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Twitter-backed Indian social network ShareChat raises $40 million

2020, September 24 - 9:12pm

ShareChat, an Indian social network that focuses entirely on serving users in non-English languages, said on Thursday it has raised $40 million from a clutch of investors after the Indian startup added tens of millions of new users in recent months.

The five-year-old Bangalore-based startup said Dr. Pawan Munjal, chief executive and chairman of giant two-wheeler manufacturer Hero MotoCorp, Ajay Shridhar Shriram, chairman of chemical manufacturing company DCM Shriram, and existing investors Twitter, SAIF Partners, Lightspeed Ventures and India Quotient financed the new round of capital.

Ankush Sachdeva, co-founder and chief executive of ShareChat, told TechCrunch in an interview that the startup’s new fundraise is part of its pre-Series E financing round. TechCrunch understands the startup is engaging with several major VC funds and corporate giants to raise more than $100 million in the next few months. ShareChat has raised about $264 million to date.

The new capital will help ShareChat better support creators on its platform, Sachdeva said. ShareChat launched the short-video app Moj in early July, days after New Delhi banned TikTok, which at the time had about 200 million users in India.

In the weeks following TikTok’s ban in India, scores of startups have launched short-video apps in the country. DailyHunt has launched Josh, and Times Internet’s MX Player has launched TakaTak. But Moj has clearly established dominance1 among short-form video apps.

ShareChat said Moj has amassed more than 80 million monthly active users, who are spending about 34 minutes on the platform each day.

ShareChat’s marquee and eponymous app, which caters to users in 15 Indian languages, itself has grown “exponentially.” The app has amassed 160 million monthly active users 2, up from 60 million during the same period last year. A user on an average spends about 31 minutes on the app each day, the startup said.

“ShareChat has grown phenomenally this calendar year,” said Sachdeva. The growth of ShareChat in the social media category is a rare success story for the Indian startup ecosystem.

“India could never have dreamt of having a homegrown social media platform, had ShareChat not embarked on the impossible in 2015. ShareChat’s success has given immense hope to India’s startup fraternity, and motivated entrepreneurs to take audacious bets in India’s internet ecosystem,” said Madhukar Sinha, partner at India Quotient, one of the earliest backers of ShareChat.

In yet another move that is not very common among Indian startups, ShareChat announced earlier this week that it was adding $14 million to its employee stock ownership plan (ESOP), taking the total to $35 million.

Sachdeva said that for a startup of ShareChat’s scale, it is crucial that its employees feel valued, because there are enough other giants in the market looking for similar talent. “Our biggest competitors are global peers from the U.S. and Beijing,” he said.

The new capital will also help the startup further invest in its AI prowess and build new products and establish deeper partnerships with music labels, Sachdeva said. TechCrunch reported earlier this year that ShareChat had quietly launched a fantasy sports app called Jeet11.

Sachdeva said Jeet11 is gaining good traction and the startup’s foray into fantasy sports and short-video app categories demonstrates how fast it moves.

ShareChat has also been working with advertisers as it solidifies its monetization avenues, he said. “The brands are loving the fact that they can engage very strongly with users,” he said.

The startup is also thinking about expanding outside of India, though such plans are in an early stage, he said. A fraction of ShareChat’s users today already live outside of India. The app has attracted many users of Indian diaspora, he said.

“To our amazement, the first version of Sharechat app was created in just a few days of beanbags and Red Bull in our office. And five years later they have done the same with Moj. As a new era unfolds with Moj, we are yet again solidly behind this team to support them. We believe Moj is designed for bigger success and will succeed across India, and beyond India in the years to come,” said India Quotient’s Sinha.

1 Instagram reaches about 150 million monthly active users in India, but it’s unclear if more than half of the app’s userbase has embraced Reels yet.

2  Many players in the industry rely on mobile insight firm AppAnnie and Sensor Tower to track the performance of their apps, their portfolio startups’ apps, and those of their competitors. We often cite AppAnnie and Sensor Tower data, too.

According to AppAnnie, ShareChat had fewer than 20 million monthly active users in India last month. Startup founders and other tech executives with whom TechCrunch has spoken say that AppAnnie’s data is usually very reliable, and I can tell you that most of the figures companies claim publicly match what you see on AppAnnie’s dashboard.

But another thing I have heard from many startup founders is that AppAnnie’s data often misses the mark for apps that have a significant portion of their user base in smaller cities and towns — as is the case with ShareChat.

I asked Sachdeva about it, and he said that ShareChat and many other apps that are popular in smaller Indian cities have not integrated AppAnnie’s SDK into their apps. AppAnnie relies on developers integrating its SDK into their apps to be able to assess the performance of that app and others installed on the handset.

This would explain why AppAnnie estimates that WhatsApp, which claims to have over 400 million users in India and is also popular among users in smaller Indian cities and towns and villages, has about 330 million users.

The contrast between the numbers ShareChat has officially shared and what one of the most reliable and widely used third-party firms offers was too significant, and I thought I should mention this. (An industry executive shared AppAnnie’s figures with TechCrunch.)

Categories: Business News

Ohio-based collaboration service for biotech and pharma research, Within3, raises $100 million

2020, September 24 - 9:07pm

Within3, a collaboration and communication service for the biotech and pharma industries, has raised over $100 million in new financing, the company said.

The investment came from Insight Partners with participation from Silversmith Capital Partners.

Most of the top 20 pharmaceutical companies already use the Lakewood, Ohio-based company’s service to publish clinical studies, host advisory boards and collaborate with researchers and other participants in the drug development process, according to a statement from the company.

Within3 said it would use the new funding to continue its product development and build additional capacity to support its growth.

“Investment opportunities in companies like Within3 don’t come around very often,” said Deven Parekh, managing director at Insight Partners, in a statement. “The company has seen explosive growth over the last 12 quarters and continues to break new records each month… At a time when collaboration, communication and cooperation is more critical than ever across the global life sciences ecosystem, we are excited to bring our strategic operations expertise to help Within3 scale.”

Parekh, and Insight Partners’ managing directors Adam Berger and Ross Devor, will join Within3’s board as a result of the financing.

The COVID-19 pandemic has pushed an increasing number of companies in a variety of industries to pursue virtual collaboration tools, and the pharmaceutical and biotech business is no different.

Indeed, given the regulatory requirements, it makes sense that a bespoke toolkit designed around the industry’s more robust needs would raise a heaping amount of cash.

Within3 boasts of users in more than 150 countries.

“Global demand for our solution is surging at an unprecedented rate,” said Lance Hill, CEO of Within3, in a statement. “Life science companies are looking for virtual work solutions that exceed the level of engagement of traditional live interactions, meets all their compliance needs, and that will scale across the enterprise. They have found that solution with Within3.”

Categories: Business News

Snyk acquires DeepCode to boost its code review smarts

2020, September 24 - 8:12pm

Switzerland-based machine learning code review startup DeepCode — which bills itself as “Grammarly for coders” — has been acquired by Snyk, a post-unicorn valuation cybersecurity startup focused on helping developers secure their code.

Financial terms of the deal have not been disclosed. But the “big code” parsing startup had only raised around $5.2 million since being founded back in 2016, per Crunchbase — mostly recently closing a $4 million seed round from investors including Earlybird, 3VC and btov Partners last year.

DeepCode CEO and co-founder Boris Paskalev confirmed the whole team is “eagerly” joining Snyk to continue what he couched as “the mission of making semantic AI-driven code analysis available for every developer on the planet.”

