Three years ago, Conde Nast bought out Reddit. Reddit is a website where a community of users vote on the most interesting stories. The most interesting recent stories land on the Reddit homepage and receive a large number of visits. Conde Nast has been taking a hit lately as its been discovered that they may lose $1 billion in ad revenue this year.
Steve Huffman and Alexis Ohanian both founded Reddit after launching it from Y-Combinator. Christopher Rowe and Aaron Swartz joined the team shortly after the company was founded. Y-Combinator is an incubation firm started by Paul Graham. Both of the Reddit founders are leaving for personal reasons.
Huffman is moving back to Virginia to spend more time with his wife. Ohanian plans to spend some time traveling. Rowe will be staying with Reddit for a while. Swartz was fired from Reddit two years ago for not respecting the company rules after being acquired by Wired Magazine.
It seems that whenever a company gets featured by Apple, they will immediately get funding after. Bump Technologies is no exception. The company behind the Bump application has received funding from Sequoia Capital according to TechCrunch. Jason Kincaid discovered that Bump’s logo was on Sequoia’s PowerPoint presentation slides at the StartupSchool event.
The funding is rumored to be about $3 million based on a $10 million valuation. The Bump app is free on iTunes making the valuation sound pretty interesting. Bump allows people to transfer contact information simply by bumping two iPhones together. Bump launched out of Y-Combinator. Bump Technologies was founded by David Lieb, Andy Huibers, and Jake Mintz in October 2008.
In the frequently asked questions portion of Bump’s website, the founders revealed how the app works which I found pretty interesting. Below is that excerpt:
There are two parts to BumpTM: the app running on your device and a smart matching algorithm running on our servers in the cloud. The app on your phone uses the phone’s sensors to literally “feel” the bump, and it sends that info up to the cloud. The matching algorithm listens to the bumps from phones around the world and pairs up phones that felt the same bump. Then we just route the contact information between the two phones in each pair.
DailyBooth is a real-time photo blogging website that launched out of Y-Combinator. The website launched this past August and has been receiving a good amount of traffic ever since. Now the company has raised $1 million from investors such as Sequoia Capital, SV Angel (Ron Conway), Betaworks, Kevin Rose, and Caterina Fake (Flickr founder). DailyBooth was co-founded by Ryan Amos and Jon Wheatley.
The service encourages users to send messages along with webcam photos. DailyBooth receives about 6 million monthly visitors and a majority of their visitors are 15-25 year old women. The company said that they plan to use the funding for developing a premium offering and photo-printing distribution platform. Below is a screenshot of the service.
Micro-payment service Tipjoy attempted to sell itself, but it turns out that they will be shutting down instead. Facebook even offered Tipjoy $5 million in stock. Facebook walked away from the deal and Tipjoy shut down shortly after.
Even though Tipjoy decided to shut down, Facebook was able to hire one of the company’s executives. Facebook hired Tipjoy co-founder and CTO Ivan Kirigin. Although it is uncertain about what Kirigin will be working on, it is expected to be something related to Facebook Payments.
The reason why Tipjoy shut down was because Kirigan was not around after Facebook made him an offer. PayPal and Twitter were both interested in buying out Tipjoy too. Y-Combinator, Chris Sacca, The Accelerator Group, and Betaworks invested over $1 million in funding.
Scribd, also known as the “YouTube of documents” that spun out of Y-Combinator is developing an e-commerce platform. Scribd is doing this out of response to the irritation that some publishers have in discovering that their books have leaked in e-book format on Scribd.
Anyone can upload a PDF of Word document with almost no limits to Scribd. You could have a 500 page book in Word document form and Scribd would still accept it as an upload. Given the popularity of the Kindle and seeing that people are willing to pay for e-books, the e-commerce model makes sense to the company.
In this case the publishers will determine what prices they want to set for their e-books and let them keep 80% of what is earned. The prices would even range from $1 for a simple novel to $5,000 for an in-depth market research report according to paidContent.
Scribd would introduce a store and will maintain a copyright database of protected works to ensure that no further leaks or pirated works hit the service.
The primary difference between the Kindle and Scribd’s new model is the novelty. The Kindle is the epitome of physical books becoming obsolete. Download a full PDF on your computer does not seem to have as much appeal as the Kindle. But that is just my opinion. What is yours? Leave a comment.
