The Strand 🌴 - February 10, 2019
Calling all to the LA Tech Summit on February 21st, CAA and Sound Ventures pour more money into Calm, GOAT raises $100M from Foot Locker, and Tesla is buying Maxwell Technologies.
Welcome to the twenty-first edition of The Strand, a weekly-ish newsletter covering venture capital, private equity, and general business news from around the Los Angeles area. My name is Brendan Boken, a native of Southern California. Feel free to connect with me on LinkedIn, send deals/news to brendanboken@gmail.com.
Upcoming Events
Stage Venture Partners, in concert with the Central City Association of Los Angeles, is hosting the Downtown Los Angeles Tech Summit on February 21st. Fifteen B2B/enterprise startups, all seed-funded and a few past Series A, will be showcasing their technology to an audience of 300+ executives from the corporate world in Los Angeles.
Confirmed speakers include the founders of the following startups: Elementary Robotics, Shipsi, Smart CSM, InvolveSoft, OpenPath, Best Food Trucks, First Resonance, ListReports, OrderMark, Placer, Retina, and Storyblaster.
In addition to the startups presenting, the event will also showcase a panel of corporate technology executives speaking about their spending priorities, their procurement processes, and their favorite new technologies. Confirmed speakers include: VP of Technology, 21st Century Fox; VP of Product, Digital and Technology, CBRE; Chief Engineer & Central Plant Manager, California State University; Former CIO, Ares Management; CIO, Anschutz Entertainment Group; Moderator: Jonathan Shieber, TechCrunch
Date: February 21st, 8:30 am to noon
Location: California Market Center, 110 East 9th Street, Downtown Los Angeles, 90079
Venture Capital Funding
Calm, a 6.5-year-old, San Francisco, California-based meditation and wellness app, has raised $88 million in Series B funding at a $1 billion valuation led by TPG Growth, with participation from Los Angeles-based CAA, Insight Venture Partners, and Beverly Hills-based Sound Ventures. TechCrunch
GOAT, a four-year-old, Culver City, California-based sneaker marketplace, has raised $100 million in strategic funding from Foot Locker. The investment will eventually lead to Foot Locker and Goat combining their efforts across both companies’ digital and physical retail platforms. TechCrunch
Little Spoon, a two-year-old, New York, New York-based direct-to-consumer baby food company, has raised $7 million in funding led by Vaultier7. Other investors in the round include Kairos, Los Angeles-based Tinder founders Sean Rad and Justin Mateen, Interplay Ventures, The San Francisco 49ers, and SoGal Ventures. TechCrunch
Prima, a new Santa Monica, California-based plant wellness brand, raised $3.725 million in seed funding. Lerer Hippeau led the round and was joined by investors including Greycroft. Fortune
Ritual, a two-year-old, Los Angeles, California-based subscription vitamin service, has raised $25 million in Series B funding led by Norwest Venture Partners, with participation from Forerunner Ventures and Founders Fund. TechCrunch
Signal Sciences, a 4.5-year-old, Los Angeles, California-based firm that helps customers secure their web applications, has raised $35 million in Series C funding led by Lead Edge Capital, with participation from CRV, Index Ventures, Harrison Metal, and OATV. TechCrunch
Transient Plasma Systems, a nearly one-year-old, Torrance, California-based company that develops nanosecond pulsed power systems that warm plasma for a variety of applications, has raised $8.5 million in Series A funding from Kairos Ventures. Transient Plasma Systems- Press Release
Private Equity Funding
Insignia Capital Group agreed to acquire a “significant” minority stake in MediaAlpha, a Los Angeles, California-based marketing technology company. The deal values the company at approximately $350 million. Business Wire
Liquidity / Exits / M&A
Tesla is buying battery-technology company Maxwell Technologies for about $218 million in stock. The purchase price of $4.75/share amounts to a ~55% premium to its closing price on Friday, February 1st. Bloomberg
New Funds
No Los Angeles-based firms announced new funds this past week.
IPOs
No Los Angeles-based companies filed for IPOs this past week.
