New Investment: Engagio

One of the most important things that we have built at FirstMark Capital is our platform and community.  It is an infrastructure that connects and empowers hundreds of employees across our portfolio companies and tens of thousands of people in the NYC ecosystem to world class content, relationships, customers and expertise.

Every journey has its start, and ours began shortly after we launched FirstMark Capital in 2008 and held our inaugural Marketing Summit.  The idea was simple: marketing was evolving rapidly, the channels through which customers and consumers engaged were changing, and those that moved to take advantage could build unfair scale ahead of others.  If we could get the best minds talking about leading technologies and their approaches, the entire portfolio could benefit.

One of the earliest speakers at our Marketing Summit was Jon Miller, the co-founder of Marketo, who evangelized a new way of thinking about customers, content, and marketing automation.  Jon and I stayed in touch over the years, becoming an advisor and friend to several of our portfolio companies.  Marketo, of course, went on to become a powerhouse in marketing automation and is a $1B+ public company today.

Fast forward 6 years and I’m delighted to announce that we are leading a $10MM Series A financing for Engagio, a new company created by Jon Miller and his co-founder Brian Babcock.  I have gotten to know Brian more recently, but he has a fantastic and very relevant background for what Engagio is doing from both the ad tech and big data worlds, having been an early engineer at successful companies like RocketFuel and Platfora.  Jon and Brian in fact worked together at Epiphany in the 90s, which was one of the early pioneers in the world of marketing software.

Engagio is at the start of its mission but is building a new software platform focused on Account Based Marketing.  Jon has written an entire post dedicated to the topic here.  Said simply, Engagio provides one place for B2B marketers to understand all the campaigns, touch points, and interactions a company has with a target customer and plan the optimal ways to engage them over time.

We are excited to be joined by many of Marketo’s prior investors, including Storm Ventures and Bruce Cleveland/Doug Pepper, alongside First Round Capital and Amplify.  Stay tuned for much, much more!

Alibaba vs Google & Amazon

Having felt like I was reading about a new investment every month from Alibaba, it got me thinking about how rapidly they are expanding their reach outside of China. While many have written about this recent frenzy, I had not seen anything comparing Alibaba’s investing activities in the US to that of Google and/or Amazon in China.  As the digital platforms move towards true global competition, I got curious about the data.

Thanks to the folks at CB Insights, I looked at the data of investments made in the US by Alibaba and in China by Google and Amazon as far back as the data went.

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By number of deals, Alibaba has a substantial lead, but by investment value (shown below), the difference becomes staggering.

The data is fairly stark.  If you look at the individual deals, Alibaba is investing in all the areas you would expect — mobile, gaming, ecommerce — and even some you would not, expanding their sphere of knowledge and influence as they chart their inevitable global push.  For Google and Amazon, is the difference deliberate and due to different strategic choices or is it because China remains a more difficult and protected environment to enter and invest?  If it’s the latter, does that put the leading US platforms at a structural disadvantage competing in the global stage? We are entering a new era of the digital Game of Thrones and this will be interesting to watch play out.

Some notes on the data:

1) Investment dollars reflects total round size, as a reasonable proxy for invested dollars, as well as acquisitions. Some deals did not have any announced round size and are included at $0.

2) This is solely focused on investments and does not include capital associated with local operations in country.

Thanks to my colleague David Rogg for assistance pulling this post together.

A Mighty Swing

News has now spread on Aereo’s filing for bankruptcy. While folks in venture generally don’t talk about their failures, this is one I’m exceptionally proud to talk about.

We are in the business of backing innovation and taking big swings. Companies that can be change agents for their industries. Aereo is the very definition of that. Long before Aereo stood in front of the Supreme Court of the United States, the Company ignited conversations about the future of television and its delivery at a time when these services remained fixed, bundled and costly.

Since Aereo’s launch and first victory, we’ve seen cable companies introduce “TV Everywhere” strategies, networks announce over the top mobile apps and unbundled streaming options, and even the FCC take dramatic steps to define OTT players alongside cable and satellite companies. Can Aereo take credit for all of it? Probably not. But I think it’s fair to say they accelerated many of those discussions and helped re-shape an industry perspective.

While that impact may not be found financially, it is felt in the hands of consumers everywhere. For that, we at FirstMark are exceptionally proud to have partnered on this journey with Chet Kanojia and his incredible team. And as I’ve said before, we’d do it again in a heart beat.

New Investment: ROLI

I am excited to announce our investment in ROLI, the inventor of the Seaboard.

The Seaboard is a beautiful redesign of one of the world’s most iconic instruments – the piano – for the modern digital world we live in.  It is the first in a line of digitally programmable, highly interactive, connected music products for ROLI that combine novel design aesthetics, proprietary touch interfaces, and powerful social elements.

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The degree of difficulty on executing a product like this is extraordinarily high.  It requires expertise in material design, fabrication, manufacturing, hardware, and software.  It has to satisfy the demands of the world’s leading artists, while incorporating social elements that appeal to the masses.  Getting to a shipping product was no small feat, and we believe ROLI is at the forefront of a transformation in the music creation, collaboration and consumption process.

We are delighted to partner with Roland Lamb, the founder/CEO of  ROLI, and welcome him to the FirstMark family!

