Betabeat » bettercloud

Flybridge’s David Aronoff Explains Why He Led a $5 M. Series A in NYC Enterprise Standout BetterCloud

Nitasha Tiku — Fri, 11 Jan 2013 10:00:56 -0400

In a recent blog post about the Series A crunch for consumer Internet startups, Fred Wilson wrote, "now that the momentum/late stage wants enterprise, we should expect the layers below to give them enterprise."

Flybridge Capital Partners, an early-stage VC firm with a focus on enterprise startups and companies that support infrastructure for consumer-facing startups (like 10Gen), is well positioned to capitalize on that trend. In September, the Boston-based firm opened an office in New York City, moving principal Matt Witheiler out to join the team. And today Flybridge leading a $5.05 million Series A round in BetterCloud, an enterprise startup that provides cloud management tools for Google Apps.

Since launching in the Google Apps Marketplace just six months ago, BetterCloud has picked up 15,000 business clients like The Financial Times, representing more than 5.5 million users.

Greycroft Partners and TriBeCa Venture Partners also participated in the round and Mr. Aronoff, the lead investor, will join BetterCloud's board of directors. Including the $2.2 million seed round BetterCloud raised in May 2012, that brings the company's funding to date to $7.25 million.

BetterCloud flagship product FlashPlanel is a platform that lets Google Apps administrators offer more controls, visibility, and automation. "Google is fairly quiet," about sharing stats on Google Apps adoption, Mr. Aronoff told Betabeat, "so you have to look at some proxies." Like for instance, the fast growth in BetterCloud's user base. "We did some digging in terms of our own research," he said, and announcements about corporate users moving to Gmail and other products were another indicator about the rise of Google Apps.

Despite concerns about the security and privacy, Mr. Aronoff said the reality is that, "The cloud is the inflection point and starting with consumers and moving into business, there’s this inexorable drive of moving off premise."

The other attractive aspect about BetterCloud's business model, he said, was its emphasis on community, partly through interacting on forums for Google Apps. "If you take a consumer-like approach, you can build a rabid very excited," user base that helps seed the way you think about your product. "For the next generation of enterprise software," he said, "The theme is care of the community.

As for that dreaded Series A crunch, Mr. Aronoff said Flybridge has "largely been insulated from it." The firm invests in its portfolio companies through the lifecycle of the startups. "We're still seeing healthy competition in seed deals as they progress and need Series A," he said, calling the BetterCloud round "competitive" as well.

Looking at the consumer side, however, "We’ve been waiting for [the Series A crunch] to come for awhile," he noted. "There’s just not enough venture capital firms to fund them. There’s always competition and market valuation for the best companies, but you're gonna see a bunch of potholes and I’m not sure thats really a bad thing." Companies that can't secure the funds can operate on a shoe string, merge with a competitor, or "go back to the drawing board."

Why I Chose to Build My Enterprise Startup in New York City

Mon, 05 Nov 2012 12:00:24 -0400

Mr. Politis

This is a guest post from David Politis, the founder and CEO of BetterCloud, the makers of FlashPanel, an admin tool for Google Apps that has acquired 10,000 customers and 3 million users since launching this July. You can follow him on Twitter @DavePolitis.

New York City has long been the promised land for investment bankers, hedge funders, media moguls and advertising agencies. More recently, it has become a center of innovation for technology startups. There is no shortage of launches and funding announcements for consumer-facing tech startups and service providers for digital advertisers.

However, exceptions side, one thing is certain: New York City is not known as a home for startups developing for enterprise.

Conventional wisdom has it that enterprise innovation takes place in the Bay Area, Seattle and other cities that have traditionally attracted enterprise venture capital investment and engineering talent. But faced with a number of options for where to build BetterCloud, the enterprise startup that I launched last year, I chose New York City. Here’s why:

Easier to Standout

For starters, the local venture capital climate is ripe for evaluating truly disruptive technologies that can demonstrate a path to monetization. To date, most observers would agree that a majority of seed, angel or Series A-funded NYC-based startups fit into two camps: consumer web or digital media. This has created a cluttered, hyper-competitive ecosystem of NYC startups, many making very similar claims about what their products can do (respective to their product categories). While one might argue that this gives both investors and target audiences greater choice, I would argue this homogeneity makes it far easier for startups operating in the enterprise sector to standout.

