AllThingsD » Web 1.0

CafeMom Launches Daily Deals and Plans Hispanic Moms Site

Kara Swisher — Wed, 04 May 2011 12:27:36 +0000

CafeMom, a social-networking and community site aimed at mothers, is expanding its offerings to daily deals, as well as announcing an anticipated launch of a site aimed at Hispanic moms.

The deals effort has just been launched under the killer URL of Mom.com and will first be available in the Northern New Jersey area.

The sales force, which will presumably compete with armies of sales people from social buying phenoms such as Groupon and LivingSocial, will be made up of local moms in these markets.

The “Mamas Latinas” site–which is still unnamed–will be run by former People en Español publisher Lucia Ballas-Traynor, who has just been hired by CafeMom.

In an interview yesterday, its co-founders Michael Sanchez and Andrew Shue said the New York-based CafeMom was aiming at another major growth spurt.

Said Shue of the effort so far: “It’s just two dads trying to create the definitive mom’s site.”

There is a lot of competition in the space, such as iVillage, which is more broadly aimed at the lucrative women’s space.

But CafeMom had attracted attention too and had considered a number of acquisition offers last year, before deciding to expand its service on its own.

Last summer, in fact, Yahoo and several other companies expressed interest in the possibility of acquiring CafeMom.

After considering a variety of offers, said Sanchez, who is CEO of CafeMom, “We think we have a unique opportunity to grow ourselves and not for someone else.”

The company has been knocking around for a long time in Internet terms, morphing from a sister company owned by CMI Marketing called ClubMom back in the Web 1.0 days.

CMI, which was also founded by Shue and Sanchez, finally got two big fundings in 2008 totaling $24 million, from venture firms such as Highland Capital Partners and Draper Fisher Jurvetson.

Moving from what was essentially a glorified bulletin board for moms, it has added content and other social-networking tools and games.

For example, it recently launched a blog and content platform named “The Stir.”

Shue and Sanchez said the main CafeMom site now has 7.6 million million unique monthly visitors on its main site and almost 21 million on its overall network of affiliated sites.

The pair said that CafeMom is profitable, with 100 employees. It now has revenue of about $36 million annually.

Here’s the official press release about the Hispanic moms site:

CafeMom, the #1 site for moms with more than 7MM monthly visitors, to launch new website for Hispanic Moms

Outgoing publisher of PEOPLE en Español announced as co-founder.

New York, New York May 4, 2011–CafeMom announced its plans to launch a web destination catering to Hispanic moms in the coming months, to be co-founded by Lucia Ballas-Traynor, a Hispanic marketing veteran and the just-departed publisher of PEOPLE en Español. As part of its market research, CafeMom conducted a major national study of Hispanic moms, across the acculturation spectrum, and found that 92% of Hispanic moms believe there is not currently a website that clearly serves their needs.

“There is currently a huge gap online in serving Hispanic moms,” said CafeMom CEO, Michael Sanchez. “By 2014 one in four moms online will be Hispanic, and advertisers are increasingly looking for ways to reach this key segment. The site represents a tremendous opportunity, both to add value to millions of moms’ lives and to deliver unique integration possibilities to the brands that are most committed to the Hispanic market.”

CafeMom conducted a nationally-representative study of Hispanic moms fielded in both English and Spanish with a well-respected third party research vendor. The study showed Hispanic moms are underserved online, and are also eager to connect with each other. 79% of Hispanic moms said they wanted to connect with other Moms who share their culture, heritage, and life experiences.

Co-founder Lucia Ballas-Traynor brings her 25 years experience in Hispanic media, and has been at the helm of leading Hispanic media brands such as Univision’s Galavision, MTV Tr3s and most recently People en Español, the largest selling Hispanic magazine in the U.S.

“Our plan is to leverage CafeMom’s expertise in community, content, and strategic programs for leading brands and combine it with a world class leadership team that has a deep understanding of Hispanic moms and media,” said Sanchez. “As part of this effort, we are excited to bring Lucia on to the team. She has a proven track record in delivering for consumers and advertisers alike.”

“I’m thrilled to be working with CafeMom on this,” says Ballas-Traynor. “CafeMom is uniquely positioned to deliver this opportunity as an authority on moms. I’m confident that we can create something that will add real value to the lives of millions of Hispanic moms.”

As Web IPOs Heat Up, Prominent Internet Analyst Khan Jumps From J.P. Morgan to Banking at Credit Suisse

Kara Swisher — Wed, 02 Feb 2011 18:38:44 +0000

In yet another sign that the Internet market is getting very interesting to Wall Street, well-known analyst Imran Khan (pictured here) is jumping from his perch as managing director at J.P. Morgan to become a banker at Credit Suisse, according to sources close to the situation.

In this new role, the high-profile Khan–well known for his reports on digital companies–will be running investment banking for Internet markets, including IPOs and M&A.

Khan, who will leave Morgan in several months, is making a big shift from analyst to banker, designed to give Credit Suisse more credibility in the arena as more Web companies come to market.

He also has a strong focus internationally, especially in China, where there has been huge growth of late.

Khan did not return an email and phone call seeking comment, and Credit Suisse has also not responded.

But one industry veteran noted that Khan had the profile and potential–mixing analysis with banking–to be the next investment star, especially as initial public offerings ramp up again.

“In my mind, Imran is certainly as good as Frank Quattrone, said the person, referring to the well-known Silicon Valley banking legend of Web 1.0, who remains active still in dealmaking. “And even stronger in some ways, because of his international and China domain expertise.”

Warning: Oversharing Ahead, as Wall Street Bankers Start to Talk Up Web 2.0 IPOs

Kara Swisher — Tue, 18 Jan 2011 22:50:15 +0000

Here’s the tastiest part of an article in the New York Times yesterday about how Goldman Sachs essentially borked a deal to offer its rich clients in the U.S. private Facebook shares:

“However, over the last two weeks, the companies’ [Goldman and Facebook] relationship has grown increasingly tense, people involved in the offering said. Accusations about the news leak have flown back and forth, these people said.”

You can say that again, but –as leaky as the social networking giant has been over these many years in Silicon Valley–it seemed obvious that most of the intricate financial details about the offering were hand-delivered right from some of Wall Street’s hired guns to the DealBook scribes at the Times.

(Memo to myself: Start kissing up to those bankers, however appalling!)

Unfortunately for Facebook, it was those massive news leaks that drew the attention of government regulators to the deal. And with worries that it veered too close to the edge of violating securities regulations, the U.S. part of the offering had to be pulled.

Despite this particular mess, this kind of mishegas is only going to increase now that the banker bloviating is getting fired up a notch in 2011, as a spate of Web 2.0 Internet companies moves to public offerings.

Along with Facebook, that includes Zynga, LinkedIn and Groupon, as well as several others, all of which are just starting the banker bake-offs that used to be common in the Web space.

And that’s going to mean plenty of information to be found as some of those bankers inevitably drop a dime on the companies they are hired by.

Translated into more modern social terminology that these companies better understand: Bankers are really good at oversharing.

How do I know this? Because that is exactly what happened when the Web 1.0 bubble was in full froth.

Like Christmas in July, as bankers arrived to compete to win IPOs, the information flow suddenly became huge for reporters like me–I was at The Wall Street Journal at the time–covering it all.

It looks like more of the same for this round of stock sales likely to come. Already we know more about Facebook’s financials than we ever did.

And to that, I say: Loose lips may sink ships, but it will make for an awesome amount of news to come in 2011 about the Internet’s starring players.

Russia's DST Out of Twitter Funding Race, With Kleiner Poised to Take the Deal

Kara Swisher — Mon, 06 Dec 2010 19:24:33 +0000

According to sources close to the situation, the aggressive Russian investment outfit DST Global is out of the running to fund Twitter.

Instead, the prize is almost certainly going to Kleiner Perkins, the legendary Silicon Valley venture firm of Web 1.0 that has been making a big push of late into the Web 2.0 market.

The valuation for the new round–which sources said is well above $150 million–will be from $3.5 billion to $4 billion.

And it is not clear if there are any other smaller investors in this funding, but sources said that was likely.

Sources added that the San Francisco microblogging service will be completing its newest round of funding next week, although Twitter might not even announce it publicly.

The new round will be the first in a year for Twitter.

In the fall of 2009, Twitter raised funding at a $1 billion valuation to help spur its growth to its current size of 325 employees, serving its 175 million users.

Such growth was of interest to DST, which has made giant investments in social networking giant Facebook, social gaming rocket ship Zynga and Groupon, the social buying site that recently ended acquisition talks with Google.

Twitter moving into its next phase of development is an attractive target for many VCs, as it seeks a lucrative way to monetize its popular business.

And, in fact, Kleiner star VC John Doerr has been making a big push to be the big investor in this key next round for Twitter, which also has had regular acquisition interest from both Google and Facebook.

What will be interesting to see is if acquisition interest in Twitter from the pair spikes, given the collapse of Google’s attempt to buy Groupon.

The talks with Twitter began, according to several sources, after Kleiner had considered investing in PostUp–the Twitter search engine and advertising platform start-up from Bill Gross’s Idealab, which was first called TweetUp.

PostUp irked Twitter, and its CEO Dick Costolo was particularly vocal about not allowing third-party ad rivals to create a spammier service.

Sources said it was Bill Campbell, well-known Silicon Valley exec and adviser to multiple companies such as Google, who brought Kleiner and Twitter into discussions.

Campbell’s latest coaching task has been at Twitter.

Kleiner has also recently stepped up its Web 2.0 game with the hiring of high-profile Wall Street analyst Mary Meeker of Morgan Stanley.

She has been brought in to help turbocharge the firm’s digital investment portfolio, especially in social, mobile and commerce.

