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Elon Musk’s Boring Co. raises $113 million to chase a pipe dream

Elon Musk’s tunneling startup The Boring Company has raised $113 million to fund its vision of the near/distant future of transportation, according to newly filed SEC docs first spotted by CNBC.

The startup, which is centered around the goal of creating underground tunnels, plays a central part in Musk’s integrated view of urban transportation that he hopes will shape how the public moves about in a quick and efficient way. Last month, Musk announced that the company would be adjusting its plans to prioritize pedestrian traffic over vehicles.

A major part of the company’s early efforts have been in fighting for permits and contracts with city governments. Though Musk has indicated that he hopes to use the company to alleviate the problems of LA traffic, the company is also currently actively engaged in working with cities across the U.S.

Today’s documents don’t offer much insight into the details of the round beyond the cash amount and the fact that there were 31 undisclosed participants in the equity funding. The company has gotten some press for its less than conventional “fundraising methods” so far, where it has sold pre-orders of branded hats and, yes, flamethrowers.


Utah’s Pluralsight unveils IPO filing

Pluralsight, the Utah-based education technology company, has revealed its IPO filing. 

Given the timing of the unveiling, the company is likely targeting a May public debut.

Its core business is online software development courses, helping people improve their skills in categories like IT, data and security. Businesses small and large pay Pluralsight to help train their employees. It also has offerings for individual subscribers.

In the filing, the company acknowledges that it is a competitive landscape, and names Cornerstone OnDemand, Udacity, Udemy, LinkedIn Learning as others in a comparable market. It also mentions General Assembly, which was recently acquired by Adecco for $413 million. 

This is the first glimpse we get at Pluralsight’s financials. For 2017, the company brought in $166.8 million in revenue, up from $131.8 million in 2016 and $108.4 million in 2015.

Losses are growing, however. This is partly due to a sizeable increase in sales and marketing expenditures. For 2017, the company lost $96.5 million. This is up from losses of $20.6 million in 2016 and $26.4 million in 2015.

Pluralsight has been around since 2004. Like many startups outside of the San Francisco Bay Area, the company bootstrapped its business and didn’t raise significant outside funding until 2013. Pluralsight previously raised nearly $200 million in financing.

The largest shareholder is Insight Venture Partners, which owned 46.1 percent of the shares prior to the IPO, an unusually high percentage. Co-founder and CEO Aaron Skonnard owned 13.4 percent and investment group ICONIQ owned 8.1 percent.

Morgan Stanley and J.P. Morgan served as lead underwriters. Wilson Sonsini and Goodwin Procter served as counsel.

Pluralsight plans to list on the Nasdaq under the ticker “PS.”

A provision in the JOBS Act from 2012 helped make it so that companies could file confidentially and then reveal financials and other business information just weeks before making public debuts. This helps companies avoid too much scrutiny in the months leading up to an IPO. There is also a quiet period in this time, meaning that companies are limited in what they can say publicly about their businesses.

Like most tech companies, Pluralsight chose to take advantage of this confidential filing provision. But it also announced that it filed, something that companies don’t usually do. Most choose to stay quiet about IPO plans until they make the filings public, unless reporters break the news first.

It was no surprise to those who have been following Utah’s tech scene that Pluralsight is planning to list on the stock market this year. The venture-backed “unicorn” has been a late-stage company for several years now, with a reported valuation of $1 billion as of 2014. 

After a slow first couple of months, there has been a flurry of tech IPO activity in recent weeks. DropboxSpotify and Zuora recently debuted. Pivotal, Smartsheet and Carbon Black are amongst the companies expected to list in the coming weeks.


Instead of stealing instruments, musicians turn to Splice

“The percentage of Top 40 music made with our platform blows my mind,” says Splice co-founder Steve Martocci. He tells me about some bedroom music producers who were “working at Olive Garden until they put sounds on Splice.” Soon they quit their jobs because they were earning enough from artists downloading those sounds to use in their songs. That led them to collaborate with famous DJ Zedd, resulting in the Billboard No. 12 hit “Starving.”

Splice has attracted $47 million in funding to power this all-new music economy. That might be a shock, considering Martocci estimates that 95 percent of digital instruments and sample packs are pirated because they’re often expensive with no try-before-you-buy option. Even Kanye West got caught stealing the trendy Serum digital synthesizer.

But Splice lets artists pay $7.99 per month to download up to 100 samples they can use royalty-free to create music. That’s cheaper than it costs to listen to music on Spotify. Splice then compensates artists based on how frequently their sounds are downloaded, and has already paid out over $7 million.

