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Yahoo Acquires Bignoggins, A One-Man Fantasy Sports App Maker
Oh, you thought Yahoo was done with the whole acquire-everything-in-sight bit? Nope!
Yahoo has announced that they’ve acquired Bignoggins Productions, a one-man iPhone development shop which had previously built a handful of fairly popular Fantasy Sports mobile apps.
Up until today, Bignoggins’ had at least two apps in the store: Fantasy Monster ($5), and Draft Monster ($3). Both apps were built as all-in-one tools, meant to let Fantasy Sports nuts manage their pretend football/baseball/basketball/hockey teams across Yahoo, ESPN, and NFL’s competing services.
The bad news: as part of the acquisition, all of Bignoggins’ apps were immediately pulled from both the App Store and Google Play. The better news: in a blog post on his own site, Bignoggin’s founder (and sole full-timer) Jerry Shen says that the tech he’s built so far will soon be baked into Yahoo’s official Fantasy Products products.
The terms of the deal weren’t disclosed, but I’d bet that Shen probably made out alright in the end, here. His $5 app had thousands of reviews and had danced around the top of the App Store’s best selling Sports apps a few times — it was almost certainly selling well enough to keep it’s creator fed and happy. Not bad, for a company that never had to hire a second employee. To quote his personal site:
I’ve never hired any full time employees. As a result, I would talk to myself frequently about the direction of the company. After one particularly fiery argument I nearly fired myself but reconsidered once I realized I had no employees.
Oh, and he never took any outside investment:
I’ve never taken any outside funding. Not even from my mother. Unless you count raising me and paying for college. Ok I guess that counts. But other than that, 100% bootstrapped, baby!
Most importantly, Shen says this is what he’s always wanted: “I’ve been playing Yahoo! Fantasy since high school, and have wanted to work here since college, so this is really a dream come true for me.”
[Tangent: You know how some words start to look wrong after you've typed them a bunch of times? "Bignoggins" starts to look weird on about the second or third pass.]
Snapchat's Spiegel Admits Brown "Came Up With The Idea For Disappearing Picture Messages" In New Court Documents
If a picture is worth a thousand words, and a disappearing picture is worth $800 million, what’s an idea worth?
Reggie Brown filed a motion on Thursday in a California court to disqualify Evan Spiegel, Bobby Murphy, and Snapchat’s attorneys, Quinn Emanuel. The documents also show evidence that may support Brown’s claim that he is a co-founder of Snapchat.
In February, Brown sued Spiegel, Murphy, and Snapchat, claiming he co-founded the popular photo messaging app, which just raised $80 million at an $800 million pre-money valuation, and was forced out by Spiegel and Murphy.
Spiegel called the lawsuit “utterly devoid of merit” in February. Brown’s filing on Thursday included some of the evidence that had been found by Brown’s lawyers during the discovery stage.
Keep in mind that during this stage Snapchat can say very little publicly; so while these documents are interesting, remember that this is one side of the case, and we aren’t seeing Snapchat’s supporting documents. For example, a source told me in March that there is a paper trail of Brown being willing to take a smaller share of the company. As I wrote then,
“A source says Brown, an English major, acknowledged that he “had a little less to contribute but was still working on what he could do” and that there were emails about Spiegel and Murphy taking equal cuts that were larger than Brown’s. Spiegel majored in product design and Murphy studied mathematical and computational science.”
Here’s what Brown’s lawyers divulged in court documents this past Thursday, and what each piece really means:
“• Contrary to public statements made before the litigation, Defendant Spiegel admits that Plaintiff came up with the idea for disappearing pictures messages;”
This corroborates what sources told me in March regarding the founding of the company, and obviously is a blow to Snapchat’s public image, as Spiegel and Murphy had previously denied Brown’s claims and said the idea was solely theirs.
“• After Plaintiff invited Defendant Spiegel to work on this project, they together tried to recruit a coder/programmer. After being turned down by other fellow fraternity brothers, Plaintiff and Defendant Spiegel settled on Defendant Murphy as the project’s coder;”
While it’s sort of interesting that Murphy wasn’t Spiegel and Brown’s first choice for their coder, sources say he has done a great job leading the technical aspects of the application and company. Bouncing ideas off friends and being rejected by busy classmates is also commonplace.
