Updated at 3:02 with interview with Evernote CEO Phil Libin.
Note-taking service Evernote announced an $85 million round of funding from AGC Equity Partners and Valiant Capital today. Current investors T.Rowe Price Associates, Inc. also participated in the round.
Evernote explained in a blog post that 75 percent of the money comes in the form of secondary financing (pulled together through existing shareholders selling their stock) and the rest comes as primary funding.
“We want to give every investor, every employee multiple chances to sell and to buy. We don’t want there to be a single day exit event,” said Phil Libin, Evernote’s chief executive, in an interview with VentureBeat. “Why should there be an exit? … You can’t stay focused if you have an exit.”
Libin said that he’s bringing on investors he knows will be in it for the long haul, beyond an initial public offering, and says the decision to give his investors liquidity wasn’t because people were knocking down his door.
“We weren’t getting any pressure at all. This is more of a proactive move. No one came to me saying we want to sell,” said Libin.
The company also officially signaled its plans to hold an initial public offering, but said that this offering was structured to make that eventuality further away, rather than closer. But now is not the right time for Evernote, according to Libin, who says the market is too short-term focused for tech companies.
“It’s not a pleasant experience right now to be a public company,” said Libin, “There’s kind of an incompatibility between the public markets now and tech. Sometimes it feels like the public markets are thinking minutes ahead … I think that’s a problem.”
Evernote currently has 45 million users and is starting to focus more on mobile. AGC Equity Partners, which is branch of mobile-oriented m8 Capital, led the round.
Of course, the company is now turning back to product, which Libin says is the glue that holds everyone’s interest in keeping their shares together. He’s confident that his investors all love the product, and says he chose his investors similarly to how he chose his earlier investors like Sequoia Capital and DoCoMo: they all focus on the product.
“Most of the conversations I have with investors, they’re just telling me what they hate about the product,” said Libin, focusing on the fact that all of the investors actually use the product that much.
The company recently released a new version of Evernote for Mac, integrated Evernote with Livescribe smart pens, launched a partnership with notebook maker Moleskine, and launched a version of its Skitch image-annotation software for iOS. And it also introduced a new Evernote for businesses product, which includes the long desired sharing and collaboration tools.
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