

Fetchnotes Wants to Get Your "To Do" List Out of Your Head

Drake Martinet — Sat, 05 Nov 2011 17:00:30 +0000

You’re walking around out in the world and an idea strikes you. How do you best trap that random neuron and save it for later?

Fetchnotes, a small start-up out of Ann Arbor, Mich., is hoping to be your answer to those pesky, brain-leaking notes.

The service, still in closed beta, is pretty simple thus far. Basically, users register for an account and then are allowed to text a note to a special phone number.

The notes are saved on the Fetchnotes Web app, where they can be “auto-organized at the point of capture,” said Fetchnotes co-founder Alex Schiff.

The notes are arranged based on hashtags inserted in the notes themselves, and will eventually be automatically available for sharing using Twitterlike @ symbols.

But, according to Schiff, tomorrow’s Fetchnotes will look a lot different than today’s.

“We’ve only built in about 10 percent of the functionality we want,” he said. “The goal is to be able to get notes into Fetchnotes any way you want.”

Next, he said, the start-up will add the ability to call in notes, instant-message them via tools such as Google Chat, and link notes with dates in them right into Google Calendar.

It’s a pretty ambitious road map for a bootstrapped start-up outside Silicon Valley — although less so, when you consider that all of the things Fetchnotes hopes to loop together are really just hooks into everyone else’s APIs.

When I asked about competitors in the space — and there are a lot — Schiff was quick to address the elephant in the room: Evernote, which currently dominates the mobile memory space.

Schiff said that while Evernote wants to be your digital memory, Fetchnotes wants to be how you commit things to memory.

“In Evernote, it takes 12 steps to add a note with a tag on their mobile apps,” said Schiff. “That’s too much for short things.”

Fetchnotes came out of a collaboration between Schiff and Chase Lee — both juniors at the University of Michigan’s start-up incubator, called TechArb.

The team is now nearly 10, and Schiff said the company isn’t yet interested in taking money, although it has been approached.

The big question about these sorts of memory-helpers has to do with the battle between native tools and the cross-platformers.

Apple recently added the Reminders app, with its iOS 5 release, to the creatively-named Notes app that has shipped with every iPhone since the start.

Clearly, there is some mindshare they are after — enough to warrant the famously target-specific Apple building another OEM app.

The other side of this niche market includes services like Evernote, which try to be as cross-platform as possible, and collect everything into the cloud, where, theoretically, it will be safe.

Schiff’s company comes down in the Evernote camp, but he said he sees his real competition as “native apps like Notes, and more ‘lifehack’ stuff, like emailing yourself.”

I will add that the API-powered note-taking idea isn’t a new one. In fact, it’s nearly a demo product for what is possible with Internet telephony-based APIs. In fact, Fetchnotes is currently powered by an Internet telephony-via-API service.

Schiff and Fetchnotes may not be the only way forward, but light, fast, feature-oriented companies like his make a compelling argument for competing with the big boys by adding even more ease of use.

Here is a video I did with the Fetchnotes team:

[ See post to watch video ]

Yahoo Shares Melt as Rumors Collide (Plus, I Add Another Log to the Fire)

Kara Swisher — Tue, 01 Nov 2011 00:13:03 +0000

Do sale rumors make a troubled asset more attractive? Yes — except when more rumors (that those sales rumors might not be true) appear.

Welcome to just another day in the life of Yahoo, which saw its shares drop more than 5.5 percent today. Its stock declined almost a dollar to close at $15.64, after it was reported by various news orgs that Yahoo might be leaning toward no sale and a shareholder dividend, and toward taking control of its own sale of its lucrative Asian assets.

That was counter to the news — from a number of the very same outlets — touting a variety of ever more elaborate and sometimes breathless sale scenarios last week, featuring various configurations of Microsoft, Google and private equity firms like Silver Lake and others.

Silver Lake, in fact, appears to be the most aggressive in the possible bidding for all or parts of Yahoo, and has been noodling such a deal most intently, and for a long time now.

It makes sense, given that Silver Lake was successful in a vaguely similar deal that ultimately saved the Internet telephony service Skype, which it eventually peddled at a high price to Microsoft.

In fact, according to several sources, Yahoo director and co-founder Jerry Yang — also a former CEO of the company, who appears to have seized the ball firmly in the strategy game — met with Silver Lake today for an unspecified little chitchat.

That said, one source told me, “what is deeply uncertain is whether Silver Lake will do something at all.”

This is par for the course in this everything-but-the-kitchen-sink drama. Because — although it makes for a boring post, and the back and forth throat-clearing before an actual event might be entertaining — so far, not very much is actually happening as yet at Yahoo, with regard to its variety of options.

Of course, this could change in an hour. Or tomorrow, or the next day. Most of all, it’s clear that Yahoo’s board has to move in some significant way before the end of the year.

So, yes, the Silicon Valley Internet giant is doing all the sales-oriented stuff it should do with its coterie of pricey bankers (presumably being paid by the hour).

Yes, it has recently hired a talent-search firm, which is eyeing the landscape to find a willing CEO. (Even more adviser costs!)

And, yes, it is still wrangling with its Asian partners — Alibaba Group and SoftBank — over how to do a tax-free transaction (you’d think from all the sweating over it that this deal was harder to solve than the European debt crisis).

And, on schedule, activist shareholders — like hedge-fund agitator Dan Loeb of Third Point — should be attacking again soon, until a deal is done.

But according to many sources both inside and outside Yahoo, what’s happening is pretty much business as usual for this Hamlet of a company, which is lugubriously debating and weighing and pondering its fate.

I suppose it should, given the importance of it all, except it is a conundrum that has been going on for far too long at Yahoo, and under a number of different leaders.

In other words, it’s like “As the World Turns,” except with some new characters and a whole lot more amnesia.

But the slowness of a very real process is also causing deep frustration with all those dealing with Yahoo now — including possible bidders, and definitely its Asian partners.

Their gripes — which are louder than in most deals — are not surprising: They refuse to sign a too-onerous NDA to look at Yahoo’s books; there’s an irksome tone of indecision on the part of the company’s board; and, as always, the incessant leaks about all of this and more are making it worse.

