Tech Coast Review
The startup and tech news weblog for Southern California
Showing posts with label VC funding. Show all posts
Showing posts with label VC funding. Show all posts

Tuesday, February 12, 2008

Last week Santa Monica based announced that the received an undisclosed investment from General Catalyst Partners.  The site is basically an aggregation service for "how-to" type videos.  Apparently self-help 2.0 sites are all the rage right now, as TechCrunch just covered yesterday First30Days (not socal based) which similarly focuses on positive self help articles during "the first 30 days of a major life change".  And while the two companies don't exactly overlap, being funded at the same time, does imply that the venture community is recognizing the value in sites that focus on the self help niche.

So how is  It's actually pretty cool, and they definitely index a lot of content.  I ran across a few bugs while using the site, but nothing show stopping, and overall I was impressed with how thorough the indexing/aggregation of their content was.  
So far in the recent months since the site has launched, Wonderhowto hasn't garnered much traffic yet, but the NY Times recently did a profile of
 them (and their excentric founder), so maybe they'll pickup steam.  On the otherhand picking up steam maybe harder for this type of business, because although clearly their is a huge market for self-help related stuff (just browse a bookstore to see how much we Americans gobble the stuff up), the videos and Wonderhowto itself is not nearly as viral as other video sites.  Because lets face it, as lame as some stupid funny stunt video on Youtube is, people love to forward them around and thus they get a lot of play.  Companies like do really well with that.  But Wonderhowto doesn't have that growth advantage, I mean, who forwards how-to videos? 

 Of course the founder of Wonderhowto is known for his antics, so maybe we'll see some unuasual marketting strategies from his team to gain the viral traffic that they want.  And because of that, I'd be surprised to see Wonderhowto not pickup some decent traction.  Though I do have to say, guys couldn't you have picked a shorter name?



Wednesday, January 30, 2008

Santa Monica based shopping 2.0 site, ThisNext, recently received another 5M in a series B round from their previous investors Clearstone Venture Partners and Anthem Venture Partners (according to Techcrunch) .  This backs up their Series A round of 3.5M.  They also may raise another 2-3M in debt financing (according to socalTECH).

We have already profiled thisnext here, and the general mixed review still stands.  They've also received mixed reviews from others, so the real question is whats up with total 11 Million+ these guys could potentially be sitting on?  Apparently its for growth capital and more employees, but geez it seems like a crazy burn rate to me.  Sure they have steady traffic growth, but I'm still not convinced they are doing anything so revolutionary to justify the valuation.  Much like mahalo, I think these guys are probably just doing well making the funding rounds because of their connection with Jason Calacanis.  Sometimes I wonder if VCs just seem to throw gobs of money at companies connected with serial entrepreneurs, and throw out the level of scrutiny they extend to unproven startups.  In many ways, this is a shame, serial entrepreneurs many times have mediocre ideas the second time around, whereas there are many good startups that struggle to get funding because of their inherent unproven nature.  And while understand the value of mitigating risk, the current trend of extending strong funding to serial entrepreneurs because of their track record, not their idea, maybe tipping the risk balance the wrong way. 


Tuesday, January 15, 2008

San Diego based startup company ProQuo today announced 8M in Series B funding (after receiving a $5M round last year) by Mission Ventures and Draper Fisher Jurveston.  So what are they doing with all this funding, dealing with email spam?  Nope, actually they are using the Internet to kill snail mail spam.

The Good
Their getting rid of junk mail, thats about as good as it gets!  
Basically you get presented a bunch of things that you get put on mailing lists for (coupons, credit cards, catalogs, etc.), and mostly all you have to do is click on the ones you dont want sent to you anymore and ProQuo handles the rest. In a few cases, ProQuo, can't automate it, so they give you instructions on what you need to do manually.  But either way, at the end of ProQuo session, you are pretty much guaranteed to get rid of a lot of that junk in you mailbox.

The Bad
Well there isn't a whole lot of bad things to talk about with ProQuo, they are free and they are providing a great service for consumers.  The one thing to point out is maybe the irony of their revenue model.  Like many free Internet services they are advertisement driven, which is kind of funny considering their company is about getting rid of advertisements in you mail.  Frankly though I'd rather see a few ads on the side of a website then a bunch of crap in my mailbox thats not only annoying me, but also killing trees for no good reason.

