OnDeck, an alternative lending company that provides working capital and loans to small businesses, has raised $77 million in a growth investment round led by Tiger Global Management with participation from existing investors Institutional Venture Partners, RRE Ventures, SAP Ventures, Google Ventures, First Round Capital and Peter Thiel. OnDeck has now raised a total of $180 million in equity and over $300 million in debt financing, led by Goldman, Deutsche and Key Bank.
The company also announced it will hit the $1 billion mark in total capital deployed to small businesses by mid-March.
Similar to the way Prosper and Lending Club have provided an alternative for people to get loans, OnDeck is offering a way for small businesses who wouldn’t normally be considered for a loan to receive capital. OnDeck can make a lending decision within minutes, and fund within a day (vs. traditional lenders that often take weeks, even months just to gives businesses a decision).
Small businesses often turn to banks when looking for business loans, but traditionally, banks have relied on personal credit scores to evaluate the creditworthiness of their business. While business owners may have perfectly legitimate, high-growth businesses in the making, they don’t always have the kind of personal credit scores that make them attractive borrowers for banks for these large loans.
Noah Breslow, CEO of OnDeck, tells us the average loan size is $40,000, but OnDeck can loan as much as $250,000. Typical loan times are 3-24 months, so these are short-term loans. The company’s secret sauce, he explains is the alternative FICO-like score it creates for each business who applies–interest rates and acceptance is based on this score. What’s different about the score, however, is the actual data OnDeck is pulling in to evaluate. The proprietary credit models look deeper into the health of businesses (i.e. revenue, repeat customers), focusing on overall business performance, rather than the owner’s personal credit history.
Clearly there is a need for this type of lending, and small businesses are being underserved. Tens of thousands of businesses across 725 different industries have taken loans from OnDeck. And the company grew 150% in 2013, we’re told.
It’s important to note that the entire alternative lending space as a whole is growing fast.
Companies who are tackling peer-to-peer lending on the consumer side like Prosper and Lending Club are likely IPO candidates (and are moving into providing small businesses with loans as well) Payday loan companies like LendUp and ZestFinance are doing well in their respective areas. And OnDeck’s closest competitor, CAN Capital, also just raised a big round of funding as well. Additionally, Kabbage offers merchants with working capital, and Square is experimenting with this as well.
Breslow acknowledges this competition but also believes that the space is large, and there is room for a multitude of players as finance and lending continues to be disrupted. And, he adds, that the traditional lenders like banks, are actually partnering with OnDeck.
We’re told OnDeck will use the funds to accelerate new product development, geographic expansion, marketing and hiring. As for a potential IPO, Breslow says the company is trying to install the discipline of potentially being a public company but it isn’t the focus for now.
“Right my goal is to power all the small business loans in America,” he said.
Continue reading here: OnDeck Raises $77M From Tiger Global To Loan SMBs Working Capital
How much money would you guess the Internet has collectively thrown at Kickstarter?
Don’t bother whipping out the ol’ graphing calculator — Kickstarter actually shares that number regularly. Sometime quite soon, Kickstarter will surpass $1 billion dollars pledged.
This comes from Kickstarter’s own statistics page, where the company regularly provides a breakdown of where the money is going on the site. As of this morning, Kickstarter has seen $999,209,752 dollars pledged to projects — or roughly $791k shy of the big B. They’ll likely pass the billion mark some time in the next few days.
One thing worth noting: this is dollars pledged across “Successfully Funded” projects, projects in progress, and those that didn’t meet their final goal. On Kickstarter, pledged money is only received if the campaign’s target goal is met. Kickstarter says that, of the billion dollars pledged over all, $858M has been pledged to successfully funded projects.
Other interesting stats that can be gleaned from the page:
(For the curious: Kickstarter takes a 5% cut of successful campaigns. I promised you wouldn’t need your calculator, so: on the $858M that has been pledged to successful projects at this point, that’s 42 million or so that went to Kickstarter.)