“• On June 9, 2011, in a text message to Plaintiff, Defendant Spiegel referred to his father’ house, where Plaintiff and Defendants Spiegel and Murphy were living and working on the Application as “startuphou5” (which means “startup house”);
• On June 28, 2011, Defendant Murphy sent a mass email to his friends asking them to try the beta test version of the Application that he, Spiegel and Plaintiff have been working on, and signed the email as “Bobby, Evan, Reggie;”
• On July 1, 2011, Defendant Spiegel’s father (an attorney) sent a text message to Plaintiff’s mother, and acknowledged that the three of them were equal collaborators on the start-up: “thank you for your gracious note. It is delightful to have Reggie with us this summer as he, Evan and Bobby work on their startup. They are working hard, having fun and seem to be learning a lot […];”
“• On July 8, 2011, around the time the Application was launched on iTunes store, Defendant Murphy listed Plaintiff as the “CMO” (and Defendants Murphy and Spiegel as “CTO” and “CEO”, respectively) on Crunchbase, a database of tech companies;”
Nothing really new here–this is basic evidence showing that Brown worked with Spiegel and Murphy in the summer of 2011.
“• On July 17, 2011, the three of them took a picture together to celebrate the Application’s launch on iTunes store with a cake decorated with the start-up’s ghost logo (designed by Plaintiff). John Spiegel’s girlfriend emailed them the picture with the following note: “The launch of something great!!!;”
• On July 21, 2011, Defendant Murphy tagged Plaintiff as an “employer” for Picaboo Facebook;”
The cake picture has circulated all the blogs; nothing new here.
“• On July 23, 2011, several days after launching the Application, Defendant Spiegel texted Plaintiff to report on the increasing popularity of the Application and stated that “[t]his thing is a rocketship;”
• On July 27, 2011, Defendant Spiegel emailed a blogger about the Application, stating: “I just built an app with two friends of mine (certified bros our frat just got kicked off campus)”– referring to Plaintiff and Defendant Murphy;”
While Brown’s lawyers paint Spiegel as a mindless frat bro, the full email chain shows a much shrewder Spiegel managing the media and having a long-term vision for the product.
Sources told me Brown’s original idea for the app arose from a conversation about sexting; indeed, the blogger Nicole James immediately jumped to sexting when Spiegel pitched the idea to her.
“Ahh, okay. So it’s like, the best way to sext, basically. Cuz you can’t save the images?” James wrote.
“Some people use it for that..but it’s also the best way to quickly share an ephemeral moment with a friend - think celebs (blake lively?), cute guy on the street, where you are…it makes the images you send special the most exclusive photos in the world haha,” Spiegel replied.
“I like it,” she shot back.
“Blog target #1 acquired” Spiegel wrote to Murphy and Brown.
A few months later, in September, James wrote about the app on her Tumblr blog:
“My internet friend Evan [Spiegel] created this app called Picaboo whereby you can send a photo to anyone else who has the app, but you set a time limit on the photo, and it’s only from one to ten seconds. There is NO WAY for the person to save the photo. Imagine all the n00dz you’d get cuz people would feel so safe about it!!!!
Evan emailed me one day asking me to check out his app…
For Evan’s sake, as he’s probs reading this, I should mention he is not my sexting partner — he sends me photos of like, the beach and tacos and other stuff people do in California, while I send him photos of Times Square and taxis and a woman handing out coupons dressed up as a busted-ass Mickey Mouse getting cited by a cop (for real). You know, New York shit. Now we are photo friends! It’s neat.”
Even though James still thought the app was for sexting and pitched it to her readers as a sexting app, she herself was using it in the same way as most current Snapchat users: as a personal photo sharing tool, just as Spiegel envisioned.
“• On August 11, 2011, Plaintiff filed a provisional patent application for the Application listing him and Defendants Spiegel and Murphy as “co-inventors;”
• On August 11, 2011, Defendant Spiegel told Plaintiff the following after Plaintiff (who was visiting his family in South Carolina) suggested that Defendants Spiegel and Murphy celebrate the filing of a patent application: “No chance were celebrating wo you bro;”
• On August 16, 2011, the three of them had a blow-up on the phone when Defendant Spiegel got offended over the order of the names listed as co-inventors in the patent application (his name was listed last). After the call, Defendant Spiegel sent a text message to Plaintiff to apologize and acknowledge that Plaintiff came up with the idea for the Application: “I want to make sure you feel like you are given credit for the idea of disappearing messages…”
This also corroborates what sources told me in March–that a patent argument caused Spiegel and Murphy to shut Brown out of the company. However, the patent was not the one for single touch photo/press and hold video, which Spiegel and Murphy filed in August 2012.
