shameless rumormongering

Rumors & Acquisitions: Foursquare Vs. ZocDoc! Groundlink Vs. Uber! And Pinterest Vs. America

rumormonger

THIS TOWN AIN’T BIG ENOUGH! Guys, startup office space in New York is hard to find, and Betabeat is ON IT. Okay, so you remember how Foursquare and Tumblr both had their eyes on the tenth and eleventh floors of that sweet Soho elevator building at 568 Broadway where Thrillist, ZocDoc and Dennis Leary’s production company, Apostle are housed? Okay, so Foursquare was the favorite–but there may be a new contender.

Betabeat has learned that ZocDoc has been in the market for new space–60,000 square feet, ideally on one floor–for a move at the end of 2012. There’s not much out there that meets that criteria. Wouldn’t it be nice to take the tenth floor at 568 Broadway, directly above the teal-painted ninth floor? That way they wouldn’t have to say goodbye to that conference room with the mural of Sanjay Gupta high-fiving Dr. House! ZocDoc would probably really like it if Foursquare would only take one floor, which is more than three times the size of Foursquare’s current office, so that ZocDoc could take the other.

But both companies are growing like gangbusters–ZocDoc already expanded in March and then again in October, Foursquare is the hottest startup job in the city–and have to look out for expansion down the road. What’s a big startup in a small town to do?*

VERY PINTERESTING. Betabeat, when we first glimpsed the Silicon Alley darling Pinterest for ourselves: “It’s for girls!” Apparently, it’s also for middle America. Pinterest’s biggest market is Utah, we heard, and it’s gaining steam with users in other middle-America states, contrary to the usual outside-in adoption pattern most startups see.

Betabeat mentioned to a source that many peeps using Pinterest in New York, who responded. “Don’t people just use Svpply?” Do they? We don’t see too many peeps using Svpply either. One thing we do see peeps using is Tumblr–although we’ve documented that startup’s other problems on the business and developer relations fronts. Could Pinterest–which picked up New York angel Brian Cohen as an investor after taking the NYU Stern business plan competition by storm–be on the way to taking down two New York startups in one fell swoop? Read More

Secondary Markets

SecondMarket’s Barry Silbert Thinks That NASDAQ and the NYSE Are Broken

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On his blog New York Summer, HackNY fellow Akarshan Kumar has been thoughtfully posting about all the tech luminaries that come to influence young minds towards the start-up life and away from Wall Street. The latest lecture notes come from SecondMarket founder Barry Silbert, a former banker himself.

Using examples like the decreasing rate of IPOs over the past decade, the flash crash last May, the impact of high-frequency traders, and the decreasing average holding period of stock (down to just 2.8 months), Mr. Kumar says, “Silbert claimed that the public markets are broken, probably even beyond repair, and that the future lies in private markets.” Read More

The Start-Up Rundown

Start-Up News: Baller Edition

Basketball_Hoops

YEAH, YEAH. The metal label Century Media, which represents such artists as 3 Inches of Blood and Aborted, is ditching Spotify. “While everyone at the label group believes in the ever changing possibilities of new technology and new ways of bringing music to the fans, Century Media is also of the opinion that Spotify in its present shape and form isn’t the way forward,” a press release informs us. “The income streams to the artists are affected massively and therefore that accelerates the downward spiral, which eventually will lead to artists not being able to record music the way it should be recorded. Ultimately, in some cases, it will completely kill a lot of smaller bands that are already struggling to make ends meet.”

But the label waffled a little: Read More

Secondary Markets

Two of SecondMarket’s Most-Watched Companies Are From New York

secondmarket

SecondMarket just released its second-quarter report from 2011 and by the looks of things, secondary market investors are as frothy-in-the-mouth as public ones. In the first half of the year, the online platform completed $268 million in private company stock transactions, a 75 percent year-over-year increase from the first half of last year. Considering SecondMarket typically takes a three to five percent fee, a back of the envelope calculation means that brought in about $8 million to $13.4 million in gross revenue from those trades. Although SecondMarket’s Girl Friday, Aishwarya Iyer told Betabeat, the that percentage is very general. “It depends on the amount of leg-work required, and numerous other factors.”

As is befitting the current boom, in the second quarter, consumer web and social media companies, representing 87.3 percent of transactions, thoroughly trouncing business products and services with 7.3 percent of transactions and retail and commerce with just 5.1 percent.

So who are the buyers aggravating pre-IPO founders by trolling SecondMarket for shares and driving up valuations? Zuck can blame accredited investors, who bought 46.7 percent of the dollar amount of transactions, hedge funds with 22.2 percent, and asset managers with 14.7 percent. (VC funds were responsible for a scant 0.2 percent of the dollar amount.) Read More

Secondary Markets

Wall Street Investment Firm Sues SecondMarket Over $2.4 Million in Facebook Shares

SecondMarket founder Barry Silbert

New York City-based Felix Investments is suing SecondMarket in the New York Supreme Court over a $2,475,000 deal for Facebook shares that never came to fruition. Felix began investing in Facebook back in 2009 through two funds named Facie Libre 1 and Facie Libre II–meaning face book in Latin–and did a brisk business with SecondMarket. Dealbook’s Evelyn Rusli recently described Felix investors as “not part of Silicon Valley’s elite” and “more comfortable navigating the narrow streets of Lower Manhattan than on tree-lined Sand Hill Road in Menlo Park.” The suit is over a deal in January 2010 to buy 75,000 shares from Karl Voskuil, a Facebook software engineer, at $33 per share. Read More

Secondary Markets

Bubble Anxiety at Facebook Is a Boon For SecondMarket

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If there’s one tech scenester not worried about Mark Zuckerberg taking his sweet time to IPO, it’s probably New York’s Barry Silbert. That’s because dotcom bubble déjà vu at the Palo Alto headquarters tends to translate into more business for SecondMarket, Silbert’s online exchange for shares in private companies.

Last year, Facebook shares from early employees (before Zuck limited equity to restricted stock that can only be sold after the company goes public) accounted for nearly 45 percent of all trades on SecondMarket. Today, the New York Times reports, about 100 early employees have left the company, in many cases opting to cash out while valuations are still stratosherpic. “If you’ve seen the world blow up once, you just don’t know what’s going to happen a year from now,” an anonymous former Facebook employee told the Times. Read More