Tim Hortons marks two years in China with Tencent investment

Tim Hortons, the Canadian coffee and doughnut giant, has raised a new round of funding for its Chinese venture. The investment is led by Sequoia China with participation from Tencent, its digital partner in China, and Eastern Bell Capital. The round comes two years after Tim Hortons entered the Chinese market.

More to come… 

#tc

0

Newsela, the replacement for textbooks, raises $100M and becomes a unicorn

Newsela, a SaaS platform for K-12 instructional material backed by the likes of TCV, Kleiner Perkins, Reach Capital, and Owl Ventures, announced today that it has raised $100 million in a Series D round. The financing was led by new investor Franklin Templeton, and brings Newsela’s valuation to $1 billion. The new round is larger than the aggregate of Newsela’s prior capital raised to-date.

“Hitting $1 billion [in valuation] doesn’t change a thing,” Newsela CEO Matthew Gross told TechCrunch. But the startup is joining Quizlet, Applyboard, and CourseHero as companies within the sector that have hit the unicorn mark as remote education continues to gain traction.

Newsela has created a platform that strings together a number of different third-party content, such as primary source documents or the latest National Geographic articles. Gross defines it as “material that isn’t purpose-built for education, [but] purpose-built for being interesting and informative.” If Newsela is doing its job right, the content can replace textbooks within a classroom altogether, while helping teachers give fresh, personalized material.

“Textbooks are dead in classrooms, but are well-and-live in district purchasing,” Gross said. The startup is on a mission to distribute its product better, and the money will be used to get it into more classrooms. Part of this, Gross explains, is telling teachers what else it can provide along with textbooks. Analytics has become a big part of Newsela’s business, as remote learning hurts student engagement.

The startup’s paid product is between $6 to $14 per student, which contrasts with textbooks that can cost a school $20 to $40 per student “even on an annualized basis.”

Like other edtech companies, Newsela offered its product for free in the beginning of the pandemic, which gave it a healthy bump of new users.

Newsela estimates that gross bookings have grown 115% over the pandemic, and that revenue grew 81%. It declined to share revenue numbers or if it has hit profitability. There will be over 11 million students using Newsela licensing by the end of 2021, Gross said.

Newsela estimates that two-thirds of public schools in the United States are using their platform, likely aided by school district flexibility that has grown amid the pandemic.

#edtech, #education, #franklin-templeton, #media, #newsela, #recent-funding, #startups, #tc, #teaching, #textbook

0

Orca wants to give boating navigation its ‘iPhone moment’

Boating is a hobby steeped in history and tradition — and so is the industry and those that support it. With worldwide connectivity, electric boats, and other technological changes dragging the sector out of old habits, Orca aims to replace the outdated interfaces by which people navigate with a hardware-software combo as slick as any other modern consumer tech.

If you’re a boater, and I know at least some of you are, you’re probably familiar with two different ways of chart-plotting, or tracking your location and route: the one attached to your boat and the one in your pocket.

The one on your boat is clunky and old-fashioned, like the GPS interface on a years-old budget sedan. The one in your pocket is better and faster — but the phone isn’t exactly seaworthy and the app drains your battery with a quickness.

Orca is a Norwegian startup from veterans of the boating and chart-plotters that leapfrogs existing products with a built-from-scratch modern interface.

“The industry hasn’t changed in the last 20 years — you have three players who own 80 percent of the business,” said co-founder and CEO Jorge Sevillano. “For them, it’s very hard to think of how software creates value. All these devices are built on a user interface that’s 10-15 years old; think about a Tomtom, lots of menus, lots of clicks. This business hasn’t had its iPhone moment, where it had to rethink its entire design. So we thought: let’s start with a blank slate and build a new experience.”

CTO and co-founder Kristian Fallro started working on something like this years ago, and his company was acquired by Navico, one of the big players Sevillano refers to. But they didn’t seem to want to move forward with the ideas, and so he and the others formed Orca to pursue them. Their first complete product opened up for pre-orders this week.

“The challenge up until now has been that you need a combination of hardware and software, so the barrier to entry was very, very high,” Fallro explained. “It’s a very protected industry — and it’s too small for Apple and Google and the big boys.”

But now with a combination of the right hardware and a totally rebuilt software stack, they think they can steal a march on the dominant companies and be ready for the inevitable new generation of boaters who can’t stand to use the old tech any more. Shuttling an SD card to and from the in-boat system and your computer to update charts? Inputting destinations via directional pad? Using a separate mobile app to check weather and tides that might bear on your route? Not exactly cutting edge.

The Orca system comprises a ruggedized industrial tablet sourced from Samsung, an off the shelf marine quality mounting arm, a custom-designed interface for quick attachment and charging, and a computing base unit that connects to the boat’s own sensors like sonar and GPS over the NMEA 2000 protocol. It’s all made to be as good or better than anything you’d find on a boat today.

So far, so similar to many solutions out there. But Orca has rebuilt everything from the ground up as a modern mobile app with all the conveniences and connections you’d expect. Routing is instantaneous and accurate, on maps that are clear and readable as those on Google and Apple Maps but clearly still of the nautical variety. Weather and tide reports are integrated, as is marine traffic. It all runs on Android or iOS, so you can also use your phone, send routes or places of interest to the main unit, and vice versa.

Several devices showing the Orca chart-plotting interface.

Image Credits: Orca

“We can build new services that chart plotters can’t even dream of including,” said Sevillano. “With the latest tide report and wind, or if there’s a commercial ship going in your way, we can update your range and route. We do updates every week with new features and bug fixes. We can iterate and adapt to user feedback faster than anyone else.”

These improvements to the most central system of the boat mean the company has ambitions for coming years beyond simply replacing the ageing gadgets at the helm.

Information collected from the boat itself is also used to update the maps in near real time — depending on what your craft is monitoring, it could be used for alerting others or authorities, for example if you encounter major waves or dangerous levels of chemicals, or detect an obstacle where none is recorded. “The Waze of the seas,” they suggested. “Our goal is to become the marine data company. The opportunities for boaters, industries related to the sea, and society are immense.”

Being flexible about the placement and features means they hope to integrate directly with boats, becoming the built-in OS for new models. That’s especially important for the up-and-coming category of electric boats, which sort of by definition buck the old traditions and tend to attract tech-savvy early adopters.

“We’re seeing people take what works on land taking it to sea. They all have the same challenge though, the biggest problem is range anxiety — and it’s even worse on the water,” said Fallro. “We’ve been talking to a lot of these manufacturers and we’re finding that building a boat is hard but building that navigation experience is even harder.”

Whether that’s entirely true probably depends on your boat-building expertise, but it’s certainly the case that figuring out an electric boat’s effective range is a devilishly difficult problem. Even after building a new boat from starting principles and advanced physical simulations to be efficient and predictable, such as Zin Boats did, the laws of physics and how watercraft work mean even the best estimate has to be completely revised every few seconds.

“Figuring out range at sea is very hard, and we think we’re one of the best out there. So we want to provide boat manufacturers a software stack with integrated navigation that helps them solve the range anxiety problem their users have,” said Fallro.

Indeed, it seems likely that prospective purchasers of such a craft would be more tempted to close the deal if they knew there was a modern and responsive OS that not only accurately tracked range but provided easy, real-time access to potential charge points and other resources. Sure, you could use your phone — and many do these days because the old chart plotters attached to their boats are so limited. But the point is that with Orca you won’t be tempted to.

The full device combo of computing core, mount, and tablet costs €1,449, with the core alone selling for €449, with a considerable discount for early bird pre-orders. (For people buying new boats, these numbers may as well be rounding errors.)

Fallro said Orca is operating with funding (of an unspecified amount) from Atomico and Nordic VC firm Skyfall Ventures, as well as angel investors including Kahoot co-founder Johan Brand. The company has its work cut out for it simply in fulfilling the orders it has collected (they are doing a brisk trade, Fallro intimated) before moving on to adding features and updating regularly as promised.

#gadgets, #hardware, #tc, #transportation

0

Orca wants to give boating navigation its ‘iPhone moment’

Boating is a hobby steeped in history and tradition — and so is the industry and those that support it. With worldwide connectivity, electric boats, and other technological changes dragging the sector out of old habits, Orca aims to replace the outdated interfaces by which people navigate with a hardware-software combo as slick as any other modern consumer tech.

If you’re a boater, and I know at least some of you are, you’re probably familiar with two different ways of chart-plotting, or tracking your location and route: the one attached to your boat and the one in your pocket.

The one on your boat is clunky and old-fashioned, like the GPS interface on a years-old budget sedan. The one in your pocket is better and faster — but the phone isn’t exactly seaworthy and the app drains your battery with a quickness.

Orca is a Norwegian startup from veterans of the boating and chart-plotters that leapfrogs existing products with a built-from-scratch modern interface.

“The industry hasn’t changed in the last 20 years — you have three players who own 80 percent of the business,” said co-founder and CEO Jorge Sevillano. “For them, it’s very hard to think of how software creates value. All these devices are built on a user interface that’s 10-15 years old; think about a Tomtom, lots of menus, lots of clicks. This business hasn’t had its iPhone moment, where it had to rethink its entire design. So we thought: let’s start with a blank slate and build a new experience.”

CTO and co-founder Kristian Fallro started working on something like this years ago, and his company was acquired by Navico, one of the big players Sevillano refers to. But they didn’t seem to want to move forward with the ideas, and so he and the others formed Orca to pursue them. Their first complete product opened up for pre-orders this week.

“The challenge up until now has been that you need a combination of hardware and software, so the barrier to entry was very, very high,” Fallro explained. “It’s a very protected industry — and it’s too small for Apple and Google and the big boys.”

But now with a combination of the right hardware and a totally rebuilt software stack, they think they can steal a march on the dominant companies and be ready for the inevitable new generation of boaters who can’t stand to use the old tech any more. Shuttling an SD card to and from the in-boat system and your computer to update charts? Inputting destinations via directional pad? Using a separate mobile app to check weather and tides that might bear on your route? Not exactly cutting edge.

The Orca system comprises a ruggedized industrial tablet sourced from Samsung, an off the shelf marine quality mounting arm, a custom-designed interface for quick attachment and charging, and a computing base unit that connects to the boat’s own sensors like sonar and GPS over the NMEA 2000 protocol. It’s all made to be as good or better than anything you’d find on a boat today.

So far, so similar to many solutions out there. But Orca has rebuilt everything from the ground up as a modern mobile app with all the conveniences and connections you’d expect. Routing is instantaneous and accurate, on maps that are clear and readable as those on Google and Apple Maps but clearly still of the nautical variety. Weather and tide reports are integrated, as is marine traffic. It all runs on Android or iOS, so you can also use your phone, send routes or places of interest to the main unit, and vice versa.

Several devices showing the Orca chart-plotting interface.

Image Credits: Orca

“We can build new services that chart plotters can’t even dream of including,” said Sevillano. “With the latest tide report and wind, or if there’s a commercial ship going in your way, we can update your range and route. We do updates every week with new features and bug fixes. We can iterate and adapt to user feedback faster than anyone else.”

These improvements to the most central system of the boat mean the company has ambitions for coming years beyond simply replacing the ageing gadgets at the helm.

Information collected from the boat itself is also used to update the maps in near real time — depending on what your craft is monitoring, it could be used for alerting others or authorities, for example if you encounter major waves or dangerous levels of chemicals, or detect an obstacle where none is recorded. “The Waze of the seas,” they suggested. “Our goal is to become the marine data company. The opportunities for boaters, industries related to the sea, and society are immense.”

Being flexible about the placement and features means they hope to integrate directly with boats, becoming the built-in OS for new models. That’s especially important for the up-and-coming category of electric boats, which sort of by definition buck the old traditions and tend to attract tech-savvy early adopters.

