Monday, November 10, 2014

• Uber is seeking to raise an addition $1 billion from new investors, possibly at a $25B valuation, structured as a convertible debt offering: Coverage here, here and here: We’ve heard the company is shopping the deal as a convertible debt offering, as opposed to a typical late-stage equity deal, with a valuation cap of $25 billion. Uber’s existing investors include Benchmark, Menlo Ventures, Google Ventures, TPG Growth, Kleiner Perkins, Fidelity, Wellington Management, BlackRock, Goldman Sachs, Jeff Bezos, Lowercase Capital, and First Round Capital, among others. With the financing Uber is seeking to add to that list and is pitching new investors on the deal. For Uber, structuring its financing as convertible debt would reduce its risk of dilution, particularly as the company seeks to raise so soon after its last round. The company is already extremely well-capitalized, having raised approximately $1.6 billion to date. Uber was even tested as a delivery partner for Amazon, and there’s a real possibility it could provide the framework for on-demand delivery of goods from other third-party providers in the future. All that is very capital-intensive, and Uber will need money to make money.

• Vee, an Indian mobile dating app gets $1M pre-series A funding, even as Momo, a similar Chinese app files for $300M US IPO: Founded in April this year, Vee received $1 million in its pre-Series A. Vee is a dating app that connects people who are single with others having the same tastes. It essentially helps users find out companions around their area and get into mutual relationships. The company claims that Vee can predict one’s approximate location, and based on the algorithms that work on the backend, it recommends people they may like around their area. For instance, when you see a profile on the app, you can like him/her anonymously. The other person will not get to know about it until he/she likes you back. The app connects you with people only when both the users have liked each other. As soon as you are connected, you can start chatting with them using the app. The interesting thing is that women users can choose to make the chats disappear in 30 seconds (so that they don’t have to worry about leaving a trail), and you can connect with multiple persons at a time. A free app, Vee is currently available on Android as well as iOS platforms. With the app, the company is targeting the youth population within the age group of 18-28. “We have seen more than 50,000 downloads across iOS and Android already. Over 23,000 pairs have been created and around 4.4 million messages exchanged on the platform so far,” explained Gupta. The firm is also looking to monetise the app in the near future by introducing a paid subscription model, wherein it will make a customised match to its premium subscribers and will organise meeting events for them.

• LinkedIn is being sued over Reference Search: The LinkedIn service in question is called “Reference Search.” It is available only to premium account holders, who pay a monthly fee. An employer or recruiter can use it to generate a list of people in its own network who worked at the same company at the same time as a job candidate. It also allows premium members to use the site’s messaging system to contact people who appear on those lists, without notifying a job candidate. In Sweet v. LinkedIn, a class-action suit filed last month in Northern California, the plaintiffs contended that LinkedIn, in providing the job reference material, enabled potential employers to “anonymously dig into the employment history of any LinkedIn member, and make hiring and firing decisions based upon the information they gather,” without ensuring that the information was accurate. This, they said, is a violation of the Fair Credit Reporting Act.