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Content Tagged with Partners + venture
Social.FM, Formerly Mercora, Shuts Down
Mercora, an early entrant into the social music and music search space that recently rebranded itself as Social.FM, has shut down and suspended operations. After being tipped off by a source, I tried reaching the company’s executives, but haven’t heard from them. The site has gone black.
“The Company is unfortunately no longer in business and therefore cannot continue its service to you. Regards,. Mercora, Inc.” Over on the Social.FM home page, the company said “To our Valued Customers,. We regret to inform you and apologize for this inconvenience, but Social.FM will be shutting down the system on July 31st, 2008.” The MySpace widgets have also gone on the blink.
The Sunnyvale, Calif.-based company launched in June 2005 and had raised $5 million from Norwest Venture Partners. It was started by Srivats Sampath, the former CEO of McAfee.com, and launched with a pretty nifty P2P radio software client.
Social.FM had planned to make money by selling ads next to music searches that were conducted on its P2P network. It eventually lost out to more visible competitors, like Pandora and Last.fm, and changed its strategy. Like many other music-focused startups, the company had faced some tough times when the royalty rates for webcasting music on the Internet were raised.
Keith Benjamin, Internet Analyst & VC, RIP
Keith Benjamin, a veteran Internet analyst and more recently a general partner at Levensohn Venture Partners, a San Francisco-based venture fund, passed away earlier this week of a subdural hematoma. He was hurt during his boxing training, when a blow led to a brain hemorrhage. A memorial service was held for him in Sausalito, Calif., today.
Benjamin, 49, was one of the early entrants to the world of Internet stocks, and as a reporter for Forbes.com, I got to know him well, chatting with him often to get his thoughts on where the Internet madness was headed. He worked for Robertson Stephens then.
A thoughtful, measured and yet straight-talking Benjamin was one of the few analysts who provided perspective in the mad days of the Internet bubble. He became a VC for Highland Capital Partners and opened the San Francisco office for the Boston-based VC fund. Benjamin was a believer in B2B and Internet (software) infrastructure. He joined Levensohn Partners in 2002, and I met with him a few times when I was working for Business 2.0 and we stayed in touch. Rest in peace, my friend. You will always live in my thoughts.
In lieu of flowers, donations may be made to Golden Gate National Parks Conservancy or the San Francisco General Hospital Foundation, The Trauma Center, in Keith’s memory. If you would like to add remembrances for the benefit of the family, please link to http://www.forthebenjaminfamily.blogspot.com. Remember to sign your name so the family knows who it is from. (From Levensohn Venture Partners web site.)
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Technology-News
Meet Moondo, Multiplayer, Multi-game Network
Moondo, a new “cross-gaming universe” from Funtactix (an Israeli game studio that’s backed by $6 million in Series A funding from Benchmark Capital and Jerusalem Venture Partners) has come out of limited beta. Sort of like Xbox Live for the web, Moondo lets you create your own characters, which can jump into a variety of 3-D action and sports games. All along, points and virtual items are collected and retained across the network, so you can track your accomplishments against friends and competitors.
Since it’s free to play, Funtactix CEO Sam Glassenberg tells me, the company plans to make money through virtual item sales. Moondo’s a fun idea with potential stickiness, especially for young teens, but I strongly suspect the site’s somewhat odd cartoonish graphics will turn off older players, as will the 85 MB client install (though a web version is planned for October.)
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LogMeIn Files for $86M IPO; Gets Money from Intel
Remote computer access service provider LogMeIn has filed to raise up to $86.3 million through an initial public offering, according to a filing late last week with the SEC. The Woburn, Mass.-based company reported a loss of $6.5 million on sales of a mere $18.1 million for the nine months ending Sept. 2007, but its growth is strong, with sales increasing 151 percent in the same time period.
As it uses a peer-to-peer data transfer model after it makes the connection between the home computer and the remote user, LogMeIn faces less of an infrastructure burden as it grows. It has filed to trade on the Nasdaq under the symbol LOGM.
The company sells primarily to enterprises, so the IPO may also be an effort to gain some credibility with corporate buyers. Some of that credibility may also come from a deal LogMeIn signed with Intel in December. The previously undisclosed deal involves Intel investing $10 million in LogMeIn and an agreement to tightly integrate LogMeIn’s services with Intel hardware. The chipmaker will also market and sell LogMeIn’s service to its customers and share that revenue with LogMeIn. Polaris Venture Partners, Prism Venture Partners, Integral Capital Partners and Intel Capital are backing the five-year-old company.
