Genomic sequencing efforts are limited in developing countries, but scientists are mobilizing to help
— Read more on ScientificAmerican.com
This past year, three sheep in Canada have been wearing their kidneys on their sleeves. Or more aptly, in jackets on their fluffy backs.
These three sheep are part of an ongoing animal study run by the Buffalo, New York-based startup Qidni Labs, a company pursuing waterless and mobile blood purification systems. Qidni Labs was founded in 2014, has raised $1.5 million and is currently in the due diligence process leading up to another round of funding. Qidni Labs was also an award winner at the 2019 KidneyX Summit for developing an air removal system for a wearable renal therapy device.
The jackets are a prototype of Qidni’s mobile hemodialysis machine called Qidni/D. The idea behind Qidni/D is that it will be significantly smaller than a traditional hemodialysis setup and use fewer fluids, allowing patients to be more mobile.
“We see this device, and this technology, to be a bridge to a blood purification technology that allows the patients to be mobile, although we do not anticipate that to be the first product,” says Morteza Ahmadi, the founder and CEO of Qidni Labs.
Per the CDC, about one in seven people in the US have some type of chronic kidney disease. Over time, that could progress kidney failure, at which point it’s recommended that patients start dialysis or receive a transplant. That threshold is typically symptom based; people might experience weight loss, shortness of breath or an irregular pulse to name a few symptoms.
There are two major types of dialysis: hemodialysis or peritoneal dialysis. Hemodialysis passes blood through a filter and a liquid called dialysate, whereas peritoneal dialysis inserts fluid into the body, which absorbs toxins, then drains it out. Qidni/D is a hemodialysis machine that can fit into a sheep sized jacket, and uses its own cartridges and gel-based system to cut down on the amount of liquid needed to perform dialysis. (TechCrunch reviewed images of the device).
In an early animal trial – the results of which have not yet been published in a peer-reviewed journal – the device was able to reduce levels of urea in sheep’s blood at the threshold of an adequate dose of traditional dialysis. TechCrunch reviewed data from the study over Zoom.
These sheep had no functioning kidneys, and were hooked up to the machine for between four and eight and a half hours. Morteza adds that the data so far suggests that four hours of treatment should be sufficient to cleanse the sheep’s blood.
This is just one small animal study, so it’s hard to draw massive conclusions from it. It didn’t include an active control arm, for instance, and instead compared the amount of urea and electrolytes removed from the sheep’s blood to published standards from other studies on dialysis.
The study alone is far from enough to suggest that the technology is ready for market, but those within the company are taking it as a good sign that the design of Qidni’s mobile dialysis machine bears further testing.
“We can say that in this study, we could replace daily dialysis based on the data,” he says.
The team will continue to tweak the technology in more sheep-based studies this year, and is aiming to begin human trials in 2022. The overall goal is to file for FDA approval, provided that clinical studies can demonstrate safety and efficacy, by the second half of 2023.
The kidney treatment landscape is dominated by dialysis, which is an onerous treatment – despite the fact that a kidney transplant, in many cases, could relieve that burden.
At the moment, far more people with end stage renal disease are on dialysis than receive kidney transplants. The CDC estimates that 786,000 people in the US live with end stage renal failure, of which 71 percent are on dialysis and 29 percent have received transplants.
The kidney treatment landscape is also notable because it’s covered by Medicare, however, it remains expensive. Dialysis and transplants make up about seven percent of Medicare’s budget. Because of this complex landscape, startups have been pursuing alternatives like implantable kidneys.
Qidni’s current product is not an artificial kidney in that it could live forever in the body of a participant and replace a non-functional organ. Rather, it’s a more mobile take on dialysis. Qidni/D, the blood purification device, is the company’s main focus for the time being.
That said, Qidni/D does have some unique elements that may make it as “disruptive” as Morteza hopes it will be. Namely, its small size, and low water requirements.
During an average week of dialysis treatment, the average person is exposed to about 300 to 600 liters of water, per the CDC. Some of that water is used in the dialysate solution that helps to leach toxins out of the blood. Per Morteza, Qidni/D uses just one cup of water per treatment session, most of which is contained with the dialysate solution.
“In our understanding, this is probably one of the first times in the world that waterless technology is useful for blood purification over a long period of time in a large animal model,” he says.
Removing the liquid components of dialysis may streamline an already onerous process. Morteza, for one, hopes that this would make at-home dialysis more attainable (fewer stringent water safety requirements) and limit risks of infection (water-related infections sometimes occur during dialysis).
It’s also a small step towards creating an implantable kidney, which would, ideally, not require massive amounts of external fluid – though mobile dialysis remains Qidni’s current focus. The company’s upcoming round will be focused on testing their cartridge technology in small human trials.
“In this round of funding we would be raising $2.5 million, and that should take us to a point that we can test this technology in a small group of patients, connected to an existing dialysis machine using our own cartridges instead of existing dialysate,” he says.
It’s ultimately a step towards a machine that functions more like the organ it’s supposed to mimic, though the holy grail for patients is a solution that ends the need for dialysis in the first place.
deutsche-startups.de präsentiert heute wieder einmal einige junge Startups, die zuletzt, also in den vergangenen Wochen und Monaten an den Start gegangen sind, sowie Firmen, die zuletzt aus dem Stealth-Mode erwacht sind. Übrigens: Noch mehr neue Startups gibt es in unserem Newsletter Startup-Radar.
Arive aus München bringt das FastAF-Konzept nach Deutschland. Das Startup möchte Retailern mit Hilfe von Micro Fulfilment Centern und einer Marktplatz-App eine günstige Option für Lieferungen unter 60 Minuten anbieten. Dabei geht es gezielt nicht um Lebensmittel, sondern andere E-Commerce-Produkte.
Hinter Tornado verbirgt sich eine lokal-basierte Kommunikations-App. “Ein bisschen wie Twitter, ein wenig wie Instagram, mit dem Unterschied, dass die Posts von Usern aus deiner Umgebung sind”, schreibt Gründer Gabriele Negro, der zuvor schon kietsy, ein soziales Netzwerk für die Nachbarschaft, gegründet hat.
Die Jungfirma Field “hilft Unternehmen, die Komplexität digitaler Produktentwicklung und strategisches Alignment zu managen”. Das Motto dabei lautet: “Smart Maps für Produktteams”. Das Hamburger Startup wurde von Michael Schieben, Klaus-Peter Frahm und Marius Wilms gegründet.
Das Berliner Startup FutureBens, das von Jasper Huesgen gegründet wurde positioniert sich als “digitale Plattform für nachhaltige und zukunftsorientierte Mitarbeiterangebote zu reduzierten Preisen”. Die Jungfirma verspricht dabei “nachhaltige, gesunde Produkte zu attraktiven Preisen”.
Vamos, ein Projekt des Company Builders DDG, setzt auf ki-basierte Lösungen für die Medienbranche. Die Hessen schreiben zum Konzept: “Unser leistungsstarkes Framework aus KI-zentrierten Geschäftsanwendungen ermöglicht es Vamos.ai, Ihre Daten zu minen, zu analysieren und zu optimieren”.
MinQi aus München kümmert sich um das “Wohlbefinden am Arbeitsplatz”. Kurze Sessions und Trainings sollen dabei Helfen, die mentale und körperliche Gesundheit von Mitarbeiter:innen zu stärken. Die kurzen Einheiten sind dabei auf die Bedürfnisse des heutigen Berufsalltages abgestimmt.
Tipp: In unserem Newsletter Startup-Radar berichten wir einmal in der Woche über neue Startups. Alle Startups stellen wir in unserem kostenpflichtigen Newsletter kurz und knapp vor und bringen sie so auf den Radar der Startup-Szene. Jetzt unseren Newsletter Startup-Radar sofort abonnieren!
Startup-Jobs: Auf der Suche nach einer neuen Herausforderung? In der unserer Jobbörse findet Ihr Stellenanzeigen von Startups und Unternehmen.
Mental health startup Ksana Health has received $2 million in seed funding led by re:Mind Capital, the mental health VC arm of Christian Angermayer and Apeiron Investment Group. It’s a move informed by two trends: passive data collection, and a burgeoning mental health crisis in teens and young adults.
