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.

Dwolla is a payment network that allows users to transfer money back and forth for free for transactions under $10 and a flat rate fee of $0.25 for those over $10. The platform hooks directly up to your bank account and offers transfer fees lower than what banks or credit card companies typically charge, positioning it as a legitimate competitor to conglomerates like Visa and Mastercard (not to mention that rumored deal with Square).

But the company also appears to have PayPal in its sights. In October, Dwolla announced a new MassPay feature that competes with PayPal's "Mass Payment" function; MassPay allows users to send out payments to up to 2,000 people at once with just a few clicks. It's worth noting that Jeff Jordan, the former President of PayPal, is a partner at Andreessen.

This is one of the largest investmens Andreessen has made in a payment services startup, though it's made smaller bets on Stripe, a payment system for developers, and Balanced.

Mr. Weiss, who led the investment, explained on his blog why the firm chose to make such a big bet on Dwolla:

• Founder/market fit: Ben is one of the most determined and scrappy entrepreneurs we’ve met and has a deep knowledge of the entire payment network.

• Ridiculous market size: Dwolla’s FiSync is taking on ACH and FedWire, a combined $730+ trillion market with real-time transactions, new revenue streams and incentives for key players in the payment process.

• A snowball of traction: Its annual processing run rate has moved from the hundreds of millions to billions and its business development pipeline is chock full of opportunities.

Mr. Weiss signed off: "I am excited to be joining Dwolla’s board of directors and look forward to helping Ben build the next multi-billion dollar payment company!" Enjoy all that dough, boys.

*Disclosure

(Photo: AlanLevenson.com)

In a stunning gesture of support for EXCLUSIVE airplane journalism, Amazon CEO Jeff Bezos is leading a $5 million round in Business Insider, the web property helmed by Henry Blodget. The news comes following a detailed New Yorker profile of Mr. Blodget, who launched Business Insider after being banned from the securities industry for civil securities fraud.

An internal memo published on Business Insider (natch) written by Mr. Blodget says that the company is raising $5 million, with Mr. Bezos chipping in "a significant investment." The fresh capital brings Business Insider's total amount raised to $18.3 million.

"This capital will allow us to continue to invest aggressively in many areas of the business, including editorial, tech/product, sales and marketing, subscriptions, and events," Mr. Blodget wrote. "As we mentioned last night, it will also allow us to expand our office."

The raise comes at a time when the company is reportedly losing money, though Mr. Blodget has pegged its $3 million loss in 2012 as an "investment." According to Paid Content:

TBI chairman Kevin Ryan says the company will do $11 million this year (last summer someone told the WSJ the company would do $12 million in 2012); he says the site has only spent $7 million of the $13 million it has raised.

Though Comscore pegs the site’s traffic at 9 million, Blodget tells Auletta that his Google Analytics numbers are at 24 million unique monthly users, many of whom come from outside the U.S.

AllThingsD’s Peter Kafka notes that since the New Yorker profile was published on Monday, BI’s revenue projections jumped--sorry, JUMPED--from $11 million to $15 million.

Mr. Blodget has a history with Amazon. He originally rose to fame in 1998 by accurately predicting a price target of $400 in Amazon stock, which eventually led to his hiring at Merrill Lynch.

The investment will likely increase the number of stated disclosures for BI writers covering Amazon products or services, as well as Mr. Bezos' other investments. But the editorial side must be accustomed to negotiating that ethical line, as it already counts powerhouses like Marc Andreessen and Allen & Company as investors. And the writers there don't seem to mind adding another one to the list. "Do you really think I'm going to care what some billionaire thinks about my Kindle whatever review?" tweeted Silicon Alley Insider editor Steve Kovach.

(Photo: Twitter/Shanley)

This is a guest post by Shanley Kane. It was originally published on her blog Pretty Little State Machine and is republished here with her permission. Ms. Kane works in product management and enterprise software in San Francisco and is interested in culture studies, the developer community and television for fun. You can (and should!) follow her on Twitter here. 

Toxic lies about culture are afoot in Silicon Valley. They spread too fast as we take our bubble money and designer Powerpoints to drinkups, conferences and meetups all over the world, flying premium economy, ad nauseam. Well-intentioned darlings south of Market wax poetic on distributed teams, office perks, work/life balance, passion, “shipping”, “iteration,” “freedom." A world of startup privilege hides blithely unexamined underneath an insipid, self-reinforcing banner of meritocracy and funding. An economic and class-based revolt of programmers against traditional power structures within organizations manifests itself as an (ostensively) radical re-imagining of work life. But really, you should meet the new boss. Hint: he’s the same as the old boss.

