Omada Health Raises $23M Series B Led By Andreessen Horowitz For Digital Health That Actually Works

Omada Health, a San Francisco startup that makes digital health therapy programs for people with type 2 diabetes and other serious but potentially treatable issues, has raised $23 million in new funding.

The new investment, which is Omada’s Series B, was led by Andreessen Horowitz, with Andreessen Horowitz partner Balaji Srinivasan joining the startup’s board of directors. Also participating in the round were Kaiser Permanente Ventures and previous investors U.S. Venture Partners and The Vertical Group. This brings the total investment in Omada to $28.5 million.

In an interview this week, Omada co-founder and CEO Sean Duffy told me that his company aims to bridge the gap between proven traditional offline support groups and therapies, and modern digital technology. He said:

“The behavioral science world has figured out how to help people with issues like diabetes, smoking cessation, insomnia, and the like. But it’s mostly been in face-to-face treatments, with group meetings at places like community centers and YMCAs.

We’ve looked at the elements and turned these things into digital programs, and made programmatic experiences that we validate clinically with reproducible results.”

Clinical results mean that Omada’s programs are things that insurance providers are actually willing to pay for. Omada’s flagship treatment, called Prevent, is a 16-week web-based program aimed at addressing prediabetes in adults. Because Omada has been able to provide clinical proof that its programs work just as effectively as traditional in-person therapies, they are covered by healthcare providers including Blue Shield Louisiana, Kaiser Permanente, and Stanford Hospital.

The financial reimbursement is what truly sets Omada apart from other consumer-oriented players in the health space. “In the world of digital health 1.0, people have made great products that people want to use and share with friends, but they haven’t fit with enterprise level health programs,” Duffy says. “Omada has developed consumer grade digital health products, and we also know how to get health systems to pay for them.”

In a separate interview, Andreessen Horowitz partner Balaji Srinivasan told me that it’s that mix of consumer approachability with clinical results that compelled his firm to invest in the company. “Omada is first thing I’ve seen which is a clinically proven way to make a medical intervention over an Internet connection. They’ve developed clinically valid, reproducible, scalable treatments that are delivered in whole or in part over the Internet,” he said. “It’s this very clever combination of things.”

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As far as the competitive landscape goes, Duffy says that Omada has raised this money now to take advantage of its position at the nexus between consumer-first apps and enterprise health products. “We’ve seen companies like Fitbit and Weight Watchers increasingly eyeing the enterprise healthcare space. And big health plans like United Healthcare are creating potential competitors too,” he said. “We bridge between these two worlds, and we want to continue to grow in a way that others can’t yet.”

Omada currently has 30 full time staff, and expects to double its headcount by the end of the year.

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Facebook’s $2B Oculus Deal Happened Over The Last Five Days

Facebook’s deal to buy Oculus VR for $2 billion happened relatively quickly and the negotiations were hammered out over the last five days, according to sources familiar with the deal.

Mark Zuckerberg had been by Oculus’ offices just once before to hang out earlier this year. He played with the company’s DK2, or second development kit.

Both Spark Capital, which led the company’s $16 million Series A round, and Andreessen Horowitz, which led the company’s $75 million Series B round, have an equal stake in the company, according to the source. Matrix was also in the Series A as well. Venture capitalist Marc Andreessen, who sits on Facebook’s board of directors, recused himself from the negotiations.

“For whatever reason, he got the religion,” a source involved in the deal said. Oculus’s headset has already seen 75,000 orders for development kits, Zuckerberg said on an investor call.

Zuckerberg explained that he felt that Oculus represented an entirely new post-PC and post-mobile platform.

Indeed, after not moving quickly on other earlier deals, perhaps Zuckerberg felt that he needed to be more pre-emptive.

Because Facebook doesn’t own its own mobile operating system, it has had to pursue a more horizontal strategy by building several standalone mobile apps and creating a social layer across third-party apps. But because mobile phones can also be connected by the address book, other competing mobile social networks like Snapchat have been able to rise up quickly and accumulate hundreds of millions of users.

According to other sources familiar with the $19 billion WhatsApp deal, the company’s leadership on the messaging product had been urging Zuckerberg to buy WhatsApp for at least two years. But because both companies didn’t get serious until this year, WhatsApp had already accumulated nearly half a billion users and came with a significantly higher price tag.