For those of you that own an iPhone and don’t like the fact that the e-mail function doesn’t have built-in search, a company called ReMail has fixed that issue by creating an application. ReMail started from the Y-Combinator incubation firm started by Paul Graham.
Currently the application is in Beta and is for free. While Apple’s iPhone Update 3.0 is expected to have a mail search feature built-in, it will not be as advanced as ReMail’s application. The iPhone will be able to search for keywords in the subject line of e-mails but not the body of the e-mails.
ReMail has a server that is optimized for e-mail search on the iPhone and offers suggestions as you type. For the most part you have to be connected to the Internet to use the search feature, but the application also has a caching system to pull messages stored from the last two weeks.
Gabor Cselle is the founder of ReMail. Gabor has done work on GMail and Xobni in the past. Recently he completed a Master’s thesis titled Organizing Email. FriendFeed co-founders Paul Buchheit and Sanjeev Singh have also invested in ReMail.
The biggest drawback of ReMail is that they pull your e-mail and store it on their servers using IMAP. They do this to optimize rapid search. However messages are encrypted for your privacy and the company vows never to access or read any e-mails unless there is written permission by a larger authority.
The ReMail application is presently available for free when in Beta mode but after that there will be a $3.99 per month charge.
Yesterday night, it was announed that Facebook would be opening up a new set of APIs to build an ecosystem of applications around profiles and the user homepage. Xobni, the plugin made around Microsoft Outlook is one of the first companies to jump on board with the new set of APIs. In the sidebar of Mirosoft Outlook, Xobni will display links, pictures, status messages, contact info, and current position listed on LinkedIn.
Xobni will also show recent wall posts made of the contact’s Facebook profile and will give you the option to comment or “Like” the data listed. Xobni users won’t have to upgrade software because all the changes run from the servers. Xobni is only available on Windows machines so Mac users won’t have the benefit of the new application.
Xobni is based in San Francisco and expects to have the new application launched by around 6PM Pacific Time. Xobni has over $14 million in funding and started out as a Y-Combinator company.
Xobni is an e-mail plugin that gives Microsoft Outlook more social features and has a better search for the system. The company is exiting out of beta and has raised a second round of funding. The company raised $10.5 million in funding from Cisco ($5 million) and the BlackBerry Partner Fund ($3.2 million). All of Xobni’s previous investors also participated.
Xobni is currently developing a software update that focuses on performance and compatibility. The software will have caching and performance tweaks so that Outlook’s speed is not affected by message switching. The software update will also make the software compatible with other Microsoft products such as Dynamic CRM and Outlook Business Contact Manager.
Xobni still has yet to break even and profit. However the company plans on announcing a premium product this summer and paid online services. Xobni is a Y-Combinator company.
Scribd is a document sharing website that has about 50 million monthly users and has about 50,000 documents uploaded daily. The company was rolled out of Y-Combinator and eventually raised funding from Redpoint Ventures, Charles River Ventures, and The Kinsley Hills Group. It was recently announced that Scribd signed an agreement with major publishing companies to host free e-books.
Through Scribd, users can upload PDFs, DOCs, and other text files. Scribd then presents the document in a web Flash format.
Scribd signed agreements with Random House, Simon & Schuster, and Workman Publishing Co. The terms of the agreement was undisclosed. Scribd will provide a variety of book material at no cost. This includes excerpts from books and even full books. Full novels without much of an audience will be the ones made free.
Paul Graham has made the VCs open their wallets once again. Y-Combinator has raised $2 million from Sequoia Capital and several other angel investors. Up until now, only Paul Graham, Robert Morris, Jessica Livingston, and Trevor Blackwell were the sole investors in Y-Combinator companies.
Through this round of funding, Y-Combinator will open a new investment arm. Y-Combinator will also be able to increase the number of companies that they invest in ever year. They wil go from about 40 companies per year to 60. Y-Combinator invests about $15,000 per startup. Before Y-Combinator invested about $5,000 for 6% equity in the company and provided startups with office space and other resources.
Some of the companies to come out of Y-Combinator include Snipd, heysan!, Weebly, Addmired, Justin.TV, Tipjoy, Songkick, Disqus, Dropbox, Anywhere.FM, Loopt, Scribd, Xobni, Reddit, and Omnisio.
Greg McAdoo of Sequoia led the investment. Some of the angels that joined in the investment include Ron Conway, Paul Buchheit, and Aydin Senkut.