“We’re seeing people take what works on land taking it to sea. They all have the same challenge though, the biggest problem is range anxiety — and it’s even worse on the water,” said Fallro. “We’ve been talking to a lot of these manufacturers and we’re finding that building a boat is hard but building that navigation experience is even harder.”

Whether that’s entirely true probably depends on your boat-building expertise, but it’s certainly the case that figuring out an electric boat’s effective range is a devilishly difficult problem. Even after building a new boat from starting principles and advanced physical simulations to be efficient and predictable, such as Zin Boats did, the laws of physics and how watercraft work mean even the best estimate has to be completely revised every few seconds.

“Figuring out range at sea is very hard, and we think we’re one of the best out there. So we want to provide boat manufacturers a software stack with integrated navigation that helps them solve the range anxiety problem their users have,” said Fallro.

Indeed, it seems likely that prospective purchasers of such a craft would be more tempted to close the deal if they knew there was a modern and responsive OS that not only accurately tracked range but provided easy, real-time access to potential charge points and other resources. Sure, you could use your phone — and many do these days because the old chart plotters attached to their boats are so limited. But the point is that with Orca you won’t be tempted to.

The full device combo of computing core, mount, and tablet costs €1,449, with the core alone selling for €449, with a considerable discount for early bird pre-orders. (For people buying new boats, these numbers may as well be rounding errors.)

Fallro said Orca is operating with funding (of an unspecified amount) from Atomico and Nordic VC firm Skyfall Ventures, as well as angel investors including Kahoot co-founder Johan Brand. The company has its work cut out for it simply in fulfilling the orders it has collected (they are doing a brisk trade, Fallro intimated) before moving on to adding features and updating regularly as promised.

#gadgets, #hardware, #tc, #transportation

0

DigitalOcean’s IPO filing shows a two-class cloud market

This morning DigitalOcean, a provider of cloud computing services to SMBs, filed to go public. The company intends to list on the New York Stock Exchange (NYSE) under the ticker symbol “DOCN.”

DigitalOcean’s offering comes amidst a hot streak for tech IPOs, and valuations that are stretched by historical norms. The cloud hosting company was joined by Coinbase in filing its numbers publicly today.

DigitalOcean’s offering comes amidst a hot streak for tech IPOs.

However, unlike the cryptocurrency exchange, DigitalOcean intends to raise capital through its offering. Its S-1 filing lists a $100 million placeholder number, a figure that will update when the company announces an IPO price range target.

This morning let’s explore the company’s financials briefly, and then ask ourselves what its results can tell us about the cloud market as a whole.

DigitalOcean’s financial results

TechCrunch has covered DigitalOcean with some frequency in recent years, including its early-2020 layoffs, its early-2020 $100 million debt raise and its $50 million investment from May of the same year that prior investors Access Industries and Andreessen Horowitz participated in.

From those pieces we knew that the company had reportedly reached $200 million in revenue during 2018, $250 million in 2019 and that DigitalOcean had expected to reach an annualized run rate of $300 million in 2020.

Those numbers held up well. Per its S-1 filing, DigitalOcean generated $203.1 million in 2018 revenue, $254.8 million in 2019 and $318.4 million in 2020. The company closed 2020 out with a self-calculated $357 million in annual run rate.

During its recent years of growth, DigitalOcean has managed to lose modestly increasing amounts of money, calculated using generally accepted accounting principles (GAAP), and non-GAAP profit (adjusted EBITDA) in rising quantities. Observe the rising disconnect:

#cloud, #cloud-infrastructure-market-share, #coinbase, #developer, #digital-ocean, #digitalocean, #enterprise, #exit, #fundings-exits, #ipo, #startups, #tc

0

DigitalOcean’s IPO filing shows a two-class cloud market

This morning DigitalOcean, a provider of cloud computing services to SMBs, filed to go public. The company intends to list on the New York Stock Exchange (NYSE) under the ticker symbol “DOCN.”

DigitalOcean’s offering comes amidst a hot streak for tech IPOs, and valuations that are stretched by historical norms. The cloud hosting company was joined by Coinbase in filing its numbers publicly today.

DigitalOcean’s offering comes amidst a hot streak for tech IPOs.

However, unlike the cryptocurrency exchange, DigitalOcean intends to raise capital through its offering. Its S-1 filing lists a $100 million placeholder number, a figure that will update when the company announces an IPO price range target.

This morning let’s explore the company’s financials briefly, and then ask ourselves what its results can tell us about the cloud market as a whole.

DigitalOcean’s financial results

TechCrunch has covered DigitalOcean with some frequency in recent years, including its early-2020 layoffs, its early-2020 $100 million debt raise and its $50 million investment from May of the same year that prior investors Access Industries and Andreessen Horowitz participated in.

From those pieces we knew that the company had reportedly reached $200 million in revenue during 2018, $250 million in 2019 and that DigitalOcean had expected to reach an annualized run rate of $300 million in 2020.

Those numbers held up well. Per its S-1 filing, DigitalOcean generated $203.1 million in 2018 revenue, $254.8 million in 2019 and $318.4 million in 2020. The company closed 2020 out with a self-calculated $357 million in annual run rate.

During its recent years of growth, DigitalOcean has managed to lose modestly increasing amounts of money, calculated using generally accepted accounting principles (GAAP), and non-GAAP profit (adjusted EBITDA) in rising quantities. Observe the rising disconnect:

#cloud, #cloud-infrastructure-market-share, #coinbase, #developer, #digital-ocean, #digitalocean, #enterprise, #exit, #fundings-exits, #ipo, #startups, #tc

0

Twitter’s ‘Super Follow’ creator subscription takes shots at Substack and Patreon

It’s been an all-around more ambitious year for Twitter. Following activist shareholder action last year that aimed to oust CEO Jack Dorsey, the company has been making long overdue product moves, buying up companies and aiming to push the envelope on how it can tap its network and drive new revenue streams. Things seem to be paying off for the company, as their share price sits at an all-time high — double that of its 2020 high.

Today, the company shared early details on its first ever paid product, a feature called “Super Follow” which aims to combine the community trends of Discord, the newsletter insights of Substack, the audio chat rooms of Clubhouse and the creator support of Patreon into a creator subscription. The company announced the service during its Analyst Day event Thursday morning.

Plenty of details are still up in the air for the feature, which notably does not have a launch timeline.

Image Credits: Twitter

Screenshots shared by Twitter showcase a feature that allows Twitter users to subscribe to their favorite creators for a monthly price (one screenshot details a $4.99 per month cost) and earn certain subscriber-only perks, including things like “exclusive content,” “subscriber-only newsletters,” “community access,” “deals & discounts,” and a “supporter badge” for subscribers. Creators in the program will also be able to paywall certain media they share, including tweets, fleets and chats they organize in Twitter’s Clubhouse competitor Spaces.

The company’s other big announcement of the event was “Communities,” a product that seems designed to compete with Facebook Groups but also will likely provide “Super Follow” networks a place to interact with creators in close cahoots.

Introducing paywalls into the Twitter feed could dramatically shift the mechanics of the service. Twitter has been pretty conservative over the years in building features that are intended for singular classes of users. Creator-focused features built for a network that is already home to so many creators could be a major threat to services like Patreon, which have largely popped up due to the lackluster monetization tools available from the big social platforms.

New revenue streams will undoubtedly be key to Twitter’s ambitious plan to double its revenues by 2023.

 

#analyst, #ceo, #clubhouse, #computing, #day, #discord, #facebook, #jack-dorsey, #operating-systems, #patreon, #paywall, #real-time-web, #software, #tc, #text-messaging, #twitter

0

Sergey Brin’s airship aims to use world’s biggest mobile hydrogen fuel cell

Sergey Brin’s secretive airship company LTA Research and Exploration is planning to power a huge disaster relief airship with an equally record-breaking hydrogen fuel cell.

A job listing from the company, which is based in Mountain View, California and Akron, Ohio, reveals that LTA wants to configure a 1.5-megawatt hydrogen propulsion system for an airship to deliver humanitarian aid and revolutionize transportation. While there are no specs tied to the job listing, such a system would likely be powerful enough to cross oceans. Although airships travel much slower than jet planes, they can potentially land or deliver goods almost anywhere.

Hydrogen fuel cells are an attractive solution for electric aviation because they are lighter and potentially cheaper than lithium-ion batteries. However, the largest hydrogen fuel cell to fly to date is a 0.25-megawatt system (250 kilowatts) in ZeroAvia’s small passenger plane last September. LTA’s first crewed prototype airship, called Pathfinder 1, will be powered by batteries when it takes to the air, possibly this year. FAA records show that the Pathfinder 1 has 12 electric motors and would be able to carry 14 people. 

That makes it about the same size as the only passenger airship operating today, the Zeppelin NT, which conducts sightseeing tours in Germany and Switzerland. The Pathfinder 1 also uses some Zeppelin components in its passenger gondola. 

LTA Research and Exploration airship patent

Image Credits: LTA Patent US 2019/0112023 A1

Since the Hindenburg disaster in 1937, most airships, including LTA’s, have used non-flammable helium as a lifting gas. But using hydrogen for fuel still makes sense, according to Professor Dr. Josef Kallo of the German Aerospace Center, which is developing its own 1.5 MW fuel cell to power a 60-seater regional electric aircraft. 

“Where we could go something like 125 miles with batteries, we should be able to go nearly 1,000 miles using hydrogen,” Kallo said. “And airships are even more perfect for the efficiency of fuel cells.”

Fuel cells combine hydrogen and oxygen to produce water and electricity, but are traditionally heavy and complex. Putting one in an aircraft adds extra complications such as safely transporting the liquid hydrogen in fuel tanks, storing the water produced and dealing with a lot of waste heat.

LTA’s first fuel cell will be a 0.75 MW system, built by a third party and retrofitted into one of its existing prototypes, according to the job listing. That is unlikely to happen this year, however. A planned Pathfinder 3 airship, which will run on batteries, still has not been registered with the FAA.

LTA Research and Exploration airship patent

Image Credits: LTA Research Patent US 2019/0112023 A1

“Functionality wise, there is no showstopper to using a hydrogen fuel cell,” Kallo said. “The challenge is to find someone who can afford not to look at the business case, because I don’t think it works out from an economic perspective. Maybe Sergey Brin can afford to do that.”

Brin is currently the ninth richest person in the world, with a net worth of over $86 billion. LTA’s website says the initial use case for its aircraft will be “humanitarian disaster response and relief efforts, especially in remote areas that cannot be easily accessed by plane and boat due to limited or destroyed infrastructure.” Ultimately, it intends to create a family of zero emissions aircraft for global cargo and passenger travel.

LTA has already started its charitable work, producing more than 3 million face masks for first responders during the COVID-19 pandemic, and donating nearly $3 million last year to the United Nations High Commissioner for Refugees.

LTA is likely to operate closely with Brin’s nonprofit disaster relief force, Global Support and Development (GSD), which is based just a few miles from LTA’s Mountain View hangars. GSD has deployed medics and ex-military personnel to numerous natural disasters over the past five years. It prides itself on its ability to arrive before traditional NGOs, on occasion even using Brin’s own superyacht. Tax records show that Brin is by far the largest funder of GSD, giving it at least $7.5 million in 2019. 

#google, #hydrogen, #lta-research-and-exploration, #sergey-brin, #tc, #transportation

0

Blue Origin pushes New Glenn orbital rocket’s first flight to Q4 2022

Jeff Bezos’ space company Blue Origin published an updated timeline for the first flight of New Glenn, the orbital rocket it’s building to complement its existing New Shepard suborbital space launch vehicle. The company is now targeting Q4 2022 – a slippage of roughly a year from the prior stated timeline of sometime towards the end of 2021. The main cause, per Blue Origin? Space Force passing on using New Glenn to launch national security payloads during a recent contract bid process.