Only good things to come for ProQuo.  With the added capital, it will be interesting to see how they continue to expand their service.  They have already been well covered in the press and high profile blogs and they are picking up traffic and customers fast, so now its just a matter of sitting back and watching these guys grow.  


Wednesday, January 2, 2008

Today 10 year old (based in Santa Monica) announced that they received a $7M venture backed loan from ORIX Venture Finance. 

For those not familiar with a venture debt deal, it is sort of (in simplified terms) a cross between a bank loan and traditional venture capital round.  Anyways, one would hope that with the additional money, can now afford/find the time to update their site.  While has successfully survived the first bubble, it remains to be seen if they can get competitive in this new bubble, as user generated content sites like (seen on this graph)  are kicking old's butt.  While once was at the cutting edge as the shopping portal for cooking related things, it has long been passed up by sites that have more sticky content like recipes, reviews, etc. At this point, is most successful with its private label and partnership agreements (sporting big names like, Starbucks, Pillsbury, and Betty Crocker).  According to Venture Beat, expanding this private label is a big part of what they are getting the funding for.  Considering that they've already received over 100M in funding, and this new round is debt financed (harder to get) its likely they are profitable, and see additional business opportunity in expanding their private label services.  Of course while this may be true, it'd be nice to see them throw some money at the core brand as well, by adding more community features to bring's main site into the 21st century.


Tuesday, December 11, 2007

Apparently Hulu is what you get when two of the major networks (NBC Universal and News Corp) get 100M to build a next gen Internet TV platform.  Hulu is well situated in the hub of the media industry basing itself in the center of Los Angeles.  Much like Gmail was for a long time, Hulu is currently in private beta, you need an invite to get access to Hulu.  Though again like Gmail if you really want access, invites aren't that hard to come by.

Once you do get into Hulu you might be surprised because it is considerable slicker, then TV viewing through the normal website of the various networks.  They are even beginning to add HD content, which is pretty cool in my book.  With over 100 programs offered from 15 TV stations they are off to a pretty good start with content.  Not every show has every episode available, which is annoying, but I'll cut them some slack since its still in private beta.  

One of the things that impresses me about Hulu, is that its a good show of faith that the entertainment industry is trying to adapt their business model around new channels as opposed to just fight it.  While nobody likes, watching ads, they are an important way to monetize content, and thus one of the primary mechanisms for entertainment types to get paid.  For a while, now there has been this fear that if you allowed people to share content, then you lost control of advertising.  Yet Hulu handles this issue quite well because they allow you to embed the tv shows outside of Hulu's main site, but there still is scheduled advertisement pauses so everyone gets paid, regardless of whether the video is embedded offsite or your watching it on  That seems fair to me, and as a consumer I can accept that.   Besides the inability to download to my ipod or whatever, they don't restrict where I can share Hulu videos online, and that freedom coming from a major network is a good step.

Of course its not all rosey pictures in the land of Hulu.  First off I hate the name (and a funny anecdote is that it means cease and desist in swahili).  And I really wonder about why the investment dollars were in the 100M range.  It seems the networks could have done something similar on their own site (in fact they sort of already do) for far less money.  Obviously everyone wants to compete with Youtube and Itunes as being sort of a universal place to distribute content, but I still think in some ways this was all overplayed a bit.  

In the end though Hulu is a step in the right direction by the big boys, and its good to see them trying to embrace the direction of technology.  In some ways just getting major organizations like NBC Universal and News Corp to both agree on the vision is pretty amazing.

If you want to see more screenshots of Hulu since its still in private beta: check out this review


Sunday, December 9, 2007

Buzznet, a social media network, originally founded in 2005, is certainly not a brand new startup, but this 3 year old Los Angeles based company is really beginning to take off. 

At its launch, Buzznet was really just a slightly more socialized version of Flickr, meaning thats it main focus seemed to be about sharing photos.  Since then Buzznet has transformed into a full on social networking platform and while it may not be as commonly known as Myspace or Facebook, its gaining some ground.  Nielsen ratings are putting Buzznet as one of the top 10 social media sites, with huge year over year growth.  Couple that with the announcement earlier this summer that Buzznet received it's second round of funding in the 6M range, partly from the same VC firm that has funded Myspace, and you've got a feeling these guys are on a good roll.

