Venture Capital

Andreessen Horowitz drops $15M on Web-annotation startup

Looking to help jump-start a new era in annotating Web text, leading venture capital firm Andreessen Horowitz today said that it's investing $15 million in RapGenius, a startup that enables such annotations.

RapGenius was founded on the idea that rap lyrics needed explanation. And given that Andreessen Horowitz partner Ben Horowitz is a well-known rap devotee, there's an obvious hook that would attract the VC firm to help fund the startup.

"Given that RapGenius is a Web site where people explain rap lyrics, and given that my partner Ben is a noted rap fanatic, your first reaction … Read more

Venture capitalists offer up $2.1 billion in funding in Q2

Corporate venture-capital funding was on the rise during the second quarter of 2012.

Research firm CB Insights, which provides quarterly data on VC investments, revealed today that a total of $2.1 billion was offered up to startups during the second quarter in just 118 deals. The total invested capital nearly doubled the first quarter's $1.09 billion in investments. During the second quarter of 2011, funding hit $1.81 billion.

So, where is that cash going? According to CB Insights, Facebook's $1 billion acquisition of Instagram prompted corporate venture capitalists to flock to the mobile arena, where … Read more

Square perks up, now handles $8B in payments a year

Square is growing by leaps, bounds, and venti lattes.

The payment-processing company, which allows merchants to swipe cards with a device connected to mobile devices, today announced that it's now handling $8 billion in transactions every year. Just a year ago, that figure stood at over $1 billion, and earlier this year, Square CEO Jack Dorsey said the company was processing $4 billion in transactions per year.

That growth has meant far more revenue for Square. Although the company doesn't divulge its financials, it takes a fee of 2.75 percent for each card swipe through its service. … Read more

Ben Horowitz: I feel your IPO pain, Facebook

SAN FRANCISCO -- Venture Capitalist Ben Horowitz, half of the powerful Andreessen Horowitz duo, talked about how a lousy performing IPO -- are you listening, Mark Zuckerberg? -- can be a wrenching experience.

"The biggest pressure is on the employees who go home and someone in their family says, 'I read in the paper that you guys are bunch of idiots'," said Horowitz, who was interviewed at Techcrunch Disrupt by Silicon Valley veteran Bill Campbell. "It's a really hard thing to take."

Horowitz was talking about his experience as CEO of LoudCloud, a 1990s-era company … Read more

AngelList attacks another startup pain point: Legal fees

AngelList -- a booming site where angel investors find tech startups to back -- is rolling out a product today that should please a lot of would-be Mark Zuckerbergs and, in theory, worry a lot of lawyers.

Ultimately, it could help both.

The site, founded in early 2010 by entrepreneurs/angel investors Naval Ravikant and Babak Nivi, is now offering standardized online documents that will make it faster and cheaper for any of the thousands of startups on AngelList to close their first round of funding.

AngelList Docs, as it's called, breaks down the money-raising paperwork process in a … Read more

Y Combinator founder: Startup funding could get scarce

MOUNTAIN VIEW, Calif. -- The future for startup funding is "getting more unpredictable."

That's what Y Combinator founder Paul Graham said today, theorizing that because there are so many more young companies getting off the ground these days, venture capitalists may well have a much harder time predicting winners than in the past.

It makes sense. Startups can get going today for as little as a few hundred thousand dollars, so there are many more of them. "But the funnel at the top is the same," Graham said during the Y Combinator Demo Day. "… Read more

Thrillist Media Group raises a whopping $13M

In what started out as a small newsletter to 600 friends has grown into a company worthy of $13 million in Series A funding.

Thrillist Media Group, a man-about-town newsletter and e-commerce company, announced today that it has raised this wad of cash with funding led by Oak Investment Partners that has been joined by Lerer Ventures and Pilot Group. What's more, Fred Harman from Oak will be joining Thrillist's board of directors.

Thrillist was co-founded by Ben Lerer who comes from a family that knows about media. He's the son of Ken Lerer, who co-founded the … Read more

In the social media era, even VCs need personal brands

Nobody wants to admit it, but building a personal brand is essential if you want to thrive in a business world dominated by social media. This is especially true for entrepreneurs and even venture capitalists who have only recently stepped out from the shadows and into the spotlight.

I became intrigued by the rising role of personal branding in the VC world by a New York Times article last week that discussed how more VC firms are hiring PR specialists to help brand their firms.

Here's a quick excerpt from that article:

"Now, Sand Hill Road in Silicon … Read more

Five ways to screw up your startup's pitch

Pitching your startup idea to investors, journalists, and random people on the street is a rite of passage for all entrepreneurs. You have to convince hundreds (if not millions) of people that you're building something worthwhile and that they should get on board.

Most pitches fall flat though (the best VCs invest in perhaps 1 percent of the startups that pitch them), and it's often because of simple problems that could've been avoided. Nervous entrepreneurs stray from their story, and arrogant entrepreneurs demand unreasonable valuations and then get laughed out of the room by top-tier angels.

Here … Read more

Is venture capital broken? Hardly

Editors' note: This is a guest column. See Ashton Newhall's bio below.

Let's begin with our conclusion: Venture capital is not broken. It is thriving -- albeit in a smaller, more concentrated ecosystem of fund managers who are largely closed off to new investors.

In May, the Ewing Marion Kauffman Foundation - the world's largest foundation devoted to entrepreneurship - published a report entitled We Have Met the Enemy ... and He Is Us. It stated that the Foundation had a less than a positive experience investing in the asset class over the past twenty years. The report'… Read more