One bidder has likened the company to a “melting iceberg that has a lot less time than the planet has to put its house in order.”

Another bemoaned the variety of trial balloons being floated, and noted that no movement was what Yahoo seems to do best.

That’s not exactly true, of course, so expect to see more leaks about plots and plans and meetings.

But no matter what you hear, keep in mind that having Yahoo’s fate being spun about like a top on a daily basis on Wall Street and in the media is not good for the company itself — or for its employees and shareholders.

Since it makes me dizzy — even though I like a good scoop as much as the next reporter — that’s the reason I have largely stuck to reporting about the actual internal turmoil inside Yahoo, from poor employee morale to various staff rejiggerings to more relentless brain drain.

Because while everyone fiddles, Yahoo’s real prospects of maintaining its core business melt a little bit more every day.

Yahoo is on its third CEO in four years, it has lost advertising momentum to Google and Facebook, its engagement levels are dangerously slowing, its social and mobile strategies are unclear and even its powerful email product is under siege.

And in the end, it is only these things that will matter to whoever runs the company in the end.

[Photo from Mat Honan's fantastic tweet here.]

Exclusive: Skype Employees Were Briefed in Plain English -- The Internal Equity Incentive Plan Deck

Kara Swisher — Tue, 28 Jun 2011 20:14:21 +0000

I have largely stayed away from opining about the he-said-he-said over what or what not Skype employees were told about the treatment of their stock options.

Some employees are alleging they were duped via complicated legalese and double-talk in employment contracts about how their shares would be handled upon termination or voluntary departure from the Internet telephony giant.

That matters, since Skype was recently sold to Microsoft for $8.5 billion, well above previous valuations. Thus, those who were, as a Skype PR person said, not in it to win it, um, lost.

Dramatic stuff, to be sure. But, even with all the fervor around the employment contract issue, the handwringing about what it means for compensation issues in Silicon Valley and a whole big dose of how private equity companies (in this case, a firm that had bought Skype called Silver Lake) are evil, it’s struck me as little more than an insider read-the-legally-obtuse-contract dispute.

And, although I love Reuters’ Felix Salmon’s epic tsk-tsking posts, that’s why I like to see real documents as proof of what people knew and when.

Apparently, a lot and rather clearly from this PowerPoint that was given to employees of Skype as of December 2009 as part of its changing ownership, after Silver Lake and other investors bought it from eBay.

While it’s not proof of what employees got it — typically, it is standard HR policy to hand this stuff out to everyone — and who read it (no accounting for slaggards!), it is pretty clear on what happens upon leaving Skype, either by a firing or quitting.

On the eighth slide, as you can see above, it says, in part:

“Good Leaver”: someone who gets fired without “Cause”

* Gets the fair-market value of their currently vested options

“Bad Leaver”: someone who resigns, or is fired for “Cause”

* Skype buys back their options at the lower of fair-market value or strike price

* This provision lapses post-IPO

It seems pretty buyer-beware clear, but check it out for yourself:

Skype – Employee Presentation

Confirmed: Microsoft Will Announce Acquisition of Skype Tomorrow Morning

Kara Swisher — Tue, 10 May 2011 03:14:16 +0000

The Wall Street Journal reported earlier tonight that Microsoft–in what would be its most aggressive acquisition in the digital space–was zeroing in on buying Skype for $8.5 billion all in with an assumption of the Luxembourg-based company’s debt.

Sources told BoomTown tonight that the deal for the online telephony and video communications giant is actually done and will be announced early tomorrow morning.

The purchase–which has been spearheaded in closely held negotiations by Microsoft CEO Steve Ballmer, with an assist from Business Division CFO Amy Hood and top dealmaker Charles Songhurst–is a bold move for the software giant and its biggest acquisition in more than three decades.

The big price will give Microsoft–which has struggled in its online efforts and has lost billions of dollars for its work–a big brand name on the Web.

With Skype, which has been aggressively expanding, Microsoft will continue to lose money in its Internet efforts. Skype lost $7 million on revenue of $860 million. Operating profits, which Skype preferred to highlight, were $264 million.

And–let us not forget–Skype’s debt is $686 million. Silver lining: That’s slightly less than Microsoft’s Online Services division losses in its most recent quarter!

But, sources said, the concept is bigger than just money, including getting access to Skype’s 663 million registered users.

Skype, which had been headed bumpily toward an IPO until now, will apparently be integrated into Microsoft’s Windows Live and other online communications efforts in both the consumer and enterprise arenas, sources said.

Think Kinect connecting.

Skype has had a big-company owner before–eBay Inc. paid $2.6 billion in cash and stock for it in 2005, as a way for the auction site’s buyers and sellers to communicate.

A 70 percent stake in Skype was sold in 2009 to investors such as Silver Lake Partners, Andreessen Horowitz, and the Canada Pension Plan Investment Board. It then valued Skype at $2.75 billion.

So, obviously, the deal is a big win for them. In addition, at the time they made their investments, Skype was a huge legal mess with lawsuits flying.

Skype has since gotten cleaned up enough to attract Microsoft.

Other suitors have looked at Skype, including Google, although acquisition interest by Facebook was very much overblown, said several sources.

Interestingly, Microsoft’s new smartphone partner Nokia also held meetings with Skype’s CEO Tony Bates, a former Cisco exec who arrived at the company last fall.

Interest in Skype by Microsoft was first reported by GigaOm’s Om Malik on Sunday.

Tune in at 5 am PT for the official press release, apparently, and lots and lots and lots of analysis of whether Microsoft paid too much for Skype.

Skype Rival Rebtel Hits 10 Million Users

Ina Fried — Thu, 10 Mar 2011 05:00:14 +0000

Rebtel said late on Wednesday that it has hit 10 million users for its voice-over-Internet calling service and has now connected more than 200 million calls.

Rebtel, which offers free and discount calling on a number of mobile devices, also offered up some financial numbers, saying it is profitable and 2010 revenue was $40 million, up 120 percent from a year earlier. The company said it expects 2011 revenue to reach $75 million.

