Investment group Tech Coast Angels announced that members invested $13.5 million across 58 companies in 2015, a drop from the record $16.7 million the early-stage investors contributed the year before.
The organization regularly hears pitches from entrepreneurs, and then the 300 individual members may invest in the companies as they please. They focus on companies that are often less than a year old.
Part of the reason wealthy individual investors are being more cautious is because funding for older start-ups from venture capital firms has begun to recede from record levels. Because angels often earn their returns by taking a piece of later-stage investments, they're adopting a more conservative lending approach with young companies.
Last year’s Tech Coast Angels deals included virtual reality technology company Immersive Entertainment, gadget loan service LeaseVille and WeGoLook, which dispatches agents to attempt to verify offerings of online sellers.
New game. Pasadena-based mobile game developer Industrial Toys launched “Midnight Star: Renegade,” the start-up’s second game.
The new take on the shooting genre is set in a futuristic world with shorter matches and more tools than its predecessor.
Industrial Toys formed in 2012 with a goal of bringing hard-core games to smartphones, where casual games have dominated. The company hopes its more intense games will catch on because they're meant to be played in bursts of a couple of minutes throughout the day rather than in the long sittings Xbox, desktop or PlayStation games demand.
The original “Midnight Star,” which hasn't taken off, generated revenue by asking users to pay to save time. For example, a gun has limited charges and users could pay for a faster re-charge. Though the feature is a typical ploy in mobile games, it led to a tremendous slide in playtime, said Industrial Toys Chief Executive Tim Harris.
“Renegade” has a new sales strategy. It invites users to pay to own customized tools and characters, which aren’t required to “win” the game but can improve the experience.
Industrial Toys has raised more than $5 million from venture capitalists and has about 20 employees. A handful of them are working for a spinoff company, Gunslinger Studios, which has several investors. Gunslinger is developing a role-playing game centered on minute-or-faster fighting duels between friends, Harris said.
Losses. Demand Media fell to a $16.5 million adjusted net loss in 2015 from a $1.5 million profit in 2014, according to financial results released last week. The tumble is no surprise given Demand's moves to sharpen up eHow.com and other websites it owns by removing some ads and content. Revenue from the entertainment and how-to websites declined 44% in the fourth quarter, compared with the same period in 2014.
But overall sales declined only 20% in the fourth quarter because of a combined 29% leap in sales of artwork on Saatchi Art and of customized products on Society6. Saatchi did $12 million worth of transactions in 2015, and Society6 about $50 million.
The company also cut $10 million in costs last year through layoffs, office closures and asset sales.
Shares of Santa Monica-based Demand rose after the latest results were posted, though the gains evaporated throughout the week. Demand executives didn’t offer specific guidance about 2016 prospects, saying only that the company should be able to turn a profit unless opportunities emerge to invest the cash instead.
3-D printing flaw. UC Irvine cybersecurity researchers warned that smartphones and listening devices could pose a major security threat to 3-D printing labs.
The research team almost perfectly reproduced a key-shaped object after they recorded the sounds a 3-D printer had made originally generating the object. It turns out, the researchers said, 3-D printing nozzles emit unique noises every move they make. Hackers, thieves and others could capture and analyze the sounds, just like the researchers did, to reverse-engineer hardware designs, said Mohammad Al Faruque, director of UCI’s Advanced Integrated Cyber-Physical Systems Lab.
Faruque said future printers could include sound-jamming technology to counteract the vulnerability, and companies also could ban recording equipment in sensitive manufacturing areas.
The researchers' set-up used a Printrbot printer.
New funding. eSalon.com, a Culver City start-up that sells customized hair dyes, has raised $2 million in new funding, according to a regulatory filing. But the company declined to share details about the investors or what the cash will be used for.
Celebrity start-up. The rapper Chamillionaire, who was named an entrepreneur-in-residence at investment firm Upfront Ventures last year, is listed as the chief executive of X Empire Inc. on a recent regulatory filing under his given name Hakeem Seriki.
Santa Monica-based X Empire has raised just under $1.5 million and was seeking up to $1.5 million more, according to the filing. Research firm CB Insights first reported the information and noted that a trademark filing for X Empire suggests the company is developing an app for entertainers and officials to chat with the public.
Celebrity start-up No. 2. Clippers star Chris Paul has partnered with InnoVision Labs to launch a new app, Game Vision. It runs people through a series of games where they’re meant to tap objects as fast as possible, slowly developing quicker reactions. The training -- catered to athletes -- also addresses depth perception and contrast sensitivity, according to the Israeli company.
Elsewhere on the Web. Advertising tech company Outbrain has purchased Revee, a Los Angeles analytics software start-up, according to GeekTime.
Elder care service HomeHero is transitioning 1,200 contractors to employees, according to L.A. Business Journal.
A TechCrunch contributor shares the history of Boxfox, a Los Angeles start-up that sells curated gift boxes.
In case you missed it. Snapchat raised a big chunk of new cash, but it might be losing the upper hand in talks with other investors.
New start-up Comparably wants to tell you whether you're happy and paid enough at work.
A lot of jailbreaking enthusiasts have moved on from the iPhone, one of the issues that has helped bring on the big Apple-FBI debate.
Coming up. About a thousand people are expected at the Montgomery Summit at the Fairmont Miramar Hotel & Bungalows in Santa Monica on Tuesday and Wednesday. The technology conference attracts investors, entrepreneurs and consultants. Notable speakers include Cisco Executive Chairman John Chambers.
A new co-working space, Village Workspaces, plans to host a launch party Wednesday at its new space on the 11th floor of a West Los Angeles building.
Hyperloop bonus. I chatted with Hyperloop Technologies Inc. Chief Executive Rob Lloyd at the Times' California Conversation event last week. Below, he explains how a hyperloop to transport freight away from the docks makes sense for Los Angeles. You can also see him talk about what the hyperloop is, the difficulty of getting property to build it and how it's different from high-speed rail. The full interview is available here.
Chat with me on Twitter @peard33