“DeepCode as a company will continue to exist (fully owned by Snyk), we will keep and plan to grow the Zurich office and tap into the amazing talent pool here and we will continue supporting and expanding the cutting-edge product offering for the global development community,” Paskalev told TechCrunch.

Asked whether DeepCode’s product will continue to exist as a standalone in the future or whether full assimilation into Snyk’s platform will include closing down the code-review bot it currently offers developers, he said no decision has yet been taken.

“We are still to evaluate that in details but the main goal is to maintain/expand the benefits that we offer to all developers and specifically to grow the open-source adoption and engagement,” he said, adding: “Initially clearly nothing will change and the DeepCode product will remain as a standalone product.”

“Both companies have a very clear vision and passion for developer-first and helping developers and security teams to further reduce risk and become more productive,” Paskalev added.

In a statement announcing the acquisition, Snyk said it will be integrating DeepCode’s technology into its Cloud Native Application Security platform — going on to tout the benefits of bolting on its AI engine, which it said would enable developers to “more quickly identify vulnerabilities.”

“DeepCode’s AI engine will help Snyk both increase speed and ensure a new level of accuracy in finding and fixing vulnerabilities, while constantly learning from the Snyk vulnerability database to become smarter,” wrote CEO Peter McKay. “It will enable an even faster integration for developers, testing for issues while they develop rather than as an additional step. And it will further increase the accuracy of our results, almost eliminating the need to waste time chasing down false positives.”

Among the features that have impressed Snyk about DeepCode, McKay lauded code scanning that’s “10-50x faster than alternatives”; and what he described as an “exceptional developer UX” — which allows for “high-precision semantic code analysis in real time” because scanning is carried out at the IDE and git level.

In its own blog post about the acquisition of the ETH Zurich spin-off, the university writes that the AI startup’s “decisive advantage” is that “it has developed the first AI system that can learn from billions of program codes quickly, enabling AI-​based detection of security and reliability code issues.”

“DeepCode is an excellent example of a modern AI system that can learn from data, program codes in this case, yet remain transparent and interpretable for humans,” it adds.

The university research work underpinning DeepCode dates back to 2013 — when its co-founders were figuring out how to combine data-​driven machine learning methods with semantic static code analysis methods based on symbolic reasoning, per the blog post.

DeepCode’s tech currently reaches more than 4 million contributing developers, with more than 100,000 repositories subscribed to its service.

Categories: Business News

Ripjar, founded by GCHQ alums, raises $36.8M for AI that detects financial crime

2020, September 24 - 5:34pm

Financial crime as a wider category of cybercrime continues to be one of the most potent of online threats, covering nefarious activities as diverse as fraud, money laundering and funding terrorism. Today, one of the startups that has been building data intelligence solutions to help combat that is announcing a fundraise to continue fueling its growth.

Ripjar, a U.K. company founded by five data scientists who previously worked together in British intelligence at the Government Communications Headquarters (GCHQ, the U.K.’s equivalent of the NSA), has raised $36.8 million (£28 million) in a Series B, money that it plans to use to continue expanding the scope of its AI platform — which it calls Labyrinth — and scaling the business.

Labyrinth, as Ripjar describes it, works with both structured and unstructured data, using natural language processing and an API-based platform that lets organizations incorporate any data source they would like to analyse and monitor for activity. It automatically and in real time checks these against other data sources like sanctions lists, politically exposed persons (PEPs) lists and transaction alerts.

Sources close to the company say that the funding values the startup in the region of £100 million, or about $127 million. Ripjar is currently profitable, the company confirmed.

The funding is being led by Long Ridge Equity Partners, a specialist fintech investor, with previous investors Winton Capital Ltd. and Accenture plc also participating. Accenture is a strategic partner: the consultancy/systems integrator uses Ripjar’s tech to work with a number of clients in the financial services sector. Ripjar also has government clients, where its platform is used for counterterrorism work. It declined to disclose any specific names, but it does note that its extensive partner list also includes the likes of PWC, BAE Systems, Dow Jones and more.

“We are excited to partner with Long Ridge who bring expertise and resources in scaling fast-growing software companies,” said Jeremy Annis, who is both the CEO and CTO of Ripjar and co-founded the company with Tom Griffin, Leigh Jones, Robert Biggs and Jeremy Laycock. “This investment signals enormous confidence in our world-leading data intelligence technology and ability to protect companies and governments from criminal behaviour which threatens their assets and prosperity. With this funding, we will accelerate the expansion of Ripjar worldwide to provide our customers with the most advanced financial crime solutions, as well as creating new iterations of the Labyrinth platform.”

The startup says that it’s had its biggest year yet — no surprise, given the circumstances. Not only has there been huge shift to online transactions in 2020 because of the rise of the COVID-19 global health pandemic, but a tightening of the world economy has led to more financial scrambling and new nefarious activity, as well as criminal acts to profit from the instability.

That’s led to inking deals with six new enterprise customers and expanding deals with four existing major clients, and Ripjar said that it now has some 20,000 clients globally.

And if you are curious about the name, as I was, it’s if anything a meta reference to some of the kind of work that Ripjar does.

“It doesn’t mean anything,” a spokesperson said. “It was created using technology to ensure a name was selected that had never been used before.”

London, as one of the world’s financial centers, has developed a strong reputation for hatching and growing interesting fintech startups, and that has also meant the U.K. — which also has a strong talent base in artificial intelligence — has become very fertile ground for startups building services to help protect those fintechs.

Ripjar’s raise, and rise, come within months of two other companies building AI to combat fraud and financial crime also raising money and growing. In July, ComplyAdvantage, which has also been building a database and platform to help combat financial crime, announced a $50 million raise. And a week before that, another U.K. company also building AI for financial and other cybercrime detection, Quantexa, raised $64.7 million.

Ripjar counts both of these, as well as bigger targets like Palantir, among its competitors. As is most likely, the big institutions that are grappling with financial crime are most likely using several companies’ technology at the same time.

It claims to have the more sophisticated approach. “We believe that Labyrinth is the most advanced solution in the market as we’ve developed it after decades of firsthand experience of fighting crime and terrorism within the national security community,” said David Balson, director of Intelligence at Ripjar, in answer to my question about competitors. “There is no silver bullet in the fight against crime. As such, we’ve had to come up with hundreds of innovations to increase the efficiency and effectiveness of the vital work that goes on in the financial sector and law enforcement. This includes our world-leading natural language processing (NLP) and identity resolution capabilities, which work over any global language and script, joining the dots automatically between structured data and unstructured text like documents, news reports, web pages and intelligence reports. It’s a vital tool to help analysts overcome the information overload that is so often associated with the sector.”

Indeed, the silver bullet reference applies to more than just Ripjar’s technology. With the issue of money laundering alone a $2 trillion problem (with only 1-2% of that ever identified and recovered), you can see why, at least for right now, banks, governments and others might be willing to put multiple resources on the problem to try to tackle it.

“Financial institutions, corporates and government agencies face ever-increasing risks associated with financial crime and cyber threats” said Kevin Bhatt, a managing partner at Long Ridge, in a statement. “We believe Ripjar is well-positioned to provide artificial intelligence solutions that will allow its clients to reduce the cost of compliance, while uncovering new threats through automation. We are incredibly excited to partner with Ripjar to support their continued growth and look forward to working closely with the Ripjar team as they expand to new geographies, customers, and verticals.”

