The Menlo Park, Calif., venture firm, which has backed tech companies such as Google Inc. and Zynga Inc., is preparing to raise its 15th early stage fund — which is regarded as its main fund — said these people. Kleiner has told investors its new fund will be around the same size as its prior early stage fund, Fund XIV, which it raised in 2010 sized at around $650 million, said these people.

Read the rest of this post on the original site »

The bare facts are these, according to this lengthy analysis by Bloomberg News: Since 1953, the U.S. has imported more energy-producing resources than it has exported. The main reason is that the U.S. doesn’t have a lot of domestic oil production and has always relied on imports from other countries, many of them countries in the troubled Middle East. In a political context, the phrase “energy independence” is usually associated with pie-in-the-sky notions of being free from the odious burden of foreign policy entanglements in that region.

But now, Bloomberg says, the idea is no longer so pie-in-the-sky: Last year, the U.S. produced about 81 percent of its energy, up from a recent low of 70 percent in 2005. What gives? A boost in domestic oil production, more efficient cars, stricter mileage standards, ethanol in our gasoline and a significant surge in U.S. production of natural gas. In fact, if this keeps up, the U.S. is on track to be the biggest energy producer in the world within eight years.

Does that sound like something of an opportunity? You’d better believe it. Insight Venture Partners, the New York-based venture capital and private equity firm that has in the past invested in tech properties like Twitter, Tumblr, LivingSocial and FlipBoard, is leading a massive $165 million investment in a Texas-based oil and gas database company called Drilling Info.

Essentially, what the company does is provide a lot of incredibly specialized information about where energy resources like gas and oil wells are located, what its characteristics are, how long a site is likely to be productive, and so on. The database is offered via the cloud as a software-as-service product. “It really focuses on giving energy companies the data they need to make smarter decisions about where and how they spend their production resources,” Deven Parekh, managing director at Insight, told me. The database tracks information like depletion curves — a measure of how long a well can continue producing oil — and environmental information, seismic data and so on.

Offering it as an SAAS product just makes it easier to manage and maintain. Once upon a time, database companies would send out CDs with software and data updates. Using the cloud makes it easier to keep the data current, and to save on costs.

Parekh told me that Drilling Info has about 3,000 customers in the U.S. and worldwide; and while he wouldn’t disclose its annual revenue, he said it’s in the tens of millions each year. Its customers produce about 90 percent of the oil and gas produced in the U.S. A lot of its demand is coming from companies working on so-called “unconventional exploration” for oil and gas resources, and there’s also significant international interest, too. For example, there are more companies working on methods for getting hard-to-reach oil in shale reserves.

Parekh says the moment has come for some serious investment in energy production technologies. “Everyone pays attention to all the innovation going on at Apple and Google, but what they tend not to appreciate is how much innovation is taking place in the energy industry,” he said. “We don’t talk about it every day, but there’s so much going on.”

Battery Ventures and Eastern Advisors Private Fund are also investing, and at least part of the funding round is going toward earlier shareholders. The capital will be used to expand its customer footprint, but also to possibly make some acquisitions.

Note: Initially the headline on this story said it was Index Ventures, not Insight, making the investment. I’ve since corrected it, though the initial erroneous headline is still making the rounds on Twitter. Sorry about that.

Consider, then, the irony that I find myself at the Venture Capital in the Rockies conference at the Beaver Creek ski lodge near Avon, Colo., something of a skiing mecca, where pretty much everyone lives to glide down the mountain, and many people seem to take jobs that happen to include lift tickets as a fringe benefit. The conference is really only a day long, but is scheduled for two. Today is the “ski day,” where everyone disappears to take to the slopes. Except me.

I’m here because I was invited to speak on a media panel with reporters from a few other organizations. We talked for an hour or more about the changing nature of journalism and all that that entails, where before a crowd of start-up entrepreneurs and venture capitalists, we wondered aloud about such things as whether venture capitalist and Zynga director Brad Feld counts as a journalist because he also writes a widely read blog. Answer: No. The start-ups, most seeking some kind of investment, gave short presentations on their companies.

Here are a few of the companies that caught my attention, either because I saw their presentations or because I met their executives:

Flixmaster: How many times have you stopped watching a Web video that was going on too long, or because you couldn’t easily navigate to a particular highlight you wanted to see? What if Web videos were as readily navigation-friendly as a Web page? Flixmaster has a software-as-service video technology that makes Web video a lot more interactive than it generally is today. If you hope to engage potential customers with video, it helps to increase viewing time. And adding interactivity to a video nudges viewers to stick with a video longer. Many stop watching after less than a minute, CEO Erika Trautman said in her presentation. The videos are in HTML5, which means they’re already iPad- and Android tablet- and smartphone-friendly. You can get an idea of the result from this holiday-themed video on the company’s blog.

