Just raises $8M in its effort to beat Root at the car insurance game

Just Insure, a pay-per-mile insurance technology company, has raised $8 million in a funding round. 

CrossCut Ventures, ManchesterStory and Western Technology Investments co-led the investment, which brings its total raised to $15.3 million since its January 2019 inception.

Los Angeles-based Just says it uses telematics “to reward safe drivers and reduce insurer bias” by looking at factors such as how, when and where customers drive, rather than factors such as ZIP code or marital status as most traditional insurers do. Or put more simply, it charges customers only for miles driven and its rates vary based on driving behavior. This way, Just says it’s able to offer lower rates for “safer drivers,” and it claims to save its customers around 40% from their “previous auto insurance company.” For now, it’s only available in Arizona, although the company plans to expand to other markets such as Texas, Nevada, Pennsylvania, Ohio and Georgia.

Image Credits: Just Insure

Of course, Just is not the first company to offer personalized auto insurance. There’s Metromile, which launched its personalized pay-per-mile auto insurance in 2012. And there’s also Root Insurance, an Ohio-based car insurance startup that uses smartphone technology to understand individual driver behavior. Although there are similarities between Root and Just, there are also distinct differences, according to founder and CEO Robert Smithson.

Root charges customers a monthly fee, and when policies are renewed, the rate is subject to change based on driving behavior. Just has a similar model. If its drivers exhibits safe driving behavior, their rates can fall. On the other hand, if they exhibit dangerous behavior, their rates can rise. But unlike Root, Smithson said, Just only charges its “liability only” customers for miles driven. There is no monthly fee. For “full cover” customers, Just also includes a “small daily charge” to reflect the risk that someone could steal their car. For its part, MetroMile charges customers a base rate plus a per mile rate. Neither rate are affected by how a person drives, notes Smithson.

“The [Just] per mile price that a customer gets can change every month. This means we’re able to rapidly reward safe drivers with lower rates, and to increase them for those who drive less well,” Smithson said. “This rapid feedback loop encourages people to make smarter driving decisions. And it means that our customers have fewer accidents, and we do better. ”

In 2020, Root had a direct loss ratio of 82%. Just’s direct loss ratio is 65.8% year to date so far. But of course, it has far fewer customers and is only serving one market. Still, the company says that it has already achieved underwriting profitability in terms of what portion of premium to it pays out in claims.

Also, with so many people shifting to working from home over the last year, Just says it has seen increased demand this year. It issued over 1,000 new policies in the second quarter, up “tenfold” compared to the same period in 2020. The startup said during that same time, its revenue climbed 1,400% compared to the second quarter of 2020

“People are simply driving less as a result of increased work-from-home rates, and this isn’t changing anytime soon,” Smithson said. “Our approach enables us to offer customers rates that are truly reflective of their driving.”

The company likens its user experience to that of a prepaid phone card. Just customers can “load up” their account for $30 for minimum liability-only coverage and $75 for full coverage to start driving. The company’s insurance policy is for 30 days. So as customers drive, their balance declines. Every 30 days, the company changes each customer’s price as it gathers more data about their driving habits.

It’s an approach that Matt Kinley, co-founder and managing partner at ManchesterStory, had never before seen.

“It is more fair, affordable and customized across the board, and unique because the company offers customers rates that are actually reflective of their driving, which rewards safe drivers with lower insurance premiums,” he said.

The company plans to use its new capital in part to do some hiring — it currently has a staff of 35 — and scale its product offering. It is also planning to launch beyond Arizona into neighboring states. In particular, Smithson said the startup is “keen” to launch in Texas.

#apps, #crosscut-ventures, #finance, #funding, #fundings-exits, #insurance-technology, #insurtech, #just, #los-angeles, #manchesterstory, #recent-funding, #startup, #startups, #transportation, #venture-capital, #western-technology-investments

Concreit closes on $6M to allow more people to invest in the global private real estate market

Concreit, a company that wants to open real estate investing to a broader group of people, announced today that it has closed $6 million in a seed funding round led by Matrix Partners. 

Hyphen Capital also participated in the round, in addition to individual investors such as Betterment founder and CEO Jon Stein; Andy Liu, partner at Unlock Venture Partners; and investor and advisor Ben Elowitz. Concreit raised the capital at a $22.5 million post-money valuation.

The Seattle-based startup also today launched its app, which it claims allows “anyone” to invest in the global private real estate market for as little as $1. 

It’s a lofty claim. But first let’s start with some background.

Concreit is not the first time that co-founders Sean Hsieh and Jordan Levy have worked together. The pair previously founded and bootstrapped VoIP communications platform Flowroute before selling it to West Corp. in 2018. Upon the sale of that company, Hsieh and Levy set out to build a company that, in their words, “could help everyday people become more financially secure.”

Hsieh, a second-generation immigrant, worked in his family’s restaurant where they shared the dream of achieving financial freedom through real estate. Similarly, Levy says he grew up watching his parents build a small construction business from scratch. He was intrigued by the idea of passive income through single-family rental homes but became disillusioned with the overhead, risk and hassle of managing one’s own single-family rental investments. 

So the duo worked together to design a mobile-first offering that could enable small investors to benefit from real estate “without the burden of making repairs at 2 a.m. on a Saturday.” Enter Concreit. 

Today, most investors can open a Concreit account and make their first investment in just minutes on their mobile device, the company claims. The company’s free mobile app allows consumers to invest as little as $1 into a fund managed by a team of investment professionals. Withdrawals can be requested at any time through the app and sent upon approval.

The platform facilitates weekly earned payouts, automated investments and on-demand withdrawals while compounding earned payouts weekly.

After selling Flowroute, Hsieh says he “saw the opportunity to earn a great APR through private real estate investing while gaining less correlation with traditional public stocks or bonds markets,” Hsieh said. “But they were only for the already wealthy or required multiyear commitments of capital. Concreit gives everyone access to a real estate portfolio and the ability to have access to withdrawals when they need them.”

Put simply, the startup wants to make it easy for anyone — not just the wealthy — to invest in real estate.

Concreit, Hsieh said, offers “regular people” the ability to access real estate strategies typically used by large hedge funds and private equity. 

“We’re seeing a surge of retail demand for alternatives and other ways to invest outside of the public markets and the crypto space for those that value diversification,” Hsieh told TechCrunch. Most other competitors are focused on marketing and selling securities, but we knew in order to be an innovator in this space we had to produce a truly unique experience for our investors.”

Concreit’s platform is designed to be a more connected investment experience.

“We knew early on that digital natives deserved a whole new real estate investing experience and that it had to be 100x better than just taking traditional real estate investment opportunities and offering them digitally,” Hsieh said. 

So on the platform side, Concreit has built a cloud-based proprietary securities accounting engine that allows the company to process fractional calculations and pull in a lot of mutual fund practices, applying them toward the “more labor-intensive” private equity markets, with a focus on real estate.

“We’ve taken a lot of the cloud-architectural work that we’ve pioneered in the telecommunications space and applied it towards a back-office accounting solution that gives us a competitive edge around what we offer to our investors,” Hsieh said. “This affords the ability to run accounting at a higher frequency, which is how we are able to run weekly dividends, process fractional redemptions and ultimately a more real-time experience for our users.”

Concreit’s first private REIT fund, focused on passive income, consists of lower-risk fixed-income private market residential and commercial real estate first-lien mortgages. The fund, which the company says has an annualized return of 5.47%, is managed by a team of industry professionals. The startup has added over 18,000 customers to its platform since it was qualified by the SEC (slightly over a year ago), and doubled its user base in the month of August.

“Our current users can invest with any dollar amount, no lock-ups, weekly payouts, and an experience that’s as easy & familiar as a savings account,” Hsieh said.

Matrix’s Dana Stalder, who joined Concreit’s board as part of the financing,  believes Concreit has leveled the playing field for real estate investing by making it more accessible. 

“What Concreit has built is incredibly hard to do from both a technology and regulatory standpoint,” he told TechCrunch. “Alternative asset classes, in particular, have been notoriously closed off to the average consumer, leaving high yield returns exclusively to wealthy investors. “

#apps, #concreit, #dana-stalder, #funding, #fundings-exits, #matrix-partners, #real-estate, #real-estate-tech, #recent-funding, #seattle, #startup, #startups, #tc, #venture-capital

Kapor Capital, Square co-founder Sam Wen back TomoCredit in its $10M Series A funding round

Building credit history can be difficult if you are a consumer that is having trouble getting access to credit in the first place.

Enter TomoCredit, which has developed a credit card focused on building credit history for first-time borrowers. The San Francisco-based startup is announcing today that it has raised $10 million in a Series A funding round co-led by Kapor Capital and KB Investment Inc. (KBIC), a subsidiary of South Korea’s leading consumer bank. Lewis & Clark Ventures, AME Cloud Ventures, Knollwood Investment Advisory, WTI, Bronze and Square co-founder Sam Wen also participated in the Series A financing.

The new capital comes just over seven months after TomoCredit raised $7 million in seed funding, and brings its total raised this year to $17 million. The company also announced today it has appointed Ash Gupta, former CRO at American Express, to its board.

TomoCredit co-founder and CEO Kristy Kim came up with the concept for the company after being rejected multiple times for an auto loan while in her early 20s.

Kim, who immigrated to the U.S. from South Korea with her family as a child, was disappointed that her lack of credit history proved to be such an obstacle despite the fact she had a job “and positive cash flow.”

So she teamed up with Dmitry Kashlev, a Russian immigrant, in January of 2019 to create a solution for other foreign-born individuals and young adults facing similar credit challenges. That fall, the startup (short for Tomorrow’s Credit) was accepted into the Barclays Accelerator, powered by Techstars.

The fintech offers a credit card aimed at helping first-time borrowers build credit history, based on their cash flow, rather than on their FICO or credit report ratings. Its biggest differentiator, believes Kim, is that it has no fees, no APR and no credit pull. Traditional credit products rely heavily on fees and APR, she said, while TomoCredit makes money through merchant fees.

Image Credits: TomoCredit

TomoCredit is powered by Finicity (which was acquired by Mastercard last year), and leverages that company’s data network and open banking technology so that it can “securely” access applicants’ bank accounts to obtain financial data for underwriting purposes.

Once approved, applicants receive the TomoCredit Mastercard. The goal is to bring “millions of individuals that lack a credit score into the financial system, allowing a diverse group of consumers the opportunity to better position themselves as qualified candidates for mortgages, auto loans, or other major life purchases,” the company said.

TomoCredit has already pre-approved more than 300,000 customers and expects to issue a total of 500,000 cards by year’s end, according to Kim.

“We’ve grown 10x this year from the beginning of 2021,” Kim said. “Still, this round came together earlier than expected.”

Something that has been surprising to Kim is the interest from a variety of types of consumers.

“In the beginning, we thought international students and immigrants would be most interested in our product,” she told TechCrunch. “But after launching, we’ve realized that so many people can benefit — from gig economy workers to YouTubers to any young person who hasn’t had a chance to build credit yet. The market is way bigger than we even realized.”

In early 2022, the company plans to roll out the Tomo Black card, a product for some of its existing customers that “are showing good performance.” It’s currently testing it with some of its existing user base.

“This is a premium product that can grow with our customers, who we want to retain over the next 10 to 20 years,” Kim said. “We don’t want our product to be a stop-gap solution.”

Image Credits: TomoCredit

The startup plans to use its new capital to do more hiring and enhance features such as weekly autopay and high credit limits in an effort to “boost credit scores faster,” she added. Currently, TomoCredit has about 30 employees, up from 10 at the time of its last raise in February.

“My main focus is recruiting top talent,” Kim said, noting that the company had already hired “some senior people from Wells Fargo.” 

“When we recruit and hire, we care about diversity,” she added. “We’re building products for people who have been traditionally underserved by major banks. I think to align with our mission, we should embody that in building our team. More than 50% of our execs are female. The entire risk team is female. We are diverse in terms of gender, age and ethnicity because we want to truly understand our customers and build a product that is inclusive.”

Brian Dixon, partner at Kapor Capital, points out that there are about 45 million people in the U.S. who should have credit scores, but cannot take out a loan, get a credit card, or apply for a mortgage. And that number is only increasing.