“I don’t think you should expect us to do multiple multi-billion dollar acquisitions at this rate,” Zuckerberg said on the call. “We think that WhatsApp is one of the rare companies that will reach 1 billion people and those companies are really valuable. Also, there are not that many things that are candidates to be the next major computing platform. This company Oculus has a clear lead to do this.”

Originally posted here: Facebook’s $2B Oculus Deal Happened Over The Last Five Days

On-Demand Ride-Sharing Startup Lyft Is Raising Another Big Round Of Funding

Lyft is raising yet another big round of funding, according to sources. The company, which is seeking to make ride-sharing mainstream in cities across the U.S. and around the world, is expected to use the new cash to fund expansion into new cities and territories.

We’ve heard Lyft has pitched a number of venture firms and late-stage institutional investors, but hedge fund Coatue Management seems to be in the lead for the deal. Coatue has recently invested in hot companies like Box, Snapchat, and HotelTonight, and is part of a growing trend of hedge funds making bets on later-stage startups with traction.

Andreessen Horowitz, which led Lyft’s $60 million Series C round, is also expected to contribute a large chunk of cash. Other investors in Lyft include Founders Fund, Floodgate, Mayfield Fund, K9 Ventures, Ooga Labs, fbFund, and Keith Rabois.

The company was founded as Zimride back in 2007, but it wasn’t until 2012 — when it shifted from long-range to on-demand ride-sharing — that things began to really take off.

With the launch of the Lyft mobile application, it broke new ground in enabling passengers to get rides from other people with a car and spare time on their hands. Due to the success of the on-demand platform, the company rebranded as Lyft and sold its legacy Zimride assets to Enterprise Holdings last summer.

After its initial stint in San Francisco, Lyft began expanding to other cities early last year and now is offering service in 20 markets throughout the U.S. But like Uber, which also offers on-demand rides via mobile app, Lyft has plans to aggressively increase the number of international cities that it operates in beginning this year.

The additional funding will be vital to getting it on the right track toward that goal, as it bulks up operations both in its San Francisco headquarters and in remote offices around the world.

In the meantime, Lyft is trying to get more regulators and local officials comfortable with the idea of letting unlicensed drivers give rides to passengers around town. To that end, it recently hired Google X legal director David Estrada as its VP of government relations.

The company also announced the creation of a peer-to-peer rideshare insurance coalition that includes other transportation companies, as well as regulators and insurance providers, to figure out the tricky issue of insurance for its drivers.

Lyft, Coatue, and Andreessen Horowitz all declined to comment.

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Andreessen Horowitz Brings On Londoner Benedict Evans

Andreessen Horowitz is widening its talent pool once again. Today the company is adding Benedict Evans, a long-time mobile analyst and pundit, to its team. He is currently based in London but will be relocating to Menlo Park.

Unlike many who have joined Andreessen Horowitz, Evans is not cut from entrepreneur cloth. He has been working in the media and tech industries for 15 years, but for larger organizations and on the analytical/strategic side. He first entered the industry as a sell-side equity analyst for investment banks. Then he moved on to roles at Orange (the mobile operator eventually bought and rebranded by France Telecom), Channel 4 and then NBC Universal.

Lately, he’s been writing insightful things and crunching numbers for London firm Enders Analysis, focusing mainly on mobile (which is how I came to know him).

Until today, his Twitter handle, in typical understated Ben Evans style, noted his track record in brief and that he was now “looking for something difficult to do.”

Now it reads that he’s being transplanted to a16z.

Evans is not joining as an investing partner, but as an a16z spokesperson puts it, a partner nonetheless, acting as a kind of in-house analyst and consultant who will help the team make investments.

“We’re all partners here,” she notes. “He’ll be working closely with the Deal and Research team and across Andreessen Horowitz to bring his insights and analysis to the firm and our portfolio.”

As for why Evans decided to make the move, it seems like his particular brand of deep thinking fits well with the ethos there.