Mocavo: In the Web genealogy business there is as yet really no serious competition to the dominant player, Ancestry.com. Mocavo aims to bring it by challenging Ancestry’s walled-garden approach. In six months, it claims to have added six billion genealogical names to its index. Compare that to the nine billion records that Ancestry amassed over 15 years. Mocavo books $60 per new subscriber versus $20 per month for Ancestry. It aims to make people’s genealogical information a lot more easy to share on social media sites, and to publish.

Dizzion: This enterprise-focused start-up aims to help CIOs tackle the big trend you constantly hear about these days, the consumerization of IT: That’s where employees bring their personal devices to work and expect to have them supported. Its product is a “virtual desktop,” or desktop as a service, that provides an operating system, software, files and other stuff you need to get through the workday, all from the data center running as a managed service. Users can access it all from a desktop machine or a tablet or smartphone.

CMDirect: This company got my attention mainly because it was so unlike all of the others in attendance. It’s basically an electronic trading platform that specializes in commodities like sugar, which at the moment is the only commodity that is currently traded on it, but plans are in the works to expand into coffee and soybeans. It’s not about trading futures, but in the actual commodities, and includes a lot of tools for managing risk. The CEO, Julie Lerner, is a veteran commodity trader with Cargill, and has a lot of specialized knowledge in how that world works. The company has a bunch of patents pending around its processes and tools.

Sestus: This is a security and authentication company that caught my attention in part because during its presentation, CEO Taun E. Willis said that the firm is taking business away from RSA, the security unit of IT giant EMC. In a world where passwords are just not good enough at keeping intruders out, you need to authenticate using two factors, a password and something else. RSA hardware tokens are popular and widely used, as are the “soft” tokens that simulate the hardware tokens in software running on smartphones. Instead, Sestus offers virtual tokens that are less costly to deploy and to support than hardware and software tokens. It’s a small outfit, but punches above its weight, sporting 260,000 U.S. consumers who use its virtual tokens to access online accounts. One big customer is the U.S. Department of the Treasury, where Willis said Sestus supplanted RSA.

NextGreatPlace and Inspirato: If there was a rivalry to be found among any of the presenting companies, it was between these two. NextGreatPlace is a play on the vacation club theme. Members join for an annual fee, said to be in the sub-$1,000 range, for access to a network of vacation homes. It combines an online and offline travel planning process that’s been described as “Zappos for travel.” Inspirato, on the other hand, aims to do something similar, but with an emphasis on luxury and higher-net-worth travelers. I sat next to its CEO, Brent Handler, at dinner Tuesday night, and he told me that its members pay a one-time fee of $15,000 and an annual membership fee of $2,500 for access to a network of high-end vacation homes in your typical luxury destinations like Colorado, Hawaii and the Caribbean.

So those are but a few of the companies that presented here. The snow has been falling all day, and everyone around me is going on about how it’s a perfect day for skiing. So I’m off to go take my first downhill skiing lesson ever. I’ll let you know how that turns out.

Update: I originally said that AOL founder Steve Case was an investor in NextGreatPlace. I got mixed up. It turns out that he had backed NextGreatPlace founder in founder Tom Filippini’s prior company, Exclusive Resorts. Sorry about that.

The Silicon Valley company on Wednesday is announcing a $100 million venture capital fund to accelerate technology innovation in cars. Intel said it will also establish a product development center in Germany that will focus on the field.

Read the rest of this post on the original site »

That was July. Wednesday, Domo will announce that it has raised another batch of money, and is bringing in a new investor. The company has closed a $20 million round led by Institutional Venture Partners.

IVP, which had invested in Omniture and so has a history with James, is joining an all-star cast of investors including Benchmark Capital; Andreessen Horowitz; Ron Conway and David Lee of SV Angel; and Hummer Winblad, plus a bunch of personal investments. The round — which is being described as an A-1 round, brings Domo’s total capital raised to date to $63 million.

IVP general partner Todd Chaffee said Domo is an example of a dynamic management team going after a high-growth market. “We know Josh has the experience to build Domo into a disruptive and dominant player in a growing $10 billion market,” he said in a statement. Aside from Omniture, IVP has backed HomeAway, MySQL, Twitter and Zynga.

James wouldn’t tell me the implied valuation, but he did concede that it’s upward of “a couple hundred million.” And if that’s not surprising enough, what’s equally surprising is one possible use for the money: Acquisitions. Well, maybe.

“Let’s just suppose, and this is 100 percent supposition,” he told me over the phone Tuesday, “that we want to buy someone. We’ve thought about it. We’ve had potential targets cross the email threads. It’s not the right time to do that stuff just yet. But it’s nice to know we have the flexibility when the time comes.”

