TechCrunch Disrupt Champion Shaker Shakes Down Investors For $15 Million

TechCrunch Disrupt champion Shaker, an Israeli virtual world startup, has closed a $15 million round of financing. The round was led by Shervin Pishevar at Menlo Ventures. CrunchFund was already an investor in Shaker, and participated in this new round as well.

Other investors in this round include Eric Schmidt’s Innovation Endeavors, Troy Carter and Rami Beracha from Pitango.

Here’s the TechCrunch post about Shaker winning Disrupt last month, and here’s their launch post and demo video.

The company was founded in Israel but recently opened a San Francisco office, which will be the new company headquarters. Shaker was founded by Ofer Rundstein, Yonatan Maor and Gad Maor.

Pishevar has a serious crush on the company. I asked him to tell me why he invested, and how he first met the team. In his own gushing words:

I was blown away by talent of the Shaker team. I’ve been searching for many years for what only Shaker has accomplished. We at Menlo Ventures are excited to be leading this major investment in Shaker. Shaker is the human serendipity engine. Shaker is going to touch and transform human connection and entertainment worldwide.”

Mike, so here’s the crazy story of how I met them. I was working on scouting a Jedi Council retreat in Cabo. I met these amazing guys from Mexico at Summit Series who are were working on an entrepreneurs resort. I began mentoring one of them, Bear. He wanted to learn how to become an investor and VC in the future. My advice was to go forth and travel around the world scouting for amazing startups and bring it back. I didn’t expect to hear from him for months. Instead, a mere 3 weeks later he had traveled to Egypt and Israel, and I flew into Burning Man. He said, “Shervin, I listened to you! Thank you! And I found this amazing startup, Shaker. And they are flying into the Playa tonight and they are competing in Techcrunch Disrupt!” That night I met them and was very impressed with them and their vision. But with no connection I had to wait until the following Tuesday to get the demo at a Samovar in San Francisco. Within a minute, I knew what I saw was the future. I had been looking for this for years. Their product execution was nearly flawless. A very hard feat to accomplish given the vision. The next day I brought them in to meet the rest of the Menlo partners. They agreed and we were off! Meanwhile, while we tried to come to an agreement on an investment, Shaker won Disrupt! I actually got the term sheet done and signed from the streets of Haiti the following weekend while I was volunteering in Haiti for jp/hro! Hopefully, there will be karma in that and all of the serendipity that brought us together.

I am very excited that Shaker is my first major investment at Menlo! Go Shaker!

Why’d we invest? Like Airtime, Shaker addresses the difficulty in meeting new people on the Internet:

“We are trying to address the problem of what has happened the last 10 years of social media,” says Parker, who was also the founding President of Facebook. “Your social network has become more rigid and constraining.” Airtime, it seems, will be more about meeting new people. “Facebook is about identity, the people you already know,” says Parker. “It has little to do with people you don’t know.”

Shaker is a virtual world where you can meet new people using your Facebook identity (picture and basic information). It’s strangely addictive. And we’re very excited to be investors.

28 thoughts on “TechCrunch Disrupt Champion Shaker Shakes Down Investors For $15 Million

  1. Hunter Walk says:

    crunchfund + shervin = boom goes the dynamite. congrats guys & best of luck to Shaker team

  2. Ben Lang says:

    Israeli startup crushing it, yet again!

  3. Shaker was amazing but it only when it was full of startup folks. So I could see mutual friends, etc. I think the disrupt strategy showed it works but now many of those users have left they need to keep working on how they’ll get users.

  4. gld i got a couple of drinks here before it got expensive:)

  5. What separates Shaker from the many other attempts to have an interactive online hangout? What is new about the Shaker avatar besides its connection to Facebook? I was just reading an article about the average age of a Facebook gamer being 43 http://gigaom.com/2010/02/17/average-social-gamer-is-a-43-year-old-woman/

    I don’t think this is the market Shaker is trying to capture..

    • This also likely wasn’t the market Zynga was going after when they launched their first game (Texas Hold’em).