“Late last year I spent some time with the Andreessen Horowitz team, and it’s pretty clear that this is one of the best places there is both to see those dents being made but also, given the a16z model, to contribute a little to that process,” he writes in the blog post on his own site. “So I’m happy to announce that in February I’ll be joining a16z in Menlo Park. I’ll continue to analyse the industry in public, here and elsewhere online, but in addition, I’ll now be working with the rest of a16z to find, understand and support great ideas and great companies.”

A sunny congratulations, then, to Ben, from slightly wetter London.

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A16z Looks To Raise New $1.5B Fund, Primack Says

Andreessen Horowitz is raising a massive new fund, according to Fortune’s LP whisperer Dan Primack. The expected total for the new fund is $1.5 billion, giving the venture group sufficient capital to pursue deals at every funding point at scale.

According to CrunchBase, Andreessen Horowitz previously raised a total of $2.65 billion, meaning that this new fund would be equal to more than half of its prior total. The $1.5 billion new fund is the same size as the group’s’ Fund III that was put together in 2012.

It’s no accident that the funds are the same size, says Primack, who reports that the new fund will be “similar in structure” to the past fund. Given that, we can expect the new fund to contain monies for both early stage investment and large deals alike.

At the moment Andreessen Horowitz is regarded as some of the smartest money in circulation.

The group rose to prominence on the back of its massively lucrative investment in Skype, which was later sold to Microsoft for more than 8 billion dollars. In late 2013, Andreessen Horowitz announced a reticence to invest in companies at the Series A level, implying that its new fund will find a home in companies that are generally of larger scale.

Andreessen Horowitz declined to comment.

Top Image Credit: Flickr

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Google Puts Rap Genius Back Atop Searches, Favoring Smart Results Over Holding A Grudge

Google apparently cares more about giving the best search results than punishing spammers, as it’s returning lyrics site Rap Genius to its high rankings for searches after it was exiled for SEO spam 10 days ago. What looked like a death sentence for Rap Genius’ traffic has turned into a slap on the wrist. Today Rap Genius detailed what it did wrong, and how it ditched the spammy links to get back in Google’s good graces.

Previously on “Rap Genius’ SEO blunders”, the startup had raised $15 million from Andreessen Horowitz to annotate the web. It’s site hosts lyrics, religious texts, legal documents, poems, and news and allows users to add explanations of what they mean. The Rap Genius founders are known as braggadocious rabble-rousers, and they showed off their ridiculousness on stage in an interview with me at TechCrunch Disrupt New York embedd below. There they discussed doing study drugs like Adderall while naked to make sure the stayed home and focused on building the site.

Rap Genius steadly rose to the top of many search result pages thanks to links from bloggers and being venture funded so it doesn’t have to show ads like the aggressive pop-ups and ringtone scams that pollute competing lyrics sites like AZlyrics and MetroLyrics.

Screen Shot 2014-01-04 at 1.09.36 PM

But in a sketchy failed attempt at growth hacking, Rap Genius started the “Rap Genius Blog Affiliate” program where it would promote anyone’s blog post through social media in exchange for the blogger inserting sets of links to Rap Genius lyrics into their posts. For example, it asked email filtering startup founder John Marbach to add links to Rap Genius pages for all of Justin Bieber’s new songs in hopes of scamming its way to the top of searches for Bieber lyrics.

The problem is that Google prohibits sites from gaming its search engine ranking algorithm by having links to them added to unrelated web pages and blog posts — which is exactly what Rap Genius was doing. Marbach published the instructions Rap Genius had sent him, which tipped off  Google’s search spam czar Matt Cutts who said his team would investigate.

Despite an apology from Rap Genius, we detailed how Google destroyed Rap Genius’ search engine result page rankings, burying them on the fifth or sixth page of results for lyric searches and even searches for “Rap Genius” where they used to rank high. The punishment dealt out on Christmas had a devastating impact on Rap Genius’ traffic since a signficant amount of it comes from Google searches. Quantcast says Rap Genius fell from around 700,000 uniques a day to around 100,000.

Quantcast shows Google punishment's devestating impact on Rap Genius traffic

At the time, Rap Genius told TechCrunch “We are working with Google right now to resolve this….We’re working on it as fast as we can, and expect to be back on Google very soon.”

