Causeway Media Partners
StrictlyVC: July 1, 2014
Happy first day of July, everyone!
A quick reminder, as if you need it: the U.S. squares off against Belgium at 1 p.m. PST today.
Mike Gupta is no longer Twitter's CFO, tweets L.A Times reporter Chris O'Brien. Gupta is now the company's senior vice president of strategic investments. Meanwhile, Anthony Noto, the high-profile Goldman Sachs banker who helped take Twitter public last November and left the bank in May to join the hedge fund Coatue Management, is now Twitter's CFO. "Welcome to the daily dose of soap opera that is the San Francisco social communications company," writes Recode's Kara Swisher of the switcheroo.
Causeway Media Partners, an Investment Firm By and For Sports Nuts
Causeway Media Partners, a Boston-based growth equity firm, has been flying under the radar since its inception in the spring of last year. That's partly because its founders don't need to draw attention to themselves. Wyc Grousbeck, a former general partner at Highland Capital Partners, is now an owner and the CEO of the Boston Celtics. Mark Wan, who cofounded the healthcare-focused firm Three Arch Partners, is an owner in the Celtics and the NFL's San Francisco 49ers. Meanwhile, Bob Higgins cofounded Highland Capital Partners, where he worked with Grousbeck and invested alongside Wan.
Higgins, who still sits on the boards of four Highland portfolio companies, says there is also an experimental element to the whole endeavor. In fact, Causeway was never something he expected to jump into when he began transitioning out of Highland in 2012. As he tells it, he, Wan, and Grousbeck sat down last year for a friendly chat, and wound up in business together.
"We starting talking about what's going on in sports media, and the more we talked, including with [sports team owners], the more [interest it generated]. And before we knew it, we'd raised a fund without even really trying," he says, laughing.
Today, Causeway has a clear mission, to find media- and tech-related investment opportunities that can benefit from the friends' network of NBA and NFL team owners, media executives and professional investors. And it's investing $125 million — including a "good chunk of our own money," says Higgins — to "see if the space is as attractive as we thought."
They've already placed three bets. Last year, they invested $21 million in Formula E Holdings, series promoters of Formula E, the world's first fully-electric racing series. In April, they spent $5 million for a non-controlling stake of up to 50 percent in the four-year-old Street League skateboarding circuit, which brings together professional skateboarders in competitions. And just last week, Causeway closed its third investment in Sport Ngin, a company that helps sports organizations build websites and mobile applications. (Causeway co-led the company's $25 million Series D round.)
Higgins says Causeway's ability to make warm introductions is among the biggest benefits to its portfolio companies. "If you're a biotech investor, you need to know all the pharmaceutical people, because they're your potential partners and acquirers. Similarly, we're spending a lot of time with media companies, team owners, and people with sponsorship dollars so we can make connections that are critical to our companies."
Going forward, the idea is plug between $5 million and $25 million into a handful of other portfolio companies – deals that will likely find their way to Causeway through a variety of sources, including some of Causeway's LPs, which include the general partners of 11 other investment firms, along with sports owners. Higgins say the firm is also receiving calls from "people in the entertainment industry that know of things that are potentially interesting as acquisitions for them, but aren't quite at that stage yet," says Higgins.
There's certainly no shortage of potential opportunities, says Higgins, who sounds a bit taken aback by the amount of deal flow the partners are now seeing.
"We're looking at 100 things for every one [investment] we make. And inquiries are in the thousands."
AdEspresso, a 2.5-year-old, Milan, Italy and San Francisco-based company whose SaaS platform helps its customers manage and optimize their Facebook Ads, has raised $1.3 million in seed funding from new investors SierraMaya Ventures and VegasTech Fund. Earlier investor 500 Startups and other angels, via AngelList, also participated in the round.
Artbinder, a 2.5-year-old, New York-based company whose mobile application allows users to present artworks remotely to streamline the sales and presentation experience, has raised $3.17 million in Series A funding led by Index Ventures. Numerous individual investors also joined the round, including former Etsy COO Adam Freed. The WSJ has much more here.
Automated Insights, a seven-year-old, Durham, N.C.-based company whose real-time content automation services transform data into narratives, visualizations and applications, has raised $5.5 million in Series B funding led by Osage Venture Partners. Other investors in the round included Court Square Ventures, OCA Ventures, IDEA Fund Partners, Samsung Venture Investment, SevOne, and entrepreneur-investor Steve Case. (The company, which has now raised $10.8 million altogether, also announced a deal yesterday to provide the Associated Press with thousands of corporate earnings reports each quarter.)
Cidara Therapeutics, a new, San Diego-based drug developer that's trying to eradicate the types of fungal infections that often complicate cancer and transplant treatments, has raised $32 million in Series A funding from 5AM Ventures, Aisling Capital, Frazier Healthcare Ventures, and InterWest Partners.