The monied, celebrated, nuevo-social, 1% poster children of startup life spread the mythology of their cushy jobs, 20% time, and self-empowerment as a thinly-veiled recruiting tactic in the war for talent against internet giants. The materialistic, viral nature of these campaigns have redefined how we think about culture, replacing meaningful critique with symbols of privilege. The word “culture” has become a signifier of superficial company assets rather than an ongoing practice of examination and self-reflection.

Culture is not about the furniture in your office. It is not about how much time you have to spend on feel-good projects. It is not about catered food, expensive social outings, internal chat tools, your ability to travel all over the world, or your never-ending self-congratulation.

Culture is about power dynamics, unspoken priorities and beliefs, mythologies, conflicts, enforcement of social norms, creation of in/out groups and distribution of wealth and control inside companies. Culture is usually ugly. It is as much about the inevitable brokenness and dysfunction of teams as it is about their accomplishments. Culture is exceedingly difficult to talk about honestly. The critique of startup culture that came in large part from the agile movement has been replaced by sanitized, pompous, dishonest slogans.

Let’s examine popular startup trends that are being called “culture” and look beneath the surface to find the real culture that may be playing out beneath it. This is not a critique of the practices themselves, which often contribute value to an organization. This is to show a contrast between the much deeper, systemic cultural problems that are rampant in our startups and the materialistic trappings that can disguise them.

We make sure to hire people who are a cultural fit
What your culture might actually be saying is… We have implemented a loosely coordinated social policy to ensure homogeneity in our workforce. We are able to reject qualified, diverse candidates on the grounds that they “aren’t a culture fit” while not having to examine what that means - and it might mean that we’re all white, mostly male, mostly college-educated, mostly young/unmarried, mostly binge drinkers, mostly from a similar work background. We tend to hire within our employees’ friend and social groups. Because everyone we work with is a great culture fit, which is code for “able to fit in without friction,” we are all friends and have an unhealthy blur between social and work life. Because everyone is a “great culture fit,” we don’t have to acknowledge employee alienation and friction between individuals or groups. The desire to continue being a “culture fit” means it is harder for employees to raise meaningful critique and criticism of the culture itself.

Meetings are evil and we have them as little as possible.
What your culture might actually be saying is… We have a collective post-traumatic stress reaction to previous workplaces that had hostile, unnecessary, unproductive and authoritarian meetings. We tend to avoid projects and initiatives that require strict coordination across the company. We might have difficulty meeting the expectations of enterprise companies and do better selling to startups organized like us. We are heavily invested in being rebels against traditional corporate culture. Because we communicate largely asynchronously and through chat, it is easy to mentally dehumanize teammates and form silos around functional groups with different communications practices or business functions.

We have a team of people who are responsible for organizing frequent employee social events, maintaining the office “feel”, and making sure work is a great place to hang out. We get served organic, vegan, farm-raised, nutritious lunches every day at work.
What your culture might actually be saying is… Our employees must be treated as spoiled, coddled children that cannot perform their own administrative functions. We have a team of primarily women supporting the eating, drinking, management and social functions of a primarily male workforce whose output is considered more valuable. We struggle to hire women in non-administrative positions and most gender diversity in our company is centralized in social and admin work. Because our office has more amenities than home life, our employees work much longer hours and we are able to extract more value from them for the same paycheck. The environment reinforces the cultural belief that work is a pleasant dream and can help us distract or bribe from deeper issues in the organization.

20% of the time, or all of the time, people can work on whatever they want to
What your culture might actually be saying is… We have enough venture funding to pay people to work on non-core parts of the business. We are not under that much pressure to make money. The normal work of the business is not sufficiently rewarding so we bribe employees with pet projects. We’re not entirely sure what our business objectives and vision are, so we are trying to discover it by letting employee passions take root. We have a really hard time developing work that takes more than a few people to release. We have lots of unfinished but valuable projects that get left behind due to shifts in focus, lack of concentrated effort, and inability to organize sufficient resources to bring projects to completion.

