Category: Tech news

Editor’s note: William Carleton practices law in Seattle, blogs daily at Counselor @ Law and writes a weekly column on implementation of the JOBS Act for VC Experts. Follow him on Twitter at @wac6. 

Everyone passionate about the startup company funding ecosystem was overjoyed by the news last week that general solicitation would soon be okay for startups looking for angel investors.

With one fell stroke, the artificial networking inefficiency imposed by the ban on public communication would be gone. Entrepreneurs and accredited investors would be able to talk freely. Startups would have no impediments to tweeting, blogging, taking out Facebook ads, or engaging in any other kind of social media (or old media) to optimize both the chance to get funded and the chance to fully and expeditiously fill out financing rounds.

Nothing else about angel investing was supposed to change, other than the fact that startups would have to take “reasonable steps” to verify that their investors actually were bona fide angels, before closing the sale.

Fred Wilson wrote the following on his blog about the the SEC’s final rules on lifting the ban on general solicitation in offerings limited to accredited investors, now to be known as Rule 506(c):

What this means is that folks raising capital can now advertise the fact that they are doing so. I have been involved in raising close to ten venture capital funds and every time we do that, we have to be quiet about what we are doing until we’ve done it. That won’t be the case anymore.

But there’s a problem. And it’s not just that general solicitation doesn’t actually go into effect until sometime in September (see this great piece from Joe Wallin in the WSJ Accelerators, Time to Advertise Your Private Offering? Not So Fast). Though it wasn’t noticed, the SEC on the same day proposed for comment a separate set of rules that, if adopted, could undermine the general solicitation rule it had just voted to approve.

The effect would be to turn general solicitation of angel investors into a minefield filled with bouncing grenades.

This separate set of proposed rules introduces wholly new, wholly un-mandated concepts to Reg D, with new requirements, new filings, new deadlines and new penalties. The effect would be to turn general solicitation of angel investors into a minefield filled with bouncing grenades.

It’s as if the regulators thought they were implementing rules under Title III of the JOBS Act, pertaining to crowdfunding for unaccredited investors. But the Congressional mandate to make angel investing easier came instead under the angel financing section of the JOBS Act, Title II, which imposed no new information or filing requirements.

To be sure, Congress was concerned that permitting angel deals to be advertised might lead to hype. If startups went “tweeting for investors,” might that not tend to tempt unaccredited investors to shave the truth and misrepresent themselves as angels? To mitigate that risk, Congress instructed the SEC to come up with rules for startups to “verify” that all purchasers in an advertised deal are accredited.

But Congress never meant 506(c) angel deals to be subject to information requirements or the other complexities of crowdfunding regulation. You don’t have to read the JOBS Act in detail to appreciate this. Just glance at Title II (about a page) and then skim Title III (nine pages).

Probably the most onerous change proposed is a pre-filing requirement for Rule 506(c) offerings. That proposed rule requires startups to make a publicly available filing with the SEC 15 days in advance of any general solicitation or general advertising. If enacted as proposed, the new filing requirement would take Rule 506(c) deals — and particularly seed financings — out of the natural flow of discussion and negotiation between entrepreneur and angel. If the proposed rules take effect, startups — the best ones — will likely stick with 506(b), which has no pre-filing requirement.

And what of the proposal that startups “submit to the Commission any written communication that constitutes a general solicitation or general advertising in any offering conducted in reliance on § 230.506(c) no later than the date of first use.” Does that mean every tweet?

This one-year “penalty box” feature certainly wasn’t proposed by Congress.

Another onerous proposed change is one that would apply both to 506(b) and 506(c) deals: a one-year prohibition on using Rule 506 at all if you are late on filing a Form D, or late on amending a Form D, or late on filing a terminating amendment to close out a Rule 506 offering. This one-year “penalty box” feature certainly wasn’t proposed by Congress.
Congress should step in and say, “stick with the balance Congress has already struck; we meant to decrease friction in angel investing, not increase it.”

The startup community needs to rally and oppose these misguidedly proposed rules. Sure enough, the final rules establishing Rule 506(c) are already here and general solicitation in angel investing will soon be the law of the land, but the SEC’s proposed new Reg D rules and filing requirements, if adopted, will make general solicitation more of a burden than an efficiency.