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Did MySpace just buy Photobucket?
Updated with Photobucket stats: MySpace is buying Photobucket reports Valleywag, even though it is not offering any details on the price MySpace is paying for the photo-hosting company. According to reports, Photobucket had hired Lehman Brothers to shop it around and was looking for $300 million. We are still waiting to hear back from MySpace executives.
That was before Photobucket got into a brawl with MySpace, which started blocking some of its slideshow widgets that were deemed as “advertising.” The very public and ugly spat showed who was the boss, and likely the price might have come down a little bit.
The Valleywag report says that the negotiations ended last week, and there is an all hands meeting at Photobucket today at 10 am, and perhaps that is when the news is going to be announced to the employees.
So why would MySpace buy Photobucket? The MySpace photo service hasn’t really gained as much traction and MySpacers continue to gravitate towards Photobucket. According to Hitwise, “Photobucket accounted for 73% of Photography category visits leaving MySpace and Photobucket is by far the most dominant photo website for MySpace users.”
If indeed true, then it could be one Happy Monday for Photobucket’s investors - Trinity Ventures and Insight Venture Partners. Their good fortune would mean that other Silicon Valley moneybags would be willing to take riskier bets on start-ups that have high traffic, but little in terms of revenues, profits.
Some Photobucket stats via Hitwise:
- Photobucket is the 22nd most visited website overall in the US among all US websites for the week ending May 5, 2007
- 58.78% of Photobucket’s traffic came from MySpace.com and MySpace Mail combined for the week ending May 5, 2007.
- Based on Hitwise Clickstream data, Photobucket was the fifth most popular website visited after MySpace.com, with 1.7% of the traffic leaving MySpace.com to go to Photobucket for the week ending May 5, 2007.
Holy Yipes, it’s back!
Back in 2000, Metro Ethernet start-ups were telecom version of bling: shiny new things that raised hundreds of millions of dollars from brand name venture capitalists; had cool names such as Telseon, Broadband Office and Sigma Networks. And when the telequake hit, they all fell like straw huts built on landfill. One such company was Yipes Communications.
It went bankrupt, reorganized and raised even more money and started preaching the Gigabit Ethernet Mantra. That was back in 2003, and we soon lost interest. Up until last week when we caught up with John Scanlon, who is now the chief executive officer of the San Francisco-based company that now calls itself Yipes Enterprise Services.
The company (in the new incarnation) has raised a whopping $100 million from the likes of Norwest Venture Partners and Crosslink Capital, and has been on an upswing, with revenues growing at more than 40% per annum. What happened?
A few things: for instance, instead of focusing on wholesale and other market segments, Yipes adopted a smart (and simpler) strategy, with a focus on customers whose fortunes didn’t rise and fall like hemlines in Paris: banks, law firms, retail chains and large corporations. Yipes has 850 corporate customers, and is signing up more at a furious pace. It helps that it owns 14,000 fiber miles and points of presence in most major metros in US and around the globe. (Hey, all the bubble-era excesses had to come in handy sometime or the other.)
Over past couple of years, large corporations have seen their data needs go up exponentially. File transfers, data back-ups, VPNs - all need more bandwidth that what the traditional means can provide. The long-in-the-tooth T-1 doesn’t cut it anymore. Instead an increasing number of corporations are opting for Ethernet-based services.
Yipes is happy to sell exactly that: multi-megabit Ethernet services that were more than a standard 1.54 megabit/second T-1 connection and the expensive DS-3 connections.
“Bonding T-1 doesn’t do the trick and DS-3 is too much,” says Scanlon, and points out that a typical customer of theirs wants between 3 and 100 megabits per second, with the option to upgrade. Listening to the market has paid off for Scanlon, who is credited it for the Yipes resurgence. Revenues in 2006 jumped 41%, somewhere in the $40-$45 million range. Scanlon told us that in 2007, sales could be as high as $70 million. The company went cash-flow positive in the fourth quarter of 2006.
The success is not going unnoticed, and rivals like Level 3 and the Bell companies are getting serious about the Ethernet services business. To that Scanlon says, bring it on. “I battled AT&T when I was at MCI, so this is not new,” he jokes. “Level 3 is a wholesale carrier, and you know the enterprise customer is a lot different than a wholesale customer.”
He thinks that Yipes’ focused sales and support structure gives it a leg-up on rivals. “We are a focused service unlike others. There is a comfort in focus,” says Scanlon. Of course, there is comfort in the fact that you can’t do worse that your past!
For further reading, Will Reed Hundt 2.o have better luck?
