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Salsify nabs $155M as its commerce experience platform sees a big surge of business from Covid-19

2020, September 23 - 7:00pm

As traditional brands grapple with a new world where selling online is as much or perhaps even more important than how you are positioned in a physical store, a startup that helps them get all their inventory, marketing and selling strategies all on one page has raised a significant round of funding.

Salsify, which provides brands and the companies behind them a single place to track product inventories, manage how they are described and sold across a disparate array of online and offline locations, and then run analytics on the data to figure out what next steps to take, has closed $155 million in a Series E round of financing led by Warburg Pincus, with Matrix, Underscore, Venrock and Greenspring also participating.

Jason Purcell, the CEO and co-founder who co-founded the company with Jeremy Redburn (chief data officer) and Rob Gonzalez (CMO), said the company would not be disclosing its valuation but only confirmed that it was a “significant up round” compared to Salsify’s valuation in its last fundraise, which was $308 million, according to data from PitchBook.

Prior to today Salsify had raised around $98 million, from investors including Underscore, Matrix Partners, Venrock, North Bridge Venture Partners.

The funding is coming on the back of a big 2020 for Salsify, which, like a lot of other companies working in the wider area of e-commerce, has seen strong tailwinds resulting from Covid-19. Specifically, with many continuing to comply with social distancing rules, there has been a big shift for shopping and browsing for goods online.

“Companies realize they need a strong digital footprint,” Purcell said simply in an interview. “Whether it’s Amazon or another marketplace, or their own site, what Covid has done is give many brands a fraction of the thought process: if we don’t have a strong digital footprint, we won’t be able to engage.”

The company is tackling a very fundamental (but I guess “happy”) problem in the world of online commerce. It’s an extremely fragmented landscape, with a huge number of potential ways for a brand to connect with potential customers: their own sites, those of other retailers, larger marketplaces, social channels, direct sales using messaging or email, and much more.

And that’s before you factor in the offline channels that are still very much in use, despite the turn to online shopping for many of us.

This is, in fact, the rationale for the name of the company, too, Purcell told me. The salsify might be known by some as a black root vegetable that looks a bit like a thin white carrot when peeled but with a sweet and mild taste. But it’s also a wildflower that is a bit like a dandelion: it grows everywhere and its blooms spread far and wide, a metaphor for the wide, fragmented world of online commerce. Purcell said he and the founders originally wanted to name the company “Dandelion” but it was taken (indeed, there are a lot of dandelion-themed businesses) so Salsify it was.

The fact that it’s a wide-ranging problem also means that there have been a wide-ranging field of companies that have aimed to tackle it. They include companies like Contently and Sitecore, as well as the likes of Salesforce and Adobe, although Purcell describes his company as “complementary to marketing clouds.” (Notably, it made a big hire from Salesforce two weeks ago: Mike Milburn, formerly Salesforce’s chief customer officer, is now Salsify’s president.)

Salsify counts companies like Coca Cola, Rubbermaid and Mars among its customers. In all, it has some 800 companies and brands on its books with 225 of them pulling in more than $1 billion in revenues, and since its last round, a Series D in 2018, the company has seen a boom in business, with a 120%+ net revenue retention rate.

Purcell said that his company plans to use the funding in two main areas. First, it plans to continue expanding its product stack, currently based around the company’s CommerceXM (for “experience management”) platform, which includes features for managing product information, digital assets, and managing how products are sold through a brand’s own site, marketplaces, online and offline retailers and social channels and more.

Second, the company has its sights set on expanding internationally. The company is based out of Boston, and a couple of years ago it opened its first international headquarters in Lisbon, Portugal. Right now some 40 of its customers are based overseas, and the plan will be to double down on more expansion both serving them, as well as their US customers abroad, as well as picking up new business.

Purcell also added that the round and the choice of lead investor was very much in line with the company’s ambition to eventually go public.

“This is pointing us on the path to an IPO,” he said. “The intent is to build a company that can operate as a public company. It’s about how we hold ourselves against public companies, while making sure we can operate the same from a growth perspective. Warburg Pincus has taken 150 companies public, and we are building with that in mind.”

Warburg Pincus has been a pretty prolific growth-stage investor whose involvement indeed points not to existing scale and success, but wider ambition. Other companies it has backed include CrowdStrike, Avalara, Samsara, Ant Group, Privitar, Trax and Gojek.

“Salsify is a clear market leader, serving some of the largest and most discerning global brands and retailers. The company’s strong track record, paired with a talented leadership team has positioned it well for the increase in demand for digital shelf solutions,” said Vishnu Menon, Managing Director, Warburg Pincus, in a statement.

“We are excited to partner with Salsify in their mission to help brands develop better and longer lasting relationships with consumers online,” said Michael Ding, Vice President, Warburg Pincus.

Categories: Business News

New research shows European startups are spending drastically less on a US launch, for the same gains

2020, September 23 - 5:32pm

It used to be the case that in order to scale globally, European companies needed to spend big on launching in the U.S. to achieve the kind of growth they wanted. That usually meant relocating large swathes of the team to the San Francisco Bay Area, or New York. New research suggests that is no longer the case, as the U.S. has become more expensive, and as the opportunity in Europe has improved. This means European startups are committing much less of their team and resources to a U.S. launch, but still getting decent results. That said, European startups will still look to the U.S. for exits, as European corporates remain laggards in innovation.

New research by Index Ventures today reveals that less than 1 in 5 (50 out of 275) European tech firms are choosing to relocate their engineering base as they expand to the U.S., in stark contrast with the general strategy 10 years ago. Instead, says Index, Europe’s top tech startups are managing to get the growth gains they need out of the U.S. with a much smaller “on the ground” footprint.