TellFi Helps Small Businesses Sound Professional on the Phone

Liz Gannes — Tue, 01 Mar 2011 01:48:10 +0000

TellFi launched today a simple Web-based virtual phone system for small businesses. The company helps freelancers and independent shops give off an aura of professionalism with functions like automated extensions and voicemail that would usually require installation by an IT person.

TellFi co-founder Conor Lee pitched NetworkEffect, “Just like individuals, small businesses are ditching landlines too. They have an expectation and need for professional-sounding phone systems.” And meanwhile, traditionally complex and regulated telephony systems are becoming more like cloud services, making them ripe for start-up-style innovation. Lee added, “Telephony is searching for a future where it’s not dumb pipes.”

TellFi is simple by design: it allows users to set up voicemail, call forwarding and extensions. It’s quite similar to the Web-based Google Voice, which is free, but the service costs $10-70 month and promises the customer support and call quality that Google doesn’t guarantee.

TellFi joined the Y Combinator accelerator program two months ago. It is already up and running with 50 companies, mostly other Y Combinator start-ups and real estate agents.

As it developed, the company had entertained thoughts of enabling polling services, and had also built out more complicated features like call scheduling, but it now has a more narrow focus. TellFi has raised funding from Yuri Milner and SV Angel’s Start Fund.

Google Deal for SayNow to Make Google Voice More Interesting

Arik Hesseldahl — Tue, 25 Jan 2011 22:02:50 +0000

I’ve been a Google Voice user since before it was even called Google Voice. Back in 2007, I was fascinated by the potential of GrandCentral–the service Google acquired and transformed into Google Voice.

For one thing, once I gave out my new number to a handful of friends, I had this one goofy friend for whom I recorded a custom greeting. Every time he would call, I’d let it go to voicemail and he’d start every message laughing at some silly in-joke I’d leave for him in the greeting. Okay, I grant you not many people would go to the trouble to do that, but if you knew this guy, you just might. Update: A few readers pointed out in the comments that this feature is re-enabled in Google Voice, and they’re correct though it’s not exactly easy to find.

Ever since GrandCentral became Google Voice, it’s been a lot less fun to use. That custom-greeting feature is gone, as are some of the funnier Web calling buttons that GrandCentral had offered. Maybe that’s one of the reasons behind today’s acquisition by Google of SayNow.

Details are scant about what Google has in mind, but a source close to the deal tells us that the intent on Google’s part is to make Google Voice “even better in a world of Skype and Facetime,” which implies that the next step for Google Voice is some form of video calling.

SayNow made a name for itself by giving celebrities like Miley Cyrus, the Jonas Brothers (remember them?) and the cast of “Glee” a phone number for fans to call and hear the occasional message. And at the start of the football season, ESPN used it to send the message embedded below from former Chicago Bears coach Mike Ditka to some 1.6 million fans on Facebook. Another feature gave celebs a way to hold live conference calls that fans could dial in and listen to. The biggest SayNow client was the rapper Soulja Boy, who racked up 50 million calls totaling some 100 million minutes of call time. If nothing else, Google can learn from the team at SayNow how to promote the service and get people interested in using it.

SayNow also has a serious side, an enterprise application called Big Call, aimed at making conference calls for businesses easy. The company says it was built by an intern in a week.

The deal for SayNow comes on the same day that Google made its long-awaited number-porting feature official, suggesting that Google Voice is going to be the focus of a lot more time and attention in the coming months.

Ditka’s season-opening greeting for Facebook users is below.

Rebtel With a Cause: Free Calling on the BlackBerry

Ina Fried — Fri, 14 Jan 2011 15:00:59 +0000

Mobile Internet telephony firm Rebtel said on Friday that it is bringing its free international calling service to the BlackBerry. The service, which allows free international calls among more than 50 countries by routing the calls over the Internet, has been available for Android since last March. Rebtel also said it plans to add the free calling feature to the iPhone this spring.

“We are committed to bringing innovation into the oligopolistic marketplace to make international calls either free or super-cheap for our customers,” Rebtel CEO Andreas Bernstrom said in a statement. Rebtel’s app automatically notices when an international call is being made and routes the call over its VoIP service, as opposed to making a cellphone call.

Skype Talks About Just How Full That Half a Glass Is (Updated: Glass Now 90 Percent Full)

Ina Fried — Thu, 23 Dec 2010 18:27:16 +0000

While some people are still having trouble using Skype and a few features remain unavailable, the Internet telephony company issued a statement on Thursday touting those services that have returned to operation after a massive outage on Wednesday.

“In the last hour, we’ve seen evidence of a significant increase in the number of people online,” Skype said in a blog posting. “Because of the way the Skype software works, it’s not possible for anyone to obtain an exact figure, but we now estimate it to be over 10 million.”

However, according to a graphic elsewhere on the company’s Web site (see above), that’s still short of the service at peak times (and one would assume that, absent an outage, two days before Christmas might be one of those peak sorts of times).

The blog goes on to mention a few of the other lingering issues. “Please note that some features may not work as reliably as expected,” it said, adding that “peoples’ online status may be slow to update, and instant messages might not be delivered as quickly as they are normally. Group video calling will take longer to return to normal.”

Of course, all that is a lot better than yesterday, when the bulk of the service was down for millions of people.

UPDATE, 11:50 am: Things are looking up, according to the latest post from CEO Tony Bates. He reports that there are now about 16.5 million users online, about 80 percent of normal for this time of day. And a make-good offering is in the works. “I realise that it’s difficult to compensate you for not being able to talk to or see your friends, family or colleagues, but we’re planning to offer Skype Credit vouchers to all of our loyal paying customers to thank you for your continued support,” said Bates.

Here’s the video of his message:

UPDATE, 3:02 pm: Another dispatch from Bates, this time reporting that traffic volume is up to 90 percent of normal now, the system has been stabilized and the engineers think they know what went wrong (and it wasn’t a malicious attack). Bates also offered a few more details on the customer compensation plan. Here’s the video:

Video: Marc Andreessen Talks About the New $650 Million Fund Burning a Hole in His Pocket

Kara Swisher — Wed, 03 Nov 2010 12:23:15 +0000

As BoomTown wrote recently, Andreessen Horowitz finally officially announced a new investment fund it had been raising.