Databricks, a 1.5-year-old, San Francisco-based company that builds software centered around Apache Spark, the open-source software project, has raised $33 million in Series B funding led by New Enterprise Associates. Earlier investor Andreessen Horowitz also joined the round, which brings the company's funding to $47 million. The WSJ has much more here.
Drybar, a five-year-old, L.A.-based blow-dry-only salon concept, has raised $20 million in funding led by SPK Capital and earlier investor Castanea Partners. Individual investors, including Janet Gurwitch, the founder and former CEO of Laura Mercier Cosmetics, filled out the round. The company has raised $38 million altogether, shows Crunchbase.
Emerald Therapeutics, a four-year-old, Menlo Park, Ca.-based company that's developing potential treatments for viral infections like HIV and HPV, has raised $13.5 million over two funding rounds (the earlier of which wasn't made public) from Founders Fund, PayPal cofounder Max Levchin and Schooner Capital. Recode has much more on the company here.
Hexadite, a five-month-old, Israel-based cyber security startup launched by three former Israeli intelligence officials, has raised $2.5 million in seed funding from YL Ventures, with participation from Moshe Lichtman, a general partner at Israeli venture capital firm Israel Growth Partners. Techcrunch has a bit more here about the company's technology.
Moi Corp., a two-year-old, Tokyo-based company whose service allows users to live stream video on Twitter or Facebook , has raised $5 million in Series A funding, including from East Ventures and Sinar Mas Indonesia.
Percentil, a two-year-old, Madrid, Spain-based online marketplace for secondhand children's products, has raised $1.4 million in seed funding from the European invest Active Venture Partners. The company has now raised $2.4 million altogether.
Tapad, a four-year-old, New York-based ad retargeting firm, has raised $7 million Series B-2 financing led by earlier investor FirstMark Capital, which was joined by both new investors Battery Ventures and G&H Partners, as well as earlier investors Avalon Ventures and the publicly traded Firsthand Technology Value Fund. The company has raised $15.3 million to date, shows Crunchbase.
Ambrx, an 11-year-old, La Jolla, Ca.-based company that develops protein therapeutics called bio-conjugates, has withdrawn its registration to go public, citing market conditions. Ambryx has raised at least $10 million, shows Crunchbase; its backers include Tavistock Life Sciences, Maverick Capital, Versant Ventures, Aravis Ventures, CMEA Capital, Merck Serono Ventures, and 5AM Ventures.
Loxo Oncology, a year-old, Stamford Ct.-based company that develops targeted small molecule therapeutics to treat cancer in genetically defined patient populations, has filed to go public. The company has raised $57 million from investors, including Aisling Capital, which owns 29 percent; OrbiMed, which owns18.1 percent; Array BioPharma, which owns 15.3 percent , AI Loxo Holdings, which owns 13 percent, and New Enterprise Associates, which owns 14.9.
Yodlee, a 15-year-old, Redwood Shores, Ca.-based online banking and finance service that works with nine of the biggest banks in the U.S., hasfiled for an IPO. The company is majority owned by Warburg Pincus, which has a 37.18 percent stake in the business; Bank of America Corporation, which owns 12.71 percent; S1 Corporation which owns 12.63 percent; and Accel Partners, which owns 9.25 percent.
Cliptamatic, a two-year-old, New York City-based video management system that helped content owners syndicate short clips, has been acquired by NowThis News, a nearly two-year-old startup that makes short-form videos for mobile devices and social platforms. Terms of the deal weren't disclosed, but Techcrunch reports that Cliptamatic had raised $2 million from investors. NowThis News has raised $9.6 million altogether, including Lerer Hippeau Ventures (which incubated the company), Oak Investment Partners, Bedrocket Media Ventures, and SoftBank Capital.
Grow Mobile, a two-year-old, San Francisco-based company whose mobile advertising platform helps developers buy, track, optimize and scale user acquisition campaigns, has been acquired by the publicly traded, Tel Aviv, Israel-based sofware company Perion Network for $17 million in cash and stock. Grow Mobile had raised just $1 million in seed funding from Bessemer Venture Partners and Signia Venture Partners, according to Crunchbase.
The assets of Small Bones Innovations, a five-year-old, Morrisville, Pa.-based company that makes devices for small bones and joints, particularly focusing on trauma and arthroplasty, are being acquired by the Fortune 500 medical technologies company Stryker Corp. for up to $375 million in cash. Small Bones Innovations had raised at least $244 million, shows Crunchbase. Its investors include 3i Group, NGN Capital, Trevi Health Ventures, Malaysian Life Sciences Capital Fund, Goldman Sachs, Viscogliosi Brothers, Khazanah Nasional Berhad and Axiom Ventures.