See the original post: Kickstarter Is About To Crowdfund Its $1 Billionth Dollar
There are almost 900 million active cell-phone users in India now, and from newer startups to some of the biggest companies in the world, everybody is chasing the next mobile disruption that could potentially result in a business model for all of the emerging markets.
One such startup is Ezetap, a mobile payment company backed by some of the biggest names in the VC industry, including Chamath Palihapitiya, a former Facebook executive and founder of Social+Capital Partnership, and Angelprime, an Indian seed fund run by serial entrepreneurs.
Today, Ezetap is raising $8 million in Series B funding led by Helion Advisors, Social+Capital and Berggruen Holdings. This round takes the total fund raised by Ezetap to around $11.5 million (including $3.5 million it had raised in Series A funding in November 2012). The fresh capital will be used to expand Ezetap in Asia-Pacific, Middle East and Africa.
Ezetap is much like Square, at least in terms of the basic model. It uses a rectangular device that can turn any mobile phone into a point-of-sales terminal when plugged in. The device including a card reader and chip, costs around $50, and Ezetap has been able to sell around 12,000 of them to date. The startup is aiming to have over 100,000 such devices installed across Asia-Pacific, Africa and Middle East in a year.
“From day one, we wanted to go global and really felt that mobile payments in general is a great opportunity for emerging markets. There’s disparity in cash versus electronic payments leading to the challenges of financial inclusion,” Abhijit Bose, CEO of Ezetap, told TechCrunch.
Ezetap was incubated in 2011 by Angelprime, a $10 million seed fund backed by Mayfield Fund, Palihapitiya and several others in the Silicon Valley. It’s run by three veteran entrepreneurs — Sanjay Swamy, Shripati Acharya and Bala Parthasarathy. With the latest round, Ashish Gupta of Helion is joining the startup’s board. Helion is an India focused, $600 million fund.
Ezetap is the second attempt by Abhijit and Sanjay to build a mobile payment company in India. In 2006, Sanjay was the CEO of mChek which had raised around $10 million by 2009, and Abhijit worked with another venture-funded payment startup called Ngpay.
Back then, mChek and several others fizzled out because of several challenges.
“I believe there was nothing wrong with mobile payment back then, it was just the timing,” said Bose.
Indeed, the environment has changed dramatically. Back then, there were only 10 million credit cards. Today there are around 316 million credit and debit card holders in India. More importantly, the telecom infrastructure has improved tremendously, allowing users to do much more than just voice calls and texting.
“For us, Android and iOS are the game changers, too. Moreover, consumers are much more willing to use mobile payments for ease of use,” said Bose.
After building the product for one year, Ezetap officially launched with a Citibank mobile payment pilot in January 2013. Since then, the startup has signed up several banks and newer e-commerce companies, including Flipkart and online grocery retailer BigBasket. In Kenya, Ezetap partnered with Mastercard and Equity Bank to launch its services in March last year. Later in May 2013, Ezetap’s solution received global certification from EMVCo, an organization that specifies processes and gives approval for chip-based payment cards.
“Chip and pin is now the established global standard for mobile payment processing, and will soon take over the U.S. as well. Ezetap has created the only product that is certified globally, at a price point materially better than any other player – regional or otherwise,” said Palihapitiya.
Both Ezetap and Square are using similar models to enable mobile payments, but for completely different target markets, which is perhaps why Bose doesn’t like being called “the Square of India.” Ezetap’s merchants include India’s biggest e-commerce company Flipkart and even much smaller mom-and-pop shops.
“I always hate it when people call it that [Square of India]. Fundamentally, we are attacking underserved markets and are both similar in thinking about mobile payments. But we want to build a business that makes us number one mobile payment platform in emerging markets,” said Bose.