“When we learned that Kristy experienced these issues firsthand when she moved to the United States and thoughtfully figured out a way to circumvent the predatory and broken credit card system, it deepened our conviction in her and the product itself,” he wrote via email.

Dixon believes that TomoCredit’s model of not charging the user makes it a “safe and affordable alternative” to what is in the market.

“Their mission aligns with our thesis of closing gaps of access and opportunity in the credit space at large as well,” he added.

#finance, #fintech, #funding, #fundings-exits, #kapor-capital, #payments, #recent-funding, #san-francisco, #startup, #startups, #tomocredit, #venture-capital

Logistics startup Stord raises $90M in Kleiner Perkins-led round, becomes a unicorn and acquires another company

When Kleiner Perkins led Stord’s $12.4 million Series A in 2019, its founders were in their early 20s and so passionate about their startup that they each dropped out of their respective schools to focus on growing the business.

Fast-forward two years and Stord — an Atlanta-based company that has developed a cloud supply chain — is raising more capital in a round again led by Kleiner Perkins.

This time, Stord has raised $90 million in a Series D round of funding at a post-money valuation of $1.125 billion — more than double the $510 million that the company was valued at when raising $65 million in a Series C financing just six months ago.

In fact, today’s funding marks Stord’s third since early December of 2020, when it raised its Series B led by Peter Thiel’s Founders Fund, and brings the company’s total raised since its 2015 inception to $205 million.

Besides Kleiner Perkins, Lux Capital, D1 Capital, Palm Tree Crew, BOND, Dynamo Ventures, Founders Fund, Lineage Logistics and Susa Ventures also participated in the Series D financing. In addition, Michael Rubin, Fanatics founder and founder of GSI Commerce; Carlos Cashman, CEO of Thrasio; Max Mullen, co-founder of Instacart; and Will Gaybrick, CPO at Stripe, put money in the round.

Founders Sean Henry, 24, and Jacob Boudreau, 23, met while Henry was at Georgia Tech and Boudreau was in online classes at Arizona State (ASU) but running his own business, a software development firm, in Atlanta.

Over time, Stord has evolved into a cloud supply chain that can give companies a way to compete and grow with logistics, and provides an integrated platform “that’s available exactly when and where they need it,” Henry said. Stord combines physical logistics services such as freight, warehousing and fulfillment in that platform, which aims to provide “complete visibility, rapid optimization and elastic scale” for its users.

About two months ago, Stord announced the opening of its first fulfillment center, a 386,000-square-foot facility, in Atlanta, which features warehouse robotics and automation technologies. “It was the first time we were in a building ourselves running it end to end,” Henry said.

And today, the company is announcing it has acquired Connecticut-based Fulfillment Works, a 22-year-old company with direct-to-consumer (DTC) experience and warehouses in Nevada and in its home state.

With FulfillmentWorks, the company says it has increased its first-party warehouses, coupled with its network of over 400 warehouse partners and 15,000 carriers.

While Stord would not disclose the amount it paid for Fulfillment Works, Henry did share some of Stord’s impressive financial metrics. The company, he said, in 2020 delivered its third consecutive year of 300+% growth, and is on track to do so again in 2021. Stord also achieved more than $100 million in revenue in the first two quarters of 2021, according to Henry, and grew its headcount from 160 people last year to over 450 so far in 2021 (including about 150 Fulfillment Works employees). And since the fourth quarter is often when people do the most online shopping, Henry expects the three-month period to be Stord’s heaviest revenue quarter.

For some context, Stord’s new sales were up “7x” in the second quarter of 2020 compared to the same period last year. So far in the third quarter, sales are up almost 10x, according to Henry.

Put simply, Stord aims to give brands a way to compete with the likes of Amazon, which has set expectations of fast fulfillment and delivery. The company guarantees two-day shipping to anywhere in the country.

“The supply chain is the new competitive battleground,” Henry said. “Today’s buying expectations set by Amazon and the rise of the omni-channel shopper have placed immense pressure on companies to maintain more nimble and efficient supply chains… We want every company to have world-class, Prime-like supply chains.”

What makes Stord unique, according to Henry, is the fact that it has built what it believes to be the only end-to-end logistics network that combines the physical infrastructure with software.

That too is one of the reasons that Kleiner Perkins doubled down on its investment in the company.

Ilya Fushman, Stord board director and partner at Kleiner Perkins, said even at the time of his firm’s investment in 2019, that Henry displayed “amazing maturity and vision.”

At a high level, the firm was also just drawn to what he described as the “incredibly large market opportunity.”

“It’s trillions of dollars of products moving around with consumer expectation that these products will get to them the same day or next day, wherever they are,” Fushman told TechCrunch. “And while companies like Amazon have built amazing infrastructure to do that themselves, the rest of the world hasn’t really caught up… So there’s just amazing opportunity to build software and services to modernize this multitrillion-dollar market.”

In other words, Fushman explained, Stord is serving as a “plug and play” or “one stop shop” for retailers and merchants so they don’t have to spend resources on their own warehouses or building their own logistics platforms.

Stord launched the software part of its business in January 2020, and it grew 900% during the year, and is today one of the fastest-growing parts of its business.

“We built software to run our logistics and network of hundreds of warehouses,” Henry told TechCrunch. “But if companies want to use the same system for existing logistics, they can buy our software to get that kind of visibility.”

#atlanta, #cloud, #e-commerce, #ecommerce, #funding, #fundings-exits, #ilya-fushman, #kleiner-perkins, #logistics, #ma, #recent-funding, #startup, #startups, #stord, #supply-chain, #venture-capital

SoftBank’s latest proptech bet is leading Pacaso’s $125M Series C

Less than six months after raising $75 million, Pacaso — a real estate platform which aims to help people buy and co-own a second home — announced today that it has raised $125 million at a $1.5 billion valuation.

SoftBank Vision Fund 2 led the Series C funding round for Pacaso, which essentially went from “launch to unicorn” in five months earlier this year and is pronounced like Picasso. New backers Fifth Wall and Gaingels also participated in the financing, along with existing backers Greycroft, Global Founders Capital, Crosscut and 75 & Sunny Ventures. (Sunny Ventures is Pacaso co-founder Spencer Rascoff’s venture firm). With the latest round, Picasso has now raised a total of $215 million in equity funding since its 2020 inception. It also secured $1 billion in debt financing earlier this year.

The fully distributed startup launched its platform in October of last year and already has an annualized revenue run rate of $330 million, according to CEO and co-founder Austin Allison — a feat which quite frankly seems remarkable. The company currently manages nearly $200 million in real estate on its platform, and in the second quarter, its website and mobile app saw a combined 1.8 million visits, up 196% from the first quarter. It’s currently serving owners “in the hundreds.”

Former Zillow executives Allison and Rascoff came up with the concept of Pacaso after leaving Zillow together about two years ago. (Publicly traded Zillow today has a market cap of $24 billion.) 

With a unique co-ownership model made possible via the creation of a property-specific LLC, the company aims to reduce the cost and hassle of second home ownership. It also gives vacation homeowners an alternative option to renting out their property.

Pacaso distinguishes its model from the age-old concept of timeshares, which sell the right to use a fixed amount of time in a condo or hotel. Pacaso aims to bring together a small group of co-owners to purchase a share of a single-family home and “enjoy ongoing access throughout the year.”

The way it works is that Pacaso purchases a home either outright or shares in a home. The company then partners with local real estate agents to market the properties. It then sells shares in the home — from one-eighth of the home to a greater percentage.

Pacaso holds a brokerage license in about 25 top second home markets such as Napa, Lake Tahoe, Palm Springs, Malibu and Park City. It recently expanded to its first market outside of the U.S. — Spain. Buyers can view curated listings on the startup’s website, which includes active listings, as well as previews of homes under consideration for purchase based on buyer demand.

In addition to curating the listings, Pacaso also offers integrated financing, “upscale” interior design, professional property management and proprietary scheduling technology.

In January of this year, Pacaso had 30 employees. Today, it has over 120, according to Allison.

It’s important to note that while Pacaso one day aspires to offer homes that are affordable to a broader segment of the population, Allison acknowledges that currently, the homes available on its platform are “very much” luxury, or higher price, homes.

As for what markets it plans to enter next, he said that will be based on customer feedback. For now, Allison said, 65% of Pacaso’s customers are first-time second homeowners and 25% of are non-white or identify as LGBTQ.

SoftBank Investing Partner Lydia Jett says she was drawn to Pacaso for both professional and personal reasons.

For one thing, she says that when she was growing up, her family owned one-tenth of a “modest” beach house on the coast of Oregon.

“This asset that should be an investment, and source of joy actually had an incredible amount of friction, pain and unexpected cost,” Jett told TechCrunch. “It was a difficult asset to make liquid.”

The friction and pain she referred to included debates around scheduling, capital investments and tension when one of the co-owners needed liquidity but none of the others wanted to buy them out.

Part of the pain involved many of the the things that Pacaso is trying to solve for, Jett believes. By managing the whole co-ownership process, owners don’t have to deal with the “headaches” of maintenance, furnishings and scheduling respective vacations, among other things.

“We’ve designed  a very innovative scheduling solution we call SmartStay, which empowers a calendar to be shared equitably among the ownership group so that each co-owner has fair and equitable access to the property all times of the year,” Allison told TechCrunch

In other words, Picasso is effectively an intermediary between the co-owners, something Jett makes it a very attractive model.

Also, she said, SoftBank was drawn to the opportunity to “create a whole new category of home ownership.”

“This is something that fundamentally can enrich millions of people’s lives,” she told TechCrunch, “and help them realize that dream of co-ownership.”

#apps, #austin-allison, #funding, #fundings-exits, #pacaso, #proptech, #real-estate, #recent-funding, #softbank-vision-fund-2, #spencer-rascoff, #startup, #startups, #venture-capital

Truepic, which just raised $26M in a Microsoft-led round, aims to verify the authenticity of photos and videos

Truepic, a digital image verification software provider, has raised $26 million in a Series B funding round led by M12, Microsoft’s venture fund.

Adobe, Sony Innovation Fund by IGV, Hearst Ventures and individuals from Stone Point Capital also participated in the financing, which brings San Diego-based Truepic’s total raised since its 2015 inception to $36 million.

Rather than trying to detect what is fake, Truepic says its patented “secure” camera technology proves what is real. The startup’s technology acquires “provenance” data (such as origin, contents and metadata) about photos and videos and uses cryptography to protect the images from tampering before they reach the intended recipients. 

As such, the company says its software can authenticate where photos were taken and prove that they were not manipulated since there are an increasing number of deceptive photos and personal information that can be purchased on the Dark Web, social media and via software that can change the metadata of an image’s time or location.

“Our approach is unique in that we are verifying the authenticity of content at the point it is captured, which is also referred to as ‘provenance-based media authentication’ versus detecting anomalies or edits post-capture,” Truepic CEO Jeff McGregor told TechCrunch. “We believe that detection of fake images and videos will not be viable or scalable. Provenance-based media authentication is the most promising approach to universal visual trust online.”

Truepic’s camera technology is software-based, and runs on mobile devices. Photos and videos captured through its camera are cryptographically assured to be unedited, original images, according to McGregor, with “trusted” metadata such as time, date and location.  

In particular, Truepic’s technology — for which it has 13 patents — has been popular among an increasing number of financial services companies, McGregor said. Insurance companies, for example, are using it to verify claims remotely. This has been particularly meaningful during the COVID-19 pandemic, especially in its early days when in-person interaction was avoided at all costs. But it also has a number of other use cases, he said.

The company must be doing something right. Its technology is used by over 100 enterprises, such as Equifax, EXL Service Inc, Ford Motor Company, Accion Opportunity Fund and Palomar. 

And last year, Truepic says its revenues grew by over 300% thanks to “dramatic client growth” across the insurance, banking, automotive, peer-to-peer commerce, project management and international development industries. McGregor declined to reveal hard revenue figures, though, so it’s hard to know just how significant 300% revenue growth is. He added that the company is intentionally not yet profitable as it is currently focused on speed of distribution for its core technology. 

The use cases for Truepic’s technology, according to McGregor, are quite broad given how pervasive untrusted photos and videos are. Its customers include any organization that is ingesting digital photo or video content, and requires a high level of trust in that content. For example, it works with insurance companies, banks, peer to peer commerce, online marketplaces, real estate and franchise organizations, warranty providers and automotive companies, among others. Generally, companies with platforms that rely on visual media — such as home rental, news media, online dating, social media, e-commerce, sharing economy, traditional media — can benefit from Truepic’s technology, according to McGregor.