Ksana Health is an Oregon-based company founded two years ago by University of Oregon Professor Nicholas Allen, a clinical psychologist and director of the Center for Digital Mental Health. Ksana’s platforms focus on collecting data related to mental health, and transfer that data from user to healthcare practitioners through an app. It’s, in essence, a mobile therapy app with a highly detailed dashboard of patient information.
The company has twelve employees, and other investors in the round include WPSS Investments, Panoramic Ventures, the Telosity Fund, Palo Santo Venture Fund, and Able Partners.
So far, Ksana Health has one live product called the ‘Effortless Assessment Research System’ (EARS) which is designed for institutions conducting clinical research. Participants in clinical trials can download an app and opt-in to sharing data including movement, location (via GPS), keystrokes and patterns in written language content with the trial’s investigators (no specific messages are shared). The app’s connection also goes two ways: trial administrators can send out things like surveys to keep in touch with participants.
The EARS product, says Allen, has already generated about $900,000 in revenue based on usage in clinical trials, but this most recent round of funding is geared towards another product called Vira, aimed at consumers.
Vira will also passively collect data like exercise (via an accelerometer), screen time, keystrokes or location-based data via a smartphone or smart device. Screenshots from Vira’s dashboard also include sleep data, though that’s not specifically listed as a recorded variable on the company’s website at the moment. Instead of funneling that data to a clinical trial, the data will be accessible to a patient’s therapist.
The user would give a therapist a personalized code which allows them to access data collected on their phone. Then, a therapist might discuss those habits, and program behavioral nudges to pop up on a phone during the day, reminding the user to exercise, or wind down before bed.
“Basically what this system does is it allows some of the data that’s been collected by the way people use their cell phones in a day to day fashion [to be turned] into indicators of important health behaviors that we know are relevant to mental health – so things like sleep, physical activity, geographic mobility, mood, cognition, social connection,” Allen says.
Vira is a major force of forward momentum for Ksana Health. The company was also selected as part of the insurance company Anthem Inc.’s, Digital Incubator program. That inclusion allows Vira to be trialled within Beacon Health Options, a behavioral health company with 37 million members.
Vira has yet to launch, but the key audience, says Allen, is people 13 to 30 years old. Rates of mental health issues within this group have increased even before the pandemic.
In 2019, a study in Abnormal Psychology analyzing data from the National Survey on Drug Use and Health found that the rate of young adults (18 to 25) reporting signs of major depression jumped 63 percent (from 7.7 to 13.1 percent) between 2009 and 2017. Meanwhile, there was no significant increase in the percentage of older adults experiencing mental distress or depression in that study.
The answer Vira seems to offer is extremely detailed data on well-being that will be funneled to a therapist. Data collection in the mental health space isn’t unheard of – Some AI-based mental health chatbots do indeed analyze user conversations, but those conversations happen within the confines of an app. Vira, conversely, is capable of constantly collecting data on a variety of variables that are passively trackable by a phone, and have some bearing on mental health.
Critically, there are no clinical trials of Vira itself right now, but the concept of the app is based on research that verifies each one of its’ individual parts. For instance, there is evidence that language used on social media can predict mood disorders, and that lack of sleep (or in some cases, excessive sleep) is linked to anxiety and depression.
In some sense, Ksana Health is somewhat reminiscent of a cadre of software betting that improving mental health is partially a factor of increased vigilance of digital life, particularly among teens. A.I-based software like GoGuardian for instance, have been used in school to record students keystrokes or search histories, in an attempt to head off student suicides.
GoGuardian was used in Clark County district in Nevada, the fifth largest school district in the country, and flagged 3,100 potential signs of self-harm between June and October 2020.
Like GoGuardian, Ksana Health is also catalogs digital activity as an indicator of mental health (note the inclusion of key strokes and language patterns, not just health variables like exercise), but Ksana Health’s focus also appears to be less on flagging harmful behavior automatically, and more about providing an extremely detailed data dashboard to a human therapist.
“Our focus initially is to keep, for want of a better term, a human in the loop,” says Allen. Ksana Health also isn’t AI- based, so it may be harder to scale, but Allen sees this as a benefit, not a liability.
“That’s why we’re focused on embedding this within practitioners,” he says. “There’s obvious appeal to the scale of a fully automated solution, you know you can scale it up very quickly. But I think the problems with safety are very significant in those systems.”
This comprehensive array of data, but particularly the language component, says Jan Hardorp, a founding partner at re:Mind Capital, is one aspect that attracted the firm to Ksana Health. Hardorp will also have a seat on Ksana Health’s board.
“We believe that language is very strong and variable, and then combined with other sensors, is a very good technological basis in order to assess and predict mental mental state and depression,” he says.
The move fits within re:Mind’s somewhat unconventional approaches to mental health: Angermayer held a 22 percent stake in Compass Pathways, a company pursuing psychedelics as a fast-acting treatment for depression. That stake was worth about $316 million during the company’s September 2020 IPO. Angermayer’s other public investments span from cryptocurrencies to cannabis.
Hardorp says that overall, re:Mind’s activities are focused on one third novel treatments (like psychedelics), one third brain computer interfaces, and one third into technology. Ksana Health fits squarely in that third category.
Allen says the company is already planning clinical trials of the Vira program in addition to the pilot program with Beacon Health. But Hardorp notes that so far, the lack of clinical trials on Vira itself hasn’t given him pause. He takes the strength of the EARS platform as a signal that Ksana Health’s platform is viable in the real world.
“We’re quite confident that it’s really the same technology. The Vira product, if you want, is really a new front-end to existing technology and algorithms,” he says.
At the moment, the Vira platform isn’t commercially available, but Allen is anticipating a launch in the first quarter of 2022.
Canada made headlines during U.S. President Donald Trump’s administration for its efforts to lure STEM workers north. Trump is gone now, but Canada hasn’t stopped trying to recruit talent from its neighbor — and one of the hottest fronts in this talent war is biotech.
For generations of Canadian engineers, coders and researchers, Silicon Valley’s better salaries and weather were a siren call. But four years of Trump’s anti-immigration rhetoric, policy and visa restrictions gave Canadian tech companies and governments a competitive advantage.
After Trump took office in 2016, Canada’s federal government boosted the tech ecosystems of cities like Toronto, Montreal and Vancouver by creating a program to fast-track immigration. Canadian tech leaders climbed aboard with campaigns to tempt more workers north. In Quebec, the industry even persuaded Quebec’s notoriously immigration-shy provincial government to accept as many as 14% more newcomers.
The pandemic-driven exodus from Silicon Valley has sent large numbers of Canadian expatriates flocking home. The number of Canadians applying for the U.S. H-1B program has fallen dramatically, accelerating a decade-long trend.
Canadians have been broadly supportive of government spending to beat back COVID-19 and hasten the transition to a new economy.
Still, Canadian tech and political leaders remain concerned about the inbound flow of talent to key sectors like advanced manufacturing, clean tech and biotechnology. They’re pressing every button they can to chip away at long-held American advantages.
Much of the action is in biotech. COVID-19 has exposed Canada’s lack of vaccine manufacturing capacity, but the country has a vibrant biotech and life-sciences research sector, driven by an excellent university ecosystem and several thousand startup ventures doing cutting-edge research. Many of these firms have cashed in on the pandemic biotech investment boom, racking in a record amount of venture capital in 2020.
But while this influx has changed the funding landscape, many Canadian companies are still trying to reach scale. The Canadian tech ecosystem is full of talent but it hasn’t traditionally developed, recruited and retained enough of the senior people these firms need to develop into global powerhouses.
They don’t just need scientists — they need business leaders. A recent survey of Toronto-area hubs and ventures revealed that biomedical engineering, regenerative medicine and related firms are suffering significant shortages of senior executives, top managers and scientific specialists, who gravitate toward the better pay and opportunities of the U.S. industries.
At a recent summit of Canada’s Innovation Economy Council (IEC), which both our organizations belong to, industry leaders spoke of unfilled jobs in global regulatory affairs and business development, even chief medical officers. These are hybrid roles that require the kind of technical and business acumen forged from both academic training and progressive leadership roles in the workplace.
