While the U.S. gave Huawei a 90-day reprieve, allowing American businesses to keep selling specific products to the Chinese firm, it also added more affiliates of the...Technologyread more
The attacks come after state and local ransomware attacks in New York, Louisiana, Maryland and Florida resulted in the loss of significant sums.Technologyread more
U.K. Prime Minister Boris Johnson told the EU that a Brexit deal can still be approved by U.K. lawmakers if Brussels agrees to scrapping the contentious Irish "backstop."read more
Baidu posted better-than-expected earnings for the June quarter, swinging back to profit and managing to stabilize its core ad business.Technologyread more
United States Steel Corp will temporarily lay off hundreds of workers at its Great Lakes facility in Michigan in coming weeks, according to a filing the steelmaker made with...US Marketsread more
While Hong Kong leader Carrie Lam painted a bleak picture of the city's economy, she expressed hope that dialogue with protesters could provide "a way out."China Politicsread more
China's pursuit of the Middle East may spur growth in the Islamic finance sector.World Economyread more
Twitter and Facebook have suspended accounts believed to be tied to a state-backed disinformation campaign originating from inside China.Technologyread more
U.S. President Donald Trump and his former White House communications director Anthony Scaramucci have had a public falling out recently.Politicsread more
The report comes as Trump in recent days has lashed out over media reports about growing recession fears.Politicsread more
Beijing will lower borrowing costs for companies, but that may not boost the economy as much as some hope.China Economyread more
Meditation start-up Calm was so successful during a chaotic and stressful 2017 that Apple recognized it as the app of the year.
"Well done, Calm," Apple said in December.
Now the San Francisco-based company, which to date has only raised $1.5 million in seed financing, is being rewarded by investors. Insight Venture Partners is leading a funding round that values Calm at about $250 million, according to sources familiar with the matter. The total funding will exceed $25 million, said the sources, who asked not to be named because the deal hasn't closed and won't be announced for a few weeks.
Founded in 2012 by Michael Acton Smith, who previously created video game company Mind Candy, and serial entrepreneur Alex Tew, Calm more than tripled its sales last year and was generating $40 million in annual revenue by the end of 2017, Acton Smith told CNBC in a December interview. That number has since jumped to $60 million, sources said.
Representatives from Calm and New York-based Insight declined to comment for this story.
The Calm app is free but the company charges $60 a year for subscriptions to the full library of meditation, music and sleep content. The paid offering includes audio programs like "7 days of sleep" and "21 days of calm" that guide users through daily 10- to 15-minute sessions for relieving stress and anxiety.
Acton Smith said in December that growth in 2017 was tied to everything from concerns around Syria and North Korea to the avocado crisis, with prices hitting record highs. Perhaps no single event was as important as the U.S. presidential election in November 2016, which Acton said was "one of the triggers" for growth last year.
"Donald Trump is not to everyone's taste and he makes some people angry and frustrated, " Acton Smith said in the interview. "Learning to be more mindful and relaxing and calming people has proved to be particularly popular this year."
While Calm isn't confirming details of the fundraising, the company put out a filing earlier this month indicating that it was raising $8 million. That was just a preliminary filing and the full round is much larger. Insight is known for making later-stage bets, a sign of how quickly Calm has grown.
As of three months ago, Calm had about 20 employees running what Acton Smith described as a very profitable digital business with grand ambitions to expand well beyond guided meditation and become a giant consumer brand. Physical world products like books, clothing, a Calm Hotel and perhaps a Calm Island someday are all part of the vision. He called Calm the "Nike of the mind."
The company already has a $30 sleep mist, "which users can spray on their pillow to aid sleep, while listening to a bedtime story specifically designed to accompany it," according to a press release from July. Acton Smith also published a book called "Calm" in 2016.
However, not all investors share Acton Smith's excitement for taking the brand out of the strictly digital realm. One venture capitalist, who asked not to be named, said he passed on investing in Calm because of the company's hopes to get into ancillary businesses like candles and books. That investor and one other who looked at the company both described Calm as a small team that's "minting money."
Calm has dealt with reticent investors in the past, so skepticism is nothing new. Acton Smith told CNBC in December that when the company was trying to raise money in its early days, investors balked because they said "meditation was too niche" and that "it was going to be a fad."
Now there are multiple venture-backed players in the market, including Headspace, which raised close to $37 million last year and had a valuation at the beginning of 2017 of an estimated $250 million, according to Forbes. Simple Habit, a Y Combinator-backed company, raised $2.5 million from firms including NEA and Foundation Capital and angel investors like Dropbox co-founder Drew Houston.
The space is getting more crowded by the day, with apps like Buddhify, Insight Timer and Digipill gaining traction.
Calm is currently ranked 50th among top grossing apps on iOS (one spot behind Dropbox), according to App Annie, while Headspace is ranked 116 and Simple Habit is at 386. Calm provides audio meditations, sleep stories and relaxing music that can be accessed early in the morning, during a work break, while traveling or before bed.
Jason Calacanis, one of Calm's seed investors along with Automattic founder Matt Mullenweg and Bebo co-founder Michael Birch, wrote in a LinkedIn post in 2014 that he put money in because "I believed this was a project that VCs wouldn't fund — at least not today" and "venture capitalists are scared of making a bet on something that's so far left of center." His case for backing Calm, in addition to the team, branding and early metrics, was that "mindful meditation is going to be as big – probably bigger – than Yoga."
Consumer subscriptions make for a difficult business — just ask any media business — and it will be a constant challenge for Calm to ensure that customers re-up annually (lifetime subscriptions cost $300). Acton Smith has seen firsthand how painful it can be when technology shifts and fads play out. His previous company, Mind Candy, created a screaming success a decade ago with kids video game Moshi Monsters, but was almost forced into bankruptcy last year after getting crushed in the move to mobile.
Acton Smith is still chairman of Mind Candy but isn't involved in the day-to-day operations.
Instead, he's trying to build a global brand in what he expects to be a multibillion-dollar business by helping people reduce their stress levels and improve their mental and physical health. He told The Guardian that one of his inspirations for starting the company was all the stress and sleep deprivation he experienced running Mind Candy.
In the interview with CNBC, he referred to calmness as "an incredibly valuable skill" that's been misunderstood in Western society. He said the tide is rapidly changing.
"It's flipped," he said. "It's almost strange if people don't meditate. It's something that celebrities do and executives and children and people in nursing homes."
Calm has also benefited from the growing popularity of audio-assisted devices like the Amazon Echo and Google Home. Virtual reality and other wearables are also potentially in its future. But Acton Smith said that when it comes to delivering content, the smartphone remains his primary focus.
"There's so little friction," he said. "We're big fans of simplicity."
-- CNBC's Josh Lipton and Christina Farr contributed to this report.