Category: Tech news

Cinemagram, a startup founded in Montreal that’s now moving to San Francisco, today announced an $8.5 million Series A round via AllThingsD. The investment comes from Menlo Ventures, Khosla Ventures, Real Ventures and Atlas, and stands as an exception to the decidedly reserved climate for follow-on capital after a startup’s seed round. So what’s Cinemagram’s secret?

The app is a cinemagraph generator. If you’re not familiar with the term, that’s basically a fancy GIF. The concept was popularized by Jamie Beck and Kevin Burg, fashion photographers who created the dramatic moving images that feature areas of movement in otherwise static scenes. Cinemagraph was among the first to bring this concept to mobile devices via an Instagram-style app, though the concept was also being developed by a Toronto-based studio around the same time and hit the App Store later as Flixel (which raised its first funding in July, though the amount wasn’t released). I’ve spoken with both teams, who have different visions about what users are looking for in this category of product.

Cinemagram seems to be winning out, with its focus on in-stream animated previews, and its early-mover advantage (though rival Kinoptic actually predated both it and Flixel). The app recently claimed a rate of growth of around 100,000 new users per day according to AllThingsD, and though that has since dropped to the tens of thousands, growth remains steady. The app also shifted earlier this year from a paid to a freemium model, following the introduction of Flixel which debuted as a free app, and that has likely helped its continued adoption.

A big part of Cinemagram’s appeal to investors, besides its similarity to previous superstar Instagram, is that it manages to be a way for users to share video-like content without the hassle involved in video. Few mobile video apps have managed to capture widespread consumer attention for very long, and for good reason: making video, even mobile ones, is a time-consuming process that involves a lot more work than snapping a photo. With Cineamagram, users get a product that is nearly as visually interesting as video, but also much easier to produce and consume – load times and bandwidth requirements are way below what you’d get with full mobile video. And refinements to the product, including frequent updates to help with image stabilization, mean that users can come on board quite easily and make their own “cines” (what Cinemagram calls its GIF-like images) quickly.

Cinemagram’s plans for the funding reportedly involve building out its backend to handle additional scale, according to co-founder Temo Chalasani speaking to AllThingsD. In a phone interview I conducted with Chalasani, he said that the company is actively and aggressively hiring new talent as well.

“We have some of the highest engagement in mobile social apps, and they saw what kind of a team we had and how we were able to make products and they invested in that,” Chalasani added, discussing how this round came together. “It was actually an extended, gradual process where we worked with our investors and they saw what we were capable of, rather than any one thing.”

The company behind Cinemagram, Factyle, raised $150,000 in seed funding from Real Ventures, and raised an additional $1 million convertible note during this past summer from the same investors who participated in this round. Menlo’s Shervin Pishevar also joins the Cinemagram board as part of the funding arrangement.

EMC Chief Strategist Paul Maritz will lead a new platform group that will combine VMware’s Cloud Foundry, SpringSource, and Gemstone with EMC’s big data platform – Greenplum.

According to sources close to the company, EMC will announce the news next week. It’s unclear whether other groups will be affected by the move. As part of the new group, about 1,000 people will move from VMware to work under Maritz who left VMware as CEO this past summer.

GigaOm first posted on the news earlier this week. Hat tip to Barb Darrow for getting to the news.

EMC declined to comment for this story. VMware executives did not respond to requests for comment.

When Maritz left VMware, I wrote that he would be leading a potential spin out of a group that would include Cloud Foundry. Some scoffed at this, but now things are starting to makes sense. This is a smart move.

Cloud Foundry is the much-heralded platform-as-a-service (PaaS) that VMware launched in 2011 as an open project. It gained a fast following and has since served as the basis for its use as a service to build out platforms on public or enterprise data infrastructures. Partners include AppFog and Tier3. SpringSource is the Java framework that VMware acquired in 2009. It has gone largely underutilized under VMware. Gemstone is the distributed in-memory data cache solution that has been doing well but mostly because the group had its own customer base before moving inside to VMware. On the EMC side of the fence, Greenplum is the big data analytics platform that EMC acquired in 2010. It has since shown strong growth, as big data is the focus at EMC.

A source said to me at AWS re:Invent this week that VMware is more of a management systems company these days. Its core service is increasingly as a company that manages data centers with an emphasis on using its number one spot in the virtualization market. Cloud Foundry fits far better with SpringSource and Gemstone at EMC than at VMware.

Under Maritz, there will be the freedom to create a compelling package that bridges a platform play with a Java framework and a data-driven underpinning with Greenplum. It’s also great for Maritz, who is an innovator at heart. He can lead this new group with the freedom to look beyond and perhaps even partner with Amazon Web Services.