Canadian universities, hubs and venture-capital firms are reacting to this need by building specialized training institutes and programs. And scaling Canadian companies are trying to fill the gaps by using newly raised cash to recruit heavily in the U.S. and beyond, offering remote work and flexible work hours while striking partnerships and investigating untapped talent pools.
Against this backdrop, Canada’s federal government just delivered its first full budget in two years. It’s one of the most activist tech-spending plans the country has ever rolled out, showing how seriously the federal government is about building out advanced industries and creating STEM jobs at a time when global markets are moving away from the country’s traditional energy exports, natural resources and manufactured goods. The budget includes college research partnerships, hiring subsidies, grants, and support for incubators and hubs. Critically, there is also a $2.2 billion commitment for building a life-sciences talent pipeline.
Canadians have been broadly supportive of government spending to beat back COVID-19 and hasten the transition to a new economy. An IEC/Campaign Research poll conducted in early April found 3:1 public support for investments in postsecondary STEM education and similarly strong support for government investment in advanced manufacturing, including biotech. That’s just what it takes to compete with a neighbor 10 times your size.
It’s fair to say that Canada won’t drain the U.S. of all its research scientists and Big Pharma CEOs anytime soon. But with an influx of investment capital, a burgeoning tech ecosystem and a concerted policy effort to build, recruit and retain a self-sustaining talent ecosystem, it’s flying under the radar as a place the industry increasingly wants to be.
In other words, America, take note: Canada is actively working to attract your biotech talent.
Chaos and crisis are sisters, and none more so than when you dial for emergency help. A call to 911 in the United States and urgent numbers globally spins off a number of additional calls to emergency response teams, ambulances, hospitals and other actors who need to coordinate action to save your life. Theoretically, everyone should be working off the same data, but also theoretically, I should be able to eat ice cream without getting fat.
Israel-based Carbyne’s software platform coordinates these calls so that critical details — say, location or medical allergies — don’t get lost from the 911 call taker to the paramedic in the field.
Now, it’s taking a second scoop on its capital cone in the form of a $20 million new round, following a $25 million Series B that my colleague Ingrid Lunden reported on in January. The new funding was led by Global Medical Response, one of the world’s largest emergency medical providers who operates fleets of vehicles, trucks, helicopters and planes to get patients to hospital facilities expeditiously. GMR was founded in 2018 from a rollup of emergency services led by private equity giant KKR.
This new round was in the form of a convertible note that will convert into Carbyne’s next fundraise according to CEO and co-founder Amir Elichai. Also joining the round was Hanaco VC, Intercap VC, Elsted Capital and others. Elichai said that the round took about three weeks to fundraise and close, and was held to $20 million given the company’s earlier funding this year, which at the time we reported was “over $100 million” in valuation.
Carbyne and GMR have been partners since late 2020, and their ties are deepening. GMR COO Edward Van Horne will join Carbyne’s board of directors.
In addition to offering more advanced location services for emergency callers, Carbyne’s technology allows for callers to activate a video channel, giving emergency response personnel more live information about what’s happening. That’s critical in GMR’s business, where first responders need the most up-to-date information to increase their effectiveness.
“The ability to get smarter information, and to increase situational awareness to each case whatever it is, will give emergency medical services the ability to better triage and to make faster and smarter responses to events that occur within their jurisdiction,” Elichai explained. “So basically the entire ecosystem is becoming much more reliable and efficient, thanks to the Carbyne ecosystem that we’re putting together with GMR.”
My colleague wrote a great deep dive into the company in January, so read that for some background on the company’s founding and product and how it weathered the pandemic. A few more updates though in the past few months bear mentioning.
Elichai said that the company has doubled the recurring revenues of its business since the beginning of 2021, although wouldn’t provide those ever elusive absolute figures. The company has also expanded its employee base by 30% over the same period. Among the success stories is New Orleans, which is moving its emergency centers to Carbyne, as well as centers in Texas, Georgia and Florida. Elichai said that much of this transition was prompted by additional federal investment in 911 infrastructure appropriated in recent COVID-19 stimulus bills.
The company’s CTO and co-founder, Alex Dizengof, will move from Israel to the United States to start an R&D center.
Last week, the company announced a new “Ultra Emergency Network” that it is building with Israel Aerospace Industries that will allow phones to communicate emergency location information in post-disaster scenarios where commercial mobile services degrade or disappear entirely.
The company’s newest investment is in line with growing interest from venture capitalists in the disaster space, with more data, investments in communications infrastructure, and more dollars flowing into the space than ever before.
Andrea Campos has struggled with depression since she was 8 years old. Over the years, she’s tried all sorts of therapies — from behavioral to pharmacotherapy.
In 2017, when Campos was in her early 20s, she learned to program and created a system to help manage her mental health. It started as a personal project but as she talked to more people, Campos realized that many others might benefit from the system as well.
So, she then built an application to provide access to mental health tools to Spanish-speaking people and began testing it with a small group of people. At first, Campos herself was her own chatbot, texting with users who were tired of dealing with depression.
“During the month, I was pretending I was an app, and would send these people a list of activities they had to complete during the day, such as writing in a gratitude journal, and then asking them how those activities made them feel,” Campos recalls.
Her thinking was that sometimes with depression and anxiety comes “a lot of avoidance,” where people resist potential treatment out of fear.
The results from her small experiment were encouraging. So, Campos set out to conduct a bigger sample of experiments, and raised about $10,000 via crowdfunding campaign. With that money, she hired a developer to build a chatbot for her app, which was mostly being used via Facebook Messenger.
Then an earthquake hit Mexico City and that developer lost everything — including his home and computer — and had to relocate.
“I was left with nothing,” Campos says. But that developer introduced her to another, who disappeared with his payment, and again, left Campos, “with nothing.”
“I realized at the beginning of 2019, I was going to have to do this by myself,” Campos said. So she used a site that she described as a “Wix for chatbots,” and created one herself.
After experimenting with the app with a sample of 700 people, Campos was even more encouraged and raised an angel round of funding for Yana, the startup behind her app. (Yana is an acronym for “You Are Not Alone.”) By early 2020, with just three months of runway left, she pivoted to create an app with chatbot integration that wasn’t just limited to use via Facebook Messenger.
Campos ended up launching the app more broadly during the same week that her city in Mexico went into quarantine.
At first, she said, she saw “normal, steady growth.” But then on Oct. 10, 2020, Apple’s App Store highlighted Yana for International Mental Health Day, and the response was overwhelming.
“It was also my birthday so I was at a spa in a nearby town, relaxing, when I started hearing my cell phone go crazy,” Campos recalls. “Everything went nuts. I had to go back to Mexico City because our servers were exploding since they were not used to having that kind of volume.”
As a result of that exposure, Yana went from having around 80,000 users to reaching 1 million users two weeks later. Soon after that, Google highlighted the app as one of best for personal growth in 2020, and that too led to another spike in users. Today, Yana is about to hit the 5 million-user mark and is also announcing it has raised $1.5 million in funding led by Mexico’s ALLVP, which has also invested in the likes of Cornershop, Flink and Nuvocargo.
When the pandemic hit last year, six of Yana’s 9-person team decided to quarantine together in a “startup house” in Cancun to focus on building the company. Earlier this year, the company had raised $315,000 from investors such as 500 Startups, Magma and Hustle Fund. The company had pitched ALLVP, who was intrigued but wanted to wait until it could write a bigger check.
That time is now, and Yana is now among the top three downloaded apps in Mexico and 12 countries including Spain, Chile, Ecuador and Venezuela.
With its new capital, Yana is planning to “move away from the depression/anxiety narrative,” according to Campos.
“We want to compete in the wellness space,” she told TechCrunch. “A lot of people were looking for us to deal with crises such as a breakup or a loss but then they didn’t always see a necessity to keep using Yana for longer than the crisis lasted.”
Some of those people would download the app again months later when hit with another crisis.
“We don’t want to be that app anymore,” Campos said. “We want to focus on whole wellness and mental health and transmit something that needs to be built every single day, just like we do with exercise.”
Moving forward, Yana aims to help people with their mental health not just during a crisis but with activities they can do on a daily basis, including a gratitude journal, a mood tracker and meditation — “things that prevent depression and anxiety,” Campos said.
