Evernote Gets $50 Million in Funding

http://blog.evernote.com/2011/07/13/evernote-gets-50-million-in-funding-with-faq/

by sahillavingia • 15 years ago

49 43 15 years ago

blog.evernote.com

scottkduncan• 15 years ago

> Well, we don’t think a billion dollars is all that cool either.

Apparently some of the investors who are cashing out think a valuation south of a billion dollars is pretty cool.

edvinasbartkus• 15 years ago

They took money that they actually don't need? So it's like selling yourself?

jackowayed• 15 years ago

They don't need it now. But money is cheap right now, even cheaper if you don't need money (your company is doing great, plus you have leverage). This should help them avoid having to raise money when they desperately need it, which is a bad situation to be in

notatoad• 15 years ago

"What are you going to spend it on? Some of the money will go to long-term investors and shareholders. "

does this sound kind of pyramid-schemey to anybody else? they are taking new investments in order to pay off investors?

icey• 15 years ago

It just sounds like they're buying some early shares back to me.

jsherry• 15 years ago

You're defining a pyramid scheme too narrowly. This is one piece of a pyramid/ponzi scheme, but in those schemes, the underlying asset has no net worth. Here, Evernote clearly has worth, and plenty of it (regardless of whether the exact figure is debatable).

This happens quite often in Series B+ rounds, where previous investors take some or all money off the table. The reason is that early stage investors don't always have the tolerance/portfolio to sustain a long-term investment. Let's use DoCoMo Capital in this example since they were an investor in Evernote's Series A/B rounds. It appears that they didn't invest during this round, so it very well may be the case that they took some of all of their money off the table. It could very well be the case that DoCoMo Capital (who is the venture arm of NTT DoCoMo) made their initial investment in Evernote as a strategic one. Perhaps they no longer see strategic value in the company and need to cash out so they can make different investments that are a better strategic fit for their company. I don't know this to be the case at all - just showing the point.

Alternatively, let's say an angel investor with a very small portfolio had invested in Evernote in their very early stages. It could very well be the case today that 95%+ of that angel's net worth is tied up in the company, and so he/she might want to take some money off the table today to reduce his/her risk.

On the other hand, perhaps Sequoia has the tolerance to wait this out until IPO or a mega-acquisition. So they get in now at a higher price, cash some of the older investors out to reduce some dilution to current shareholders, and then the rest of the cash gets pumped back into the company.

Hopefully this is helpful.

petercooper2• 15 years ago

Not necessarily. There may just be a mismatch between the worth of the shares between different parties.

If I bought a house with a friend 10 years ago for $100k, we did some work on it, and it's now worth $200k, my friend may no longer wish to live with me or may want to move on to a different area and sell his share for twice what he paid for it. You could be in a similar situation with a business, perhaps.

nivertech• 15 years ago

“A billion dollars isn’t cool, you know what’s cool? A bazillion dollars.” -- Evernote

hnsmurf• 15 years ago

The exit section is a little silly. When you take $50m you don't just get to not exit later. You're just saying you're going to do it via an IPO or an IPO-sized acquisition.

If you really don't want to exit, don't take money at all. The minute you take a VC's funds you're agreeing to exit.

tlrobinson2• 15 years ago

From the context it seems they're specifically talking about acquisitions. IPO seems in line with their goals, including "making a hundred year company".

petercooper2• 15 years ago

I'm not an expert in this area so take this question as genuine and not an attempt at playing devil's advocate :-)

Couldn't a company take significant investment, remain private, and maintain its founders indefinitely? For example, the founders may not ever wish to leave but are OK to dilate the shares through investments. Investors can then make a return through either dividends over time or by selling their shares to other investors who place a higher value on the company. This assumes investors aren't just in it for a quick buck, of course, but are buying into what they think will be a profit making machine within a reasonable timescale.

grandalf• 15 years ago

Wow. Evernote is the kind of software that I wish I used, but for me it has a lot more friction than just using a text file in each project (which I can view on my phone and other computers via dropbox).

Any die-hard users want to share some info about the way you've benefitted from it compared to the sort of system I described above?

ry0ohki• 15 years ago

I feel the same way, I initially really liked Evernote on Desktop, but it's much more clunky then just using Notepad on my iPhone. Plus the notes don't work (well?) when you are without Internet or the Internet is bad like at SXSW.

thecabinet• 15 years ago

If what you want to use Evernote for can be done in Notepad, then you might not be the right audience. Or you might not be thinking big enough. I've been using Evernote since very early, and it took me awhile to get it, too.