The move has underscored Kleiner’s noisy intent of late to jump into the social Web market.

After scoring a late entry into the scene with its investment in the fast-growing social gaming start-up Zynga, Kleiner has made a big marketing push recently to allocate a dedicated $250 million “sFund” to social start-ups.

NetworkEffect’s Liz Gannes first wrote of Kleiner’s interest in Twitter a week ago, followed by a report a day later in TechCrunch about Kleiner’s primacy in the Twitter funding race and Doerr’s fervent effort to land the investment.

None of the players mentioned here has responded to BoomTown’s request for a comment.

Exclusive: Silicon Valley Go-To Guy Peter Currie Joining Twitter Board

Kara Swisher — Wed, 01 Dec 2010 11:53:56 +0000

According to sources close to the situation, well-known Silicon Valley power player Peter Currie is joining the board of directors of Twitter.

It’s an interesting choice to bring the well-regarded moneyman to the microblogging start-up, and could indicate an intent to push to an IPO eventually.

As first reported by NetworkEffect’s Liz Gannes earlier this week, Twitter is now considering funding offers from big venture funds, specifically Russia’s DST Global and Silicon Valley’s Kleiner Perkins, as well as fielding incoming acquisition interest from Google and Facebook.

Currie should know about this kind of noisy swirl around a hot start-up.

Back in the heyday of Web 1.0, as the CFO of Netscape Communications, he led the iconic browser software company into history, as the first great Internet rocket ship, when it went public on August 9, 1995.

While the Netscape experience ended in tears, Currie’s career has not, and he has become a kind of go-to elder statesman in the Web 2.0 era.

A year ago, for example, he joined Facebook as its temporary CFO.

That move came after the social networking site, in a bit of turmoil, parted ways with its then CFO, Gideon Yu, following mutual disagreements.

Indeed, Currie plays the calm, collected wise man well.

Unusually tall, aggressively avuncular and laid-back, he loves Elvis and enjoys pranking reporters like BoomTown.

(Case in point: Back in the day, he spread the rumor around Silicon Valley that I was short due to a medical condition.)

Now the president of Currie Capital, a private investment firm, he had previously worked at General Atlantic in private equity.

After Netscape, he was a partner and co-founder of the Barksdale Group, an early-stage (and ill-fated) venture capital firm.

Before Netscape, he was CFO of McCaw Cellular Communications and also worked at Morgan Stanley.

Currie is also board-happy, serving as a director of a variety of tech firms, private and public, which have had varying degrees of success.

They have included CNET, Critical Path, Clearwire, Safeco, Ofoto, Tellme Networks and Zantaz, as well as Sun Microsystems.

He has an MBA from Stanford University and went to Williams College.

In other words, just the kind of pedigree needed to give some additional burnish to the Twitter board, which now includes Fred Wilson of Union Square Ventures, Spark Capital’s Bijan Sabet, Benchmark Capital’s Peter Fenton, co-founder and former CEO Evan Williams, co-founder Jack Dorsey and CEO Dick Costolo.

Apparently, it’s time to toss another dude in there!

Hire Like It's 1999: Kleiner's Doerr Finally Lands Meeker After 11 Years of Trying (and It's About Time)

Kara Swisher — Mon, 29 Nov 2010 20:46:25 +0000

BoomTown is showing my age quite a bit today, after I unearthed notes this morning from 11 years ago.

It was for a story I never ended up doing in December of 1999 for The Wall Street Journal–where I was pretty much the only Internet beat reporter for the newspaper in Silicon Valley then–about the possibility that Mary Meeker was considering leaving Morgan Stanley in New York for two hot West coast jobs.

The high-profile Wall Street Internet analyst never made the move back then.

But, at long last, Meeker finally decided today to take one of those offers, joining Kleiner Perkins today as a venture partner in the digital arena.

It’s a much-needed hire by the legendary firm and its most prominent partner, John Doerr, given Meeker’s deep well of experience and the critical need for the still-lagging-behind-hotter-VCs Kleiner to wade more definitively into more current digital trends that she knows well.

For sure, Kleiner dominated Web 1.0 by backing what are now its golden oldies, such as Netscape Communications, Amazon and Google.

But it’s more recent Web 2.0 investments and influence has not been as impressive, especially with regards to its brighter lights and sharper entrepreneurs.

As in: No Facebook. No Foursquare. No Groupon. No Twitter (yet).

To be fair, Kleiner has made some interesting moves–mostly due to its iconoclastic partner Bing Gordon (pictured here)–such as one fund to focus on Apple iPhone and iPad apps and another on social.

And it’s has one big and shiny Web 2.0 bet–which it never fails to point to an awful lot–in gaming phenom Zynga, also courtesy of Gordon.

Bringing on Meeker to add to that now will surely help Kleiner at a critical time, giving it new investment chances, as the digital space shift sharply again.

In an interview with the Journal today, Doerr correctly called the time–a mash-up of social networking, e-commerce and mobile–”a third wave of innovation.”

In a quick interview this morning, Meeker underscored this, noting, “the level of engagement from large companies and the innovation coming from all over Silicon Valley makes this a unique time to invest in and build important companies.”

She said she was attracted to the team at Kleiner to help her move to a new level of expertise and will be spending more significant time in Northern California at her home here.

“This is an opportunity to stretch myself in a great spot at a great time,” said Meeker, noting she was especially interested in the mobile space. “It’s a pretty massive shift going on right now and I wanted to be part of it.”

But a move way back when by Meeker would have been an even bigger deal, since the Web 1.0 was at what turned out to be its peak moment in December of 1999–the ill-fated AOL-Time Warner merger would not be announced for a month, in fact.

And Meeker–who was involved in that deal and most of the other bigs ones, especially the IPOs–was the undisputed “Queen of the Net” from her powerful perch as the top kingmaker on the booming scene.

After working at other firms, she had come to Morgan Stanley as an analyst in 1991, covering PCs, hardware, software and the still nascent Internet scene.

I had met her several years later in a late-night interview in her office in Manhattan, Chinese food included, while I was working on a book on the rising power of AOL.

AOL was one of the many companies she had introduced Wall Street to, and she had become one the key nexuses for all the newly hatched Web players.

For her to leave her job then would have caused reverberations everywhere, since investors far and wide were taking her recommendations on the new companies of the moment, such as Amazon and eBay.

So–while she would later endure negative scrutiny for some of her too bullish cues, after the bursting of the Internet bubble came soon after–nabbing her at the time would be been a very big story.

And who was trying to entice her?

Well, Bill Gross of Idealab for one, offering her the possibility of big IPO stock options (which would turn out to be less than valuable soon after).

Said Gross in an email to me this morning:

Back when we were opening an Idealab office in NY, we wanted to get the best talent in the universe, and that led us right to Mary. She was brilliant and ahead of her time then, as now.

At the time, we talked about working with her to have her insights about industries and companies help us inform the direction our existing companies should take, as well as brainstorm together what new companies to create.

I think Mary was just too happy doing what she was doing, and she went on to have another great 10-year run doing just that!

And the other suitor? That was Doerr of Kleiner Perkins.

A longtime friend and a star venture capitalist whose investments benefited greatly from Meeker’s attention, he had long tried to recruit her.

Fast forward to today, as Doerr seems to have finally sealed the deal.

Meeker’s title at the investment bank has most recently been as its head of global technology research.

At Kleiner Perkins, no surprise, she’ll focus on the firm’s investments in social, mobile and e-commerce, trying to turbocharge its efforts.

Presumably including, as NetworkEffect’s Liz Gannes reported earlier today, Kleiner making a big push to invest in a new badillion-dollar funding round for Twitter.

Meeker’s presence could help there for sure, especially since she has been a big proponent of the microblogging service, as you can see on page 18 of her most recent annual Internet trends report–titled “Ten Questions Internet Execs Should Ask & Answer.”

It’s clear, as you will read below, those are just the kinds of queries Kleiner needs to be making.

Check out her presentation deck for some clues as to where Meeker could focus first as a newly minted VC:

Internet Trends Presentation

ATD Gets Social With Liz Gannes (In Other Words, We Hired Her)

Kara Swisher — Fri, 22 Oct 2010 01:00:01 +0000

A few days ago, All Things Digital announced CNET senior writer Ina Fried was joining the staff to cover mobile for the site.

Today, we complete a one-two punch with the hiring of Liz Gannes, who will be covering the critical social beat.

She comes to us after an impressive stint as a senior writer from the terrific GigaOm Network.

Anyone who follows the development of Web 2.0 and the growing power of social networking–from powerhouse Facebook to the innovative stylings of Twitter to the explosive growth of Zynga–understands the importance of the social arena to the future of the Web.

That was underscored today with the unveiling of a new $250 million sFund by Kleiner Perkins, Facebook, Amazon and others.

Liz will be covering all this and more for us, which we expect her to do with the same kind of professionalism and insight she displayed in spades at GigaOm.

Liz, interestingly enough, was raised in Silicon Valley, and has been wise beyond her years, even as a high school student.

In fact, in an article in the New York Times in 2000 about the corrosive effect of the Web 1.0 culture on young people in the area–called the “affluenza syndrome”–the then-senior at Palo Alto High School said:

“It’s hard to ground ourselves sometimes….The things we hear on the news are happening all around us. We’re living on top of this bubble and we’re not able to see below us.”

We think Liz’s unique perspective will allow readers to see a lot.

After high school and college at Dartmouth, where she got a degree in linguistics, the daughter of a tech-reporter-turned-start-up-CEO–the amazing Stuart Gannes–started her career as a reporter for Red Herring in 2004.