Categories: Business News

Small business challenger bank Finom raises another $12 million to expand in Europe

2020, September 24 - 4:56pm

B2B financial service startup Finom — which provides online financial services for SMEs, freelancers and the self-employed in Europe — has raised an additional $12 million (€10.3 million) to add to its previous seed round of €6.5 million last April. The total funding raised in 2020 is now €16.8 million, and this is before the company has done a Series A round. Investors include Target Global (Germany), Cogito Capital (Poland), Entree Capital (Israel), Avala Capital (Germany), Tal Capital (India) and Adfirst Ventures FJ Labs (USA).

The additional investment round will allow Finom to extend its licensed activities, develop product and enter new European markets.

Founded in 2019, Finom is based out of the Netherlands and was founded by the team previously responsible to Modulbank, a B2B online bank in Russia. So far it is providing an e-invoicing service in Italy, and will launch in France this October.

Similar to other online challenger banks aimed at SMEs, the company is targeting countries where there is a relatively low penetration of online SME banking players, such as as Poland, Spain, Austria, Switzerland.

Categories: Business News

Peterson Ventures, a firm that quietly backed Allbirds and Bonobos, just closed a $65 million fund

2020, September 24 - 7:49am

Peterson Ventures, a 12-year-old, Salt Lake City, Utah-based seed-stage fund, has long operated fairly quietly, but many of its bets have become known brands in the respective worlds of consumer and enterprise software investing. Among these is the shoe company Allbirds; the men’s clothing company Bonobos (acquired a few years ago by Walmart); and Lucid Software, which closed its newest, $52 million round back in April.

Thanks to a newly raised $65 million fund — more than double the size of its $33 million second fund — Peterson has even more money now to write checks in the range of $250,000 to $1 million in a wide variety of startups.

We were in touch this week with Peterson partner Ilana Stern, whose own consumer startup, Weddington Way,  raised money from Peterson before selling to the Gap in 2016. Stern, who joined the outfit last fall and is based in San Francisco, shared a bit more about the firm’s newest fund and where it’s looking to shop. Our exchange has been edited lightly for length.

TC: Peterson is part of a bigger platform called Peterson Partners. How many asset classes is Peterson Partners funding?

IS: Peterson Ventures is part of the Peterson Partners platform with funds that invest in lower-middle-market private equity and search funds. There are over 30 people firm-wide, including a four-person full-time investing team [on the venture side]. We’ll be looking to add one to two more members in the next year.

TC: How does the firm think about consumer versus SaaS, and is this different than in past years? For example, First Round Capital used to invest half its capital in consumer-facing startups, and that’s not the case right now, as Josh Kopelman told us a couple of weeks ago.

IS: Our first, $25 million fund, was close to a 50/50 split; in the second fund, we shifted to 65%/35%, focusing more heavily on B2B SaaS than consumer. Going forward, we expect to be investing around 60% to 70% SaaS and around 30% to 40% consumer.

The bread and butter of the Utah market is SaaS, and we expect to continue to back great SaaS companies in Utah. That said, there is a growing ecosystem of compelling e-commerce and consumer companies, including in healthcare and financial services where we see a continued ‘consumerization’ of those two sectors.

TC: What are two of the firm’s most recent bets, and what do they say about the way your team operates?

IS: Via and Tava Health are two of our new seed investments. Via connects businesses to their consumers on their favorite messaging and voice platforms. Commerce infrastructure is an area where we’ve been very active over the last five or so years, [including because it’s a] perfect cross section of SaaS companies selling into e-commerce and retail. Tava Health is a telemedicine platform for mental health for employees paid by employers, and healthcare SaaS is an area that we’ve also invested in a lot. In fact, its founder, Dallen Allred, is someone whose earlier company, Artemis Health, is another portfolio company.

TC: Out of curiosity, how did Peterson get involved with Bonobos?

IS: Co-founders Andy Dunn and Brian Spaly were students of our founding partner, Joel Peterson, at Stanford GSB. GSB is a key area of deal flow for us. Joel has been teaching there for almost 30 years. Ben [Capell, a partner with Peterson since 2010] has been involved in backing over 20 companies in the last eight years led by Stanford GSB alumni, and I’ve been guest lecturing there for seven years.

TC: You don’t invest exclusively in Utah, but you spend much of your time with local startups. How has the Utah scene changed since Peterson swung open its doors?

IS: Peterson dates back to 1995, so we’ve been fixtures in the Utah market for 25 years as a firm. When we started Peterson Ventures in 2008 investing Joel’s personal capital — it’s now a mix of institutions, family offices and high-net-worth individuals — there were no seed-stage firms. Now there are three institutional seed-stage firms, several Series A firms that will also invest in seed-stage startups, and active family offices and angel investors.

Also, where the firm used to have to work hard to convince coastal firms to invest in Utah we now have an abundance of mid- and late-stage investors from both coasts spending significant time and
investing meaningful dollars here.

Categories: Business News

TC Sessions Mobility 2020 kicks off in two weeks

2020, September 24 - 3:11am

Holy cats, it’s less than two weeks until TC Sessions: Mobility 2020 kicks off for two program-packed days focused squarely on mobility and transportation technology. On October 6-7, thousands of people from around the world will gather virtually to talk trends, demo products, share insight and discover new opportunities to drive their business into the future.

Don’t have your pass yet? We offer different price levels to accommodate a range of budgets: General admission, group discounts, student discounts and our brand-new Expo Ticket — just $25. Want to showcase your startup in the expo? Buy an Early-Stage Startup Exhibitor Package while you can. We have only a few spots left.

Don’t wait: Buy your pass today. Prices increase on October 5.

Now that we have the housekeeping out of the way, let’s talk about what you can expect at TC Sessions: Mobility 2020.

We packed the event agenda with world-class speakers. You’ll hear from and engage with the industry’s top leaders and innovators across the mobility spectrum. Interested in electric vehicles? No one knows more about the batteries that fuel them than JB Straubel, co-founder and CEO of Redwood Materials and Celina Mikolajczak, vice president of battery technology for Panasonic Energy of North America. There’s a conversation you won’t want to miss.

Does Polestar have enough of what it takes to go head-to-head with Tesla? Get the info when Polestar CEO, Thomas Ingenlath joins us for a fireside chat about the company and the future of electric vehicles.

Nothing happens without funding, but are VC dollars enough to move the industry needle in the right direction? Investors Reilly Brennan, Amy Gu and Olaf Sakkers will debate the uncertain future of mobility technology.

You’ll find more than 40 early-stage startups (and even a few more established companies) holding forth in our expo. Whether you’re looking for new partners, potential customers, a baby unicorn for your portfolio, employment opportunities or simple inspiration, explore the expo and get your networking mojo running.

Love it or hate it, networking is essential to success. Take advantage of CrunchMatch, our free AI-powered platform. It’s the perfect tool for navigating a virtual conference. Answer a few quick questions when you register and CrunchMatch will search for and find attendees who align with your business goals. You can use it for random, free-form searching, too. Schedule 1:1 video calls to talk shop, view product demos, pitch investors or impress potential employers.

We added a new event this year — Pitch Night. Ten early-stage startups will compete in front of a panel of VC judges on October 5, the night before Mobility 2020 officially opens. Five of those intrepid startups will earn the right to pitch from the main stage on October 6. Talk about a must-see throwdown.

