An iPhone photo app called colour announced last night that it raised $41 million from Sequoia Capital and Bain Capital pre-launch.To use a favourite expression of Foursquare CEO Dennis Crowly, that’s banana town.
How could this have happened?
A VC you’ve heard of but doesn’t want us sharing his name for obvious reasons, has a purely speculative theory:
I just couldn’t grok why the best early stage investor [Sequoia] would put that crazy amount of money in a pre-launch company and moreover do it alongside one of the worst [Bain]. But then figured it out.
I have no facts at all about this but bet you Sequoia seeded it and then Bain came in at higher price and got them to agree to say they did it jointly. Basically Bain paid $40 million to look Like Sequoia’s peer and get Valley mojo they desperately need. No other way this could have happened.
Update: CNET’s Caroline McCarthy tweets at us: “Sounds like a good theory, except that a colour exec told me Sequoia’s $$ was nearly triple Bain’s.” So we’re back to: HOW DID THIS HAPPEN?