To be sure, Ezetap is not the only mobile payment startup that’s beginning to do well. With around 2 million customers using its mobile wallet, MobiKwik is aiming to reach the 100 million mark in two years. While MobiKwik and at least two dozen others are offering mobile wallets, startups such as Mswipe are more similar to Ezetap. Mswipe raised its Series B funding earlier this year from investors including Matrix Partners. All these startups are shaping an ecosystem of mobile payments in India that goes beyond just creating a non cash economy.
Originally posted here: With $8M In Fresh Funding, Ezetap Is More Than Just A Square For Emerging Markets
Fresh off its $23 million in Series B funding from Andreessen Horowitz and others, crowdfunding platform Crowdtilt is opening up its open source, white-label platform CrowdtiltOpen to all interested business users as of today. This product, previously called Crowdhoster, has been rebranded and relaunched with several more features designed for those who want to better customize and self-host their own fundraising campaigns.
The company initially launched Crowdhoster, which is built using the Crowdtilt API, into private beta last August. To date, it has seen hundreds of projects on its platform, some of the more notable being that of YC-backed nutritional substitute startup, Soylent, which raised over $2.1 million; a software company GNS3 which raised $300,000+; and a health crowdfunding campaign called the Immunity Project, which raised over $450,000.
When discussing Crowdtilt’s funding in December, CEO James Beshara explained that he saw a lot of similarities between it and WordPress, calling it the “WordPress of crowdfunding,” in fact, as businesses could add their own branding, logo, and even modify the open sourced code. (Also of note: WordPress co-founder Matt Mullenweg happens to be a Crowdtilt investor.)
Today, rebranded to “CrowdtiltOpen,” the tool offers an expanded feature set which includes recurring billing, direct payments (Visa, MasterCard, Discover, Amex), full customization or a choice from provided themes, analytics integration (e.g. Google, AdRoll, Optimizely, etc.), reward tiers, no time limitations, PCI compliance, support for non-profits soliciting donations, multiple campaigns, and as, noted above, bitcoin integration. And it’s still open sourced.
Crowdtilt says the platform is free to use, but will charge standard credit card processing fees of 2.9% + $0.30 per transaction. For now, the company says it has no plans to charge for the current feature set (though, presumably, that could change over time.)
Already, the 4,000 customers on the Crowdhoster sign-up list are being invited to use the newly relaunched platform, which is now publicly open to all.
The interest in this platform is partially responsible for the recent funding round, Beshara recently explained, saying the enterprise tools had “really started to take off,” but had required further investment to develop. The company is also working on taking its platform beyond the U.S., first targeting other English-speaking markets like Canada, the U.K. and Australia.
Read more from the original source: Crowdtilt Publicly Launches Its Open Source, Customizable Crowdfunding Platform, Now Called CrowdtiltOpen
Facebook just announced it’s buying WhatsApp, a global messaging platform with 450 million MAUs, for approximately $19 billion. It’s one of the biggest tech acquisitions since HP bought Compaq for $25 billion in 2001.
It means that WhatsApp, which raised a comparatively measly $8 million since its 2011 launch, is now worth nearly $20 billion.
Since $19 billion is a ridiculously large amount of money to wrap our heads around, we decided to compare that to other ridiculously valuable things, companies and people.
The above figures are calculated using the following metrics: The full $19 billion dollar value of the deal, which takes into account RSUs to be given to employees following its closing; and market capitalization of other companies sourced from Google Finance at close — not taking into account after-hours performance. In this way, we compare fair market rates for comparison companies, and the complete cost of the deal.
Image: composite with photo from Shutterstock
Mayfield Fund has announced that it has closed its second India-focused fund, totaling $108 million raised to invest in startups in the region.
Mayfield India II is managed by Mayfield India II Management, including the firm’s managing director Navin Chaddha, and partners Vikram Godse, and James Beck. The fund itself focuses on early-stage investments in India, and invests between $2 million and $8 million in companies targeting the infrastructure sector, tech and tech-enabled services, and the consumer middle class in the country.