Making a sector bet in NYC isn’t a new strategy. Mike Lazerow has called his 2007 founding of NYC-based Buddy Media a ‘sector bet’ rooted in Facebook’s then emerging ecosystem of third-party services providers. Buddy Media was one of the earliest providers of B2B social media services in NYC, paving the way for the massive influx of social media startups operating in the city today. Earlier this year, of course, Buddy Media sold for $745M to enterprise company Salesforce.com, one of many early signals that the enterprise sector is regaining much of the ground it ceded to consumer and digital media over the last decade.

Talent Pool from the Finance Industry

We’ve received several job inquiries from investment bankers, all of whom have been searching for business development jobs. For these candidates, making the switch from banking to enterprise technology is far easier to grasp than a move to consumer tech, where products are seldom monetized and the buyer is hard to categorize.

Staying Grounded

In San Francisco there are so many startups it’s easy to forget that not all Americans actually work in the technology sector. The last time I was in the Valley, a city bus passed with an ad for a company I had never heard of. After expressing confusion, my friend, who had moved to San Francisco a year earlier to start his own tech company, informed me that this was the coolest new startup--how could I have possibly not heard of it?

In New York, you’re surrounded by more Fortune 500 companies than in any other city and brush by celebrities and Wall Street’s wealthiest on a daily basis. It’s pretty easy to stay humble here (though the rest of the world would tell you otherwise). And although the “techlebrities” featured in Bravo’s Startups: Silicon Valley have received significant backlash from Valley insiders, the very premise of the show would be hard to pull off in New York. (I don’t see the real housewives of New York facing any competition soon).

Unmatched Loyalty

In Silicon Alley, choices are limited if you want to work in tech, as opposed to larger industries like finance and media, which breeds a sense of loyalty. If you’ve ever spent a summer morning commute on a jam-packed subway car without air conditioning, you understand the “we’re all in this together” mindset. New Yorkers can reach a point of defensiveness when it comes to their city, and I’ve found the same to be true in New York’s burgeoning startup scene.

People here seem to work with a greater sense of urgency because of this loyalty and because of the pace of life attributed to the city. I’ll often hear of people leaving New York because of the city’s breakneck speed, so those remaining here have self-selected themselves as the kind of people who thrive in this fast-paced environment.

Resilience

It’s only been a year since I moved back to New York to launch BetterCloud, but as expected, the city hasn’t let me down yet. We’re excited to be a part of this nascent community and are confident more enterprise focused startups will make their way to the Big Apple. And I’ve never been more proud to be a New York startup founder than over the last week week. Hurricane Sandy, as horrible as the effects have been, has validated every reason why founding a startup in New York is the right move. Since the power went out on Monday night, we’ve seen the incredible kindness and resilience of this city. Whether it was the VC who offered us workspace, our employee who trekked on foot from West 99th Street downtown to our office on Tuesday when the rest of us were unable to get in touch, or the willingness of our employees to get to our temporary workspace on the Upper West Side by any means possible--bus, taxi and by foot. Our makeshift office has enabled us to work normal hours and the team has welcomed visits from employees’ loved ones (dogs included).

New York is a resilient city and this week has proven it. As the city is slowly restored and power is returned to our office, I’m certain that BetterCloud and the thousands of other companies impacted by Sandy, will come out stronger on the other side.

Startup News: Foursquare Day, Impact Investing, Assembled Capital and New Social Apps

Ben Weitzenkorn — Wed, 04 Apr 2012 08:00:49 -0400

Mayor Michael Bloomberg with Foursquare cofounder Dennis Crowley. The mayor declared April 16 NYC's official 4sqDay. (Ben Weitzenkorn)

2x2^2. April 16 is officially 4sqDay in New York and over a dozen other cities around the country. The fan-created social media holiday's official celebration will begin at 7 p.m. at The Caulfield. Check out the community blog and RSVP here.