Blue Origin said in a blog post that the “schedule has been refined to match the demand of Blue Origin’s commercial customers,” and specifically says it “follows the recent Space Force decision to not select New Glenn for the National Security Space Launch (NSSL) Phase 2 Launch Services Procurement (LSP).” Those awards were announced last August, and the two winners were the United Launch Alliance (ULA) and SpaceX, who prevailed over Blue Origin, and also Northrop Grumman. The launch service contracts that make up the awards begin in 2022, so it makes sense why Blue Origin had been pushing for a first launch of New Glenn by the end of this year in order to meet the needs of Space Force.

While it may not be under the same time pressure without access to those contracts, it’s still making “major progress” towards New Glenn and the facilities at Cape Canaveral in Florida from which it’ll launch, according to the company. Blue Origin shared tweets showing off some of its progress, including work on the New Glenn rocket factory, testing facility and Launch Complex 36. It also said it’s put more than $2.5 billion into the facilities and infrastructure that will support its eventual launches.

#aerospace, #blue-origin, #florida, #jeff-bezos, #new-shepard, #northrop-grumman, #outer-space, #science, #space, #space-force, #space-tourism, #spaceflight, #spacex, #tc, #united-launch-alliance

0

Learn about creating equity in tech with Rep. Barbara Lee at TechCrunch Sessions: Justice

Rep. Barbara Lee, who has represented the East Bay of California since 1998, is one of Congress’s staunchest proponents of diversity in tech. Representing Oakland, Emeryville and other cities nestled around the hills of the East Bay, she knows all too well about the benefits reaped by those in Silicon Valley, San Francisco and beyond.

We are happy to announce that Rep. Lee will be joining us for a fireside chat at TechCrunch Sessions: Justice in just a few days.

By focusing on racial injustice, among the many other issues facing her constituency, Lee has highlighted the ways in which access to tech remains out of reach for people from underserved communities. And this doesn’t just refer to the so-called ‘pipeline problem,’ which is, arguably, a myth. It is also about the lack of tech education in early grades through high school, as well as a lack of access to computers and reliable broadband, which most of us take for granted.

We will speak with Lee about the opportunities that the tech industry has to create an equal playing field in tech so that underrepresented investors, founders, designers, coders and the like can take part in everything it has to offer. We will also discuss her membership in the Congressional Black Caucus, which is celebrating its 50th anniversary this year, as well as her role as co-chair of the Congressional Cannabis Caucus — the burgeoning cannabis industry will be a good place to start.

Head here to secure your seat to TechCrunch Sessions: Justice. In addition to Rep. Lee, you’ll hear from Backstage Capital’s Arlan Hamilton on finding the next big opportunities in tech, learn how to creatively navigate remote fundraising from top investors, examine the importance of accessible product design and learn how to battle algorithmic bias. Register now.

 

#events, #rep-barbara-lee, #tc, #techcrunch-sessions-justice-2021

0

Foresite Capital raises $969 million fund to invest in healthcare startups across all stages of growth

Health and life science specialist investment firm Foresite Capital has raised a new fund, its fifth to date, totally $969 million in commitments from LPs. This is the firm’s largest fund to date, and was oversubscribed relative to its original target according to fund CEO and founder Dr. Jim Tananbaum, who told me that while the fundraising process started out slow in the early months of the pandemic, it gained steam quickly starting around last fall and ultimately exceeded expectations.

This latest fund actually makes up two separate investment vehicles, Foresite Capital Fund V, and Foresite Capital Opportunity Fund V, but Tananbaum says that the money will be used to fuel investments in line with its existing approach, which includes companies ranging from early- to late-stage, and everything in between. Foresite’s approach is designed to help it be uniquely positioned to shepherd companies from founding (they also have a company-building incubator) all the way to public market exit – and even beyond. Tananbaum said that they’re also very interested in coming in later to startups they have have missed out on at earlier stages of their growth, however.

Image Credits: Foresite Capital

“We can also come into a later situation that’s competitive with a number of hedge funds, and bring something unique to the table, because we have all these value added resources that we used to start companies,” Tananbaum said. “So we have a competitive advantage for later stage deals, and we have a competitive advantage for early stage deals, by virtue of being able to function at a high level in the capital markets.”

Foresite’s other advantage, according to Tananbaum, is that it has long focused on the intersection of traditional tech business mechanics and biotech. That approach has especially paid off in recent years, he says, since the gap between the two continues to narrow.

“We’ve just had this enormous believe that technology, and tools and data science, machine learning, biotechnology, biology, and genetics – they are going to come together,” he told me. “There hasn’t been an organization out there that really speaks both languages well for entrepreneurs, and knows how to bring that diverse set of people together. So that’s what we specialized i,n and we have a lot of resources and a lot of cross-lingual resources, so that techies that can talk to biotechies, and biotechies can talk to techies.”

Foresite extended this approach to company formation with the creation of Foresite Labs, an incubation platform that it spun up in October 2019 to leverage this experience at the earliest possible stage of startup founding. It’s run by Dr. Vik Bajaj, who was previously co-founder and Chief Science Officer of Alphabet’s Verily health sciences enterprise.

“What’s going on, or last couple decades, is that the innovation cycles are getting faster and faster,” Tananbaum said. “So and then at some point, the people that are having the really big wins on the public side are saying, ‘Well, these really big wins are being driven by innovation, and by quality science, so let’s go a little bit more upstream on the quality science.’”

That has combined with shorter and shorter healthcare product development cycles, he added, aided by general improvements in technology. Tananbaum pointed out that when he began Foresite in 2011, even, the time horizons for returns on healthcare investments were significantly longer, and at the outside edge of the tolerances of venture economics. Now, however, they’re much closer to those found in the general tech startup ecosystem, even in the case of fundamental scientific breakthroughs.

CAMBRIDGE – DECEMBER 1: Stephanie Chandler, Relay Therapeutics Office Manager, demonstrates how she and her fellow co-workers at the company administer their own COVID tests inside the COVID testing room at Relay Therapeutics in Cambridge, MA on Dec. 1, 2021. The cancer treatment development company converted its coat room into a room where employees get tested once a week. All 100+employees have been back in the office as a result of regular testing. Relay is a Foresite portfolio company. (Photo by Jessica Rinaldi/The Boston Globe via Getty Images)

“Basically, you’re seeing people now really look at biotech in general, in the same kind of way that you would look at a tech company,” he said. “There are these tech metrics that now also apply in biotech, about adoption velocity, other other things that may not exactly equate to immediate revenue, but give you all the core material that usually works over time.”

Overall, Foresite’s investment thesis focuses on funding companies in three areas – therapeutics at the clinical stage, infrastructure focused on automation and data generation, and what Tananbaum calls “individualized care.” All three are part of a continuum in the tech-enabled healthcare end state that he envisions, ultimately resulting “a world where we’re able to, at the individual level, help someone understand what their predispositions are to disease development.” That, Tananbaum suggests, will result in a transformation of this kind of targeted care into an everyday consumer experience – in the same way tech in general has taken previously specialist functions and abilities, and made them generally available to the public at large.

#alphabet, #articles, #biotech, #biotechnology, #ceo, #corporate-finance, #economy, #entrepreneurship, #finance, #foresite-capital, #fund, #fundings-exits, #health, #innovation, #investment, #jim-tananbaum, #machine-learning, #private-equity, #startup-company, #tc, #venture-capital, #vik-bajaj

0

Five takeaways from Coinbase’s S-1

The Coinbase S-1 is out! And hot damn, did the company have a good fourth quarter.

TechCrunch has a first look at the company’s headline numbers. But in case you’ve been busy, the key things to understand are that Coinbase was an impressive company in 2019 with more than a half-billion in revenue and a modest net loss. In 2020, the company grew sharply to more than $1.2 billion in revenue, providing it with lots of net income.


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The company’s Q4 2020 was about as big as its entire 2019 in revenue terms, albeit much more profitable because the sum was concentrated in a single quarter instead of spread out over four.

However, beyond the top-level numbers are a host of details to explore. I want to dig more deeply into Coinbase’s user numbers, its asset mix, its growing subscription incomes, its competitive landscape and who owns what in the company. At the end, we’ll riff on a chart that discusses the correlation between crypto assets and the stock market, just for fun.

Sound good? You can read along in the S-1 here if you want, and I will provide page numbers as we go.

Inside Coinbase’s direct listing

To make things simpler, we’ll frame our digging in the form of questions, starting with: How many users did Coinbase need to generate its huge 2020 revenue gains?

The answer: not as many as I expected. In 2019, Coinbase generated $533.7 million from what it describes as 1 million “Monthly Transacting Users” (page 14). That works out to $533.7 million in revenue per MTU for the year.

In 2020, Coinbase generated $1.28 billion in revenue off of 2.8 million MTUs, which works out to around $457 apiece during the year. That’s a bit lower, but not terribly so. And given that the company’s transaction margins ranged in the mid-80s percent during much of 2020, each Coinbase active trader was still quite valuable, even at a lower revenue point.

As we noted in our first look at the company’s economics, Coinbase’s metrics are highly variable. Its MTU figure is no exception. Observe the following chart from its S-1 filing (page 95):

Coinbase’s Q1 2018 was nearly as popular in MTU terms as its final quarter of 2020. And from that point in time, the company’s MTUs fell 70 percent to its Q1 2019 nadir. That’s a lot of variance.

The company itself notes in its filing that “MTUs have historically been correlated with both the price of Bitcoin and Crypto Asset Volatility,” though the company does point out that it expects such correlations to diminish over time.

The answer to our question is that it only takes a few million MTUs for Coinbase to be a huge business. But the other side of that point is that Coinbase has shown twice in two years (2018, 2019) that the number of traders on its platform can decline.

What assets do Coinbase users hold? This is a question that I am sure many of you crypto enthusiasts have. But first, what does the Coinbase user asset base look like? Like this, historically (page 96):

Holy shit, right? The chart shows two things. First, the rapid appreciation of cryptocurrencies overall, which you can spy in the upward kick of the black line. And then the blue bars show how the assets on Coinbase’s platform grew from $17 billion at the start of 2020 to $90 billion by year’s end.

#a16z, #coinbase, #cryptocurrencies, #direct-listing, #ec-column, #ec-fintech, #finance, #fundings-exits, #startups, #tc

0

How top startup lawyer Dawn Belt thinks about company-building in the age of SPACs

Dawn Belt has been working with top tech companies for two decades, most recently helping commercial electric vehicle company Proterra go public as a SPAC in January.

Now she’ll be joining us at TC Early Stage in April to talk about building a company in 2021, from however you incorporate to however you decide to maybe go public one day.

As a partner at Fenwick & West, a top Silicon Valley law firm, Belt works with startups of all ages, sizes and industries (two of her past IPOs include Facebook and Bill.com). She has also written legal perspectives on a wide range of other topics that startups face, including implications of the CARES Act, board diversity legal requirements and how to manage acquired startups successfully. She also co-authored the firm’s Gender Diversity Survey, an in-depth report on women’s participation at senior levels of public tech companies.

She’ll be at Early Stage to share her experiences old and new, to help you make better decisions now for your company. The talk is part of the two days of events that explore seed and Series A fundraising, recruiting and more for early-stage startups at TC Early Stage – Operations and Fundraising on April 1 & 2. Grab your ticket now before prices increase tomorrow!

 

#dawn-belt, #events, #spac, #startups, #tc, #tc-early-stage-2021

0

The Landing is bringing shoppable social and collaboration to interior design

Monetizable mood boards might sound like the moonshot idea that no one asked for, but when you think about it, the vision is already informally happening in various corners of the internet. A young generation of users shops with community in mind, whether that’s buying merchandise from your favorite influencers or giving into those Instagram advertisements after spending way too much time on the grid.

As more users think of shopping as a social, digital-first activity, The Landing, a seed-stage startup coming out of stealth, is hoping to win over those who have an affinity for designing homes and spaces. On The Landing, users can create, and shop from, room designs to help furnish their homes.