The Freedom of Information Act Machine, an open online platform that automates Freedom of Information Act (FOIA) requests, launched on Kickstarter two days ago and has already surpassed its funding goal. At the time of publication, it had cleared $20,000 in funding from over 600 backers.

The issue is simple–the state and federal laws and processes for FOIA requests are complex, often purposefully so, and it can be a pain for even experienced reporters to navigate the process.

The FOIA machine does three main things: it automates FOIA requests; it tracks requests, their progress and the dates you filed them; and it aggregates information about FOIA requests and helps build information around how to improve FOIA requests in the future.

“Those who have abused public trust often are able to hide behind all of this bureaucracy,” the team explains on the Kickstarter page. “Their secrets, held in millions of government documents, simply won’t reveal themselves.”

Shane Shifflett, the FOIA Machine’s developer and a data reporter at The Huffington Post, tells me the team had expected to reach the funding goal in around two weeks and has been blown away by the response.

The FOIA machine, the usefulness of which should be pretty obvious in the wake of PRISM, will be open and free to anyone. The team says over 800 journalists have signed up to use it when it opens to the public, which Shifflett estimate should happen by Christmas.

The team, made up of investigative journalists, data scientists, and coders, put the project on Kickstarter, aiming to raise money to finish developing the site, improve its functionality, and to offset server costs.

The Center for Investigative Reporting (CIR) will be the FOIA machine’s home until it’s launched to the public, at which point it will be handed off to the nonprofit Investigative Reporters and Editors (IRE). Maybe they should start an Acronym Machine while they’re at it.

Shifflett says the extra money raised on Kickstarter will go towards more features (possibly the ability to pay FOIA fees that may arise) and an API; he says the group is currently drafting more official stretch goals beyond the original $17,500.

You can check out the Kickstarter page, which is unsurprisingly well written, and contribute here.

Image via.

DogVacay, the startup that runs a peer-to-peer online marketplace for dog boarding, has seen some nice growth in recent months, raising a nice chunk of venture capital money from big-name investors and recently crossing more than 10,000 hosts on its platform since its launch just over a year ago in March 2012.

It turns out that DogVacay has also made a name for itself as a startup to watch in its local Silicon Beach scene — while TechCrunch TV was visiting Los Angeles this past week, when we’d ask local techies what companies were heating up lately, DogVacay’s name came up quite often. So we made it a point to stop by DogVacay’s Santa Monica headquarters to see what all the buzz is about for ourselves.

Watch the video embedded above to get a quick look at DogVacay’s Santa Monica digs and hear CEO and co-founder Aaron Hirschhorn talk about DogVacay’s founding, growth, and plans for the future.

Windows RT is a dog. We’ve been saying that from the beginning. We weren’t alone. It’s very hard to find a positive review of Windows RT, and more specifically, the nine-month-old Microsoft Surface with RT. And now Microsoft, in its latest earnings report, finally revealed that we were right.

The company took a massive $900M writedown last quarter because of unsold Surface RT’s. Even more telling is that Microsoft actually revealed this loss. It’s that big. The company had to tell investors why it didn’t meet Wall Street’s expectations.

Sadly, the Surface RT hardware is not at fault here. The tablet itself is actually a beautiful machine: sleek, solid and downright stunning. It’s hard to pick one up and not be impressed. The Surface RT’s designers and engineers should be proud of their creation. It’s not their fault.

Windows RT should not exist as a consumer-facing product. It’s a reactionary move against the iPad and the multitude of Android tablets flooding the market. It’s Microsoft punching down where it should have just walked away from the fight. While Intel is quickly bringing most of the advantages of ARM chips to its x86 line, Microsoft decided it couldn’t wait and built a product that ignored Windows’ main advantages of legacy software. The Surface RT was sadly part of the ecosystem that is predictably failing.

The Surface product line was a big risk for Microsoft. The company went all-in on a PC for the very first time. And in a way, it was successful. The Surface RT and Pro brought a lot of attention to Windows 8 tablets — much more attention than HP, Dell, or Samsung could have provided. The striking product line put a lot of consumer electronic companies on notice, especially since Microsoft — historically a software-first outfit — took on the task of creating their own first-rate hardware. These tablets are the standard for Windows 8 tablets even if it’s clear after today’s news that they failed to live up to Microsoft’s expectations.