In 2006, Liz founded NewTeeVee, a GigaOM site that is now the pre-eminent source for news and analysis about the intersection of entertainment and technology.

We are thrilled to have her join ATD, especially so since she is coming from a site we admire so much and, more importantly, because of her work for tech’s top-notch blogging pioneer, Om Malik.

And we think once Liz starts chronicling the social arena for us, our readers will have even more to admire in her work.

There are more job announcements to come soon, as ATD expands our coverage, so stay tuned.

The Bay Citizen's Jon Weber–Editor of Web 1.0–Talks About Journalism 2.0

Kara Swisher — Mon, 20 Sep 2010 13:19:39 +0000

It’s been less than a year since the former top editor of the Industry Standard–the once high-flying (and then not so much) magazine of the Web 1.0 era–Jonathan Weber got back to the Bay Area from his stint away in Montana.

His latest job: Editor in chief of the Bay Area News Project, funded with $5 million from the foundation of San Francisco businessman Warren Hellman.

Like ProPublica’s investigative bent in New York, it’s a wealthy-donor-backed, nonprofit endeavor to focus on local news coverage, even as mainstream media outlets founder.

The Bay Citizen also has an agreement to share content with the New York Times (NYT).

The online site’s big stories of late, for example, have focused on the problems at PG&E (PCG), the powerful utility, in the aftermath of the San Bruno explosion.

Here’s Weber–who once chronicled the ups and then downs of the first rash of dot-com fever, and then founded another online news effort, New West–talking about the Bay Citizen, as well as where journalism is going online:

[ See post to watch video ]

Exclusive: Yahoo Eyes CafeMom for $100 Million Acquisition

Kara Swisher — Tue, 17 Aug 2010 17:14:23 +0000

According to numerous sources, Yahoo is eager to close a deal to acquire CafeMom, a social-networking and community site aimed at mothers, in a move aimed at turbocharging its often-meandering strategy in the important women’s space.

The price being offered, said sources, is hovering at $100 million, about the same amount Yahoo (YHOO) recently forked over for Associated Content.

The deal might not happen, of course, but several sources said the pair have been deep in negotiations in recent weeks.

CafeMom, sources said, has wanted to hold out for a higher price of closer to $200 million or more. Other interested buyers include Disney (DIS), sources added.

The New York-based CafeMom has been knocking around for a long time in Internet terms, morphing from a sister company owned by CMI Marketing called ClubMom back in the Web 1.0 days.

CMI, which was founded by Andrew Shue and Michael Sanchez, finally got two big fundings in 2008 totaling $17 million, both from Highland Capital Partners and Draper Fisher Jurvetson.

Sanchez is CEO, but Shue–known for his BoomTown-approved role as the endearingly whiny Billy (But, Alllllliiiisoooonnnn…) on the original “Melrose Place”–is also deeply involved.

On its Web site, the company claims it has 6.7 million unique visitors on its main site and 18.7 million more on its network of affiliated sites, with 100 million page views.

CafeMom said on its Web site that it was profitable, and sources said its revenues were about $25 million to $30 million annually.

Moving from what was essentially a glorified bulletin board for moms, it has added content and other social-networking tools and games.

For example, it recently launched a blog and content platform named “The Stir”–no, really, it is called that.

A recent article on the sassy blog was titled “Parents Who Smuggle Babies Into R-Rated Movies: Ballsy or Crazy?”

(Ballsy, IMHO! You could go crazy enduring only “Cats & Dogs: The Revenge of Kitty Galore,” as I can testify. You need some “Salt” in your diet.)

This kind of content offering is all in Yahoo’s wheelhouse, of course, as it seeks to reinvigorate itself by bringing in new talent and brands.

In the women’s space, Yahoo has its Shine site, which is very pretty but in desperate need of a social boost that CafeMom can presumably provide.

Yahoo’s head of M&A Andrew Siegel–Andrew, don’t be scared of me! Call, I don’t bite! Only rarely, that is!–also reportedly took a strong look at Sugar, an innovative San Francisco women’s site. But the start-up declined to sell.

The women’s market is a big one for advertisers, with many competitors–from iVillage to AOL (AOL) to a recent effort by Demand Media to reach women using a site created with supermodel Tyra Banks.

Yahoo declined to comment, but a PR spokeswoman said in an email that “women are an important audience and our Shine site is very successful.”

Calling from Minneapolis, where he and Sanchez were visiting General Mills (GIS) and Target (TGT) about advertising deals, Shue declined to comment, though very charmingly (and very unlike the mumble-mouthed Billy).

Scott McNealy's Top 15 Reasons He's Surprised We're Celebrating the 25th Anniversary of the Web

Kara Swisher — Thu, 27 May 2010 14:30:16 +0000

Last night, BoomTown headed to San Francisco’s wedding-cake City Hall to attend “The 25 Years of .Com Gala,” which is honoring a quarter-century that I have been jacked into the matrix.

Actually, it’s the 25th anniversary of the .com Internet domain name.

VeriSign (VRSN), which administers the .com registry, sponsored the party, as well as a recent confab in Washington, D.C.

While the growth of .com was slow until the browser became popularized–numbering under 15,000 addresses in 1992–there are now close to 85 million .com domains. This innovative commercial designation is clearly the most important one, both financially and perceptually.

Thus, time to party at an event emceed by Web 1.0 comic favorite Dana Carvey.

He was funny, but perhaps the most enjoyable blast from the past was the appearance of jeans-clad former Sun Microsystems CEO Scott McNealy, who most definitely retains the title of Clown Prince of Silicon Valley as the needler-in-chief of then-dominant Microsoft (MSFT).

After being one of the superstars of Web 1.0, the wise-cracking McNealy has been missing in action in tech of late, as Sun’s influence waned. The company was sold to Oracle (ORCL) recently.

Ironically, given all the hubbub over Facebook’s privacy screw-ups this week, it was McNealy who famously said in a 1999 interview: “You have zero privacy anyway. Get over it.”

For last night’s crowd, he rendered a very adorkable list of the many reasons he was surprised that the .com was getting feted.

Here’s the video:

[ See post to watch video ]

Social E-Commerce Goes Into Overdrive: LivingSocial Raises Another $14 Million

Kara Swisher — Thu, 29 Apr 2010 11:30:29 +0000

Could the social group-buying space get any frothier?

Well, yes, it could.

After the recent $135 million funding of Groupon that valued the Chicago start-up at upwards of an eye-popping $1 billion, rival LivingSocial announced to today that it had raised a more modest $14 million in a Series C round.

The Washington, D.C. start-up had raised $25 million in a Series B venture financing only a month ago. And it raised $10 million on top of that since 2008.

Sources estimated the valuation for LivingSocial is several hundred million dollars now.

The newest round was led by Lightspeed Venture Partners; Earlier investors U.S. Venture Partners, Grotech Ventures and Steve Case’s Revolution are also participating.

Ironically, Case’s former No. 2 at AOL (AOL), Ted Leonsis has been an early investor in Groupon.

LivingSocial said it will use the new pile of cash to expand to dozens of new markets, adding it was launching four new cities now: Portland, Orange County, Charlotte and Philadelphia.

It now operates in 18 cities across the country.

For those in Silicon Valley who do not consider these prices for all these social e-commerce sites high at all, BoomTown is here to tell you that in the real world the figure is not actually modest, except in comparison.

But LivingSocial will need every penny if it is to compete with Groupon and a growing spate of competitors in the local space, much as is also happening in the social status update arena.

The local outcome for most will inevitably be a sale to a big Internet company like Amazon (AMZN).

Or oblivion, especially since so many similar offerings makes the whole market confusing for both local businesses and customers

In general, most offer a daily deal with a huge discount on a wide range of products and services–from spas to skydiving–in dozens of U.S. cities, for large groups of potential buyers on the Web, through email or via social networking sites like Facebook and Twitter.

Using social tools, the idea is use collective buying power to get low prices and push customers to local businesses.

If a deal reaches the number of buyers it needs, which can be in the thousands, these services sell vouchers to the consumers and collect a hefty fee for the sale from the businesses it sends customers to.

The plus for many small businesses is to get a crack at a lot of new consumers–think of it as social networking lead-generation.

This kind of thing has been tried before, of course, centering on consumers who group together to get discounts on items by purchasing in bulk.

In Web 1.0, there were many group-buying sites, most of which failed badly. One of the more high-profile ones, Mercata, received $90 million in funding from investors, including Paul Allen’s Vulcan Ventures.

No matter in 2010!

That’s due to the VC frenzy going on, spurred by winner-take-all theories–Groupon, for example, got most of its recent mountain of cash from champion Russian overspenders, Digital Sky Technologies.

However it turns out, here is LivingSocial’s official press release:

LivingSocial Raises $14 Million Series C Round Led by Lightspeed Venture Partners; Launches in Portland, Orange County, Charlotte and Philadelphia

Company Also Begins Offering Hyperlocal Deals in Seattle Area–Users Can Now Get Deals Even Closer to their Homes

$14 Million Round Comes on Heels of $25 Million Series B Announcement Last Month

Washington D.C., April 29, 2010–LivingSocial, the social commerce leader behind LivingSocial Deals and top Facebook applications Visual Bookshelf and Pick Your Five, today announced that it has completed a $14 million Series C round of venture funding led by Lightspeed Venture Partners, with U.S. Venture Partners, Grotech Ventures and Steve Case’s Revolution, LLC participating. Because of the rapid growth, and high user demand, LivingSocial will use the capital infusion to expand into additional markets–bringing Deals to dozens more cities throughout the U.S. in 2010. This additional funding comes on the heels of the company’s recent $25 million Series B round announced last month.