So where’s Domo, the business intelligence software-as-service play he was building? It’s running as a demonstration with a few early customers, he says. And he’ll have more to say about it publicly in about three to four months.

“We have a few thousand people who say they want to see a demo, and we’re working through that list,” James says. “The feedback has been more positive and at a higher rate than I would have thought possible. I think we’re going to have to figure out how to do a lot of installations all at once.”

That’s what we call a good problem to have.

Man, have you ever really wondered
Like why are we here? What the meanin’ to all of this?
– OutKast, “Church”

Since Marc and I founded Andreessen Horowitz three years ago, we have raised $2.7 billion. That statement begs a few questions. The two most obvious are:

• Why did such a new venture capital firm raise so much money?
• How did such a new venture capital firm raise so much money?

To get to the answers, it’s useful to go back to the original motivation for starting Andreessen Horowitz.

After raising our first round of funding for Loudcloud in 1999, we went to visit our new venture capital firm and meet their full team. As founding CEO, I remember being quite excited to meet our financial backers and talk about how we could partner to build a great company. That excitement took a sharp downhill turn when one of the top partners said to me, in front of my co-founders, “When are you going to get a real CEO?”

I was completely stunned — the comment knocked the wind out of me. Our largest investor had basically called me a fake CEO in front of my team. I said, “What do you mean?” — hoping he would revise his statement and enable me to save face. Instead he pressed on: “Someone who has designed a large organization, someone who knows great senior executives and brings prebuilt customer relationships, someone who knows what they are doing.”

I could hardly breathe. It was bad enough that he undermined my standing as CEO, but to make matters worse, I knew that at some level he was right. I didn’t have those skills. I had never done those things. And I did not know those people. I was the founding CEO, not a professional CEO. I could almost hear the clock ticking in the background as my time running the company quickly ran out.

Could I learn the job and build my network fast enough, or would I lose the company? That question tortured me for months.

In the years that followed, I remained CEO, for better or worse. I worked incredibly hard to close the gap between what the partner had described and where I was at the start. Thanks to a lot of effort and help from friends and mentors, especially Bill Campbell, the company survived and ultimately became quite successful and valuable.

However, not a day went by when I didn’t think about that interaction. I always wondered how long I had to grow up, and how I could find help to build my skills and make the necessary connections along the way.

Marc and I discussed this often. We wondered aloud why, as founders, we had to prove to our investors beyond a shadow of a doubt that we could run the company, rather than our investors assuming that we would run the company we’d created. This conversation ultimately became the inspiration for Andreessen Horowitz.

Marc and I share a simple belief that became the basis for our new venture capital firm: In general, founding CEOs perform better than professional CEOs over the long term, and a venture capital firm that enables founding CEOs to succeed would help build the best companies and yield superior investment returns.

As we set out to design a venture capital firm that would enable founders to run their own companies, we began by asking: In what ways are professional CEOs superior to founder CEOs?

Professional CEOs bring two core advantages to the table:

• Superior skill set — Being CEO requires vast know-how that is very difficult to gain without extensive experience actually being CEO. Founders with no CEO experience naturally make many critical mistakes during their “on the job training” period. Excellent professional CEOs already have those skills.
• Superior network — Great professional CEOs know lots of outstanding executives and employees. They also know key reporters and analysts, important potential customers and top industry players. Founders tend not to have enough industry experience to know all these people, and need to build their networks almost from scratch.

Next, we asked: How might a venture capital firm help close those gaps?

Addressing the skill-set issue proved to be difficult because, sadly, the only way to learn how to be a CEO is to be a CEO. Sure, we might try to teach some skills, but I know from experience that learning to be a CEO through classroom training would be like learning to be an NFL quarterback through classroom training. Even if Peyton Manning and Tom Brady were your instructors, with no experience, you’d get killed the moment you took the field.

We decided that while we would not be able to give a founder CEO all the skills she needed, we would be able to provide the kind of mentorship that would accelerate the learning process. As a result, our first requirement for General Partners is to be an effective mentor for a founder striving to be a CEO. This is why so many of our General Partners are former founders or CEOs or both, and they are all highly focused on helping founders become outstanding CEOs.

Of course, not all founders want to be CEO — there are companies for which the right thing is to bring in a professional CEO. For those companies, we focus on helping the founders identify the right CEO, and then helping the CEO successfully integrate into the company and partner with the founders to retain their unique strengths.

Next, we went after the network.