The survey of 275 European startups over the last decade (including an in-depth survey of more than 100 firms) indicates that creating U.S.-based engineering, tech and R&D teams has fallen out of favor, and they are staying in Europe for longer, taking advantage of Europe’s much-improved availability of talent and funding.

Between 2008-2014, almost two-thirds (59%) of European startups expanded, or moved entirely, to the U.S. ahead of Series A funding rounds. However, between 2015-2019, this number decreased to a third (33%).

This chimes with research from StackOverflow, which has found that the European tech scene has lifted, with more than 6 million professional developers residing in Europe, compared to just 4.3 million in the U.S. Tightened U.S. immigration rules, and demand outstripping supply, have inflated U.S. tech salaries, which are 42% higher in San Francisco compared to London, making it more expensive and less cost-efficient for European startups to double down in the U.S. — especially when they can achieve similar growth from home.

European founders are also now raising more, with rounds growing from $15.3 billion to $34.3 billion over the past four years.

Danny Rimer, partner at Index Ventures, said in a statement: “While for some founders, and certainly once a business reaches certain milestones, establishing a US base is a good decision, it is becoming increasingly costly and challenging.”

At the same time, however, Index found that European corporates invest three-quarters (76%) less than their U.S. counterparts on software, and this is normally on compliance rather than innovation. This means European startups are likely to continue to look to the U.S. for exits to corporates.

The research findings are revealed in Expanding to the US, Index Ventures’ third handbook for tech founders seeking domestic and international growth. It also includes a “personality test” for startups to figure out at what stage they need to prepare for a U.S. launch.

As well as analysis of 353 European (275) and Israeli (78) VC-backed startups that have expanded into the U.S. over the last 10 years it includes U.S. expansion strategies and interviews with founders who’ve done it.

Categories: Business News

‘AI-powered’ fitness app Freeletics scores $25M Series B

2020, September 23 - 5:00pm

Freeletics, the “AI-powered” fitness coaching app, has closed $25 million in Series B funding. Leading the round is U.S.-based JAZZ Venture Partners and Causeway Media Partners, with support from KKCG.

The fresh injection of capital follows $45 million in Series A funding in late 2018. It will be used by the company to develop new tech, further expand globally and launch new business verticals.

Founded in 2013 and well-established in Europe, Freeletics has been steadily trying to conquer America since its Series A (the company was impressively bootstrapped until then). The Munich, Germany-founded company’s self-described mission is to “challenge and inspire people to become the greatest version of themselves, both mentally and physically.”

The Freeletics app offers AI-powered fitness and mindset coaching, and has 48 million users in more than 160 countries, claiming to be the No. 1 fitness app in Europe with more than 600,000 paid-for subscriptions. The “personal trainer in your pocket” aims to help you train anytime, anywhere, with personalised training plans and workouts. Its algorithms learn from the app’s millions of users and the individual feedback they provide, with the goal of developing “smart” training journeys uniquely designed to suit different users in different contexts.

“While a relatively new player in the U.S., Freeletics is a clear global leader in at-home fitness and we believe they are perfectly positioned to continue leading the fitness industry into the future post-COVID-19 in the U.S. market,” said John Spinale, managing partner at JAZZ Venture Partners. “In an ocean of unpersonalized fitness streaming concepts, they offer a sophisticated and adaptive personal coach for every aspect of performance and well-being — whether mental or physical. This is a promising indication of what is still to come.”

“We want to give anyone the right plan and guidance to reach their goals, on their terms, and ultimately lead to a long-term behavior change so they can continue leading that lifestyle for the rest of their lives,” Freeletics CEO Daniel Sobhani tells TechCrunch. “Not everything the fitness industry has been telling us for the last 30 years has been setting people up for success, so we want to put an end to that and be clear and honest about the work it takes to reach your goals, while making real, sustainable results accessible to as many people as possible. And those goals don’t have to be just losing weight. Whatever the finish line looks like, we want to get people there in the most efficient, sustainable and enjoyable way.

Sobhani says Freeletics’ AI provides “hyper-personalized” fitness coaching, paired with mindset training for a more holistic experience. “The AI-powered coach curates the workouts best suited to every single user, so that they are always super efficient and effective, making it easier to work towards your goal,” he explains. “We focus so much on personalization because, in the end, there is no one-size-fits-all solution when it comes to health and fitness. We then pair this technology with our efforts in the product to reduce the everyday hurdles people face when it comes to working out regularly — time, space, equipment, knowledge, money, confidence and so on.”

The idea is that Freeletics lets you work out on your own terms, in terms of how, when and where you want. For each day of your training plan, the AI coach can draw from 3.5 million options. So, for example, you may want a quiet workout plan without equipment that fits with your small city apartment and that won’t disturb the neighbours. Or one that only requires 15 minutes. Or perhaps you want to lift weights instead. Based on these and a plethora of other criteria, Freeletics promises to adapt to your needs accordingly.

“For the finishing touch, we combine this personalized training experience with the mental component — audio coaching, which aims to educate, motivate and bring more mindfulness to the whole experience,” adds Sobhani. “This mindset coaching builds the sustainable basis for our users to make life-long improvements to their lifestyles, aiming to help them build healthy habits and better understand their journey, all while putting more emphasis on mindfulness and meditation for better long-term results across the board.”

Meanwhile, Freeletics operates a classic freemium model. The app is free to download and use to a certain extent, but for more personal coaching you’ll need to pay for a subscription. This sees the company offer different options with combinations of training, nutrition and mindset coaching for different subscription periods, from one to 12 months.