“We want to be a vitamin for our soul, and keeping people mentally healthy on an ongoing basis,” she said. “We also want to include a community inside our application.”
ALLVP’s Federico Antoni is enthusiastic about the startup’s potential. He first met Campos when she was participating in an accelerator program in 2017 and then again recently.
The firm led Yana’s latest round because it “wanted to be on her team.”
“She [Campos] has turned into an amazing leader, and we realized her potential and strength,” he said. “Plus, Yana is an amazing product. When you download it, it’s almost like you can see a soul in there.”
Beauty and wellness businesses have come roaring back to life with the decline of Covid-19 restrictions, and a startup that’s built a platform that caters to the many needs of small enterprises in the industry today is announcing a big round of funding to grow with them.
Fresha — a multipurpose commerce tool for independent wellness and beauty businesses such as hair, nail and skin salons, yoga instructors and more, based first and foremost around a completely free platform for those businesses to schedule bookings from customers — has picked up $100 million.
Fresha plans to use the funds to expand the list of countries where it operates, to grow the categories of companies that use its services (mental health practitioners is one example; fitness is another), and to build more services complementing what it already provides, helping customers do their work by providing them with more insights and data about what they do already. It will also be making acquisitions to expand its customer base.
General Atlantic is leading this Series C, with Huda Kattan, Michael Zeisser of FMZ Ventures, and Jonathan Green of Lugard Road Capital also participating, along with past investors Partech, Target Global and FJ Labs.
Fresha has raised $132 million to date, and it’s not disclosing its valuation. But as a point of reference, when it closed its Series B (as Shedul; the company rebranded in February 2020), it was valued at $105 million.
Chances are that figure is significantly higher now.
Fresha’s current range of services include a free-to-use platform for booking appointments; free software for managing accounts; a payments service that includes both a physical point of sale and digital interface; and a wider marketplace both to provide goods to the businesses (B2B); and for the businesses to sell goods to customers (B2C).
The London-based company has 50,000 business customers and 150,000 stylists and professionals in 120+ countries (mostly in the U.K., the U.S., Canada, Australia, New Zealand and Europe), with some 250 million appointments booked to date.
And while many businesses did have to curtail how they operated (and in some countries had to stop operating altogether) Fresha found that it was attracting a lot of new business in part because of its “free” model that meant customers didn’t have to pay to maintain a booking platform at a time when they weren’t taking bookings, but could use Fresha to generate revenues in other ways (such as through the sale of goods, vouchers for future services, and more.)
So in a year when you might have thought that a company based around providing services to industries that were hard hit by Covid would have also been hard-hit, in fact Fresha saw a 30x increase in card payment transactions versus the year before, and more than $12 billion worth of booking appointments made on its platform.
In a market that is very crowded with tech companies building platforms to book beauty (and other) services and to manage the business of independent retailers — they include giants like Lightspeed POS, as well as smaller players like Booksy (which also recently raised) and StyleSeat but also players like Square and PayPal, and many others — the core of Fresha’s offering is a booking platform built as a totally free product.
Why free? To attract more users to its other services (such as payments, which do come at a price), and because co-founders William Zeqiri (CEO) and Nick Miller (product chief) — pictured above, respectively left and right — think this the only way to build a business like this in a crowded market.
“We believe that software is a commodity,” said Zeqiri in an interview. “A lot of our competitors are beating each other on price to the bottom. We wanted to consolidate the supply side of the software, gather data about the businesses, how they use what they use.”
That data led, first, to identifying the need for and building out single all the time and launch its B2B and B2C marketplaces, and the idea is that it will likely lead to more products as it continues to mature, whether its better analytics for its current customers so that they can better price or develop their services accordingly; or entirely new tools for new categories of users.
Meanwhile, the services that it already provides like payments have taken off like a shot, not least because they’ve served a need for any virtual transactions like selling vouchers or items.
Miller noted that while a lot of its customers actually interface with tech with a lot of reluctance — they are the essence of “physical” retailers when you think about it — they also found themselves having to use more digital services simply because of circumstances. “Looking back at what happened, tech adoption accelerated for our customers,” said Miller. He said that current customers usage for the point-of-sale systems and online payments is roughly equal.
Looking ahead, Fresha’s investor list is notable for its strategic mix and might shed some light on how it grows. Kattan, a “beauty influencer” and the founder of Huda Beauty, is investing by way of HB Investments, a strategic venture arm; while Zeisser’s FMZ focuses on “experience economy” investments today, but he himself has a long history working at tech companies building marketplaces, including years with Alibaba as head of its U.S. investment practice. These speak to areas where Fresha is likely interested in expanding its reach — more marketplace activity; and perhaps more social media angles and exposure for its customers at a time when social media really has become a key way for beauty and wellness businesses to market themselves.
“Fresha has emerged as a leader powering the beauty and wellness industry,” said Aaron Goldman, Global Co-head of financial services and MD at General Atlantic, in a statement. “William, Nick and the Fresha team have built a product that is resonating with the market and creating long-term value through the intersection of its payments, software and marketplace offerings. We are thrilled to be partnering with the company and believe Fresha has significant opportunity to further scale its innovative platform.”
“I’ve witnessed first-hand the positive impact Fresha has for beauty entrepreneurs,” added Kattan. “The company is a force for good in the growing community of beauty professionals around the globe, who are increasingly adopting a self-employed approach. By making top business software accessible without any subscription fees, Fresha lets professionals focus on what they do best — offering great experiences for their customers.”
For the early detection and treatment of health conditions, easy access to primary healthcare is crucial. Primary healthcare is best delivered by teams of primary care clinicians coordinating care between them. However, ubiquitous access to such care is scant across Sub-Saharan Africa.
There is a real opportunity for digital healthcare platforms to scale access to team-based care across the region. They can reduce the cost of quality care while improving health outcomes, reach patients in remote areas and reduce the pressure on the traditional medical support systems.
The pandemic has seen such platforms scale globally, and Africa is not exempt. A new platform (without a name yet) is launching out of South Africa and it wants to provide accessible quality care for Africans with its telehealth service. Today, it has closed a $3 million pre-Series A round to that end.
Yes, you’re wondering why the platform doesn’t have a name (I am too), but what’s interesting is the fact that a VC firm (Webrock Ventures) and two health tech companies (Healthforce.io and Doktor.se) joined forces to launch this new venture.
Here’s summarized information on the trio.
Webrock Ventures is a Sweden-based investment company that employs a venture-building model. So essentially, the firm partners with tech companies in Sweden and combines its cash with the company’s business models to create portfolio businesses. It does this while maintaining a sizeable stake in the company.
Healthforce is a South Africa-based health tech company that tries to improve healthcare through multidisciplinary clinical teams. So far, it has set up nurses in over 450 clinics across the country while conducting more than 1 million nurse consultations. Healthforce also has a telemedicine play with over 110,000 consultations since launching the service last year.
As a Sweden-based telehealth company, Doktor.se allows patients to contact healthcare professionals through their smartphones across the whole spectrum of primary care. Most of its customers are in Europe, as well as in Latin America.
So why form a partnership to launch a telehealth product in South Africa with a plan for further roll-out in other African countries down the line?
Globally, telehealth investments have skyrocketed and increased by more than 50% since the start of the pandemic. With many of the fastest-growing economies globally, investors and companies (in this case, Webrock and Doktor.se) are now turning to Africa as a major growth region for such high-demand services.
Now, Doktor.se has two models for commercialising its telemedicine application. The first is to use its technology to personally deliver healthcare services. The second model licenses the core technology to third parties in markets in which Doktor.se has no intention of expanding. Doktor.se achieved this with Brazilian health tech startup ViBe Saúde (via Webrock), and last year, the platform had over 1.2 million patient consultations. It plans to do the same by licensing its technology to deliver care through Healthforce across Africa.
By forming a new partnership, a completely new opportunity is set up. Healthforce can leverage its current position to take core tech from Doktor.se to a new direct-to-patient market. In the background is Webrock, a willing investment machine set up to scale the platform.
The new venture will focus on the uninsured, B2C segment through a freemium-type offering. The platform offers on-demand and scheduled consultations with nurses, general practitioners and mental health professionals. It also provides chronic care management and will be integrated with Healthforce’s broader primary care offering.