Image Credits: The Landing

“There’s no contextually rich, visual shopping destination, where you could curate and discover and share and shop all in one place,” co-founder Miri Buckland said. The Landing hopes to be that destination.

Started by Buckland and Ellie Buckingham, The Landing is launching with $2.5 million in financing, in a round led by Aileen Lee at Cowboy Ventures. Lee will be taking a board seat. Other investors include Dara Treseder, the CMO of Peloton, Manish Chandra and Tracy Sun, the founders of Poshmark, Unshackled, Designer Fund, and Progression Fund.

The Landing began as a pandemic pivot. Buckland and Buckingham were always interested in solving the pain point of contextual furnishing for users, but began by physically moving people into apartments and helping them set up different furniture. Then, the pandemic hit and limited the ability to do high-touch services. Buckingham says that this was “potentially the best forcing function” to focus on what kind of business The Landing wanted to be.

“I don’t need to be the person moving into your apartment with a couch,” she said. “It was about the importance of empowering creativity and empowering individuals to create digital and physical spaces.” That’s when they dropped the moving service business, and instead used furnishing as a vector to solve the problem of contextual and social e-commerce.

It’s a smart idea that has not gone unnoticed. Houzz, a Sequoia-backed home improvement startup, connects users to products from third-party retailers as well as services from architects, designers, or contractors. There’s also Modsy, which has raised north of $70 million to date, which helps users virtually redesign their homes.

Buckingham worked for Modsy when she was at business school, where she first started noticing that she disagreed with the startups’ main thesis.

“Their motto was basically a digital rendition of an existing human service,” she said. “And I came away from the experience not super convinced that the service model was the scalable, future answer to consumerization of access to design.” She noticed that the younger generation was looking for a self-serve, customizable answer, instead.

Miri Buckland and Ellie Buckingham, the co-founders of The Landing.

The Landing is launching with creative tooling capabilities, which allow users to build and design spaces within its platform. In the coming months, the team is focused on adding a social layer atop the design tool, with features like profiles, discovery, fede, and commenting.

The Landing’s Slack channel is currently being used to discuss these features and what is most in-demand from early users.

The founders aren’t worried about a lack of demand, or only being a platform for the few times that people furnish their homes throughout their lifespan. As Buckland pointed out, people browse Zillow all the time, and have Reddit channels about dream homes, creating designs, and more. The startup is aiming to serve that population as well — the dreamers and not just the realists.

#early-stage, #interior-design, #modsy, #real-estate, #tc, #the-landing

0

Why F5 spent $2.2B on 3 companies to focus on cloud native applications

It’s essential for older companies to recognize changes in the marketplace or face the brutal reality of being left in the dust. F5 is an old-school company that launched back in the 90s, yet has been able to transform a number of times in its history to avoid major disruption. Over the last two years, the company has continued that process of redefining itself, this time using a trio of acquisitions — NGINX, Shape Security and Volterra — totaling $2.2 billion to push in a new direction.

While F5 has been associated with applications management for some time, it recognized that the way companies developed and managed applications was changing in a big way with the shift to Kubernetes, microservices and containerization. At the same time, applications have been increasingly moving to the edge, closer to the user. The company understood that it needed to up its game in these areas if it was going to keep up with customers.

Taken separately, it would be easy to miss that there was a game plan behind the three acquisitions, but together they show a company with a clear opinion of where they want to go next. We spoke to F5 president and CEO François Locoh-Donou to learn why he bought these companies and to figure out the method in his company’s acquisition spree madness.

Looking back, looking forward

F5, which was founded in 1996, has found itself at a number of crossroads in its long history, times where it needed to reassess its position in the market. A few years ago it found itself at one such juncture. The company had successfully navigated the shift from physical appliance to virtual, and from data center to cloud. But it also saw the shift to cloud native on the horizon and it knew it had to be there to survive and thrive long term.

“We moved from just keeping applications performing to actually keeping them performing and secure. Over the years, we have become an application delivery and security company. And that’s really how F5 grew over the last 15 years,” said Locoh-Donou.

Today the company has over 18,000 customers centered in enterprise verticals like financial services, healthcare, government, technology and telecom. He says that the focus of the company has always been on applications and how to deliver and secure them, but as they looked ahead, they wanted to be able to do that in a modern context, and that’s where the acquisitions came into play.

As F5 saw it, applications were becoming central to their customers’ success and their IT departments were expending too many resources connecting applications to the cloud and keeping them secure. So part of the goal for these three acquisitions was to bring a level of automation to this whole process of managing modern applications.

“Our view is you fast forward five or 10 years, we are going to move to a world where applications will become adaptive, which essentially means that we are going to bring automation to the security and delivery and performance of applications, so that a lot of that stuff gets done in a more native and automated way,” Locoh-Donou said.

As part of this shift, the company saw customers increasingly using microservices architecture in their applications. This means instead of delivering a large monolithic application, developers were delivering them in smaller pieces inside containers, making it easier to manage, deploy and update.

At the same time, it saw companies needing a new way to secure these applications as they shifted from data center to cloud to the edge. And finally, that shift to the edge would require a new way to manage applications.

#cloud, #cloud-native, #ec-cloud-and-enterprise-infrastructure, #enterprise, #f5, #kubernetes, #ma, #nginx, #shape-security, #tc, #volterra

0

DataJoy raises $6M seed to help SaaS companies track key business metrics

Every business needs to track fundamental financial information, but the data typically lives in a variety of silos making it a constant challenge to understand a company’s overall financial health. DataJoy, an early stage startup, wants to solve that issue. The company announced a $6 million seed round today led by Foundation Capital with help from Quarry VC, Partech Partners, IGSB, Bow Capital and SVB.

Like many startup founders, CEO Jon Lee has experienced the frustration first hand of trying to gather this financial data, and he decided to start a company to deal with it once and for all. “The reason why I started this company was that I was really frustrated at Copper, my last company because it was really hard just to find the answers to simple business questions in my data,” he told me.

These include basic questions like how the business is doing this quarter, if there are any surprises that could throw the company off track and where are the best places to invest in the business to accelerate more quickly.

The company has decided to concentrate its efforts for starters on SaaS companies and their requirements. “We basically focus on taking the work out of revenue intelligence, and just give you the insights that successful companies in the SaaS vertical depend on to be the largest and fastest growing in the market,” Lee explained.

The idea is to build a product with a way to connect to key business systems, pull the data and answer a very specific set of business questions, while using machine learning to provide more proactive advice.

While the company is still in the process of building the product and is pre-revenue, it has begun developing the pieces to ultimately help companies answer these questions. Eventually it will have a set of connectors to various key systems like Salesforce for CRM, HubSpot and Marketo for marketing, Netsuite for ERP, Gainsight for customer experience and Amplitude for product intelligence.

Lee says the set of connectors will be as specific as the questions themselves and based on their research with potential customers and what they are using to track this information. Ashu Garg, general partner at lead investor Foundation Capital says that he was attracted to the founding team’s experience, but also to the fact they were solving a problem he sees all the time sitting on the boards of various SaaS startups.

“I spend my life in the board meetings. It’s what I do, and every CEO, every board is looking for straight answers for what should be obvious questions, but they require this intersection of data,” Garg said. He says to an extent, it’s only possible now due to the evolution of technology to pull this all together in a way that simplifies this process.

The company currently has 11 employees with plans to double that by the middle of this year. As a long-time entrepreneur, Lee says that he has found that building a diverse workforce is essential to building a successful company. “People have found diversity usually [results in a company that is] more productive, more creative and works faster,” Lee said. He said that that’s why it’s important to focus on diversity from the earliest days of the company, while being proactive to make that happen. For example, ensuring you have a diverse set of candidates to choose from when you are reviewing resumes.

For now, the company is 100% remote. In fact, Lee and his co-founder Chief Product Officer Ken Lee, who was previously at Tableau, have yet to meet in person, but they are hoping that changes soon. The company will eventually have a presence in Vancouver and San Mateo whenever offices start to open.

#data, #datajoy, #enterprise, #funding, #machine-learning, #recent-funding, #saas, #startups, #tc

0

Terminus raises $90M to grow its B2B marketing platform, now valued at around $400M

Sales and marketing are often considered a single category on a business plan, but ironically, when it comes to building apps and services to help with them, they usually become separate entities, and so too do the teams that address sales and marketing in organizations. Today, however, a startup called Terminus — which is building a platform that views sales and marketing in a more integrated way, through account-based marketing — is announcing funding and growth, a sign of how its approach is gaining more traction.

The startup has closed a Series C of $90 million, at a valuation we understand from sources to be around $400 million. This is a huge jump on Terminus’s valuation in its last round, which was $96 million post-money in 2018, according to PitchBook data.

Part of the reason for the hike is likely because of the huge focus that digital marketing has had especially in the last year — a time when, because of the pandemic, a lot of more legacy and traditional channels have ceased to be as visible). Account-based marketing alone was estimated, in 2018, to be a $458 billion market opportunity.

Another reason for interest in Terminus specifically is because of its customer record within that. It has around 1,000 enterprise customers, including divisions of IBM, Salesforce, Thomson Reuters, and more.

“We’re building the new marketing automation,” said CEO Tim Kopp in an interview. “We think account-based marketing is the most important thing to have happened in sales software. Teams are switching from lead-based to account-based approaches, and we’ve now moved into addressing all points of engagement, a modern B2B marketing cloud.”

The equity round is being led by Great Hill Partners, with previous investors Atlanta Ventures and Edison Partners, and new backer Hallet Capital also participating. The funding brings the total raised by Terminus — co-headquartered in Atlanta, GA and Indianapolis, IN — to about $120 million.

The world of marketing has seen a huge shift in the two decades, with the rise in internet consumption, and the proliferation of digital services, driving a big business in what is now collectively called “martech”.

The area that Terminus specifically focuses on within that is account-based marketing. In short, this is a way for B2B sales and marketing teams to conceive of potential targets at a business not as individual entities but collective groups. This means a more joined up effort to work across whole organizations, providing a way to market something to more than one person, increasing the chances of connecting with someone to then make the sale.

Terminus’ platform and approach, CEO Kopp points out, essentially brings the functions of sales and marketing together, instead of needing to hand off work from one to the other (eliminating the admin and cost of working across different software within those groups as part of that).

“We see an overwhelming opportunity in bringing together marketing and sales,” he said in an interview. “Marketing is joining in on sales meetings and sales has become a part of the client success, where you are marketing to your own customers. It’s an area where customers stink because they typically come at it from the sales or marketing side.”

Terminus’ platform today consists of a “data studio” that brings together sales intelligence, account information, and other data sources to help compile a list of would-be targets. On top of this, it also has been building out a marketing engine that includes the ability to build advertising, email and web campaigns, and chatbot management. Some of this has been built in-house, and some has come to the company by way of acquisitions (for example the chat functionality comes by way of its acquisition of Ramble last April).

Terminus is by far not the only company working in this area. Others include Marketo (part of Adobe), 6sense, Sendoso and many others. Terminus’s approach is to bring different aspects of the marketing and sales process (analytics, orchestration, automation and execution) into one platform.

Fittingly, the startup’s name was based on an early nickname for Atlanta, and used as a reference to its aim of being the single for its customers’ various marketing and sales activities.

This is one reason why investors have been knocking.

“Terminus continues to redefine how teams go to market, innovating how companies generate revenue in a digital-first environment,” said Derek Schoettle, a growth partner at Great Hill. “We’ve been so impressed with this team, the company’s significant growth over the last year, its continued product innovation, and the huge market opportunity ahead.”

#tc

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Berlin’s MorphAIs hopes its AI algorithms will put its early-stage VC fund ahead of the pack

MorphAIs is a new VC out of Berlin, aiming to leverage AI algorithms to boost its investment decisions in early-stage startups. But there’s a catch: it hasn’t raised a fund yet.