Without the Surface Pro and RT, the Windows 8 tablet world would be as stale and lifeless as Windows 8 laptops.

All signs point to a new Surface line being announced in the coming weeks. And even with today’s news, it’s entirely possible that Microsoft will release a second generation Surface RT with a starting price point much lower. If anything, Microsoft is a company that does whatever the hell it wants even if no one is buying the products.

There are a lot of new YouTube stars out there, dudes who have a bunch of subscribers to their channels, watching their videos and whatnot. But sometimes it’s tough to make a ton of money from YouTube. I mean, advertising isn’t everything it’s cracked up to be, and then you share some revenue with YouTube and the next thing you know there’s not that much left.

They’ve got a lot going for them. I mean, it’s cheaper than ever to buy a camera and get started and edit your stuff together and, man, there are a ton of people on YouTube. But they just wish they could make a little more money, you know. It’s hard out there being a YouTube creator.

I mean, you’ve just gotta keep churning out the videos. You know, feed the beast.

So anyway, there’s this company called FanHero. It’s all about helping those YouTube guys make money in, like, non-advertising ways. Giving the community ways to support them through commerce — you know, selling stuff. It’s like the classic merch model, like how you go to your favorite band’s show and you buy a t-shirt or a CD.

But with this you don’t have to go anywhere. You’re just on the Internet and then — BOOM — you can buy their t-shirt right there. Oh yeah, and you can pay what you want. Like, it gives you a suggested amount to pay for a t-shirt or a poster, and it tells you how much your favorite YouTuber gets from that.

So let’s say a t-shirt costs $13 and it suggests you pay $23. I mean, you don’t have to, you can pay less. Maybe you’re waiting for your paycheck from Hot Topic and you’re short on money this week. You can pay $15, NBD. Just remember to pay more next time, you know, so these guys get SOME MONEY. I mean, what kind of fan are you, anyway?

Oh yeah, there’s also a leaderboard and a place to show who’s buying the most stuff, not to show off or anything just to show everyone how awesome the community members are, and like, a list of who’s going above and beyond. Like that dude who paid $50 for a $13 t-shirt. That’s a whole $30-some dollars, I guess almost $40, that went to that YouTube guy. Every little bit helps, man. Every little bit.

Anyway, if you’re on YouTube and have a bunch of fans, it’s really easy to set up. Just make an account and upload an image and FanHero will put it on stuff. Posters, t-shirts, iPhone cases. You know the drill. And then you tell your millions of subscribers about it and they buy your stuff and you get a check, as long as you’ve made $100 or more that month.

It’s that easy. Maybe you don’t have time to make a new video this week, but hopefully this’ll give you a little spending money in the meantime, I mean, until you can upload something new and get those views up.

The guys behind FanHero are these Stanford CS undergrads Kevin Xu and Charlie Guo, who like, grew up on YouTube idolizing YouTubers. These guys don’t remember a time when the world’s biggest stars weren’t on it. They’re in Y Combinator now because that’s where all the cool kids go to learn about the Internet and monetizing and stuff.

For now, FanHero is letting creators keep all the money from the sales of stuff on the site, while it’s in beta and testing stuff out or whatever. After September they’ll cut that down to 75 percent because, you know, they should get paid, too.

Yelp has just announced that they’ve agreed to acquire SeatMe, the startup that set out to battle OpenTable in the restaurant reservation space.

No word yet on the acquisition price, though we’re digging. Update: Looks like they acquired them for $2.2 million in cash and 263,000 shares of common stock, pinning the acquisition price at a total up to $12.7 million.

SeatMe’s main offering is part web service, part iPad app. The web app lets restaurant owners easily add an online reservation system to their own site or Facebook page, while the iPad app lets the restaurant’s host/hostess manage their tables on the fly. It also has a few other neat tricks, like texting customers when their table is ready, or flagging a return customer’s known allergens and seating preferences.