So much to do in just two short days — we haven’t even talked about the breakout sessions. TC Sessions Mobility 2020 is right around the corner. Get excited, get focused and get ready to take advantage of every juicy opportunity. But first, get your pass — whatever flavor floats your autonomous boat — before the prices go up.

Is your company interested in sponsoring or exhibiting at TC Sessions: Mobility 2020? Contact our sponsorship sales team by filling out this form.

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Categories: Business News

Selling a startup can come with an emotional cost

2020, September 24 - 2:27am

Every founder dreams of building a substantial company. For those who make it through the myriad challenges, it typically results in an exit. If it’s through an acquisition, that can mean cashing in your equity, paying back investors and rewarding long-time employees, but it also usually results in a loss of power and a substantially reduced role.

Some founders hang around for a while before leaving after an agreed-upon time period, while others depart right away because there is simply no role left for them. However it plays out, being acquired can be an emotional shock: The company you spent years building is no longer under your control,

We spoke to a couple of startup founders who went through this experience to learn what the acquisition process was like, and how it feels to give up something after pouring your heart and soul into building it.

Knowing when it’s time to sell

There has to be some impetus to think about selling: Perhaps you’ve reached a point where growth stalls, or where you need to raise a substantial amount of cash to take you to the next level.

For Tracy Young, co-founder and former CEO at PlanGrid, the forcing event was reaching a point where she needed to raise funds to continue.

After growing a company that helped digitize building plans into a $100 million business, Young ended up selling it to Autodesk for $875 million in 2018. It was a substantial exit, but Young said it was more of a practical matter because the path to further growth was going to be an arduous one.

“When we got the offer from Autodesk, literally we would have had to execute flawlessly and the world had to stay good for the next three years for us to have the same outcome,” she said at a panel on exiting at TechCrunch Disrupt last week.

“As CEO, [my] job is to choose the best path forward for all stakeholders of the company — for our investors, for our team members, for our customers — and that was the path we chose.”

For Rami Essaid, who founded bot mitigation platform Distil Networks in 2011, slowing growth encouraged him to consider an exit. The company had reached around $25 million run rate, but a lack of momentum meant that shifting to a broader product portfolio would have been too heavy a lift.

Categories: Business News

Fundraising lessons from David Rogier of MasterClass

2020, September 24 - 2:10am
Nathan Beckord Contributor Share on Twitter Nathan Beckord is CEO of Foundersuite.com, a software platform for raising capital and managing investors that has helped entrepreneurs raise over $2 billion since 2016. He is also the host of Foundersuite’s How I Raised It podcast. More posts by this contributor

Conventional wisdom says your company should be up and running and have some traction before you raise. But MasterClass co-founder David Rogier says entrepreneurs should try to raise funds before launching.

Before going live, David raised $6.4 million — $1.9 million in a seed round and $4.5 million in a Series A — for what would become MasterClass. To date, the company has raised six funding rounds and secured almost $240 million.

MasterClass’s first investment actually came from Michael Dearing, the founder of VC firm Harrison Metal and one of David’s business school professors. After graduating from Stanford University Graduate School of Business, David started working for Michael at the firm. About a year in, he quit to start his own company.

When David gave his notice, Michael told him he would invest just under $500,000, even though David didn’t have an idea yet.

“I was honored, I was thrilled and I was terrified, all within the span of 10 seconds,” David says. “It was an amazing gift, but I also felt an immense amount of pressure. I knew this was a once-in-a-lifetime chance, and I didn’t want to mess it up.”

He drew a blank for a year, but finally got inspiration from a story his grandmother told him when he was in second grade. In it, she stressed the importance of education, the one thing no one can ever take away from you. Upon remembering that lesson, David knew he wanted to give as many people as possible the opportunity to learn from the best, and MasterClass was born.

In an episode of How I Raised It, David shares some of his secrets to raising capital.

First money, then metrics

Securing funding before you even launch your company definitely isn’t a common practice. But David is adamant that you should attempt it.

“Your metrics out of the gate are never going to be great,” David says. “You need enough funds to have the time to actually improve them.” At the beginning, instead of relying on data, you should sell investors on your vision.

Of course, this is easier said than done. Many investors don’t want to give you a dime until you’ve proven your concept works. To overcome this barrier, David figured out what he could do to help minimize risk for investors.

Categories: Business News

Kard raises another $3.5 million for its challenger bank for teens

2020, September 24 - 1:44am

French startup Kard has added $3.5 million (€3 million) to its seed round. The company already raised the same amount last year, which means that Kard has raised $7 million (€6 million) in total for its seed round.

Founders Future is leading the round, with Laurence Krieger, Michael Vaughan, Jon Oringer and Iris Mittenaere also participating.

Kard is building a challenger bank specifically designed for teenagers. When you create an account, you receive your own IBAN and a Mastercard debit card. You can block and unblock the card, you receive instant transaction notifications and you can send and receive money with other Kard users.

For the past year, the service has been completely free and 50,000 teenagers signed up. Starting today, Kard is switching to paid subscriptions for new users. Each family has to pay €4.99 per month or €49.90 per year to create a family account. After that, you can create as many accounts as you want — if you have two, three or four children, it still costs €4.99 per month.

With today’s change, Kard is also adding some additional features. Parents can download the Kard app and manage allowances from the app. You can schedule weekly or monthly transfers, block your child’s card and send money instantly by pairing a card with the app.

As for teenagers, Kard users now get a virtual card for online payments. As a Kard user, your smartphone is insured against screen damage (up to €100). There are now three different card designs as well — black, silver or pink.

The startup says that Apple Pay and Google Pay are on the roadmap, as well as money pots. There will be some personalized discounts in the app as well, which could open up a new revenue stream.

Kard competes with PixPay, Xaalys, Vybe, but also Revolut Junior, Lydia and services from traditional banks. Let’s see how the new pricing strategy affects Kard’s growth going forward.

Categories: Business News

How Robinhood and Chime raised $2B+ in the last year

2020, September 23 - 11:40pm

Last night Robinhood, the American fintech unicorn that provides free securities trading services to consumers via an app, announced that it raised an additional $460 million in its previously known Series G. That round is now worth $660 million at an $11.7 billion post-money valuation.

A little over a month ago Robinhood announced that it had raised a $200 million Series G, bringing its valuation to $11.2 billion at the time.

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The company previously raised a two-part Series F this year, worth $600 million, bringing its total capital raised to well-north of the $1 billion mark for the year.

But Robinhood is not alone in posting such epic fundraising numbers.

American neobank Chime rode the pandemic-induced general savings-and-investing boom, raising a $485 million Series F a few days ago. That round came less than a year after Chime had raised a mammoth Series E last December.

Two different American fintech giants each raised more than $1 billion in under a year. That’s quite the feat. This morning as a refresher for us both, we’re going over what we know about recent growth from each company, as those metrics should help us understand why the two former startups are worth so damn much money.

Growth

We begin with Chime, which raised back in December of 2019. Around that time there were a grip of stories written about the company that included estimates of its revenue scale in the year:

The CNBC number was the last to be reported, meaning that was probably the most accurate. But each included lots of growth. The $200 million revenue figure was still a quadrupling compared to Chime’s 2018 result, according to the same Forbes story.