The firm was founded by Eva-Valérie Gfrerer who was previously head of Growth Marketing at FinTech startup OptioPay and her background is in Behavioural Science and Advanced Information Systems.

Gfrerer says she started MorphAIs to be a tech company, using AI to assess venture investments and then selling that as a service. But after a while, she realized the platform could be applied an in-house fund, hence the drive to now raise a fund.

MorphAIs has already received financing from some serial entrepreneurs, including: Max Laemmle, CEO & Founder Fraugster, previously Better Payment and SumUp; Marc-Alexander Christ, Co-Founder SumUp, previously Groupon (CityDeal) and JP Morgan Chase; Charles Fraenkl, CEO SmartFrog, previously CEO at Gigaset and AOL; Andreas Winiarski, Chairman & Founder awesome capital Group.

She says: “It’s been decades since there has been any meaningful innovation in the processes by which venture capital is allocated. We have built technology to re-invent those processes and push the industry towards more accurate allocation of capital and a less-biased and more inclusive start-up ecosystem.”

She points out that over 80% of early-stage VC funds don’t deliver the minimum expected return rate to their investors. This is true, but admittedly, the VC industry is almost built to throw a lot of money away, in the hope that it will pick the winner that makes up for all the losses.

She now plans to aim for a pre-seed/seed fund, backed by a team consisting of machine learning scientists, mathematicians, and behavioral scientists, and claims that MorphAIs is modeling consistent 16x return rates, after running real-time predictions based on market data.

Her co-founder is Jan Saputra Müller, CTO and Co-Founder, who co-founded and served as CTO for several machine learning companies, including askby.ai.

There’s one problem: Gfrerer’s approach is not unique. For instance, London-based Inreach Ventures has made a big play of using data to hunt down startups. And every other VC in Europe does something similar, more or less.

Will Gfrerer manage to pull off something spectacular? We shall have to wait and find out.

#artificial-intelligence, #berlin, #ceo, #chairman, #chase, #citydeal, #co-founder, #cto, #economy, #europe, #finance, #head, #inreach-ventures, #jp-morgan-chase, #london, #machine-learning, #money, #sumup, #tc, #venture-capital

0

With Atlanta rising as a new hub for tech, early stage firm Tech Square Ventures gets a new partner

Atlanta is coming up in the tech world with several newly minted billion-dollar businesses hailing from the ATL and the city’s local venture capital community is taking notice.

Even as later stage firms like the newly minted BIP Capital rebrand and  with increasingly large funds, earlier stage firms like Tech Square Ventures are staffing up and adding new partners.

The firm’s latest hire is Vasant Kamath, a general partner who joins the firm from Primus Capital, a later stage investment vehicle based out of Atlanta. Before that, he was managing investments for the private office of the Cox family.

Originally from Augusta, Ga. Kamath left the south to attend Harvard and then went out west for a stint at Stanford Business School.

In between his jaunts North and West Kamath spent time in Atlanta as an investment banker with Raymond James in the early 2000s, the beginnings of a lifelong professional career in technology. Before business school, Kamath worked at Summit Equity Partners in Boston investing in later stage technology companies.

Kamath settled in Atlanta in 2010 just as a second wave of technology companies began making their presence felt in the city.

The new Tech Square Village general partner pointed to Atlanta’s underlying tech infrastructure as one reason for the move to early stage. One pillar of that infrastructure is Georgia Tech itself. The school, whose campus abuts the Tech Square Ventures offices, is one of the top engineering universities in the country and the breadth of talent coming out of that program is impressive, Kamath said.

There’s also the companies like Airwatch, MailChimp, Calendly and others that represent the resurgence of Atlanta’s tech scene, Tech Square Ventures’ newest general partner said.

Not only are young companies reinvesting in the city, but big tech giants and telecom players like T-Mobile, Google, and Microsoft are also establishing major offices, accelerators, and incubators in Atlanta.

“There’s a lot of momentum here in early stage and i think it’s building. It’s the right time for a firm like TSV to take advantage of all of the things,” Kamath said. 

Another selling point for making the jump to early stage investing was the relationship that Kamath had established with Tech Square Ventures founder, Blake Patton. A serial entrepreneur who’s committed to building up Atlanta’s startup ecosystem, Patton has been the architect of Tech Square Ventures’ growth through two separate initiatives.

In all, the firm has $90 million in assets under management. What began with a small pilot fund, Tech Square Ventures Fund 1, (a $5 million investment vehicle) has expanded to include two larger funds raised in conjunction with major industrial corporate partners like AT&T, Chick-Fil-A, Cox Enterprises, Delta, Georgia-Pacific, Georgia Power, The Home Depot, UPS, Goldman Sachs, and Invesco, under the auspices of a program called Engage. Those funds total $54 million in AUM and the firm is halfway toward closing a much larger second flagship fund under the Tech Square Ventures name with a $75 million target.

All this activity has led to a blossoming entrepreneurial community that early stage funds like Tech Square Ventures hopes to tap.

“We see a fair number of folks from these large corporations spinning out and starting things themselves,” said Kamath. “For a decade plus, you have multiple entrepreneurs doing really well and increasing acceleration in terms of climate and exits.”

And more firms from outside of the region are beginning to take notice.

“I think that is happening,” said Kamath. “You might seen investment from outside the region. At the seed stage it’s harder you do need to have feet on the ground right when they’re starting and building their business. Once they’ve been vetted and had that early round of investment you will definitely see a lot of activity. We’re seeing more investment at the Series A and B from out of town. That’s the strategy.”

It all points to a burgeoning startup scene that’s based in a collaborative approach, which should be good not only for Tech Square Ventures, but the other early stage funds like Atlanta Ventures, Outlander Labs, BLH Ventures, Knoll Ventures and Overline, that working to support the city’s entrepreneurs, Kamath said.

#airwatch, #att, #atlanta, #bip-capital, #boston, #calendly, #chick-fil-a, #corporate-finance, #cox-enterprises, #delta, #entrepreneurship, #finance, #georgia, #goldman-sachs, #google, #harvard, #invesco, #investment-banker, #knoll-ventures, #mailchimp, #microsoft, #money, #private-equity, #serial-entrepreneur, #t-mobile, #tc, #tech-square-ventures, #technology, #venture-capital

0

Boosted by the pandemic, meeting transcription service Otter.ai raises $50M

Over the past year or so, voice transcription startup Otter.ai doubled down on the future of remote work by integrating its product with meeting apps like Zoom and Google Meet. With the COVID-19 pandemic having sent so many to work from home, those investments have paid off — the company has transcribed over 100 million meetings with more than 3 billion minutes, and has seen an 8x increase in revenues during 2020. Now, Otter.ai is announcing its next steps, fueled by a new $50 million Series B round of investment.

The new round was led by Spectrum Equity, with participation from existing investors Horizons Ventures, Draper Associates, GGV Ventures, Draper Dragon Fund, and others. The $50 million figure also includes a $10 million convertible note, announced last year.

Otter.ai’s service offers an easy way to record meetings, whether in-person through an app on your phone, or online through its integrations with popular web conferencing apps. But it’s the latter that really came into play over the course of 2020, when suddenly entire workforces were sent home from the office and forced into endless Zoom calls.

With convenient timing, Otter.ai added Zoom integration back in April 2020 — the early days of the pandemic. It has now become the most popular platform for Otter.ai’s web conferencing users.

“I think with the pandemic, we’ve seen a huge shift in consumer behavior — especially in meeting behavior and education behavior, which are two key use cases for Otter,” says Otter.ai CMO Kurt Apen. “You see a lot of teams that are using Otter in the business and you see a lot of students and universities that are using Otter for accessible. And we think that shift in behavior is going to be permanent,” he notes.

Though the company doesn’t talk user numbers or revenues, specifically, it claims to have “many millions” on its standalone product, not counting the users it reaches through Zoom. And as those users discover Otter.ai’s free service, many later upgrade to its premium plans, which include the ability to record more minutes and access other business-grade features.

To date, this sort of backdoor entry point to the corporate market — through individual employees first, not the companies — has somewhat mirrored the trajectories of other popular business apps, the company believes.

“Actually, if we look at our growth trajectory in the last few year, it matches pretty well against the growth trajectory of Slack and Zoom,” said Otter.ai founder and CEO, Sam Lian. “So we’re pretty confident that, in the next few year, we’re continuing to grow.”

In other words, Otter.ai’s adoption may have been accelerated by the pandemic, but the larger impacts to business culture that took place in 2020 aren’t going away even when the pandemic ends. Not everyone will be going back to the office. But for those who do, Otter can work there, too.

The company has found some traction with businesses like professional services, pharmaceutical companies, financial services, and other multinationals where employees work across time zones. Longer-term, Otter.ai aims to better serve its corporate use cases by extending beyond meeting transcripts into an area it likes to call “conversation intelligence.”

That involves leveraging A.I. technology to extract meaning from the transcripts by allowing the system to learn what’s important based on the time spent on topics, the intonation of voices, and the sentiment of the conversations. It would do this in an automated way, as well, much like it works today.

Otter.ai, however, is not a service meant for highly confidential conversations. The recorded conversation is encrypted in transit and at rest, but is decrypted while processing. The conversations also have to be decrypted to create the index. Plus, Otter.ai transcripts are used as training data to improve its accuracy — learning from users’ manual corrections, from new accents, and the like.

This could ultimately prove to be a limiting factor to large-scale adoption within more sensitive business contexts. But Otter, nevertheless, remains focused more so on its work-related uses cases for the time being, rather than the numerous other areas where its technology can be used —  like podcast transcriptions, integrations with social audio apps (like Clubhouse), online events, and more. Otter.ai is serving these markets, but it’s preparing to staff up in sales to gain more corporate clients.

In addition to sales, where it also expects to hire a VP of Sales, Otter plans to grow its now 25-person team with additions across R&D, marketing, A.I. science, backend and frontend engineering, design, and product management. By year-end, it believes it will triple its headcount with the new hires — some of which may be remote workers.

Otter.ai will also invest the new funds into raising awareness for its app through channels like social and search, content marketing, organic social and more. And it will work to grow revenues through continued free to paid conversations and develop its technology.

John Connolly, Managing Director at Spectrum Equity, has now joined Otter’s board.

“As the workplace has evolved and online meetings are the new normal, Otter.ai is at the
forefront leading the transformational shift of the future of work and more effective online
interactions,” he said, in a statement. “We are thrilled to be partnering with Sam and the entire team at Otter.ai to support the company’s continued market leadership. We look forward to providing the guidance and strategic resources to drive focused product innovation and operational growth.”

#tc

0

Coinbase files to go public in a key listing for the cryptocurrency category

This morning Coinbase, an American cryptocurrency exchange, released an S-1 filing ahead of its direct listing. The company’s public debut has been hotly anticipated thanks to recent activity amongst bitcoin and other blockchain-based assets, the company’s controversial political positions, and its spiking valuation on private exchanges.

Coinbase’s financials show a company that grew rapidly from 2019 to 2020. More than that, the company also crossed the threshold into unadjusted profitability; it’s common amongst quickly-growing tech companies to lean more heavily on adjusted profit and other more flattering metrics.

In 2019 Coinbase $30.4 million against $533.7 million in revenue. In 2020 the company’s net income rose to $127.5 million against $1.28 billion in revenue.

The crypto unicorn grew just over 139% in 2020, a massive improvement on its 2019 results. The company’s scale and growth help us understand why some investors are bidding its value up to as much as $100 billion on the private markets.

Coinbase has highly variable revenues. The company posted revenues of $190.6 million in Q1 2020, a number that dipped to $186.4 million in the second quarter. Then Coinbase’s topline accelerated in Q3 2020 to $315.4 million, and $585.1 million in the final quarter of 2020.

It’s easy to see why Coinbase is moving forward with its direct listing now; the company just posted an excellent quarter.