“Users can get a digital personal coach for less than a cup of coffee a week, which is the more attractive option for most if you compare that with the cost of a personal trainer at the gym,” says the Freeletics CEO. “And on top of that, the app also works to remove any other financial hurdles associated with working out, like gym memberships, equipment, etc. Over the last year we have managed to double our paying subscriber base to over 600,000, which is a real industry benchmark if you look at similar companies.”

Categories: Business News

Apple partner Servify raises $23 million to scale its devices after-sales and management platform overseas

2020, September 23 - 4:43pm

Servify, a Mumbai-headquartered startup that operates a device lifecycle management platform and works deeply with brands, including Apple and Samsung, in a number of geographies, has raised $23 million in a new financing round.

The Series C financing round for the five-year-old startup was led by existing investor Iron Pillar; other existing investors, including Blume Ventures, Beenext and Tetrao SPF, participated in the round. The new round pushes Servify’s to-date raise to $48 million.

Servify works with enterprises such as Apple, Samsung, OnePlus, Xiaomi, Nokia, Motorola and Airtel and handles for its partners after-sales services such as device protection, exchange and trade-in programs, explained Sreevathsa Prabhakar, founder and chief executive of the startup, in an interview with TechCrunch.

The startup, which offers its services through a whitelabel arrangement with enterprises, works with more than 50 brands and reaches over 50 markets. With Apple, it works in three geographies, and in over half a dozen with OnePlus .

The new round, which was oversubscribed, will help the startup expand its expertise in many new product categories and deepen its reach in international markets, said Prabhakar, who has more than a decade of experience in overseeing after-sales and other device management businesses.

“We are keenly interested in unique businesses addressing hard problems in very large and global markets and are excited to continue to back the company in its next phase of growth. Stellar execution by Servify’s team combined with its differentiated technology platform have led to the company’s impressive growth this year despite Covid-19 related challenges,” said Anand Prasanna, managing partner at Iron Pillar, in a statement.

The coronavirus outbreak has deeply impacted the business of Servify, which was profitable in the financial year that ended in March. In April and May, when many countries enforced lockdowns, the startup’s business reached a complete halt. But in the months since, it has not only fully recovered but has grown to new heights, said Prabhakar. At no time did the company lay off any employee or reduce salaries, he said.

“It is very satisfying as we have more than quadrupled our revenue in 2020 to date, and raised funds for expansion even during the tough economic climate. This further strengthens our belief that we have built a globally scalable, sound business that is not only trusted by large brands, but also the investor community,” he said.

TechCrunch asked Prabhakar if he would ever consider engaging with customers directly. He said the current model of Servify enables it to acquire customers at no charge and he thinks it’s the right model to maintain moving forward.

Prabhakar said he is hopeful that more venture firms will look into this new category, which traditionally does not receive much attention because it did not fit into existing spaces such as SaaS. He said Servify has proven that this category is crucial and thriving.

Categories: Business News

Uncapped picks up another $26M to offer revenue-based finance to European entrepreneurs

2020, September 23 - 4:00pm

Uncapped, the London-headquartered and Warsaw-based startup that offers “revenue-based” finance to European businesses so that founders don’t have to give up equity stipulated by venture capital, has raised $26 million in new funding.

The round was led by Mouro Capital (the recently spun-out fund previously called Santander InnoVentures), with participation from existing investors Global Founders Capital, Seedcamp, Iron Ventures and White Star Capital. Various angel investors have also backed Uncapped, including Taavet Hinrikus (TransferWise), Christian Faes (LendInvest), David Nolan & Kevin Glynn (Butternut Box) and Carlos Gonzalez-Cadenas (GoCardless).

Founded last year by “serial entrepreneur” Asher Ismail (who was most recently CEO of Midrive) and former VC Piotr Pisarz, Uncapped has set out to use various marketing, sales and accounting data to be able to offer finance for young businesses based on their current (and projected) revenue. It was born out of the pair’s own frustrations with the limited funding options available to European entrepreneurs, namely equity-based or traditional debt financing.

Framed as a third option, Uncapped provides what it terms “growth finance” in return for a flat fee as low as 6%. Businesses only repay the capital as they generate revenue, “with no set repayment date and no compounding interest, equity or personal guarantees”.

It was originally pitched as being particularly suited to revenue-generating companies wishing to invest in online marketing to grow sales more quickly, but has since widened its target to other scenarios.

“When we launched, we knew selling equity to buy Facebook and Google ads was a bad deal for founders,” says Ismail. “So this is where we focused and mainly funded companies for advertising and inventory. Since then we’ve set out to help companies get funding for any purpose including launching a new product, expanding internationally, or growing the team”.

Post-launch and through refining its technology, Uncapped has sped up the time it takes to make a lending decision from three days to a few hours. Once financing has been agreed, the startup can also now issue Visa cards so founders can start spending funds immediately.

“With this new investment round, we’ve also started funding earlier-stage companies with only six months of revenue history (previously our minimum was nine months),” says Ismail. “We’ve also doubled the amount we can advance at one time to £2 million. So now more companies can access funding for more use cases, and faster”.

Asked how the coronavirus pandemic has affected the way Uncapped evaluates risk, where past revenue performance may not be a reliable indicator going forward, Pisarz says a recession in some ways is the best time to build a credit model, “as everyone else’s models are now irrelevant”.

“Whereas other online lenders depend on personal guarantees and the founder’s own credit history as the main drivers of their risk models, we use live data about the company’s actual trading to make our decisions,” he tells me. “When the pandemic hit, we were able to access the real-time data about how our portfolio was performing, make quick decisions and continue to issue credit, where others were forced to pull back. Our number of investments and the returns have since grown exponentially”.

To boot, Pisarz says Uncapped has continued to upgrade its underwriting technology, and having now seen how different business models adjust to more challenging times, it has built more confidence in its underwriting.