Saul Kornik, co-founder and CEO at Healthforce, will resume a new role at the newly formed company. According to him, the partnership gives Healthforce an additional product to add to its healthcare product stack. In addition, it gives Doktor.se the ability to generate license fee revenue from a new market, while Webrock has an opportunity to invest in yet another large developing market.
“Webrock and Healthforce partnered to bring funding and strategic/operational capacity to this new pan-African direct-to-patient play, respectively,” he said to TechCrunch. “All existing independent operations will continue. However, under the NewCo, Healthforce as a major shareholder will expand its primary care product stack and Doktor.se will generate revenue off license fees earned.”
Sub-Saharan Africa has a healthcare market of about $90 billion. But health insurance coverage is in single-digit (percentage-wise) across countries in Sub-Saharan Africa except for South Africa with 16% coverage. Kornik says the three parties want to tackle a large portion of this challenge and are aligned about how the healthcare system in Africa could look if it were functioning optimally.
“This is a pure-play provider-of-healthcare venture. Through this pan-African venture, we will deliver high-quality healthcare at low cost to 75 million people through telemedicine, literally putting healthcare in the palm of their hands,” he said.
Partner at Webrock Ventures Joshin Raghubar and co-founder and CEO of Doktor, Martin Lindman, are enthusiastic about the opportunity Africa presents due to its large population and increasing smartphone penetration.
This new venture, which should hopefully have a name soon, is one of the few health tech platforms based in South Africa that have raised seven-figure sums in a fintech-dominated year. In February, hearX Group, a company that specializes in making hearing healthcare technologies, raised $8.3 million Series A to expand into the U.S. April saw Quro Medical close a $1.1 million seed round to scale its service that manages ill patients in the comfort of their homes. Judging by the spacing between each fundraise, we should see more from the country before the year runs out.
The U.S. healthcare industry is amidst one of the biggest transformations any industry has seen since the dot-com boom of the late 1990s. This massive change is being stimulated by federal mandates, technological innovation, and the need to improve clinical outcomes and communication between providers, patients, and payers.
An aging population, increase in chronic diseases, lower reimbursement rates, and a shift to value-based payments—plus the COVID-19 pandemic—have added pressure and highlighted the need for new technology to enhance virtual and value-based care.
Improving medical outcomes now requires processing massive amounts of healthcare data, and the cloud plays a pivotal role in meeting the current needs of healthcare organizations.
Most of today’s healthcare challenges fall into two broad categories: rapidly rising costs, and an increased burden on resources. Rising costs — and the resulting inadequacy of healthcare resources — can stem from:
An aging population: As people age and live longer, healthcare gets more expensive. As medicine improves, people aged 65 and above are expected to account for 20% of the U.S. population by 2030, per the U.S. Census Bureau. And as older people spend more on healthcare, an aging population is expected to contribute to increasing healthcare costs over time.
Prevalence of chronic illnesses: According to a National Center for Biotechnology Information report, chronic disease treatment makes up 85% of healthcare costs, and more than half of all Americans have a chronic illness (diabetes, high blood pressure, depression, lower back and neck pain, etc.)
Higher ambulatory costs: The cost of ambulatory care, including outpatient hospital services and emergency room care, increased the most of all treatment categories covered in a 2017 study in the Journal of the American Medical Association.
Rising healthcare premiums, out-of-pocket costs, and Medicare and Medicaid: Healthcare premiums rose by an estimated 54% between 2009 and 2019. The COVID-19 pandemic has spurred enrollment into government programs like Medicaid and Medicare, which has increased the overall demand for medical services, contributing to rising costs. A 2021 IRS report highlighted that a shift to high-deductible health plans — with out-of-pocket costs of up to $14,000 per family — has also increased the cost of healthcare.
Delayed care and surgeries due to COVID-19: A poll by the Kaiser Family Foundation (KFF) in May 2020 indicated that up to 48% people have avoided or postponed medical care due to concerns about the COVID-19 pandemic. About 11% of those people reported that their medical condition worsened after skipping or postponing care. Non-emergency surgeries were frequently postponed, as resources were set aside for COVID-19 patients. These delays make treatable conditions more costly and increase overall costs.
A lack of pricing transparency: Without transparency, it’s difficult to know the actual cost of healthcare. The fragmented data landscape fails to capture complete details and complex medical bills, and does not give patients a complete view of payments.
To mitigate the impact of increased costs and inadequate resources, healthcare organizations need to replace legacy IT programs and adopt modern systems designed to support rapid innovation for site-agnostic, collaborative, whole-person care — all while being affordable and accessible.
On Monday, a 17-year drought in the world of Alzheimer’s drugs ended with the FDA approval of Biogen’s Aduhlem (aducanumab). The controversy behind the FDA’s decision was considerable, but it doesn’t seem to be spooking drug developers who are now narrowing in on the degenerative brain disease.
In a nutshell, the approval of Aduhelm came after conflicting results from clinical trials. In November 2020 an independent FDA advisory board did not recommend that the agency endorse the drug, but in June, the agency approved the drug anyway via an Accelerated Approval Program.
Aduhelm is now the first novel treatment to address one underlying cause of Alzheimer’s – beta-amyloid plaques that accumulate in the brain.
The drug received support from patient and industry groups (the FDA also noted that the “need for treatment is urgent”, in a statement explaining the agency’s choice). Still, there have been a number of doctors who have expressed concern. One member of the expert committee that voted not to recommend the approval of Aduhelm back in November has resigned since the announcement.
However, the inconsistency of the science and highly public debate around the approval of Aduhelm doesn’t seem to have halted enthusiasm within the pharmaceutical industry. Rather, it may signal a new wave of additional treatments in the next few years, which will piggyback off of the approval of Aduhelm (however controversial that approval may be).
“This is great news for investors and for drug companies that are working towards new drugs,” says Alison Ward, a research scientist at the USC Schaeffer Center for Health Policy and Economics.
Historically there have been a few factors that have made the development of a drug for Alzheimer’s an uphill battle.
The first, is a 17-year history of failure to bring a drug through clinical trials. Even Biogen’s clinical trials for Aduhelm were halted in 2019 because it wasn’t clear that they would reach their clinical endpoints (effectively, the target outcomes of the trial). In fact, Aduhlem was approved based on a “surrogate endpoint,” the decline of beta-amyloid, not the primary endpoint, cognitive function.
Trials for Alzheimer’s drugs have also historically been expensive. A 2018 paper in Alzheimer’s and Dementia: Translational Research and Clinical Interventions (a journal run by the Alzheimer’s Association) estimated that the cost of developing an Alzheimer’s drug was about $5.6 billion. By comparison, the mean investment needed to bring a new drug to market is about $1.3 billion according to analysis of SEC filings for companies that applied for FDA approval between 2009 and 2018 (though the median cost was about $985 million). Older estimates have put the costs of bringing a drug to market at $2.8 billion.
For Alzheimer’s specifically, Phase 3 trials are still largely sponsored by industry, but over the past five years, trials sponsored solely by the industry have decreased. Government grants and funding via public-private partnerships have made up an increasing share of available funds.
Martin Tolar, the founder CEO of Alzheon, another company pursuing an oral treatment for Alzheimer’s (currently in a phase 3 clinical trial), says that attracting other forms of funding was a challenge.
“It was impossible to finance anything,” he says. “It was impossible to get Wall Street interested because everything was failing one after the other after the other.”
He expects this recent approval of Aduhelm to change that outlook considerably. Already, we are seeing some increased interest in companies already in phase 3 clinical trials: After the FDA announcement, shares of Eli Lilly, also running a phase 3 clinical trial, surged by 10 percent.
“I’ve had probably hundreds of discussions, of calls, from bankers, investors, collaborators, pharma, you name it,” Tolar says. “Alzheimer’s is open for business.”
With renewed interest and what appears like a pathway to approval at the FDA, the environment for the next generation of Alzheimer’s drugs seems to be ripening. Right now, there are about 130 phase 3 clinical trials on Alzheimer’s drugs that are either completed, active or recruiting.