“We’ve known and admired the LivingSocial team for a long time, and I have bought many of their terrific local offers. They’ve done an excellent job of growing their user base through smart media buying and excellent knowledge of social channels and virality,” said Jeremy Liew, managing director of Lightspeed Venture Partners. “With this financing round, LivingSocial is very well positioned to bring their great offers to even more people.”

LivingSocial is also launching its Deals program in four new markets: Portland, Orange County, Charlotte and Philadelphia. This brings LivingSocial live in 18 cities across the country with major plans to expand to dozens of markets throughout the year.

“We’re constantly receiving requests from our users to expand and launch in their markets, and this recent funding round will allow us to do just that,” said Tim O’Shaughnessy, CEO and co-founder of LivingSocial. “We’re really excited to introduce LivingSocial to Portland, Orange County, Charlotte and Philadelphia to continue generating huge savings for our users and even bigger returns for our merchants.”

LivingSocial users throughout the country saved an average of more than $32 each in March, and have saved tens of millions of dollars since the launch of Deals in 2009. By signing up for LivingSocial’s free daily online service, people are saving an average of 50-70% at their favorite places, such as the hottest local restaurants, spas, sporting events, hotels, and other local attractions.

Because LivingSocial wants to give consumers more availability to the program, the company is launching hyperlocal deals for the Seattle area. Now consumers in areas like Tacoma and Bellevue will start getting deals targeted to their location, in addition to Seattle proper. Hyperlocal deals not only help more consumers explore new things in their city, but these deals also provide merchants with a greater opportunity to reach local audiences on the LivingSocial Deals platform.

LivingSocial is now live in 18 markets including: Washington, D.C., New York City, Boston, Atlanta, Austin, Seattle, San Francisco, Los Angeles, the Twin Cities, Chicago, Raleigh Durham, Denver, San Diego, the San Fernando Valley, Portland, Orange County, Charlotte and Philadelphia. Dozens of additional cities are expected to roll out in the coming months. For more information or to sign up your city, go to http://livingsocial.com.

Groupon Grabs $135 Million From DST and Battery–Valuation Above $1 Billion for Social Buying Site

Kara Swisher — Mon, 19 Apr 2010 02:07:24 +0000

Groupon, the social buying site that has become one of the hotter start-ups of late, has gotten a giant round of funding from the same Russian investors that backed social networking powerhouse Facebook and game phenom Zynga.

Digital Sky Technologies is the main funder of the round, but Battery Ventures is also participating.

The money, the company said, will be used to grow the business–and to speed far ahead of numerous rivals–as well as cash out employees and early investors.

Groupon is profitable and has 270 employees.

In December, Groupon nabbed $30 million in its second round of funding, led by Accel Partners.

The innovative Chicago-based service, which launched only a year ago, previously received $4.8 million in funding from New Enterprise Associates, as well as $1 million from an angel investor.

Groupon features a daily deal with a huge discount on a wide range of products and services–from spas to skydiving–in dozens of U.S. cities, including Chicago, Boston, New York and San Francisco, for large groups of potential buyers on the Web, through email or via social networking sites like Facebook and Twitter.

Using social tools, Groupon–a mashup term for “group” and “coupon”–tries to use collective buying power to get low prices and push customers to local businesses.

If it reaches the number of buyers it needs, which can be in the thousands, Groupon sells coupons to the consumers and collects a hefty fee for the sale from the businesses it sends customers to.

At the cost of discounting and paying off Groupon, small businesses get a crack at a lot of new customers–think of it as social networking lead-generation or perhaps, the “Social Shopping Network.”

Groupon grew out of a project of The Point, an online community launched in 2007 for organizing group action.

This kind of thing has been tried before, of course, centering on consumers who group together to get discounts on items by purchasing in bulk.

But now the group-buying space has been reinvigorated, with a spate of competitors, some of which are clear copycats of Groupon.

Here’s an interview BoomTown did with Groupon CEO and founder Andrew Mason, one of the more affable and level-headed entrepreneurs around–at least until this megafunding. (Don’t go changing, Andrew!)

I have been quite interested in the innovative Groupon, as I said in that post in March:

“The last time I really was truly bullish on a start-up and its founder–BoomTown’s motto is wait-and-see rather than hype-it-up–was AdMob’s Omar Hamoui. That turned out pretty well, with the sale of the mobile advertising site to Google (GOOG) for $750 million last fall. My 2010 start-up that passes the slightly-less-raised-eyebrow test is Groupon.”

Here’s the video interview with Mason:

[ See post to watch video ]

Here’s the official press release:

GROUPON RECEIVES $135 MILLION FROM DST AND BATTERY VENTURES

Investment to Support Rapid Growth of Social Commerce Globally

Chicago/Moscow, April. 19, 2010–Groupon, the leading social commerce site, today announced that DST, a leading global internet investment group, will lead an investment round of $135 million in the Company. A portion of the investment will be used to fuel Groupon’s global expansion, and the rest will be used to facilitate liquidity for employees and early investors.

DST comprises the majority of the investment, with participation from Battery Ventures, which is also a new investor in Groupon.

Groupon leverages group buying and social media to provide its millions of customers big discounts on the best local businesses in more than 50 cities across the United States and in Canada. To date, customers have purchased over four million Groupons on deals ranging from spa treatments and golf outings to fine dining and skydiving and have collectively saved over $150 million on these deals.

“Our growth is a reflection of the positive impact Groupon is having on consumers and businesses at a very early stage of the market development,” said Andrew Mason, founder and CEO of Groupon. “We are very pleased and excited to welcome DST and Battery as shareholders and we look forward to benefiting from their vast knowledge and experience of the social media sector as we continue executing on our growth plans in North America and globally.”

“This investment underscores our view that social networking and community based activity will drive, shape and define the web’s evolution in the years ahead,” said Yuri Milner, Chief Executive of DST. “Groupon, with its strong management team, offering and vision, is pioneering social commerce and is redefining the local advertising space. We look forward to being long-term partners of a company that is on a path to becoming a global Internet leader.”

“We’ve followed the social commerce phenomenon for many years, and are thrilled to have the chance to back such a visionary management team,” said Roger Lee, General Partner, Battery Ventures. “They saw a massive opportunity very early, and have executed flawlessly to define it and take the leadership position. We think there is a lot of runway ahead, and are energized to support the team in their quest.”

Founded in November 2008, Groupon has been aggressively expanding to cities throughout the United States, with plans to be in 100 cities by the end of 2010. Earlier today Groupon announced that it has launched its service in Orlando, Fort Worth, Tucson and Toronto, its Canadian city.

Blue Mountain Arts' Polis of Web 1.0 and His First Year as a Congressman in Web 2.0

Kara Swisher — Mon, 22 Mar 2010 12:18:01 +0000

While in Washington, D.C., last week, one of BoomTown’s last stops was at the office of Colorado Democratic Congressman Jared Polis on Capitol Hill.

Although I usually try to avoid politicians at all costs, it was terrific to check in with Polis, who was one of the more interesting players in the Web 1.0 scene.

His family–the Schutzs–created a pioneering and unusually fast-growing online greeting cards site in 1996, Blue Mountain Arts, inspired by their independent analog company.

In 1999, they sold it to Excite@Home for $780 million, a little less than half in cash, in what turned out to be one of the final bubble deals of that era.

Proof of that: American Greetings (AM) snapped up Blue Mountain Arts for just $35 million in cash in 2001.

By that time, Polis–who decided to use his mother’s maiden name–had involved himself in educational issues in his home state and finally won a seat in Congress in 2008.

Polis, 34, whose entrepreneurial ventures in tech preceded and followed Blue Mountain, talked with me about his first full year in office, which includes a lot less tech focus than you might imagine.

Here’s the video, which includes a tour of Polis’s Congressional office in the Cannon House Office Building:

[ See post to watch video ]

Groupon's Andrew Mason Speaks!

Kara Swisher — Thu, 04 Mar 2010 17:00:03 +0000

The last time I really was truly bullish on a start-up and its founder–BoomTown’s motto is wait-and-see rather than hype-it-up–was AdMob’s Omar Hamoui.

That turned out pretty well, with the sale of the mobile advertising site to Google (GOOG) for $750 million last fall.

My 2010 start-up that passes the slightly-less-raised-eyebrow test is Groupon, a group-based social buying service that nabbed another $30 million in funding in December.

So earlier this week, I sat down with Groupon’s Midwesternly-nice Andrew Mason, 29, to talk about where the start-up is headed with its pile of dough and growing base of consumers who want to make a deal.

The Chicago-based Groupon has actually raised a total of just under $36 million from angels, New Enterprise Associates and Accel Partners so far.

Not that it needs it. The company–like AdMob–is profitable, despite having 200 employees and and a lightning growth path to expand its base of local sites.

The innovative service, which launched only a year ago, features a “daily deal” with a huge discount on a wide range of things–from spas to skydiving and, recently, pole-dancing lessons–in more than two dozen U.S. cities, including Chicago, Boston, New York and San Francisco.

Not everything works–a recent offer of a lobster dinner shipped to buyers was a bomb, as was a tour of Michael Jackson’s childhood home in Gary, Indiana.

The deals are offered to large groups of potential buyers on the Web, through email or via social networking sites like Facebook and Twitter.

Using social tools, Groupon–a mashup term for “group” and “coupon”–tries to use collective buying power to get low prices and push customers to local businesses.

If it reaches the number of buyers it needs, which can be in the thousands, Groupon sells coupons to the consumers and collects a hefty fee for the sale from the businesses it sends customers to.

At the cost of discounting and of paying off Groupon, small businesses get a crack at a lot of new customers–think of it as social networking lead-generation or, perhaps, the “Social Shopping Network.”