The patent discussed here was much broader, essentially for an app for disappearing photos. A letter from Cooley LLP, representing Snapchat, to Brown in May 2012 alleges that Brown’s ownership claims were tied to this patent.
The letter explains that the patent was unlikely to be approved and that Snapchat was “confident that the subject matter of the application falls under ‘prior art.’” The letter cites a patent held by TigerText that covers the handling of impermanent message content, and argues that Brown’s contribution was the “unremarkable observation that impermanent transmitted messages would be desirable.”
In the Cooley letter, the firm argues that “unless and until a patent issues…your claim is to 1/3 of nothing.” The patent has not yet been approved, and has likely been removed by Spiegel, Murphy, or Brown. A representative from the United States Patent Office previously told me an “inventor can ask for an application not to be published at all until the patent is actually issued.” The patent is eventually abandoned if it is never issued, and if an application has multiple inventors, any of them can file a non-publication request.
“Of course, the Company has developed proprietary technical solutions for the handling of impermanent message content, but you had no role in developing such proprietary technical solutions,” the Cooley letter continues. “Accordingly, the Company is confident that you are not the owner of any Company intellectual property.”
Meanwhile, Brown’s lawyers are pushing for Brown to receive a full third of the company–not an equal share to Spiegel and Murphy.
“Our position is that it would not and should not be diluted because each subsequent investor knew or should have known about Reggie’s interest in the company,” James Lee tells me. “If we were to take this all the way to trial our position would be Reggie is entitled to the full 1/3…we would not be asking the jury for parity with what Evan and Bobby have today as a result of their improperly ousting Reggie.”
The two sides will meet in court on August 1 to address the motion to disqualify Snapchat’s lawyers.
Disclosure: I am currently a rising senior at Stanford and the president of the Stanford chapter of Kappa Sigma. Brown, Spiegel, and Murphy were all members of Kappa Sigma at some point during their time at Stanford. By the time I joined the fraternity, in the spring of 2011 (my freshman year), Murphy had graduated from Stanford, and Spiegel and Brown had left the fraternity.
I have never met Brown. I’ve met Murphy once. I have gotten to know Spiegel since the spring of 2012, mostly through interviews for TechCrunch. This in no way affects my objectivity or ability to report on this lawsuit or the company.
Greylock Adds Former Quora, Facebook And Twitter Alum Andy Johns As ‘Growth Strategist In Residence'
How to get customers for your product is a huge area of interest these days as we see the rise of the “growth hacker.” Venture capital firm Greylock Partners is making an interesting move today relating to this new focus, adding Andy Johns as a Growth Strategist in Residence.
Johns most recently worked at Quora where he led growth efforts, including email retention and more. He also worked in growth at Facebook, where he established SEO efforts at the social network, and he helped build a growth system at Twitter. According to Greylock, Johns has accelerate growth nearly 10x at each of the three companies, first creating the frameworks and data models to understand engagement and then coming up with programs based on those learnings.
Traditionally, the EIR role has been around bringing in successful executives and entrepreneurs in-house who need a place to hang out for a while as they figure out what their next company will be. Many times these execs will also advise and help the firm’s portfolio startups, as well. While the entrepreneur in residence role has existed for some time now, Greylock has been adding a different twist to this program over the past few years.
In 2011, Greylock brought on former LinkedIn Chief Scientist DJ Patil as a Data Scientist in Residence, which at the time was a new position for a VC firm to add. Having an expert in growth, especially one that has been part of some of the fastest-growing social networks of recent time, is yet another value-add for its startups.
Greylock principal Josh Elman, who worked with Johns at Twitter and Facebook, says that the firm’s philosophy on hiring EIRs has always been to bring in the best in their field who can spend time with the firm. “Andy is the expert on user growth,” he says.