I have a few differet use cases:

1. Keeping a copy of almost everything I read online. The search feature makes it easy to find stuff, and having a screenshot-like copy means I can tell when people try to disappear stuff. In my opinion, 95% of people using Pinboard and Delicious are doing it wrong; if you want to record where to find (highly dynamic) information then those are the right tools, but if it's information itself you want, why not just have a copy?

2. More general recordkeeping. The automated OCR means I can take a picture of a receipt and both (a) have it and (b) find it later when I need to be reimbursed. My family also moves far and frequently for work, and Evernote provides an extra place to store the kids' shot records, tax returns, etc. (You can make encrypted notes, or upload pre-encrypted files.)

And despite the fact that everything is in the cloud, a backup copy of your account is kept on your computer, so even if Evernote goes bust or loses your stuff, you've got a backup copy.

They also have great customer service. When my credit card number changed and my premium membership didn't get renewed, they just ave me a couple of months free while I got it sorted out. And it's $50/year ($4/mo) for a premium account! It's worth $4/mo just to be able to scan my records and then throw away te paper copies.

tlrobinson2• 15 years ago

I use Evernote, mostly for the automatic OCRing of scanned documents, but I'd rather just be storing the documents locally and/or in Dropbox.

Is there a good way to do this?

Ideally I'd also have a completely standalone document scanner that could sync my documents to Dropbox or something. Has anyone tried this one? http://www.ionaudio.com/products/details/docuscan-worldwide Any other suggestions?

nicksergeant• 15 years ago

Absolutely. I use a Fujitsu ScanSnap scanner[1], along with the software that comes with it. Automatically OCRs both sides and then stores it on disk. I don't even have to name files as they are full-text-searchable in Finder on OSX. Check out Ryan Waggoner's post[2] on this (where I got the idea from).

[1] http://www.amazon.com/gp/product/B001XWCQO2/ref=as_li_ss_tl?...

[2] http://ryanwaggoner.com/2010/11/how-i-filled-two-dumpsters-a...

foobarbazetc• 15 years ago

The Fujitsu ScanSnap is the greatest piece of hardware ever.

If you use OS X, you can also get DEVONthink (not free).

Way better than Evernote. Combine it with DropBox, and away you go.

avstraliitski7• 15 years ago

So you essentially Web2.0 a TODO text file, making s/CRLF/<arbitrary new record type>/ and let some other people view it, maybe ... add timestamping or version control or some other cruft, maybe a couple of mobile platform specific interfaces and/or an API (whole thing <1 weekend coding, add 2 weeks for UI/UX) ... somehow con fools in to using it, then someone gives you 50 million USD. This is why the US economy is going down the drain. Unbelievable.

sahillavingia2• 15 years ago

Are you serious? Please try and replicate Evernote in 3 weeks.

avstraliitski7• 15 years ago

Firstly, you originally posted this article so I can see that you are biased against cynical dismissal of the company. (I tend to feel that in openness you should have declared that in refuting my skeptical take on Evernote, but now I've done it for you.)

Secondly, it seems from your background that you are 18 and your self-identity is closely linked to programming 'apps' and the whole money-for-dotbubbleapp2.0 thang. I am happy for your (apparent?) success thus far, as you yourself spin it. However, I would suggest that you consider that perhaps you do not have enough perspective yet to understand that this whole thing is just a game... a very stupid game... and ultimately not necessarily producing anything at all that is meaningful or useful to humanity, the economy, the country, or your dog: despite big scary amounts of money being thrown around.

In answer to your question: I am serious. It appears to me that it is not untrue to say that nothing Evernote has done has actually been new or unique. All they've done is drawn a cloud around some stuff that existed before (I can hear the squeak of the whiteboard marker right now...), put some marketing dollars down and made some sexed-up UI's for a few device types. That's it.

Then got a bunch of money.

Of course, they probably wasted a lot more money doing it less efficiently ... and used a lot of stupid Silly-valley oldboy networks to get the cash ... and burned a lot of time. And maybe actually did produce something new along the way. But basically... nothing new. Skepticism is king.

TL;DR? That's sad because I can't them recommend that you try The Art of UNIX Programming or any tome on code generation. But I hope you do. Also, take a tip and don't aim for fame "One day I hope you won't need to look me up to find out who I am" (puh-lease!) ... we were all 18 once.

kyro• 15 years ago

Then spend 2 weekends coding and make something better.

avstraliitski7• 15 years ago

Why would you replicate something that already exists? That's what Evernote has done, with very minimal spin. It's pretty close to empty marketing crud.