“We imagine a world where the origin and authenticity of all digital content is verifiable, allowing humans to gain higher trust in what they view online,” he said.

M12 Principal James Wu said that the number of deep-fake videos and synthetic media online is growing at an exponential rate. 

“Used nefariously, manipulated media can result in negative political discourse, reputational consequences, and fraudulent claims,” he wrote via email. “The pervasiveness of synthetic media is a growing business risk for corporations — especially established brands — and solutions like Truepic will become an integral part of an enterprise’s end-to-end fraud management strategy.”

He went on to describe Truepic as a “pioneer” in provenance technology, which M12 believes is the most reliable way to establish the integrity of the data contained in photo and video files. 

“There has been a great deal of investment in synthetic media, but very few are thinking about the other side of the coin — when synthetic media is used nefariously,” he said. “Truepic is at the forefront of providing tools to maintain a shared sense of reality online.”

The company plans to use its new capital in part toward speeding up the release of a new product, Truepic Lens, that will power “trusted” image capture in third-party applications, “regardless of industry or use-case,” McGregor said.

“This will create a single integration point for any customer that requires trusted media to run their service,” he said. 

It also plans to use the new capital to increase distribution for its current flagship product, Truepic Vision, a “turnkey” platform for requesting and “instant” reviewing of trusted photos and videos from anywhere in the world.

The company also, naturally, plans to hire. It currently has 50 employees, up from about 25 a year ago. McGregor expects Truepic’s team will double to 100 over the next 18 months. 

#funding, #fundings-exits, #m12, #microsoft-m12, #recent-funding, #san-diego, #software, #startup, #startups, #truepic, #venture-capital

SpotOn raises $300M at a $3.15B valuation and acquires Appetize

Last year at this time, SpotOn was on the brink of announcing a $60 million Series C funding round at a $625 million valuation.

Fast forward to almost exactly one year later, and a lot has changed for the payments and software startup.

Today, SpotOn said it has closed on $300 million in Series E financing that values the company at $3.15 billion — more than 5x of its valuation at the time of its Series C round, and significantly higher than its $1.875 billion valuation in May (yes, just three and a half months ago) when it raised $125 million in a Series D funding event.

Andreessen Horowitz (a16z) led both the Series D and E rounds for the company, which says it has seen 100% growth year over year and a tripling in revenue over the past 18 months. Existing investors DST Global, 01 Advisors, Dragoneer Investment Group, Franklin Templeton and Mubadala Investment Company too doubled down on their investments in SpotOn, joining new backers Wellington Management and Coatue Management. Advisors Douglas Merritt, CEO of Splunk, and Mike Scarpelli, CFO of Snowflake, also made individual investments as angels. With the new capital, SpotOn has raised $628 million since its inception.

The latest investment is being used to finance the acquisition of another company in the space — Appetize, a digital and mobile commerce payments platform for enterprises such as sports and entertainment venues, theme parks and zoos. SpotOn is paying $415 million in cash and stock for the Los Angeles-based company.

Since its 2017 inception, SpotOn has been focused on providing software and payments technology to SMBs with an emphasis on restaurants and retail businesses. The acquisition of Appetize extends SpotOn’s reach to the enterprise space in a major way. Appetize will go to market as SpotOn and will work to grow its client base, which already includes an impressive list of companies and organizations including Live Nation, LSU, Dodger Stadium and Urban Air. 

In fact, Appetize currently covers 65% of all major league sports stadiums, specializing in contactless payments, mobile ordering and menu management. So for example, when you’re ordering food at a game or concert, Appetize’s technology makes it easier to pay in a variety of contactless ways through point of sale (POS) devices, self-service kiosks, handheld devices, online ordering, mobile web and API integrations.

Image Credits: SpotOn

SpotOn is taking on the likes of Square in the payments space. But the company says its offering extends beyond traditional payment processing and point-of-sale software. Its platform aims to give SMBs the ability to run their businesses “from building a brand to taking payments and everything in between.” SpotOn’s goal is to be a “one-stop shop” by incorporating tools that include things such as custom website development, scheduling software, marketing, appointment scheduling, review management, analytics and digital loyalty.

The combined company will have 1,600 employees — 1,300 from SpotOn and 300 from Appetize. SpotOn will now have over 500 employees on its product and technology team, according to co-founder and co-CEO Zach Hyman. It will also have clients in the tens of thousands, a number that SpotOn says is growing by “thousands more every month.”

The acquisition is not the first for SpotOn, which also acquired SeatNinja earlier this year.

But in Appetize it saw a company that was complementary both in its go-to-market and tech stacks, and a “natural fit.”

SMEs are going to benefit from the scalable tech that can go with them, including things like kiosks and offline modes, and for the enterprise clients of Appetize, they’re going to be able to leverage products like sophisticated loyalty programs and extended marketing capabilities,” Hyman told TechCrunch. 

SpotOn was not necessarily planning to raise another round so soon, Hyman added, but the opportunity came up to acquire Appetize.

“We spent a lot of time together, and it was too compelling to pass up,” he told TechCrunch.

For its part, Appetize — which has raised over $77 million over its lifetime, according to Crunchbase — too saw the combination as a logical one.

“It was important to us to retain a stake in the business. We were not looking to cash out,” said Appetize CEO Max Roper. “We are deeply invested in growing the business together. It’s a big win for our team and our clients over the long term. This is a rocketship that we are excited to be on.” 

No doubt that the COVID-19 pandemic only emphasized the need for more digital offerings from small businesses to enterprises alike.

“There has been a high demand for our services and now as businesses are faced with a Covid resurgence, no one is closing down,” Hyman said. “So they see a responsibility to install the necessary technology to properly run their business.”

One of the moves SpotOn has made, for example, is launching a vaccination alert system in its reservation management software platform to make it easier for consumers to confirm they are vaccinated for cities and states that have those requirements.

Clearly, a16z General Partner David George too was bullish on the idea of a combined company.

He told TechCrunch that the two companies fit together “extremely nicely.”

“It felt like a no-brainer for us to want to lead the round, and continue to support them,” George said.

Since first investing in SpotOn in May, the startup’s growth has “exceeded” a16z’s expectations, he added.

“When companies are growing as fast as it is organically, they don’t need to rely on acquisitions to fuel growth,” he said. “But the strategic rationale here is so strong, that the acquisition will only turbocharge what is already high growth.”

While the Series E capital is primarily funding the acquisition, SpotOn continues to double down on its product and technology.

“This is our time to shine and invest in the future with forward thinking technology,” Hyman told TechCrunch. “We’re thinking about things like how are consumers going to be ordering their beer at a Dodgers game in three years? Are they going to be standing in line for 25 minutes or are they going to be interacting and buying merchandise in other unique ways? Those are the things we’re looking to solve for.”

#andreessen-horowitz, #appetize, #david-george, #dragoneer-investment-group, #dst-global, #finance, #fintech, #franklin-templeton, #funding, #fundings-exits, #instagram, #los-angeles, #ma, #mobile-web, #mubadala-investment-company, #online-payments, #payment-processing, #payments, #recent-funding, #saas, #san-francisco, #splunk, #spoton, #startup, #startups, #venture-capital

Startup insurance provider Vouch raises $90M, now valued at $550M

Vouch, a provider of business insurance to startups and high-growth companies, announced today it has raised $90 million in new funding.

The $90 million figure was raised across two rounds: a $60 million Series C co-led by SVB Capital (a subsidiary of Silicon Valley Bank) and Ribbit Capital that values the company at $550 million, and a previously unannounced $30 million Series B1 led by Redpoint Ventures.

With the latest financing, San Francisco-based Vouch has now raised a total of $160 million since its 2018 inception. Other investors include Allegis Group, Sound Ventures and SiriusPoint.

While there are many insurance technology companies out there that serve consumers, there are far fewer that offer it to companies, much less startups. Vouch describes itself as “a new kind of insurance platform” for startups that offers fully digital, “tailored coverage that takes minutes to activate.”

Over the past year, Vouch has seen impressive growth. The company declined to reveal hard revenue figures, but said it saw “7x” increase in its customer base year over year and currently protects over $5.7 billion in risk across thousands of policies. Today, Vouch has more than 1,600 clients, including Pipe, Middesk, Neighbor and Routable. It is also the “preferred” business insurance provider to the customers of Silicon Valley Bank, Brex, Carta and WeWork. Y Combinator too also refers Vouch to its portfolio companies. 

To Vouch co-founder and CEO Sam Hodges, the ability to attract some of the highest-profile businesses in the startup world speaks to the company’s understanding of the startup ecosystem. 

“It’s our responsibility to meet startup founders where they are, and give startups flexibility as they navigate changing laws, regulations and the virtual and physical locations of their businesses,” he said.

Like many other companies, Vouch had to shift its model during the pandemic to adapt to the different types of emerging risks businesses have faced. For example, last year, Vouch saw a change in where its startup clients’ teams were distributed. Before the pandemic, nearly 30% of the teams were remote. During the pandemic, that figure has shifted to over 53%. As a result, Vouch developed a broader range of insurance coverages to adapt to the “new normal.”

Included in its new line of proprietary products and services aimed at startups are: work from anywhere coverage, broader cyber coverages and embedded insurance. It also expanded its underwriting capabilities to serve early-stage to growth-market startups.

In particular, the work from anywhere coverage is in direct response to the pandemic-related shift in remote work and can insure up to $500,000 per occurrence and can include a specified property owned by a startup regardless of the location of that property.

One major differentiator for Vouch, said Hodges, is that it is now the only business insurance provider that has its own insurance carrier, which means the company backs its own policies.

“This capability means we have a lot of control over how we build and underwrite our policies — which translates into superior coverage and a better experience for our clients,” he said.

 Hodges co-founded Vouch with Travis Hedge three years ago after seeing how challenging it could be for a company to get the business insurance it needs to start and then scale.

The goal is to make it as easy as possible to onboard new customers and personalize the coverage as much as possible based on each company’s needs based on what they do, their customer base, stage of growth and the founder’s threshold for risk.

“A typical client can get a quote and bind their coverage online in under 10 minutes, without any phone calls or paperwork,” he told TechCrunch. “Vouch also has many coverage features that are uniquely geared for startups. For example, our directors and officers coverage includes a cap table coverage feature meant specifically to protect startups.”

Vouch looks at startups that need business insurance on a case by case basis, Hodges added. 

For example, it asks questions like, “Does an e-commerce company handle a very limited amount of client-sensitive information?” If so, it could make sense that it has a lower cyber insurance coverage limit and pay less for its policy. 

Conversely, if a startup is trying to raise money, it might need to invest more in Vouch’s directors and officers insurance to make sure it is covered should disputes arise in the future. 

Looking ahead, Hodges said the new capital would go toward continued investment in technical capabilities, an expansion of its product offerings, more hiring and building embedded insurance for its partners.

With regard to the embedded capabilities, within the next 12 months, all of the company’s partners’ customers will be able to purchase Vouch insurance directly from those partners’ websites. Vouch’s headcount has more than doubled, from 55 employees in September 2020 to 125 full-time employees presently, and Hodges expects that will continue to grow.

Greg Becker, president and CEO of SVB Financial Group, said that Vouch’s mission aligns with SVB’s in that they both aim to “empower the innovation economy.” 

That’s what Vouch is doing today, helping startups and tech innovators mitigate their risks as they grow,” he wrote via email. “We are proud to co-lead Vouch’s latest funding round to give startups access to the insurance they need as they add headcount, increase their customer base, or raise funding rounds of their own.”

#digital-insurance, #finance, #funding, #fundings-exits, #insurance-technology, #insurtech, #recent-funding, #ribbit-capital, #san-francisco, #startup, #startups, #svb-capital, #venture-capital, #vouch

Varo Bank raises massive $510M Series E at a $2.5B valuation as it eyes the public markets

Varo Bank, which last year became the first U.S. neobank to be granted a national bank charter, announced this morning it has raised a staggering $510 million in a Series E funding round at a $2.5 billion valuation.

The massive “oversubscribed” financing comes nearly seven months after the fintech startup raised $63 million in a round led by NBA star Russell Westbrook, who also joined the startup as an advisor focused on the direction of Varo Bank’s programs aimed at underserved communities, including communities of color. 