We don’t have managers and the company is managed with no hierarchy
What your culture might actually be saying is… Management decisions are siloed at the very top layers of management, kept so close to the chest they appear not to exist at all. The lack of visibility into investor demands, financial affairs, HR issues, etc. provides an abstraction layer between employees and real management, which we pretend doesn’t exist. We don’t have an explicit power structure, which makes it easier for the unspoken power dynamics in the company to play out without investigation or criticism.

We don’t have a vacation policy
What your culture might actually be saying is… We fool ourselves into thinking we have a better work/life balance when really people take even less vacation than they would when they had a vacation policy. Social pressure and addiction to work has replaced policy as a regulator of vacation time.

We are all makers who are focused on shipping.
What your culture might actually be saying is… Features are the most important function of our business. We lack processes for surfacing and addressing technical debt. We have systemic infrastructure problems but they are not relevant because we are more focused on short-term adoption than long-term reliability. We prioritize fast visible progress, even if it is trivial, over longer and more meaningful projects. Productivity is measured more by lines of code than the value of that code. Pretty things are more important than useful things.

Closing
Talk to your company about culture. Talk to other companies about culture. Stop mistaking symbology and VC spoils for culture. Be honest with yourself, and with each other. Otherwise, your culture will kill you softly with its song, and you won’t even notice. But hey, you have a beer keg in the office.

BuzzFeed raises $20M to build Snackadium.

BuzzFeed, the Internet's biggest time suck, announced in a press release today that it has raised $20 million in a series D round led by NEA Ventures, bringing its total raised to $46.3. In addition to churning out more image-heavy listicles and starting spats with fellow popular Internet properties like Gawker and The Oatmeal, BuzzFeed intends to use the money to "build the next great media company."

A year ago, BuzzFeed hired its editor-in-chief, Ben Smith, away from Politico in an attempt to broaden the depth of serious news coverage on the platform. It worked, kind of: the site's election coverage was impressive, and there has been more emphasis on longform narrative, but it can be difficult to reconcile serious political news and contemplative pieces with goofy native ads like "10 Easy Steps to Building the Ultimate Snack Stadium"--even if the latter finances the former.

"We think BuzzFeed will be one of the great media companies of the next decade," said NEA investor Patrick Kerins in a statement.

Indeed, look bald-faced into the future of a new new new media company: according to BuzzFeed founder Jonah Peretti, it is "socially native, tech enabled, with massive scale." Perhaps, it's a new iteration of the "mullet strategy" he's talked so much about. Top posts (currently including ScarJo looking like Christopher Walken and "How I Lost My Virginity, In GIFs) lure in readers for more thoughtful fare.

Financing and running a sustainable media company in this day and age is no small feat, and BuzzFeed has the added hurdle of attempting to establish itself as a reliable news organization while also churning out sillier content. This new raise will undoubtedly put more pressure on the company to bulk up its credibility.

Nonetheless, we eagerly await the BuzzFeed post, 10 Reasons We Raised $20M to Write More Things Like "Pretty Japanese Girls React to Drinking Poop Wine." We'd definitely click on it.

Mr. Merriman (ny.tie.org)

Look out, Oracle: a swiftly-growing open source startup could be coming for you. 10gen, the New York-headquartered database company that boasts clients like Foursquare, MTV and Disney, announced today that it had raised a $42 million round led by New Enterprise Associates.

CEO Dwight Merriman said in a statement:

We want to change the database market, to make MongoDB the best way for companies to build new applications. Our goal is to give tech teams not only a database that scales to any big data level required but also helps developers be productive and more nimble.

10gen has worked feverishly to establish itself as an innovative open source database company with strong ties to the New York tech scene. When we spoke with 10gen CTO Eliot Horowitz last month following a recent partnership with Red Hat, he told us that 10gen's need for systems engineers--and not just app builders-- is "bringing an entirely different type of engineer to New York, and it's good for the overall ecosystem. Long-term it makes the engineering talent pool much wider and deeper.”

We're sure that this new hefty chunk of change will serve New York's budding systems geeks quite well.

Peter Lehrman, AxialMarket's CEO (firstround.com)

Here's a quickie for your Tuesday evening: AxialMarket, an online network that connects potential buyers and sellers of private businesses, has raised $6.5 million, according to a Form D filed with the SEC.