Categories: Business News

WhyLabs brings more transparancy to ML ops

2020, September 23 - 11:30pm

WhyLabs, a new machine learning startup that was spun out of the Allen Institute, is coming out of stealth today. Founded by a group of former Amazon machine learning engineers, Alessya Visnjic, Sam Gracie and Andy Dang, together with Madrona Venture Group principal Maria Karaivanova, WhyLabs’ focus is on ML operations after models have been trained — not on building those models from the ground up.

The team also today announced that it has raised a $4 million seed funding round from Madrona Venture Group, Bezos Expeditions, Defy Partners and Ascend VC.

Visnjic, the company’s CEO, used to work on Amazon’s demand forecasting model.

“The team was all research scientists, and I was the only engineer who had kind of tier-one operating experience,” she told me. “So I thought, “Okay, how bad could it be? I carried the pager for the retail website before. But it was one of the first AI deployments that we’d done at Amazon at scale. The pager duty was extra fun because there were no real tools. So when things would go wrong — like we’d order way too many black socks out of the blue — it was a lot of manual effort to figure out why issues were happening.”

Image Credits: WhyLabs

But while large companies like Amazon have built their own internal tools to help their data scientists and AI practitioners operate their AI systems, most enterprises continue to struggle with this — and a lot of AI projects simply fail and never make it into production. “We believe that one of the big reasons that happens is because of the operating process that remains super manual,” Visnjic said. “So at WhyLabs, we’re building the tools to address that — specifically to monitor and track data quality and alert — you can think of it as Datadog for AI applications.”

The team has brought ambitions, but to get started, it is focusing on observability. The team is building — and open-sourcing — a new tool for continuously logging what’s happening in the AI system, using a low-overhead agent. That platform-agnostic system, dubbed WhyLogs, is meant to help practitioners understand the data that moves through the AI/ML pipeline.

For a lot of businesses, Visnjic noted, the amount of data that flows through these systems is so large that it doesn’t make sense for them to keep “lots of big haystacks with possibly some needles in there for some investigation to come in the future.” So what they do instead is just discard all of this. With its data logging solution, WhyLabs aims to give these companies the tools to investigate their data and find issues right at the start of the pipeline.

Image Credits: WhyLabs

According to Karaivanova, the company doesn’t have paying customers yet, but it is working on a number of proofs of concepts. Among those users is Zulily, which is also a design partner for the company. The company is going after mid-size enterprises for the time being, but as Karaivanova noted, to hit the sweet spot for the company, a customer needs to have an established data science team with 10 to 15 ML practitioners. While the team is still figuring out its pricing model, it’ll likely be a volume-based approach, Karaivanova said.

“We love to invest in great founding teams who have built solutions at scale inside cutting-edge companies, who can then bring products to the broader market at the right time. The WhyLabs team are practitioners building for practitioners. They have intimate, first-hand knowledge of the challenges facing AI builders from their years at Amazon and are putting that experience and insight to work for their customers,” said Tim Porter, managing director at Madrona. “We couldn’t be more excited to invest in WhyLabs and partner with them to bring cross-platform model reliability and observability to this exploding category of MLOps.”

Categories: Business News

Submer is dunking servers in goo to save the planet

2020, September 23 - 10:44pm

Digital technologies now serve as the central nervous system for the global economy, and making that nervous system work depends on networks of massive data centers that hoover up enormous amounts of power to keep businesses operating around the world.

It’s not just keeping those data centers on; keeping the rows and rows of servers that house all the data in a climate-controlled environment so they can operate effectively comes with a massive heating and cooling bill.

As companies struggle to address their energy consumption in an effort to reduce their carbon footprint, they’re going to need to find ways to use less energy to keep the servers going. That’s where Submer comes in.

The Spanish company has developed a new way to store and cool servers. Basically, it dunks them in an eco-friendly goo that the company’s founders have designed, and stores them in specialized containers. The company’s founders said the approach can reduce energy consumption by 50%, reduce water use by 99%, and take up 85% less space.

Submer’s story actually starts with a rejection. The company was founded by Pol Valls, a former programmer and engineer, and his brother-in-law, Daniel Pope, who operated a data center business that was sold to Telefonica.

Four years ago the two men began brainstorming ways to make data centers operate more efficiently. They’d reached out to a few engineers and material science technologists that they’d known through their various networks and started developing a new material that was non-toxic, non-flammable and biodegradable. The idea was to submerge servers in containers filled with the goo to have them operate more efficiently.

Impressed with their own ingenuity, the two founders pitched Y Combinator. They made it to the final round, but ultimately weren’t accepted by the early-stage accelerator program.

“At that time, without having anything except for a crazy idea… we didn’t get into the batch, but we made it through the interview stage,” said Valls.

The two men, working in concert with retired engineers coming from the world of industrial thermodynamics, developed three initial prototypes. After six attempts, they’d gotten the product to a place where they thought they could take it to customers.

Submer isn’t the only company working with the concept of using liquid to cool servers. Microsoft recently publicized the results of an experiment off the coast of Scotland where it used ocean water to submerge servers and had the natural environment work to cool and store the hardware.

Microsoft’s Project Natick underwater data center experiment confirms viability of seafloor data storage

Valls said the approach from Microsoft was interesting, but doesn’t solve some of the key problems that new infrastructure technologies for data centers need to address.

Chiefly, computing needs to happen closer to applications that require real-time operations. Those are new 5G networking technology, smart cars and other innovations.

“Hyperscalers and data centers are trying to move infrastructure to the city center to reduce delays in communications,” Valls said. “Delays are dependent on the compute and where the user is… low latency applications will require more and more compute close to the city center.”

Submer’s approach was compelling enough for the company to raise roughly $12 million in new financing from a group of investors led by the Swedish impact investment firm Norrsken VC (the investment arm of the non-profit Norrsken Foundation) and Tim Reynolds, the retired co-founder of Jane Street Capital. Founded by one of the co-founders of Klarna, the European fintech unicorn, Norrsken focuses on technologies and services that promote the UN sustainable development goals of financial inclusion and sustainable development.

“Data centers power human advancement. Their role as a core infrastructure has become more apparent than ever and emerging technologies such as AI and IoT will continue to drive computing needs. However, the environmental footprint of the industry is growing at an alarming rate,” said Alexander Danielsson, investment manager at Norrsken VC. Danielsson said that Submer’s solution represented a compelling potential solution.

What’s likely equally compelling is the size of the market, which is expected to reach $25 billion, according to data from Global Market Insights. 

Categories: Business News

Venture capitalists have found a new home to brag and debate: PrimeTime VC

2020, September 23 - 10:40pm

Last week, we talked a bit about how investors are seeking new techniques to bring humanity back to their deal flow and sourcing mechanisms, beyond the boring Zoom call. The newest strategy I’ve seen is PrimeTime VC, a game show that pits venture capitalists against each other to debate topics, from TikTok to Y Combinator Demo Day to Snowflake’s IPO.

With ESPN-like graphics, investors are led through a series of questions by host Charlie Stephens (who runs his own live show interviewing tech executives). Its tag line? “The show of accredited banter.”

Yes, you read that right. Here’s the latest episode:

PrimeTime VC launched its pilot episode on August 17 and is releasing episodes every two weeks. It is eyeing weekly releases in 2021. In terms of production, it uses Zoom, After Effects and Final Cut Pro.

The show has racked up 30,000 views, and sponsorships from First Republic Bank, TechDay and Entre to help with production costs. It still has a lot of room to grow. (At time of publication, the YouTube channel has 63 subscribers, and the Twitter account has 15 followers).

