technorati with huge round

Filed in archive Venture Capital on August 24, 2004

Russell sends in Om Malik's report of the Technorati funding. You may expect a decent round but far from it:

"EXCLUSIVE: RSS feeds have become beloved apps for all bloggers. And now it is the Venture capitalists who are falling in love with "real simple syndication." I have learned exclusively that Technorati has/or is about to close its first round of funding. My sources indicate that it was a mega-round, about $6.5 million at a valuation of around $12 million for the company. Draper Fisher Jurvetson led the round. When I asked David Sifry, he declined to either confirm or deny the news. "I'm sorry, it is our policy not to comment on questions on funding," he wrote in an email. Next step, a quick email to Steve Jurvetson who confirmed that his fund led the round. "We did lead the first round and I think we are the largest investor," he wrote. Both parties declined to comment on valuation and total funding received."

50% for a VC in a first round is a lot. But still considering I'm the owner of Technorati such an offer is worth considering. Technorati has just a rather plain robot with a decent and simple website. Technorati has a lot of potential indeed but hardly a real business model. The revenues from RSS feeds hardly make up for maintenance costs...

However my congrats go David Sifry and all earlier investors :-)