Groupon grew out of a project of The Point, an online community launched in 2007 for organizing group action.

This kind of thing has been tried before, of course, centering on consumers who group together to get discounts on items by purchasing them in bulk.

In Web 1.0, there were many group-buying sites, most of which failed badly. One of the more high-profile ones–Mercata–got $90 million in funding from investors, including Paul Allen’s Vulcan Ventures.

But now the group-buying space has been reinvigorated, with a spate of competitors, some of which are clear copycats–which, touchingly, really bugs Mason.

There is even a site, called Yipit, that aggregates all the group-buying sites.

Here’s the video of my interview with Mason at the Accel offices in downtown Palo Alto, Calif., on his second visit to Silicon Valley–as well as a video below it from Groupon about how the service works:

[ See post to watch video ]

Learn How Groupon Works! from The Point on Vimeo.

RealNetworks' Rob Glaser Talks About Giving the Internet a Voice and, Yes, Woolly Mammoths!

Kara Swisher — Fri, 15 Jan 2010 13:20:16 +0000

Rob Glaser (pictured here) called BoomTown when he landed in Washington, D.C., only a few hours after he announced Wednesday he was stepping down as longtime CEO of RealNetworks (RNWK).

Digital Daily reported there was some contention between Glaser and the Real board around his departure from the Seattle-based company he founded 16 years ago, a move that has actually been in the works for some time.

While Glaser did say that he had been through the “most intense two weeks of my life,” leading up to that, he declined to comment more about the specifics of his leaving.

That was fine with me, because–although execs come and go in various and sundry ways–you simply have to give Glaser credit for his pioneering work in bringing both audio and video to the Web.

So Glaser and I talked about this and more, from what he thinks are the key highlights of his Internet career until now to what he plans to do next.

First and foremost, Glaser did “give the Internet a voice,” as I wrote in a 1998 profile of him for The Wall Street Journal about his company’s introduction of its first RealAudio product:

“RealAudio was greeted with more than a little disdain from the Internet elite because it was a tinny and unsatisfying experience for most users. But it gave the Internet a voice, and Mr. Glaser kept plugging away, improving fidelity and striking deals with more content providers to use it on their Web sites.”

Glaser said that was the simple idea behind Real, to “turn the Web from text and static links to a dynamic media space for the mainstream to enjoy.”

That effort began in earnest in the mid-1990s, he noted, by selling “tech enablement,” which simply meant hawking servers and software to companies interested in adding audio and, later, video, to their Web sites.

So successful was Real then that many big companies tried to buy it for huge sums. But ever the aggressive entrepreneur, Glaser never sold–unlike Mark Cuban at Broadcast.com–although many wished he had.

But that was simply not his style, he said; plus, business was booming and it was “like selling pickaxes during the Gold Rush.”

It is an apt metaphor since the next major moment for the company came when the Web 1.0 bubble burst in 2000.

“A lot of great–and also not so great–companies just died,” he said.

To avoid that fate, “We pivoted in a hard way to consumer services and avoided the tailspin,” Glaser added. “It was kind of like when the woolly mammoth evolved into an elephant, while the pterodactyl did not turn into anything.”

That meant creating a variety of consumer-focused media offerings that used Real technology, such as its casual games business and its Rhapsody music service.

Real also shifted its tech licensing business to a carrier services model, Glaser said.

He regularly tangled with Microsoft (MSFT), where he started his career as a very brash 21-year-old. The software giant targeted Real’s business, but also cooperated with the company at times.

And, while the games unit and Rhapsody hit some major bumps, Real did score a whopping $761 million antitrust settlement in 2005 from Microsoft.

But that win was some time ago, and Real idled too much, as did its stock, in the following years, even as Glaser plugged away at creating a variety of new businesses and strategies.

Some were off limits, he said when I asked him why he did not come up with a service like YouTube, given Real’s advantages in video early on, noting that his public company could never had created a service that so antagonized Hollywood partners.

But Glaser did just that more recently with one such innovative idea for a “legal” DVD ripper, called RealDVD.

Though very interesting, RealDVD hit the skids quickly when a federal judge last week dismissed Real’s claims against Hollywood studios seeking to shut down the service before it could be widely distributed.

While that specific defeat was not the reason for his leaving RealNetworks, the idea that it was time to bring new blood to the company finally gained traction with investors, the board, employees and, yes, Glaser too.

What the notoriously hard-charging executive–“My intensity sometimes manifested itself in less positive ways,” Glaser conceded in my 1998 interview with him–will do next is anyone’s guess.

Including his own.

Glaser noted that he would remain chairman of Real, although his day-to-day engagement there is now over.

“It is a big transition for me, because I am closing a chapter I have been in for a very long time,” he said, adding that he would probably do more philanthropic and political work.

(That’s no surprise. After all, Real was once called Progressive Networks, after his liberal politics, and Glaser once had a newspaper column called “What’s Left” while at Yale University.)

Glaser said that on the flight to Washington he thought about the advice Lotus founder Mitch Kapor, one of Real’s earliest investors, gave him when he left Microsoft and was thinking about his next step:

You should take time to figure out what you want to do next and know why you want to do it. Because if it’s successful, once you get going you won’t have time to think through those issues as clearly as you can now.

That’s pretty much been Glaser’s modus operandi over his many years at Real and in the larger Internet space: He pushed his vision of a live Internet forth, he never cut and ran, he never sold, he kept pushing forward.

And you have to admire that kind of gumption, no matter the outcome.

In any case, it is likely Glaser will keep doing so in the years to come.

In fact, pointing out that the movement of entertainment and content online has “come a long way, but still has an even longer way to go,” Glaser started rattling off ideas about where the online media sector needs to go in exactly the same fashion I described a dozen years before.

I described Glaser then as: “speaking in staccato bursts and radiating so much intensity that his face resembles a clenched fist.”

In other words, for all the the lively entrepreneur has been part of as a key pioneer in the development of the Internet, some things will never ever change.

If you want to see Glaser in action, check out these three videos of him, two from the fifth D: All Things Digital conference and one of him talking to me about RealDVD when he introduced it at Demo:

Session interview at D5

[ See post to watch video ]

Demoing RealPlayer 11 at D5

[ See post to watch video ]

Talking about RealDVD

[ See post to watch video ]

Blippy Opens to Public and Scores High-Profile Investors–Including Twitter's Evan Williams–For the Twitter of $$

Kara Swisher — Thu, 14 Jan 2010 14:00:05 +0000

Blippy, a start-up that lets users broadcast their credit card transactions online, will open itself up to the public today and announce a slate of high-profile Silicon Valley investors.

The size of the investment–$1.6 million–is actually not so large as the names on its funding roster.

They include: Sequoia Capital, Charles River Ventures, well-known angel investor Ron Conway, Twitter CEO and co-founder Evan Williams, and a trio of splashy entrepreneurs: Jason Calacanis, James Hong and Ariel Poler.

They are all presumably hoping the site–with the unlikely name of Blippy and headed by longtime Silicon Valley entrepreneur Philip “Pud” Kaplan–will become a viral hit with users and yet another step in the continuing socialization of everything a person does online.

The San Francisco-based company, which has only four employees (including Kaplan, who has also put his own money into the venture), has been in invitation-only private beta for the last several months.

In an interview last night, Kaplan said that the site now has about 5,000 users, accounting for $5 million in purchases in just the past few weeks. An average transaction, according to Blippy statistics, is just above $42.

Kaplan said he hoped Blippy would soon log $1 million in transactions per day.

“We are hoping to create a site that is useful and informative to people, based on a Twitter model of sharing information in an open way,” said Kaplan. “People care about what they spend and we think this is an obvious thing to share.”

Indeed, Blippy takes online transparency even further, allowing a user to automatically post on its Web site messages about the type and amount of the transaction every time they use a credit card–at least the one they designate as their “Blippy” card–for others to see and comment on.

The twist of Blippy–whose motto is: “What are your friends buying?”–is that it is more passive than the more active tweeting or texting.

While most of the transactions don’t contain a lot of information–for example, “cat spent $3.55 at In-N-Out Burger”–Blippy is obviously going for deeper information, which it already collects for sites like Apple (AAPL) iTunes and Amazon (AMZN).

Retailers, restaurants and other vendors might also benefit from the flow of information, finally learning who their best customers really are and perhaps rewarding them.

And, of course, the key part is that your friends see what you are buying and you can all jabber (or gripe) online about what you bought, how much you paid and what you thought of the purchases.

How all this will make money is still being pondered, of course, but one might imagine a dedicated Blippy credit card or some kind of innovative analysis of the spending data or even group-sale offers to users.

And integration with Facebook and Twitter seems inevitable, eventually widening the circle of nosy friends, as does the emergence of reviews, mobile apps, search and more.

Kaplan is best known for a site he created during the Web 1.0 bubble, FuckedCompany, which chronicled the ongoing start-up implosion as it happened.

He later started online advertising service AdBrite, followed by a short stint as Entrepreneur-in-Residence at Charles River Ventures.

It was there that he met Blippy co-founders Ashvin Kumar and Chris Estreich.

Kaplan said the money raised was enough to fund Blippy for the next 12 to 18 months.

But why not hear him talk about Blippy? Here is the video of a BoomTown interview with Kaplan, which I posted in late December:

[ See post to watch video ]

The Beaver Brothers of Zazzle Talk About Customizing, Well, Everything!

Kara Swisher — Thu, 24 Dec 2009 14:00:41 +0000

A few weeks ago, BoomTown motored down to Silicon Valley, to the Redwood City, Calif., HQ of Zazzle, the online site that lets users order a variety of custom products by using a special (and patented) printing technology.