The show came together after Tyler Kelly, founder of Pitch Madness, teamed up with Leaders Live hosts Charlie Stephens and Nidal Harvey. The trio put together a founder debate competition online to raise money for front-line workers. Then, they saw an opportunity to grow the show.

Investors who want to sign up can submit a form. Participants on the show include Nihal Mehta of Eniac VC, Jenny Friedman of Supernode Ventures, Paul Martino of Bullpen Capital, Lo Toney of Plexo Capital, Sydney Thomas of Precursor Ventures and John Frankel of FF VC.

“The show is also an outlet for VCs to casually promote their portfolio companies in a relevant way, but if they go overboard with it, that’s when the point deduction comes into play,” Kelly said. The real deal sweetener, though, might be what the winner gets: 30 to 45 seconds of a monologue at the end of the show.

“You can’t stop VCs talking about their companies,” Mehta said. That’s part of our job.”

The last winner, Bullpen Capital’s Paul Martino, used his time to urge startups to build.

“I can’t wait for this to be a big successful thing like some of our startups,” Martino said.

Down the road, Kelly hopes PrimeTime programming could become premium content and partner with a “large streaming network.”

Until then, let the “accredited banter” roll.

Categories: Business News

Dear Sophie: Possible to still get through I-751 and citizenship after divorce?

2020, September 23 - 10:22pm
Sophie Alcorn Contributor Share on Twitter Sophie Alcorn is the founder of Alcorn Immigration Law in Silicon Valley and 2019 Global Law Experts Awards’ “Law Firm of the Year in California for Entrepreneur Immigration Services.” She connects people with the businesses and opportunities that expand their lives. More posts by this contributor

Here’s another edition of “Dear Sophie,” the advice column that answers immigration-related questions about working at technology companies.

“Your questions are vital to the spread of knowledge that allows people all over the world to rise above borders and pursue their dreams,” says Sophie Alcorn, a Silicon Valley immigration attorney. “Whether you’re in people ops, a founder or seeking a job in Silicon Valley, I would love to answer your questions in my next column.”

“Dear Sophie” columns are accessible for Extra Crunch subscribers; use promo code ALCORN to purchase a one- or two-year subscription for 50% off.

Dear Sophie:

I work at a tech company, married a U.S. citizen two years ago and got a two-year green card. The relationship went south and I needed to leave to protect my daughter and me. I want to get divorced, but can we keep our green cards?

Will we be able to apply for U.S. citizenship?

— Hopeful in Hayward

Dear Hopeful,

Thank you for reaching out and sharing the story of your courage to do the right thing for yourself and your child. Good news — U.S. immigration laws have been designed to protect individuals who have been subject to abuse or extreme cruelty, which is not limited to physical harm but can also include emotional abuse. So, yes, you and your daughter can apply for a permanent green card even if you divorce your U.S.-citizen spouse. And yes, you can also apply for U.S. citizenship when you are eligible. My law partner, Anita Koumriqian, and I discuss the naturalization and citizenship process in more detail in this podcast.

You will need to file a petition (Form I-751) with U.S. Citizenship and Immigration Services (USCIS) to seek to have the conditions on your and your daughter’s two-year conditional green card removed. Usually, individuals with a conditional green card must file a petition within 90 days of when the conditional card is set to expire. However, an abused spouse or the parent of an abused child can file this petition at any time. I recommend consulting with an experienced immigration lawyer before filing this petition. You will be allowed to have your attorney go with you to the USCIS interview that will be required as part of this process.

Conditional green cards cannot be renewed. Individuals who fail to file a petition to remove the conditions run the risk of being deported. Once the conditions are removed, a green card will be valid for 10 years. This process can involve extensive documentation and the possibility of attending an in-person interview. One of the reasons that it’s important to speak to an immigration attorney about this process, especially in California, is because divorce can take at least six months and the timing of the legal processes can affect the outcome of your green card.

Down the road, when the time comes for citizenship, here are the requirements to apply for the naturalization process. You must have:

Categories: Business News

Japanese startup Nature launches Remo 3, its home appliance smart remote, in the US and Canada

2020, September 23 - 10:00pm

Nature, a Japanese hardware startup that focuses on IoT home devices, announced the launch of Remo 3, its home appliance smart remote, in the United States and Canada today. Priced at $129, the Bluetooth-enabled Remo 3 allows people to control with their smartphones or smart speakers multiple appliances that use an infrared remote, including air conditioners, TVs, robot vacuum cleaners and fans.

Nature claims that its Remo series is Japan’s top smart remote, with more than 200,000 units sold so far. The Remo 3, designed to be mounted on a wall, also has sensors for temperature, humidity, lighting and movement, allowing users to create customized settings for when they want devices to turn on or shut off. Remo 3’s app also has a GPS location feature, so appliances can turn on automatically as users get closer to their homes.

As COVID-19 forces people to spend more time at home than usual, many are embarking on home improvement projects.

Even though people may be reluctant to purchase new appliances because of the economic downturn, relatively inexpensive products like the Remo 3 may still attract buyers because it can help reduce energy consumed by devices they already own. The Remo 3 also adds another layer of functionality to smart speakers and before the pandemic, global smart speaker sales hit a record high last year, with 146.9 million units shipped. The Remo 3 is compatible with Amazon smart speakers like the Echo Dot, as well as Google Home and Apple HomePod speakers.

Nature founder and chief executive Haruumi Shiode told TechCrunch that Nature conducted a pilot with Kansai Electric, one of the largest utility providers in Japan, to prove that it can lower the amount of electricity used by air conditioners. He added that the pandemic actually accelerated sales of Nature Remo devices in Japan and prompted the company’s decision to launch in the U.S.

The COVID-19 pandemic made mass-producing the Remo 3 more challenging because Nature’s team was no longer able to make monthly trips to Shenzhen, Shiode said. But the Remo 3 is the sixth product Nature has launched so far, so it was able to figure out how to work with factories remotely on production and quality assurance.

“I read that since the pandemic started, 70% of Americans are tackling home improvement projects,” Shiode added. “Similarly, people around the world have been looking for ways to make their shelter-in-place less mundane and more convenient. With the Nature Remo 3, we hope to offer the same convenience and efficiencies to the American market as we have in Japan.”

Categories: Business News

Five years after creating Traefik application proxy, open-source project hits 2B downloads

2020, September 23 - 9:23pm

Five years ago, Traefik Labs founder and CEO Emile Vauge was working on a project deploying thousands of microservices and he was lacking a cloud-native application proxy that could handle this kind of scale. So like any good developer, he created one himself, and Traefik was born.

If you go back five years, the notion of cloud native was still in its infancy. Docker has been doing containers for just a couple of years, and Kubernetes would only be released that year. There wasn’t much cloud-native tooling around, so Vauge decided to build a cloud-native reverse proxy out of pure necessity.

“At that time, five years ago, there was no reverse proxy that was good at managing the complexity of microservices at cloud scale. So that was really the origin of Traefik. And one of the big innovations was its automation and its simplicity,” he said.

As he explained it, a reverse proxy needs to have several features, like traffic management, load balancing, observability and security, but much of this had to be done manually with the tools available at the time. As it turns out, Vauge had stumbled onto a major pain point.

“Initially I created Traefik for myself. It was a side project but it turned out that there was a huge interest and very quickly a community gathered around the project,” he said. After a few months, he realized he could build a company around this and left his job to start a company called Containous.