In that outsized fourth-quarter period, Coinbase generated operating income of $226.6 million, and net income of $176.8 million. Those represent high-quality profitability improvements from preceding periods, and provide Coinbase with attractive end-of-year profit margins.

The cryptocurrency exchange generates the vast majority of its revenues from transaction revenues, as anticipated. Coinbase also has a comparatively modest “subscription and services” revenue category, which was worth around $20.7 million in Q4 2020 revenues.

Finally, Coinbase swun from operating cash flow negative in 2019 to incredibly cash-flow positive in 2020. However, the $3.0 billion in positive operating cash flow that Coinbase generated last year includes “$2.7 billion related to cash from the change in custodial funds due to customers,” diminishing the number to a more understandable scale.

This is a first look, but Coinbase is a quickly growing, profitable unicorn that looks more than ready for its direct listing. The question ahead of investors is merely how to value Coinbase’s revenue growth as it does track with broader market interest in cryptocurrencies, a historically fluid quantity.

#bitcoin, #coinbase, #crypto, #cryptocurrency, #direct-listing, #exit, #fundings-exits, #public-markets, #startups, #tc

0

Customer data platform Lexer raises $25.5M Series B for global expansion

Left to right: Lexer founders Dave Whittle, Aaron Wallis, Chris Brewer

Left to right: Lexer founders Dave Whittle, Aaron Wallis, Chris Brewer

The massive shift to online shopping during the COVID-19 pandemic means retailers need to analyze customer data quickly in order to compete against rivals like Amazon. Lexer, a customer data platform headquartered in Melbourne, Australia, helps brands manage data by organizing it on one platform, making analysis easier for small to medium-sized brands. The company announced today that it has raised $25.5 million in Series B funding for expansion in Australia, the United States and Southeast Asia.

The round was led by Blackbird Ventures and King River Capital, with participation from returning investor January Capital, and brings Lexer’s total raised so far to $33 million. Blackbird Ventures co-founder and partner Rick Baker will join Lexer’s board.

The company was founded in 2010 by Aaron Wallis, Chris Brewer and Dave Whittle, and its clients include Quiksilver, DC Shoes, John Varvatos and Sur La Table. The new funding will be used to add 50 more people to Lexer’s team, with plans to double its headcount in Australia, the U.S. and Southeast Asia. Whittle, the company’s chief executive officer, told TechCrunch it will also add more features to provide retailers with enterprise-grade customer data, insight, marketing, sales and service capabilities.

Brands use Lexer to increase their incremental sales, which includes sales to both existing and new customers, by helping them understand things like shopping patterns among different groups of visitors, which customers are most likely to make future purchases and what marketing strategies results in the most sales.

Lexer’s best-known competitors include Segments, which was acquired by Twilio for $3.2 billion last year, and Adobe Analytics. Whittle said Lexer’s key differentiator is providing an end-to-end solution.

While brands often have to use multiple data and analytics software to understand data from different sources, Lexer’s goal is to make everything accessible in one platform. “Our customers don’t have to engage expensive and time-consuming third parties for strategy, implementation, customization and project management,” he said.

Before Lexer’s Series B, most of its growth came from single brands, or groups of mid-market retail brands. Now it’s focusing on working with all sizes of brands, Whittle added.

The pandemic has forced many brands to place a greater emphasis on digital engagement to increase their online sales and stand out from other e-commerce merchants.

“There are literally hundreds of tactics we have enabled our customers to deploy to help them adapt to the limitations and barriers COVID put in place. For example, we helped retailers migrate offline customers to shop on their e-commerce sites,” said Whittle. “Another way was that if stock was low due to supply constraints caused by COVID, we helped retailers target their high-value and loyal customers to ensure customers satisfaction.”

#australia, #customer-data-platform, #ecommerce, #fundings-exits, #lexer, #startups, #tc

0

Allbirds is investing in plant-based leather substitute as it looks to further green its supply chain

The sustainability focused shoe maker Allbirds has taken another step to green its supply chain with a small $2 million investment in a new company called Natural Fiber Welding.

Announced this morning, the investment in Natural Fiber Welding will see Allbirds bring a vegan leather replacement option to customers by December 2021. It’s a natural addition for a company that has always billed itself as focused on environmental impact in other aspects of its apparel manufacturing.

Allbirds these days is far more than a shoe company and Natural Fiber Weldings suite of products that include both a purportedly tougher cotton fiber made using the company’s proprietary processing technology and a plant-based leather substitute.

Those materials could find their way into Allbirds array of socks, shoes, tshirts, underwear, sweaters, jackets, and face masks. Natural Fiber Welding already touts a relationship with Porsche on its website, so Allbirds isn’t the only company that’s warmed to the Peoria, Ill.-based startup’s new materials.

With the addition of Allbirds Natural Fiber Welding has raised roughly $15 million, according to data from Pitchbook. Other investors in the company include Central Illinois Angels, Prairie Crest Capital, Ralph Lauren Corp. and Capital V, an investment firm focused on backing vegan products.

Allbirds is far from the only clothier to make the jump to plant-based materials in the past year. The buzzy clothing company Pangaia invested $2 million into a company called Kintra which is making a bio-based polyester substitute in December.

By the far the biggest startup name in the sustainable fashion space is a company like Bolt Threads, which has inked deals with companies including Stella McCartney, Adidas, and the owner of the Balenciaga fashion house (among others).

Other startups that have raised significant capital for plant-based fabrics and materials are companies like Mycoworks, which raised $45 million last year from backers include John Legend, Natalie Portman along with more traditional investors like WTT Investment Ltd. (Taipei, Taiwan), DCVC Bio, Valor Equity Partners, Humboldt Fund, Gruss & Co., Novo Holdings, 8VC, SOSV, AgFunder, Wireframe Ventures and Tony Fadell.

With Natural Fiber Welding’s products Allbirds is boasting about a significantly reduced environmental footprint for its leather-like material. Natural Fiber Welding claims its material reduce the associated carbon footprint by 40 times and uses 17 times less carbon in its manufacturing than synthetic leather made from plastic.

The company does say that the plant leather will use natural rubber, an industry with its own history of human rights abuses, that’s also trying to clean up its act.

“For too long, fashion companies have relied on dirty synthetics and unsustainable leather, prioritizing speed and cost over the environment,” says Joey Zwillinger, co-founder and co-CEO of Allbirds, in a statement. “Natural Fiber Welding is creating scalable, sustainable antidotes to leather, and doing so with the potential for a game-changing 98% reduction in carbon emissions. Our partnership with NFW and planned introduction of Plant Leather based on their technology is an exciting step on our journey to eradicate petroleum from the fashion industry.”

TechCrunch has reached out to Allbirds for additional comment, but had not received a reply at the time of publication.

#adidas, #allbirds, #articles, #bolt-threads, #culture, #illinois, #john-legend, #leather, #manufacturing, #novo-holdings, #porsche, #shoe, #supply-chain, #sustainability, #taipei, #taiwan, #tc, #textiles, #tony-fadell, #valor-equity-partners, #welding

0

Calling Czech VCs: Be featured in The Great TechCrunch Survey of European VC

TechCrunch is embarking on a major project to survey the venture capital investors of Europe, and their cities.

Our survey of VCs in the Czech Republic and Prague will capture how the country is faring, and what changes are being wrought amongst investors by the coronavirus pandemic.

We’d like to know how the Prague, and the broader Czech, startup scene is evolving, how the tech sector is being impacted by COVID-19, and, generally, how your thinking will evolve from here.

Our survey will only be about investors, and only the contributions of VC investors will be included. More than one partner is welcome to fill out the survey. (Please note, if you have filled the survey out already, there is no need to do it again).

The shortlist of questions will require only brief responses, but the more you can add, the better.

You can fill out the survey here.

Obviously, investors who contribute will be featured in the final surveys, with links to their companies and profiles.

What kinds of things do we want to know? Questions include: Which trends are you most excited by? What startup do you wish someone would create? Where are the overlooked opportunities? What are you looking for in your next investment, in general? How is your local ecosystem going? And how has COVID-19 impacted your investment strategy?

This survey is part of a broader series of surveys we’re doing to help founders find the right investors.

https://techcrunch.com/extra-crunch/investor-surveys/

For example, here is the recent survey of London.

You are not in the Czech Republic, but would like to take part? That’s fine! Any European VC investor can STILL fill out the survey, as we probably will be putting a call out to your country next anyway! And we will use the data for future surveys on vertical topics.

The survey is covering almost every country on in the Union for the Mediterranean, so just look for your country and city on the survey and please participate (if you’re a venture capital investor).

Thank you for participating. If you have questions you can email mike@techcrunch.com

(Please note: Filling out the survey is not a guarantee of inclusion in the final published piece).

#europe, #tc

0

TreeCard raises $5.1M seed to plant trees as you spend

TreeCard, a U.K. yet-to-launch fintech offering a spending card made out of wood and the promise to fund reforesting via the interchange fees generated, has raised $5.1 million in seed funding. The round is led by EQT Ventures, with participation from Seedcamp and Episode 1.

Angel investors also backing the startup include Matt Robinson (founder of GoCardless), Paul Forester (founder of Indeed) and Charlie Delingpole (founder of ComplyAdvantage). TreeCard says the funding will be used to hire talent, support the roll-out of its product across the U.K. and to expand into the U.S. and “key European markets”.

Aiming to become a “leading green finance brand”, TreeCard was founded in August 2020 by Thiel fellow Jamie Cox (who previously co-founded Cashew), Gary Wu and James Dugan. The team hit onto the idea of swapping loyalty points or cash back for tree planting, in a bid to create a fintech proposition with more societal impact.

Once signed up, you link the TreeCard app to your current bank accounts so you can begin routing your spending through the Mastercard-powered TreeCard. Purchases you then make — or, specifically, a portion of the card transaction fees your spending generates — is then put toward tree planting projects run by green search engine Ecosia, which is also a pre-seed investor in TreeCard.

“[At a] high level, the climate crisis is the biggest existential risk that humanity has faced in the last 200,000 years; we believe directing the flow of consumer finances is the most powerful way to affect change,” CEO Cox tells me. “We’re building a finance company that allows consumers to not just to do less damage with their spending, but to actively improve the world.

“We are building a free spending card that allows consumers to spend more responsibly. The card uses interchange to reforest as they spend and sophisticated analytics to help them identify healthy spending as well as destructive ones”.

Of course, consumer card interchange fees in the U.K./EU are very low compared to the U.S. Offering a spending card and account isn’t without overhead, so it isn’t clear how sustainable TreeCard could be on interchange revenue alone. Perhaps unsurprisingly, the U.S., where generated fees are higher, is seen as a key launch market for the startup.

“Interchange fees in the U.S. are significantly higher than in the EU so this presents a sufficient revenue opportunity for us to perform our reforestation investments and cover marketing and management costs,” explains Cox. “In the EU we’re going to be partnering with an existing retail bank who will provide all our banking infrastructure for free. This will mean that, even though our interchange fee cut is lower, it will be sufficient to cover our costs in the EU. We will announce the name of the bank shortly”.

Meanwhile, early backer Ecosia is described by the TreeCard founder as its “mother” company. “They’re our closest partner and we’ll be working very closely with them as we grow,” Cox says. “They invested the first cheque into the company and will be doing all our tree planting for us. Ecosia’s marketing team is extremely experienced and they will be helping us use their search engine as a core channel for user acquisition over the next few years”.

Comments Tom Mendoza, deal partner at EQT Ventures: “TreeCard has the potential to become a leading green finance brand, going where no brand has gone before in creating a de facto platform for impactful financial management. At EQT Ventures, we’re increasingly aware of the environment and the impact that our investments have on the world around us, so we’re really excited to support the TreeCard team, who are actively working with the financial system to create a better future for the planet”.