I went to talk to the Beaver brothers–Jeff and Bobby, who founded the company with their father, who is CEO, way back before the first Web 1.0 bubble burst in 1999–about recent changes, including finding more ways to slap custom designs on more products and recent international expansion.

Funded to the tune of $46 million by Kleiner Perkins and Sherpalo Ventures, Zazzle’s profitable business essentially remains pretty straightforward: A customer can pick from both branded and user-generated designs for a variety of items, such as T-shirts, shoes, skateboards and more.

Zazzle also offers a marketplace, under a commission structure, for those who do contribute designs.

But in the video below, the pair talk about the more intriguing and more innovative idea of making pretty much every retail product completely customizable and available on demand.

It’s an interesting idea, to be sure, and probably inevitable.

Here’s the video of the interview, as well as a tour of Zazzle’s offices:

[ See post to watch video ]

Philip "Pud" Kaplan Talks About Blippy–the Twitter of $$

Kara Swisher — Wed, 23 Dec 2009 16:59:37 +0000

To start, let’s just dispense with huffing and puffing angst over whether or not people should broadcast their credit card transactions online.

Because that’s what you can do on a new site, with the unlikely name of Blippy, headed by longtime Silicon Valley entrepreneur Philip “Pud” Kaplan.

Blippy has already gotten a lot of oh-dear attention for its premise, which is yet another step in the continuing socialization of everything a person does–the inevitable trend toward radical transparency online.

Now in invitation-only private beta, the new service sends out messages about the type and amount of the transaction, every time you use your credit card–at least the one you designate your “Blippy” card–for others to see and comment on.

In other words, a kind of Twitter for spending.

The twist of Blippy–whose motto is: “What are your friends buying?”–is that it is more passive than the more active tweeting or texting.

(Presumably someday, your body will tweet from the gym, or while you are sleeping.)

While most of the transactions don’t contain a lot of information–for example, “cat spent $3.55 at In-N-Out Burger”–Blippy is obviously going for deeper information and already has it for sites like Apple (AAPL) iTunes and Amazon (AMZN).

Retailers and restaurants and any vendor might also benefit from the flow of information, finally knowing who their best customers really are and perhaps rewarding them.

And, of course, the key part is that your friends see what you are buying and you can all jabber online about what you bought, how much you paid and what you thought.

How it is all going to make money is being pondered, of course, but you might imagine a dedicated Blippy credit card or some kind of analysis of the data or sale offers to users.

And integration with Facebook and Twitter seems inevitable, eventually widening the circle of nosy friends, as does the emergence of reviews, mobile apps, search and more.

Kaplan came to All Things Digital Worldwide HQ–also known as the cottage behind my house–to chat about all this and more.

He is, of course, best known for a site he created during the Web 1.0 bubble, called FuckedCompany, which chronicled the ongoing start-up implosion as it happened.

Kaplan later started online advertising service AdBrite and was an Entreprenuer-in-Residence at Charles River Ventures for a short time after he left AdBrite.

It was there that he met Blippy co-founders Ashvin Kumar and Chris Estreich. Funding for the trio is forthcoming, said Kaplan.

Here’s Kaplan holding forth in a longish video interview, where we curse and discuss my porn-and-Cheetos spending habits (don’t judge!):

[ See post to watch video ]

And, in the spirit of full transparency, here is Kaplan in two videos on YouTube–in one he is sweetly singing “Easy” with his wife and in the other, he is drumming like a heavy metal lunatic:

Let's Make a Deal! Groupon Nabs $30 Million in Funding

Kara Swisher — Wed, 02 Dec 2009 08:00:19 +0000

Groupon, a group-based social e-commerce buying service, has nabbed $30 million in its second round of funding, led by Accel Partners.

The innovative Chicago-based service, which launched only a year ago, had previously received $4.8 million in funding from New Enterprise Associates, as well as $1 million from an angel investor. NEA participated in this round too.

Groupon features a daily deal with a huge discount on a wide range of things–from spas to skydiving–in 26 U.S. cities, including Chicago, Boston, New York and San Francisco, for large groups of potential buyers on the Web, through email or via social networking sites like Facebook or Twitter.

Using social tools, Groupon–which is a mashup terms for “group” and “coupon”–tries to use collective buying power to get low prices and to push customers to local businesses.

If it reaches the number of buyers it needs, which can be in the thousands, Groupon sells coupons to the consumers and collects a hefty fee for the sale from the businesses it sends customers to.

At the cost of discounting and paying off Groupon, small businesses get a crack at a lot of new customers–think of it as social networking lead-generation or, perhaps, the “Social Shopping Network.”

Yesterday’s deal in San Francisco, for example, was a “restorative massage” at Teashi, cut from $100 to $45. It sold out by 10:47 pm with 1,000 buyers.

Groupon is profitable and has about 125 employees.

The start-up plans to use the money it has raised for increased customer acquisition, as well as expansion to more cities and improvement of its technology.

As part of its funding, Palo Alto, Calif.-based Accel’s Kevin Efrusy has joined Groupon’s board of directors.

Groupon grew out of a project of The Point, an online community launched in 2007 for organizing group action.

This kind of thing has been tried before, of course, centering on consumers who group together to get discounts on items by purchasing them in bulk.

Here is the official press release:

Groupon Raises $30 Million Round Led by Accel Partners with NEA
to Support Rapid Growth of Social Commerce

CHICAGO–Groupon, the social commerce service that has saved consumers in cities across America more than $36 million since its launch 12 months ago, has raised a $30 million round of capital led by Accel Partners with participation from Groupon’s initial investor, New Enterprise Associates. The financing will be used to accelerate Groupon’s customer acquisition, expand into new geographies and further develop its technology.

Groupon leverages group buying and social media to provide its millions of customers big discounts on the best local businesses in major cities such as Chicago, Boston, New York City, San Francisco, Atlanta and Washington, D.C. To date, customers have purchased over 800,000 Groupons on deals ranging from spa treatments and golf outings to fine dining and skydiving.

“We’re proud of the positive impact Groupon is having on consumers and business owners,” said Groupon founder and CEO Andrew Mason. “Groupon is pioneering a new category, and we believe adding Accel’s experience partnering with digital and social media companies together with NEA’s depth in the area will help us reach our full potential.”

“The social graph is laying the foundation for a new generation of industry-defining Internet companies, and Groupon has effectively invented social commerce,” said Kevin Efrusy, Partner at Accel Partners. “Andrew and the Groupon team are executing with incredible focus at a breakneck pace and are delighting both their merchants and customers.”

About Groupon

Groupon, launched in November 2008 in Chicago, features a daily deal on the best stuff to do, eat, see, and buy in 26 major cities across the United States, including Chicago, Boston, New York City, San Francisco, Atlanta and Washington, D.C. Groupon uses collective buying power to offer unbeatable prices and provide a win-win for businesses and consumers. The social commerce service is a project of The Point (http://www.thepoint.com), an online community launched in 2007 for organizing group action. Groupon plans to be in 30 cities by the end of 2009.

For more information, visit http://www.groupon.com.

To get Groupon’s daily free email for the best in your city, subscribe at http://www.groupon.com.

To learn more on how to become a featured business on Groupon, visit http://www.grouponworks.com.

To see some of Groupon’s top-performing deals, visit http://www.groupon.com/chicago/deals

AOL to Spin Off Dec. 9, Begin Trading Dec. 10 (Plus Full Press Release)

Kara Swisher — Tue, 17 Nov 2009 00:01:57 +0000

AOL will officially be spun off from Time Warner on Dec. 9, with trading to begin the next day.

Shareholders of record at 5 pm ET on Nov. 27 will get one share of AOL for every 11 shares of Time Warner (TWX) on the day of the long-expected spinoff of the Internet service.

At Time Warner’s current market cap of $38 billion, that gives AOL an implied value of $3.2 billion–a fraction of Google’s (GOOG) $20 billion valuation of the portal in 2005, when it invested $1 billion in the property. And it’s even lower than the $5.5 billion valuation Google gave the company last January, when it wrote down its investment.

AOL will trade on the New York Stock Exchange as “AOL.”

Ironically, before it merged with Time Warner at the dawn of the new century, AOL previously traded on the NYSE.

AOL went public on Nasdaq on March 19, 1992, under the ticker “AMER,” and moved to the NYSE on Sept. 16, 1996 trading as “AOL.”

(Fun fact: BoomTown actually attended both the fancy dinner the night before AOL moved to the NYSE from Nasdaq and the AOL party on Wall Street the next day.)

If you want to get really technical, AOL common stock will begin trading on a “when-issued” basis–you really don’t want to know the confusing regulatory details of why–on the NYSE under the symbol “AOL WI” beginning on Nov. 24, 2009.

On Dec. 10, when-issued trading of AOL common stock will end and “regular-way” trading under the symbol “AOL” will begin.

After that, it will be up to CEO Tim Armstrong to make the long-suffering AOL into the little Internet company that could.

The separation of AOL and Time Warner is also symbolic, dismantling the most potent symbol of Web 1.0, when AOL essentially got control of the media giant, only to see the merger crash in disaster.

If at first you don’t succeed…

Here’s the full Time Warner press release on the transaction:

Time Warner Declares Spin-off Dividend of AOL Shares

Record and Distribution Dates and Final Distribution Ratio Announced

NEW YORK–(BUSINESS WIRE)–Nov. 16, 2009–Time Warner Inc. (NYSE:TWX) and AOL Inc. today announced the timing and details regarding the spin-off of AOL from Time Warner.

The Time Warner board of directors has approved the final distribution ratio and declared a pro rata dividend of the shares of AOL common stock owned by Time Warner that will result in the complete legal and structural separation of the two companies.

