All posts in “Venture Capital”

Squarespace reportedly raises about $200 million at a $1.7 billion valuation

Squarespace, the 14-year-old platform that makes it easy for essentially anyone to build their own website, is raising about $200 million from General Atlantic, valuing the company at a $1.7 billion valuation, Bloomberg reports. The plan with the funding is to buy stock from early employees and investors, giving them a way to cash out if they’re not trying to wait around for an IPO.

Squarespace is a profitable company, with revenues increasing 50 percent in the last year to about $300 million. A big Squarespace competitor, public company Wix, is expected to generate about $424 million in revenue this year.

Before going public, Squarespace reportedly wants to get better about helping its customers sell products through their websites.

“It’s the most requested feature on the platform right now,” Squarespace CEO Anthony Casalena told Bloomberg. “A lot of people are there building a brand. They want to sell something.”

Squarespace had previously raised $78.5 million from General Atlantic, Index Ventures, Accel and others. Squarespace declined to comment on the deal.

Featured Image: Photo by Neilson Barnard/Getty Images for New York Magazine/Getty Images

Bitwise Investments raises $4M to launch its crypto index fund

Last month San Francisco-based Bitwise Investments announced a passively managed index fund comprised of the top 10 cryptocurrencies by market capitalization. The fund rebalances once a month, and all assets are held in cold storage. Essentially its an easy way for investors to gain some passive exposure to cryptocurrency without having to worry about which ones to choose and how to buy and store them.

Today the startup announced they’re raising $4M in seed funding to build out the team and work on developing new investment products. Investors include Khosla Ventures, General Catalyst, Naval Ravikant, Elad Gil and others. Bitwise is also accepting investors as of today, with baskets being created every two weeks going forward.

The startup plans to use the funding to hire 10 new employees – five on the engineering side and five on investors relations and business development. While five engineers seems like a lot for a small passively managed fund, Bitwise wants to build out a software platform so it can stand out from other traditional asset management firms. This means the startup will provide products like a real-time dashboard for investors (as opposed to a monthly emailed PDF) but also focus on complicated engineering issues like optimizing cold storage procedures.

Right now investors have to be U.S-based and accredited since it’s a private investment vehicle and not an ETF. The minimum investment is $10,000 – which is generally much less than a crypto-focused hedge fund would require. Going forward they’re planning on launching a Cayman Island vehicle so international investors can participate.

You can read more about Bitwise Investments and and their first fund in our original launch post here.

Featured Image: Li-Anne Dias

San Francisco was the place to be for people in tech. Then it wasn’t.

Jeanna Barrett had spent the last 20 months in Seattle helping grow a location-based mobile app. In April 2011, Groupon acquired the startup, and it declined to keep her on staff. 

Fine by her.

“I called my parents after I found out I didn’t have a job at Groupon and said, ‘I’m moving to San Francisco.’ I just knew I wanted to make it work,” Barrett said. 

Barrett is one of thousands of hungry tech workers that move to San Francisco each year. The influx of people and money centered around technology has been extreme even for a city with a sports team named for the 1849 gold rush. Software engineers and marketing strategists look to the city by the Bay as the place to live to be a part of innovation. The tech explosion of the last two decades has transformed the area, turning its metro areas into some of the richest in the world. 

It’s also changed what used to be a crunchy town. As rents skyrocket and people age, a growing number of once-zealous overachievers are leaving the city, disenfranchised by what tech has done to the area, wondering whether the industry is really doing all the good it promised.

Three years after moving to San Francisco with dreams of life in tech’s Mecca, Barrett felt like she was done. She was frustrated by “the busy rat-race lifestyle,” as she called it.

Barrett tried to multi-task exercising and working by using a treadmill desk.

Barrett tried to multi-task exercising and working by using a treadmill desk.

Image: jeanna barrett

Barrett with friends at the 2016 Cider Summit in SF's Presidio.

Barrett with friends at the 2016 Cider Summit in SF’s Presidio.

Image: jeanna barrett

So Barrett left. She moved to Belize and says she’s never been happier. 

“I drank the Kool-Aid for so long,” she said. “I was under the impression that I had a great, amazing job, and why should I not be happy?”

San Francisco and tech, it would seem, are turning into any other city and industry.

‘I stopped recognizing it’ 

Jennifer Rice moved to San Francisco in 2007. The tech industry wasn’t her main motive, although she did have a decade of experience working in it while living in Dallas. She heard great things about the lifestyle, especially for someone who loves the outdoors. 

