(WSJ) The Daily Startup: EdTech Investments Set Record in Second Quarter
Investments in educational training, media and services, also known as edtech, grew to $367.4 million across 24 deals in the second quarter of 2015, a record for venture dollars flowing to the sector in a single quarter, according to Dow Jones VentureSource data, Lora Kolodny reports for VentureWire. Tory Patterson, an investor and board member of edtech companies, including LearnZillion,Newsela and MasteryConnect, says that startups in this field have a chance to unseat incumbents in a massive, for-profit business because of the introduction of broadband Internet, mobile and social technology in schools.
ALSO IN TODAY’S VENTUREWIRE:
GitHub raised $250 million from prominent Silicon Valley venture firms, the software developer networks said. The infusion raised its valuation to about $2 billion, according to sources familiar with the matter, and brought the San Francisco company’s total funding to $350 million.
Betting Twilio will continue to ride the enthusiasm mobile app developers have for its technology, Fidelity, T. Rowe Price and others have plowed $130 million into the San Francisco-based startup at a valuation just north of $1 billion.
Foresite Capital has closed its third fund in three years, raising $450 million for its largest vehicle yet aimed at growth-equity investments in biotechnology and other health-care markets.
Food-related businesses have gobbled up record amounts of venture capital in recent quarters and a $30 million Series A investment in Thrive Market marks the latest indication the sector shows no signs of losing pace.
(VentureWire is a daily newsletter with comprehensive analysis of all the investments, deals and personnel moves involving startups and their venture backers. For a two-week trial, visit http://on.wsj.com/DJPEVCNews, scroll to the bottom and click “try for free.”)
ELSEWHERE AROUND THE WEB:
Asia’s Startups Get Wake-Up Call. China’s stock-market turmoil has delivered a wake-up call to Asia’s tech startups, even as investor enthusiasm appears to remain strong for a wave of new companies coming up from the fast-growing region. Industry executives gathered in Hong Kong on Thursday for Converge, a technology conference co-hosted by The Wall Street Journal and F.ounders, said Chinese startups had seen little change in their ability to raise money, the WSJ’s Rick Carew reports.
Startups Scramble to Define Business Model. Hundreds of startups that rely on freelancers to clean houses, run errands, deliver food and ferry people are under siege,Greg Bensinger reports for the WSJ. Lawsuits are threatening to reclassify their contractors as employees, which could drive up labor costs an estimated 20% to 40%. That has put an investment chill over these startups and prompted some founders to switch their business models.
Mobile Internet Driving Valuations for Chinese Startups, Investor Says. Rising valuations for Chinese tech startups are being driven by new investors interested in mobile internet, a top venture capital said at the Converge technology conference in Hong Kong, Rick Carew writes for the WSJ. Neil Shen, founder and managing partner ofSequoia Capital China, said the growth of mobile internet gave some investors a feeling the “sky’s the limit.”
Angry Birds, the Sequel. After more than a dozen “Angry Birds” games, the feathered heroes are finally getting a sequel, the WSJ’s Sarah E. Needleman reports. Rovio Entertainment on Thursday is launching “Angry Birds 2,” which the closely held Finnish company bills as a true second act. The mobile game comes nearly six years and 13 offshoots after the first title in the popular franchise was released.