Booting Up: One BILLION Users

(Photo: The Social Network)

Accel has closed a $475 million fund that they plan to use for Series A startups mainly in Israel and Europe. [TechCrunch]

Yesterday was Twitter’s 7th birthday and it celebrated by hitting the 200 million users milestone. That’s great and all but… [The Verge]

…YouTube announced they have one billion monthly users. You know what’s cool? [San Jose Mercury News]

The influx of new money from this round of billion dollar startups has undeniably changed the Valley. But is it for the better? [East Bay Express]

Turns out Starbucks baristas actually have no idea how to use that Square thing. [Fast Company]

Oh You Fancy Huh?

Lot18 Closes Hefty Series C; $30 Million for the Club of Fancy Things

Members only.

Lot18, the New York-based, members-only deal site for oenophiles and foodies, announced a $30 million round of funding this morning, about double what was raised in its seed, A, B and B-angel rounds. Accel Partners lead the round, which included existing investors New Enterprise Associates and FirstMark Capital. “The funds will support continued growth, as well as further technological and product development, particularly the expansion of Lot18 Gourmet and Experiences, the company’s food and travel verticals, respectively,” according to a news release. Read More

The Third Degree

David Liu on Knewton’s $33 M. Round From Founder’s Fund: ‘We’re Taking All the Dirty Work Out of Teaching’

Mr. Liu

Yesterday Knewton, the Union Square-based online education startup, announced a $33 million Series D round led by Founder’s Fund, the VC firm co-founded by Peter Thiel. That might explain why Betabeat heard Mr. Thiel’s fellow co-founders Ken Howery and Luke Nosek were throwing a pre-game party Friday night in New York.

Existing investors Accel, Bessemer and FirstMark also participated in the round, along with Pearson, an education publisher, putting Knewton’s valuation higher than $150 million, according to TechCrunch. Another New York City-based education startup, 2Tor (get it??), raised $32.5 million earlier this year. But what sets Knewton apart is the adaptive learning algorithm the company developed, which figures out student’s weakness and can be applied to any type of curriculum.

Indeed, after trying its platform out in test prep, Knewton is now being used by all 10,000 incoming freshman at Arizona State for an online math readiness course.

Betabeat talked to COO David Liu about why Knewton isn’t making teachers obsolete, how its adaptive learning algorithm works, why Mr. Thiel would invest in an education startup and why Mr. Liu thinks Knewton is, basically, going to take over the world of personalized education. Read More

Summer Jamz

Fred Wilson, Kleiner Perkins and Accel All Want

Always down to rock a microphone

Yesterday Betabeat broke the news that was being courted by investors for a new round of $5-10 million at a $40 million valuation.

Business Insider’s Alyson Shontell published an “exclusive” later in the day reporting that Turntable had raised exactly $7.5 million at a $37.5 million valuation and that the final investor, beyond the returning group from Stickybits, was set.

That was not what we were hearing from our contacts at Turntable, which is why we wrote the funding was still in flux. This afternoon founder Seth Goldstein wrote Betabeat to confirm that they have not closed a new funding round.  Read More

Venture Capitalism

Venture Capital Class Warfare: ‘The Rich Are Getting Richer’

Marc Andreessen (via Joi)

The current wave of IPOs that investors hope will extend from LinkedIn through Groupon and onto Facebook is making some venture capitalists very, very wealthy. But the bonkers bubble money isn’t exactly getting spread around. Bloomberg reports that the success of firms like Sequoia, Greylock, Accel, and Andreessen Horowitz, all of whom have equity in the most valuable start-ups, is driving a massive wedge between “the venture-capital industry’s haves and have-nots.” Read More

Silicon Alley

Accel Parties in NYC, Teases New Office Atop Google


The sale of to Amazon for $540 million was a grand slam in the venture capital world. So it was fitting that Accel’s Sameer Ghandi presented founders Marc Lore and Vinit Bharara with autographed Yankees jerseys.

“These guys started their first online business in 1999, not exactly the best timing,” Ghandi said last night at Read More