Tolar sees the FDA decision, based on imperfect data, as a “signal of urgency” to approve new treatments that are imminent arrivals.
As Ward pointed out in a white paper on in-class drug innovation, “follow on” drugs go on to become leaders in the industry, especially if they demonstrate better safety or efficacy than the drug that was first to market. That, the paper argues, suggests drug approval may “pave the way” for more effective drugs in the future.
In the case of Alzheimer’s, it might not be one drug that dominates, even as more get approved, she notes. Rather, a cadre of new, approved drugs may go on to compliment one another.
“The way that the medical community is thinking of AD [Alzheimer’s Disease] now is that it’s likely going to be a combination of drugs or a cocktail of drugs that comes together to have true success at delaying progression,” she says.
“If we’re looking to treat AD with a cocktail of drugs, history suggests it’s individually approved drugs that come together to make those drug cocktails.”
There are still some potential pitfalls for future drugs to consider. One argument is that with an approved drug available, it may be more difficult to recruit participants in clinical trials, slowing the pace of drug discovery. In that respect, Ward argues that this will ultimately be dwarfed by patients who will now look into a potential diagnosis for Alzheimer’s now that there’s something to treat it with.
There’s also the fact that Aduhelm’s costs are high (about $56,000 for a year’s supply, the brunt of which will be borne by Medicare), and the data remains questionable. Those factors may push patients towards other drugs, even if they’re in clinical trials.
Additionally, there is the question of how well Aduhelm actually performs during the critical followup study mandated by the FDA as a condition of the drug’s approval. Whether Aduhelm can truly slow cognitive decline, as well as help address levels of beta-amyloid from the brain, remains questionable based on current data.
Still, Tolar doesn’t see the results of that study as particularly relevant because the industry will have moved on. Biogen CEO Michel Vounatsos has said it may not share results of this trial for as many as nine years, though he noted the company would try to deliver data sooner.
“There will be better drugs by then,” Tolar predicts.
Tolar’s phase 3 clinical trial just began dosing this week, and is scheduled to end by 2024.
Biogen and Esai will likely also have another drug ready for evaluation by then, as two phase 3 clinical trials for another beta-amyloid antibody treatment called lecanemab are scheduled for completion by 2024 and 2027.
The signal sent by Monday’s approval may be a pathway for future drugs, rather than an end itself. The data is imperfect, the costs high, and the controversy considerable, but the band-aid has been ripped off.
Rachel Blank has a history with hormones. The entrepreneur left her investment job at General Catalyst to join a portfolio company they had been backing since its seed round: Ro. Blank was tasked with growing Rory, a product line for menopausal women.
But Blank left her director position at the health tech unicorn, last valued at $5 billion, to start her own company in women’s hormonal health. Today, that startup is launching out of stealth with millions in venture-backing and more than 35,000 women in its community.
Allara is an early-stage, New York-based startup that wants to help women better manage polycystic ovary syndrome, or PCOS. The reproductive and hormonal condition can cause irregular periods, infertility or gestational diabetes in women, as well as acne, weight gain and excessive hair growth. And it’s far from rare, affecting some one in 10 women of childbearing age.
Along with launching today, the company told TechCrunch that it has raised $2.5 million in a seed round led by Global Founders Capital, with participation from Great Oaks and Humbition.
Allara bundles a suite of services needed to address PCOS — such as gynecologists, nutrition plans or mental health support — and gives consumers one spot to access all of the above. The company describes it as a “collaborative care management model.”
When a consumer first joins the platform, Allara asks them to go through a virtual on-boarding visit with a medical provider. That provider can arrange for labs, then review the lab work and medical history to better understand a patient’s background. Lab work, and any prescriptions, are paid for by the consumer through traditional insurance.
Then, the rest of Allara moves out of pocket. Allara charges $100 a month for access to its care team. Patients get quarterly check-ins with their providers, and have ongoing text-based access to registered dietitians to help with eating and lifestyle goals. Blank explained how Allara wants to make sure all services find ways to talk to each other, creating a patient experience where a nutritionist already knows what your OB-GYN told you and vice-versa so a care plan is centralized.
If it pulls it off, this is where the heart of Allara’s innovation lies: creative ways to take care of people.
One hurdle for Allara, and any company working on a solution for this condition, is that PCOS is hard to diagnose, and impossible to fully cure. Like many hormonal conditions, the condition looks different in everyone, which is part of the reason it’s so hard for doctors to identify. There is no blood test, and there is no pill to pop.
PCOS is currently diagnosed with the Rotterdam criteria, which means a patient must have two of the following three conditions: irregular period, excess androgen or polycystic ovaries. Some research argues that the criteria is controversial and not fully inclusive of the spectrum of how PCOS presents. For now, the Rotterdam criteria is the best method toward diagnosing.
Blank says that Allara’s goal is all about “managing risk.”
“It’s not that women with these conditions weren’t looking for a solution,” Blank said. “It’s that they’re all desperately looking for solutions, but the solutions haven’t existed yet.”
Over the past few months, Allara has been operating under a different name — Astrid — to build up interest and get feedback needed to iterate its product. Blank claims that more than 35,000 women are part of its community, either directly or on a waitlist, underscoring the demand for explicit attention on this condition. The startup recently began seeing patients.
Allara is the latest startup to bet that hormonal health is a key wedge into the digital health boom. Companies like Adyn, Modern Fertility, Tia, Veera Health and Perla Health are all working on different ways to better serve hormonal disorders.
Still, the sector remains relatively nascent compared to other health conditions. Blank chalks up part of this truth to stigma.
“There’s been a lack of understanding what women’s health means,” Blank said, explaining how society often views it as a fertility or reproductive health condition. Blank thinks that PCOS is a common thread between a multitude of conditions, from fertility, diabetes, increased risk of uterus and endometrial cancer, heartsease, anxiety and depression.
When she explains this, she said, people are able to get the market opportunity.
“How do we treat women’s healthcare in a way that their entire healthcare outcomes become better but we’re taking on the nuances of them being women?” Blank said.
Blank herself was diagnosed with PCOS at the age of 21, which came as a surprise to her.
“I think what made it more surprising is that my dad is actually an OB-GYN,” she said. “So even though I had grown up around women’s healthcare, and had access to the best of women’s health specialists, I even struggled with getting a process and understanding what was going on in my body.”
Blank initially joined Ro because of her passion for polycystic ovary syndrome, or PCOS. Allara is a return to, and doubling down on, her belief in the condition needing a better standard of care.
As for going solo, and not building it within Ro’s blanket of brands and massive footprint, Blank explained how her vision of specialty care and services is different from what Ro focuses on, which is largely primary care and prescription focus. Notably, Ro did acquire Modern Fertility, a hormonal health company, for north of $225 million, last month.
“PCOS was just part of my personal story — not the vision for Rory,” she said. “Allara is not a primary care platform — it’s a specialty care platform, developing new clinical care models for complex women’s health conditions like PCOS. Imagine it as a place a primary care platform might refer a patient to if they discover she has more complex needs than they can currently serve.”
News broke this morning that Bain Capital Private Equity and Crosspoint Capital Partners are purchasing Seattle-based network security startup ExtraHop.
Part of the Network Detection and Response (NDR) market, ExtraHop’s security solutions are for companies that manage assets in the cloud and on-site, “something that could be useful as more companies find themselves in that in-between state,” report Ron Miller and Alex Wilhelm.
Just one year ago, ExtraHop was closing in on $100 million in ARR and was considering an IPO, so Ron and Alex spoke to ExtraHop CTO and co-founder Jesse Rothstein to learn more about how (and why) the deal came together.
Have a great week, and thanks for reading!
Senior Editor, TechCrunch
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Xometry, a Maryland-based service that connects companies with manufacturers with excess production capacity around the world, filed an S-1 form with the U.S. Securities and Exchange Commission last week announcing its intent to become a public company.
As the global supply chain tightened during the pandemic in 2020, a company that helped find excess manufacturing capacity was likely in high demand.
But growth aside, it’s clear that Xometry is no modern software business, at least from a revenue-quality profile.
The average corporate security organization spends $18 million annually but is largely ineffective at preventing breaches, IP theft and data loss. Why?