“Unlike a VC, we need our whole portfolio to succeed, not just a few that make up for the losses of the others. So we need to have a lot of certainty in our decision making,” he concedes.

“Equity was the most expensive way to fund digital ad spend and repeatable growth, and as fundraising has become even harder due to the pandemic, it has only become more expensive,” adds Ismail. “So our sweet spot continues to be direct-to-consumer products and other fast-monetising startups that generate between £10,000-£2 million of monthly sales, have healthy unit economics and want to avoid diluting their founders and existing investors.

“For businesses that are still in the R&D stage or need more time to get to market, venture is still a good solution, but for businesses who are already live, have predictable customer acquisition costs, and repeatable growth, we know we are a better option”.

Categories: Business News

Singapore-based Syfe, a robo-advisor with a human touch, raises $18.6 million led by Valar Ventures

2020, September 23 - 11:00am

Dhruv Arora, the founder and CEO of Singapore-based investment platform Syfe

Syfe, a Singapore-based startup that wants to make investing more accessible in Asia, announced today that it has closed a SGD $25.2 million (USD $18.6 million) Series A led by Valar Ventures, a fintech-focused investment firm.

The round also included participation from Presight Capital and returning investor Unbound, which led Syfe’s seed funding last year.

Founded in 2017 by chief executive officer Dhruv Arora, Syfe launched in July 2019. Like “robo-advisors” Robinhood, Acorns and Stash, Syfe’s goal is to make investing more accessible. There is no minimum amount required to start investing and its all-inclusive pricing structure ranges from .4% to .65% per year.

Syfe serves customers based in 23 countries, but currently only actively markets it services in Singapore, where it is licensed under the Monetary Authority of Singapore. Part of its new funding will be used to expand into new Asian countries. The startup hasn’t disclosed its exact user numbers, but says the number of its customers and assets under management have increased tenfold since the beginning of the year, and almost half of its new clients were referred by existing users.

Other Valar Ventures portfolio companies include TransferWise, Xero and digital bank N26. In a statement about Syfe, founding partner Andrew McCormack said, “The potential of Asia as a region, with a fast-growing number of mass-affluent consumers aiming to grow their wealth, combined with the pedigree of the team and strong traction, makes Syfe a very compelling opportunity.”

Before starting Syfe, Arora was an investment banker at UBS Investment Bank in Hong Kong before serving as vice president of product and growth at Grofers, one of India’s largest online grocery delivery services. While at UBS, Arora worked with exchange-traded funds, or ETFs.

“I could see how a lot of institutions and some ultra-high-net worth individuals who are clients of the bank were using the product, and I thought it was a great tool for individuals, too,” Arora told TechCrunch. “But what I realized was that people are actually not very aware of how to use ETFs.”

In many Asian countries, people prefer to put their money away in bank accounts or invest in real estate. As interest rates and property prices stagnate, however, consumers are looking for other ways to invest. Syfe currently offers three investment products. The first is a global diversified portfolio with a mix of stocks, bonds and ETFs that is automatically managed according to each investor’s chosen risk level. The second is a REIT portfolio based on the Singapore Exchange’s iEdge S-REIT Leaders Index. Finally, Syfe’s Equity100 portfolio consists of ETFs that include stocks from more than 1,500 companies around the world.

Other Asia-focused “robo-advisor” services include Stashaway and Kristal.ai, and Grab Financial also recently announced a “micro-investment” product. Arora acknowledges that in the future, there may be more entrants to the space. Right now, however, Syfe’s main competitor is the mindset that banks are still the best way to save money, he added. Part of Syfe’s work is consumer education, because “it was culturally ingrained in a lot of us, myself included, to keep your money in the bank.”

Syfe differentiates with a team of financial advisors, including former employees of Goldman Sachs, Citibank and Morgan Stanley, who are on hand for user consultations. Arora said most Syfe users talk to advisors when they first join the platform, and about 20% of them continue using the service. Questions have included if people should use a credit card to invest, which Arora said advisors dissuade them from doing because of high interest rates.

“We definitely want to be a tech-first platform, but we understand there is a value, especially as you deal with some of the older audiences who are in their 50s and 60s, who are still adapting to these technologies,” he said. “They need to know that you know there is somebody out there to look after their products.”

While Syfe’s average user is aged between 30 to 45, one growing bracket is people in their 50s who are motivated to save for retirement, or want to create a supplement to their pension plan. Users typically start with an initial investment of about SGD $10,000 (about USD $7,340), and about four out of five users regularly top up that amount.

Some users have tried other investment products, like investment-linked insurance plans, but for many, Arora says Syfe is their first introduction to investing in stocks, bonds and ETFs.

“We’ve realized that a fair number of them are quite well-to-do professionals in their field, in their mid- to late 30s, who amassed a significant amount of wealth but never really had a chance to invest, or the right advice on how to invest,” said Arora. “I think this has been one of the biggest revelations for us and it made us realize we should have a human touch in our platform.”

The platform manages its products with a mix of an investment team and algorithms that help avoid human bias, said Arora. Syfe’s algorithms take into account growth versus value, the market cap of a stock, volatility and sector momentum. To balance risk, it also analyzes how individual assets correlate with other assets in the same portfolio.

Arora said Syfe is currently in advanced talks with regulators in several countries and expects to be in at least two new markets by the end of next year. It also plans to double the size of its team and create more consumer financial products.

During COVID-19, Arora said Syfe’s portfolios experienced significantly lower corrections than indexes like the S&P, so only a few users withdrew their money. In fact, many invested more.

“I feel people have been rethinking their finances and the future,” he said. “As banks cut interest rates across the world, including in Singapore, many of them have started looking at other options.”

