Despite the market slowdown, Israel’s technology sector seems to be doing well. The Israel Venture Capital research center released promising figures about last quarter’s venture capital funding. Third quarter VC funding in the Israeli tech sector rose by 45% as compared with the same period last year.

Around $600 million was raised by 124 companies last quarter. By contrast, in the third quarter of 2007, $414 million was raised.

The top sector to raise capital was communication followed by Internet.

The downside of the news is that Just 28% of the funding went to new startups. A year ago, 51% of the funding was for new startups.

Via: Globes Online

Jobfox, is a Washington D.C.-based career web site that has a staff of 50.  Jobfox was started by Rob McGovern, founder and former Chairman/CEO of CareerBuilder.com.  The company trys to match people with ideal jobs based on The 10 Dimensions of a Good Job Fit (sm).  The company has announced today that they have raised $20 million in Series C funding.  Draper Fisher Jurvetson led the round and Mark Bailey will be taking a board seat for Jobfox.

Menlo Ventures and New Enterprise Associates also returned for the investment.

Jobfox will open new offices New York, Los Angeles, Chicago, Seattle, Dallas and Houston with the funding.  These offices join their other U.S.-based offices in Atlanta, Boston, San Francisco, and Washington D.C. [Information Source: Private Equity HUB].

Jobfox may also expand internationally through a partnership with an Australian company.  Jobfox has raised about $40 million since their initial funding.

Pluck is a syndication firm that enhances their clients web sites by helping them increase page views, improve community and networking platforms, ensure return visitors, and manages the monetization of the site.  Some of Pluck’s customers include Circuit City, Condé Nast, Discovery Communications, Economist, News Corp., Reuters Media, and TheStreet.com.  The Austin, Tex.-based company is hoping to be acquired for $75 million.

AOL, Yahoo!, and Microsoft are potential buyers.  According to paidContent, they have received at least one offer.  Reuter’s, Mayfield, and Austin Ventures have invested $17 million in funding for Pluck since they started in 2003.  Pluck also set-up the new USAToday.com look and feel.  Today Pluck announced that they redesigned Guardian News and Media as well.

The founders of Pluck includes Dave Panos and Andrew Busey.  Busey is a Strategic Advisor and Dave Panos is the CEO.

Funny or Die, the slapstick video hub created by former Saturday Night Live cast member, Will Ferrell announced that they have raised $15 million from Sequoia and several other unnamed investors.  Funny or Die is especially known for its viral video, The Landlord in which a baby abuses Will to pay the rent… or else.

Sequoia has backed Funny or Die since it started around April 2007.  Gary Sanchez Productions and Adam McKay are also heavily involved with Funny or Die.  Adam McKay also co-wrote Anchorman: The Legend of Run Burgundy and Talladega Nights: The Ballad of Ricky Bobby with Will Ferrell.  Adam McKay’s daughter, Pearl played the actual landlord on the Funny or Die video clip, The Landlord.  McKay is married to Shira Piven, sister of Jeremy Piven (Ari Gold on HBO’s Entourage and Dean Pritchard in Old School).

Funny or Die plans to use the funds to hire engineering and creative talent. Currently there are 30 staff members working with Funny or Die and the company is developing a model to compensate users that submit viral content.  It certainly is refreshing to see Hollywood embracing the entrepreneurial Web 2.0 spirit.

Information Source:
[1] Portfolio.com: Will Ferrell and the End of Media as We Know It

DIGG
The acquisitions that Yahoo!, Google, Microsoft, and eBay have made over the last year has made
things a lot more interesting. Between these 4 companies, they have acquired social networks and VoIP technologies that have banking companies swooning just like they were in the late 90’s and early 2000’s.

During Digg’s tenure as a Web 2.0 company, they have received over $10 million in funding. Kevin Rose, the founder of Digg has also been working on a couple of other start-ups, Revision3 and Pownce. Rumor has it that Digg CEO, Jay Adelson has hired Allen and Company, an investment banking firm to broker a deal worth $300 million or more in the form of an acquisition. Rumor also has is that InterActivCorp is one of the leading interested parties in an acquisition.