Rice ended up landing a consulting job, where her clients weren’t in tech. Within her first year in the city, she learned only one industry dominated conversations in San Francisco.

“I certainly feel like technology was a virus. Everything is getting gentrified. You go everywhere, and it’s like tech bro heaven. I stopped recognizing [the city],” Rice said. She noticed the changes when she first moved there and said it’s only gotten more noticeable in the past couple of years. 

“Technology was a virus. Everything is getting gentrified. You go everywhere, and it’s like tech bro heaven.”

Each person’s story of departure is unique, yet there are many relatable themes. Individuals point to issues like the housing crisis in San Francisco and sexism in the tech industry, which aren’t new problems but increasingly more of a concern. 

Despite living in San Francisco to work in tech, many of the people we spoke with became annoyed by that industry. Other concerns echo similarities to life in any big city. What’s clear is that Silicon Valley as the obvious choice for people in tech is itself being disrupted.

Venture capitalist turned blockchain engineer Preethi Kasireddy published “Why I’m leaving Silicon Valley” on Medium a couple weeks ago. She’s not giving up on the tech industry, but she’s moving to Los Angeles. As for why she chose that city, diversity, weather, and L.A.’s own booming tech industry were all factors, she wrote.

The reactions “have been majorly very positive, particularly from people outside the Valley. They find it nice to hear you don’t need to be in the Valley to do what you want to do,” Kasireddy said.

Rice writes that the kinds of people she met in San Francisco most days tended to be “homogeneous” — often they were engineers, venture capitalists, or entrepreneurs. Of course, the Bay Area has plenty of teachers, doctors, and accountants as well, though they’re perhaps just a little more difficult to come by than in other cities.

Tim Ferriss, an author and angel investor who spent 17 years in the Bay Area until he recently relocated to Austin, echoed that struggle to break out of the tech bubble in a recent AMA on Reddit. 

“There is also a mono-conversation of tech that is near impossible to avoid,” he wrote. “This can be dodged, but it takes very real and consistent effort.”

Rampant gentrification is a persistent issue in San Francisco, and it’s only getting worse. UC Berkeley’s Urban Displacement Project is monitoring the problem, and recently updated its map evaluating SF neighborhoods. From 2013 to 2015, five tracts (out of 24), including the Tenderloin, Chinatown, and the Bayview, moved from low income stable to “at risk” of or ongoing displacement.

“I even feel like I got there too late,” said Rice, who lived in the historic Fillmore District. “There were mom and pop shops, really small locally owned. It felt like a neighborhood. Now, there’s a Rag & Bone. My little post office guy, where I had my PO box, he had to move out because he couldn’t afford it anymore.”

Tech’s playground

As local charm and diverse communities disappear, and popular retail stores and chain restaurants proliferate, San Francisco is at risk of becoming more of an “Any Town, USA.”

And yet, San Francisco isn’t just any “Any Town” these days. The perception of those who have left is that it’s the tech industry’s town, and the tech industry sparked some of the change. Living in San Francisco has been part of the incentives package to come work for tech companies like Facebook, even when their headquarters are hours away. 

Every weekday morning, thousands of Apple, Facebook, and Google employees board buses from stops throughout San Francisco to travel to their offices in Cupertino, Menlo Park, and Mountain View, respectively. People who could have lived in San Jose or other cities much closer to their offices instead live forty miles and a traffic jam away in SF.

The shuttles inspired fierce backlash at times. In 2014, protesters blocked buses. According to these protesters, the tech industry had helped caused housing prices in SF to skyrocket, especially near the shuttle stops, making it unaffordable for many to live there.

Image: flickr, cj martin

The perception among those who have left is that gentrification has in part helped brighten neighborhoods, but it’s also forever tarnished the community.

“Part of it is cool, admittedly, even better restaurants, but they’re pushing out the old,” Rice said. “When I moved here, it did not feel like a big city. It felt like all these different sets of global communities. That’s all gone … It’s turning into a New York, which, alright, some people might like.”

Rice didn’t. She packed up her bags this past summer and moved to Santa Fe. 

A hamster wheel 

San Francisco may have “cool” new restaurants, but that doesn’t mean the people in the city have time for them. The tech industry has been described as a “hamster wheel,” with employees pressured to “spin” the company past the competition and toward greatness.

For some recent graduates joining the workforce, the hustle can be positive — at least in some situations and for some stages of their lives. 

Working at a tech startup was an easy transition for someone just coming out of college like Eric Toda. He joined Facebook in 2008, shortly after graduating from San Francisco State University. 