Categories: Business News

TransferWise reports accelerating revenue growth to 70% in its March, 2020 fiscal year

2020, September 23 - 8:01am

TransferWise, a European fintech unicorn, announced the financial results of its fiscal year ending March, 2020.

The company posted strong growth, continued profit and new customer records. TransferWise was most recently valued at $5 billion during a secondary sale worth $319 million in July of this year.

On the results front, we can compare the company’s March 2020 year to its March 2019 year, the results of which we also have available. Here are the nuts and bolts, picking from the provided metrics to share the most material:

  • TransferWise fiscal 2020 revenue: £302.6 million, up 70% from its fiscal 2019 result of £179 million. That’s a venture-level revenue result from a mature company that is self-powering.
  • TransferWise grew more quickly in its March 2020 year than in its March 2019 year, when it managed a slower 53% growth rate per the company. Accelerating revenue growth at this scale is very valuable.
  • TransferWise managed a fourth year of consecutive profitability, generating £21.3 million in “net profit after tax” for the March 2020 fiscal year. The company first started generating profit “since 2017” per its own release, which we presume means the year ending March 2017.
  • The company reported that it now has 8 million worldwide customers, up from 6 million in the preceding fiscal year. That’s 33% growth.
  • The pace at which business customers sign up for TransferWise appeared to include slower growth, moving from 10,000 per month in the March 2019 year to “over 10,000” in its most recent release.
  • TransferWise processed £42 billion in “cross currency transfers,” or around 63% of its total processing volume of £67 billion.

Instead of merely shouting at this point that TransferWise should go public, as it is providing granular data on its performance we’re already somewhat sated. More notes on gross margins would be good, for example, but this level of transparency is still welcome.

Turning to future growth, TransferWise stated in a release that APAC is the company’s “fastest growing region.” Its U.S. business was worth around a fourth of its March 2020 year’s revenue. Europe was just over half for the same period.

The company’s ability to pay for its own growth means that it has not raised money for some time. Indeed, the last equity round that we have on the company is its November, 2017 investment. That capital was $280 million raised at a $1.3 billion pre-money valuation in a deal led by Merian Global Investors and IVP. Since then the company has sold secondary shares from time to time.

That should lessen internal demands for a traditional liquidity event, but not quash them altogether. The unavoidable question is why not go public when the firm already reports so much public performance data. On the other hand, when a company needs no capital, it need not accept advice, either.

Regardless, TransferWise shows that fintech can make money after all.

Categories: Business News

Papa raises $18 million to expand its business connecting older adults with virtual and in-person companions

2020, September 23 - 6:45am

The Miami-based startup Papa has raised an additional $18 million as it looks to expand its business connecting elderly Americans and families with physical and virtual companions, which the company calls “pals.”

The company’s services are already available in 17 states and Papa is going to expand to another four states in the next few months, according to chief executive Andrew Parker.

Parker launched the business after reaching out on Facebook to find someone who could serve as a pal for his own grandfather in Florida.

After realizing that there was a need among elderly residents across the state for companionship and assistance that differed from the kind of in-person care that would typically be provided by a caregiver, Parker launched the service. The kinds of companionship Papa’s employees offer range from helping with everyday tasks — including transportation, light household chores, advising with health benefits and doctor’s appointments, and grocery delivery — to just conversation.

With the social isolation brought on by responses to the COVID-19 pandemic there are even more reasons for the company’s service, Parker said. Roughly half of adults consider themselves lonely, and social isolation increases the risk of death by 29%, according to statistics provided by the company.

“We created Papa with the singular goal of supporting older adults and their families throughout the aging journey,” said Parker, in a statement. “The COVID-19 pandemic has unfortunately only intensified circumstances leading to loneliness and isolation, and we’re honored to be able to offer solutions to help families during this difficult time.” 

Papa’s pals go through a stringent vetting process, according to Parker, and only about 8% of all applicants become pals.

These pals get paid an hourly rate of around $15 per hour and have the opportunity to receive bonuses and other incentives, and are now available for virtual and in-person sessions with the older adults they’re matched with.

“We have about 20,000 potential Papa pals apply a month,” said Parker. In the company’s early days it only accepted college students to work as pals, but now the company is accepting a broader range of potential employees, with assistants ranging from 18 to 45 years old. The average age, Parker said, is 29.

Papa monitors and manages all virtual interactions between the company’s employees and their charges, flagging issues that may be raised in discussions, like depression and potential problems getting access to food or medications. The monitoring is designed to ensure that meal plans, therapists or medication can be made available to the company’s charges, said Parker.

Now that there’s $18 million more in financing for the company to work with, thanks to new lead investor Comcast Ventures and other backers — including Canaan, Initialized Capital, Sound Ventures, Pivotal Ventures, the founders of Flatiron Health and their investment group Operator Partners, along with Behance founder, Scott Belsky — Papa is focused on developing new products and expanding the scope of its services.

The company has raised $31 million to date and expects to be operating in all 50 states by January 2021. The company’s companion services are available to members through health plans and as an employer benefit.

“Papa is enabling a growing number of older Americans to age at home, while reducing the cost of care for health plans and creating meaningful jobs for companion care professionals,” said Fatima Husain, principal at Comcast Ventures, in a statement. “

Categories: Business News

Tech must radically rethink how it treats independent contractors

2020, September 23 - 3:21am
Adam Jackson Contributor Share on Twitter Adam Jackson is the CEO of Braintrust, the first user-controlled talent network that connects organizations with world-class tech talent. He also co-founded telemedicine company Doctor On Demand and blockchain-focused digital asset management company Cambrian Asset Management.