“While the macro-economic climate has varied since we started investing in India in 2006, we have learned that India continues to present valuable opportunities to technology and non-technology investors,” Chaddha explained. “Two of our key takeaways are that tech-enabled infrastructure solutions can create great value, and lifestyle and entertainment products aimed at the consumer middle class can grow into universal brands.”
Mayfield’s current investments in India include Amagi Media, Centum Learning, Genesis Colors, India Property, Matrimony.com, Securens Systems, Sohanlal Commodity Management, Tejas Networks, and The Beer Café. In total, the Mayfield India team has invested in over 20 Indian companies in the past, of which seven have had IPOs and another five have been acquired. It seems that the first fund has seen success; Mayfield India I totaled $111 million, raised in 2008.
Mayfield also raised $365 million for its last main fund, XIV, in 2012 and currently has $3 billion under management.
Accel Partners also operates an India-focused fund.
Whisper, the popular anonymous social sharing startup that’s raised $24 million from venture capital giants including Sequoia Capital, may have just gotten its big break into celebrity gossip territory that’s typically dominated by the likes of TMZ and the National Enquirer.
Neetzan Zimmerman, the Gawker alum known for his midas touch in driving online traffic, promoted what appears to be the startup’s first A-list celebrity gossip scoop (Zimmerman says he has vetted the rumor). Zimmerman was hired last month to serve as Whisper’s first ever editor in chief.
While this particular bit of news is about as shallow and silly as it comes, in a larger way it reveals Whisper’s potential strategy for staying relevant in the notoriously fickle social app space. One of the chief criticisms lobbied against Whisper by those who have not caught on to the app is that it’s hard to really get worked up about the deep dark secrets of people you don’t know. But when the salacious secrets are about rich and famous people, they start to be a bit more interesting.
Now, this is not totally uncharted territory. Formspring launched as an anonymous Q&A forum, caught on like wildfire with teenagers and early-adopting tech types, raised $14 million in venture capital, and expanded into the celebrity space. Ultimately, though, Formspring ended up shutting down.
But these things are all about execution and timing — Facebook prevailed where Friendster failed, after all. Right now, Whisper is tapping into something really fascinating, and potentially very disruptive to the media powers that be.
Originally posted here: Whisper, The Sequoia-Backed Secret Sharing App, Makes A Move Into TMZ Territory
Following the trend of hardware startups becoming increasingly popular, two former leaders of Russian government-backed technoparks have launched one of their own in Kazan, Republic of Tatarstan (800 km from Moscow).
Dubbed Navigator Campus, the new project is a mixture of a coworking space and startup accelerator. The technology park’s infrastructure includes its own angel seed fund to invest into startups incubated there.
Investments in the technopark to the date have reached $4 million, of which $1 million was paid by the founders and the rest by private investors. Among the park’s venture partners, which will be investing in its resident startups, are Runa Capital, Quantum Wave, Almaz Capital Partners, Phystech Ventures, and Grishin Robotics.
The campus has already opened its doors, but the work on it is far from finished; according to the founders, in the coming years Navigator will expand to 6,000 m² of space, 800 workplaces, and 200 residents. Total amount of money to have been poured into the project by then is estimated at $10 million.
At the moment Navigator has 120 working spaces, 93 of which are already occupied. To become a resident of the campus, a startup has to pay about $4,000 per year. Among the 14 projects coming from different parts of Russia and Ukraine are three that have already raised money in one way or another:
“Engineers are granted access to scientific and business experts, VC mentors and hardware industry leaders: Dell, Samsung, IBM, Cisco, Intel, Foxconn etc. I am sure we soon shall see more venture-backed hardware deals in Russia,” said Serguei Beloussov, Runa Capital senior partner and CEO of Acronis.
The Republic of Tatarstan can be called a state of government-backed technology parks as it’s hosting dozens of them focusing on a broad range of areas from oil chemistry to IT. Ramil Ibragimov and Vasil Zakiev, who have founded Navigator Campus, used to manage two of them, in Kazan and Naberezhnye Chelny.