Varo declined to reveal any hard revenue figures but did note that in the 13 months since obtaining its bank charter, the company has doubled its number of opened accounts to four million and tripled its revenue. The latest financing brings the San Francisco-based startup’s total raised to $992.4 million since its 2015 inception, meaning that this round alone effectively amounts to nearly $30 million more than what the company has raised over its lifetime. Varo has previously never disclosed valuation, but it did note that the $2.5 billion valuation figure is up “5x” since May of 2020.

At the time of its last raise, in February, Varo touted 3 million opened accounts. Doing the math we can deduce that the startup has added one million new accounts over the past seven months. At the time of its $241 million Series D last June (that included participation from U2’s Bono), Varo counted nearly 2 million banking and savings accounts.

New investor Lone Pine Capital led the latest round, along with “dozens” of additional new backers, including Declaration Partners, Eldridge, Marshall Wace, Berkshire Partners/Stockbridge and funds and accounts managed by BlackRock. They joined existing investors Warburg Pincus, The Rise Fund, Gallatin Point Capital and HarbourVest Partners. 

Last year, Varo announced it had been granted a national bank charter from the Office of the Comptroller of the Currency (OCC) and secured regulatory approvals from the FDIC and Federal Reserve to open Varo Bank, N.A. — effectively becoming a “real” bank but with no physical branches.

CEO and founder Colin Walsh told TechCrunch that the move had a significant impact on his company’s growth. First off, it effectively eliminated an intermediary.

“Being in the regulated system loop has allowed us to expand our margins considerably,” he said. “We also now have direct access to the payment network so our ability to generate substantial value both to our consumers as well as to our shareholders is becoming more and more apparent.”

Walsh also said that Varo is not yet profitable, but is on its way there. He predicts that Varo will achieve profitability in about two years, or three years after becoming a bank.

“One of the nice things that the charter affords us is that we can actually pursue growth and profitability at the same time,” Walsh said. “It’s very much within that three-year window of when we became a bank.”

Also in the last 13 months, Varo has nearly doubled its employee count to nearly 800 today and expanded into a third hub in Charlotte, North Carolina.

Walsh admits that the raise was not necessarily in the company’s plans.

“We didn’t set out to raise this much money. It was coming in fast and furious and we were at like $510 [million] and I finally said, ‘Ok, enough,’ ” he said. “But the fact that we were able to raise this money without even really trying is evidence of the fact that there’s something happening that is just very culturally relevant in this moment and our success to me is very much about having that kind of impact at scale.”

The executive added that the choice of lead investor did tie in to its eventual plans to go public.

“They’re a very reputable sophisticated crossover investor that invests in high-growth, high-potential private market companies and ultimately work with them to go public,” Walsh told TechCrunch. “It’s definitely on the roadmap for us as I think there’s a ton of value we can create as a public company when the time is right.”

Existing investors, he added, aren’t putting pressure on Varo for that to happen. And so, Walsh predicts any move in that direction will only take place sometime “in the next couple of years.”

He also said that down the line, it’s possible that Varo would explore a global expansion.

Varo launched in 2017 with a mission to become “an all digital, mission-driven, FDIC insured bank designed around the modern American consumer,” Walsh said. Today, the company’s core product offerings include “premium” bank accounts that have no minimum balance requirement or monthly account fee and high-interest savings accounts combined with a suite of “tech-first features” designed to help people save and manage their money.

It recently launched Varo Advance, a short-term line of credit that gives qualifying customers a way to secure a cash advance of up to $100 within its app “in seconds” and Varo Perks cashback rewards. The company also has plans to launch Varo Believe, a credit building credit card program designed to help Varo customers “safely build or repair their credit,” with a flexible security deposit and without fees. 

The new capital will go toward continued investment in its products, risk platform and design, according to Walsh. Varo’s goal is to scale to “tens of millions” of consumers and to become a “loved brand recognized for its social impact mission,” he added.

Since the beginning, the startup has been vocal about its intent to help boost financial inclusion with its offerings that aim to serve marginalized and underserved communities that it says have been historically excluded from traditional financial institutions. For Walsh, that remains important.

“We believe we’re on the cusp of creating what will be an iconic brand that’s doing good in the world,” he said. “I want to be like the ‘Patagonia of banking,’ like where people feel really good about the company and what we’re doing and the impact we’re having on people’s lives.”

Varo Bank competes with a growing number of all-digital banks operating in the U.S., including Chime, Current, N26, Level, Step, Moven, Empower Finance, Dave, GoBank, Aspiration, Stash, Zero and others.

Like many other fintechs, Varo saw a pandemic-related boost in business.

“It’s been a time when many re-evaluated their banking relationships and decided to switch to a digital bank that offers far better value and more convenience than a traditional bank,” Walsh said.

Lone Pine Capital’s David Craver said of his new investment: “What the Varo team has been able to achieve in such a short time in the market is truly remarkable. This is a group of trailblazers who are well on their way to building one of America’s next generation of iconic companies.

Warburg Pincus’ Todd Schell and Varo investor said from day one, his firm was aligned with Walsh’s view that the bank charter was fundamental to a long term sustainable business model.

“In Varo we saw the opportunity to radically redefine a cost structure, introduce new products across a wide variety of categories, and uniquely solve use cases which have historically been out of scope,” Schell wrote via email. “Varo today has all of the pieces to this puzzle, including a next generation banking technology stack, the license to operate and fully derive the benefits of it, and the capital to scale. Varo already serves millions of Americas, but we believe it has the potential to reinvent financial services for tens of millions of people around the world.”

#apps, #colin-walsh, #finance, #fintech, #funding, #fundings-exits, #lone-pine-capital, #neobank, #recent-funding, #startup, #startups, #tc, #varo-bank, #venture-capital

Former head of Mint raises $4.5M for Lean to give gig workers access to financial products

Gig and independent workers have different needs when it comes to financial products than salaried employees at a company.

It’s a challenge that Tilak Joshi, founder of Lean, became acutely aware of during his tenure as head of Mint and years as a product exec at American Express and PayPal.

While the U.S. has seen a major shift in more independent workers in recent years, traditional financial institutions have “failed to keep up,” in his view.

“Seventy percent of independent workers live paycheck to paycheck and 30% are inadequately insured,” he said. “Independent workers will soon become the majority of the US workforce, and the existing conversation, platforms, and institutions need to rapidly evolve to support them.”

Upon leaving Mint in 2020, Joshi founded Lean to support gig workers with a platform that offers access to financial products that he says are “custom built” for their needs. And today, Lean is announcing it has raised $4.5 million in a seed round led by Inspired Capital that included participation from Atelier Ventures, Oceans Ventures and Acequia Capital.

Notably, a slew of marketplace industry operators also put money in the round including DoorDash exec Gokul Rajaram; Instacart co-founder Max Mullen; Manik Gupta, ex-CPO Uber; , Vivek Patel, ex-COO of Postmates), Bird CPO Ryan Fujiu and others. The latest financing brings Lean’s total raised to nearly $6 million to date. Other high-profile angels who have backed the company include Charlie Songhurst, Lightspeed Venture Partners (and former Stripe exec) Justin Overdorff, Coinbase’s Marc Bhargava, and executives from ANGI Homeservices, Coinbase and Plaid. 

“Independent workers see some of the most restrictive financial scenarios of anywhere in the U.S.,” Joshi told TechCrunch. “What workers do to patch up their financial problems is work across various gig marketplaces and when marketplaces try to keep them and pay them incentives, they just figure out how to game the system. It just turns into inefficiency on both sides where marketplaces don’t really have the stability of having a strong workforce they can rely on and workers are also just in a tight spot.”

Lean aims to help independent workers by partnering directly with marketplaces to offer financial products and benefits. The goal is to help marketplaces with worker acquisition and retention by giving gig workers access to “no-cost capital, instant payouts and financial products such as mortgages, “low-to-no-cost borrowing,” HSAs and insurance. 

Lean works with marketplaces of all sizes that employ either 1099 or W2 workers that work in industries such as ride-hailing, courier, healthcare and construction. Joshi said that in addition to boosting worker acquisition and retention, Lean has the potential to “unlock” revenue for marketplaces via financial products and infrastructure rather than through fees to workers. 

Its platform, Joshi said, is designed to be integrated with any marketplace in less than two weeks. Through its marketplace partnerships, Lean expects to be rolling out to “hundreds of thousands” of gig workers across the country over the coming months, according to Joshi.

There’s no cost for marketplaces and no cost for workers. Lean expects to earn revenue through the fees associated with the movement of money via its platform, Joshi said. So far, the startup has inked deals with half a dozen marketplaces, and has another half a dozen in the works.

The company plans to use its new capital to expand its offering and continue to scale across marketplaces.

Mark Batsiyan, partner at Inspired Capital, says he was attracted to Lean because of the team, market timing and approach. 

“There are huge market tailwinds to better serving gig workers, and marketplaces are increasingly searching for better ways to attract and retain their workers,” he wrote via email. “Also, Tilak [Joshi] came to a similar conclusion to us at Inspired: that marketplaces would not build these solutions themselves. They need an intermediary — like Lean — to make financial benefits a turnkey solution.”

Batsiyan also believes that Lean’s B2B2C approach is unique. 

“As a platform, Lean can then leverage its partnerships to achieve much more efficient distribution to the end workers,” he said. 

Earlier this year, Mint’s first product manager raised $4.8 million in seed funding for Monarch, a subscription-based platform that aims to help consumers “plan and manage” their financial lives.

#finance, #fintech, #funding, #gig-workers, #inspired-capital, #lean, #payments, #recent-funding, #startup, #startups, #venture-capital

HoneyBee raises millions to make financial wellness a workplace benefit

HoneyBee, a startup that aims to help companies provide access to financial support for their employees, announced today it has raised $5.7 million in equity in a round led by FFVC.

Resolute Ventures, Afore Capital, Rebalance Capital, K50 and Financial Venture Studio also participated in the financing, along with two-time NBA all-star Baron Davis.

HoneyBee has also secured a $100 million debt facility from CIM, an institutional impact investment manager that provides debt capital for innovation that lends to underserved communities. 

The Los Angeles-based Certified B Corp describes itself as a B2B financial technology company that is on a mission to give employees — and their families — free access to financial support in the workplace as a benefit. That support could come in the form of employer-sponsored “no-cost rainy day funds” and on-demand financial therapy with the goal of “creating a healthier workforce environment.”

Or put even more simply, HoneyBee aims to give HR and DEI leaders that say they are committed to creating an equitable and inclusive culture a way to provide access to financial tools and education to help improve their employees’ financial health.

CEO and co-founder Ennie Lim said she was inspired to start HoneyBee after suffering financial setbacks after her own divorce several years ago.

“My credit was negatively impacted to the point where I found myself unable to get access to any affordable credit,” she recalls. “I wish I had done a lot of things differently, but I didn’t know what I didn’t know, and I was embarrassed to ask for help.”

The experience helped Lim realize the importance of feeling in control of your financial life.

“It affects your self-esteem, happiness and personal relationships and it made me want to help others take control of theirs,” she said.

Lim teamed up with Benny Yiu and Max Zschoch in 2017 to build HoneyBee with that goal in mind.

“We are solving a massive economic disparity and we’re leveling the playing field in the workplace by reducing the financial literacy gap and providing access to credit to people that need it most,” Lim said. “It’s important to acknowledge that people come from different socioeconomic backgrounds. The varying levels of financial illiteracy is an issue we can no longer ignore.”

Image Credits: HoneyBee

A study conducted by Washington University in St. Louis found that 89% of HoneyBee users are people of color, women, or both. During the pandemic, when the need for its offering was even greater, HoneyBee signed over 60 mid-markets companies as customers and is launching with Fortune 500 companies later this year.

The startup’s user growth grew by 225% during the pandemic and the company says it delivered over $2 million in rainy day funds. Meanwhile, its on-demand financial therapy usage increased by 172% over the prior year.

“Amidst this pandemic, when employers were cutting budgets, furloughing, laying off, reducing hours and salaries, we started to see a shift in their buying behavior to address financial health,” Lim said.