Despite a surging stock market and many major tech players having record quarters, we’re still seeing layoffs throughout tech and the rest of corporate America. Salesforce recorded a huge quarter, passing $5 billion in revenue, only to lay off around 1000 people. LinkedIn is laying off 960 people one day after reporting a 10% increase in revenue.

These layoffs may seem like a contraction in size for these huge enterprises, but it’s actually the beginning of something I call The Great Unbundling of Corporate America. They still need to grow, they still need to innovate, they still need to get work done and they’re not simply canceling projects and giving up on contracts.

Just as COVID-19 has accelerated the move to remote work, our current crisis has accelerated the trend toward hiring independent contractors. Back in 2019 a New York Times report found that Google had a shadow workforce of 121,000 temporary workers and contractors, overshadowing their 102,000 full-timers. ZipRecruiter reported in 2018 that tech, along with its record employment growth, was showing an increasing share of listings for independent contractors.

A study from the Bureau of Labor Statistics found that between 6.9% and 9.6% of all workers are now independent contractors, and according to Upwork, that may be as high as 35%. Mark my words — companies are using this time as an opportunity to swing the pendulum toward independent contractors and trimming the fat, justifying it with a vague gesture toward “an unprecedented time.”

That’s why, in my opinion, you’re seeing the NASDAQ hitting record highs despite everyone’s turmoil — depressingly, investors can see that large companies are tightening up and cleaning up waste, while finding an affordable workforce at will. As they have unbundled themselves from our physical offices, large enterprises are going to unbundle themselves from having to have a set number of employees.

When Square allowed its entire workforce to work remotely permanently. It wasn’t just because they wanted them to feel more creative and productive, but was likely a move away from having quite as much expensive, needless office space.

Similarly, if there is work that a full-time employee does that could be done by a flexible, independent contractor, why not make that change too? And it’ll be a lot easier to make without as many people at the office.

The argument I’m making is not anti-contractor, though.

I can’t think of any point in history where it’s been better to create a freelance business — the startup costs are significantly lower, and as companies move toward remote work, you can theoretically take business nationally (or internationally) like never before. Companies’ moves toward replacing W-2 workers with contractors is an opportunity for people to create their own miniature freelance empires, unbundling themselves from corporate America’s required hours, and potentially creating a way to weather future storms by taking away any single company’s leverage on their income.

The rush to remote work is also likely to push more workers into the freelance economy too. By having to create a remote office, with a remote presence in meetings and having to manage and organize our days, the average worker has all but adjusted to the life of a freelancer.

Where some might have gone to an office and had things simply happen to them, the remote world requires an attention to your calendar and active outreach to colleagues that, well, models how one might run a freelance business. Those with core skillsets that can be marketed and sold to multiple clients should be thinking about whether being a wage slave is necessary anymore, and with good reason.

That said — corporate America, and especially tech, has to treat this essential workforce with a great deal more empathy and respect than they have thus far.

Uber and Lyft were ordered to treat drivers as employees in part due to the fact that they never treated their contractors like parts of the company. Other than the obvious lack of benefits (paid time off, health insurance, etc.), Uber, like many large enterprises, treats contractors as disposable rather than flexible, despite them being the literal driving force of the company. When Uber went public, they gave a nominal bonus for drivers that had completed 2500 to 40,000 trips, with a chance to buy up to $10,000 of stock — at the IPO price. These drivers, that had been the very reason that many people became millionaires and billionaires when Uber went public, were given the chance to maybe make money, if they sold the stock quickly enough.

It’s an abject lesson on how to not build loyalty with independent contractors. It’s also a lesson on what the next big company that wants to build themselves off the back of the 1099’er should do.

What I’m suggesting is a radical rethinking of freelance contracting. I want you to see independent contractors as a different kind of worker, not as a way of skirting getting a full-time employee. A freelancer, by definition, is someone that you don’t monopolize, and someone that you should actively give agency and, indeed, part of the network you’re building. One of the issues of corporate America’s approach to freelance work is an us-versus-them approach to employment — you’re either part of us or you’re simply a thing we pick up and put down. What I’m suggesting is treating your freelancers as an essential part of your strategy, and compensating them as such. Freelancers should own equity and should have skin in the game — they may be working with you on a number of projects and take literal ownership of vast successes throughout your history.

Contracted work has only become mercenary through the treatment of the freelance worker. Where tech has succeeded in creating hundreds of thousands of independent contractor positions, it also has to lead the way in reimagining how we may treat them and reward them for their work. And corporate America needs to take a step beyond simply seeing them as a cheaper, easier way to do business. They’re so much more.

Categories: Business News

Despite a rough year for digital media, Blavity and The Shade Room are thriving

2020, September 23 - 3:03am

Last week at TechCrunch Disrupt, TechCrunch media and advertising reporter Anthony Ha sat down with Blavity CEO Morgan DeBaun and The Shade Room CEO Angelica Nwandu to chat about their respective media companies, 2020 in the media world and how they view a recent conversation inside of media to hire and retain more diverse workforces.

Blavity is a network of online publications focused on Black audiences across verticals like politics, travel and technology. To date, the company has raised $9.4 million, according to Crunchbase data.

The Shade Room is an Instagram-focused media company that publishes hourly updates on national news, celebrity updates and fashion. Focused on the Black perspective, The Shade Room has attracted more than 20 million followers on Instagram and comments on issues of importance during key national moments.

During her conversation with Ha, Nwandu said that during the Black Lives Matters protests, The Shade Room was akin to a Black CNN.

With both companies founded in 2014, both CEOs have kept their media startups alive during a particularly difficult period. In the last six years, many media brands have shuttered, sold, slimmed or slunk away to the ash heap of history.