CAPITAL IDEA. General Assembly is bringing back “Assembled Capital,” an all day event dedicated to getting startups funded. The $200 (plus a $4.97 fee) to get in is a bit steep, but breakfast, lunch and booze are totally included! The event will include talks, panels and plenty of elbow-rubbing time with the like of Squarespace's Anthony Casalena, TechStars NYC's David Tisch, Charlie O'Donnell of Brooklyn Bridge Ventures, Shane Snow of Contently and many others.

AIRbnFREE. Airbnb is teaming up with Thrillist and sponsoring Tour de Thrillist, a bicoastal race to discover all that LA, Vegas, Austin, Philly and of course NYC have to offer. Up for grabs is a five-destination trip and free Airbnb accommodations. Cross your fingers and enter the sweepstakes here.

SELL, SELL, SELL. New York-based Goodsie, a platform that allows anyone to setup their own store and sell pretty much anything, just announced the rollout of a host of new features to help merchants make smart business decisions including an integrated email marketing system, sales analytics and mobile optimization.

FIT FIGHT. Fitocracy, the fitness game that uses points and milestones to keep us motivated and moving, is now available on iOS. Users can see what their friends are up to and add and log new exercises right from the palm of their hand. To accompany the mobile app launch, Fitocracy has revamped their website, making it easier to see friends' updates, browse achievements, check scores and see how many points away from the next milestone they are. Slimkicker, a similar app, also made its iOS debut on the same day.

THERE'S ANOTHER MAPP FOR THAT. This week, MyCityWay, a mobile app that combines reference app information with city data, won the “Best Travel App” award at this year's Appy Awards. The app can be used for anything from job searches to driving direction to ordering Chinese food.

DEEP IMPACT. The next installment of the NYU Series on Impact Investing will be on April 9 at Vanderbilt Hall in Room 210 at 6:30 p.m. on the NYU campus. The panel discussion will focus on legal and policy issues and how they impact investments. This and future installments will focus on "issues related to the measuring of impact, the key regulatory questions raised by impact investing, and the role that development finance institutions play in impact investing." More information is available here.

STARTUPS 101. Last night, LEAN301 - Advanced Startup Metrics for Founders, the advanced version of the most popular class on Skillshare, held its first class. The class is taught by Lean Startup Machine founder Trevor Owens. Classes are limited to 12 students and future dates can be found here.

TO WHOM IT MAY CONCERN. Quotiply, a business app that connects companies and helps them collect, rate and assess offers from providers, just came out of beta last month. The app has profile, messaging and address book features built in and will even make suggestions to help members find good business partners. Quotiply is currently based out of Paris but CEO Paul Dupuy is currently in NYC with the team until the end of April. The company plans to move to NYC as soon as possible.

VIEWTUBE. Some pretty noticeable people including Hank and John Green, and Michael Aranda are using VYou, a video blogging platform, to answer questions and communicate with their fans. Annie Barrett of Entertainment Weekly uses the platform to do show reviews. Daily Candy has a channel where editors answer questions from the audience.

TECH SIDEKICK. Code for America needs a “Gotham Brigade Captain,” whose job will basically be to help bridge the gap between tech and government. The job will involve high-visibility and a firm grasp of the complex relationship between government, the law and technology. It sounds like a tough job but we really need someone to do it.

WHISTLE... Shapeways is looking for a community manager with at least four years of experience to synthesize and advocate for user needs as well as a software engineer proficient with PHP, Apache, MySQL, HTML and Java. Beyond NYC, Shapeways is hiring all over the world. Lifebooker needs a lead software engineer and architect with at least five years under their belt, excellent OO skills and proficiency in at least one programing language. Submit your application here. Conductor, Inc. has put out a call for an entry-level QA engineer with a bachelor's degree and sharp analytical and communication skills. Development operations engineers are needed at 2tor to manage and monitor their hosted server infrastructure. QA internship opportunities are open at Aviary and BetterCloud, 2tor is looking for PR, tech and development interns, Foursquare needs a community intern and ZocDoc has internship openings in design, marketing and IT.