Competitor OpenTable has been powering Yelp’s integrated reservation since around June of 2010 — this acquisition presumably means that that deal will dry up sooner than later (Yelp tells us they “believe SeatMe complements [their] existing partnerships.”) As pointed out by commenter Max Lemos, below:

While at LeWeb London 2013, Jeremy Stoppelman, Yelp’s CEO, was pressured time and time again to talk about their open table partnership. No wonder he was so tight lipped future plans and if anything spoke a little to rosey about them.

Yelp says that they’ll be bringing the SeatMe team in to help them build out their own reservation system, expanding their time-slotting offerings from just restaurants and night clubs to things like spas, dentists, and salons. As for what this all means for current SeatMe customers? That… goes unmentioned. We’re reaching out to Yelp/SeatMe for clarification there.

Update: From an email sent to SeatMe’s current customers, it sounds like the service will go on:

How does this change your SeatMe service? It doesn’t. We will continue to provide the same great product and service that we hope you’ve come to love and rely on.

We’d actually spotted SeatMe listed as a “potential acquisition” on one of Square’s hiring pages (of all places), so we had a feeling that the company was looking for a buyer. Seems like Yelp won out in the end, though. That same page also listed the crowd-sourced design startup Chirply as a potential acquisition — so keep your eyes peeled there.

Microsoft just posted its earnings for its fourth financial quarter of 2013. The company reported revenue of $19.9 billion and earnings per share of $0.59. While that’s in line with analyst expectations, it’s worth pointing out that most analysts had revised their estimates downward over the last three months.

The Wall Street consensus was that Microsoft would report $20.74 billion in revenue and earnings per share of $0.75.

The surprise in this release is that Microsoft says it’s taking a $900 million charge “related to Surface RT inventory adjustments.” That’s quite a blow for Microsoft, which put a lot of resources into this project, which launched to middling reviews and failed to catch on with customers.

In the year-ago quarter, Microsoft reported $18.06 billion in revenue and a loss per share of $0.06 — the first quarterly loss per share in the company’s history — because of a massive writedown after its failed aQuantive acquisition.

“While our fourth quarter results were impacted by the decline in the PC market, we continue to see strong demand for our enterprise and cloud offerings, resulting in a record unearned revenue balance this quarter. We also saw increasing consumer demand for services like Office 365, Outlook.com, Skype, and Xbox LIVE,” said Amy Hood, chief financial officer at Microsoft. “While we have work ahead of us, we are making the focused investments needed to deliver on long-term growth opportunities like cloud services.”

One factor that has been hurting Microsoft — as well as chip giant Intel and others in the PC business — is the general downturn in the PC market and the relatively lackluster reception of Windows 8. As research firm Gartner reported, global PC shipments dropped 11 percent in the last quarter, and while Microsoft has enough other business units to still make a massive profit, this drop definitely weighed on its Windows division. One factor that softens this blow, though, is the fact that many businesses are finally upgrading their old XP machines to Windows 7.

One area many pundits continue to look at is Microsoft’s Online Services Division, which reported an $8.1 billion loss in the year-ago-quarter. Since then, though, this division slowly reduced its losses, and last quarter, it was “only” $262 million in the red. This time around, the Online Services division reported a revenue increase of 9% but still posted a loss of $372 million.

For its fiscal year 2013, the company’s revenue, operating income, and diluted earnings per share were $77.85 billion, $26.76 billion, and $2.58 per share.

Here are the earnings for Microsoft’s main business units:

• Windows Division: 1.09 billion profit on $4.411 billion in revenue
• Servers and Tools: $2.33 billion profit on $5.502 billion in revenue
• Online Services: $372 million loss on $800 million in revenue
• Business Division: $4.87 billion profit on $7.231 billion in revenue
• Entertainment and Devices: $110 million loss on $1.915 billion in revenue

Earlier this month, Microsoft announced a major reorganization of its business units under the “one strategy, one Microsoft” banner. The company is now organized by function (engineering, marketing, business development and evangelism, advanced strategy and research, finance, HR, legal and COO). This reorganization obviously didn’t have any influence on this quarter’s results yet, but given that Microsoft is doing this to become more nimble, the company itself surely expects to see some results within the coming quarters.

It’s that time again — Google’s fiscal second quarter earnings have just crossed the wires and they’re definitely not what most people expected. For Q2 2013, the company reported consolidated revenue of $14.1 billion (that’s up 19 percent from the year-ago quarter), net income of $3.23 billion, and non-GAAP earnings per share of $9.56.