Evernote, the personal data and productivity app that now has over 45 million users, is today announcing it has raised another $85 million, with 75% of that, $63.75 million, in the form of a secondary investment. We have heard that the raise was looking to be done on a $2 billion valuation.

This round of financing, which brings the total raised by Evernote to $251 million, bring two new investors to the company. AGC Equity Partners, via its majority-owned, mobile-focused affiliate m8 Capital, is leading the round; and Valiant Capital, which also invests in Dropbox, is participating, along with existing investors T. Rowe Price.

In a blog post announcing the news, Phil Libin writes that this round wasn’t raised because it needed cash. ”It’s nice to have this extra peace of mind, even if we don’t strictly need it.” (That was also the case only seven months ago in May, when Evernote raised $70 million, on a $1 billion valuation.)

Rather, it is ”to decouple liquidity from exit” and to focus less on “external market conditions” — that is, to reduce any pressure for an exit from existing shareholders, by reducing their stake in the company, and bringing in others who perhaps have a different approach.

“This gives some liquidity to shareholders and and rotates out shorter-term horizon investors for longer term horizon investors,” Libin told me in an interview earlier today. It’s about adding more investors who will stay with the company even after it eventually goes public.

In the blog post he describes it like this: “By giving early shareholders the opportunity to sell some of their holdings, we reduce the pressure to exit while at the same time forging relationships with important new long-term investors who can help shepherd the company to, through, and beyond an eventual IPO,” he writes. But don’t hold your breath for that IPO to come soon. Today he told me it would be “a few years” away still, possibly three.

The money will be used to continue to build more products that will attract more users, and hopefully convince a growing proportion of them to pay for extras. Evernote has been running an enterprise-focused beta of Evernote Business, but it also has moved into apps to manage your contacts, record what you’ve eaten, pictures, and more.

Libin also told me today that “it’s good to have some money put away” for acquisitions, which we should expect to see in 2013. As for what that might be, he said Evernote didn’t plan too much in that way — it just means you end “vastly overpaying” for something to fit into a rigid roadmap, he said. Instead, they take an organic approach. The products that Evernote people love to use themselves are the ones they would like to buy.

Libin is well-known for his desire to build Evernote as a that a startup that will last for the next 100 years. He is  bullish on Evernote’s particular business model: as a consumer app, it wants to create the sense of a secure place for your information for the rest of your life and beyond. To that end, Evernote eschews advertising and any kind of commercial big-data play, and believes that revenue will come from people paying for extra, premium services on top of a compelling free service. “We think you will want to pay for the things you like,” Libin told me earlier this year. Today he noted that as Evernote has continued to grow, the proportion of paid users has remained steady and just as they had projected it would.

As for the investment details, Libin tells TechCrunch that a number of investors sold small percentages of their stakes, but no one has cashed out completely. Past investors include DoCoMo Capital, Morganthaler Ventures, Sequoia Capital, Meritech Capital Partners, CBC Capital, Harbor Pacific Capital and Allen & Company, along with angel investors.

This is not the first secondary sale in Evernote. Troika Ventures, the venture division of Troika Dialog, sold its stake in Evernote in February of this year to Sequoia, for what is thought to have been a 10X return on investment. At the time, Evernote had 20 million users, compared to over 40 million today.

It’s not clear how much that growth would have impacted the company’s valuation — which, considering the current pressures we are seeing for startups to raise cash, may have ended up lower than the $2 billion we heard was being shopped around.

While Russian Troika was one of Evernote’s earliest international investors — later ones include China’s CBC Capital and the Asia Pacific-focused Harbor Pacific Capital — this latest round brings more to the table. AGC is Kuwaiti-backed and both AGC and m8 are both headquartered in London. Joe Kim, who led the investment for AGC/m8, is a partner at both.

International is an important market for Evernote. Already it accounts for about 70% of its customer base and Libin, who himself was born in St Petersburg, says it wil be a “big focus” in our 100-year plan.

Evernote has slowly been building up its international products to meet demand. Just earlier today, it got integrated into the Tecent One Browser for users in English, Thai and Indonesian languages to clip and save webpages into their Evernote accounts. It was already integrated into the browser in India.

If you must have a gigantic smartphone, the Note II is a solid performer. But the problems of the first-generation Note — unwieldy size, messy software, gimmicky stylus — still haunt the sequel.

When it comes to standalone audio components, Digital-to-Analog converters are enjoying a renaissance. Regardless of their size, shape, or design, few DACs will do more for your music than this one.

Which is better: a mammoth TV with a mediocre picture, or a smaller TV with a great picture? If you’re in the camp that believes size trumps all, Vizio has just the LCD.