      Yet, Texas Hold’em still averages 30MM+ monthly users and I’d highly doubt most of them are 43-year-old women.

      Bottom line, if you make anything compelling enough, people will get involved, and you can reach an entirely different market segment — beyond what others in the space are reaching.

      Shaker is compelling based on the fact alone that different virtual environments prompt different user interactions…couple that with Facebook interaction/interests/etc and you have a really compelling concept.

    • kc and the sunshine band says:

      What seperates them from any of the other similar startups is the connections they had… now of course we’ll hear a lot of fanfare, no doubt fueled by the investors, to ensure that there is a return on investment while the peanut gallery starts clamouring for Shaker stock with valuations of six billion and proclamaitions of how it will kill Facebook and Google because avatars are the new social graph.

  6. Mike,

    I greatly admire Sean Parker, and look forward to seeing what they have in store for Airtime.

    However, don’t you see some level of irony in the development of Airplay?

    (To paraphrase Parker), for years he had been seeking a way to create an ‘authentic identity’ for individuals online. It was something he pursued with Plaxo, and [that] he presumably accomplished through Facebook and ‘connect’.

    In a way it comes across as if Airplay is almost a reversion back to the days before identity authentication? I guess it will depend on how they facilitate initial interactions between strangers though, won’t it?

  7. Greg Biggins says:

    Don’t blow up my Samovar spot, please.

  8. James Zhang says:

    Only can say: awesome.

    Mike, i still remember your comments about the team during their presentation: For Shaker, If….. Google+… Right away…..

  9. When was the last time you used Shaker, Michael?

  10. Shaker was a great product and demo at TCD. Its like Turntable.fm meets Facebook.

    But I’m not sold on it. There’s not enough to keep me coming back. It probably needs to have chatrooms/venues sorted by interest using your social graph by sports, cities, etc..

    If I was going to SF, I’d be keen to meet folks from SF on Shaker then meetup with them in real life.

    I wonder what are the metrics like post TCD?

  11. The value is in connecting people you don’t know…agreed. Not convinced a game like setting is the best way. Google circles makes more sense. It’s clean, funtional and efficient.

    • Robert Dewey says:

      I think gaming is the only way to go with this, at least for now. Gaming = winning = dopamine release = people coming back like cocaine addicts. Not sure people are getting that effect by “circling” someone.

      • When you classify contacts in circles that results in promotion or sales guiding and dictating the future of your life, your hooked. Social gaming is untapped for business and pleasure so im sure something is there. Lots of pivot room with 15m.

  12. I think you and Shervin are super sharp investors and more often than not I wouldn’t bet against you. But I think you’ve make a mistake with this one. Shaker is a toy that might be fun for 10 minutes if you troll, and as I know from a fully botched launch at my university last year: these guys are amazing at hype (which is how they won Disrupt and ostensibly your investment) and terrible at making an important product.

  13. Ginny Cain says:

    Human serendepity engine…really?

  14. Nicolas says:

    The concept behind Shaker sounds absolutely terrific and the guys working on it seem very good at creating a real hype around the product. Nonetheless, I believe that in order to generate more than just a “buzz” and bring a real “boom” in the world of social networking, they will need to be more focused and define a clearer purpose for this platform. More details and suggestions in my post: http://nicolasvovan.com/shaker-a-revolution-in-the-crowded-world-of-social-networks/

  15. Diamond Law says:

    I’m inclined to believe this will only be a company that Facebook will acquire probably at 5x-10x valuation. Being solely facebook centered is what will see this succeed and failed. Good investment Mike et. al!

  16. Shadowlayer says:

    How many products like this have we seen before?

    Lively didn’t go anywhere, so whats the point of funding this?

    Is not like they are already making money, proving they have fixed whatever issue this idea had

    Mike, I disappointed

  17. Anon Whatever says:

    Hmm. Looks like a massively boring waste of time. Bye bye $15 mil.

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  19. Zidders Roofurry says:

    Hey, wow. It’s second life, only….not as good. Good luck with that $15 million investment.

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