According to Crunchbase, AxialMarket is an amalgam of corporations and investment companies that join the platform "to source deals, communicate and promote their firm’s acquisition and investment identity, and uncover opportunities to collaborate with other members."

The company has largely managed to skirt an overabundance of hype while quietly collecting over 7,000 qualified members on their platform. Perhaps it's because their idea isn't as sexy as "sweet delivery spectacles" or "broadcast TV on your laptop." But with $6.5 mil of fresh dough in their pockets, seems like it's working out just fine.

Mr. Cheever (flickr.com/techrunch)

Those Facebookers are making it rain and the IPO isn't even scheduled until Friday. The Wall Street Journal reports today that ex-Facebookers Adam D'Angelo and Charlie Cheever have raised a new $50 million round of funding for their Q&A site Quora, led by--surprise!--Facebook board member Peter Thiel.

The news comes on the heels of a New York Times piece that chronicled the new "circle of tech:" collect payout, do a startup.

According to the Journal:

The investment is a sign of how the Facebook "mafia" is flourishing in Silicon Valley, helping to fuel new start-up activity....Mr. Heiliger said one of the key reasons he invested in Quora is because of his friendship with Mr. D'Angelo and Mr. Cheever when they all worked together at Facebook several years ago.

A source told us a few months ago that he didn't have high hopes for Quora, but the company is now apparently valued at $400M. Between this and Instagram, perhaps the Facebook mafia can catchup to PayPal yet.

Update: A source wrote in to tell us that Benchmark Capital also contributed to the round. Well, well.

Diego Saez-Gil, InBed.me's cofounder and CEO (twitter.com)

Everyone knows that opting for hostels instead of hotels can save you tons of money on travel costs, but for the more anxiety-prone among us, sometimes the fear of having to sleep three feet away from a stranger can outweigh a hostel's benefits. InBed.me, a New York-based social booking site for hostels, beds and couches, wants to take the terrifying mystery out of hostel stay by allowing users to meet and interact with others who will be traveling and staying in the same hostels.

InBed.me offers the option to sign up for the site using Facebook. Once you book your hostel or couch trip, your picture appears under the property so that other users can see the kinds of characters that typically stay at such a venue. The concept reminds us of Airbnb--except with more hostels and a stronger emphasis on a trip's social component.

The founders of InBed.me have a lot of experience globe-trotting and hostel-staying; they all originally met in a hostel in Brooklyn before starting the company. Recently, InBed.me announced that they've raised $1.2M in seed funding from a group of international investors. According to the press release:

The new funding will enable inBed.me to grow the team in order to accelerate the development of the product by adding more social features, integrating with other social networks and developing the mobile app, as well as expanding their inventory of properties in South America with special focus in Brazil, and to invest in marketing to grow their base of users. InBed.me will focus in the initial stage in American young travelers traveling to South America, which is a growing destination among backpackers and young travelers.

It makes sense that the group would focus on South America--it is a hot spot for young travelers--but also because cofounder and CEO Diego Saez-Gil is originally from Argentina, and his cofounder and CTO Alex Torrenegra is from Colombia.

"For us being a travel company, we need to be global from day one," Mr. Saez-Gil told Betabeat email.

That seed money should help expand their reach, but what are they going to do about that godawful company name?

SocialGuide, a startup that determines what TV shows and movies are popular by combing Twitter and Facebook, is in the process of raising a $500,000 debt round, according to the company's latest SEC filing via FormDs.com. The first sale of securities, which includes both "debt" and "option, warrant or other right to acquire another security," was on January 17th. SocialGuide has already raised $400,000 from 10 investors towards the round, with $100,000 to go.

"We are in a position as a company where we’re looking to achieve profitability over the next two quarters," CEO and founder Sean Casey told Betabeat by phone. "We decided to put together a note that will help us get there. It was just the right financing."

The Brooklyn-based service, located at 68 Jay Street in Dumbo, bills itself as "the first real-time Social Programming Guide." By ranking what's popular on social networks, according to keywords counts, and then surfacing "the shows that your friends are talking about," the company is able to recommend what's worth watching. No more hearing about the "Downtown Abbey" Christmas special a week after everyone else tumbled their favorite Dowager Countess-isms. In September, SocialGuide, which previously went by the name Talkwit, introduced a similar service for movies, which is currently in beta.

But its real value may be in data it collects about the budding field of social TV.