The high-profile entrepreneur-led venture firm pulled in $650 million from its existing limited partners, as well as some new ones.

That’s almost double its first fund of $300 million, with which Andreessen Horowitz invested in companies ranging from gaming phenom Zynga to Internet telephony Skype to geolocation start-up Foursquare.

Andreessen now has 18 people working at its HQ on Sand Hill Road, and expects to expand.

As before, in an interview earlier today, partner Marc Andreessen said the investments would be made across the board in the general area of computer science and set largely in the Silicon Valley area.

But the size and amount of the investments will vary from seed fundings of $50,000 to $100,0000 to venture deals to putting bigger amounts of up to $100 million into growth companies–such as, perhaps, Twitter?

Here is Andreessen talking about it all in this video interview:

[ See post to watch video ]

Can Skype Revive KDDI’s Fortunes in Japan?

Juro Osawa — Thu, 21 Oct 2010 07:00:03 +0000

It may not be so obvious why a Japanese mobile phone carrier would want to make Skype available on its handsets and encourage subscribers to use the Internet-based telephony service. Plus, you can already use Skype on iPhones by downloading the application…so isn’t this an old idea?

But Japan’s KDDI Corp. is embracing Skype nonetheless. By teaming up with Luxemburg-based Skype Technologies S.A., Japan’s second largest mobile carrier plans to make the Skype software available on many of its handsets released from now on, starting with its smartphones.

So how does a Skype partnership make sense?

For one thing, Japanese people are no longer making many calls on mobile handsets. To offset lower voice traffic, carriers are seeking ways to boost revenue from data traffic. If Skype can get people to buy smartphones and sign up for expensive data service plans, that could more than compensate for dwindling revenue from traditional phone calls.

Read the rest of this post on the original site

Aliph Collaboration Deal With Cisco for Jawbones in the Workplace Launches

Kara Swisher — Thu, 30 Sep 2010 12:00:06 +0000

In April, Cisco unveiled a wide-ranging collaboration with Aliph–a San Francisco start-up that is famous for the noise-canceling Jawbone Bluetooth mobile headset–to put its software and device in Cisco’s IP phones in the enterprise.

It launches today.

The Cisco (CSCO) deployment is a big win for Aliph, since the networking giant is a dominant player in the arena to provide telephony solutions to businesses, part of its Voice and Unified Communications division.

The idea is to use the Jawbone device and the software that manages it to allow workers to move around an office and have the call move with them, echoing increasingly mobile consumer behavior. That will even include jumping from office phones to mobile devices.

To do this, Cisco will be using Aliph’s technology, which the start-up is calling a “wearable platform.”

The company was formally launched in 2004–in fact, at the D: All Things Digital conference–by Alexander Asseily and Hosain Rahman, who met as Stanford University undergraduates.

It is funded by Silicon Valley venture powerhouses Khosla Ventures and Sequoia Capital, as well as smaller investors, who put in a total of $43 million.

With the stylish and innovative Jawbone, Aliph has turned a lot of heads in the wireless headset space, aimed directly at high-end consumers.

It is prominently featured, for example, in Apple (AAPL) retail stores.

Now, it is finally in the workplace.

Here is the image of the box for the new Cisco/Aliph partnership:

And here is the official press release:

Jawbone and Cisco Introduce Wireless Headset for Enterprise Collaboration and Beyond

Jawbone Integrates With Cisco Video Endpoints Extending Unified Communications Inside and Out of the Workplace

SAN FRANCISCO and SAN JOSE, Calif. Sept. 30, 2010–Jawbone and Cisco today announced they are closely collaborating to allow employees to easily move from device to device throughout their day. Jawbone ICON for Cisco Bluetooth Headset will intelligently bridge mobile phones and Internet Protocol (IP) phones in a way that is transparent to users and extends unified communications beyond the walls of the workplace.

Users will be able to connect to their Cisco® Unified IP phones and mobile phones simultaneously, creating a truly unified, wireless, and hands-free communications experience as they move from in-the-office to on-the-go. While on the same headset, employees can take a call from their desk phone and the next from their cell phone as calls can be handled from both sources at the same time on the same headset. The headset extends Jawbone’s industry-first wearable software platform, with Cisco technology to deliver applications that span enterprise and mobile use. Jawbone’s industry-leading industrial design and superior ergonomics ensures users can wear their unified communications wherever they go.

Shipments of the Jawbone ICON for Cisco Bluetooth Headsets have begun in the U.S. and Canada, bundled with Cisco Unified IP Phones 9951 and 9971. International shipments will begin in October 2010.

Key Facts / Highlights:

• Users no longer need to remain tethered to their desks; their audio and voice follow them wherever they go, leaving their hands free for other tasks.
• Employees can remain connected to both phones at the same time and don’t have to pick up the handset on their ringing phone, then pick up their cell phone when it rings because both calls from both sources can be handled at the same time on the same headset.
• Users will be able to make and receive calls from their Bluetooth-enabled mobile, Cisco Unified IP Phone, Cisco Unified Wireless IP Phone or Cisco Cius and can switch among the endpoints as they change location.
• Jawbone ICON for Cisco delivers built-in intelligence that allows the headset to be dynamically enhanced through new software applications and functional updates via the Jawbone MyTALK platform.
• As rich new features and functionality are available, the headset can be easily updated either by the IT manager or user themselves.

“We live in an increasingly connected world where the lines between work and play are blurring fast, if not completely gone. People want integrated solutions that are valuable to them all the time regardless of where they are or what they are doing–these need to be lifestyle solutions with the best functionality in a form that is appealing,” said Hosain Rahman, CEO of Jawbone. “No one is willing to make tradeoffs anymore and we are extremely fortunate to be collaborating with a company like Cisco that is committed to leading this vision of new user experiences around the best of both worlds: enhanced productivity through innovative enterprise-grade technology with an equal emphasis on user-centric design.”