As Greylock explains, creating growth and engagement for startups is even more challenging in this climate as there are so many dynamic distribution channels, including Facebook, Twitter, iOS, Android, Google+, Pinterest, address books, push notifications, email, SMS, and others. “In a world where users have an ever-increasing set of options, navigating all of these to build long-term durable systems for engagement has become increasingly challenging,” the firm says. “We decided that we wanted an in-house expert to help us and our companies with this on a full-time basis.”
In his role as Growth Strategist in Residence, Johns is going to help portfolio startups navigate these challenges and create durable user growth and engagement. He’ll work with startups on measuring and creating the right metrics and dashboards, developing new features and tests to increase growth and engagement, among other things. Elman says that people are realizing that using Facebook and Twitter can help grow user bases, but to sustain this growth and engagement is a separate challenge. Johns has been able to create network effects for a number of well-known (and fast-growing) companies.
It’s also worth noting that Greylock last week scored another talent win, adding Jerry Chen to the investment team covering enterprise.
Snapchat Founders Face New Twist In Legal Battle As Alleged Co-Founder Files To Disqualify Their Lawyers
Reggie Brown claims to have co-founded Snapchat, and in the latest twist to his suit against the company, he’s trying to disqualify its high-profile law firm.
Brown filed motions in a Los Angeles court on Thursday to disqualify the law firm of Quinn Emanuel Urquhart & Sullivan LLP (“Quinn Emanuel”) from representing Evan Spiegel, Bobby Murphy, and Snapchat Inc.
Brown alleges that he was advised by Anthony Alden, a Quinn Emanuel lawyer, on his case against Snapchat from November 2012 to January 2013. In April, Quinn Emanuel began defending Spiegel and Murphy after they replaced Cooley LLP for this case. Before Alden began representing Brown, Quinn Emanuel had Brown sign a waiver saying it did not represent him, but Brown says he and Alden did not limit their discussions, and he believed they were confidential communications between an attorney and client.
A representative from Cooley LLP said they could not comment for this story, as Cooley LLP is still Snapchat’s corporate counsel. Brown’s lawyers say Alden has not been one of the Quinn Emanuel attorneys representing Spiegel, Murphy, and Snapchat in the case, but that case precedent shows the entire firm should be disqualified.
“Mr. Brown signed a written contract saying Quinn Emanuel could represent the Snapchat defendants if we turned down his matter, provided the partner to whom he spoke was not involved in our representation of Snapchat,” Quinn Emanuel said in a company statement. “Mr. Alden has been ‘walled’ from the matter pursuant to that agreement. It’s disappointing that Mr. Brown is refusing to honor his clear written promise to our firm.”
Snapchat, the hot ephemeral messaging app, just raised $80 million at an $800 million pre-money valuation.
Brown filed a lawsuit in February 2013 alleging that he had come up with the idea for an app for self-deleting photos in the spring of 2011; he claimed that he worked with Spiegel and Murphy on the app, then called Pictaboo, until they forced him out of the company in August of 2011 following an argument over a patent filing.
“As you might imagine, seeing accusations in the media and not being able to share our side of the story is incredibly frustrating,” Snapchat said in a company statement. “Our team has spent the last two years working hard to make Snapchat what it is today. We will continue to focus our energy on building an awesome company and we believe the merits of the case will stand on their own in court.”
Until the case is resolved, Spiegel, Brown, and Snapchat can say very little publicly, so the advantage is heavily in Brown’s favor to try to win over the court of public favor.
According to the filing, Brown reached out to Spiegel and Murphy in mid-2012 to settle their dispute out of court. On May 16, 2012, Cooley LLP, Spiegel and Murphy’s representatives at the time, sent Brown a letter, calling his actions “a transparent and desperate attempt to shake down Mr. Spiegel and Mr. Murphy for a share in a company to which you contributed nothing.”
On November 2, 2012, Brown reached out to Alden seeking representation; Alden confirmed to Brown that Quinn Emanuel had no conflict of interest for the proposed lawsuit, and Brown signed a waiver from Alden that said, among other things, that Brown was not represented by Quinn Emanuel and that Quinn Emanuel could represent other parties down the line if they so chose. In the court filing Brown says Alden told him, “This was just ‘a precaution we need to take.’ Given these assurances, I just signed the document and did not ask any question about it.”