For its stab at a Windows 8 hybrid, Toshiba is siding with sliding. But it falls short on value, battery life and general usability.

While the 1080p screen on HTC’s new handset is mighty pretty, it doesn’t turn the mostly decent phone into a must-have device.

In 1996, people in the U.S. bought about 2.3 albums per year. Today, thanks to services like Spotify and Rdio, some of us listen to that many albums a day. Last-minute concert ticket app WillCall wants to make live music just as accessible. This week it released version 1.5 of its iOS app, which focuses on delivering push notifications to your feeds about what shows your friends are going to.

WillCall picks the best concerts in town, strikes deals with the promoters, and sells tickets through its app in the few days leading up to the show. You can open the app to check out available gigs or wait for push notifications about newly added concerts or alerts about which shows friends are buying tickets to. The mobile-only commerce experience is super-lightweight, and you can trust it to only send you to see bands and DJs that are actually great on stage. You can see how it works in the video below.

Here’s why this model has big potential.

With recorded music, the barrier to wider consumption was price. It cost $16 for an album you had probably only heard one song from. It sucked when you popped it into the CD player and the rest were crap. That meant you only plopped down cash when you were almost positive you’d like it.

With live music, price is a barrier, but possibly even bigger hurdles are discovery and scheduling. Face it. A night of drinks at a bar could easily cost as much as a concert ticket. Let me tell you, take a few sips of whiskey in the parking lot before you go to a great show and you’ll have a lot better time at the same price as wasting away in some dive.

But WillCall’s real value-add is solving the other two problems. Founder Donnie Dinch tells me “The average person goes to 1.5 shows every year but we’re obliterating that number.” Low attendance is partly because people don’t know who’s in town. Even with apps like Songkick, monitoring for nearby gigs from your favorite artists and buying tickets before they sell out is a pain. WillCall takes care of all this. Its editorial team only picks reputable bands and only tells you about shows with available tickets (or the app clearly displays if they’ve just sold out).

Now that we have so many real-time communication tools like SMS, Facebook, and Twitter, there’s less need to plan things far in advance. In fact, it can be worrisome to buy concert tickets for four months from now with little idea if your best buddy’s birthday party will be somewhere else that night, or if you’ll be out of town. WillCall sells the tickets the week of the show, right up until it starts, so you’re sure you can actually attend and won’t have to end up messing around to sell them on Craigslist.

Push notifications from friends assure you won’t be alone at the venue. Dinch says “purchase notifications are what drive the most purchases without a doubt.”

The new WillCall 1.5 updates make both these things even easier. Video previews that show an artist’s best YouTube clip gives you a feel for the musicians it’s selling tickets to see. The new Friend Activity feed meanwhile aggregates all the RSVPs of your chums so you know who to have meet you in the parking lot to get at that whiskey. You can also share your purchases to Twitter in addition to Facebook to recruit more people for your whiskey drinking session night at the club.

When done right, mobilel commerce is awesome. No shopping, and the transactions go down in the background. What you want gets brought right to you, and the purchase only takes a single tap. That’s why I hear investors saying the early winners of mobile commerce could become institutionalized brands for years to come. And it’s why SV Angel and 500 Startups backed WillCall’s seed round.

WillCall has apps for iOS and Android, but is only in San Francisco now. It plans to launch in New York and Los Angeles early next year. For now, Bay Area folks can try it out as WillCall is running its own pop-up show with drum machine wizard AraabMUZIK tonight in SF.

[This is a pretty accurate representation of WillCall. The main omission is just that it doesn’t have shows for sale every night.]

Financial software giant Intuit offers a Square-competitor, GoPayment, which allows users in the U.S. and Canada to accept payments via a reader that attaches to any smartphone. Today, Intuit is expanding across the pond with the launch of a mobile card reader in the UK; however, the offering has a different name – Intuit Pay.

Intuit Pay is essentially GoPayment but tailored for the UK market and payments network. Via a chip and PIN card reader that attaches to a smartphone and a dedicated mobile app, Intuit Pay allows users to accept credit cards for payments. Additionally, the package comes with the ability to process card payments online.

The company cautions that this is just a pilot, and the service will roll out more broadly to UK users soon.

As for why the UK version of the service has a different name, the company says that it encountered legal issues when naming the UK version GoPayment. Intuit says the service works with chip and pin payments from MasterCard, Visa and Mastro cards, and that all data is encrypted. And Intuit Pay meets the unique requirements of the U.K. payments industry.