In the days leading up the release, analysts expected the web giant to post some strong numbers — the consensus estimates according to Yahoo Finance pegged the company as posting non-GAAP earnings of $10.78 per share and $14.42 billion in revenue, both figures that Google couldn’t quite live up to this time around. If there’s anything close to a silver lining there, it’s that analysts were hoping to see Google’s revenue jump at least 20 percent year-over-year, and the company only missed that by about 1 percent.

Google’s stock hit an all time high earlier this Monday before settling down a bit, and at time of writing the stock’s price is down over 5 percent in after-hours trading.

Of course, not all is as bad as it seems, no matter what some jumpy analysts think. Google’s total ad revenue was up 15% this quarter, which is rather nice considering it’s how Google makes most of its money. Speaking of ads, some folks are probably eyeing up Google’s paid clicks and cost-per-click figures, especially in light of reports from both The Search Agency and Adobe (via VentureBeat) that pointed to a likely upswing in both rather the divergence we usually see. As it happens, those reports didn’t quite tell the whole picture — Google’s paid clicks were up 23 percent from the year ago quarter, while average cost-per-click was down about 6 percent from the year ago quarter. Meanwhile, Google’s traffic acquisition costs surged to $3.01 billion from the $2.6 billion it reported Q2 last year.

And then there’s Google’s once-quiet mobile hardware division. After keeping mostly to themselves after being acquired by Google last year, Motorola Mobility opened up earlier this month to tease the forthcoming Moto X, a seemingly mid-range smartphone that’s expected to make waves thanks to a low price tag and some novel customization options. I suspect Google’s brass will be doing plenty of Motorola cheerleading a little later on today (it’s become something of a tradition now), but the company reported that its mobile hardware subsidiary accounted for only $998 million of Google’s overall revenue — that shakes out to about 7 percent. That’s awfully low even for Motorola, but you can’t really blame them since they haven’t pushed out much in the way of new devices lately… though it does explain why Motorola reported a GAAP operating loss of $342 million.

As usual, Google will hold a conference call to discuss the company’s quarterly performance at 4:30 PM Eastern/1:30 PM Pacific. You’ll definitely want to stick around to see what happens — even though CEO Larry Page called Q2 a “great quarter”, he’s going to face some serious questions from curious analysts.

Yahoo has acquired Ztelic, a Beijing startup focused on social-network data, as first reported by the Wall Street Journal. This is Yahoo’s second acquisition in as many days (something they’ve already done once this summer), and the company’s 19th acquisition under CEO Marissa Mayer.

A Yahoo spokeswoman says the deal is “part of our investment in our R&D efforts” and that eight Ztelic developers and engineers will be joining Yahoo’s research and development team in Beijing.

“Ztelic founder and returning Yahoo, Hao Zheng, will play a critical leadership role in our Beijing Global R&D Center,” the Yahoo spokeswoman tells me. “Hao will split his time between Beijing and Sunnyvale, and the rest of his team will be based in Beijing.”

Ztelic will reportedly sunset its product as it joins Yahoo.

Terms of the deal were not disclosed, but as we learned on Tuesday during Yahoo’s earnings call, the company has plenty of cash left for acquisitions.

We’re here, Seattle. And boy is it nice. Blue skies, cool weather, and great startups. We’re loving it.

Tonight, at 6:00, TechCrunch is taking over the ShowBox at the Market for an evening of good times and startup pitches. After sorting through over a hundred applications, we selected 20 companies to take part in a rapid-fire pitch-off competition to be judged by TechCrunch editors and local VCs.

There are still a few tickets left for the event. We will also sell a handful at the door, but by cash only. They’re $5 and include a couple of drinks. 21 and older only, please.

These meetups are part pitch-off competition and part meet-your-neighbors shindig. Tonight, nearly a thousand entrepreneurs, tech fans and venture capitalists will be gathered under one roof. Come with your pitch deck locked and loaded, and a pocket full of business cards. Tonight’s going to be epic. There ain’t no party like a TechCrunch party.