Amit Chowdhry | November 5, 2008 | 7,886 views | Comments Categorized under Y-Combinator
Personal note: Welcome all Y-Combinator News and Digg users. This list is based on my opinions and observations on what I’m reading in the press and it is pretty subjective. I know I may have missed a couple of companies and if I did, please let me know in the comments without trolling. Maybe even leave your top 15 favorite Y-Combinator ideas-it’d make a good debate. I gathered a lot of the funding data via Crunchbase. I think every Y-Combinator company is amazing and don’t want to make any comparisons nor do I want to offend anyone. But these 15 companies seem to be good benchmarks to work with given the press that I’ve read about them.
Paul Graham created one of the most popular incubation companies called Y-Combinator. Y-Combinator offers financing, business networking opportunities, etc. Y-Combinator gives companies about $5,000 per startup and $5,000 per founder for companies that comprise of about 2-4 people. Y-Combinator gets about 2-10% equity in exchange and requires startup teams to relocate to Y-Combinators facilities in Cambridge, Mass. in the summer and Mountain View, Calif. in the winter.
Y-Combinator has seen it’s fair share of companies not doing well after receiving funding. But Y-Combinator has seen tremendous success with some of the companies that they have funded as well. And when I say tremendous success, I mean TREMENDOUS.
Below is a list of the top 15 companies I believe were the some of the most successful for Y-Combinator.
15. Snipd Funding:
1. $15,000 seed from Y-Combinator
Snipd.com is a way for users to literally cut pieces out of a website and share them on a widget using scissors. Users can cut out text, images, and video. The company opened it’s doors a few days ago and has been growing since they were in beta.
Snipd wants to monetize their idea by replacing the ShareThis and AddThis buttons that are currently on many mainstream sites. Then Snipd would provide analytics services to media companies about what type of content is hotter than others.
14. heysan! inc. Funding:
1. $20,000 seed from Y-Combinator
2. $855,000 seed from Khosla Ventures and Atomico Investments
Heysan.com is a mobile messaging service that allows users to IM each other over the phone using AIM, MSN, Yahoo!, ICQ, and Google Talk. There is no download required and it is a free service. Heysan is actively working on support for Facebook Chat and Myspace IM support.
The company was founded by Michael Ossareh and Marie Brattberg.
13. Weebly, Inc. Funding:
1. Unknown amount in seed from Y-Combinator
2. $650,000 seed from Baseline Ventures
Weebly.com is a company where users can create websites quickly. It is definetely more useful that GeoCities. The interface is utilizes AJAX and drag+drop technology. This month, Weebly announced that they have reached over 1 million users. And in May 2007, Weebly raised $650,000 in funding.
Weebly was founded by David Rusenko, Chris Fanini, and Dan Veltri.
12. Addmired, Inc. Funding:
1. Unknown amount in seed from Y-Combinator
Addmired is the parent company of AddHer.com. AddHer first asks the users to upload a picture of themselves. The second step is to create a widget and embed it on MySpace profiles or any other websites. The widget will display 2 random individuals selected from the uploaded photos and will ask the reader questions such as “Who Dresses Better?” or “Who’s the next generation prom queen?”
Addher creates a weekly video of a featured users and publishes it on their blog. The company was founded by Gabriel Leydon, Halbert Nakagawa, and Michael Sherrill. AddHer’s traffic has been shooting up since July 2008.
11. Justin.TV Funding:
1. $50,000 in seed from Y-Combinator, Paul Graham, Paul Buchheit, Aydin Senkut, Mike Maples, and Georges Harik
2. Unknown Series A amount from Alsop-Louie Partners
Justin.TV reached one million users since the company launched in May 2007. Justin.TV is one of the most famous live web video broadcasting companies on the Internet today. The company was started by Justin Kan, who wanted to broadcast his life 24 hours a day. It’s like The Truman Show.
One of Justin.TV’s biggest wins was getting the Jonas Brother to do a live video on their site around August 2007.
10. Tipjoy Funding:
1. Unknown seed from Y-Combinator
2. $1 million angel funding from Chris Sacca, Betaworks, and The Accelerator Group
Tipjoy.com allows bloggers to make money through donations. If users add the “Tip This” button to each blog post or a “Leave a Tip” banner somewhere, this allows a blog’s readers to pay for good content.