“I loved how young everyone was. It felt like you were part of a rebel group, surrounded by people who constantly challenged each other,” Toda said. “I was 23, and failures were celebrated.”

In those days, only four years after its launch, Facebook was still a startup. Chief Operating Officer Sheryl Sandberg had joined earlier that same year. Four more years would pass until Facebook went public. 

Facebook's Menlo Park headquarters in 2011

Facebook’s Menlo Park headquarters in 2011

But as major tech companies are maturing, their employees are having trouble maintaining the “work hard, play hard” ethos.

“They have amazing perks that other companies would never have, but you’re still going to work. They want you to be a martyr,” Toda said. 

“I needed a better lifestyle to be dad. I can’t be a father at Airbnb.”

Toda stayed at Facebook until 2013 and then moved to Nike to serve as its global director for digital brand marketing. A year later, he came back to the tech industry; first Snapchat and then Airbnb. 

But it wasn’t sustainable for Toda as he entered a new stage of his life: being a father. 

While some tech giants have made moves to better support work-life balance such as more generous parental leave policies, it is perceived as lip-service, rather than something the company actually embraces.

Toda ended up leaving Airbnb in September to join Gap. 

“I needed a better lifestyle to be dad. I can’t be a father at Airbnb,” he said of his thinking at the time. “When I joined Gap, they said, ‘You’re going to surrender your email account to us,'” Toda said, referencing his upcoming parental leave. 

Gender issues also persist. Other industries face sexism problems: Hollywood, Wall Street, advertising, journalism, to name a few. But there’s concern among the departed and those still there that the tech industry is one of the least equipped to handle this issue. 

Alexandra Marshall serves as head of community and communications at tech startup Health IQ in Mountain View and previously worked at Goldman Sachs. She responded to a tweet about Silicon Valley facing a reckoning similar to Wall Street, arguing Wall Street had a better work environment. 

“There is no standardization of HR practices or hiring or firing or policies for time off or parental or medical leave,” she added later. 

Barrett also connected her tiredness to the sexism she said she faced while working in the tech industry in San Francisco. 

“I was told I talk too much in meetings. I was in and out of the HR department all the time with, ‘People don’t like you. You’re out of line,'” she said. “And all I do is state my opinion as a business person.” 

Making the move 

Leaving Silicon Valley wasn’t easy for these people, but not because they didn’t have the financial means. Rather, some said they hesitated because they didn’t think they should leave. 

Rice said she didn’t recognize how stressed she was until she was on vacation in Santa Fe. 

“In San Francisco, everyone is on the hamster wheel and you spin and spin and spin just to afford to live there.”

“I really felt it in my body, letting go of the stress I was carrying, and I noticed it for the first time. It was going back to San Francisco after being out of it for a week and a half that I immediately felt my energy and my body just contract,” she said. “In San Francisco, everyone is on the hamster wheel and you spin and spin and spin just to afford to live there.”

Rice moved to Santa Fe and recently founded her own consultancy.  

More than a year after her move, Barrett said she’s happier than she has ever been. In her case, she swapped her typical work outfit of jewelry and expensive haircuts with a bathing suit and a ponytail. 

Jeanna Barrett now lives in Belize.

Image: jeanna barrett

Toda still lives in the Bay Area while working at Gap. He noted that he personally isn’t done with the tech industry or northern California, but he said that innovation is not exclusive to his hometown.

Kasireddy, the blockchain engineer who is moving to Los Angeles, described her exit as a double-edged sword. One aspect of leaving San Francisco is she’ll miss people who work in and understand the tech industry. But that’s also exactly what she wants to get away from. 

“I don’t want to go to a dinner and talk about work or party and talk about work,” she said. “People actually have other lives other than work, and not just LA, in most other places outside of [Silicon] Valley.”

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Earny raises $9M to refund your purchases when prices drop

Have you ever bought something only to see it go on sale the next day?

It may seem like bad luck, but you’re often still entitled to get that discount. Some retailers and credit card companies will even guarantee price drop refunds for up to 90 days.

But it can be a hassle to keep track of price changes and to follow through and get your money back. A handful of sites have been springing up to handle this on your behalf. One of those is Earny. 

Earny’s app syncs with your inbox and identifies receipts. It then monitors prices at Amazon, Wal-Mart, Target, Best Buy and others. Earny will contact the retailers to ensure that the money goes back on your credit card, or arrives via a check. Earny takes a 25% commission for its efforts.

The Santa Monica, California-based startup is now raising $9 million to accelerate its growth. The latest round was led by Mayfield with participation from Comcast Ventures and Science Inc. Earny previously raised about $2.5 million. 