Today, he changed the name of that company to Traefik Labs and the open-source project he developed has become wildly popular. “Five years later we are at 2 billion downloads. It’s in the top 10 most downloaded projects on Docker. We have 30,000 stars on GitHub. So basically it’s one of the largest open-source projects in the world,” he said. In addition, he said there are more than 550 individuals contributing to the project today.

When he formed Containous, he developed an open core-based commercial project designed for enterprise needs around scaling, high availability and more security features. Today, that includes the Traefik Proxy and an open-source service mesh called Traefik Mesh.

Among the companies using the open-source project today are Conde Nast, eBay Classifieds and Mailchimp.

Vauge certainly was in the right place at the right time five years ago, which he modestly attributes to luck because he was working at one of the few companies at the time that was dealing with microservices at scale. “We had to build a lot of things, and Traefik was one of those things. So I was basically lucky because I created Traefik at the right time,” he said.

Not surprisingly, a company with that kind of open-source traction has attracted the interest of venture capitalists, and Vauge has raised $16 million since he launched his company in 2015, including $10 million led by Balderton Capital in January.

How Kubernetes came to rule the world

Categories: Business News

Founded by former SpaceX engineers, First Resonance pitches tools to make things the SpaceX way

2020, September 23 - 9:04pm

After operating in stealth mode for about two years, First Resonance, a company founded by former SpaceX engineers, is finally showing the world their software toolkit designed to let manufacturers make things using the processes employed by their former boss.

It’s a suite of software products that can allow for more flexible manufacturing processes and one that can handle the pressures of remote monitoring for companies making hardware in the age of social distancing brought on by the COVID-19 pandemic.

“Our first few customers really grew using [the software] and facilitating that at-home factory workflow,” said First Resonance co-founder Karan Talati. 

The software that First Resonance has developed allows manufacturers to coordinate their workflow processes. “This is really driven off of us being in that driver’s seat at SpaceX and working with our counterparts in manufacturing and refurb,” Talati said. “Underlying it all is a data platform that allows these companies to make use of insights to improve their designs as well as their manufacturing processes.”

On the process side, that means reducing waste, and making the manufacturing of goods more efficient. But the software — and the information it’s collecting from manufacturing — can be used to inform better design decisions and the upstream product development process, Talati said.

Already the company’s tech is being used by a crew of cutting-edge manufacturers, including Phase FourJoby Aviation and Iron Ox.

Admittedly, the software works best for companies that are building new manufacturing processes and capabilities and don’t have a lot of legacy infrastructure to start with. Part of the reason that Tesla and SpaceX have been able to achieve the cost reductions they have is by redesigning systems to operate more flexibly and adapt to information that’s coming off the product line, Talati said. “That’s how we were able to achieve the order of magnitude cost reduction that is the Falcon 9… applying data upstream and feeding that data back and embracing that chaos.”

Talati said that many manufacturers rely on processes that are overly rigid and need to be untangled. Already, big aerospace, defense and auto manufacturers are acquiring or partnering with newer manufacturing startups to take advantage of the expertise and flexibility these companies offer. Talati pointed to Millennium Space System’s acquisition by Boeing and the contract that Hermeus received to design a hypersonic Air Force 1 jet. “We really evolve through enabling that new culture of agile manufacturing,” Talati said.

The company currently has six customers (with the bulk of them signing on in June and July) and charges per-seat in a traditional software as a service model.

To date, First Resonance has raised less than $2 million from local Los Angeles investors, including Fika Ventures, Wavemaker, Stage Venture Partners and Village Global. 

The Los Angeles-based company harvested talent from SpaceX, NASA, Lexus and other aerospace and car manufacturers, and is tackling an emerging market for industrial software that could reach $14.9 billion, according to research from the analytics firm Markets and Markets provided by the company. 

Much of that demand is being driven by the diaspora of SpaceX talent into the broader aerospace and defense and manufacturing ecosystem, said Talati. That’s also a great selling point for the company when it makes its pitch, he said.

“That makes it quite easy for us… there’s a very easy way for us to say, ‘That thing we were working on together… Well… We’re doing it at the kind of unit economics where you don’t need a billionaire CEO to finance it.’ ”

The lessons from SpaceX around empowering individuals and giving them connectivity into the system enables the company to continue to innovate on its iterative products, Talati said. And First Resonance is providing a toolkit other companies can use to bring that mindset into their own manufacturing.

“We invested in First Resonance because the founders Karan and Neal are uniquely qualified to build this company thanks to their experience at SpaceX and Uptake Technologies,” said Mikal Khoso, associate, Wavemaker Partners, in a statement. “The digitization of manufacturing is a long-overdue revolution in an industry full of outdated technology and methods. First Resonance is building the factory operating system for modern manufacturing, helping hardware companies build 21st-century products in a 21st-century fashion.”

Categories: Business News

Zoom’s earliest investors are betting millions on a better Zoom for schools

2020, September 23 - 9:00pm

Zoom was never created to be a consumer product. Nonetheless, the video-conferencing company’s accessibility made it the answer to every social situation threatened by the pandemic, from happy hours to meetings.

Months later, we’re realizing that force-feeding social experiences into an enterprise software company isn’t a perfect solution. Zoom School is a perfect example of what’s not working: Remote education is a hot mess for students, teachers and parents. Instructors, who could once engage a classroom through whiteboard activities, mini-group presentations and one-on-one discussions, are now stuck to one screen.

Well more than six months into a global pandemic, former Blackboard CEO and former PrecisionHawk CEO Michael Chasen is daring to dream: What if we didn’t assume Zoom was a Band-Aid fix for schools? What if someone created a Zoom experience that was designed, not just marketed, for classrooms?

“If I told you that the majority of classes being held online today, teachers couldn’t take attendance, hand out assignments, give a test or a quiz, grade anything or talk one on one with students, you would say how is teaching and learning even happening?” he told TechCrunch.

Chasen is launching a new company, ClassEDU, with a first product that isn’t too shy about its ambitions, named Class for Zoom. Although the name might convince you that it’s a third-party add-on to Zoom, it’s an entirely independently owned company. And it’s built for teachers who need to find a way to create more-engaging, live-synchronous learning.

When a teacher logs into the Zoom call, they’ll be brought to a screen that looks like this:

Image Credits: ClassEDU

As you can see, they can toggle between the classroom, assignments, tests and quizzes, or the whiteboard. Instead of unorganized tab time, the teacher can take the video call as a one-stop shop for their entire lesson, from syncing materials from the CMS system to polling students on their thoughts to grading the quiz they just took. It’s a full-suite solution, and an ambitious one at that.

The best way to break down Class for Zoom’s features is by separating them into two buckets: instruction tools and management tools.

On the instruction side, Class for Zoom helps teachers launch live assignments, quizzes, and tests, which can be completed by students in real time. Students can also be polled to motivate engagement. Instructors can be granted access to unmute a class or mute a class during appropriate times.

Image Credits: ClassEDU

The marquee feature of the instruction tools is that teachers and students can talk privately without leaving the Zoom call if there’s a question. This is key for shy students who might not want to speak up, inspired by Chasen’s daughter, who struggled to share in front of an entire classroom.

Image Credits: ClassEDU

On the management side, tools range from attendance trackers to features that allow a teacher to see how much time a student is participating in activities. Chasen, who founded Blackboard when he was in college, also gave a nod to his prior company by allowing teachers to integrate CMS systems right into the Zoom classroom.