Honeybee’s customers include Alameda County Community Food Bank, DC Central Kitchen, Kate Somerville, Community Catalyst of California, Southwest Water Company, Straus Family Creamery, Asian Art Museum, Pasadena Humane Society and Peachtree Health.

NBA star Baron Davis grew up in South Central Los Angeles with his grandmother and says he believes strongly in the startup’s desire to provide access to affordable credit.

“Financial literacy is a barbed wire for people like me. It is essential for companies to provide equitable access to financial support for their employees,” he wrote via email. “Financial access alleviates stress in the workplace especially when they are working hard to make ends meet to support their family. Providing easy access to money and education will result in a happier, healthier, productive workforce.”

FFVC Partner AJ Plotkin said his firm likes that the structure of the product “solves a serious access problem for customers who need a bridge for short-term, emergency needs, in a way that is not burdensome for the employee or the employer.”

The company plans to use its new capital in part to grow its sales, engineering, and customer success team. 

#ffvc, #finance, #fintech, #funding, #fundings-exits, #honeybee, #recent-funding, #startup, #startups, #venture-capital

Jetty raises $23M to help give renters more payment flexibility

Jetty, a fintech company which aims to give renters flexibility when paying rent, has raised $23 million in a funding round co-led by Citi and Flourish Ventures.

The financing brings Jetty’s total raised since its 2016 inception to $78 million. Other investors participating in the latest growth round include Credit Ease and K5. Previous backers include Farmers Insurance Group, Khosla and Ribbit Capital, among others.

The 100-person New York City-based startup has come up with a way to help renters make rent on time with an offering that resembles the ‘buy now, pay later’ (BNPL) model that is increasingly used by consumers at the point of sale, online and in person. 

In a nutshell, renters can pay their rent when it’s due and then have up until the 24th of the month to pay the money back to Jetty  — either in a lump sum or via installments. They don’t pay interest charges or late fees, but rather a monthly subscription fee ranging from $15 to $25, depending on the renter’s risk profile. If the renter fails to pay back the money during the agreed upon time, they will not be able to borrow more for the following month.

The monthly fee is “far lower” than any potential late fee if the rent is not paid on time, said co-founder and CEO Mike Rudoy.

“Around 50% of the average renter’s paycheck is going to rent. So this is the largest expense of any renter, on a given month,” he said. “And so you would expect that there would be some type of financial services product that would give them the flexibility that they need to come up with the money on time in such a way that they weren’t penalized.”

The offering is more of a cousin to traditional BNPL, he said, than actual BNPL.

“We will pay the rent on behalf of the renter in full on the first of the month, giving property managers the money they need when they need it,” Rudoy explained. “Renters get 24 days to pay it back on a schedule that suits their needs.”

To launch Jetty Rent, the company partnered with Cortland, a large real estate investment, development and management company, to roll out the offering in beta to residents across a portfolio of properties.

Now, the startup is launching the offering to the public. Jetty Rent is the newest product on the startup’s platform, which also offers “low cost” renters insurance as well as security deposit replacement.

“The mission of the company is to make renting more affordable and flexible,” Rudoy said. “And we are a financial services platform whereby every product that we have launched is meant to both provide value to both property managers as well as renters.”

With the move, Jetty is evolving from being an insurtech to also a lender, said Rudoy. The company is providing the loans through Cross River Bank.

“We are working to bring some additional credit and lending prowess to the business given the fact it has historically been considered an insurtech company,” he told TechCrunch.

The fact that the company offers all three products to property managers gives it a competitive edge, according to Rudoy.

“This makes us different from other financial services companies attacking the same space and problem set,” he told TechCrunch. “We’re the only one that has both a security deposit alternative and flexible rent product under the same roof. It makes the choice to work with us much easier if you’re a property manager, from an integration and onboarding perspective. It means fewer different brands in front of renters as well.”

The renters pay for all the products and the property managers are partners in the distribution of the products.

Currently, the company has agreements with property owners and managers that operate more than 2.2 million rental units across the country. Since starting to build its property partner network in 2017, Jetty has seen 193% average year over growth in contracted units, according to co-founder Alex Vlasto. Besides Cortland, it also works with AMLI Residential, for example.

Emmalyn Shaw, managing partner of Flourish Ventures, notes that over 70% of Americans live paycheck to paycheck.

“Stable housing is a critical component in helping them achieve financial security,” she said.

Jetty, Shaw added, is the only company “that extends beyond a single solution to embed a rich and differentiated set of financial offerings” including rental insurance, security deposit alternatives and now rent flexibility. 

“Through its unique consumer insights, differentiated pricing, increased consumer loyalty, Jetty has achieved a significant competitive advantage,” she wrote via email. “Moreover, their consumer reach through top property management entities like Cortland is unparalleled.”

As of late, other startups that have come up with new technology to make the lives of renters easier have also raised money. Sugar, a startup that aims to turn apartment buildings into “interactive communities,” recently closed on $2.5 million in seed funding.  And, RentCheck, a startup that has built out an automated property inspection platform, recently raised $2.6 million in seed money.

#citi, #finance, #fintech, #funding, #jetty, #new-york-city, #real-estate, #recent-funding, #startup, #startups, #venture-capital

Fintech startup Jeeves raises $57M, goes from YC to $500M valuation in one year

Last summer, Jeeves was participating in Y Combinator’s summer batch as a fledgling fintech.

This June, the startup emerged from stealth with $31 million in equity and $100 million in debt financing. 

Today, the company, which is building an “all-in-one expense management platform” for global startups, is announcing that it has raised a $57 million Series B at a $500 million valuation. That’s up from a valuation of just north of $100 million at the time of Jeeves’ Series A, which closed in May and was announced in early June.

While the pace of funding these days is unlike most of us have ever seen before, it’s pretty remarkable that Jeeves essentially signed the term sheet for its Series B just two months after closing on its Series A. It’s also notable that just one year ago, it was wrapping up a YC cohort.

Jeeves was not necessarily looking to raise so soon, but fueled by its growth in revenue and spend after its Series A, which was led by Andreessen Horowitz (a16z), the company was approached by dozens of potential investors and offered multiple term sheets, according to CEO and co-founder Dileep Thazhmon. Jeeves moved forward with CRV, which had been interested since the A and built a relationship with Thazhmon, so it could further accelerate growth and launch in more countries, he said.

CRV led the Series B round, which also included participation from Tencent, Silicon Valley Bank, Alkeon Capital Management, Soros Fund Management and a high-profile group of angel investors including NBA stars Kevin Durant and Andre Iguodala, Odell Beckham Jr. and The Chainsmokers. Notably, the founders of a dozen unicorn companies also put money in the Series B including (but not limited to) Clip CEO Adolfo Babatz; QuintoAndar CEO Gabriel Braga; Uala CEO Pierpaolo Barbieri, BlockFi CEO Zac Prince; Mercury CEO Immad Akhund; Bitso founder Pablo Gonzalez; Monzo Bank’s Tom Blomfield; Intercom founder Des Traynor; Lithic CEO Bo Jiang as well as founders from UiPath, Auth0, GoCardless, Nubank, Rappi, Kavak and others.


The “fully remote” Jeeves describes itself as the first “cross country, cross currency” expense management platform. The startup’s offering was live in Mexico and Canada and today launched in Colombia, the United Kingdom and Europe as a whole. 

Thazhmon and Sherwin Gandhi founded Jeeves last year under the premise that startups have traditionally had to rely on financial infrastructure that is local and country-specific. For example, a company with employees in Mexico and Colombia would require multiple vendors to cover its finance function in each country — a corporate card in Mexico and one in Colombia and another vendor for cross-border payments.

Jeeves claims that by using its platform’s proprietary Banking-as-a-Service infrastructure, any company can spin up their finance function “in minutes” and get access to 30 days of credit on a true corporate card (with 4% cash back), non card payment rails, as well as cross-border payments. Customers can also pay back in multiple currencies, reducing FX (foreign transaction) fees.

For example, a growing business can use a Jeeves card in Barcelona and pay it back in euros and use the same card in Mexico and pay it back in pesos, reducing any FX fees and providing instant spend reconciliation across currencies. 

Thazhmon believes that the “biggest thing” the company is building out is its own global BaaS layer, that sits across different banking entities in each country, and onto which the end user customer-facing Jeeves app plugs into.

Put simply, he said, “think of it as a BaaS platform, but with only one app — the Jeeves app — plugged into it.”

Image Credits: Jeeves

The startup has grown its transaction volume (GTV) by more than 5,000% since January, and both revenue and spend volume has increased more than 1,100% (11x) since its Series A earlier this year, according to Thazhmon.

Jeeves now covers more than 12 currencies and 10 countries across three continents. Mexico is its largest market. Jeeves is currently beta testing in Brazil and Chile and Thazhmon expects that by year’s end, it will be live in all of North America and Europe. Next year, it’s eyeing the Asian market, and Tencent should be able to help with that strategically, he said.

“We’re building an all-in-one expense management platform for startups in LatAm and global markets — cash, corporate cards, cross-border — all run on our own infrastructure,” Thazhmon told TechCrunch. “Our model is very similar to that of Uber’s launch model where we can launch very quickly because we don’t have to rebuild an entire infrastructure. When we launch in countries, we actually don’t have to rebuild a stack.”

Jeeves’ user base has been doubling every 60 days and now powers more than 1,000 companies across LatAm, Canada and Europe, including Bitso, Kavak, RappiPay, Belvo, Runa, Moons, Convictional, Muncher, Juniper, Trienta, Platzi, Worky and others, according to Thazhmon. The company says it has a current waitlist of over 15,000.

Jeeves plans to use its new capital toward its launch in Colombia, the U.K. and Europe. And, of course, toward more hiring. It’s already doubled its number of employees to 55 over the past month.

Former a16z partner Matt Hafemeister was so impressed with what Jeeves is building that in August he left the venture capital firm to join the startup as its head of growth. In working with the founders as an investor, he concluded that they ranked “among the best founders in fintech” he’d ever interacted with.

The decision to leave a16z also related to Jeeves’ inflection point, Hafemeister said. The startup is nearly doubling every month, and had already eclipsed year-end goals on revenue by mid-year.

It is evident Jeeves has found early product market fit and, given the speed of execution, I see Jeeves establishing itself as one of the most important fintech companies in the next few years,” Hafemeister told TechCrunch. “The company is transitioning from a seed company to a Series B company very quickly, and being able to help operationalize processes and play a role in their growth and maturity is an incredible opportunity for me.”

CRV General Partner Saar Gur (who is also an early investor in DoorDash, Patreon and Mercury) said he was blown away by Jeeves’ growth and how it has been “consistently hitting and exceeding targets month over month.” Plus, early feedback from customers has been overwhelmingly positive, Gur said.

“Jeeves is building products and infrastructure that are very difficult to execute but by doing the ‘hard things’ they offer incredible value to their customers,” he told TechCrunch. “We haven’t seen anyone build from the ground up with global operations in mind on day one.”

#a16z, #apps, #baas, #crv, #dileep-thazhmon, #finance, #fintech, #funding, #fundings-exits, #jeeves, #payments, #recent-funding, #saar-gur, #sherwin-gandhi, #startup, #startups, #venture-capital, #y-combinator, #yc

Minnesota twins raise $3M to increase accessibility to disability care

Having a loved one with specialized care needs is incredibly challenging, but not something that people who have never had to deal with the issue would necessarily quite understand.

For anyone who has had to help care for someone with special needs, the lack of options out there to navigate finding access to care providers is almost shocking.

Twin sisters Melanie Fountaine and Melissa Danielsen know the problem firsthand, having helped take care of their brother, who had a developmental disability and severe epilepsy, for years.

“We saw the struggle for our family to find reliable care,” Danielsen told TechCrunch.

After he passed away 12 years ago at the age of 29, the siblings decided they wanted to dedicate their careers to making disability care accessible to families with complex care needs. They founded Josh’s Place, a company that provided group home accommodations and other services to adults across Minnesota, which ended up being acquired by REM Minnesota in early 2020.

The pair then came up with the concept behind Joshin, a digital care platform that aims to connect care providers to families with specialized care needs. (Both companies were named after the sisters’ brother, who was named Josh). And today, that startup is announcing it has closed on a $3 million seed round of funding co-led by Anthemis Group and The Autism Impact Fund.