In my opinion, I think Digg is great property for an acquisition. But for the amount that they are looking for seems a little stretched. I think this because I feel that Digg users seem rather unstable and are constantly being tampered with. In the last couple of years, Digg has removed the listing of their top users, created a new social network that involves “Shouting Out” stories to other users (which seems more like spam to me), and even saw a major user revolt late April/early May 2007 (remember 09-f9-11-02-9d-74-e3-5b-d8-41-56-c5-63-56…. controversy?). Digg gives a lot of control to the end user which can be a strength, but can also be a major weakness. Digg users tend to be sensitive and over-express it when they feel like Kevin Rose/ Digg isn’t acting like “one of the people.”

Will Digg see an acquisition soon? So far it’s only speculation since there have been multiple opportunities for Digg to become acquired.

BEBO
Social network, Bebo is also rumored to have hired a bank in order to either raise a substantial amount of funding or for an acquisition. Bebo reports that they have more than 40 million total users, of which 12 million are active in the UK and Ireland. Traffic has doubled since last year for Bebo. I picked up the rumor from VentureBeat.

Bebo is also working with Google on OpenSocial, an open-source developer platform to let third parties create applications on their own social network, similar to Facebook Applications. Bebo has reportedly seen itself being courted for an acquisition before, but none that have gauged its interest of a price-tag above $1 billion.

Social networks are a hot commodity, but with other social networks like MySpace, Friendster, Facebook, Hi5, and Orkut, the market is just becoming more saturated. Brokering such a deal through a bank will be challeging given today’s market.

Penthouse History
Penthouse magazine was started Bob Guccione in 1965.  The publication company competes directly against the Hustler, Playboy, and Maxim.  Penthouse’s parent company is Penthouse Media Group (formerly known as General Media Inc.).  And Penthouse Media Group’s former parent company was Penthouse International Inc., but is no longer the case because of a chapter 11 restructure.

The publication company enabled Guccione to be considered at one point one of the richest men in the U.S., worth $400 million in 1982.  General Media Inc. became Penthouse’s parent company in 1993 when the company went public through an $85 million U.S. SEC registered bond offering.  Jefferies and Co. led the junk bond offering.  The primary bond buyer was MacKay Shields, a division of the New York Life insurance.

Then in 1997, Cerebus Capital Management (the hedge fund company that bought Chrysler for $7.4 billion) started buying General Media Bonds in the open market.  And Penthouse sold some of its automotive publications to Peterson Automotive for $33 million.  In 2003, General Media filed for Chapter 11 bankruptcy protection.

In 2004, General Media came out of bankruptcy with the help of three investors who are now the owners:
1.) Marc . Bell, a South Florida real estate developer and founder of Globix Corporation.
2.) Daniel Staton, former COO and EVP of DFluke Realty Investments Inc. and President of Walnut Capital Partners.
3.) Florian Humm, a German hedge fund manager

Penthouse’s Acquisition Investment for Various Inc.
“For now, we are holding on to everything,” stated Bell.  The NY Times said that the goal was to give their demographic consumers of 18-34 year old men a wider variety of their content.  “The rationale here is, it’s an online world.”

Penthouse is taking $500 million and investing into the acquisition of Various Inc.  Various Inc. owns 25+ social networking sites and has a total member base of 260 million consumers.  About 1.2 million of them are paid subscribers.  The combined revenue for Various Inc. and Penthouse is expected to be $340 million in 2007.  Various Inc. owns:
1.) FastCupid
2.) AdultFriendFinder
3.) FriendFinder
4.) Passion.com
5.) gradFinder
6.) IndianFriendFinder
7.) AsiaFriendFinder
8.) Guanxi.com
9.) SeniorFriendFinder
10.) Amigos.com
11.) GermanFriendFinder
12.) ItalianFriendFinder
13.) GayFriendFinder
14.) JewishFriendFinder
15.) NiceCards.com
16.) QuizHappy.com
17.) BreakThru.com
18.) FrenchFriendFinder
19.) KoreanFriendFinder
20.) FilipinoFriendFinder
21.) BigChurch.com
22.) Slim.com
23.) ShareRent.com
24.) Dine.com
25.) FriendPages
26.) Outpersonals.com
27.) ALT.com
28.) Cams.com