So what makes Buzznet so good?  Well for one thing it really does do most everything Myspace is doing only better.  Much like Myspace originally (and to some degree still is) focused specifically on music and media, Buzznet is now a general social networking site that sort of centers its community around artists and pop culture.  As opposed to the clean and simple look that Facebook takes or the clutter hell of Myspace, Buzznet is basically cool and sleek. It allows you to customize the look of your profile to a much higher degree then Facebook, but mostly manages to do it without looking as bad as Myspace.  Buzznet also has a deeper media interaction in its community than the likes of Myspace or Facebook because you can post things like photos, movies, audio, etc not just on your profile, but on other people's too (so as fan you could do things like create your own remix of your favorite band's song and post on their page).  

At the end of the day though, what makes us have the most faith in Buzznet is the adaptability they've shown.  They've evolved their site from a photo sharing community to a much more diversified social media platform.  If they continue their impressive growth, and management continues to show a pension for flexibility, they may be phased to take on the big boys soon.



Friday, November 23, 2007

Docstoc is a Beverly Hills based company that (in their own words) is "Youtube for professional documents".   Umm Okay.  Honestly that just sounds dumb.  If I was going for useless analogies, I'd say more like pdf meets Digg, or something like that.  Anyways, despite the tagline cheapshot, seems like it has a few things going for it.  Although it just went live with its public release a few weeks ago, it has had quite a bit of coverage leading up to the release, most notably in its inclusion in the TechCrunch40.  The company also has secured 4 million in VC funding.

The Good
Online Document Sharing is at a relatively early stage and a service that can make publishing easy and useful for most consumers, while keeping it secure and relevant is one that will do well.  Certainly Docstoc has the potential to succeed by being in a developing niche at the right place at the right time.  They have a strong management team, which is already doing well building buzz and bringing in a growing user base by offering iPod giveaways; I'm sure more cleverness will follow.  

The Bad
Dostoc relies a lot on community and social networking type features, and I'm not really sold that this is a game changing feature for professional documents - not everything needs to be Facebook, especially in the professional space.  There is also the matter that during testing, quite a few errors were experienced when trying to register, or upload documents, or even post info in the blog section.  While its understandable these sorts of things happen during the beta release, I expect them to tighten up their services in the future with that nice round of funding they got.  And finally, there is their early lead competitor Scribd, which quite frankly I like better. 



Tuesday, November 20, 2007

The web 2.0 company that proclaims itself as MySpace meets the yellow pages. Mojo Pages is based out of North County San Diego and have had more hype than Crystal Clear Pepsi. So lets get down to it and take a look at MojoPages.
The Good:
Lets face it user generated reviews are in and for good reason, user generated reviews offer the most reliable information to users (yeah I know it is redundant but it also makes sense)...Moreover MojoPages are adding some benefits that companies might consider as a serious benefit, for example adding a wide range of categories to review on (Value, Service, and Quality), and video reviews.

Its also hard to forget that they have millions in funding and some pretty big name people involved in the company - such as an early level employee from Zillow.

The Cons:
They are the late comer here, Insiderpages and Yelp already have a big command on the user review industry. Given that, it seems highly unlikely that many locally owned stores will want to pay for premium placement on MojoPages, with relatively low unique traffic.  Of course the biggest gripe is that it is hard for me to see what the added value of this site is, compared to any other user based review site. The most unique feature is the ability to upload video reviews, but how many people are really going to do that (not many), and even if they did how useful would the video be?

There is a huge barrier that MojoPages needs to surpass and the first is to convince their potential users that their added value features make it a better or more useful place for their reviews.  As of now I am not convinced!


A startup company out of Pasadena, CA has an interesting proposition; have users enter their measurements and their preferences in how they want their clothes to fit, and will in give them their own "Personal Shop," featuring only clothes which fit their preferences.

The Positives:
Their concept is simple and gives them direct access into a very lucrative market, from their site they mention that the women's apparel market is around $30 billion per year. Also I am not a female but I do know that women never hesitate to complain how nothing fits them and how they hate trying clothes on so seems to be angled at an open market gap. Their website is also simple to use, user friendly, simple return process and they really seem to keep customers needs first which is always a key to success in retail. Finally they have recently received millions in Series B funding so if they are smart with it they can leverage this money and place themselves at the forefront of personalized online clothes shopping for women.

The Negatives:
Getting well tailored clothes just by collecting a few measurements seems feasible from my poorly dressed perspective, but I question if it will actually work. Women judge clothes on more levels than just a few simple measurements, and to get clothes to properly fit many women I have a feeling many more detailed measurements are involved than just the few simple measurements that MyShape requires for creating your own personal clothing shop.

Overall great concept and they are executing it well.


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