#ecosia, #eqt-ventures, #europe, #fintech-startup, #fundings-exits, #recent-funding, #startups, #tc, #treecard

0

Rainmaking launches Motion Ventures to boost innovation in the maritime industry

A new fund has launched, with backing from the Singaporean government, to support tech innovation for the maritime industry. Called Motion Ventures, it is targeting $30 million SGD (about $22.8 million USD) and has completed its first close, with Wilhelmsen, one of the world’s largest maritime networks, and logistics company HHLA as anchor investors.

Motion Ventures was launched by Rainmaking, the venture building and investment firm that runs accelerator program Startupbootcamp, and will jointly invest in startups with SEEDS Capital, the investment arm of government agency Enterprise Singapore.

SEEDS Capital announced in June 2020 that it plans to invest $50 million SGD in maritime startups, with the goal of creating more resilient supply chains and fixing issues underscored by the COVID-19 pandemic.

Shaun Hon, general partner at Motion Ventures and director at Rainmaking, told TechCrunch that the fund plans to invest in around 20 early-stage startups focused on AI, machine learning and automation, with check sizes ranging between $500,000 SGD to $2 million SGD.

“We’ve got our eyes on some of the maritime value chain’s biggest challenges including decarbonization, supply chain resilience and improving safety. In most cases, the technology to address the industry’s issues already exists, but the missing link is figuring out how to apply these solutions in the corporate context,” Hon said.

“That’s what Motion Ventures aims to address,” he added. “If we can bring a consortium of industry adopters together to connect with entrepreneurs early in the process, we’re setting everyone up with the best chance to succeed.”

In addition to capital, Motion Ventures plans to partner startups with well-established maritime firms like Wilhelmsen to help them commercialize and integrate their technology into supply chains. For mentorship, Motion Ventures’ startups will also have access to Ocean Ventures Alliance, which was launched by Rainmaking in November 2020, and now includes more than 40 maritime value chain industry leaders.

#asia, #fundings-exits, #logistics, #maritime, #motion-ventures, #rainmaking, #seeds-capital, #singapore, #southeast-asia, #supply-chain, #tc

0

Stitch emerges from stealth with $4M for its API fintech play in Africa

Over the years, there has been a growing trend of fintech infrastructure players around the world. In Africa, a handful of startups have launched in the past three years to provide such services. Stitch, a South African fintech startup, is one of them and today, it is coming out of stealth and announcing its seed round of $4 million. This makes it the largest round raised by any API fintech startup in Africa at the moment.

Founded by Kiaan Pillay, Natalie Cuthbert, and Priyen Pillay, Stitch wants to provide full API access to financial accounts across Africa starting from its first market, South Africa. With its API, developers can connect apps to financial accounts. This allows users to share their transaction history and balances, confirm their identities, and initiate payments.

We’ve seen a wave of API-led financial services companies proliferating around the globe. Plaid leads the way in the U.S. Sweden-based fintech Tink has also been dominant across Europe, while Truelayer and Belvo are holding the forte in the UK and Latin America.

These companies provide engineering and developer tools that reduce the technical and operational effort needed for apps to connect to their users’ financial accounts. By way of APIs, they make it possible for other companies to integrate what are otherwise complex services to build from the ground up simply by adding in a few lines of code.

Like other financial infrastructure company, Stitch services allows companies and developers to innovate around other services like personal finance, lending, insurance, payments and wealth management.

The founders draw on prior experience building API products for local markets in the past. In 2017, Kiaan Pillay worked as the head of operations for South African insurance API platform Root. He left a year to Smile Identity, a San Fransisco-based identity API company. There, he worked with fintechs across Africa and discovered they faced infrastructural issues around compliance and identity.

The Stitch team

At the same time, Pillay, Cuthbert — who was the CTO at Root — and Priyen were looking to build a Venmo for Africa, but after eight months, they soon discovered the solution was crappy. However, one feature on the platform seemed to work for the fintechs with infrastructural issues

“We got to the point where we could build any payouts for our clients so users could link and cash out their bank accounts,” Pillay tells TechCrunch. “We decided to automate this process using screen scraping. I must admit, it didn’t look good but we took it in our stride because we thought it served its purpose and was super cool.”

This set the team up to work on Stitch — Pillay as CEO, Cuthbert as CTO and Priyen as CPO. After working on building better functionality and technology, Stitch beta launched in September 2019 and secured a pre-seed round a month later. While in stealth, Stitch says it has gotten a handful of clients, which include Intelligent Debt Management, Momentum Velocity Club, Paystack, Flexclub, and two of South Africa’s biggest insurance players. The company is also beginning to attract some attention from corporate companies around consumer-facing products.

As of now, Stitch has a data and identity API product, and this month, a payment product will be added to its offerings. Like most API fintech startups, Stitch charges developers and companies per API call. However, for some products like budgeting or personal finance management apps, it also charges a fixed fee.

With wide and deep investor backing, Stitch will use the funding to consolidate growth in South Africa. There are plans to also launch operations in West and East Africa; the company’s statement reads.

Africa’s financial infrastructure space is heating up

These markets already have players, mainly Nigerian startups, in the API fintech space. They have raised sizeable rounds with enviable backings as well. Mono, a startup that only launched six months ago, is backed by YC; For Okra, it is Pan-African VC firm TLcom Capital; OnePipe has Techstars, and US-based but Africa-focused Pngme has attracted investment from Pan African VC firms EchoVC and Lateral Capital.

For now, these startups don’t operate in more than two countries. For instance, Mono, Okra and OnePipe are only live in Nigeria. Pngme says it’s operating in Nigeria and Kenya, while Stitch is only in South Africa. It will be interesting to see how competition and collaboration play out when they expand outside their markets. We might not wait long as Okra is currently in beta in Kenya and South Africa, and Mono is planning an expansion into Ghana and Kenya before the end of the year.

This doesn’t bother Pillay and his team at Stitch, though. He, alongside founders of these startups who I’ve talked to in the past year, believe competition is healthy for the market, and more founders should actually build similar companies. That said, Pillay adds that what might play out is each company creating a niche functionality at which they’re best.

“Unlike the U.S. where Plaid is dominant, I think the African market needs many players because the market is large. Europe is a good example; many sizeable companies are providing similar banking API services. For us, I think what we would start to see happen is that some companies will be known to do a particular functionality well like payments, data enrichment, or merchant identification.”

Image Credits: Stitch

Stitch has an impressive lineup of investors for this seed round led by London-based VC firm, firstminute Capital and SA-based investment firm, The Raba Partnership. Other investors who took part include both funds and angels.

The funds include CRE and Village Global, Norrsken (a fund by Klarna co-founder Niklas Adalberth), Future Africa (a fund by Flutterwave co-founder Iyinoluwa Aboyeji) and 500 Fintech. The angel cohort includes Venmo co-founder Iqram Magdon Ismail, some founding members at Plaid, executives at Coinbase, Revolut, Fast, and Paystack.

On how the startup still in stealth managed to get these investors on board, Pillay says it’s down to the company’s network in the US and the belief each investor have in the product.

“Spending a lot of time in San Francisco when working with Smile has helped us to get in touch with these globally world-class founders and investors. There’s an opportunity for us to provide a new generation of financial services in markets across Africa, and we’re really fortunate to have them back us.” 

For Brent Hoberman, co-founder and executive chairman of firstminute capital, the firm decided to back Stitch because it believes most online business in Africa will embed fintech capabilities in their applications — facilitating online payments, increasing lending capacity and streamlining KYC and identity checks — through Stitch.

“As a fellow South African, I’m excited to be partnering with a team of exceptionally talented local engineers with pan-African ambitions,” he added.

That said, Africa’s fintech sector is beginning to heat up after a slow January which saw agritech and cleantech sectors dominate funding rounds. This week, South African digital bank TymeBank raised a whopping $109 million to expand across the country and into Asia, extending the sort of large rounds we’ve seen in the past from a sector that attracted more than 30% of VC funding.

For Stitch, its seed round is the latest in a series of notable deals in the African API fintech space over the last two years, where other major players have raised between $500,000 to $5 million.

#africa, #financial-services, #funding, #recent-funding, #startups, #stitch, #tc

0

Plant-based food startup Next Gen lands $10M seed round from investors including Temasek

Singapore is quickly turning into a hub for food-tech startups, partly because of government initiatives supporting the development of meat alternatives. One of the newest entrants is Next Gen, which will launch its plant-based “chicken” brand, called TiNDLE, in Singaporean restaurants next month. The company announced today that it has raised $10 million in seed funding from investors including Temasek, K3 Ventures, EDB New Ventures (an investment arm of the Singapore Economic Development Board), NX-Food, FEBE Ventures and Blue Horizon.

Next Gen claims this is the largest seed round ever raised by a plant-based food tech company, based on data from PitchBook. This is the first time the startup has taken external investment, and the funding exceeded its original target of $7 million. Next Gen was launched last October by Timo Recker and Andre Menezes, with $2.2 million of founder capital.

Next Gen’s first product is called TiNDLE Thy, an alternative to chicken thighs. Its ingredients include water, soy, wheat, oat fiber, coconut oil and methylcellulose, a culinary binder, but the key to its chicken-like flavor is a proprietary blend of plant-based fats, like sunflower oil, and natural flavors that allows it to cook like chicken meat.

Menezes, Next Gen’s chief operating officer, told TechCrunch that the company’s goal is to be the global leader in plant-based chicken, the way Impossible and Beyond are known for their burgers.

“Consumers and chefs want texture in chicken, the taste and aroma, and that is largely related to chicken fat, which is why we started with thighs instead of breasts,” said Menezes. “We created a chicken fat made from a blend, called Lipi, to emulate the smell, aroma and browning when you cook.”

Both Recker and Menezes have years of experience in the food industry. Recker founded German-based LikeMeat, a plant-based meat producer acquired by the LIVEKINDLY Collective last year. Menezes’ food career started in Brazil at one of the world’s largest poultry exporters. He began working with plant-based meat after serving as general manager of Country Foods, a Singaporean importer and distributor that focuses on innovative, sustainable products.

“It was clear to me after I was inside the meat industry for so long that it was not going to be a sustainable business in the long run,” Menezes said.

Over the past few years, more consumers have started to feel the same way, and began looking for alternatives to animal products. UBS expects the global plant-based protein market to increase at a compounded annual growth rate of more than 30%, reaching about $50 billion by 2025, as more people, even those who aren’t vegans or vegetarians, seek healthier, humane sources of protein.

Millennial and Gen Z consumers, in particular, are willing to reduce their consumption of meat, eggs and dairy products as they become more aware of the environmental impact of industrial livestock production, said Menezes. “They understand the sustainability angle of it, and the health aspect, like the cholesterol or nutritional values, depending on what product you are talking about.”

Low in sodium and saturated fat, TiNDLE Thy has received the Healthier Choice Symbol, which is administered by Singapore’s Health Promotion Board. Next Gen’s new funding will be used to launch TiNDLE Thy, starting in popular Singaporean restaurants like Three Buns Quayside, the Prive Group, 28 HongKong Street, Bayswater Kitchen and The Goodburger.

Over the next year or two, Next Gen plans to raise its Series A round, launch more brands and products, and expand in its target markets: the United States (where it is currently recruiting a growth director to build a distribution network), China, Brazil and Europe. After working with restaurant partners, Next Gen also plans to make its products available to home cooks.

“The reason we started with chefs is because they are very hard to crack, and if chefs are happy with the product, then we’re very sure customers will be, too,” said Menezes.

#asia, #food, #foodtech, #fundings-exits, #next-gen, #plant-based-food, #plant-based-meat, #recent-funding, #singapore, #southeast-asia, #startups, #tc, #temasek, #tindle

0

Paramount+ will cost $4.99 per month with ads

ViacomCBS executives held a virtual investor event today where they outlined the strategy for Paramount+, the streaming service set to launch on March 4 that’s basically a rebranded, expanded version of CBS All Access.