Joshin started out as an app that creates a care plan that helps it match families to a “carefully vetted” trained caregiver. It has evolved to also include a corporate benefits program with Joshin partnering with companies who want to offer an inclusive care benefit to their employees.

Image Credits: Joshin

An estimated one in five families have complex health needs, ranging from children with neurodivergence to dependent adults with developmental and physical disabilities. The COVID-19 pandemic has only highlighted the need for support, making it even more difficult to find necessary care. As such, many people (most of which are women) are finding they have to leave jobs to become full-time caregivers.

“For too long, people with special health needs and their families have been underserved and had fragmented access to disability care providers,” said CEO Danielsen.

COO Fountaine says that historically the care economy has focused on children under 12, or adults over 65 — childcare and eldercare, respectively.

“Joshin really is positioned to be the leader in that huge age gap that’s out there,” she said. “We work with people at all stages of life, and I think it’s unfortunate that until now, that’s been missing from the conversation. 

The company plans to use its new capital in part to grow its network of care providers. It also aims to expand its corporate benefits program.

“We’re continuing to scale our technology to lessen the burden of caregiving responsibilities for employees and their families,” added Danielsen.

Over the past 12 months, Joshin’s community of members and caregivers has grown 200%. With the new funding, the startup plans to expand its services to Los Angeles and Seattle. It is currently operational in its home base of Minneapolis, Minn., Chicago and New York City.  Joshin will be soft launching in 8 new markets over the next few weeks and hopes “to be national very soon,” Fountaine said.

The startup is starting with employers, and building up the data that it derives from that effort. Over the next year, it intends to partner with managed Medicaid organizations, and with both private and public insurance companies so that it “can get families access to this care, quickly,” said Danielsen.

“Our goal is to make this to make quality care free for families who need it,” she told TechCrunch.

Chris Male, co-founder of the Autism Impact Fund, said his organization backs companies that are addressing unmet needs of the autism community. Finding, retaining, and coordinating care are three of the biggest hurdles that individuals with autism spectrum disorder (ASD) and their families face, according to Male.

“Joshin has a proven ability to provide a reliable means to source caregivers with diverse skill sets and potential to serve as a platform for streamlining access to a variety of critical yet highly fragmented services for the special needs community,” he said. “Given the current insurance payer landscape and employer emphasis on DEI, Joshin is not only generating strong impact for a large disability market, but is a monetizable opportunity as both a reimbursable service and as a benefit to employees.”

By partnering with employers, Male added, Joshin will help provide an environment of support that will allow “employees to quickly and easily access key resources and thus minimize downtime. “

Matthew Jones, managing director at Anthemis, said his firm doubled down on its investment in the startup because it saw in its founders “one of the strongest examples of founder-market fit out there.” (Anthemis also led the company’s $1.6 million funding round in July of 2020).

The progress that they have made since our last investment – coupled with the insights that they have collected – led us to believe that doubling down in this round was a no-brainer,” he told TechCrunch.

Also, the complexity that comes with building technology in the space “makes the barriers to entry very high,” Jones added.

“The team’s grit, combined with their understanding of the problems and opportunities associated with disability-related care, set Joshin apart,” he wrote via email. “No other platform comes close in terms of having such specialized leaders at the helm, so it’s no surprise that corporates are lining up to add Joshin to their roster of employee benefits.”

#anthemis, #apps, #disabilities, #minnesota, #startup, #tc

How one founder turned painful personal experience into the solution for a huge gap in healthcare

A lot of startup founders think there’s a dire need for their product in the market, but Liya Shuster-Bier knew for sure that there was one, because she’d required it herself prior to building it — yet nothing like it existed. Liya’s company Alula provides a new kind of shopping platform, organized based on treatment types, and includes both registry and care calendar features for helping a whole network of caregivers rally around someone’s cancer diagnosis.

On this week’s episode of Found, we talk about Liya’s entrepreneurial journey, as well as the challenges of managing a cancer diagnosis, even after remission, and how that provided her with the inspiration not just for what Alula does, but also for how the company functions. She provides us tremendous insight about what it means to be a leader, and how you can build a company that has mutual respect and concern for our shared humanity as a core value that’s also a commercial success.

We loved our time chatting with Liya, and we hope you love yours listening to the episode. And of course, we’d love if you can subscribe to Found in Apple Podcasts, on Spotify, on Google Podcasts or in your podcast app of choice. Please leave us a review and let us know what you think, or send us direct feedback either on Twitter or via email at found@techcrunch.com, or leave us a voicemail at (510) 936-1618. And please join us again next week for our next featured founder.

#found, #founder, #health, #startup, #tc

Playbook, which aims to be the ‘Dropbox for designers,’ raises $4M in round led by Founders Fund

When Jessica Ko was head of design at Google and then Opendoor, she realized that her teams spent about 90% of their time digging around Dropbox looking for assets.

In many cases, they’d find older versions. Or they couldn’t find what they were looking for. Or even worse, they’d accidentally pick the wrong asset.

“It was such a chaotic process,” Ko recalls. “Anyone could go in and alter things and change folder structures around. It was a total mess, and just continued like that because there was no alternative.”

As Opendoor grew in size, the problem became an even bigger one, she said. 

“Designers were quitting because it was giving them so much anxiety,” Ko recalls. “Dropbox hadn’t solved it yet. Google Drive was not a good alternative either. Designers deal with files the most, and we’re exchanging files constantly.

Besides the frustration and stress the problem of file storage and sharing caused, not being able to locate the correct assets also led to errors, which in turn led to lots of money lost, according to Ko.

“We spent a lot of money on photo shoots because we couldn’t find new things, or people would have to recreate designs,” she said. 

On top of that, she said, designers weren’t the only ones who needed to access the assets. Finance teams were constantly needing them for things like creating pitch decks.

So in 2018, Ko left Opendoor to set about solving the problem she was tired of dealing with by creating file storage for modern design workflows and processes. Or put more simply, she wanted to build a new kind of cloud storage that would serve as an alternative to Dropbox and Google Drive “built by, and for, creatives.”

In early 2020, Ko (CEO) teamed up with Alex Zirbel (CTO) to launch San Francisco-based Playbook, which she describes as the “Dropbox for designers,” to tackle the challenge. And today, the startup has emerged from stealth and announced it has raised $4 million in a seed funding round led by Founders Fund at a $20 million post-money valuation.

Other investors in the round include Abstract, Inovia, Maple, Basis Set, Backend, Wilson Sonsini and a number of angels, including Opendoor co-founder and CEO Eric Wu, Gusto co-founder Eddie Kim and SV Angel’s Beth Turner.

The first thing Playbook set out to do was attempt to reinvent the way folders exist for assets, with subfolders underneath. And then, the company set about trying to change the way people share files. 

“Since so much is done over email and Slack these days, version control becomes even more difficult,” Ko told TechCrunch. So Playbook, she said, has built a storage system that can be accessed by all parties as opposed to just sending files via different channels.

“For years, these assets have been dropped into what feels like a file cabinet,” Ko said. “But these days, sharing assets is much more collaborative and there’s different kinds of parties involved such as freelancers and contractors. So who is managing these files, and controlling the versions has become very complex.”

Playbook offers 4TB of free storage, which Ko says is 266 times the free version of Google Storage and 2,000 times that of Dropbox. The hope is that this encourages users to use its platform as an all-around creative hub without worrying about running out of storage space. It also automatically scans, organizes and tags files and has worked to make it easier to browse files and folders visually.

Image Credits: Playbook

In March, Playbook opened a beta version of its product to the design community and got about 1,000 users in two months. People continued to sign up and the company at one point had to close the beta so that it could manage all the new users.

Today, it has about 10,000 users signed up in beta. Early users include individual freelancers to design teams at companies like Fast, Folx and Literati.

The seven-person company wants to focus on getting the product “right” before attempting to monetize and launch to enterprises (which will likely happen next year), Ko said.

For now, Playbook is focused on the needs of freelancers. The company believes that the exponential growth of freelancers post-pandemic means “cloud storage needs to be smarter.”

“We want to first solve that use case, and unlock the problem from the bottom up,” Ko told TechCrunch. 

Also, another strategy behind that initial focus is that freelancers can also introduce Playbook to the companies and enterprises they work for, so the marketing then becomes built into the product.

“They can transfer assets and files through Playbook to their clients, who tend to adopt,” she said.

Today, Playbook is helping manage over 2 million assets and says it has “hundreds of waitlist sign-ups” every month.

Looking ahead, Zirbel said the startup wants to branch out into image scanning, similarity, content detection, previewing and long-term cloud storage and tons of integrations.

“There are lots of interesting technology challenges when you focus on the creative side of cloud storage,” he said.

Founders Fund’s John Luttig said when the firm first met Ko and Zirbel last year, it was “clear that they had a depth of understanding and thoughtfulness around file management” that his firm hadn’t seen before. Plus, in his view, there has been very little innovation in cloud storage since Dropbox launched in 2007. 

“The product leverages modern design, collaboration principles, and artificial intelligence to make file management much faster and easier,” he wrote via email. “Given their design-centric backgrounds, they’re extremely well-positioned to rethink the user experience for file systems from the ground up.”

Playbook, he said, is able to leverage recent advancements in computer vision and design “to build a far better product to manage and share files.”

#designers, #dropbox, #founders-fund, #funding, #fundings-exits, #jessica-ko, #john-luttig, #opendoor, #playbook, #recent-funding, #startup, #startups, #storage, #venture-capital

Mexican neobroker Flink raises $57M from Lightspeed, The Chainsmokers to boost financial inclusion in LatAm

Flink, a Mexico City-based neobroker, has raised $57 million in a Series B round of funding led by Lightspeed Venture Partners.

The financing comes just over six months after Flink raised $12 million in a Series A round led by Accel. Existing backers Accel, ALLVP, Clocktower and new investor Mantis Venture Capital (founded by The Chainsmokers) also put money in the Series B. Since its 2017 inception, the startup has raised nearly $70 million.

Neobrokers are defined as startups that are disrupting the investment industry by providing a platform for a wider range of consumers to partake in the stock market by offering them more incremental investment options and modern and easy mobile-based interfaces to manage their money. There is a growing number of them globally, including Scalable Capital, Bitpanda and Trade Republic in Europe.

For Mexico City-born Sergio Jiménez Amozurrutia, the fact that in his country of more than 120 million people, only a tiny fraction of the population has the ability to invest in the capital markets felt unfair. To him, the lack of widespread participation in investing is an example of the rich getting richer as part of an infrastructure “that is built for the wealthy.” The result of the imbalance is that a lot of people have historically been locked out of making potentially wealth-building investments.  

So after selling Easy Credit, a consumer lending platform he’d built with Rick Rafael Bueno (whom he met in 2015 at a hackathon at Tech de Monterrey), Amozurrutia set out to give Mexicans access to something he believed they’d never had access to: an app-based consumer trading platform.

Flink launched its app in 2018 with a wallet service, a digital and physical global debit card backed by Mastercard and, last year, it began offering the ability to buy and sell fractional shares from 30 pesos, without commissions, for NYSE-listed stocks.

“Users can invest as little as US$1 and with zero commissions,” Amozurrutia said. “We want Flink to be the easiest way to invest, save and use your money.” 

Image Credits: Lightspeed’s Mercedes Bent and Flink founding team / Lightspeed

The demand for what the startup has to offer is clearly there. Since launching its first brokerage product in July of 2020, Flink has 1.6 million users, up from 1 million users at the time of its February raise. Over 85% of its users are first-time investors. GenZers seem to be the most interested in investing — 27% of the app’s clients are between 18 and 25 years old, while 22% are millennials, execs say.

“Most legacy Mexican banks cater to less than 1% of the population — meaning most Mexicans don’t have a bank account, let alone a brokerage account,” Amozurrutia said at the time of the company’s last raise. “At Flink, we’re guided by the belief that Mexico’s financial system should work for everyone — not only a select few.”

The company is growing its user base by 38% per month and revenue by 31% per month, according to  Amozurrutia, and touts a user acquisition cost of 62 cents. It is currently the largest retail brokerage service in Mexico, he said. Flink has 110 employees, up from 25 people a year ago today.

The startup plans to use its new capital to keep growing its team, toward product development and to expand its service to different countries in Latin America.

“The lack of access for retail investing is all over LATAM, and at Flink we want to change that,” Amozurrutia told TechCrunch. “We are focused on offering the opportunity to invest and grow their money to everyone in LATAM.”

