Jeremy Levine

Wales announces that he is retiring the search engine, to focus on core Wikia activities and Wikianswers.

Diapers.com is renamed Quidsi, What if?, in Latin, and becomes the parent company. The baby products site retains the Diapers.com name.

Bessemer is the sole investor in the Series A round and supplies $13.3 million to the full-service e-commerce outsource company. Levine joins as a director.

Levine leaves the board as Bessemer exits via a $260 million sale to Sony. The company’s MusicID service how has a database of over 6 million CDs and 80 million tracks, which it uses to display song information on music app services such as Apple iTunes, Yahoo! Music Jukebox, and Winamp.

Levine’s investment for Bessemer in what looked like a risky venture begins paying off, as Lore and Bharara modify the high-volume, low-margin formula that failed for other e-retailers like Pets.com and Webvan. The company uses software that it wrote to analyze orders and select from among 25 different types of box to avoid U.P.S.’s oversize shipping charge, saving $2-$3 on a typical $100 order. It also places its two warehouses in zones where 45% of customers can get free overnight shipping. Lore:

When you’re shipping diapers, wipes and formula, after shipping costs are taken out, there’s really nothing left in the way of profits. But you add in shampoo, lotions, feeding bottles and those things come out with 35 to 50 percent gross margins.

This brings overall gross profit margins to about 13% compared with 4.6% in 2005.

The company says it is now profitable after layoffs, but Maiffret resigns as CTO to pursue other interests.

Baby bottles made out of non-polycarbonate plastic become hot sellers after plastic toy recalls and a National Institute of Health report on the hormone-mimicking properties of Bisphenol A. Lore is an early adopter, selling a brand of non-BPA baby bottles and planning to add more:

They became the best-seller right out of the gate

Diapers.com expects sales to more than double in 2007, growing 173% to more than $30 million. Revenues grew 340% in 2006 to $11 million. Lore:

Shoppers were making more than 200,000 keyword searches on diapers each month and we couldn’t believe there weren’t more retailers going after the business opportunity

Levine and Bessemer managing partner David Cowan lead an investment in the Series C funding round. Together with European Founders Fund, they provide a total of $12.8 million to join a roster that includes Sequoia Capital, Greylock Partners, and Josh Kopelman. Cowan:

As heavy users of LinkedIn for deal flow, due diligence and hiring, we have seen first-hand how profoundly LinkedIn promises to transform several service markets

The upcoming Series C funding round is rumored to value the company at $250 million valuation. LinkedIn expects to generate $45 million to $60 million in sales in 2007 and $100 million in 2008 – it has been profitable since March and employs 45 people.