New Investment: Gravie

Well, we foreshadowed we’d be doing more around the intersection of healthcare and technology.  On the heels of our BioDigital and Recombine announcements, I’m excited to publicly announce our newest investment in Gravie.

Gravie sits at the intersection of some profound changes in healthcare.  Consumers are becoming empowered (or forced) to take control of their healthcare decisions more than ever before.  Employers are struggling with the increasing cost curves in healthcare, and in many cases, as disinterested parties, are phasing out coverage.  Insurers and insurance remain incredibly complex to navigate and difficult for the lay person to understand, often times only figuring things out in their moment of greatest need.  And finally a regulatory backdrop that is forcing major change on the system in the form of the ACA (“Obamacare”). 

Gravie emerged to bring simplicity and transparency to this new world order.  An intelligent, easy to use platform to navigate all the complex decisions in terms people can understand and a single place to consolidate all the information around health in one’s lives.  Gravie also offers advocacy to consumers, acting as a voice for individuals and offering help when questions or problems arise.  In short, Gravie is one place to go for peace of mind around your family’s health. 

The company was founded by three fantastic entrepreneurs who have a long history together and in the space.  Abir Sen, Jill Prevost and Marek Ciolko all worked together at Bloom Health, a company they started to bring Private Exchanges to employers, and successfully acquired by Wellpoint.  Abir has also been part of the founding team at Definity (acquired by United) and Red Brick Health (pioneer of corporate health & wellness plans).

We seeded the company in the summer of 2013, and have witnessed swift execution on both product, launch and adoption.  We are delighted to announce the close of a $10.5MM Series A, in which we participated heavily.  We are quite excited to continue our partnership with the team at Gravie and welcome in Mo Kaushal and the Aberdare team!

New Investment: BioDigital

I am excited to announce one of our latest investments, BioDigital.  BioDigital is one of several investments we have made at the intersection of healthcare and technology.  I laid out our rationale at a high level here.

BioDigital is based in NYC and has built a powerful platform around 3D visualization and immersion of the human body.  Our short hand for BioDigital is “Google Earth for the human body”.  Their team sits at the intersection of 3D / CAD software, web technologies (HTML5/WebGL), human anatomy and physiology, bio mechanics and high scale back end infrastructure.  A rich, deep, powerful service made simply available via APIs.  If you want a wicked engineering challenge, apply here.

The team has been working on complex 3D human modeling for the last several years, but with the introduction of WebGL and HTML5, saw a profound opportunity to instantiate all of their models into a Web based platform called the Human.  In the brief period of time since launch, the company has surpassed over 1 million registrants.  Even more exciting to us was the breath of use cases for the product.   Frank Sculli, founder and CEO, details some of them here.

There will be a number of ways to access the Human.  Their web, mobile and tablet apps will appeal to the millions of consumers interested in learning what’s inside our body and how it works.  Consumer health sites will be able to easily use our widgets to offer much richer representations of health conditions that afflict us.  Search engines can embed physiology and conditions directly into rich snippets.  Content publishers can enrich the learning experiences for students across the globe.  Doctor offices and hospitals can use the Human as their front end UI, with patient records mapped to the Human’s ontology.  And more exciting are the ways we cannot think of via our APIs.

In addition, we also can’t predict the ways in which individual consumers will add to the platform  People will be able to append all sorts of information into the Human to improve it in a Wikipedia like model – MRIs, content, interactions, etc.  People will also be able to personalize the human to the things they care about and share them out to the people they love or groups they interact with.  It will be exciting to see how people engage with an experience that was never possible before.

We believe this will be a transformative project and we are at the very beginning.  We are delighted to partner with Frank Sculli, John Qualter, Aaron Oliker and the entire BioDigital team!  Frank’s announcement on the BioDigital blog is here.

Sun Rising in Healthcare?

One of the hardest things in venture is timing.  Pick the wrong time to disrupt a segment, and the result is a lot of optimism and lost investment dollars.  Pick the right time to disrupt and you can build a massive company in a short period of time. Ideas are rarely bad, they are often simply at the wrong time.

A few years ago, we decided that the time had come for innovative changes in education.  We followed that up with some very successful investments in companies like Lumosity, Knewton, Schoology, Straighterline, and others.  Our macro thesis was pretty simple.  First, it was an extremely large important market that hadn’t changed in a long time.  Second, the cost curves in education had increased in multiples of inflation for decades and began coming under significant scrutiny as a result of the 2008/2009 recession.  Third, the industry was supported by an array of subsidies and government regulations that was destined to change.  Fourth, technology and software had the ability to dramatically reduce cost and bring an innovative value proposition “over the top” directly to the end consumers – eliminating traditional intermediaries along the way.  The mix of market size, economic crisis, government changes, and technology created what we thought was the “right time”.

As we started observing other markets in a similar state of change, another one became obvious to us: healthcare.  The only thing you might care about more than education is health.  It’s a gigantic market.  The cost curves have been increasing at an unsustainable rate.  The government’s role is changing rapidly, and causing major shifts in who and how people pay.  Consumers are now starting to take a much more active role on the paying side of the equation and doctors are beginning to select new technologies to power their practices (“over the top”).  While different in specifics, the parallels to education are quite striking.

The exciting news is that we’ve already made a few bets in the area, and will be announcing some next week.  We believe this is a tremendous opportunity to transform the sector and have a profoundly positive impact on lives.  Stay tuned for more!