Categories: Business News

Mirakl raises $300 million for its marketplace platform

2020, September 23 - 2:00am

French startup Mirakl has raised a $300 million funding round at a $1.5 billion valuation — the company is now a unicorn. Mirakl helps you launch and manage a marketplace on your e-commerce website. Many customers also rely on Mirakl-powered marketplaces for B2B transactions.

Permira Advisers is leading the round, with existing investors 83North, Bain Capital Ventures, Elaia Partners and Felix Capital also participating.

“We’ve closed this round in 43 days,” co-founder and U.S. CEO Adrien Nussenbaum told me. But the due diligence process has been intense. “[Permira Advisers] made 250 calls to clients, leads, partners and former employees.”

Many e-commerce companies rely on third-party sellers to increase their offering. Instead of having one seller selling to many customers, marketplaces let you sell products from many sellers to many customers. Mirakl has built a solution to manage the marketplace of your e-commerce platform.

300 companies have been working with Mirakl for their marketplace, such as Best Buy Canada, Carrefour, Darty and Office Depot. More recently, Mirakl has been increasingly working with B2B clients as well.

These industry-specific marketplaces can be used for procurement or bulk selling of parts. In this category, clients include Airbus Helicopters, Toyota Material Handling and Accor’s Astore. 60% of Mirakl’s marketplace are still consumer-facing marketplaces, but the company is adding as many B2B and B2C marketplaces these days.

“We’ve developed a lot of features that enable platform business models that go further than simple marketplaces,” co-founder and CEO Philippe Corrot told me. “For instance, we’ve invested in services — it lets our clients develop service platforms.”

In France, Conforama can upsell customers with different services when they buy some furniture for instance. Mirakl has also launched its own catalog manager so that you can merge listings, add information, etc.

The company is using artificial intelligence to do the heavy-lifting on this front. There are other AI-enabled features, such as fraud detection.

Given that Mirakl is a marketplace expert, it’s not surprising that the company has also created a sort of marketplace of marketplaces with Mirakl Connect.

“Mirakl Connect is a platform that is going to be the single entry point for everybody in the marketplace ecosystem, from sellers to operators and partners,” Corrot said.

For sellers, it’s quite obvious. You can create a company profile and promote products on multiple marketplaces at once. But the company is also starting to work with payment service providers, fulfillment companies, feed aggregators and other partners. The company wants to become a one-stop shop on marketplaces with those partners.

Overall, Mirakl-powered marketplaces have generated $1.2 billion in gross merchandise volume (GMV) during the first half of 2020. It represents a 111% year-over-year increase, despite the economic crisis.

With today’s funding round, the company plans to expand across all areas — same features, same business model, but with more resources. It plans to hire 500 engineers and scale its sales and customer success teams.

Categories: Business News

Introducing the Expo Pass for TC Sessions: Mobility 2020

2020, September 23 - 12:41am

Don’t let budget woes keep you from participating in TC Sessions: Mobility 2020 on October 6-7. We’re dedicated to making this event accessible to as many members of the mobility community as possible. Case in point: Today we’re announcing the new Expo Ticket for just $25.

Pro tip: Get your Expo ticket today. The price jumps to $50 once the conference begins on October 6.

What can you do with an Expo ticket? The short answer is plenty. You’ll have access to all the Mobility 2020 breakout sessions, which take a deeper dive into specific topics. We’ll be announcing those breakout sessions soon. Watch for our announcement, and be sure to check out the Mobility 2020 agenda.

I learned a lot from the breakout sessions. An official from the Los Angeles Department of Transportation spoke about the city’s plan to build pathways for micromobility vehicles. Access to experts sharing that kind of information is essential for anyone launching a micromobility startup. — Parug Demircioglu, CEO at Invemo and partner at Nito Bikes.

Plus, you can explore 40+ startups — both early stage and more established companies — exhibiting during the conference. Think of “Expo” as an alternative way to spell “opportunity.” Connect with the exhibiting founders, hear their product stories and watch their demos. You might find your next customer, partner, investment or employer.

We’ve got your back in the networking department with CrunchMatch. Our AI-powered platform helps you find and connect with the people who align with your business goals. Answer a few simple questions when you register and CrunchMatch will be ready to do the heavy lifting for you. Peruse the offerings and schedule 1:1 video calls with the folks who can help you take your startup dream to the next level. It’s the perfect tool to help organize and simplify your expo exploration.

CrunchMatch, which is basically speed-dating for techies, was very helpful. I scheduled at least 10 short, precise meetings. I learned about startups in stealth mode, what big corporations were up to — things not yet picked up by the press. It was great, and I followed up on three or four of those connections. — Jens Lehmann, technical lead and product manager, SAP.

Join mobility’s brightest minds, makers and investors at TC Sessions: Mobility 2020 on October 6-7. Set aside your budget concerns and buy an opportunity-packed Expo Pass — before October 6 — for just $25. We can’t wait to “see” you there!

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

Event discovery network IRL raises $16M Series B after refocusing on virtual events

2020, September 23 - 12:28am

The COVID-19 pandemic impacted the way a number of companies have had to do business. For the event discovery startup, IRL, it meant pivoting into the virtual events space. This April, the startup quickly reacted to government lockdowns and restrictions on in-person gatherings to focus on helping people find their online counterparts and other virtual events, like live-streamed concerts, Zoom parties, esports tournaments and more. Today, those efforts are paying off as IRL announces $16 million in Series B funding and the expansion of its social calendaring app to colleges.

The new round was led by Goodwater Capital with participation from Founders Fund, Floodgate and Raine, and comes on top of the $11 million IRL had previously raised, including its $8 million Series A last year.

