Investing / Startups

Perceptual Networks raises $1M from PayPal, Youtube, Reddit cofounders

Cofounded by Jim Young, who rose to startup culture prominence with the 2001-era web sensation, and tech entrepreneur Cheyenne Ehrlich.

Launched by the cofounder of one of the web’s most famously bootstrapped viral hits, Perceptual Networks has lifted the veil somewhat on its model with the announcement this morning of a more than $1 million seed investment round from 20 mostly Silicon Valley A-listers.

They’re going to build web applications that will aim to help you find other people. It’s social discovery, we think, though the cofounders say they’re a couple weeks away from saying much more.

Visit their newly launched site here.

In addition to the round’s Silicon Valley contingent of PayPal cofounder Max Levchin, former Youtube CTO Steve Chen, Alex Ohanian, the man behind Reddit, and others, Northern Liberties-based Perceptual Networks also took money from Valley Forge-based angel investor Gabe Weinberg and newly University City-based First Round Capital (PN may also use desk space in FRC’s new offices).

Cofounded by Jim Young, who rose to startup culture prominence with the 2001-era web sensation that sold in early 2008 (though maybe not for $20 million), and longtime tech entrepreneur Cheyenne Ehrlich, Perceptual Networks seems to be aiming for the always coveted market of making connections for people.

This glitzy opening funding, which includes personal investment from Young, who moved three years ago from the Valley to Philly for his wife, and Ehrlich, who moved here in May for the venture, is quickly being trumpeted by the pair and their local investors as a leap forward for this city’s consumer web startup cred.

In their press materials, the PN teams says: “The company has a proprietary platform for developing consumer web applications that make it easier for people to “find their people.”

Cheyenne Ehrlich

Product announcements are looming, says Ehrlich, noting that the pair are actively seeking software engineers to supplement their small 5-person staff.

In 2009, Young relocated with his wife, a Northeast native and Central High School graduate, and they now live in Society Hill with their two daughters.

“I saw there were lots of great things happening in the tech community here, so I decided to stay and set up shop,” he said.

Jim Young

Young, a UC Berkeley alumnus who grew up in the San Francisco Bay Area, has already stepped somewhat into Philadelphia’s technology community. For example, he’s been a mentor for the Open Angel Forum from Weinberg, who has taken investment from Young for his search-engine-that-could DuckDuckGo.

Ehrlich, too, says he’s making a bet on Philadelphia.

“We started talking seriously about starting this company around the end of last summer. I had visited [Young] here several times over the last few years, and during our conversations we narrowed our focus to four markets: New York, the Bay area, Los Angeles and Philadelphia,” said Ehrlich, 41, who spent parts of his childhood in several states and recently moved to Rittenhouse. “We picked Philadelphia for a lot of reasons. There is great technical talent here. The quality of life is fantastic, and the cost of living is better than either New York or the Bay area. And we believe that this place has the factors necessary to really become a center of tech over the coming decade.”

For now, Young and Ehrlich are bringing West Coast dollars home with them to Philadelphia.

Here are some of the better known Web 2.0 stars joining the round, according to a list given to Technically Philly:

First Round Capital cofounder Josh Kopelman, who led the charge to bring his celebrated early stage investment firm’s headquarters to University City, is billing this as the first solid example of Philadelphia breaking into the national angel investment cool crowd.

“This shows that Philadelphia can attract great entrepreneurial talent,” Kopelman wrote to Technically Philly in an email.

[Full Disclosure: Technically Philly will be using office space in the new First Round Capital headquarters.]

Companies: Open Angel Forum / Perceptual Networks

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