Sourcebits, an eight-year-old, San Francisco-based mobile application development company, has been acquired by the Greek enterprise mobility products developer Globo for undisclosed terms. In a press release, Globo's CEO said the "acquisition reinforces our commitment to U.S. market." Globo trades publicly on the London Stock Exchange. Sourcebits had raised at least $10 million from investors, including Sequoia Capital and IDG Ventures India.
TapCommerce, a two-year-old, New York-based mobile ad tech firm, has been acquired by Twitter for an undisclosed amount that Re/code sources place in the ballpark of $100 million. The company had raised $11.7 million from investors, including RRE Ventures, Metamorphic Ventures, Eniac Ventures, Nextview Ventures, Bain Capital Ventures and Pereg Ventures.
TastemakerX, a 2.5-year-old, San Francisco-based company whose technology enabled users to create and share their music playlists in social networks, has been acquired by the digital music service Rdio for undisclosed terms. TastemakerX had raised $3.1 million from investors, including Alara Capital, AOL Ventures, Tekton Ventures, True Ventures, Baseline Ventures, and Guggenheim Partners. Rdio, a six-year-old, San Francisco-based startup, has raised $17.5 million from investors, including Atomico, Mangrove Capital Partners, and Skype cofounder Janus Friis.
A list of "all the techies playing in Sun Valley next week."
A former executive at startup Tinder has sued the popular dating app and its parent IAC/InterActiveCorp, claiming Tinder operates in a "frat-like" atmosphere and that she was harassed and discriminated against before being forced out.
The attorneys at Cooley have just launched a neat new resource for entrepreneurs that features free legal and business content covering formation, financing, building a team, working with directors and advisors, intellectual property, M&A, IPOs and other stuff.
It's already widely believed that Jeff Bezos strikes fear in the hearts of his employees at Amazon. Now, a new documentary about him seems to confirm those suspicions. Says Stanford grad David Selinger (who went on to cofound Redfin among other companies): "I felt somewhat intellectually intimidated by [Bezos] to be honest with you. He was just so smart, and so driven and so confident in himself that sometimes it just felt like I was getting squished out of the room." Selinger recalls, for example, proposing to sell advertisements on the home page of Amazon. Bezos responded that it was one of the stupidest ideas Selinger ever had. "I think he was being subtle," says Selinger. GeekWire has the story here.
Venture capitalist Tim Chang, a managing director at Mayfield Fund, has an admirer at Buzzfeed. More here if you missed her doting tribute. (In response to the "being made fun of non-stop" since the article was published, Chang decided to offer some nutrition and diet tips to those wondering how manages to look so fit.)
David Hahn, a longtime VP of product management at LinkedIn, has joined Greylock Partners as an entrepreneur-in-residence; Hahn will be advising the firm's portfolio companies on product and monetization strategies, says Greylock, whose ties to LinkedIn grow closer all the time. LinkedIn cofounder Reid Hoffman joined the firm in 2009; another Greylock partner, Josh Elman, spent a year-and-a-half at LinkedIn as a senior product manager earlier in his career.
Comcast is looking for a high-level managing director to be the company's primary business development contact in Silicon Valley and the West Coast.
A new Rock Health report says that halfway through 2014, more than $2.2 billion has been invested in digital health startups — more than the $1.97 billion invested during all of 2013 (which itself attracted record funding). VentureBeat has more here.
The NVCA is reporting this morning that 28 venture-backed IPOs raised $4.9 billion during the second quarter of 2014, a 45 percent increase, by dollars raised, from the previous quarter. The second quarter also marked the fifth consecutive quarter to see 20 or more venture-backed IPOs.
No product? No problem. How the startup Telepathy hyped its way into South by Southwest, a CNN appearance, and $5 million in venture capital despite its "sparsely functional prototype".
"Automakers are not sure if Google is their friend or their enemy, but they have a sneaking suspicion that whatever Google's going to do is going to cause upheaval in the industry."
Wired, on why Apple's Siri will soon understand you a whole lot better.
"By a 5–4 vote on Monday, the United States Supreme Court settled a dispute that Justice Samuel Alito said was 'at its core about the rights of women versus the rights of people.'"
Mick Jagger on Monty Python's upcoming reunion gigs: "Are they still going? . . . I mean, the best one died years ago!"
A prayer for the sunburned.
Finally, a product for tough poets.
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Filed Under: Morning Summary Tagged With: Causeway Media Partners, StrictlyVC
Photo of Grousbeck, Wan, and Higgins high-fiving by Elise Mendola for Associated Press.
Filed Under: Investment Opportunities Tagged With: Bob Higgins, Causeway Media Partners, Highland Capital Partners, Mark Wan, Wyc Grousbeck