On the distribution date of December 9, 2009, Time Warner stockholders of record as of 5 p.m. on November 27, 2009, the record date for the distribution, will receive one share of AOL common stock for every eleven shares of Time Warner common stock they hold.

Fractional shares of AOL common stock will not be distributed to Time Warner stockholders. Instead, the fractional shares of AOL common stock will be aggregated and sold in the open market, with the net proceeds distributed pro rata in the form of cash payments to Time Warner stockholders who would otherwise be entitled to receive a fractional share of AOL common stock.

No action or payment is required by Time Warner stockholders to receive the shares of AOL common stock. Stockholders who hold Time Warner common stock on the record date will receive a book-entry account statement reflecting their ownership of AOL common stock or their brokerage account will be credited with the AOL shares. An Information Statement containing details regarding the distribution of the AOL common stock and AOL’s business and management following the AOL spin-off will be mailed to Time Warner stockholders prior to the distribution date.

The AOL spin-off has been structured to qualify as a tax-free dividend to Time Warner stockholders for U.S. federal income tax purposes. Cash received in lieu of fractional shares, however, will be taxable. Time Warner stockholders are urged to consult with their tax advisors with respect to the U.S. federal, state, local and foreign tax consequences of the AOL spin-off.

Shares of Time Warner common stock will continue to trade “regular way” on the New York Stock Exchange (“NYSE”) under the symbol “TWX” through the distribution date of December 9, 2009, and thereafter. Any holders of shares of Time Warner common stock who sell Time Warner shares regular way on or before December 9, 2009, will also be selling their right to receive shares of AOL common stock. Investors are encouraged to consult with their financial advisers regarding the specific implications of buying or selling Time Warner common stock on or before the distribution date.

AOL common stock will begin trading on a “when-issued” basis on the NYSE under the symbol “AOL WI” beginning on November 24, 2009. On December 10, 2009, when-issued trading of AOL common stock will end and “regular-way” trading under the symbol “AOL” will begin. The CUSIP number for the AOL common stock will be 00184X 105 when regular-way trading begins.

Time Warner and AOL have entered into a Separation and Distribution Agreement and several other agreements related to the AOL spin-off. The completion of the AOL spin-off is subject to the satisfaction or waiver of a number of conditions, including the Registration Statement on Form 10 for the AOL common stock being declared effective by the Securities and Exchange Commission (“SEC”), the AOL common stock being authorized for listing on the NYSE and certain other conditions described in the Information Statement included in the Form 10 and in the agreements filed as exhibits to the Form 10. The condition relating to the authorization of the AOL common stock for listing on the NYSE has been satisfied, and today AOL sent a letter to the SEC requesting that the Form 10 be declared effective. Time Warner and AOL expect all other conditions to the AOL spin-off to be satisfied on or before the distribution date.

Silicon Valley Entrepreneur (and Google Exec) Joe Kraus Moves to Google Ventures

Kara Swisher — Tue, 03 Nov 2009 13:14:31 +0000

Joe Kraus–the longtime Silicon Valley entrepreneur who sold his most recent start-up, JotSpot, to Google in 2006 and has been a director of product management since–has moved to its Google Ventures unit as a partner, said several sources.

Sources added that Kraus (pictured above) is likely to be the first of several well-known appointments at the relatively new venture arm of the search giant.

Google (GOOG) announced its VC play in March and said the fund will invest $100 million in “exceptional” start-ups over the next year.

“We’ll be focusing on early stage investments across a diverse range of industries, including consumer Internet, software, clean-tech, bio-tech, health care and, no doubt, other areas we haven’t thought of yet,” Managing Partners Rich Miner and Bill Maris explained in a blog post when Google Ventures debuted. “Central to our effort will be our fellow Googlers, whom we view as a critically important resource to help educate us about potential investments areas and evaluate specific companies.”

Well, that now apparently means Kraus, a serial entrepreneur who co-founded the Web 1.0-era Excite portal and, in Web 2.0, JotSpot, which made wiki-style software for online collaboration.

Currently, only Miner and Maris are listed on the bios page of Google Venture’s online site.

Since the acquisition, Kraus has been leading Google’s OpenSocial efforts to develop standards for social networking platforms.

Please see this disclosure related to me and Google.

Yahoo's Yodel Anecdotal Blogger Will Not Be Yodeling Anymore

Kara Swisher — Sat, 31 Oct 2009 06:49:03 +0000

While Nicki Dugan (pictured here) was not one of the top execs at Yahoo, she certainly is typical of many at the company who stuck with it through many ups and downs.

No longer, according to a memo BoomTown obtained from several sources, since the longtime PR staffer–who has been at Yahoo (YHOO) for almost a decade and who was previously with an outside public relations firm that worked for Yahoo–will leave the company Monday.

Dugan has a high-profile role at Yahoo, running its Yodel Anecdotal corporate blog and penning most of the pieces on it.

It’s not clear from the memo where Dugan is headed, though the memo is full of interesting “moments” she had while at Yahoo and includes some nice historical details (including a scoop I had from Web 1.0 that I had long forgotten).

Here’s the email she sent to colleagues:

From: Nicki Dugan
To: XXX
Cc: Nicki Dugan
Sent: Thu Oct 29 16:35:22 2009
Subject: Fare thee well

Hiya:

After almost exactly 9.5 years, 10 Oktoberfest mugs, 9 founder holiday gifts, 4 cube moves, and 76 daily miles, I’ve decided to hang up my purple badge. Saying goodbye to Yahoo!–and all of you–is no easy task. It’s a rare place that can capture your heart and soul and hang onto it for about a quarter of your life. What’s made Yahoo! so special? I thought I’d rattle off some of my favorite moments:

* Jerry asking me (on my first day) if the PR team really needed another person

* Filo’s all-worldwide “get back to work” Yahoo! Greeting during my first week

* Yahoo! Surfers. Full stop.

* Risking life and limb to cross the street for a meeting when our HQ was on Kifer Road in Santa Clara

* My first earthquake, experienced working on a Saturday in Building D

* When our various business units were called “pods” (communications, communities, commerce, content)

* Our former general counsel propping his cowboy boots up on the conference table during a USA Today interview

* When Jerry and David taught Madeleine Albright how to surf the Web

* When In & Out Burger trucks provided meals during summer picnics

* Launching the world’s first Internet taxi

* When NASDAQ halted YHOO trading after Jim Hu and Kara Swisher caught wind of our Broadcast.com acquisition

* “Sleeping” under my desk the night before Analyst Day 2001 as lawyers and the deal team haggled sentence structure with SBC in our joint release

* When the cow from our lobby attracted Mennonites at NYC’s South Street Seaport

* Terry Semel doing earnings calls in his socks

* Being the stage photographer for Beck at Open Hack Day 2006

* Getting Jerry & David to sumo wrestle in the name of fighting climate change (http://bit.ly/2NIjkO)

* Tom Cruise recreating the Oprah coach moment during his Yahoo! Influentials visit

* Convincing Matt Dillon that our contract trumped his hangover at the Greenest City in America press conference in Times Square

* Flying to Burbank via a NetJet with every C-level Yahoo! executive for the Overture acquisition

* When Sue Decker rode into an all-hands at URLs on a Harley Davidson

* Meeting Al Gore at a private “An Inconvenient Truth” screening with the Yahoo! For Good team

* Breaking the world record for largest simultaneous yodel…and getting ordinary Americans to yodel their hearts out in NYC, SF and Seattle for the Yodel Challenge and Yodel Studio

* Watching mobs of Yahoo! users line up outside Baskin-Robbins stores across the country for free ice cream on our 10th anniversary

* Having Michael Arrington leave the third comment on Yodel Anecdotal when we launched (and a positive one at that!) (http://bit.ly/1Lvzrx)

* The emotional weekend spent at Skadden as we prepared to announce Terry’s resignation

* Learning how to play Faceball at Flickr HQ (http://bit.ly/4mdJ24)

* Getting Blake Jorgensen to pull off the best April Fool’s video… Evar

* Stuffing cotton into Filo’s cheeks for his cinematic debut as Don Corleone in Ari’s tech team video

* Asking Ash to dress in an orange jumpsuit to pick up trash in Filo’s cube (I’ve clearly abused Filo extensively)

* Dressing in black and leaving rubber duckies all over Google’s campus at dawn (10K+ photo views! http://bit.ly/vX8hA)

* Convincing 33 Yahoo! teams to dance with Matt “Where the Hell is Matt?” Harding all over our HQ during the Summer of Microsoft (http://bit.ly/929hT)

* Getting the Food Network to produce a “Dinner: Impossible” episode for Yahoo!’s Search’s anniversary and watching Chef Robert Irvine abuse Tuoc and Raj in the kitchen (http://bit.ly/291zsB)

* Carol’s first all-hands F-bomb

We played hard, worked harder, and drank copious amounts of purple Koolaid. And I’ll probably never quite get it out of my system. Working here through so many of Yahoo!’s phases has been a once-in-a-lifetime opportunity. I’m so grateful for the memories and friendships built over these many years. I look forward to watching the ‘hoo from afar.

If we don’t connect on Monday for a final farewell, please keep in touch. Employee #370 (adjusted hire), over and out.

–Nicki

Here’s a link to one of my favorite blogs by Dugan, which she referenced above, on dancer Matt Harding, with a video below she did by dragging him to do jigs all over Yahoo:

[ See post to watch video ]

Exclusive: CBS Digital CEO Smith to Leave to Start a Silicon Valley Advisory Firm (First Customer? CBS)

Kara Swisher — Wed, 28 Oct 2009 17:00:25 +0000

Quincy Smith, the high-profile CEO of CBS Interactive, is planning on leaving his job at the media giant in January to start an advisory firm in Silicon Valley, according to several sources.