“Cisco understands the changing nature of work,” said Steve Slattery, vice president and general manager IP Communications business unit, Cisco. “The Jawbone ICON for Cisco Bluetooth Headset is the type of next-generation device that will allow workers to collaborate regardless of where their work lives. This first wearable and updateable platform is the only one that enables enterprises to get more value out of the device over its lifetime through functional updates as Cisco enhances its UC offering.”

About Jawbone

Jawbone, also known as Aliph, is committed to creating wearable and personal technology products that deliver an unsurpassed user experience. The company’s flagship product, the award-winning Jawbone Bluetooth headset, first disrupted the industry in 2006 with its military-grade NoiseAssassin technology and instantly became recognized as the best Bluetooth headset available. In 2010, Jawbone ICON became the company’s most innovative Jawbone yet; introducing unmatched ease of use, personalization, sound quality and design to the market. Jawbone ICON is currently available in 23 countries across North America, Europe, Middle East and Asia.

The winner of numerous consumer awards, Jawbone features a uniquely stylish design and is part of the permanent collection at various museums including New York MOMA.

Jawbone is a privately-held company headquartered in San Francisco.

About Cisco Collaboration

From award-winning IP communications to mobility, customer care, Web conferencing, messaging, enterprise social software, and interoperable telepresence experiences, Cisco brings together integrated network-based collaboration solutions based on open standards. These solutions, as well as services from Cisco and our partners, are designed to help promote business growth, innovation, and productivity. They also designed to help accelerate team performance, protect investments, and simplify the process of finding the right people and information.

About Cisco Systems

Cisco, (NASDAQ: CSCO), the worldwide leader in networking that transforms how people connect, communicate and collaborate, this year celebrates 25 years of technology innovation, operational excellence and corporate social responsibility. Information about Cisco can be found at http://www.cisco.com. For ongoing news, please go to http://newsroom.cisco.com.

Exclusive: Facebook and Skype Readying Deep Integration Partnership

Kara Swisher — Wed, 29 Sep 2010 07:34:10 +0000

You didn’t think Facebook would integrate with Google (GOOG) Voice, did you?

Actually, according to sources close to the situation, Facebook and Skype are poised to announce a significant and wide-ranging partnership that will include integration of SMS, voice chat and Facebook Connect.

The move by the pair–which have tested small contact importer integrations before–is a natural one for the social networking giant, which is aiming to be the central communications and messaging platform for its users, across a range of media.

Facebook’s goal, according to sources: To mesh communications and community more tightly together and add more tools to allow users to do so.

Since it was not going to create an Internet telephony service of its own–kind of like not creating a mobile operating system–Facebook has apparently turned to the Web’s Internet telephony leader.

Interestingly, Facebook has previously tested a video chat product.

Skype had 124 million people using it at least once a month and 560 million registered users, which will be bolstered by the 500 million Facebook users who will now be able to use it more seamlessly within Skype.

That will include allowing users to SMS and call Facebook friends from Skype, which will now deploy Facebook Connect.

And also do video chat using Facebook in Skype, which you can see below, in a very odd screenshot sent to me by a source–Walt Mossberg’s code name is not Daniel Matthews and I am not Allison Brown. (Click on the image to make it larger.)

This all will be available in Skype’s newest version, 5.0, which emerges from beta in a few weeks.

This is a big win for the Luxembourg-based Skype, which is currently readying a public offering.

While it now dominates the online calling space, it needs to be present where users are now moving, such as Facebook.

And for Facebook, this is also helpful to its international push, making it more appealing globally since Skype is much more popular outside the U.S.

It will be interesting to see if both cross-integrate into their popular mobile apps too.

Facebook has been doing a lot of integrations with other communications services, such as a massive upcoming one with Yahoo (YHOO) and also one with Microsoft (MSFT).

Skype is also increasing its partnerships. Today, for example, it will announce a deal with Avaya, which makes office phones and related software aimed at businesses.

The pair called it a “strategic unified communications and collaboration partnership,” and is centered on business and personal videoconferencing.

After Some Flashy Investing, Is Andreessen Horowitz's Next Move a Big New Fund?

Kara Swisher — Mon, 12 Jul 2010 14:25:21 +0000

Since it launched almost exactly a year ago with a $300 million fund, the venture firm of Andreessen Horowitz has cut a rather high-profile path through the Silicon Valley investing community.

And it’s clear the firm has been aiming to make a big splash in the sector–from its involvement in the fractious fight over the spin-off of Skype to its funding of a series of high-profile start-ups (Zynga, Asana, Kno and Rockmelt) to its most recent aggressive moves to finally win the top spot in investing in hot social location site Foursquare.

Now, according to sources and after spending about half its kitty, Andreessen Horowitz is poised to begin another round of fundraising to further bolster its clout.

While it is unclear how much the VC firm will raise, sources expect it to be much more than its first fund.

In its last go-round, the firm had a quick completion of the fund raising, in the midst of a national econalypse. So many assume the next try will be a lot easier, especially given its knack for grabbing hot deals.

A spokeswoman for Andreessen Horowitz declined to comment on future fundraising plans.

The firm is going to need the money as it expands its partners and ambitions to change the venture landscape, as iconic entrepreneur Marc Andreessen noted when he founded the firm with his longtime business partner Ben Horowitz in July of 2009.

Andreessen said then that he was essentially professionalizing the active angel investing that he and Horowitz had been doing.

Over the last several years, either together or apart, the pair have invested in a large variety of innovative start-ups, such as Twitter, Aliph, Digg, LinkedIn and many more.

Andreessen is on the board of Facebook and an adviser to Twitter too.

In an interview with me last year, Andreessen said that unlike many VC firms, Andreessen Horowitz will invest in companies at any stage of life–from early stage to late–and of any size and in any kind of digital sector and will focus on companies led by tech-savvy founders.

He also expressed a disdain for the way the venture business was run.

“For the first time in my life, I am crossing over into the dark side,” said Andreessen at the time, in a joke about VCs being like Darth Vader.

At the time, he also noted that money talked. “It’s important to have more capital,” he said. “Sometimes having a huge checkbook is a great thing.”

Well, we’ll see if Andreessen Horowitz can make that checkbook even larger.