Negotiations appear to have panned out well, as today Rap Genius announced “Rap Genius is back on Google. It takes a few days for things to return to normal, but we’re officially back! First of all, we owe a big thanks to Google for being fair and transparent and allowing us back onto their results pages.”

In its lengthy blog post, Rap Genius explains how it initially begged music bloggers to link to it when appropriate. But then the founders Mahbod Moghadam, Tom Lehman, and Ilan Zechory admit “We overstepped, and we deserved to get smacked”, in reference to the shady Blog Affiliate program. “We apologize to Google and our fans for being such morons”, they wrote, showing they sure don’t come from the Snapchat ”never say sorry” school of crisis management.

Rap Genius goes on to detail how it got back on Google. The search engine had handed down a “manual action” where it directly manipulated search results to push down Rap Genius URLs as punishment. The reason was for “Unnatural links to your site” that Google explains as “a pattern of unnatural artificial, deceptive, or manipulative links pointing to your site.”

To fix this, Rap Genius had to either have all the spammy links removed, tagged as “nofollow”, or disavowed. But there were hundreds of thousands of these links scattered around the web. So Rap Genius contacted the webmasters it knew, and built a scraper to find the rest of the links. Those it couldn’t have removed or tagged “nofollow” were fed into Google’s Disavow tool that prevents them from influencing search result rankings.

Rap Genius FoundersIn a move that demonstrates why a bunch of rowdy Yale guys prone to telling tech luminaries like Mark Zuckerberg to fellate them got $15 million from Andreessen, Rap Genius detailed how it built a highly efficient, parellelized scraper. With tools like Nokogiri, Typhoeus, Heroku, and some serious hacking, it created a scraper that found all the links in just 15 minutes. The code snippets the technical details included in the post are surely an attempt to raise Rap Genius’ status amongst engineers it might try to hire.

In the end, it fetched over 177,000 URLs to find and fix or remove spammy links to its site. And apparently that was enough to get Google to restore their SEO standing.

Of course, it likely didn’t hurt that Rap Genius is funded by Andreessen Horowitz, one of the most powerful and well-connected venture capital firms in Silicon Valley. A bootstrapped company without such advantages might not have gotten off as easy, which some could construe as Google playing favorites.

We’ll check back to see whether Rap Genius regains all of its SEO juice, or has any lingering penalty, but Rap Genius’ site is now the top result for searches of “rap genius”, and it’s also again appearing amongst the top results for searches like “Kanye West Blood On The Leaves Lyrics”. Rap Genius is also planning to try to ween itself off such dependence on Google with the release an iOS app next week.

Rap Genius Competitor AZLyrics features scammy ads and little content

Rap Genius Competitor AZLyrics features scammy ads and little content

In the end, Google is putting its users first. Though Rap Genius’ tactics may have been deplorable, they provide a much better lyrics site experience than most of their competitors. Sites like AZlyrics and Metrolyrics are covered with scammy ads for $9.99 a month ringtone subscriptions, and are suspected of also engaging in dubious SEO practices. That’s not a music player in that screenpic of AZLyrics above, it’s a deceptive link to another site.

Meanwhile, Rap Genius provides accurate lyrics as well as explanations of what lyrics mean so you can decode obscure metaphors. It also provides SoundCloud embeds so you can hear songs, links to YouTube and Spotify, and even notes about where a song’s samples come from.

Google could have kept Rap Genius in a search ranking dungeon, but it would have just pushed its users to visit worse sites, and that just doesn’t jive with Google’s mission “to organize the world’s information and make it universally accessible and useful.”

For more on the absurdity of Rap Genius, check out:

When Growth Hacking Goes Bad

Google Destroys Rap Genius’ Search Rankings As Punishment For SEO Spam

Disrupt On-Stage Video: Rap Genius’ Co-Founder Apologizes To Zuck (Then Says They’ll Be Bigger Than Facebook)

Video Interview: Ben Horowitz And The Founders Explain Why A16Z Put $15M Into Rap Genius

Rap Genius Is Getting Into Breaking News Analysis With News Genius

Rap Genius Reveals One Of Its Business Models Will Be ‘Enterprise Genius’ Collaborative Tool

[Image Credit: Danny Ghitis]

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