Investors Drop Big Money On Dropbox So It Can Beat Box

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Dropbox is raising between $250 million and $400 million at a $10 billion valuation according to the Wall Street Journal and Re / code. Why? Because Dropbox has spent the last year rebuilding its product to make it work for businesses, and now it’s time to sell that product. How? Because a source says Dropbox has been doing well and felt it had the buzz behind it to take advantage of an easy fundraising market.

The money could also fund poaching top talent from other tech giants and big acquisitions. But with more competition than ever, Dropbox needs to do a big enterprises sales push before potential customers jump into bed with Box, Google Drive, Microsoft SkyDrive, or Amazon WorkSpaces.

Dropbox Grows Up

Dropbox built its name as a light-hearted consumer product. “Your files everywhere” was its motto, cutesy pencil drawings were its style, and its mascot? A Tyrannosaurus Rex wielding an AK-47…riding a shark…with a bald eagle on its back. The company even has a statue of the T-Rex in its San Francisco office’s foyer. Notice the lack of anything in this branding that would give businesses the assurance that Dropbox is secure, scalable, and great for complex teams.

Yet in terms of becoming a techie-household name, its viral strategy worked. Handing out gigabytes of free storage for signing up friends let it grow quickly. By November 2012 it had 100 million users. A year later, it had doubled in size to 200 million. Plus the fun-loving culture helped it poach big names like Google’s Guido Van Rossum – the father of Python, and veteran Facebook designers Soleio Cuervo and Rasmus Andersson.

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Medallia’s Amy Pressman On Extracting Value From Investors

Next StoryAsk A VC: Revolution Ventures’ David Golden’s Predictions For 2014FacebookTwitterLinkedInMedallia’s Amy Pressman And Sequoia’s Doug Leone On Investment

In this three-part series, we hosted Medallia, an enterprise company that offers customer experience management software, and Sequoia partner and board member Doug Leone in the studio. In this segment, co-founder and President Amy Pressman and Leone talked about how they work together at Medallia.

After staying bootstrapped for a number of years, Medallia raised $35 million last year from Sequoia Capital. Pressman went through a thorough vetting process of Leone and Sequoia, and wasn’t sure if she even wanted to raise money. But as she explains in the video, she wanted to expand her sales team, and Leone and Sequoia made the best partners to help her and her company accomplish this goal. Extracting value from this partnership beyond just a check was top of mind for Pressman.

As we explained in our first segment, Medallia essentially helps companies track how they are doing with customers on a day-to-day and even minute-by-minute basis. Further, Medallia allows companies to act on that feedback continuously (and track the outcomes). The company measures customer feedback through all channels (web-based, social phone, call center, SMS, social, mobile).

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Samsung Stock Closes Down 4.6%, Cutting $8B Off Its Market Value As Investors Worry

Samsung isn’t off to a great start for 2014 – during its first full day of trading of the new year, it lost 4.6 percent of its stock price value, which amounts to a more than $8 billion drop in market value, as reported by the Wall Street Journal. The drop is likely attributable to increasing lack of investor confidence in Samsung’s ability to continue to grow its mobile business.

Outlook for the company’s upcoming quarterly results are good – analysts estimate that they will see an increase in profit derived from their mobile business, which is the big powerhouse at the company when it comes to driving earnings. But that increase will be off the pace from the previous quarter, and the fear is that in general Samsung’s ability to continue to see increasing gains in its mobile business has come to an end.

The problem for Samsung comes from a number of developments in the mobile market over the past year. First, there’s the fact that smartphone penetration at the top-end of the market is now pretty wide-reaching, meaning there’s theoretically much less opportunity to sell high-end devices than there might have been previously.

There’s also ample price pressure making its way into the world of smartphone sales. Google’s Nexus devices continue to set examples for high quality hardware at lower, contract free prices, and now Motorola is also offering extreme value for money with the $179 Moto G, and the just-reduced Moto X at $399, a price drop made permanent earlier this week. To compete with Google and Google-owned Motorola on price, Samsung would inevitably find margins on its products lower than usual since budget devices becoming more important drives down mobile profit overall.

Samsung held a conference designed specifically to address the concerns of analysts and investors back in November last year, where it tried to reassure its backers and market watchers that it had the right plans in place to continue growth. However investors seem unconvinced. Its stock price was mostly flat coming out of that event, and both for the last day of 2013 and now the first day of 2014, price has dipped considerably.

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Silicon Valley Hustle: Former Motionloft CEO Accused Of Defrauding Investors

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Thanks to a series of high-profile exits and a generally frothy financing environment, it’s not unusual to see startup founders spending money lavishly these days. But the story of Motionloft and its founder Jon Mills could serve as a cautionary tale, especially for unsavvy investors drawn to a big payout.

On the surface, Mills seemed like a successful entrepreneur. His company, Motionloft, provided real-world analytics for store and property owners who needed to analyze pedestrian and vehicle traffic that passed by their respective establishments.

Mills was a first-time entrepreneur, but he had received backing from high-profile investors like Mark Cuban, and according to the Motionloft website, the company had secured clients like CVS, Saks Fifth Avenue, and Cushman & Wakefield.

Several former friends say Mills was also fun to be around and generous about inviting them to party with him at various music festivals and in places like Las Vegas.

All of which is why, when Mills started asking friends if they wanted to invest in his company, a few of them jumped at the opportunity.

They say Mills cashed checks that altogether were worth hundreds of thousands of dollars, promising them a small percentage of the company. Later, when he told them an acquisition was imminent, they felt confident they had made the right decision.

Mills is no longer part of Motionloft, and the validity of the investments his friends made while he was there is being called into question by earlier investors. As a result, after months of waiting, those friends now believe that not only was there no acquisition, but that it is possible they won’t get any of their money back.

We’ve spoken with Mills, and the former CEO admits to leaving the company in November. But he also says that all money he took as investment from friends was legitimate and used for company expenses, and he denies telling friends the company was going to be acquired.

New Investors

It all started in early 2013. Around the time of the Super Bowl, sources say Mills told some friends he had a couple of Motionloft “advisor points” he could use at will, enabling them to buy a small percentage of the company. For some, he also dangled the possibility of an acquisition that would make the investment pay off.

“He told me, ‘Mark Cuban said to pick two good friends who could afford

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Warby Parker Raises $60 Million From Existing Investors, Fortune Reports

Online eyeglasses company Warby Parker just raised a $60 million Series C round from its existing investors, with Tiger Global Management leading. General Catalyst Partners, Spark Capital, Thrive Capital and First Round Capital also reinvested. Fortune reported the news first.

It is likely that the company wasn’t short on cash before raising this round. But the momentum was right for the company as receiving new cash from existing investors is a great vote of confidence. Warby Parker plans to increase its customer support team. As Zappos showed everyone, having a great support team is an important asset when it comes to large-scale specialized e-commerce companies.

The startup first started as a way to get cheaper glasses. Instead of selling traditional brands, Warby Parker chose to go directly to the manufacturers in China and work with them. By removing the middleman and selling exclusively on its website, the startup became very competitive while maintaining healthy margins. Recently, the company put a toe in the water by opening a bricks-and-mortar store in New York. But the website remains the main retail location.

As a reminder, the company raised $41.5 million in January. Warby Parker now has enough cash to do small acquisitions. But it’s still unclear whether an IPO is in the works.

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