Splice Sounds is like an iTunes Store for samples

“We try to make more seats at the table in the music business,” says Martocci, who previously founded messaging app GroupMe, which sold to Skype for between $50 million and $80 million in 2011. “GroupMe was made to go to concerts with our friends. Music has always been my motivator, but code is my canvas. Artists come up to me and hug me because I’m changing the creative process.”

Splice co-founder Steve Martocci

But now he’s getting some big-name assistance, attracted by Splice’s success in the stubborn musician community and its $35 million Series B from December. Splice has just hired former Facebook product manager Matt Pakes as VP of product to lead core teams in New York, and former Secret co-founder Chrys Bader to build out a new squad in Los Angeles. [Disclosure: I knew both from before they moved out of the SF social scene.]

Splice now has 100 staffers, mostly hobbyist musicians themselves, but “I don’t think I have one San Francisco employee,” says Martocci. He wants his offices where the artists live. “Everyone has a genuine passion for music. It doesn’t feel like a tech company as much,” says Bader. Martocci apparently takes feedback well, which is different because “I’ve had some pretty fucking hard people to work with in the past…” Bader notes, likely referring to disagreements with his co-founder at Secret. “I have zero tolerance for bullshit at this point in my life and there’s zero bullshit on this team.”

While the Sounds marketplace has blown up recently, pushing Splice to 1.5 million users, the startup has a grander vision for software to eat instruments. That means creating the same kind of tools that help programmers code apps, but for musicians to compose songs. Splice Studio integrates with composition software like GarageBand, Logic and Ableton to offer cloud-synced version control.

This might sound nerdy, but it’s a lifesaver. Splice Studio automatically backs up the artist’s work-in-progress song after every single edit so they can always reverse changes and safely work with collaborators without having to nervously save manually and fret about keeping all the copies organized.

Splice saves every edit to a song-in-progress so you can experiment but always reverse changes

Since Splice’s staffers actually make music themselves rather than parachuting into a foreign space, they intimately understand the frustrations they’re trying to solve. Knowing income can be unpredictable, Splice lets musicians access plugins, software and instruments on a rent-to-own basis, where they can pause payment and resume later. That’s the kind of convenience that Bader says makes Splice “easier than piracy,” echoing Spotify director Sean Parker’s plan to beat bootleg MP3s with a simple streaming service. “I wanted to build something even Reddit couldn’t complain about,” Martocci laughs.

But where Splice goes next could address the biggest, most insidious barrier to creative output: writer’s block. Ask most modern musicians and they’ll tell you about their giant folders of unfinished songs. Getting from a melody rattling around in your head to a few tracks laid out in your preferred composition software is the easy part. Polishing those parts, ditching the unnecessary ones, finding the rights sounds and tying it all together into something listenable can be agonizingly difficult.

Creative Companion is Splice’s solution. Currently being built by Bader’s LA team, it’s a songwriting assistant that can suggest a next step and surface samples that fit well with those you’re already using. Martocci explains how Splice uses “cool machine learning stuff” to recommend “Hey, you should add a bass line. You should add some mastering.”

Splice just hired Chrys Bader, previously the co-founder of Secret

The question for Splice will be how many music producers out there are willing to pay. “There’s an upper bound. This is not a consumer product,” Bader admits. Citing internal research, he says there are 30 million music producers in the world. Many might not even know about Splice, “but at $8 a month, that’s not really breaking the bank. You might pay $200 for a plugin or $700 for Ableton. That’s insane. Musicians can’t afford that. Yet a musician friend tells me all the time ‘I’m broke, I’m broke…but I live or die by Splice.’”

Splice’s heavy-duty funding from Union Square Ventures, True Ventures and DFJ could also attract competition. It might awake the interest of big creative services corporations like Adobe, or more established music production tool companies like Native Instruments, which just launched a direct competitor called But Splice is digging in for a long fight, giving away Splice Studio to lure in users and commissioning exclusive sample packs from top creators. In that sense, Splice is almost like a record label.

“I want to see a world with more transcendent musical highs,” where “you have more music that’s ready for any moment,” Martocci opines. “If we build something that makes musicians lives better, that makes our lives better because a lot of us are musicians… what else is there in life?” Bader explains.

Computers democratized music-making, leading to a flood of amateurs sharing their content with the world. But all good democratizations necessitate layers of curation to sort through all the output, which social networks have become, and tools to let the most talented artists create what’s worth everyone’s attention.

Martocci concludes, “Software is a great instrument. One-third of the world tries to make music at some point. They’re not going to pick up guitars and recorders any more.” Whatever app they choose, Splice wants to keep them in the creative flow.