Until then, here is a tally of investments that Andreessen Horowitz has made so far, sourced from the firm, split up into categories and size of investment round the firm participated in with other investors. The firm declined to provide the exact amount of their participation in each investment.

It should be noted that Andreessen’s and Horowitz’s previous individual investments in some of these companies are not identified here:

Board

Kno: tablet device for students; $7.5 million
Nicira: cloud infrastructure software; $13 million
Okta: cloud app management; $750,000
Proferi: analytic applications; $2 million
Rockmelt; desktop browser for Facebook; unknown funding
Skype: Web telephony; $50 million

Passive

Apptio: IT cost transparency solutions; $14 million
Asana: enterprise collaboration; $9 million
Boku: mobile online payments; unknown funding
Digg: social media and content; unknown funding
Foursquare: social location; $20 million
Fusion I/O: enterprise I/O solutions; $45 million
Tiny Speck: social gaming; $5 million
Zynga: social gaming; $180 million

Seed

Burbn; social location; $500,000
Canvas Networks: image boards; $625,000
Factual: structured data; $1 million
GoodData: cloud-based collaborative analytics; $2.5 million
Quantifind; enterprise; unknown funding
RethinkDB: database storage; $1.2 million
Mixed Media Labs: photo sharing; $370,000
SnapLogic: open-source enterprise data integration; $2.3 million
TopProspect: social recruiting; unknown funding
Vikkii: user-generated subtitling; unknown funding
Ze Frank Games: online gaming; unknown funding

And here are video interviews BoomTown has done with both Andreessen and Horowitz in the last year on their investing theories:

Post-Legal Soap Opera: Skype CEO Josh Silverman Speaks!

Kara Swisher — Mon, 10 May 2010 15:30:52 +0000

Late last week, BoomTown sat down with Josh SIlverman, CEO of Skype, to get an update on the popular Internet telephony company.

When we last checked in with Skype, it had turned into the “Peyton Place”–look it up, kids!–of the online telecommunications arena, with lawsuits flying, venture capitalists getting slimed and a general tone of very purple drama.

But in November, settlement of the troubles came, as I wrote:

Silicon Valley legend and now VC Marc Andreessen was making the interview rounds after the settlement between the litigation-addled co-founders of Skype and all the various people they were suing was announced this morning.

He has been tight-lipped until now, due to the morass of lawsuits.

But, as Andreessen told BoomTown in a phone interview about the aggressive legal tactics of Niklas Zennström and Janus Friis that resulted in them finally seizing a stake in the Internet telephony giant by suing him and many other Silicon Valley players:

“We did not take it personally. It’s a clean sheet of paper.”

Well, it is actually a torn, stained and very worn out piece of paper, due to all the various machinations, but bygones!

Andreessen–who knows a thing or two about legal tussles, if you recall Netscape-Microsoft (MSFT)–said the real point is that it is time to focus on the business of Skype rather than fighting over who controls Skype.

“It’s really good to have everyone lined up and rowing in the same direction. We have to capitalize on the opportunity, because Skype is poised for a new wave of growth,” said Andreessen. “They have an amazing head of steam, because the logical way for voice and video communications to be conducted will be over the Web.”

That’s, of course, what Silverman–who has been running Skype since it was owned by eBay (EBAY) outright–wants to focus in on now.

While the e-commerce giant still owns a 30 percent chunk, Silverman is now trying to navigate Skype back to its disruptive and innovative roots, even as big telcos and Internet giants such as Google (GOOG) continue to aggressively compete head-on with it.

He’s doing that using a range of tactics to goose the service’s growth–from cheaper rates to more features to improving ease of use. Given that video is the big focus for Skype going forward, Silverman noted that the company is looking at all kinds of new ways to share presence.

Here’s the video of my interview with Silverman, which took place in San Francisco (although Skype operations are located all over the global map, including what will soon become a larger unit in Silicon Valley):

[ See post to watch video ]

Aliph in Collaboration Deal With Cisco–Jawbones in the Workplace?

Kara Swisher — Wed, 28 Apr 2010 15:40:39 +0000

Today at a partner event, Cisco will unveil a wide-ranging collaboration with Aliph–a San Francisco start-up that is famous for its noise-cancelling Jawbone Bluetooth mobile headset–to deploy its software and device in its IP phones in the enterprise.

It is a big win for Aliph, since the networking giant is a dominant player in the arena to provide telephony solutions to businesses, part of its Voice and Unified Communications division.

The idea, said sources, is to use the Jawbone device and the software that manages it to allow workers to move around an office and have the call move with them, echoing increasingly mobile consumer behavior.

BoomTown had heard rumors of intense interest in Aliph by Cisco (CSCO) months ago and assumed a purchase to add to its growing consumer portfolio, such as its recent acquisition of Pure Digital’s Flip camera line.

But that did not turn out to be the case–instead it is more a partnership, said sources, to use Aliph’s technology.

The company was formally launched in 2006–in fact, at the D: All Things Digital conference–by Alexander Asseily and Hosain Rahman, who met as Stanford University undergraduates. It is funded by Khosla Ventures and Sequoia Capital.

With the stylish and innovative Jawbone–the most recent of which is reviewed here by The Mossberg Solution’s Katherine Boehret–Aliph turned a lot of heads in the wireless headset space, aimed directly at high-end consumers.

Now, it is apparently pivoting into the workplace.

While Rahman confirmed the collaboration, he did not give a lot of details, although he did agree to sit down with me last night to broadly sketch out the new relationship.

Here’s the video of the interview:

[ See post to watch video ]

Andreessen Horowitz's Ben Horowitz Talks About Fat Start-Ups, Being a New VC and What's Hot and Not!

Kara Swisher — Fri, 16 Apr 2010 15:08:14 +0000

Yesterday, BoomTown motored down lovely I-280 to meet with (relatively) newly minted VC Ben Horowitz, the other half of the high-profile venture firm Andreessen Horowitz.

Started last summer by the pair–who have worked together since they met not-so-cute at Netscape Communications, with co-founder Marc Andreessen flaming worker-bee Horowitz in an email–it’s a $300 million fund that has plunked itself in the middle of just about every hot thing in Silicon Valley and beyond of late.