From November 2012 to January 2013, Brown and Alden discussed the strengths and weaknesses of Brown’s proposed case several times on the phone, and Brown sent Alden a USB and several emails with key documents for the suit.
“Mr. Alden and I did not limit our discussions in any way,” Brown claims in the motion. “Given the nature of our discussion and Mr. Alden’s assurances, I believed that our discussions were confidential communications by and between an attorney and his client.”
On December 12, 2012, Om Malik and Eric Eldon separately reported that Snapchat was raising a Series A round led by Benchmark Capital.
Brown writes in his motion,
“On or about December 12, 2012 I informed Mr. Alden that an article had been published indicating that Benchmark Capital was funding Snapchat. At no point did Mr. Alden (or anyone else at the firm for that matter) disclose to me that Benchmark Capital was a Quinn Emanuel client. Furthermore, at no point did anyone at Quinn Emanuel discuss with me any conflict, actual or potential concerning Quinn Emanuel’s representation of Snapchat, Inc., Toyopa Group LLC or Benchmark Capital.”
Brown’s attorneys write in their motion that Quinn Emanuel had a conflict at this time because Alden was counseling Brown, while Quinn Emanuel client Benchmark had invested in Snapchat, which would dilute Brown’s claimed ownership interest in Snapchat. Additionally, Quinn Emanuel listed Lightspeed Venture Partners, which provided Snapchat’s seed funding, as a potential defendant in the waiver that Brown signed.
On January 10, 2013, Brown says Alden sent him an email informing him that Quinn Emanuel would not represent him “at the current time. He says Alden never gave any reason for this decision. Alden then referred and introduced Brown to his current representatives, Lee Tran & Liang (LTL) on January 14.
On February 8, Snapchat announced it had raised a $13.5 million Series A round led by Benchmark Ventures, and on February 21, Brown filed his lawsuit. Spiegel, Murphy, Snapchat, and the Toyopa Group (one of Brown, Spiegel, and Murphy’s original names for their organization, before their Pictaboo app became Snapchat) retained Cooley LLP to represent them.
Brown, Spiegel, and Murphy had their respective depositions for the trial on April 5, 8, and 9. During Brown’s deposition, he confirmed that he had sought legal counsel from Alden and Quinn Emanuel.
On April 30 2013, Spiegel, Murphy, and Snapchat substituted Quinn Emanuel for Cooley LLP as their representation. Brown’s representatives, led by Luan Tran and James Lee, learned that Benchmark Capital is a Quinn Emanuel client, and asked for a one-week standstill of litigation; the two parties then underwent two unsuccessful mediation sessions and agreed to another standstill until June 20.
On June 27, after the parties agreed to another stay, Tran filed a motion stating that Alden “has an incurable and non-waivable conflict of interest,” and that Spiegel, Murphy, and Snapchat “attempt to gain an unfair tactical advantage by hiring the same law firm that Plaintiff [Brown] consulted with.”
Tran claims the waiver Brown signed is invalid due to its breadth and scope, and that Quinn Emanuel needed to have Brown sign a second waiver once a real conflict (Benchmark) emerged.
“In the end, no amount of spin can allow Defendants to hire a law firm to litigate against the same party that the law firm was just counseling on the same case,” Tran writes. “No court has tolerated this, and this Court should not be the first one to do so.”
Brown’s motion to disqualify will be heard in a Los Angeles Superior Court on August 1. Until then, neither side can litigate.
“Reggie [Brown] continues to look forward to litigating this case for his full one-third interest in the company,” Lee tells me.
Benchmark Capital and Cooley LLP declined to comment for this story. Lightspeed Capital did not respond to multiple requests for comment for this story.
Disclosure: I am currently a rising senior at Stanford and the president of the Stanford chapter of Kappa Sigma. Brown, Spiegel, and Murphy were all members of Kappa Sigma at some point during their time at Stanford. By the time I joined the fraternity, in the spring of 2011 (my freshman year), Murphy had graduated from Stanford, and Spiegel and Brown had left the fraternity.
I have never met Brown. I’ve met Murphy once. I have gotten to know Spiegel since the spring of 2012, mostly through interviews for TechCrunch. This in no way affects my objectivity or ability to report on this lawsuit or the company.
Snapchat: Motion to Disqualify
Snapchat: Luan Tran Declaration To Disqualify
Snapchat: Reggie Brown Declaration
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