The fragmented approach we’re currently using in the security operations center (SOC) does not work. It’s time to replace the security information and event management (SIEM) approach with security data lakes.
The reduced reliance on the SIEM is well underway, along with many other changes. The SIEM is not going away overnight, but its role is changing rapidly, and it has a new partner in the SOC — the security data lake.
There has been a wave of businesses over the past several years hoping to offer broadband internet delivered from thousands of satellites in low-Earth orbit (LEO), providing coverage of most of the earth’s surface.
In tandem with the accelerated deployment of SpaceX’s Starlink constellation in 2020, China has rapidly responded in terms of policy, financing and technology. While still in early development, a “Chinese answer to Starlink,” SatNet, and the associated GuoWang are likely to compete in certain markets with Starlink and others while also fulfilling a strategic purpose from a government perspective.
With considerable backing from very high-level actors, we are likely to see the rollout of a Red Star(link) over China (and the rest of the world) over the coming years.
Babylon Health, a British health tech company, is pursuing a U.S. listing via a blank-check company, or SPAC.
While we wait for Robinhood’s IPO, The Exchange dove into its fundraising history, its product, its numbers and, bracing ourselves for impact, its projections.
Conventional wisdom says your board should include a few CEOs who can offer informed advice from an entrepreneur’s perspective, but adding a technical leader to the mix creates real upside, according to Abby Kearns, chief technology officer at Puppet.
Beyond their engineering experience, CTOs can help founders set realistic timelines, help identify pain points and bring what Kearns calls “pragmatic empathy” to high-pressure situations.
They can also be an effective advocate for founder teams who need help explaining why a launch is delayed or new engineering hires are badly needed.
“A CTO understands the nuts and bolts,” says Kearns.
As someone with “founder” on your resume, you face a greater challenge when trying to get a traditional salaried job.
You’ve already shown that you really want to lead a company, not just rise up the ladder, which means some employers are less likely to hire you.
So what should you do? Especially if your life partner and/or bank account are burnt out on the income volatility of startups?
Here are six options for ex-founders planning their next move.
In the fifth and final part of Expensify’s EC-1, Anna Heim explores how the company built its business, true to form, in an unexpected way.
“You’d expect an expense management company to have a large sales department and advertise through all kinds of channels to maximize customer acquisition, Anna writes. But “Expensify just doesn’t do what you think it should.
“Keeping in mind this company’s propensity to just stick to its guts, it’s not much of a surprise that it got to more than $100 million in annual recurring revenue and millions of users with a staff of 130, some contractors, and an almost non-existent sales team.”
How is that much growth possible without a sales team? Word of mouth.
Maryland and Montana have become the first U.S. states to pass laws that make it tougher for law enforcement to access DNA databases.
The new laws, which aim to safeguard the genetic privacy of millions of Americans, focus on consumer DNA databases, such as 23andMe, Ancestry, GEDmatch and FamilyTreeDNA, all of which let people upload their genetic information and use it to connect with distant relatives and trace their family tree. While popular — 23andMe has more than three million users, and GEDmatch more than one million — many are unaware that some of these platforms share genetic data with third parties, from the pharmaceutical industry and scientists to law enforcement agencies.
When used by law enforcement through a technique known as forensic genetic genealogy searching (FGGS), officers can upload DNA evidence found at a crime scene to make connections on possible suspects, the most famous example being the identification of the Golden State Killer in 2018. This saw investigators upload a DNA sample taken at the time of a 1980 murder linked to the serial killer into GEDmatch and subsequently identify distant relatives of the suspect — a critical breakthrough that led to the arrest of Joseph James DeAngelo.
While law enforcement agencies have seen success in using consumer DNA databases to aid with criminal investigations, privacy advocates have long warned of the dangers of these platforms. Not only can these DNA profiles help trace distant ancestors, but the vast troves of genetic data they hold can divulge a person’s propensity for various diseases, predict addiction and drug response, and even be used by companies to create images of what they think a person looks like.
Ancestry and 23andMe have kept their genetic databases closed to law enforcement without a warrant, GEDmatch (which was acquired by a crime scene DNA company in December 2019) and FamilyTreeDNA have previously shared their database with investigators.
To ensure the genetic privacy of the accused and their relatives, Maryland will, starting October 1, require law enforcement to get a judge’s sign-off before using genetic genealogy, and will limit its use to serious crimes like murder, kidnapping, and human trafficking. It also says that investigators can only use databases that explicitly tell users that their information could be used to investigate crimes.
In Montana, where the new rules are somewhat narrower, law enforcement would need a warrant before using a DNA database unless the users waived their rights to privacy.
The laws “demonstrate that people across the political spectrum find law enforcement use of consumer genetic data chilling, concerning and privacy-invasive,” said Natalie Ram, a law professor at the University of Maryland. “I hope to see more states embrace robust regulation of this law enforcement technique in the future.”
The introduction of these laws has also been roundly welcomed by privacy advocates, including the Electronic Frontier Foundation. Jennifer Lynch, surveillance litigation director at the EFF, described the restrictions as a “step in the right direction,” but called for more states — and the federal government — to crack down further on FGGS.
“Our genetic data is too sensitive and important to leave it up to the whims of private companies to protect it and the unbridled discretion of law enforcement to search it,” Lynch said.
“Companies like GEDmatch and FamilyTreeDNA have allowed and even encouraged law enforcement searches. Because of this, law enforcement officers are increasingly accessing these databases in criminal investigations across the country.”
A spokesperson for 23andMe told TechCrunch: “We fully support legislation that provides consumers with stronger privacy protections. In fact we are working on legislation in a number of states to increase consumer genetic privacy protections. Customer privacy and transparency are core principles that guide 23andMe’s approach to responding to legal requests and maintaining customer trust. We closely scrutinize all law enforcement and regulatory requests and we will only comply with court orders, subpoenas, search warrants or other requests that we determine are legally valid. To date we have not released any customer information to law enforcement.”
GEDmatch and FamilyTreeDNA, both of which opt users into law enforcement searches by default, told the New York Times that they have no plans to change their existing policies around user consent in response to the new regulation.
Ancestry did not immediately comment.
As people live longer and longer and have long-term health issues like cancer and dementia, caring for elderly relatives is becoming a huge societal and political issue. Right now this care is antiquated and run by incumbents, many of which still run off paper and Excel. We are now seeing a new wave of startups turn up to tackle this space by applying Apple’s age-old model of owning the experience end-to-end and running everything on a platform.
The latest to join this race is UK startup Lifted, which has now raised $6.2 million in a Series A funding round led by Fuel Ventures. Also participating were existing investor 1818 Venture Capital as well as new investors Novit Ventures, Perivoli Innovations, the J.B. Ugland family office, and a number of Angels. This latest funding round takes the total raised by Lifted to $11.2M.
Lifted says its UK market is increasing and claims the number of people caring for adult loved ones has risen exponentially during the pandemic, with almost 1 in 2 people supporting people outside their household.
The startup is entering a perfect storm of increasing need, unpopular care homes, and the UK Government still without a long-term plan for social care.
In contrast to a raft of agencies and freelancers, Lifted directly employs its care workforce and uses its platform to “gamify and improve the experience of carers to make them perform better in people’s lives and also to restore respect to the caring profession” with its Care Management Platform, says the company.
Lifted has also acquired the ‘Live Better With Dementia’ website and launched the Lifted Dementia Hub, an online community with a marketplace of products.
Rachael Crook co-founded Lifted with Sam Cohen. She says she was inspired to get into the sector when, at the age of 24, she had to care for her mother, who was diagnosed with dementia at age 56.
Rachael Crook, Lifted CEO sold me at an interview: “I was in that position much younger than most people. And it seemed abundantly clear to me that it was an experience that was hugely emotionally important to me, and financially expensive, was really convoluted and frustrating. It made an already really difficult time, more difficult. My mum brought me up to really fight for the underdog and I felt like the carers themselves were getting a really poor deal. And yet, it’s a huge colossal market. The care market is set to double in the next 20 years, and for the next 10 years, we will look to compete against traditional care companies. We want to transform the care experience. This is a product that is worth four and a half times your mortgage. And yet, it’s predominantly bought in a really antiquated way with paper and pen systems. It’s really hard to keep up to date with your loved ones’ care. We’re also competing against new entrants.”