That includes being part of a recent huge round in online games rocket ship Zynga, a controversial consortium that grabbed Skype (Horowitz is on the Internet telephony giant’s board), as well as being a key investor in smoking stealths such as Kakai and RockMelt.

Of course, the pair is also in the race to fund mobile geolocation phenom Foursquare against a possible Yahoo (YHOO) acquisition.

Horowitz, who has long had a much lower profile than one-time digital golden boy Andreessen, is now emerging a little more publicly via a new blog, called simply Ben’s Blog.

With the apt quote at the top of the homepage by legendary mathematician and computer pioneer John von Neumann, “There’s no sense in being precise when you don’t even know what you’re talking about,” it’s a pretty saucy effort, especially if Horowitz keeps it up.

Recent posts included “Four Things Some VCs Do That I Don’t Like” and “The Case for the Fat Start-Up,” which he first published on All Things Digital.

We talked about this and more in a breakfast interview at the Rosewood Hotel on Sand Hill Road near Andreessen Horowitz’s offices, so here’s the video:

[ See post to watch video ]

Index Invests $25 Million in Sonos (Plus a Video Interview With VC Mike Volpi)

Kara Swisher — Fri, 12 Mar 2010 17:00:57 +0000

Earlier this week, BoomTown had lunch with Michelangelo “Mike” Volpi, the high-profile tech exec who turned into a venture capitalist recently at Index Ventures.

We also did a video interview (see below) about his new life as an investor, based in London, although Volpi managed to leave out the big news.

That would be a just-inked $25 million investment by Index from its growth equity arm in wireless home music system maker Sonos, as well as a new board seat there for Volpi. (Sonos’s hot new S5 unit is pictured here.)

In an interview this morning, Sonos CEO John MacFarlane said the money would be used for expansion at Sonos, which is just about to introduce its products to China and Japan.

“This investment is going to help us grow,” said MacFarlane. “We have wind at our back and this will help us a lot in keeping up that momentum.”

MacFarlane said the focus for Sonos, which has garnered $65 million–from BV Capital and mostly angel investors–with the Index investment included, is growth. He declined to give Sonos’s valuation in the new round.

The private company has been profitable, MacFarlane said, but its goal is to break even as it takes advantage of interest in its devices globally. Only about 35 percent of its business is now in the United States.

While running a small independent consumer electronics company is a dicey proposition, MacFarlane said Sonos is not interested in selling, as Pure Digital–maker of the Flip digital camera–did to Cisco (CSCO) a year ago for $590 million in stock.

In fact, Santa Barbara, Calif.-based Sonos, which is well known for its innovative top-line (and high-priced) music players, recently moved its business more mainstream with the introduction of the S5 unit in November.

The S5 allows control of the system via an Apple (AAPL) iPhone and only costs $399. (Here is a review of it by The Mossberg Solution’s Katie Boehret.)

The basic idea? A smart speaker paired with a smartphone.

The S5 has been a big seller and has increased product registration–when the software is activated by a user–by five times previous numbers so far, according to the company.

That could get a further boost with the April launch of the iPad, which seems perfect for controller software apps.

“The popularity of the iPhone is great for us,” said MacFarlane. “And we’ll do something great with the iPad.”

It will be nice to have a big score for Volpi, the former Cisco wunderkind. In fact, he invested in one of MacFarlane’s previous start-ups, Software.com, in 1995 when he was in charge of a variety of businesses there.

But the affable Volpi hit a bad patch recently while CEO of a much hyped but ultimately failed video service called Joost. It was that job that landed him in even hotter water.

In the wake of the decline of Joost, which he left to join Index, he was personally sued, along with Index, by its litigious co-founders over Index’s planned investment in Skype, the online telephony service they also co-founded.

Confused? Well, it was confusing.

And not the best start in the investment business for Volpi, after Index pulled out of the high-profile deal in a settlement of the lawsuits.

But, that’s “ancient history,” as Volpi said in the video interview below, which focuses on what’s next.

(News of the Index involvement in Sonos was first reported by TechCrunch earlier this week, though it did not have any details on the amount of funding.)

Although he did not mention the $25 million Sonos funding specifically in the video, Volpi does discuss his bullishness for consumer electronics.

Volpi presumably hopes others share his enthusiasm.

Here’s the video of my interview with him:

[ See post to watch video ]

From the Department of Oh No, She Didn't: Whitman Defends eBay's Skype Debacle

Kara Swisher — Wed, 11 Nov 2009 19:30:19 +0000

If spinning is an intense political skill, former eBay CEO Meg Whitman is doing her very best at trying to create a silk purse out of a sow’s ear.

As Om Malik reports on GigaOm, Whitman–who is trying to nab the Republican gubernatorial nomination in California–told a radio interviewer recently that “actually I think Skype will prove to be a good acquisition for eBay.”

Well, good if you mean the $2.6 billion purchase of the Internet telephony company that never worked as Whitman had effusively promised in 2005.

She noted then: “By combining the two leading e-commerce franchises, eBay and PayPal, with the leader in Internet voice communications, we will create an extraordinarily powerful environment for business on the Net.”

That fabulous-sounding synergy did not happen, of course, eventually causing new eBay (EBAY) management to sell a huge chunk of Skype to an investor group.

Best of all, that sale included an ugly and expensive legal fight over software technology licensing issues with its co-founders, Niklas Zennström and Janus Friis, given that Whitman neglected in the competitive bidding to secure them properly.

That resulted in Zennström and Friis forcing eBay to include them just last week in the deal for a big chunk of Skype in exchange for those rights.

As the sick political joke goes: Other than that, Mrs. Lincoln, how was the play?

Nonetheless, Whitman has not let the facts get in the way of a good story!

She kind of had to, I guess, responding to an allegation by one of her rivals in the race, tech entrepreneur Steve Poizner, who has tried to chip away at her blue-chip business reputation by attacking the Skype deal.

Whitman was right to defend a lot of other great acquisitions she made as leader at eBay, such as PayPal; and she can be, as she said in the interview, “proud of my tenure at eBay.”