But, in an interesting twist, Smith (pictured here) will remain an adviser to CBS (CBS) under a multiyear contract, sources added, making it his first client.

UPDATE: CBS confirmed the move BoomTown earlier reported, in a press release below.

Apparently, Smith will focus intently on video monetization, authentication and other digital issues for the company. CBS is calling it a “transition to a new role,” in its official statement.

CBS Interactive President Neil Ashe will take over Smith’s duties, but without the CEO title, which was a relatively new one for Smith.

CBS is television’s most popular network again this season and its interactive properties are among the top ten in aggregate in both traffic and video.

“I’m very pleased to extend our relationship with Quincy, who is one of the finest minds working in Interactive media today,” said Leslie Moonves, president and CEO of CBS Corporation, in a statement. “Quincy helped put CBS Interactive on the map and we are now a Top 10 presence in premium content.”

Said Smith: “It’s a huge honor to count CBS as my first client. In three years, this company has grown its Interactive profile immeasurably, and yet there is so much more to be done. I love CBS and its people and I look forward to working closely with them to help CBS become the premier video content company, regardless of platform or screen.”

MediaMemo’s Peter Kafka wrote in May about the possibility of Smith departing CBS, where he has worked since late 2006.

As Kafka wrote, Smith has long wanted to start a new media consultancy and has also wanted to return to Silicon Valley.

In fact, the man BoomTown has dubbed the “Energizer Bunny of the Web” was an early employee at Netscape Communications in the Web 1.0 heyday, tried his hand at venture capital and worked on tech deals for media banking firm Allen & Co.

At CBS during the Web 2.0 era, Smith has been aggressively guiding the company into a series of transactions, including the $280 million acquisition of Last.fm in 2007 and the $1.8 billion purchase of CNET last year.

Smith has also been involved with digital issues related to CBS’s strong television assets. He has championed–unlike other media giants–widely distributing CBS content online and keeping control of its advertising sales.

People close to Smith say he often talks of trying to emulate Dan Case, the late brother of AOL founder Steve Case and the former CEO of Hambrecht & Quist, one of the more influential among Silicon Valley investment banks during the first Web boom.

Sources said that the time has now come and that the move is expected to be announced very soon.

It is also likely that Smith’s top business development exec at CBS, Mike Marquez, will also leave to join him at the still unnamed firm.

BoomTown suggestion for a name: Q 3.0.

Here’s Smith in a cameo for a video spoof after he paid $5 million for Wallstrip, the funny business video site which has since been severely sidelined:

QUINCY SMITH SIGNS MULTI-YEAR ADVISORY AGREEMENT WITH CBS CORPORATION

CEO of CBS Interactive to Depart in January 2010 but Will Continue Working with Company on Video Content Monetization, Among Other Projects

CBS Corporation announced today that Quincy Smith, Chief Executive Officer of its CBS Interactive division, will transition to a new role with the company beginning January 2010 as he starts an independent advisory business. In this new role, Smith will advise CBS on strategies and opportunities for growth across the Company’s interactive businesses. Smith, who had led CBS Interactive since November 2006, will remain with CBS Corporation as the division’s CEO through the end of 2009. Neil Ashe will continue as President of the division.

Smith will continue to be closely involved in CBS’s initiatives related to next-generation monetization of video, including oversight of the Company’s effort to explore authentication as a new, additive method of distribution. He will also advise on partnering with technology companies to expand CBS’s interactive presence, as well as explore new growth opportunities related to content, services and applications.

“I’m very pleased to extend our relationship with Quincy, who is one of the finest minds working in Interactive media today,” said Leslie Moonves, President and CEO of CBS Corporation. “Quincy helped put CBS Interactive on the map and we are now a Top 10 presence in premium content. His entrepreneurial spirit and his passion for the business have helped this Company attract some of the most creative minds working in digital media. I know he will continue to be successful in all he’s yet to do, and we’re very happy to have Quincy working with us in this new role at CBS.”

“It’s a huge honor to count CBS as my first client,” said Smith. “In three years, this company has grown its Interactive profile immeasurably, and yet there is so much more to be done. I love CBS and its people and I look forward to working closely with them to help CBS become the premier video content company, regardless of platform or screen. I especially want to thank Leslie for his leadership and counsel, and for giving me this opportunity to continue working with CBS.”

Smith came to CBS Interactive in 2006, and in three years helped build a division that has become a top ten property in terms of worldwide visitors and video views. CBS’s acquisition of CNET in 2008 added industry-leading Web sites like CNET.com, GameSpot, TV.com, chow.com and BNET.com to a portfolio that had already included top ranking properties like cbs.com, cbssports.com and last.fm. Today, CBS Interactive sites span nearly every category of premium content on the Web, across news, sports and entertainment.

Previously, Smith was an executive with Allen & Company, where he was involved with multiple transactions and advised companies such as Comcast, Google and CBS. Prior to Allen & Company, Smith was a Founding Partner of The Barksdale Group, a venture capital firm. Previously, Smith spent five years at Netscape where he ran Investor Relations and Corporate Development and played a role in over 20 joint ventures, investments and acquisitions including Netscape’s ultimate sale to AOL. Prior to that, Smith was an investment banker for Morgan Stanley.

eBay Bids to Fix a Security Hole

Peter Kafka — Tue, 11 Aug 2009 15:47:47 +0000

See? You don’t just have to be a buzzy social network to suffer through security problems. You can be a relatively staid Web 1.0 giant, too. eBay (EBAY) is warning developers who build programs that incorporate the online marketplace’s engine about a security breach.

In letters to sent Monday to 90,000 developers who work on eBay’s Developers Program, the company warns about a security hole that could cause problems, but hasn’t yet. It also takes pains to point out that the security flaw doesn’t affect eBay customers themselves. eBay says third-party software now accounts for 25 percent of its listings.

An eBay spokesman tells me that eBay came across the weakness itself not because a hacker had exploited it, and that the company is acting “out of an abundance of caution,” which is a term the eBay folks seem to favor (see email text below). “The information that *may* have been compromised consisted of basic contact information that could potentially be used in a phishing attack. At this point, we have not identified any unusual patterns in our developer accounts and we are notifying them and requesting they change their developer passwords out of an abundance of caution [sic].”

Here’s the complete text of eBay’s heads-up letter:

Hello [redacted], this is Kumar Kandaswamy, and I manage the eBay Developers Program. I’d like you to read this important message about account safety. The safety and security of the eBay Developers Program is a top priority. While we believe that people are basically good, we also must live with the reality that there are fraudsters out there who have made it their illicit “profession” to find ways to exploit others on the Internet.

Occasionally, fraudsters attempt to gain unauthorized access to the eBay Developers Program. eBay has recently identified a means by which someone could gain access to eBay Developers Program account information. This type of access DOES NOT allow the capture of financial or other sensitive information, such as credit card or bank account information or Social Security numbers.

Fortunately, we have not detected any unusual activity with any Developer account. Out of an abundance of caution and to help ensure the security of the eBay Developers Program, we are requiring that all developers take the following steps:

* Take advantage of our new, stricter password standards and change your eBay Developers Program (developer.ebay.com) passwords. It is not necessary to change eBay (www.ebay.com) passwords. If you believe you or your customers have been the victim of fraudulent activity, contact us immediately at apifeedback@ebay.com.

Sincerely, Kumar Kandaswamy

New VC Marc Andreessen Speaks About Going to the "Dark Side" and More!

Kara Swisher — Mon, 06 Jul 2009 04:00:22 +0000

It’s finally official: Marc Andreessen has crossed over to what he once called “the dark side” and is now a venture capitalist.

Several weeks ago, BoomTown broke the news that the Silicon Valley legend and serial entrepreneur (pictured here) and his longtime investing partner, Ben Horowitz, had completed the raising of $300 million for a new venture fund.

And, indeed, the new firm–which is made up of just the two of them–is now launched and called Andreessen Horowitz. It has $50 million over the $250 million the pair had initially planned.

In an interview with me last week, 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.

That will mean about 60 to 80 seed investments, 15 that need following rounds and two to three late-stage companies.

In addition, the firm is able to take large equity stakes in public companies.

“We are unafraid of investing in 400 people instead of 40 people,” said Andreessen. “And we could invest $50,000 to $50,000,000.”

He noted the new firm would aim for areas the founders were more familiar with, such as the consumer Internet and mobile.

One certainty, though, was that the firm would focus on companies led by tech-savvy founders.

“We believe in entrepreneurs and those who live and breathe the tech product that they have created,” said Andreessen.

Andreessen said several major institutional investors–universities, for example–have invested large chunks in the fund, while a spate of tech luminaries has put in smaller amounts.

The quick completion of the fund raising, in the midst of a national econalypse, is a good sign. But the reputation of both longtime entrepreneurs seems to have helped.

Andreessen co-founded Netscape–the iconic browser company that was key to introducing the modern Internet to consumers in Web 1.0–and a lot of other start-ups.

He has also morphed into a mentor to many Web 2.0 entrepreneurs.

Andreessen made news when he announced on the “Charlie Rose” television show in February that he was creating the new fund.

“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.

Andreessen said 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 start-ups, such as Twitter, Aliph, Digg, LinkedIn and many more.

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

Now, as a VC, he is upping the ante. “It’s important to have more capital,” he said. “Sometimes having a huge checkbook is a great thing.”

But, more important, he said, was to develop a knack for investing in successful companies with a fearlessness he said he learned from well-known VC John Doerr.

“John is always swinging for the fences,” said Andreessen. “I want to get into a cycle of backing radical ideas.”

Here’s a video interview I did with Andreessen about his new venture firm:

[ See post to watch video ]