She added: “In 12 months, we have tripled revenue, launched the first App in the world to offer free care advice, and cut Carer churn to half the industry average, all while maintaining exclusively 5-star reviews on Trustpilot.”
Mark Pearson, Managing Partner of Fuel Ventures said: “Rachael, Sam and their team have delivered exceptional growth in the past year. They have a unique vision of the future for care and their model is delivering clear results for both sides of the marketplace.”
Today, Apple detailed its plans for watchOS 8, the next major software update for the Apple Watch. Apple introduced some smaller updates to health and fitness features, improved texting and photo sharing, and new HomeKit integrations.
The Apple Watch’s Breathe app has new animations and adds “Reflect,” which gives you mindfulness prompts to accompany a calming animation while you reflect. These new features are found under the new Mindfulness app.
In Fitness, Apple is adding two new workouts: Tai Chi and Pilates. Apple Fitness+ is adding another set of workouts focused on HIIT (high-intensity interval training), along with Artist Spotlights, which suggests music to aid your workout. watchOS8 will also add respiratory-rate tracking to sleep but not workouts.
Welcome back to the week, and welcome back to The Exchange. Robinhood has yet to file its IPO, so we’re looking at other companies in the meantime. Today it’s Babylon Health, a British healthtech company that is pursuing a U.S. listing via a blank-check company, or SPAC.
You have questions. I have questions. We’ll get to some answers.
But before we do, we wanted to note that Anna and I are looking into the AI startup market tomorrow morning. If you are a VC with notes regarding the current pace of investment into the sector or thoughts on where customer traction is highest, let us know. If you are a founder building an AI-powered startup, we’d also like to hear from you about what you are seeing. Use the subject line “AI startups,” please.
The Exchange explores startups, markets and money.
With that out of the way, let’s get into Babylon Health. We’ll kick off with a short riff on its fundraising history, talk about its product, and then dive into its numbers and, bracing ourselves for impact, its projections.
The larger context this morning is that we’re doing legwork ahead of what could be a super active Q3 2021 IPO cycle. Kanzhun, a Chinese company, has also filed for a U.S. listing. Toss in Robinhood whenever it gets off its duff and gives us its own filing, and we’re being promised a good time.
Per Crunchbase data, Babylon has raised north of $600 million as a private company. Its funding, however, has not come from sources that we tend to discuss here at TechCrunch. Instead, the company raised some money from more traditional investors like Hoxton Ventures and Kinnevik, but the bulk of its capital was raised from the Saudi Arabian “Public Investment Fund,” or PIF. The PIF led a $550 million round into the British healthtech company back in August 2019.
PitchBook has the round cut into two parts, the larger, first portion of which valued the company at $1.9 billion on a post-money basis.
That figure brings us to the SPAC deal that Babylon is now pursuing. The company’s new equity value after its SPAC deal will land around $4.2 billion, with Babylon sitting on around $540 million in cash after the deal is completed. The company will sport a lower, $3.6 billion enterprise valuation after its merger with SPAC Alkuri.
The medical industry is sitting on a huge trove of data, but in many cases it can be a challenge to realize the value of it because that data is unstructured and in disparate places.
Today, a startup called Mendel, which has built an AI platform both to ingest and bring order to that body of information, is announcing $18 million in funding to continue its growth and to build out what it describes as a “clinical data marketplace” for people not just to organize, but also to share and exchange that data for research purposes. It’s also going to be using the funding to hire more talent — technical and support — for its two offices, in San Jose, CA and Cairo, Egypt.
The Series A round is being led by DCM, with OliveTree and MTVLP, and previous backers Launch Capital, SOSV, Bootstrap Labs and Chairman of UCSF Health Hub Mark Goldstein also participating.
The funding comes on the heels of what Mendel says is a surge of interest among research and pharmaceutical companies in sourcing better data to gain a better understanding of longer-term patient care and progress, in particular across wider groups of users, not just at a time when it has been more challenging to observe people and run trials, but in light of the understanding that using AI to leverage much bigger data sets can produce better insights.
This can be important, for example, in proactive identifying symptoms of particular ailments or the pathology of a disease, but also recurring and more typical responses to specific treatment courses.
We previously wrote about Mendel back in 2017 when the company had received a seed round of $2 million to better match cancer patients with the various clinical trials that are regularly being run: the idea was that certain trials address specific types of cancers and types of patients, and those who are willing to try newer approaches will be better or worse suited to each of these.
It turned out, however, that Mendel discovered a problem in the data that it would have needed to enable its matching algorithms to work, said Dr. Karim Galil, Mendel’s CEO and founder.
“As we were trying to build the trial business, we discovered a more basic problem that hadn’t been solved,” he said in an interview. “It was the reading and understanding medical records of a patient. If you can’t do that you can’t do trial matching.”
So the startup decided to become an R&D shop for at least three years to solve that problem before doing anything with trials, he continued.
Although there are today many AI companies that are parsing unstructured information in order to extract better insights, Mendel is what you might think of as part of the guard of tech companies that are building out specific AI knowledge bases for distinct verticals or areas of expertise. (Another example from another vertical is Eigen, working in the legal and finance industries, while Google’s DeepMind is another major AI player looking at ways of better harnessing data in the sphere of medicine.)
The issue of “reading” natural language is more nuanced than you might think in the world of medicine. Gali compared it to the phrase “I’m going to leave you” in English, which could just as easily mean someone is departing, say, a room, as someone is walking out of a relationship. The “true” answer — and as we humans know even truth can be elusive — can only start to be found in the context.
The same goes for doctors and their observation notes, Galil said. “There is a lot hidden between the lines, and problems can be specific to a person,” or to a situation.
That has proven to be a lucrative area to tackle.
Mendel uses a mix of computer vision and natural language processing built by teams with extensive experience in both clinical environments and in building AI algorithms and currently provides tools to automate clinical data abstraction, OCR, special tools to redact and remove personal identifiable information automatically to share records, search engines to search clinical data, and — yes — an engine to enable better matching of people to clinical trials. Customers include pharmaceutical and life science companies, real-world data and real-world evidence (RWD and RWE) providers and research groups.
And to underscore just how much there is still left to do in the world of medicine, along with this funding round, Mendel is announcing a partnership with eFax, an online faxing solution used by a huge number of healthcare providers. Faxing is totally antiquated in some parts of the world now — I’m not even sure that people the age of my children (tweens) even know what a “fax” is — but they remain one of the most-used ways to transfer documents and information between people in the worlds of healthcare and medicine, with 90% of the industry using them today. The partnership with Mendel will mean that those eFaxes will now be “read” and digitized and ingested into wider platforms to tap that data in a more useful way.
“There is huge potential for the global healthcare industry to leverage AI,” said Mendel board member and partner at DCM, Kyle Lui, in a statement. “Mendel has created a unique and seamless solution for healthcare organizations to automatically make sense of their clinical data using AI. We look forward to continuing to work with the team on this next stage of growth.”
Tata Digital, a subsidiary of Indian conglomerate Tata Sons, said on Monday it has signed a deal to invest up to $75 million in fitness startup CureFit. As part of the deal, CureFit co-founder and chief executive Mukesh Bansal will join Tata Digital as President and also continue in his role at the Bangalore-headquartered startup.
Monday’s investment is the salt-to-steel giant’s latest effort to expand its presence in the consumer tech space. Earlier this year, Tata Group acquired majority stake in online grocery startup BigBasket, and is reportedly in talks to acquire online pharmacy 1mg, according to local media reports.
Prior to today’s announcement, CureFit had raised about $418 million and was last valued at $815 million, according to insight firm Tracxn. The startup, which expanded to the U.S. market last year, had about 1.5 million monthly active users in India last month, according to mobile insight firm App Annie — data of which an industry executive shared with TechCrunch.
“Joining Tata Digital marks an exciting new step for me and my team and is a recognition of the value we have created with CureFit for fitness enthusiasts in India,” said Bansal, who sold his previous venture Myntra to Flipkart, in a statement.
“Being part of Tata Digital will enable us to nationally scale up our offerings for our customers,” he added.
This is a developing story. More to follow…