Fresh Capital

Dwolla Raises $16.5M from Andreessen Horowitz and Others, Will Be Expanding to San Francisco

Dwolla founder Ben Milne. (Photo: Twitter)

Dwolla*, the Des Moines-based payment platform that has a strong presence in NYC, announced today that it has received a $16.5 million Series C investment led by venture capital behemoth Andreessen Horowitz, with contributions from NYC firms Thrive Capital* and Union Square Ventures. The fresh funding will allow Dwolla to double its staff of 40 to 80 and open a third office in San Francisco, according to The Next Web. Andreessen partner Scott Weiss will be joining Dwolla’s board. Read More


Tech Insurgents 2012: Alex Taub and Michael Schonfeld

Mr. Taub and Mr. Schonfeld

The Credit Card Killers

With an ever-crowded financial tech market and companies like PayPal and Google Wallet elbowing for industry dominance, the race to kill the credit card is heating up. But among the standouts is Iowa-based mobile payment startup Dwolla, thanks to an innovative pricing structure and a growing New York presence helmed by Michael Schonfeld and Alex Taub. Dwolla has raised money from two New York venture capital firms, Union Square Ventures and Thrive Capital. (Josh Kushner, a Thrive principal, is also part-owner of Observer Media Group.)

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Social Networking

Weeks After Layoffs, Kohort User Asks ‘Has Kohort Died?’

Mr. Davis (Photo:

Kohort, a social network for groups, launched last month jam-packed with friends of founder and former venture capitalist Mark Peter Davis.

But less than a month after launch, Mr. Davis took to the company’s blog to announce that they have decided to “decided to run Kohort with a smaller team, a leaner approach.”

AllThingsD‘s Peter Kafka expects the company to lay off almost all of its 15 employees. Dwolla founder Ben Milne announced yesterday via Twitter that Kohort builder Shane Reisner has already started working at Dwolla. Read More

Teach Me How to Startup

Was Ashton Kutcher High Being Really Dumb During This Interview About Dwolla?

Mr. Kutcher, right, explaining "cusps." Ben Milne, founder of Dwolla, left, possibly mortified.

UPDATE, April 11, 4:02 p.m.: Numerous readers, including Ashton Kutcher’s publicist, objected to the suggestion that Mr. Kutcher was high during his interview with Dwolla. In truth, Mr. Kutcher appears sober in the interview; the word “high” was used to imply that his answers did not make sense—but this appeared to be due to the overuse of jargon and simplicity of ideas, not the influence of mind-altering substances. We have updated the headline.

Iowa native Ashton Kutcher returned to the homeland today to officially announce an investment in Dwolla, one of the hottest investments of the moment, and appear with Dwolla founder Ben Milne for a special episode of Silicon Prairie News’s PrairieCast. The A-list actor has invested in A-list startups from Skype to Twitter to Airbnb to Path to Flipboard Gidsy to Zaarly to New York’s Foursquare, GroupMe and The Fancy. He’s reportedly invested in some 40 companies. He’s the Real Deal, we’re told, and not an opportunistic dabbler who only got into the whole startup thing because a long time ago he challenged CNN to a race to be the first Twitter account to hit a million followers.

“Ashton as an investor is brilliant,” Mr. Milne said today.

“I’ve come to realize he’s one of the most insightful investors I’ve worked with,” David Lee, who co-founded SV Angel, told the New York Times.

Mr. Kutcher actually has a lot of suggestions about product, other founders have told Betabeat in the past.

So we were curious to hear the actor riff on startups at length in the live question and answer session with SPN’s live studio audience. Like Paul Graham’s on stage office hours at TechCrunch Disrupt, it offered a rare peek into what meetings between a famous investor and his investments must be like.

We came away… underwhelmed. Read More

New Money

Dwolla Being Sued by Bitcoiners for $2 M.


The proprietors of a major Bitcoin exchange have filed a lawsuit in the Northern District of California alleging that racketeering, intentional misrepresentation, false advertising, breach of contract and other violations by payments startup Dwolla have cost them at least $2 million in damages, with the final amount to be decided by the court.

The plaintiff is TradeHill, a Bitcoin currency exchanger based in San Francisco and Chile that was at one time the second-largest processor of Bitcoin currency trades, but which recently shut down. The shutdown was largely due to losses sustained because of “chargebacks” or payments that cleared and then were rescinded by Dwolla, said TradeHill cofounder Jered Kenna, although other reasons were given at the time.

“We’ve been trying to resolve this for eight, nine months and they ignored all communication,” Pierre G. Basmaji, the Santa Monica-based attorney for TradeHill, told Betabeat by phone. “I have no idea why. I think… they don’t know how to handle it and were just hoping we would go away.”

Dwolla did not respond to requests for comment. UPDATE, 6:13 p.m.: Dwolla just released a statement. Read More

Million Dwolla Baby

Dwolla Announces Funding Led by Union Square Ventures

Mr. Milne.

Power to the prairie! That Union Square Ventures-led funding we reported on for investor darling Dwolla—the startup of the 700 name spreadsheet—is indeed happening. (Albeit for $5 million instead of the $10 million we expected.) Village Ventures, Thrive Capital, Marc Ecko of Artists & Instigators and angel investor Paige Craig participated.

Dwolla is doing a million dollars a day in transactions, CEO Ben Milne said in the announcement, and will use the money to build a payments network (a la Visa) that will use the power of the Internet to circumvent normal electronic payment processing fees. Read More

Million Dwolla Baby

Union Square Ventures Leading Series B in Iowa-Based Dwolla for About $10 M.

dwolla hoodie

Des Moines-based payments provider Dwolla, which enables seamless online payments for a quarter per transaction, has been a simmering hot new thing for a while. But recently the startup has had a flush of attention and VCs have been falling all over themselves to book flights to Iowa and get in on the company’s next round. Speaking of which, multiple sources have confirmed to Betabeat that Dwolla’s getting close to announcing a series B led by New York’s Union Square Ventures in the neighborhood of $10 million.

With its Shapeways investment, the startup’s Dutch founders move to New York and USV took out life insurance policies in case they got squished by taxis. But Dwolla leaving Des Moines—it’s only a three-hour flight, and VCs seem to be more than happy to make the schlep. Read More