Now they plan to raise another $20 million to open technology parks similar to Navigator Campus in two big neighboring cities — Ufa and Perm, — while their 10-year plan sees creating a vast network of such places in every part of Russia.
Aerohive, a company that sells Wi-Fi products to enterprise customers, has today filed to go public. The company’s proposed $75 million public offering is not unexpected. It spoke directly about a future flotation when it raised its Series E round of capital ($22.5 million) in 2012.
Aerohive went back to the well a final time, picking up $10 million as a Series F in mid-2013.
The initial public offering has not been priced, nor have the number of shares to be sold been disclosed. Aerohive reiterated this in a short statement. It will trade with the ticker symbol HIVE on the New York Stock Exchange.
The company raised more than $100 million on its path to IPO. Its investors include Northern Light, Lightspeed, Kleiner Perkins, and New Enterprise Associates.
Aerohive has experienced quick growth and widening losses, due in no small part to its growing marketing spend. That expense isn’t surprising, given that the company appears to have worked to expand its top line at the fastest pace possible, even taking on $10 million in debt along the way.
Revenue at the firm was $15.6 million in 2010, $31.8 million in 2011, $66.6 million in 2012, and for the first nine months of 2013, $70.3 million. In the comparable nine-month period of 2012, Aerohive had top line of $47.3 million. So, for the first three quarters of 2013, Aerohive grew just under 50 percent.
That quick top line ramp came at a price for the firm, which saw its net loss grow from $15.7 million in the first three quarters of 2012 to $25.4 million in the comparable period of 2013. Presumably, the company will update its S-1 filing with fourth quarter, and therefore full-year 2013 data. For now, we can only view dated information.
Operating expenses were up 60 percent at the company in the first three quarters of 2013. The company indicates in its filing that it has never had a quarter, let alone a year, of profitability.
Quickly expanding revenue and rising losses? Investors that buy into its offering will be wagering that its growth will not slow, and presumably dollars raised from the public markets will help the company grow all the more quickly.
Aerohive is not the only technology company looking to go public at the moment. Box has filed for a public offering, as well, albeit privately.
Continue reading here: Aerohive Networks Files For $75 Million IPO
Front Desk, a software as a service platform and mobile business management tool that can handle things like scheduling, payments and client management, today announced that it has raised a $4 million Series A round. This round was led by Floodgate, with participation from existing investors, including Second Avenue Partners, Version One Ventures and Expedia founder and Zillow co-founder Rich Barton and others.
Together with the $3.2 million round the company raised last September, this brings the company’s total funding to $7.2 million. As part of this new round, Floodgate’s Mike Maples, Jr. and Version One Ventures’ Boris Wertz will join the Front Desk board.
Front Desk, which launched less than a year ago, mostly focuses on personal services businesses like yoga studios, gyms, tour operators, music schools and tutoring centers. The company says it currently has about 1,000 businesses in 20 countries on its platform. To complement its comprehensive web and mobile apps, Front Desk also offers dedicated apps for staff, new client signups and client sign-in.
As for why Front Desk decided to raise this quickly after closing its first round, the company’s CEO Jon Zimmerman tells me that this new capital will allow the company to “to grow our team, invest in product and marketing, and tap into the global opportunity we see within the personal services industry.” Indeed, Front Desk plans to double its workforce by the end of the year, both on the engineering and marketing side.
Front Desk offers mobile apps that allow small and medium businesses to track scheduling and workshops and handle online registration. Through its billing and payments tools, the company is on track to process more than $100 million in payments this year.
Companies pay Front Desk through a combination of a tier pricing scheme and a cut of their transactions. Fees start at a minimum of $45 per month and then move to a percentage of the transaction volume as companies grow.
Zimmerman noted that Front Desk’s goal is to increase its user’s revenue by “removing and reducing revenue leakage through billing and attendance tracking; and helping them to reduce their overhead interest.” And the better its users do, the better Front Desk does as well.