The company most recently merged GoPayment with its traditional POS software, QuickBooks, allowing the two products to communicate with each other, syncing both inventory and financial data from PC to mobile or vice versa. The ability to sync between financial services products and payments services is one of the advantages of using GoPayment/Intuit Pay, says Intuit.

Intuit’s Chris Hylen explains that in the next evolution of GoPayment, we’ll probably see the addition of web payments, similar to Intuit Pay. He adds that the company plans to localize the offering for other international markets.

For mobile payments offerings like PayPal Here, Square, GoPayments and others, international represents a huge growth potential. Square just launched in Canada and PayPal Here is available in Japan, Hong Kong, Australia and Canada. Launching abroad can be complicated because of security and regulatory environments, as well as incorporating additional payments systems, like chip readers. And it’s unclear yet whether the first service to launch in an international market ends up being the most popular mobile payments gateway for businesses.

Groupon shares (NASDAQ:GRPN) closed at 4.42, 11.62 percent above yesterday’s level. CEO Andrew Mason’s interview was highly anticipated today. Yesterday, AllThingsD reported that the board questioned Mason’s vision.

Mason didn’t try to deny or pretend that nothing happened. Instead, he was very candid, going so far as to say that he would fire himself if he thought he wasn’t the right man for the job. He didn’t try to hide that investors currently have doubts.

Groupon has had a tumultuous year, with shares falling from a 25.84 high point on February 8. At 4.42, it represents an incredible 82.9 percent downturn. Mason even said that with such a decrease, board members have to question his legitimacy. Otherwise they wouldn’t be doing their jobs properly.

After defending his position, Mason outlined why he believed in Groupon. It was all about the company’s future, with goods deals and international markets as the two key elements of Groupon’s success.

Yet, an 11.62 percent increase represents a small market capitalization gain when shares are trading at such a low level. Groupon’s market cap is $2.9 billion tonight. Mason said that shares won’t trade above 20 any time soon.

Another crowd funding startup has entered the mix, and is announcing funding today (which was raised via its own platform, of course). Crowd investing startup Wefunder is announcing a $530,000 seed round from just under 60 investors, over half of whom are unaccredited. Nihal Mehta, Jim Pallotta, Dharmesh Shah, and Bill Warner also participated in the round.

Similar to other crowdfunding sites like Kickstarter, Wefunder aims to help unaccredited investors put money into startups and ideas they are interested in. Founded by MIT Sloan and Techstars alumni Mike Norman, Nick Tomarrello and Greg Belote; Wefunded actually helped craft the Crowdfunding portion of the JOBS Act that President Obama signed into law on April 5th, and watched him do so in person at the White House. The JOBS act opened up equity crowdfunding’s limitations, and expanded the ability for unaccredited investors to put money into startups with limited regulation from the SEC.

The company’s founders acknowledge that the crowdfunding space is ‘crowded;’ but where Wefunder hopes to differ from competitors is in the actual follow through from an investment. Wefunder actually encourages investors to build relationships with entrepreneurs, and help startups beyond the funding moment. Investors are required to help with product feedback, connections, and evangelism. As Norman explains, the site really wants to place the emphasis on building long term relationships between founders and investors.

To celebrate the implementation of a part of the JOBS Act called general solicitation, which allows startups to publicly advertise the opportunity to invest in their company through social media or news publications, Wefunder is also launching a Startup of The Month program.

Entrepreneurs that apply to the program will go through an initial selection process after which a panel of angels including Brad Feld, Nihal Mehta, Bill Warner and others will interview 5 different startups about their businesses in a Google hangout. The winner is guaranteed a $25,000 investment and hands on help from Wefunder designing a public launch.

Norman Winarsky, vice president of SRI Ventures, offered his thoughts today on how Apple has handled the acquisition and subsequent relaunch of Siri, an integrated service in iOS. He was diplomatic about some of the criticism Siri has received, while also acknowledging the service has some real shortcomings.

For those of you not familiar with Siri’s history, the startup actually spun out of SRI, it was based on technology developed there, and Winarsky was on Siri’s board of directors. So when Winarsky answered questions from reporters this afternoon at Bloomberg’s San Francisco office, it was inevitable that someone would ask about what Apple has done with the technology.

Earlier in the conversation, Winarsky had argued that virtual personal assistant services should be focused on specific verticals. If you make these products too broad, then the answers they provide aren’t going to be very good. Siri, he said, was initially designed for travel and entertainment, and SRI has developed other assistant products, including Lola for banking and Desti for travel.

However, when Apple launched its version of Siri, it became a broad cultural phenomenon, with appearances on Big Bang Theory with people asking it all kinds of strange questions. The phenomenon was “quite wonderful, in a way,” Winarsky said, but it also “stretched Siri beyond its initial capabilities.” He added that he’s not privy to the details of how Apple has developed the app, but still, “When you start asking, ‘Siri, do you love me?’ that’s not travel and entertainment.”