The startup is also announcing that it will be automating credit card price protection claims for all Visa cards. Earny says it tracks about 50 million items from the top 35 retailers.

The business says its users end up getting about 5% of their money back, on average. The most common refunds are for electronics and clothes.

When asked if the retailers would be frustrated by Earny’s model, CEO Oded Vakrat insists that it’s just the opposite.

Vakrat claims Earny “reduces item return rates because customers are more satisfied from their purchase.” He believes they are “three times more likely to purchase again from the same retailer.”

Mayfield partner Rishi Garg says he invested in Earny because he was “impressed with their unique take on customer advocacy and the comfort they bring to shoppers that their purchases are protected.”

Earny plans to use the funding to build out its product and expand into travel. Starting next year, for example, users will be able to get discounted rates at hotels.

Featured Image: megaflopp/Shutterstock

Farmers Business Network just raked in a whopping $110 million in Series D funding

Farmers Business Network has raised $110 million in new venture funding to support a business that may sound boring to some Silicon Valley technologists but which appears to have addressed a very real need: it’s a social network for farmers that invites them to share their data, pool their know-how, and bargain more effectively for better pricing from third parties.

It’s a real business. The subscription-based, members-only platform costs these farmers $600 per year. In return, they share seed and other crop-related data with other members, who then use those findings to determine the seed and pesticides — and the vendors — that will help them goose their bottom lines. Indeed, FBN, as it’s called, makes it easy for farmers to upload, store and analyze the data coming out of a variety of tools they collectively use, from drones and satellites to mobile apps and on-the-ground sensors.

That’s just one part of FBN’s operations, however. The three-year-old, San Carlos, Ca.-based company has also more recently launched an e-commerce arm, selling products like herbicides and fungicides that it purchases directly from manufacturers and distributors, then sells at what it says are lower-than-average costs. (It houses the products in nine of its own warehouses across the country.)

FBN is further building out a marketing product that promises to connect farmers with thousands of possible buyers who may want their specific specialty crops and who will pay a premium to know more about the source. Imagine the food company that says it wants 10,000 acres of a precise variant of soybeans that have not been genetically modified. FBN says it can get those who farm them a better price for it; the food company is meanwhile armed with information about what fields the beans are coming from and it can even, potentially, watch them via satellite imagery.

All three hooks are appealing propositions for the farmers, who’ve generally been hard hit by years of falling crop prices — not to mention hurt by lousy deals on seeds and other items that are often sold to them by manufacturers who obfuscate their pricing.

Blue chip investors like FBN, too — this despite competition from startups like Manitoba, Canada-based Farmers Edge and Granular in San Francisco and even seed giants like Monsanto, whose Climate Corp. division provides farmers with similar tools. In fact, today, FBN is announcing that it has raised a whopping $110 million in fresh funding co-led by T.Rowe Price and Temasek, the wealth fund owned by the Government of Singapore.

The blue-chip investors clearly see FBN as more than a curiosity. That’s partly because FBN’s members now represent just shy of 5,000 farms across the U.S. and Canada, and collectively manage roughly 16 million acres of farmland — a land area larger than West Virginia – says FBN cofounder and head of product, Charles Baron.

Among the crops farmed on this land are oats, sweet peas, lentils, wheat, corn, and soybeans.

Investors are also eyeing the bigger picture, he suggests. More than 170,000 people make their business by farming major crops, yet they have among the lowest return on their assets because they’re so fragmented, leading to information asymmetry and a lack of bargaining power. If FBN can convince this much broader base of potential customers that it puts farmers back in the driver’s seat — as well moves them closer to food consumers —  it becomes very well-positioned to capture a huge market.

FBN is making headway, certainly. The young company already counts 200 employees around the U.S. Now, it expects to use its new cash infusion to do more hiring and generally “accelerate the business,” says Baron.

Part of that means pushing more aggressively into Canada, “whose farmers face the same problems that all farmers face, as far as their disadvantaged position in the [broader food] market,” Baron says.

Part of that capital might also be used some day by FBN to create some of the products it is currently selling to farmers, like seeds and pesticides. “Theoretically,” says Baron, FBN likes the idea. For now, however, FBN remains a “data network first and foremost” he adds. “We’re really focused on creating a digital farm economy in ways it has never existed before.”

In addition to T.Rowe Price and Temasek, earlier investors GV, Kleiner Perkins, and Campbell Soup’s Acre Fund, also joined FBN’s newest round, which is its Series D.

The capital brings the company’s total funding to roughly $200 million.