Existing venture capitalists with whom we had worked had important industry relationships, but we found them to be lacking in the following ways:

• Siloed — As an entrepreneur, you can often count on the General Partner on your board to introduce you to customers or executives, but you can’t count on the venture capital firm itself. Each General Partner has his own distinct network, and it’s not really feasible or practical to access the other partners’ networks because those partners prioritize their own companies, and in practice you will never see them — they are not available to help you. So, there is no firm-wide network you can plug into.
• Hard to access — As CEO, it’s always a bit weird to say to your VC, “Please introduce me to some potential customers.” First, it seems like an inconvenience — VCs are clearly busy people, with many other things to do. Second, there isn’t any easy process to execute that introduction. Where will this introduction take place? Will the VC set up the meeting? Will you have to fly out to see the prospect? Will the VC come with you? Will the prospect be qualified well enough to do that? If not, then should you even ask? To make matters worse, the need to meet customers is not a one-time event. How do you ask your VC the second, third and tenth times? And at what point does your VC start to judge you as incapable of reaching customers (or partners, distributors, suppliers, investors or acquirers) on your own?
• Incomplete — Finally, VC networks tend to be incomplete. A certain General Partner might know a certain type of customer, like telecom carriers; but not others, like pharmaceutical companies or government agencies. They may know customers, but not have deep relationships with key reporters. They may know key reporters, but not know executives you would want to hire. They might know executives, but not engineers. As founding CEO, one tends to be busy. If you spend time trying to tap a network and come up empty, you probably won’t bother trying again.

To address these issues, we designed Andreessen Horowitz’s network to be firm-wide, dead simple to access, and comprehensive — supported by operating partners who work full-time to develop and manage each branch of the network.

This approach has already lead to some stunning results:

• In 2011, we hosted over 600 portfolio presentations to corporate customers and partners at our office in Menlo Park. These presentations resulted in more than 3,000 introductions between portfolio companies and prospective Fortune 500/Global 2000 senior executives.
• We’ve built relationships with over 4,000 engineers, designers and product managers, and we’ve made more than 1,300 introductions to our portfolio companies, resulting in 130 hires within the portfolio.
• We added over 550 executives to our network in 2011, and made more than 300 executive introductions to our portfolio companies.
• We’ve had nearly 400 interactions with media on behalf of our portfolio companies.

Through these practices, we’ve been able to help founders develop critical CEO skills and wield networks as broad and powerful as the best professional CEOs. And that is why we have become a popular firm among founders.

Our reputation with founders has then enabled us to invest in great entrepreneurs building the great new technology companies. Interestingly, the demand from entrepreneurs has come in all stages and sizes. From seed-stage entrepreneurs like JR Rivers at Cumulus Networks, to entrepreneurs with fast-growing enterprises like Brian Chesky at Airbnb, great founders everywhere want to be the best CEO that they can be, and work with us to help them do that.

And that’s both how and why we raised $2.7 billion. We are uniquely positioned to help the greatest technology entrepreneurs in the world build the best technology companies in the world, and that’s just what we’re going to do.

It’s better when it’s a charismatic one like Mike Maples and even more fun when there is an audience. Well, at last week’s Founder Showcase, I had the chance to chat on stage with up-and-coming investor Mike Maples, Jr.

Maples, for those who don’t know, is partnered with Roger McNamee in pushing a new strategy about where the markets are headed.

On stage at the Founders Showcase, we talked about his investment philosophy and batted about lots of surfing metaphors.

To summarize, Maples thinks the social networking wave has already crested and he’s moving on to catch the next wave in a less crowded part of the beach.

But, I’m just as clueless about surfing as I am about investing. So I recommend you check out the video of our interview to get the full sense of things.

To really appreciate that video, I recommend also checking out the interview that preceded my chat with Maples. First of all, it explains some of the inside references Maples and I make. It also explains why I hid the microphone from Founder Showcase chief Adeo Ressi. (You can have it back now, Adeo.)

Plus, it’s a darn good chat between the New York Times’ Evelyn Rusli and venture capitalist Mark Suster.

Since participating in a $112 million funding of Web darling Airbnb Inc. in July that valued the online room-rental company at more than $1 billion, Mr. Andreessen said his venture-capital firm Andreessen Horowitz has “taken a step back.”

With some deals for private companies “definitely on the expensive side” amid a choppy stock market and concerns over a European debt crisis, Mr. Andreessen said he is looking to invest in fast-growing tech start-ups that aren’t as well known and where “pricing is still under control.”

Read the rest of this post on the original site »

Mu Sigma helps some of the world’s biggest corporations make sense of the vast amounts of data being produced online. The company, which is headquartered in Chicago with most of its analysts in Bangalore, employs about 1,500 people, up from about 1,200 in June.

The latest funding round was led by General Atlantic, with Sequoia Capital, a current investor, raising its stake. Sequoia had invested $25 million in Mu Sigma in June. The valuation set by the latest fundraising wasn’t disclosed.

Read the rest of this post on the original site »