Amazon.com announced today that they are investing in Bill Me Later, Inc. Not only that, but Amazon is also signing a agreement with the online billing company as well. eBay and PayPal has thus far proved the synergy of combining an online retailer with an online billing payment company. Over 90% of all eBay auctions are paid via PayPal so it made sense for eBay to buy them for $1.5 billion.

“Bill Me Later has developed a very customer-centric method to make online shopping even easier,” stated Matt Swann, VP of payments at Amazon.com. “We are pleased to make the convenience of Bill Me Later available to our tens of millions of Amazon customers [source: Amazon.com press release].”

The investment terms were not disclosed, but the company has $200 million in funding capital according to TechCrunch. Bill Me Later investors include Chase Paymentech, Azure Capital Partners, First Data Corp, Crosspoint Venture Partners, GRP Partners, CIT Group Inc., Citigroup Corporate and Investment Banking, Citigroup, Equifax, T. Rowe Price, and Legg Mason Inc.

“Amazon.com and Bill Me Later share the same commitment to making shopping easy for consumers,” stated Gary Marino, the CEO of Bill Me Later. “Just as Amazon invented a new and better way for people to shop online, Bill Me Later has created a new and better way for people to pay for purchases online.”

Before joining Bill Me Later, Marino was an EVP, Chief Credit Officer, and Chief Marketing Officer of consumer lending at First USA/Bank One.

Microsoft signed a check to Facebook with a pen that was heard around the world.  The amount Microsoft gave to Facebook was an astounding $240 million for a mere 1.6% equity in the company. 

Li Ka-shing, a billionaire in Hong Kong decided that he wanted to ride the wave of Facebook’s success as well.  This is why Ka-shing invested $60 million (roughly 467,415,544.52 Hong Kong Dollars) in Facebook according to Kara Swisher.  Facebook now has nearly $340 million in capital.

Li Ka-shing is the chairman of Cheung Kong Holdings and Hutchison Whampoa Limited.  The investment in Facebook was not made directly through company money, but from a different entity. 

Ka-shing is worth $23 billion and is considered the richest man in Asia (9th in the world).  “The deal with Ka-shing came through a Facebook investor, who introduced the company to Solina Chau, director of the Li Ka-shing Foundation [Kara Swisher].” 

In related news, the media was recently speculating whether or not Facebook was attemping to buy out Zhanzuo, a Chinese social network.  But then the rumor was later denied. 

Friendster and MySpace both have Chinese versions of their social networks.  This investment may give Facebook an incentive to expand their operations for the world’s largest and most populous country.

An official announcement has not been made yet.  Keep checking Pulse 2.0 for when the investment is confirmed.  This specific blog post will be updated.

Snooth is “the world’s most comprehensive wine database, featuring millions of reviews and hundreds of thousands of wines [Snooth: About us].”

The word Snooth used as a transitive verb means:
1. to seek out a preferable wine, as like a snooth (”I say, snooth the wine list while I choose an appetizer.”)
2. to uncover details of a specific wine (”Snooth this Chianti Classico for me, would you?”)

Snooth raised about $1 million in a second round of angel funding. Snooth’s first round of seed funding was roughly $300,000. The company allows users to write and read reviews on wine. Wine can also be purchased from third-party vendors through Snooth. The wine social network also has a built-in search to find wine based on taste, year, and varietal.

Philip James started Snooth in 2006. James is a former an Exec VP at Wine Messenger and also spent 3 years working in Technology Investment Banking at Merrill Lynch.