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Los Angeles-based content delivery network EdgeCast Networks is looking to expand its sales and engineering teams, and it’s raised a fresh round of $54 million in new financing to help it do so. The funding was led by Performance Equity Management (PEM), with participation from existing investors Menlo Ventures and Steamboat Ventures.

EdgeCast has been around since 2006, and has only raised about $20 million in that time from Menlo and Steamboat. According to EdgeCast president James Segil, the company has been profitable for the last four years, and currently has a $100 million run rate. So if that’s the case, why bother raising money now?

“Because chicks dig guys with cash,” Segil told me.

No, seriously.

“There’s a saying that you should raise money when you don’t need it,” he said. And so, with that in mind, the company took on a whole lot of funding as it looks to expand in a number of ways.

First and foremost, it’s looking to hire more salespeople, to get more feet on the street and accelerate its growth. To date, most of its sales operation has been based in its Los Angeles headquarters, but it’s hoping to add more sales offices nationally and internationally. By doing that, it will be able to get in front of more customers and help explain its increasingly differentiated products to them.

Speaking of, it’s also looking to boost engineering and work on new products. Segil said he’s hoping to get more skunkworks projects going to strengthen its product suite. As a CDN, he explained, the company is building both software and network infrastructure. Either one is difficult on its own, but doing both can be a challenge. EdgeCast sees ways that it can better optimize its infrastructure, improve routing, stuff like that. So hey, mo’ engineers is mo’ better.

EdgeCast has more than 6,000 customers today, including some big names like Twitter, Pinterest, Tumblr, and Hulu. Of course, many of them use multiple vendors for content delivery — that’s to be expected — but revenue and usage continues to grow as it signs up more customers and gets them delivering more bits via its network.

So why PEM? Well, it’s a fund of funds and already has a stake in EdgeCast through its investment in Menlo. Having that connection and an understanding of the company’s business already was one reason that EdgeCast decided to take investment from the firm, Segil told me.

Superfly, which helps travelers take advantage of frequent flier miles and airline rewards programs, is expanding its services to include a mobile app for finding and booking hotels.

Superfly first launched at TechCrunch Disrupt SF in 2010 and uses big data to personalize flight results based on consumer travel records. In April, Superfly developed Superbox, which allows users to organize all travel-related emails. This makes it easier to track rewards and frequent flier miles. Now the company is using the same model to help users take advantage of hotel rewards programs and promotions: Superfly Hotels.

Available for iOS, Superfly Hotels delivers personalized hotel results, including hotels you or similar customers have stayed in before. Superfly will also offer cash back on hotel spendings, starting from 5 percent for all users, and increasing up to 10 percent based on booking frequency.

With the launch of Superfly Hotels, Superfly is catching up to travel sites like Expedia, Orbitz and Priceline that already have mobile hotel booking apps available. However, Superfly has an advantage over its competitors– a large data set of hotel bookings collected from travel emails from Superbox.

“The word big data is thrown around a lot, but for us big data is all about identity, context and location,” Superfly founder Jonathan Meiri tells me. “Knowing this about the consumer, we’re trying to get all this massive data and help consumers make really simple choices around which hotel is best for them.”

Meiri says Superfly has collected information on billions of dollars in hotel bookings. With this information, Superfly can recommend hotels where you are a regular patron or can use rewards programs. Or if you usually travel with one airline, Superfly will display which hotels are preferred by that same airline’s customers.

Superfly has attracted investors such as former Kayak CFO Bill Smith and TravelPort Chairman Jeff Clarke. The company also recently added another recruit from Kayak. Jacqueline LoVerme, Kayak’s former director of business development-mobile, connected with Meiri through Smith and is now Superfly’s vice president of business development.

Meiri says Superfly Hotels is working on versions for Android and web. You can download the iPhone app here.

Would you install an Android app that put ads directly on your smartphone’s lock screen? No? What if you were paid to do so, and whenever you swiped to unlock your device, you made a little money? That’s the promise of a new mobile application called Locket, launching today for Android, backed by $500,000 in funding from Great Oaks VC and a couple of undisclosed angel investors from the entertainment and marketing industries.

The New York-based startup was founded in March by Yunha Kim, Paul Jang, and Christopher Crawford, and is currently working out of a Manhattan apartment where five founding team members live and work alongside their three dogs and a hamster.