Lightspeed Partner Mercedes Bent said her firm “fell in love” with Flink’s mission and impact on the country’s “financial ecosystem.” It was also impressed by the company’s unique features, including allowing Mexican investors to access the U.S. stock market and invest fractional shares.

“Many equities platforms only let you invest in equities in your own country,” she said. “Flink also has a big focus on education and creating an investment experience that makes it easy for their users to onboard.” For example, Bent noted, Flink has a podcast dubbed “Finanzas en órbita” that provides financial and stock market education in México.

In a blog post, Bent and Will Kohler wrote that they could feel the company’s passion and vision for creating more financial inclusion in Mexico, even via a Zoom call.

“The excitement leapt through the video screen,” the pair wrote. “…Flink’s vision for the future goes beyond accessing stocks, and we wanted to be a part of it.”

Flink marks Lightspeed’s third investment in Mexico, alongside Stori and Frubana, and Bent and Kohler say there is “more to come.”

“We are big believers in México, and bullish on LATAM,” they wrote.

#apps, #finance, #fintech, #flink, #fundings-exits, #latin-america, #lightspeed-venture-partners, #mercedes-bent, #mexico, #mexico-city, #neobroker, #recent-funding, #sergio-jimenez-amozurrutia, #startup, #startups, #the-chainsmokers, #venture-capital

Accel leads $18M Series A for Knoetic, a startup that wants to make HR professionals’ lives easier with software

Knoetic, a startup that has built a software analytics platform for chief people officers, emerged from stealth today with $18 million in Series A funding.

For the unacquainted, chief people officers are also known as heads of human resources, or HR.

Accel led the financing, which notably also included participation from over 100 angel investors, including a number of executives, VCs and former and current chief people officers (CPOs) of companies such as Mozilla, Pinterest, Gusto, Box, Twilio, Fitbit, Kickstarter, Looker, Hired and GitHub.

For founder and CEO Joseph Quan, the fact that so many people who worked in the industry put money in the round as angels was huge validation that Knoetic is on the right track.

Founded in March 2020, the New York City-based startup has built a platform that combines a social network and a SaaS analytics tool for chief people officers. When the COVID-19 pandemic hit last year, human resources leaders found themselves in a position they’d never before been — hiring talent remotely and having to work virtually to retain workers that previously came to an office.

Quan himself has worked in a variety of roles in the HR technology space, including at Twine, Knoetic’s predecessor company. 

Image Credits: Knoetic; Founder and CEO Joseph Quan

“The reason we exist was really born out of the pandemic. We noticed in our ecosystem of chief people officers that their role was thrust into the spotlight and it was a really tough time for them, and also a really lonely time,” Quan told TechCrunch. “Everyone was kind of scrambling for answers and we just realized this was a time to actually put together a network that allows all these people to commiserate and tackle some of their hardest questions, and then from that, form the basis for a broader vision.”

Over 1,000 HR professionals are members of Knoetic’s social community, which the company has embedded directly into its people analytics software. The result, Quan said, is an “Insight Engine” designed to give CPOs both quantitative and qualitative insights with the goal of helping them make “smarter, holistic” decisions about their workforce. The network is a referral-only community aimed at giving HR professionals a forum to discuss best practices and their “most pressing challenges,” such as how to navigate the COVID Delta variant and transition to and from remote work, Quan said.

 Chief people officers can also use Knoetic to do things like build board decks and present data to their CEOs. The company also claims the platform can help CPOs improve employee retention, compensation and hiring. 

Image Credits: Knoetic

In a short amount of time, Knoetic has built an impressive customer and community base, including the likes of Lyft, Squarespace, Amplitude, Discord, Dollar Shave Club and Zapier. 

Vas Natarajan of Accel believes that Knoetic is solving “a deep pain point.”

“We see how overstretched people teams are trying to wrangle information to make organizational decisions,” he wrote via email. “Across our best companies is a strong people function backed by great data to help inform all kinds of decisions around compensation, performance, and diversity and inclusion, among other things. Knoetic is uniformly solving this for everyone.”

The startup will use its new capital toward building out new products and hiring. It currently has about 25 employees, and Quan expects that number to grow to “north of 40” by year’s end.

“We want to build the single greatest network for HR professionals and build a dedicated community team,” he said.

Down the line, Quan also envisions creating an analytics engine that is “prescriptive and predictive” and can do things like tell HR leaders what kind of turnover their companies are seeing, what they can do about it and how to improve retention.

“And then it would be predictive as we gather more big data points as more people use the platform,” he added. “Then we could use that data to proactively predict who’s going to be a fast-rising company or who’s going to trip over the next 12 months. We’re starting to build those kinds of models on the back end.”

#accel, #chief-people-officer, #hiring, #hr, #knoetic, #new-york-city, #recent-funding, #startup, #startups, #vas-natarajan, #venture-capital

Ramp raises $300M at a $3.9B valuation, makes its first acquisition

Less than five months after raising $115 million, spend management startup Ramp announced today it has raised $300 million in a Series C round of funding that values the company at $3.9 billion.

That’s more than double the $1.6 billion that New York-based Ramp was valued at in April at the time of its Series B.

Founders Fund led the latest round, which brings the fintech’s total equity and debt raised to date to over $625 million since its March 2019 inception. Redpoint Ventures, Thrive Capital, D1 Capital Partners, Spark Capital, Coatue Management, Iconiq, Altimeter, Stripe, Lux Capital, A* Partners, Definition Capital and other existing backers participated in the financing. Founders Fund also led Ramp’s $15 million Series A in February 2020.

It’s been a good year for Ramp, which first launched its corporate card in August of 2019. Since the beginning of 2021, the company says it has seen its number of cardholders on its platform increase by 5x, with more than 2,000 businesses currently using Ramp as their “primary spend management solution.” The transaction volume on its corporate cards has tripled since April, when its last raise was announced. And, impressively, Ramp has seen its transaction volume increase year over year by 1,000%, according to CEO and co-founder Eric Glyman. Given the company’s business model (it makes money mostly off interchange fees), Ramp also saw its revenue increase by the same amount during that time frame.

A wide range of customers use Ramp from startups/unicorns such as Ro, DoNotPay, Better, ClickUp and Applied Intuition to established businesses like Bristol Hospice, Walther Farms, Douglas Elliman and Planned Parenthood. 

“The pace of growth in the business has been a lot faster than people expected and so that’s a big part of what’s underpinning this new investment and valuation,” Glyman told TechCrunch. “Even in August, we’re experiencing what is shaping up to be the fastest percentage growth all year, if not ever.”  

Indeed, such big growth numbers are more commonly seen in the very early stages of a company, and tend to lessen over time as a company matures. 

Says Founders Fund’s Keith Rabois: “As the company has grown, I’ve continued to invest heavily because it’s rare to find a business with a growth rate that is actually increasing as it gets larger. Typically growth slows as a company scales, but demand for Ramp’s product is only accelerating as the team builds awareness and strengthens their product offering.”

Ramp also today announced its acquisition of Buyer, a “negotiation-as-a-service” platform that claims to save its clients an average of 27.3% on big-ticket purchases, such as annual software contracts. 

With the addition of the 10-person Buyer team, Glyman said Ramp will be able to offer its customers a “customized and proactive approach” to savings on large purchases.

“There are more B2B growth SaaS companies than ever before, and they’re better at charging than they’ve ever been,” he noted. “Buyer is viewed as the leader of a generation of startups that are trying to flip the tables and actually help customers negotiate rates down. Very large companies might have procurement departments to negotiate rates, but for those who don’t, Buyer is very skilled at identifying what new contracts are coming up and negotiating them down.”

It has saved its customers about 27% on SaaS contracts. 

“We’re looking forward to adding those figures to the savings we’ve helped businesses incorporate,” Glyman said.

The buy follows a partnership that was forged earlier this year before Ramp realized that it could “be even stronger by having them fully as a part of the Ramp team, and and really build out even further.”

Over time, Ramp  intends to expand its product offering as a result of the acquisition. By combining Buyer’s team with benchmarking spend data from millions of transactions on its platform, Ramp says it wants to help its customers negotiate the best rate on “anything that can be purchased with a card, from travel to software — with the goal of shifting purchasing power back into the hands of buyers.”

Image Credits: Ramp

Other ways Ramp helps its customers save include offering 1.5% cash back “on everything,” helping them identify ways to spend less, such as identifying and canceling duplicitous subscriptions and identifying redundancies in licenses. It also shows companies when better pricing is available. One example of this is letting them know they can save 20% by switching to an annual rate, as opposed to monthly. It also has helped customers save by getting rid of software like Concur, Expensify or Bill.com by helping them manage their expenses. Ramp claims that its customers on average save 3.3% annually by switching their corporate card spending to Ramp.

Earlier this year, the company added merchant blocking to its corporate credit card, which Glyman says has probably become one of the company’s most used features since adoption.

Looking ahead, the company plans to use its new capital to speed up the development of its finance automation platform. It’s also going to naturally continue to hire, adding to its nearly 150-person team. For context, Ramp started the year with 65, people and employed about 100 at the time of its April raise.

“Hiring is going to be the biggest use of our capital,” Glyman told TechCrunch. 

The startup is also going to invest heavily in product development, including expansion into broader B2B payments, and marketing and awareness. It’s also going to look for more acquisition targets.

While Ramp currently makes money mostly by interchange fees, Glyman told me previously that the two-year-old startup thinks of itself as a SaaS operator.

“Our long-term strategy is to develop great software,” he said.

No doubt the spend management space is heating up. Last week, Brex announced it was acquiring one-year-old Weav for $50 million in its first significant acquisition. Founded in 2017, San Francisco-based Brex earlier this year was valued at $7.4 billion after raising a $425 million Series D led by Tiger Global. It is more focused on earlier-stage startups, whereas Ramp tends to serve larger, more established companies.

#eric-glyman, #expense-management, #finance, #fintech, #founders-fund, #funding, #fundings-exits, #keith-rabois, #ma, #ramp, #recent-funding, #spend-management, #startup, #startups, #venture-capital

Givz raises $3M in seed funding to make donations a marketing tool for businesses

Givz, which has developed an API-powered platform that gives brands a way to convert discounts into donations, has raised $3 million in seed funding.

Eniac and Accomplice co-led the financing for the New York-based startup. Additional investors include Supernode Ventures, Claude Wasserstein of Fine Day, Phoenix Club and Dylan Whitman.

Givz was founded in 2017 to make charitable giving more accessible and convenient for the masses. In March 2020, right before the COVID-19 pandemic hit, the company pivoted from B2C to B2B and used the technology rails it had built to create the e-commerce marketing platform that Givz is today.

The company aims to drive “full-price purchasing behavior” by giving consumers the ability to convert the money they would be saving if getting a discount, and donating it to their favorite charities. 

Prior to the funding, Givz had been working with more than 80 enterprise, mid-market and SMB retail and e-commerce clients such as H&M, Tom Brady’s TB12, Seedlip and Terez, and accumulated more than 40,000 individual users. Since the shift last year, the company has helped drive more than $1 million to 1,100 charities, according to CEO and founder Andrew Forman.

It just launched on Shopify, which Forman says will give the startup access to the 1.7 million retailers that use Shopify as their e-commerce platform.

Givz operates under the premise that “donation-driven marketing” consistently outperforms discounts and costs less, “making it an attractive addition” to corporate marketing.

“We are creating a new marketing category and generating the largest sustainable charitable giving platform in the process,” he told TechCrunch. 

An example of a company using Givz can be found in Tervis, which offered customers “For every $50 you spend, you’ll receive $15 to give to the charity of your choice.” 

“They used Givz technology to allow consumers to choose the charity of their choice and make a turnkey disbursement to hundreds of charities,” Forman explained. “They saw a 20% lift in website conversion and a 17% increase in average order value as a result of this offer.”

Image Credits: Givz

Currently, Givz has eight employees with plans to more than double that number over the next year.

The company plans to use the new capital toward that hiring, and to do some marketing of its own.

“We also want to explore the full potential around the consumer behavior data we collect,” Forman said.

In the short term, Givz is focused on “Shopify growth” with direct to consumer brands.