Winarsky was also quick to say that none of these problems are Apple’s fault.

“In general, I think Apple did an absolutely superb job,” he said. “I think they have problems that would have occurred anyhow. They have all the resources in the world to solve those problems. These are not unsolvable problems.”

Microsoft might be figuring out that the best way to get users to use its product isn’t by charging an arm and a leg for updates and releasing them only once every few years. Redmond is reportedly switching to an approach like that taken by rival Apple, delivering inexpensive, annual updates that are less dramatic but which are designed to get all users on board a unified platform.

Apple follows a similar pattern with OS X, one which began taking shape with Snow Leopard, with lower upgrade costs for it and subsequent versions, and culminating with the release of Mountain Lion this year, just one year after the introduction of Lion in 2011. For Apple, it’s a model that makes sense; the company has never been very stringent about anti-piracy measures for its desktop OS, even when it used to cost considerably more money. That’s because Apple makes money on hardware, and that’s its primary focus. Software is a tool it can use to drive more hardware sales, not its central focus.

For Microsoft, shifting to a model where, if The Verge’s sources are correct, updates to future versions of Windows after it institutes this strategy will be cheap or even free, the ramifications are very different. The program begins with a version called Windows Blue, according to the report, which echoes an earlier one by ZDNet. Windows Blue will arrive in the middle of next year some time, and will bring modifications to the user interface, along with deeper platform changes and the aforementioned drastic shift in pricing.

What’s changed? Well, Microsoft has been changing its business in a number of ways recently. First, Windows 8 actually ships with ads included. Second, there’s much more focus on the Windows marketplace as a distribution method. And finally, Redmond is making its own computer hardware again, and selling that hardware directly to consumers, which is a marked departure from its sole dependence on OEM PC-maker partners. A changed Microsoft means that it can pursue a different plan for building and shipping software.

And while it’s easy to see this as Microsoft following a trick that has worked for Apple in the past, it’s more about evolving desktop software to mimic mobile platform iteration cycles. Consumers are doing more and more of their computing on mobile devices, and a mobile OS updates more frequently than we’ve traditionally seen on the desktop, with punctuated bursts of feature additions and plenty of maintenance updates.

If Microsoft is serious about unifying its platform experiences across various types of devices, including the Xbox, Windows PCs, tablets and smartphones, than this type of upgrade path and aggressive pricing makes plenty of sense.

TiVo announced reported solid third-quarter financials, thanks to subscription growth from pay TV partners and the first payments in litigation it settled with Verizon earlier this year. It reported service and technology revenues of $61 million, which was up 18 percent from a year ago. It also reported net income of $59 million, which was bolstered by $78.4 million from litigation proceeds due to the Verizon settlement.

A few years ago, TiVo looked like it was on the brink of dying. As pay TV operators began offering their own leased DVRs, consumer interest in TiVo’s hardware waned. With the DVR becoming a commodity, TiVo was losing hundreds of thousands of subscribers a quarter, as old users left and the company failed to attract new subscribers to replace them.

Things are looking up over recent quarters, though, as TiVo has struck deals with pay TV operators — the same group that almost rendered its hardware irrelevant — to license its hardware and software to their subscribers. The result has been a massive turnaround in subscribers and revenue it’s generating. MSO-related revenues, for instance, are up 84 percent year-over-year thanks to those deals.

The company has also succeeded in patent litigation, most recently against Verizon, which agreed to pay TiVo more than $250 million to settle a long-running lawsuit against it. That brings total winnings from patent litigation to more than $1 billion over recent years.

The combination of those two factors — cable deals and patent wins — has breathed new life into the DVR tech innovator. TiVo is no longer on a slow and steady race to zero, but actually growing subscribers at a faster and faster clip as time goes on. In the third quarter, its subscriber additions grew 44 percent year-over-year, compared to 41 percent in the second quarter and 27 percent in the first quarter.

TiVo hit its lowest point on the subscriber mark about five or six quarters ago, as its user base declined to 1.9 million. Now, it’s got nearly 3 million subscribers at the end of the third quarter, thanks to huge growth in its pay TV business. It’s now adding upwards of 250,000 subscribers a quarter thanks to its MSO deals, and that number could increase even further as it brings more on board. In the quarter it brought on new U.S. partners Mediacom, Midcontinent, and Cable ONE to expand its partner footprint. That comes on top of Virgin Media in the U.K., ONO in Spain, and Com Hem in Scandinavia.