She should be, given that she was key to building a huge and profitable company that is a clear Silicon Valley Internet icon. While eBay did start to creak near the end of her decade-long stint there, many of Whitman’s accomplishments are nonetheless impressive.

But not all of them and definitely not the Skype buy, so she might want to stop making laughable declarations like this one in the interview:

“You probably read that the company just sold about two-thirds of the interest in Skype to an investor group, kept a portion, and got almost all the money back, and I think Skype will be very effective.”

Well, maybe so, but only because new management had to do clean-up and pay-up for her error, and new owners in charge of Skype could possibly better take advantage of what most consider a terrific property.

So, in the end, Whitman might be right.

And it might not even matter. In a recent poll, Whitman has pulled far ahead of ex-Congressman Tom Campbell, with 34 percent support from Republican primary voters compared to 13 percent for Campbell. Poizner clocks in third at six percent.

All Is Forgiven: "It's a Clean Slate," Says Andreessen About Lawsuit-Mad Skype Co-Founders

Kara Swisher — Fri, 06 Nov 2009 19:28:48 +0000

Silicon Valley legend and now VC Marc Andreessen was making the interview rounds after the settlement between the litigation-addled co-founders of Skype and all the various people they were suing was announced this morning.

He has been tight-lipped until now, due to the morass of lawsuits.

But, as Andreessen told BoomTown in a phone interview about the aggressive legal tactics of Niklas Zennström and Janus Friis that resulted in them finally seizing a stake in the Internet telephony giant by suing him and many other Silicon Valley players:

“We did not take it personally. It’s a clean sheet of paper.”

Well, it is actually a torn, stained and very worn out piece of paper, due to all the various machinations, but bygones!

Andreessen–who knows a thing or two about legal tussles, if you recall Netscape-Microsoft (MSFT)–said the real point is that it is time to focus on the business of Skype rather than fighting over who controls Skype.

“It’s really good to have everyone lined up and rowing in the same direction. We have to capitalize on the opportunity, because Skype is poised for a new wave of growth,” said Andreessen. “They have an amazing head of steam, because the logical way for voice and video communications to be conducted will be over the Web.”

Thus, Zennström and Friis now join the winning buyout group, Silver Lake Partners, Andreessen Horowitz and the Canada Pension Plan Investment Board, along with eBay, in owning Skype.

But Index Ventures, which was in, is–as Heidi Klum might say–out!

Under the terms of the agreement, Niklas Zennström and Janus Friis will take a 14 percent stake in the company they founded and then sold to eBay (EBAY), which will include an undisclosed investment by them.

I reported yesterday that the total was 13 percent–10 percent for the rights to key Skype technology held by the co-founders and the option to invest $83 million for three percent more.

In exchange, the pair will give Skype software essential to its operation and drop their various lawsuits against eBay and Skype’s buyers.

As for Zennström and Friis’s egregious use of the courts to grab their 14 percent stake in Skype, litigation they waged after losing their bid to buy Skype back from eBay, Andreessen was being very politic.

“We love working with aggressive founders and are in favor of founders being involved in their companies,” he said. “Great founders are not known for being shy and reserved. Look at Bill Gates. It’s not a question of personality, but of accomplishment.”

Noting that he had not worked with the pair before, Andreessen (pictured here) said, “We have a lot of respect for them. We think they’re geniuses.”

But, I queried, would he have used such tactics?

“It’s not a book club, it’s a super-serious, high-stakes game,” said Andreessen. “I don’t know; I’ve not been in the situation they’re in. If your goal in life is to avoid drama, this is probably the wrong industry for you.”

Perhaps, but I told him that I doubted even a battle-hardened entrepreneur like Andreessen would use the courts in such a manner to achieve business goals.

To each his own, said Andreessen!

“One of our investing mottos is that we invest in strength, not lack of weakness,” he said. “The question is how big is the opportunity.”

And, apparently, it is big enough to overlook all the drama that has gone on.

Andreessen said he expects to be more involved at Skype–which, with his $50 million investment, is the biggest deal in his $300 million fund–than other board members, noting different directors have different roles.

It’s a big board of 23, as I had previously reported. Zennström and Friis are each getting a seat.

“We are going to be helpful,” Andreessen said about his fund’s role at Skype. “We’re a company picker, looking for those that have the greatest potential.”

Andreessen, ever the diplomat, made sure to add that that also means doing business with Index, the member of his Skype consortium that departed as Friis and Zennström (pictured here) entered, due to stark tensions between the two sides.

“I have a lot of respect for [Index partners Danny Rimer and Mike Volpi] and expect to work with them a lot in the future,” said Andreessen. “In fact, I am talking to them today about two other deals.”

In other words, in Silicon Valley, the big wheel just keeps on turning.

Silly Skype Soap Opera Finally Canceled

John Paczkowski — Fri, 06 Nov 2009 15:22:21 +0000

The fight for Skype has ended. After weeks of nasty legal sparring, the Internet telephony service’s founders agreed to join the investor group purchasing it from EBay (EBAY) and dropped the lawsuit that had threatened to bollocks the deal.

“Skype will be well positioned to move forward under new owners with ownership and control over its core technology,” said eBay chief executive John Donahoe in a statement. “We look forward to closing the deal and focusing on growing our core e-commerce and payments businesses.”

Under the terms of the agreement, Skype founders Niklas Zennström and Janus Friis will take a 14 percent stake in the company they founded and then sold to eBay, which will include an investment by them.

BoomTown’s Kara Swisher reported yesterday that the total was 13 percent–10 percent for the rights to key Skype technology held by the founders and the option to invest $83 million for three percent more.

In exchange, the pair will give Skype software essential to its operation and drop their various lawsuits against eBay and Skype buyers.

Interestingly, Index Ventures, which helped orchestrate the deal, is leaving the consortium of investors taking a majority stake in the company–as BoomTown reported earlier this week. Index partner Michelangelo Volpi, a former employee of Skype’s founders, had been at the center of one the suits that threatened to ruin the deal. Said Index partner Danny Rimer: “The deal terms changed for Index such that it no longer matches our investment criteria and thus we have decided not to participate in the transaction.”

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