A superior solution would be any version control client and regular files. I'm not intimately familiar with Evernote but I'd wager that there are at least ten major features of good version control systems that Evernote doesn't have. Features like decentralisation, transparency, open source, mature security model, mature fork and merge model, commit hooks, etc.

Failing that, even rsync would be a good solution for a single user. I'm sure it's probably more on-wire efficient than whatever system Evernote use.

adamtmca• 15 years ago

They are profitable and hiring people. How could they possibly be bad for the economy?

avstraliitski7• 15 years ago

In reality, economics is not about money.

If you produce resources or services of value, then the future is rosier because others will trade with you in exchange for access to those resources or services.

If you make some piece of software junk that's dismally easy to copy and do so based on speculative capital, particularly when it provides arguably zero unique value, then what you've done is wasted everyone's time... including that of your own workforce. See http://en.wikipedia.org/wiki/Evernote#Similar_products_and_s...

Unfortunately, this sort of thing is rife in the US.

Back to reality: I cannot conceive of China suddenly sending squillions of RMB to the US because someone figured out how to Web2.0 a TODO text file. Hence, skepticism on real economic value.

Hisoka2• 15 years ago

In the end, most web apps are just glorified CRUD interfaces. But glorified CRUD interfaces are still valuable businesses

avstraliitski7• 15 years ago

I agree. However, In my worldview, due to life being short one should eventually learn to think past value as presently defined by the US market, because the cracks in that particular form of economic rationalism have grown far too great to hide.

J. Krishnamurti: "It is no measure of health to be well adjusted to a profoundly sick society."

codedivine• 15 years ago

Have you ever tried using evernote? It is much more than text files and some of it is quite sophisticated, such as automatic approximate OCR of images.

The UI/UX/API/mobile and desktop apps/backends, all of which you dispatch off without thinking, are all non-trivial to get right. The fact that evernote doesn't have too much competition right now should tell you something.

avstraliitski7• 15 years ago

I am going to have to stop replying to these comments soon because they're not well thought out. But here's another response.

More than text files? Yes, there's some binary file support too. "Ooh"

OCR is not hard. They probably just use http://code.google.com/p/tesseract-ocr/

The fact that they don't have 'competition' proves nothing. Maybe nobody wants their 'product' because it's not useful. As others have commented even here, who've actually tried to "get it" multiple times, it's really not useful for a lot of people - they just don't see the point.

Maybe the lack of people copying their "product" is because it's just marketing fluff around a solution to a problem that doesn't exist (really, very much, for most people, apparently).

veidr3• 15 years ago

If you think you could create full-featured native apps for five different platforms plus the web UI and a synchronzing backend that can support millions of users in three weeks, I have a hunch you are overestimating your abilities.

spoiledtechie• 15 years ago

Two Gripes about Evernote.

Its soo difficult to suggest new features. I have looked a few times and still haven't found a way to do it.

Feature Request: I want to be able to mark a spot on a map for later. Like a way point and add information to it. Example: I found an awesome lake and I doubt Ill remember it 5 years down the road, but want to move there someday. Nothing in evernote allows me to just that. I want to take a note about a specific location.

edawerd• 15 years ago

Your wish is my command. I'm gonna integrate my Android app, Car Locator, with Evernote using their API. Check back with me in a couple days.

natural219• 15 years ago

I think this is great news. Evernote is a fantastic company, and I think they have a really good shot at changing the way normal people keep track of stuff in their head.

They definitely have a lot of areas to expand. I'd be happy if they used this money to focus on hardware; there are a zillion things you can do to bridge the awesomeness of digital recordkeeping with the constraints of our physical world. Have you seen the Sixth Sense that MIT Media Lab has been working on? (http://www.pranavmistry.com/projects/sixthsense/). Yeah -- I want that for Evernote.

joshklein• 15 years ago

I love Evernote with a passion, but only after I studied some in-depth how-to articles from other users, and built my own mental model of how to apply it to my way of working. I think Evernote needs to come with some pre-built paradigms or tutorials if it is going to get more mainstream traction.

edanm• 15 years ago

I've tried and failed to get the point of Evernote a few times.

Do you mind pointing to the article/articles you used to get you up to speed?

stcredzero3• 15 years ago

What makes OneNote so much better than Evernote?

EDIT: This is not an editorial comment or rhetorical. I've heard much about this, and would like to know why many consider OneNote on early 2000's pen computers so awesome and Evernote only so-so.

Evernote Gets $50 Million in Funding

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