Less popular, Chasen jokes, is Class for Zoom’s ability to give teachers intel on if a student has Zoom as the primary app in use on their screen. The attention-tracking feature is not new, but it is oversight some people might not be okay with. Students can disable the ability to track focus, but administrators can make it mandatory. The platform also allows teachers to monitor a student’s desktop during an exam to limit cheating.

Class for Zoom’s access to a student’s personal computer could make some users uncomfortable. Zoom has been banned from some school districts due to security concerns, and a wave of Zoombombing attacks, where an unwanted participant hacks into a call and streams inappropriate or offensive content. In response, the video conferencing company has put in security measures, such as verification tools and waiting rooms.

Chasen says that Class for Zoom is balancing its access to information by giving students the option to opt into tracking features versus forcing them to.

Class for Zoom isn’t the only startup trying to make Zoom a better experience. A number of tools built atop Zoom have launched in the past few months, partially because the price of Zoom’s SDK is $0. Macro raised $4.3 million to add depth and analysis to Zoom calls, with an interface that tracks metrics like speaker time and notes. It has more than 25,000 users. Mmhmm got buzz in July for its creative demo that lets users create a broadcast-style video-conferencing experience atop their videoconferencing platform of choice.

Somewhat predictably, Zoom launched a competing feature with Mmhmm that calls into question whether the startups that layer atop incumbents look more like features instead of full-fledged platforms.

Of course, one threat to any of these products is Zoom’s mood. If Zoom tweaks its policy on SDK and API, it could completely wipe out Class for Zoom. But Chasen has reason to be optimistic that this won’t happen.

Today, Class for Zoom announced that it has raised a $16 million seed round, pre-launch, co-led by Deborah Quazzo of GSV Ventures and Santi Subotovsky of Emergence Capital and a current Zoom board member. Other investors includee Jim Scheinman of Maven Partners, an early investor in Zoom and the person who is credited with naming Zoom; Bill Tai, who is Zoom’s first committed backer; Steve Case, co-founder of AOL and CEO of Revolution.

When asked if the Zoom investor involvement works as “insurance” to protect the startup, Chasen said he didn’t view it like that. Instead, the founder thinks that Zoom is focused more on scale than in-depth specialization. In other words, Zoom isn’t going to pull a Twitter, but instead likens the platform’s developer friendliness to that of Salesforce, which has tons of tools built atop of it. Second, Class for Zoom is a certified Zoom reseller, and makes money off of commission when a district buys Zoom through them. The informal and formal partnerships are enough glue, it seems, for Chasen to bet on stability.

As for whether the technology will stay exclusive to Zoom, Chasen says that it’s the main focus because Zoom is the “de facto industry standard in education.” If other platforms pick up speed, Chasen says they are open to experimenting with different software.

Chasen declined to share exact numbers around pricing, but said that it is a work in progress to find a price point that districts can afford. It’s unclear whether the company will charge per seat, but the founder said that it will charge some type of subscription service fee.

Accessibility in edtech solutions often relies on the medium that the technology and instruction lives on. For example, even if a product is free to use, if it needs high-speed internet and a Mac to work then it might not be accessible to the average home in America. The digital divide is why products often test usability on Chromebooks, low-cost computers that low-income students, teachers and school districts employ.

In Class for Zoom’s case, the first iteration of the product is being rolled out for teachers with Macintosh computers, which could leave out some key demographics due to expense. It’s worth noting that while students can still participate in a class being run on Class for Zoom without the software, the view, tracking and engagement software will be missing.

Thankfully, the new financing will be used to help ClassEDU build software that is usable on low-cost computers such as Chromebooks, as well as Windows, Android or iPhones. When that happens, teachers and students can both benefit from a more engaging view.

Chasen said that the idea for the startup began brewing just weeks into quarantine, when his three kids began learning from home. Months later, Class for Zoom is finally set to launch its beta version and is opening up its waitlist today. By January, Chasen hopes, it will be accessible to any school that wants it.

Categories: Business News

Endel raises $5M to create personalized ‘sound environments’ that improve productivity and sleep

2020, September 23 - 8:00pm

The pitch for Berlin-based Endel is pretty straightforward, according to its co-founder and CEO Oleg Stavitsky.

“The way I usually describe Endel is: This is a technology that is built to help you focus, relax and sleep,” Stavitsky told me. “Of course, the way we do that is a little more complicated than that.”

The startup is announcing today that it has raised $5 million in Series A funding led by Kevin Rose of True Ventures, with participation from SleepScore Ventures, Techstars Ventures (Endel was part of the Techstars Music Accelerator), Impulse Ventures, Plus 8 Equity Partners, Waverley Capital, Amazon Alexa Fund, Target Global and various angel investors.

Stavitsky said that the team previously worked together on children’s app company Bubl. After selling Bubl, Stavitsky said they began to explore the opportunities around sound — after all, he noticed the growth of playlists designed to help with things like sleep and focus, as well as the growth in mindfulness apps.

“When we started, we said, ‘Let’s just build this machine that can generate ambient music,’ ” he recalled. But he said that as the team did more research, they realized, “It has to be personalized. It cannot just be one song or one playlist or one soundscape. It really depends on the space you’re in.”

So that’s essentially what Endel has built. The startup says its Endel Pacific technology creates “sound environments” designed for your needs — whether that’s focusing, sleeping, relaxing or just when you’re on-the-go. Those environments are shaped, in part, by things like the time of day and the weather, as well as the user’s heart rate and motion.

Image Credits: Endel

Rose said he was excited by “this idea of the closed-loop system that uses real-time feedback to manipulate and change the body in a very positive way.” And he emphasized that Endel is “backed by science.”

Stavitsky said Endel’s approach draws on several areas of science, including research around circadian rhythms (so that it complements where you are in your daily sleep cycle), the pentatonic scale (so that its sounds are pleasant) and sound masking (so that you’re less likely to hear anything distracting).

The company is working with partners to do more to validate the science behind its approach, but it says it’s already applied the experience sampling a method developed by psychologist Mihaly Csikszentmihalyi (who developed and wrote the book on the concept of flow) to show that its sound environments can lead to a 6.3x increase in concentration and a 3.6x decrease in anxiety.

I tried it out myself, listening to Endel’s mix of soothing music and white noise as I worked yesterday (including, of course, as I was writing this post). I won’t claim that I felt an immediate or dramatic increase in energy or focus — but as time went on, I noticed I was working for longer than I normally do without getting distracted or tired.

Endel CEO Oleg Stavitsky

The startup has released apps for iOS, Apple Watch, macOS, Amazon Alexa and Android, and it has been downloaded nearly 2 million times. A subscription costs $49.99 per year.

Stavitsky said Endel is also building a significant business around partnerships, for example by working with Japan’s ANA Airlines to feature its technology on planes, and there are supposedly partnerships in the works with automakers and smart speaker manufacturers as well.

The startup has also signed a deal with Warner Music to algorithmically create songs and albums. Stavitsky said he’s hoping to do more work with musicians, so that when they release new music, there can be both a traditional album and also “a functional, adaptive album that is available to you as a soundscape when you have to work, when you want to go to sleep.”

“The big vision is to ultimately go beyond sound,” he added — starting with an Apple TV app due later this year that incorporates video.

Endel has now raised a total of $7.1 million.

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