Mr. Casey said the financing would be used to support new hires and revenue-generating products SocialGuide is planning to push in the near future. That includes an upcoming social TV data analytics and audience engagement platform called SocialGuide Intelligence that it will be launching along "with major cable networks." SocialGuide is also launching API solutions used by third-parties to power social TV guides on set-top boxes, connected TVs, and second-screen applications, like a cable provider's iPad app. Its Social TV APIs will include, "Guide, Streams, and Meta Content and Recommendations," said Mr. Casey.

"We focus on the social activity happening around U.S. TV," noted Mr. Casey. SocialGuide claims to have captured 300 million social TV comments and matched them to over 40,000 unique television shows, which he says makes it the "most comprehensive in the marketplace." The company started collecting data on movies in May and currently covers all movies in U.S. theaters.

Prior to this current round of funding, SocialGuide secured a $1.5 million equity round led by a number of angel investors including Alex Zubillaga, the former head of digital strategy at Warner Music. Mr. Casey said "largely everybody participated" in this round as well and promised some big partnership announcements in the coming weeks. In the meantime, Mr. Casey seems to have borrowed a page from the OkCupid rulebook and managed to keep itself in the press by mining in-house data for notable TV trends, such as the irrepressible charms of Snooki & Co.

Mr. Goldberg. (twitter.com/betashop)

For any startup looking to raise venture funding--or even VCs trying to figure out what entrepreneurs want (where is Mel Gibson on that, anyways?)--Jason "Prince of Pivoting" Goldberg offers a transparent look at how he went about raising $40 million for Fab.com led by the likes of Andreessen Horowitz.

In Mr. Goldberg's case, he faced the added pressure of not having time to go through the usual dog-and-pony show during the run-up to Fab.com's first ever holiday season. (Yes, that's right, that $40 million came just six months after the company swerved from a gay social network to a flash sales site for design.)

So the serial entrepreneur decided to do things a little differently.

According to Mr. Goldberg, the rules of funding are not so different from The Rules itself:

"It’s also a lot like dating. You have to go on a lot of first dates before you can move on the to the second, third, fourth, and then hopefully marriage. The worst thing you can do is slut around. It wastes a ton of time, can damage your reputation, and doesn’t get you far."

Keeping that time constraint in mind, rather than wasting precious hours on slow dance of talking about team, leadership, and vision, he jumped right into the good part: the core numbers--something VCs often don't look at until the end of the process. Thus, he began the funding process by sending each potential investor he'd identified as a good candidate a login to Fab.com's RJ Metrics Dashboard to see for themselves if they wanted to learn more.

It's not until a p.s. at the end of the blog post that we learn that Mr. Goldberg tried to invest in RJ Metrics since they proved so useful, but basically the company provides a business intelligence dashboard connected to your production database that updates every few hours and produces some handy graphs.

"As a dashboard it’s fantastic, but the real power of RJ is in its cohort analysis — RJ enables you to effectively monitor each cohort of users by join date and then then evaluate their revenue contribution, payback periods, engagement levels, and lifetime value."

Starting with the numbers helped "[tee] up a series of well-educated discussions with the VC’s around the next level of data analysis, e.g. trends amongst cohorts, time to 1st purchase, and repeat purchase rates," writes Mr. Goldberg. For those worried about exposing that level of information about a young company, Mr. Goldberg offers the following tautology:

"The data is the data is the data. If you can’t measure it, it never happened. Any investor worth their salt needs to understand your data before they invest, or you don’t want their money anyway. So, put it all out there. If the data is good, it’ll speak for itself, and then you need to tell the story of how it gets even better. If the data isn’t good, well, then you need to tell a story of how you are going to turn it around. Either way, the data is the data is the data."

In the end, it seems like Mr. Goldberg found the right fit in Andreessen Horowitz partly because of its response to the numbers:

"Jeff [Jordan] and his partners — more than any other firm we talked to — really jumped right into the data, digested it, analyzed it, and then quickly focused on how they could work with us to realize our big vision."

Although Mr. Goldberg claims that "we didn’t focus on valuation much at all," we imagine he didn't exactly object to a $175 million jump in valuation, currently teetering at $200 million.

Now, how about we get really meta and have RJ Metrics do a behind the scenes blog post about what happened when Mr. Goldberg asked to invest?