Flipboard Has Filed To Raise Another $50M

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Flipboard’s 75 percent jump in the last six months has it clocking in at over 70 million monthly active users. And it looks like that is not the only recent bump for the startup: It appears to have quietly raised another $50 million in funding.

[Update: Flipboard has confirmed our story.]

We were first tipped off earlier this month that Flipboard had raised a new round. Now documents that the company filed in Delaware — dug up by Justin Byers of private market data provider VC Experts — provide more detail. (Flipboard did not respond to several requests for comment.)

On June 29, Flipboard authorized $50 million in a Series D, with stock priced at $2.2057 per share over 22,668,540 shares. This is an authorization to sell stock, but it appears that the money has already been raised. “This is new money. If this is filed, then the money should be there,” says Byers.

Flipboard may well raise more in its Series D. As a point of comparison, when we tracked down another fundraise via documents in Delaware — for Houzz in June 2014 — we were able to see $150 million raised. But when the round was finally officially announced in October of that year, it was for $165 million.

While a Series D will help Flipboard continue to develop its business as an independent entity, there has been a lingering presence of M&A over the company, too, which often goes hand-in-hand with fundraising. Companies that have reportedly talked to Flipboard for an acquisition include Google, Yahoo and Twitter.

Coincidentally, Flipboard co-founder and CEO Mike McCue used to be on the board of Twitter and has been mentioned as a possible candidate for the vacant CEO slot.

The June 29 documents do not detail a specific valuation but provide some hints at what the range might be. With 600,000,000 shares in total, on a fully diluted basis the valuation could be as high as $1.32 billion. But the valuation could also be flat compared to its last round, when Flipboard was valued at $800 million.

Flipboard’s Series D share price, according to the documents, is the same as its Series C shares. The Series C was for $100 million in total, covering about 45.3 million shares. Meanwhile, this Series D is $50 million, covering half as many shares. All of this, as Byers says, could point to a flat round in terms of valuation — not a great sign for a company.

Prior to this filing, Flipboard had raised just over $160 million. There are no new board members mentioned in the June 29 document, which could mean a round raised from previous investors.

Backers in its Series C included Rizvi Traverse ManagementGGV CapitalGoldman SachsIndex VenturesInsight Venture PartnersKleiner Perkins Caufield & Byers in its Series C. Prior to that, other investors in the company included Ashton KutcherComcast Interactive CapitalDustin MoskovitzPeter CherninJack DorseyPeter CurrieQuincy Smith and SV Angel.

Flip-flop

Flipboard has been through a lot of ups and downs as a business. While other competitors have been acquired or are pivoting away from consumer apps, Flipboard has emerged as the biggest of the independents.

But that distinction may not count for much in the bigger scheme of things. Flipboard faces stiff competition from large platforms like Facebook and Apple — whose Apple News product was roundly described as a Flipboard clone when it was revealed in June.

More generally, there are question marks over how to develop any news discovery product to make it appealing to the mass market — something which Flipboard would likely need to do to fuel an ad-based model. Or if it eschews scale, what’s the best route to develop a revenue-generating business based around a news junkie audience and Flipboard’s loyal users?

Some believe that apps like Flipboard’s are inherently challenged for growth and sustained use because these days a lot of our news discovery comes from places like social networks — not dedicated news apps.

McCue said last week that Flipboard’s app has been installed on some 300 million mobile devices. Considering that Flipboard has 70 million monthly active users, with a good amount of those coming after it launched on the web, it points to at least some challenges that the company has in getting people to use the product regularly on the platform for which it was originally intended.

In that vein, the company has been expanding the service over the years. One of the biggest changes has been moving from a simple social-based news recommender and aggregator to a platform where individuals and others can also create “magazines” around different themes.

Flipboard is also working on other initiatives to make it easier for big publishers and individuals to use the service to syndicate content. One work in progress, under the provisional name of Pipes, would involve making it easier to feed and update content in Flipboard magazines using RSS.

Featured Image: Bryce Durbin