Kim tells TechCrunch that the startup closed on the Great Oaks funding just three days after its pitch – their first VC pitch ever, she notes.

Before building Locket, Kim graduated magna cum laude from Duke University and worked as an investment banking analyst at Jefferies.

“Working in banking, my only outlet to my outside life was my phone,” she says. “And looking at my lock screen – which was just a picture of a daisy – the question was, ‘how do we monetize that?’” The idea inspired her to team up with fellow Duke grad Jang and Crawford, whose background is in advertising.

The company thinks there’s room to define a new market for mobile advertising, which they’re calling “first glance” ads. The idea is already taking off in some overseas markets like Korea, where similar businesses have achieved over 20 percent of Android market share penetration in three months after their debut, Kim explains. However, in the U.S., where Locket is currently focused, it’s basically untapped.

The experience of Locket is not all that different from those lock screen ads on some Kindle devices. But instead of forcing users to view the ads, like the ad-supported Kindles do, users have the choice to engage or not. They can choose to engage by swiping in one direction to be directed to a website, Facebook Page, coupon voucher, or movie trailer, for example, or they can go directly to their homescreen by swiping the other way. Regardless of whether they “click-through,” users are paid 1 cent per swipe, capped at 3 cents per hour for now.

Ads will also be targeted using social profile data from Facebook (or a brief questionnaire), geolocation, other app usage, and engagement history.

At launch, Locket has a limited selection of about eight advertisers on board, and will also be running house ads to fill the space. However, Kim says that in around a month, they plan to offer ads from more than ten advertisers. The company also has deals in the works with two larger Fortune 500 companies, but she’s not allowed yet to disclose them by name.

Not all advertisers will be accepted, as Locket’s goal is to respect the very personal landscape that is the mobile phone lock screen. The startup has already rejected ads from alcohol and lingerie brands, for instance, as well as one for a mobile app that wasn’t well-designed.

After an advertiser is approved, the turnaround time to get their creative onto users’ phones is about two weeks. Locket also has an in-house creative team, and a technical crew that tests ads on 20 top Android smartphones they keep in the office (um, apartment). They do try to achieve compatibility with most leading Android phones, but the market today includes some 1,600 devices, so the long tail may still experience issues during Locket’s beta, which begins now. The company claims they’ve also worked hard to limit the impact on battery usage.

Advertiser costs vary, but the goal is to push Locket over $10 CPM, eventually hoping to top Flipboard’s $30 CPM for its in-app, full-screen ads, says Kim. “We want to be able to charge more than that because we’re front of your mind, right in front of your face. Whatever you’re doing, you’ll see the ad on the lock screen.”

Will Consumers Bite?

Locket’s launch comes at a time when Facebook’s move to take over users’ Android lock screens – and devices – has been met with some resistance. Facebook’s Android launcher Home has not yet been the success the social network hoped for, but there are parts of the experience users liked. One of those parts is the “Cover Feed” which brings images and status updates to the Android lock screen. What made users uncomfortable, however, was news that Home would one day include ads on this screen, as well. Users didn’t like the idea of having ads forced upon them, but Locket works around that psychological hurdle by offering to pay users for their time.

One cent per swipe, and no more than 3 cents per hour (at least, for now), is not much money, of course. But given how much users interact with their phones it’s easy money that could add up over time. Maybe you won’t make but a few dollars per month at first, but as more advertisers come on board, that could change. If anything, the couponing craze and success of rewards sites like Swagbucks demonstrate there’s at least a portion of the market that will work hard for little reward. Locket, meanwhile, requires very little user effort.

“What we’re trying to do is change the perception people have towards ads. On mobile, ads suck right now,” says Kim. “But our ads are different because they’re beautiful and they actually reward you for your glances. We hope users will like it.”

Locket is a free download on Google Play here.

Mexico’s SinDelantal.Mx, the online takeout delivery service started by the founders of Spain’s SinDelantal.com, has raised €2.5 million from Spanish VC Seaya Ventures.

