Sequoia, Kleiner Perkins, And Obvious Put $4.5M In Sleek Social, Mobile Gifting Platform Karma
Karma, a new social, mobile gifting service from the founder of TapJoy, has raised funding from Kleiner Perkins, Sequoia Capital, The Obvious Corporation, Stephen Gillett, Felicis Ventures and other angel investors.
Context & Ripple Effects
Karma arrives about a year after Kleiner Perkins and Index Ventures put $8.5 million behind Path, another intimate mobile-sharing app, and the investor overlap is the real signal: the firm that launched its $250 million sFund for social applications at Facebook's Palo Alto headquarters in October 2010 is buying into consumer mobile again, this time alongside Sequoia, The Obvious Corporation, Stephen Gillett and Felicis.
The round also sits oddly against Sequoia's own stated posture — confirmed in March 2011 reporting that the firm was pursuing late-stage growth capital as part of an industry-wide shift away from super-angel-style seed investing. A $4.5 million check into a first-time-consumer-product spinout from the TapJoy founder reads as that strategy bending for a repeat founder with a distribution-friendly idea.
First-order effects
- Karma leaves stealth with roughly $4.5 million and an unusually heavyweight cap table — Sequoia, Kleiner Perkins, The Obvious Corporation and Felicis — before it has proven demand, giving it outsized credibility against other mobile gifting launches.
- TapJoy's founder is re-established in the market as a funded repeat entrepreneur, with operator-investor Gillett signaling the service targets mainstream consumers rather than developers.
Second-order effects
- Path and adjacent intimate-sharing apps face a newly capitalized competitor in mobile gifting, and with the same syndicate betting across the category the differentiation burden shifts entirely onto product execution.
- Smaller seed funds and super angels get squeezed further out of consumer-social deals when tier-one firms write checks this size this early — a squeeze Sequoia's own 2011 move up-market helped open.
Third-order effects
- If the pattern holds, early-stage consumer mobile splits into a barbell: mega-funds seeding marquee-founder products while also hoovering late-stage rounds, leaving mid-sized funds to fight over what remains — a structural consolidation already visible in 2011's shift away from super-angel investing.
The trend: Top-tier venture firms are making fast, overlapping early bets on consumer mobile-social products, treating each credible founder's app as an option on the post-Facebook wave of social usage.