Best of all, Tipjoy gives 96% of the earnings to the blogger. The remaining money goes towards PayPal’s service fee of 2% and Tipjoy earns 2% from a service fee. Bloggers can cash out through an Amazon.com gift card or withdrawing their tips.
TipJoy was started by Abigail Kirigin and Ivan Kirigin.
Amit Chowdhry | October 17, 2008 | 420 views | Comments Categorized under Y-Combinator
The last time I mentioned a Paul Graham essay was when he wrote about why he thought “Microsoft Is Dead.” I disagreed with him big time on that essay, but his newest essay seems more aligned with my thoughts. Graham later clarified what he meant by his essay. His new essay focuses primarily why creating a startup in a bad company is a good idea. As the founder of a startup myself, I agree with him on this point.
“If we’ve learned one thing from funding so many startups, it’s that they succeed or fail based on the qualities of the founders,” stated Graham. “The economy has some effect, certainly, but as a predictor of success it’s rounding error compared to the founders.” Graham also pointed out that Microsoft and Apple started in the mid-70’s which was around the same time stagflation (inflation and unemployment increased to record levels) in the economy was taking place. Both of these companies thrived because they had two smart founders each.
Nothing good will come out of having one smart founder and one founder that has no role whether the economy is good or if it is bad.
“If you’re the right sort of person, you’ll win even in a bad economy. And if you’re not, a good economy won’t save you,” added Graham. “Someone who thinks ‘I better not start a startup now, because the economy is so bad’ is making the same mistake as the people who thought during the Bubble ‘all I have to do is start a startup, and I’ll be rich.’”
Spot on, Paul.
One of my biggest pet peeves is when someone blames the economy on their lack of an ability to get a job or to do something else that is meaningful. If you want something bad enough, go get it. If you want to build your own Internet start-up, don’t pay someone else to build it for you. Learn how to use Photoshop, code PHP, and learn how to set-up MySQL databases. If you are bad at programming, there are many other options for making money on the Internet.
If you sit there and blame the economy as justification for your lack of action, then you weren’t meant to move up in the world. It’s the weekend, go out and do something meaningful while you have the free time.
Hannes Hesse, Kevin Lim, and Yiming Liu believes that there those who start a tipping point when it comes to music should be rewarded. Let’s say that I buy a song that I think has a great beat on Popcuts.com before many others. I will get get a cut out of everyone else that pays to download it after.
Each song on Popcuts is about 99 cents. Those who spot the trends first will get additional Popcuts downloading credit. It’s like a music pyramid scheme. “We thought that by providing this extra incentive to buy a song
legally, namely, owning a stake in that song, would make it more
attractive to buy,” stated Hesse.
“It’s in this spirit that we’re thrilled to announce Google’s purchase of Omnisio, a small California-based startup that’s focused on making online video more useful and collaborative,”stated The YouTube Team.“The Omnisio team has tremendous technical expertise when it comes to advanced video tools and having this kind of talent at YouTube should help us further explore ways to enhance your YouTube experience.”
In order to enhance the user experience on YouTube, Google Inc. (NASDAQ:GOOG) is acquiring Omnisio. Omnisio is a Y-Combinator company that launched in May 2008. Google is rumored to be spending around $15 million to buy the company [TechCrunch]. Ominisio was founded by three Australian entrepreneurs: Ryan Junee, Julian Frumar, and Simon Ratner.
Through Omnisio, users can sync Slideshare slides with videos. Omnisio also has the ability for users to comment in embedded videos and mash up videos. Other Y-Combinator companies that were acquired includes Reddit and Auctomatic. This acquisition directly allows YouTube to make user video experience as good as Viddler.
Songkick is a website that does everything to help you find concerts. They can find concerts near you by having you entering your location. They can e-mail you alerts when concerts come up. They’ve got a plugin that helps you find concerts of the artists that you have in your iTunes, Winamp, iTunes, and Windows Media Player libraries.
“We’re always adding more listings because we want to make sure we have every single concert in existence—no matter how obscure the band or tiny the venue,” states the company’s About page. “We even index bands’ MySpace pages to make sure we have all their dates.”
Songkick is based in East London and was founded by Ian Hogarth, Pete Smith, and Michelle You. The investment was provided by several personal investors. One of the investors is Saul Klein, founding partner of The Accelerator Group. Y-Combinator provided Songkick with their initial funding.