“But we have successful use cases and huge potential with enterprise retailers and financial institutions,” Forman told TechCrunch. “In the future, we have our sights set on restaurants, the gaming industry and global expansion. I believe that using personalized donations to incentivize consumer behavior has endless application across industries, verticals and continents.”

Eniac partner Vic Singh said that there’s been a trend of brands experimenting with different ways to target the socially conscious consumer. 

“We believe Givz’s donation-driven marketing platform offers brands the best way to attract the socially conscious consumer while elevating their brand, moving more inventory and driving increased order value rather than simplistic traditional discounting,” he added.

Accomplice’s TJ Mahony said that both he and Singh believed SMS would emerge as a new marketing category, which led to early investments in Attentive and Postscript, respectively.

“We both saw a similar opportunity with Givz,” he wrote via e-mail. “Discounting is a well worn marketing muscle, but it’s detrimental to the brand, margins and customer expectations. We believe continuous impact marketing becomes the alternative to discounting and marketers will begin to build teams and budget around thoughtful and persistent giving strategies.”

#accomplice, #api, #e-commerce, #ecommerce, #eniac-ventures, #funding, #fundings-exits, #givz, #marketing, #new-york, #payments, #recent-funding, #retail, #saas, #startup, #startups, #tc, #venture-capital, #vic-singh

One banks $40M to offer ‘all-in-one’ financial services to the middle class

One, a startup that aims to bring “all-in-one banking” to the middle class, announced today that it has raised $40 million in a Series B round of funding.

Progressive Investment Company (the insurance giant’s investment arm) led the round, which included participation from Obvious Ventures, Foundation Capital, Core Innovation Capital and others. The financing brings One’s total raised since its 2019 inception to $66 million.

Since making its product generally available in September of 2020, Northern California-based One has grown to have “hundreds of thousands” of customers, according to CEO and co-founder Brian Hamilton, who previously co-founded PushPoint (which was acquired by Capital One).

“Stretched middle-income households and working families deal with financial stress on a daily basis and are largely unsupported by current offerings,” Hamilton said. “This can be viewed as a kind of a noisy market, and so this funding has been a good validation of the vision and kind of the products, in that we have been able to stand out in that market.”

Over the past 11 months, the startup has worked to enhance its core product offering, launching overdraft protection, an auto-save feature that rewards automatic savings contributions at 3.00% APY, cash flow-based credit lines and a credit builder product to help its customers build financial health. One claims that it has helped its users automatically save over $2 million collectively since its launch, a number that grows daily, according to Hamilton.

The company is also trying to change up how people share financial goals and responsibilities with individually configurable “Pockets” that it says can be “easily” shared with others and accessed via virtual and physical cards. 

“What we’re doing really is to re-integrate and unify what is otherwise a pretty splintered financial life for middle income households and families that are attempting to manage finances on a daily, weekly and monthly basis,” Hamilton told TechCrunch.

Over the past few years, he said, there have been a number of different fintech and bank products that people use to run their life “and they’re all starting to converge.”

The company was founded on the premise that traditional banking exists “on a system of fractured accounts and billions of dollars in hidden fees that leave customers living paycheck to paycheck despite steady incomes.” One says it is built on a “proprietary” technology core that aims to deliver saving, spending, sharing, budgeting and borrowing in a single account.

“Everybody’s trying to do a piece of everything, but they all started doing one thing,” Hamilton said. “But it’s really hard to back into the others or to bolt them on afterwards if you didn’t begin with the end in mind, kind of on an integrated basis. So that is essentially what we set out to build with One, with the idea to reunify credit and debit and savings and reintegrate the sharing of money with other people so it didn’t have to be done on a one-off transactional basis through Venmo or PayPal or Zelle.”

One’s banking services are provided by Coastal Community Bank, Member FDIC. The startup emphasizes that it’s a financial technology company, and “not a bank.”

It plans to use the new funding toward “fueling” customer growth, hiring and expanding its product offerings.

Charles Moldow, Foundation Capital general partner and One investor, said that challenger banks such as Chime and Aspiration focus on a debit card offering to subprime customers who are looking for lower bank fees and access to paychecks sooner.  

“These customers are generally treated poorly by banks and charged a lot of fees because they don’t generate much revenue for banks outside of interchange fees on debit purchases with little disposable income,” he said.

The real money made by banks, according to Moldow, is against mid-prime customers for both debit and lending.  

“These customers are harder to acquire because banks hate to lose them due to their large lifetime values,” he said. “One differs from the challenger banks in the market in that they have created a superior mobile banking experience for the 80% of the market that is not super prime or subprime. They have both a debit and credit offering and a vastly better user experience.”

The fintech is able to offer a user experience that is “materially” different from standard large bank offerings in that their back end infrastructure is a “modern” core and One is able to handle core checking, lending, money transfer and savings all on the same back end.

This means One can fully integrate those experiences (the aforementioned integrated offering “Pockets”).

“This differs from traditional banks which have each of these systems on top of different tech stacks which prevents them from providing integrated offerings,” he said. 

Also, by not having brick and mortar branches, the company is able to offer lower fees, more points and rewards and higher savings rates, Moldow added.

#apps, #banking, #charles-moldow, #digital-banking, #finance, #financial-services, #fintech, #foundation-capital, #funding, #fundings-exits, #one, #progressive, #recent-funding, #startup, #startups, #venture-capital

Brazil’s Kovi closes $104M Series B to make car ownership ‘more inclusive’ in LatAm

We sometimes take for granted that most anyone who wishes to become say, an Uber driver, can do so. But that assumption is a narrow view considering there are many people who would love to earn income in that way but can’t because of lack of car ownership (and all that goes with it) — especially in countries outside of the United States.

In an attempt to remedy that problem, São Paulo-based Kovi was founded in 2018 to give those people access to those opportunities. 

Kovi today is announcing it has raised $104 million in a Series B round of funding co-led by Valor Capital Group and Prosus Ventures. Quona, GFC, Monashees, UVC Investimentos and Globo Ventures also participated in the financing, in addition to Tinder co-founder Justin Mateen and PayPal co-founder Peter Thiel through his family office. The round takes Kovi’s total equity raised since inception to about $145 million. The company also recently closed on a $20 million debt facility. It is not yet a unicorn, according to execs, who declined to reveal valuation.

Two former 99 (Brazil’s first tech unicorn, and also known as Didi) executives, Adhemar Milani Neto and João Costa, started the company, which rents vehicles to on-demand drivers who work for ride-hailing companies such as Uber, Didi and Lyft. It then expanded from on-demand drivers to food delivery workers.

Kovi operates its “all inclusive” car subscription model under the premise that more people in Latin America would work for these companies if they could afford to operate the necessary vehicle. In fact, an estimated 75% of Latin Americans cannot own a vehicle because of the high cost of acquisition and maintenance. Cars are significantly more expensive in countries like Brazil than in the U.S. and the difference is even greater when it comes to the average income of the population. Also, financing is often difficult and expensive to obtain, as credit is difficult to access in most Latin American countries. When applying for loans, 60% of applications are denied by traditional banking institutions, according to Kovi co-founder and CEO Adhemar Milani Neto. And even when approved, customers pay high interest rates that are up to 30% per year.

Kovi gives drivers who don’t necessarily want, or cannot afford, to own a vehicle “quick access to quality cars” at what it says is “a fair price.” It operates an asset-light model, in that it does not buy vehicles but instead has inked rental agreements with OEMs such as Toyota and Volkswagen to offer vehicles to gig workers, including insurance and maintenance.

“Our mission is to promote a revolution in this market, making car ownership affordable, less complicated and accessible to an underserved population,” Neto said. “We want to offer a range of options to create a platform for urban mobility and create more possibilities for our customers.”

Image Credits: Kovi

In 2020, the startup saw its number of customers grow by more than 70%, and it now has more than 11,000 users in Brazil and Mexico. The company has 12,000 cars in its fleet and aims to add another 20,000 cars by the end of 2021. The company says its ARR (annual recurring revenue) is now roughly around $45 million, and that it is growing by at least 15% month over month. Kovi is “very close” to breaking even and plans to this year, according to Neto.

“Our mission is to make car ownership more inclusive, human and efficient using technology and financial innovation,” he said.

What sets Kovi apart from competitors is that its cars are connected, so it uses data science and analytics to be able to offer “a better user experience and competitive prices,” believes Kovi co-founder João Costa.

The company also over time has shifted from offering insurance through third parties to offering insurance.

“We basically built an insurance company from scratch,” Neto said.

When the pandemic hit in 2020, Kovi — as did many other companies — at first saw its business slow. So the company quickly pivoted by changing its model to a pay-per-mile model so that it could act as a “Root Insurance for car owners,” Neto said.

The model has worked very well for drivers, he added. The company also enhanced its B2C offering so that drivers can access a car, with “everything included,” from insurance to 24-hour road support and preventive maintenance through Kovi.

“Once things got more back to normal, the on-demand economy scaled really fast,” Neto said.

Kovi also in the past year broadened its scope from a short-term car subscription to include a long-term option. That has proven successful so far, with that segment of its business growing to 35% of Kovi’s revenue already since launching in October of last year.

This also creates more profit for the OEMs Kovi is partnered with, Neto added.

“We provide a much better profitability model for them rather than just to sell to rental companies or end consumers. They make recurring revenue for 12-24 months and then resell used cars through their dealerships,” he said. “We’re now taking Kovi to the broader OEM market. We see this as a global business model that extends not only in Brazil and Mexico but across LatAm and to other developing countries.”

Indeed, Kovi will use its new capital to expand its service to new cities in Latin America and double down on existing operations in Brazil and Mexico. The money will also go toward technology development, specifically data management and the company’s pay-per-mile capabilities (which its founders say is unprecedented in Latin America). It also, naturally, plans to add to its 700-person team — including hiring developers, software engineers and data scientists. And, finally, Kovi plans to use some of its fresh capital to launch new financial services and products. 

For example, the company began the buildout for some of those products earlier this year, launching its aforementioned auto insurance offering, dubbed Kovi Seguro — a tracked insurance for app drivers. It also plans to launch “to a rent to own” option, Neto said. So that drivers who want to own a vehicle will have a way to work toward that.

Prosus’ Banafsheh Fathieh says that ultimately, Kovi is a financial services company that can offer consumers that may not qualify for credit under traditional models to incrementally work toward owning a car through a subscription plan.

“Because Kovi owns and manages their fleet during the rental period — and therefore can control the fleet remotely — it is able to cater to a severely financially underserved population that’s typically considered higher risk by creditors,” Fathieh told TechCrunch.

Valor co-founder and managing partner Scott Sobel believes that Kovi is “well positioned” to capture three major tailwinds that have the potential to disrupt the multibillion-dollar car ownership market of Latin America. 

The first of those tailwinds is ride-hailing.

“Only in Latin America there are approximately 1.5 million on-demand drivers, and this number is expected to grow by ~2-3x this decade,” he said. “Take Uber as an example: three of its biggest markets are São Paulo, Mexico City and Rio de Janeiro.”

The second tailwind is car subscription. Less than 0.5% of Brazilian cars are under subscription offerings, and that number is expected to reach ~10-20% in the next five years due to consumer behavioral changes.

“Being one of the first movers in LatAm gives Kovi an edge,” Sobel told TechCrunch.

The third tailwind is auto insurance, which he thinks will be disrupted by more flexible (such as pay as you go, pay per mile, unbundled policies) customer-centric and tech-driven models. 

“These global trends will provide greater access to millions of drivers in the region,” Sobel said. For example, as of now less than 30% of Latin American drivers have an active car insurance policy.

Valor, he added, was impressed with Kovi’s traction and the “strong competitive moats” the company has built, including verticalized maintenance centers designed to reduce idle time and costs, a driver’s wallet, IoT systems integrating the entire fleet and “all the data.”

“Kovi is a very smart company, obsessed with metrics, tech and product innovation,” Sobel added.

#brazil, #finance, #funding, #fundings-exits, #kovi, #latin-america, #mobility, #prosus-ventures, #recent-funding, #saas, #startup, #startups, #transportation, #valor-capital

Branch raises $48M from Lee Fixel’s Addition, Indeed to provide accelerated payments to workers

Branch, which has built a flexible workforce payments platform, announced today it has raised $48 million in Series B funding and closed on a $500 million credit facility.

Lee Fixel’s Addition –– which has also backed the likes of Flipkart, Stripe and Coinbas