In addition to launching in the United States, executives said the service will be available across Latin America and Canada on March 4, with a Nordic launch a few weeks later and an Australian launch also planned for this year.

And they said that Paramount+ will cost $4.99 per month with ads in the U.S. (less than the $5.99 charged for CBS All Access), or $9.99 without ads and with additional sports, news and live TV content. There are also plans to bundle this with the company’s premium subscriptions, such as Showtime.

Yes, it’s yet another streaming service with a plus in its name. But the company’s streaming president and CEO Tom Ryan said research has shown that ViacomCBS brands — not just Paramount and CBS, but Comedy Central, MTV, Nickelodeon and more — are well-known to viewers, and they’ll all be front-and-center in the new service. Plus, it’s worth noting that ViacomCBS already produces a number of hit streaming shows on other services, such as “13 Reasons Why,” “Emily in Paris” and “Jack Ryan.”

ViacomCBS executives also argued that Paramount+ will have a unique combination of live news, live sports and (to use a phrase repeated throughout the event) “a mountain of entertainment.” And from a product perspective, the service will offer originals in 4K, HDR and Dolby Vision, with easy downloads.

On the entertainment side, the service is supposed to have more than 30,000 TV show episodes and 2,500 movies. And the library will expand with new shows like a new version of “Frasier” with Kelsey Grammer returning to the role, as well as a “Halo” TV show that will now debut on Paramount+ instead of Showtime in early 2022. The service is also rebooting a variety of Paramount properties like “Love Story,” “Fatal Attraction” and “Flashdance.”

And like CBS All Access before it, Paramount+ will be home to new Star Trek shows — not just the already launched “Discovery,” “Picard” and “Lower Decks,” but also the upcoming “Strange New Worlds” and the kids animated series “Prodigy.”

On the movie side, Paramount CEO Jim Gianopulos said the company is still a big believer in the theatrical model, but it will be bringing some 2021 releases — including “A Quiet Place Part 2,” the first “Paw Patrol” movie and “Mission Impossible 7” — to Paramount+ in an accelerated fashion, 30 to 45 days after they come to theaters (a much less aggressive strategy than HBO Max, which will stream all Warner Bros. movies this year simultaneously with their theatrical release). And there will be new straight-to-streaming movies as well, starting with reboots of “Paranormal Activity” and “Pet Sematary.”

#media, #paramount-plus, #streaming-service, #tc, #viacomcbs

0

Spain’s Wallapop raises $191M at an $840M valuation for its classifieds marketplace

Through all of the last year’s lockdowns, venue closures, and other social distancing measures that governments have enacted and people have followed to slow the spread of Covid-19, shopping — and specifically e-commerce — has remained a consistent and hugely important service. It’s not just something that we had to do; it’s been an important lifeline for many of us at a time when so little else has felt normal. Today, one of the startups that saw a big lift in its service as a result of that trend is announcing a major fundraise to fuel its growth.

Wallapop, a virtual marketplace based out of Barcelona, Spain that lets people resell their used items, or sell items like crafts that they make themselves, has raised €157 million ($191 million at current rates), money that it will use to continue growing the infrastructure that underpins its service, so that it can expand the number of people that use it.

Wallapop has confirmed that the funding is coming at a valuation of €690 million ($840 million) — a significant jump on the $570 million valuations sources close to the company gave us in 2016.

The funding is being led by Korelya Capital, a French VC fund backed by Korea’s Naver, with Accel, Insight Partners, 14W, GP Bullhound and Northzone — all previous backers of Wallapop — also participating.

The company currently has 15 million users — about half of Spain’s internet population, CEO Rob Cassedy pointed out to us in an interview earlier today, and has maintained a decent number-four ranking among Spain’s shopping apps, according to figures from App Annie.

The startup has also recently been building out shipping services, called Envios, to help people get the items they are selling to the buyers, which has expanded the range from local sales to those that can be made across the country. About 20% of goods go through Envios now, Cassedy said, and the plan is to continue doubling down on that and related services.

Naver itself is a strong player in e-commerce and apps — it’s the company behind Asian messaging giant Line, among other digital properties — and so this is in part a strategic investment. Wallapop will be leaning on Naver and its technology in its own R&D, and on Naver’s side it will give the company a foothold in the European market at a time when it has been sharpening its strategy in e-commerce.

The funding is an interesting turn for a company that has seen some notable fits and starts. Founded in 2013 in Spain, it quickly shot to the top of the charts in a market that has traditionally been slow to embrace e-commerce over more traditional brick-and-mortar retail.

By 2016, Wallapop was merging with a rival, LetGo, as part of a bigger strategy to crack the U.S. market (with more capital in tow).

But by 2018, that plan was quietly shelved, with Wallapop quietly selling its stake in the LetGo venture for $189 million. (LetGo raised $500 million more on its own around that time, but its fate was not to remain independent: it was eventually acquired by yet another competitor in the virtual classifieds space, OfferUp, in 2020, for an undisclosed sum.)

Wallapop has for the last two years focused mainly on growing in Spain rather than running after business further afield, and rather than growing the range of goods that it might sell on its platform — it doesn’t sell food, nor work with retailers in an Amazon-style marketplace play, nor does it have plans to do anything like move into video or selling other kinds of digital services — it has honed in specifically on trying to improve the experience that it does offer to users.

“I spent 12 years at eBay and saw that transition it made to new goods from used goods,” said Cassedy. “Let’s just say it wasn’t the direction I thought we should take for Wallapop. We are laser focused on unique goods, with the vast majority of that second hand with some artisan products. It is very different from big box.”

Wallapop’s growth in the past year isare the result of some specific trends in the market that were in part fuelled by the Covid-19 pandemic.

People spending more time in their homes have been focused on clearing out space and getting rid of things. Others are keen to buy new items now that they are spending more time at home, but want to spend less on them. In both cases, there has been a push for more sustainability, with people putting less waste into the world by recycling and upcycling goods instead.

At the same time, Facebook hasn’t really made big inroads with its Marketplace in the country, and Amazon has also not appeared as a threat to Wallapop, Cassedy noted.

All of these have had a huge impact on Wallapop’s business, but it wasn’t always this way. Cassedy said that the first lockdown in Spain saw business plummet, as people were restricted to leave their homes.

“It was a rollercoaster for us,” he said. “We entered the year with incredible momentum, very strong.”

He noted that the drop started in March, when “not only did it become not okay to leave house and trade locally but the post office stopped delivering parcels. Our business went off a cliff in March and April.”

Then when the restrictions were lifted in May, things started to bounce back than ever before, nearly overnight, he said. “The economic uncertainty caused people to seek out more value, better deals, spending less money, and yes they were clearing out closets. We saw numbers bounce back 40-50% growth year-on-year in June.”

The big question was whether that growth was a blip or there to say. He said it has continued into 2021 so far. “It’s a validation of what we see as long term trends driving the business.”

“The global demand for C2C and resale platforms is growing with renewed commitment in sustainable consumption, especially by younger millennials and Gen Z,” noted Seong-sook HAN, CEO of NAVER Corp., in a statement. “We agree with Wallapop’s philosophy of conscious consumption and are enthused to support their growth with our technology and develop international synergies.”

“Our economies are switching towards a more sustainable development model; after investing in Vestiaire Collective last year, wallapop is Korelya’s second investment in the circular economy, while COVID-19 is only strengthening that trend. It is Korelya’s mission to back tomorrow’s European tech champions and we believe that NAVER has a proven tech and product edge that will help the company reinforce its leading position in Europe,” added Fleur Pellerin, CEO of Korelya Capital.

#korelya-capital, #recent-funding, #startups, #tc, #wallapop

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Pilot CEO Waseem Daher tears down his company’s $60M Series C pitch deck

The pitch deck is just one aspect of the broader fundraising process, but for founders aiming to entice investors, it’s the best way to communicate their startup’s progress and potential.

The decisions founders make regarding what to include on those few slides can be the difference between a quick pass or a first check. As the venture capital market continues to boil over and investors find themselves reviewing more deals remotely across different stages, there’s added need to drill down into the basics for their first look inside the company.

To get an insider’s look into the process, I chatted with Pilot CEO Waseem Daher. Last month, his bookkeeping and financial tools startup wrapped a $60 million Series C round led by Sequoia, bringing the company’s total funding to just north of $118 million. We discussed the different approaches he has taken to crafting the company’s pitch deck to showcase what he knew potential investors were most curious in, something that shifted over time as the company hit new milestones.

Daher took me on a tour of his company’s Series C pitch deck (embedded below) and described the decisions he and his team spent the most time considering as they crafted the deck. During the discussion, he broke down some of the key questions investors ask at each stage and touched on many of the proof points that VCs have started paying more attention to.

“If the Series A was about, ‘Do you have the right ingredients to make this work?’ then the Series B is about, ‘Is this actually working?'”

“If the Series A was about, ‘Do you have the right ingredients to make this work?’ then the Series B is about, ‘Is this actually working?’” Daher tells TechCrunch. “And then the Series C is more, ‘Well, show me that the core business is really working and that you have unlocked real drivers to allow the business to continue growing.’”

What are investors looking for?

Seed

  • Key investor question: Is there significant potential?
  • Proof points to consider: Total addressable market (TAM), team.

Series A

  • Key investor question: Is there proof of product-market fit?
  • Additional proof points to consider: Annual recurring revenues (ARR), cash burn.

Series B

  • Key investor question: Is the flywheel working? Will you be the market winner?
  • Additional proof points to consider: ARR growth, net retention, market share.

Series C/D

  • Key investor question: Are the unit economics compelling?
  • Additional proof points to consider: Gross margin, lifetime value (LTV), Customer acquisition costs (CAC).

IPO

  • Key investor question: Will the business generate significant cash flow?
  • Additional proof points to consider: Free cash flow (FCF), FCF margin, average selling price (ASP) growth, category expansion, earnings per share (EPS).

Check out the full pitch deck below from Pilot’s most recent raise (with illustrative data swapped for actual financial metrics).

#corporate-finance, #ec-how-to, #entrepreneurship, #tc, #venture-capital

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Handy co-founder Oisin Hanrahan is taking over as CEO of ANGI Homeservices

A little over two years after ANGI Homeservices acquired his startup Handy, Oisin Hanrahan is becoming CEO of the combined organization and joining its board of directors.

ANGI is a publicly traded subsidiary of IAC, formed from the merger of Angie’s List and HomeAdvisor. In addition to the Angie’s List, HomeAdvisor and Handy brands, the company also operates Fixd Repair, HomeStars, MyHammer, MyBuilder, Instapro, Travaux and Werkspot (most of those are outside the United States).

The company says that nearly 250,000 home service professionals are active across its platforms in a given year, with more than 30 million projects facilitated annually. For the fourth quarter of 2020, it reported revenue of $359 million (up 12% year over year) and a net loss of $14.5 million.

Hanrahan joined the company with the acquisition of Handy in October 2018, becoming ANGI’s chief product officer the next year.

“I’m really excited for the opportunity to lead ANGI at this inflection point,” Hanrahan said in a statement. “As we’ve all spent extra time at home over the last year it’s clearer than ever how important our physical space is in our daily lives, and ANGI’s mission to help people love where they live is more relevant than ever. I’m grateful to the board and energized to work with our talented team to help ANGI become the home for everything home.”

ANGI’s previous CEO, Brandon Ridenour, is stepping down from the role. In the announcement, IAC CEO Joey Levin thanked Ridenour “for his instrumental role in building ANGI Homeservices over the last decade” while praising Hanrahan as “an exceptional product visionary.”

In addition, the company announced appointments to two new positions, with Bryan Ellis, becoming chief revenue officer — Marketplace (he’ll oversee the company’s leads and advertising products) and Handy co-founder Umang Dua becoming chief revenue officer — ANGI Services (where he’ll be in charge of ANGI’s pre-priced product).

 

#angi-homeservices, #handy, #oisin-hanrahan, #tc

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