Seaya’s Michael Kleindl was a previous backer of Spain’s SinDelantal, which exited to Just Eat late last year for a figure we pegged in the range of “a few million dollars,” so he knows its founders, Diego Ballesteros and Evaristo Babé, fairly well. But perhaps most notable is that Just Eat, despite having no stake in SinDelantal.Mx, has allowed the startup to re-use the SinDelantal name in its bid to give the other major players in the region, Rocket Internet’s Food Panda, and Delivery Hero/Team Europe’s Superantojo, a run for their take-out money.

And with Just Eat not having a presence in Mexico (though it does operate in Latin America via Brazil), might we be seeing history repeating itself? The Spanish version of SinDelantal pre-existed Just Eat’s operation in Spain, after all, and we know how that panned out.

In addition, the official announcement notes, “thanks to the technology developed for SinDelantal.com in Spain, the launch has been carried out in a quick and agile way.” Can we say, rinse and repeat?

To that end, some numbers. Launched in 2012, SinDelantal.Mx claims it’s already a leader in the Mexican online takeout delivery market. The startup says it works with 1,000 restaurants in Mexico City, receiving over 10,000 orders each month, a metric its achieved in half the time it took for the founding team to do in Spain.

The company is also talking up Mexico as a whole, noting that it has 47 million Internet users, pushing it into second place in Latin America in terms of online shoppers (Brazil holds the top spot). Meanwhile, it says that nearly 50 percent of online shoppers make purchases via mobile phones, and that e-commerce in the country is seeing a yearly growth rate of nearly 50 percent. Better still, the online delivery market in Mexico is said to be 10 times larger than in Spain, making the takeout space a tasty proposition.

These are sentiments echoed by Seaya’s Kleindl. “I am personally, and we at Seaya are, very bullish on Mexico in particular,” he tells TechCrunch by email, noting that it is a “huge market” with a population of 120 million and a “very healthy macro-economical climate,” which is growing.

“For SinDelantal it is an outstanding opportunity because the take-away and home-delivery culture is so strong; that’s why we estimate the market potential being 10 times that of Spain,” he says. “We know the founders very well. They did a fabulous job in the first one and will do it again now with more financial backing, more experience in a much larger market.”

We live in a world where Netflix is receiving Emmy nominations. The streaming video company received an unprecedented number of Emmy nominations — 14 in all. That included nine nominations for the Kevin Spacey-led political drama House of Cards, three for Arrested Development, and two for Hemlock Grove.

There are some who might say that Netflix’s nominations aren’t a big deal, and that most of them came on the strength of one big show. But that line of thinking ignores just how quickly this all came to be.

Netflix’s Emmy nominations came just two years after it first announced its plans to get into original programming with House of Cards, and a little more than a year after its first original series, Lillyhammer, actually launched on the service. Those nominations show that Netflix is becoming a real player in TV, and that it can compete with the big boys and is working to do so.

So Netflix isn’t HBO yet. That network might have racked up more than 100 nominations, but it’s been doing this original programming thing for more than 20 years. What’s important isn’t the number of nominations Netflix received, but that it is in the running at all.

That’s because it isn’t what you’d think of as a traditional TV network. It has no linear programming, and all shows are distributed in an on-demand fashion. It doesn’t have weekly release schedules for its episodes, it just makes the entire season of a show available all at once.

Most importantly, Netflix isn’t broadcast over the air, nor is it piped into your house via coax or beamed via satellite the way HBO and all the other cable networks are. Instead, it’s transmitted digitally — and not just to your TV, but to your computer, to your tablet, to your mobile phone.

That’s why Netflix being recognized by the Academy of Television Arts & Sciences is so significant. Two years ago, Netflix was a place where people watched reruns of their favorite shows and bad movies on their computers. But now it’s making TV series. And good TV series at that.

We’ve seen this play out before. It’s difficult to imagine now a world where the way you got your TV mattered, but I’m old enough to remember getting hooked up for cable and being able to watch Peggy Sue Got Married and Howard the Duck on HBO. Thirty years ago, cable networks emerged but mostly ran syndicated, rerun TV shows and B movies. Then pioneers like HBO began making their own shows. And now the cable networks are generally making better TV than the broadcast networks are.

All of which is why many people are excited by this next wave of TV. Netflix is at the forefront of this change, but we’re seeing original programming also emerge from other streaming providers like Amazon Studios and Hulu. They might not be Emmy-ready yet, but it seems like only a matter of time.

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