Featured Jobs
9 Count, Inc., a company on a mission to create the world’s best online community, is hiring a Senior Software Engineer in the company’s Venice office.
TikTok, Inc., a short-video sharing app and social network, is hiring a Program Manager in the company’s greater Los Angeles office.
Within, the premier destination for innovative, entertaining, and informative story-based virtual and augmented reality, is hiring a Mobile Engineering Lead in the company’s Culver City office.
News, Resources, & Required Reading
Bird founder and CEO Travis VanderZanden spoke with Mark Suster about unit economics, competitors, and seasonality at the Upfront Summit in Malibu a couple weeks ago. Some interesting takeaways from the fireside chat:
On improving unit economics in 2019: “Clearly the unit economics didn’t work on those scooters but that was a test anyway… Once we knew people liked riding them, we quickly scrambled and started creating our own scooters. Bird Zero is the first iteration of that. What we see on the unit economics of those, it’s like night and day.”
VanderZanden on seasonality: “Obviously, there is seasonality in the scooters business, there’s no doubt about that,” he said.“Yes, it’s slower in December but this market is so big, even in our slow [weeks] most companies would love to have that in their best [month].” VanderZanden also revealed Bird operates on a $100 million revenue run rate even in the winter.
Lessons learned from a logistics perspective: “We used to say when we’re heading into the holiday season that the Birds would migrate south but it turns out the logistics are really expensive, so the Birds hibernate.”
E-scooter injuries are creeping up after the first full year in cities. A UC Los Angeles study from last month looked at two Southern California hospitals and the number of electric scooter injuries reported there for about a year. It totaled 250 people sent to the ER and 100 with head injuries. Mashable
In case you missed it, Jeff Bezos published a blog post on Medium this past week accusing American Media Inc, the publisher of The National Enquirer, of extortion as the entertainment website threatened to release compromising photos of him. Jeff Bezos - Medium
Is VC Still A Thing? Mark Suster, Managing Partner at Upfront Ventures, took a look at the venture capital industry heading into 2020. Mark presented the deck at the Upfront Summit two weeks ago and gives a detailed look at where the industry is going as well as why the future of VC still looks bright. Mark Suster - Slideshare
Last year, Match Group acquired a 51 percent stake in dating app Hinge, in order to diversify its portfolio of dating apps led by Tinder. The company has now confirmed that it fully bought out Hinge in the past quarter, and owns 100 percent of the app. Terms of the acquisition were not disclosed. TechCrunch
Lime announced it has raised $310 million for its Series D round. Bain Capital Ventures led the round with participation from Andreessen Horowitz, Fidelity Ventures, GV, and IVP. The round values Lime at $2.4 billion and will give the company the ability to expand into new markets, enhance technology, and hire more people. The valuation is similar to Santa Monica-based Bird’s most recent funding round valuing the company at $2.3 billion. TechCrunch
Softbank has deployed roughly $50B of its $100B Vision Fund in less than two years, prompting discussions about when the world’s biggest technology investor will look to raise Vision Fund II. Wall Street Journal
These 5 companies relocated from SF to LA - here’s why. Built in LA
Topgolf and Los Angeles-based e-sports company Super League Gaming have announced a partnership to bring competitive video gaming events to Topgolf venues across the United States. Hollywood Reporter
Uber’s Secret Gold Mine: How Uber Eats Is Turning Into a Billion-Dollar Business To Rival Grubhub. Forbes
WeWork has signed a lease on its 3rd Santa Monica office at 3000 Olympic Boulevard. The new location will be the co-working company’s twentieth in the LA area, with locations ranging from Burbank all the way to Long Beach. Built in LA
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L.A.’s Weirdest, Most Niche Coworking Spaces.
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See inside Kylie Jenner’s playful, bright Hidden Hills home.
Star Sommelier Roni Ginach Is a Natural Winemaker’s Best Friend.
The Most Expensive Listings in Los Angeles.
This Boston fan is just 13 years old, yet has been alive for nine championships by his hometown teams. Bleacher Report