The coronavirus pandemic, surprisingly, may have made IRL relevant to a wider audience. Before, IRL was mostly useful to those who lived in areas where there were a lot of events to attend, or who could afford to travel. But with the refocusing on “remote life” instead of “real life,” more people could launch the app to find something interesting to do — even if it was only online.

In fitting with its new focus, IRL redesigned its app earlier this year to create a new home screen experience where users could discover events they could attend remotely. This design continues to be tweaked, and now features a colorful “discover” tab in the app where you can tap into various event categories, like gaming, music, tv, wellness, sports, podcasts, lifestyle and more, including those sourced from partners like TikTok, Meetup, Twitch, Spotify, SoundCloud, HBO, Ticketmaster, Eventbrite and others.

There are also dedicated sections for events you’re following and a curated Top Picks. The IRL in-app calendar, meanwhile, lets you easily see what’s happening today and in the weeks and months ahead.

Since its refocusing on virtual events, IRL has brought people together for online happenings like Burning Man’s Multiverse and TikTok Live’s The Weekend Experience, for example.

According to TikTok, IRL had helped it gauge early interest in its The Weekend Experience event, with some 52,000 IRL RSVPs and 1.1 million followers on its IRL profile.

Image Credits: IRL screenshot via TechCrunch

“IRL has been an amazing platform for us to engage with more of our audience and meet new potential users,” said Jenny Zhu, head of Integrated Marketing U.S. at TikTok. She also added that TikTok sees “major traffic coming from IRL” and is “excited to continue our partnership.”

In terms of growth, IRL claims its users are now tracking over 1 million hours per day spent in “Time Together” — a metric that tabulates the number of hours users are spending together at the events they RSVP’d to, virtual or otherwise. In addition, IRL says it has seen 10x growth in daily active users and a total of 300 million “Time Together” hours since last June. It also claims 5.5 million MAUs.

While IRL doesn’t share its download figures, app store intelligence firm Sensor Tower estimates the app has seen a total of 7.7 million installs across iOS and Android.

With the additional capital, IRL is expanding with the launch of a college network.

Its goal is to improve upon the Facebook experience for the younger, student demographic by helping college users find, share and attend academic and social events, both physical and virtual. However, just this month Facebook launched its own college network, Facebook Campus, which allows students to privately network and track student events on the Facebook platform, outside of their main Facebook profile.

IRL says it’s starting its college network with 100 colleges and universities across North America, including Harvard, Columbia and NYU. Facebook Campus, meanwhile, launched with 30 schools.

“IRL is the only social platform that helps users find the best ways to spend their time and actually encourages them to get off the platform,” said IRL founder and CEO Abraham Shafi about the launch of the new network. “Colleges and universities, in particular, need a way to build and foster a sense of community, whether their students are away from campus remote learning or on campus practicing hybrid learning,” he explained.

For IRL’s investor, Chi-Hua Chien, a managing partner at Goodwater Capital, the potential in IRL is its focus on real connections and community building.

“We believe IRL will grow to become one of the major social networks powering communities on the internet and in the real world,” Chien said. “IRL delivers on the promise to make social media less isolating, by helping drive authentic connection between friends and family around events they care about,” he added.

 

Categories: Business News

Mailchimp launches new AI tools as it continues its transformation to marketing platform

2020, September 23 - 12:10am

Mailchimp may have started out as an easy to use newsletter tool, but that was almost 20 years ago. Today’s company still does email, but at its core, it is now a marketing automation platform for small businesses that also offers a website builder, basic online stores, digital ad support and analytics to make sense of it all. Like before, though, the company’s main goal is to make all these features easy to use for small business users.

Image Credits: Mailchimp

Today, Mailchimp, which has never taken outside funding, is taking the next step in its own transformation with the launch of a set of AI-based tools that give small businesses easy access to the same kind of capabilities that their larger competitors now use. That includes personalized product recommendations for shoppers and forecasting tools for behavioral targeting to see which users are most likely to buy something, for example. But there’s now also a new AI-backed tool to help business owners design their own visual asset (based in part on its acquisition of Sawa), as well as a tool to help them write better email subject lines.

There’s also a new tool that helps businesses choose the next best action. It looks at all of the data the service aggregates and gives users actionable recommendations for how to improve their email campaign performance.

Image Credits: Mailchimp

“The journey to get here started about four years ago,” Mailchimp’s founding CEO Ben Chestnut told me. “We were riding high. Email was doing amazing for us. And things look so good. And I had a choice, I felt I could sell the business and make a lot of money. I had some offers. Or I could just coast, honestly. I could just be a hero in email and keep it simple and just keep raking in the money. Or I could take on another really tough challenge, which would be act two of  Mailchimp. And I honestly didn’t know what that would be. To be honest with you, that was four years ago, it could have been anything really.”

But after talking to the team, including John Foreman, the head of data analytics at the time and now Mailchimp’s CPO, Chestnut put the company on this new path to go after the marketing automation space. In part, he told me, he did so because he noted that the email space was getting increasingly crowded. “You know how that ends. I mean, you can’t stay there forever with this many competitors. So I knew that we had to up our game,” he said.

And that meant going well beyond email and building numerous new products.

Image Credits: Mailchimp

“It was a huge transformation for us,” Chestnut acknowledged. “We had to get good at building for other customer segments at the time, like e-commerce customers and others. And that was new for us, too. It’s all kinds of new disciplines for us. To inflict that kind of change on your employees is very, very rough. I just can’t help but look back with gratitude that my employees were willing to go on this journey with me. And they actually had faith in me and this release — this fall release — is really the culmination of everything we’ve been working on for four years to me.”

One thing that helped was that Mailchimp already had e-commerce customers — and as Chestnut noted, they were pushing the system to its limit. Only a few years ago, the culture at Mailchimp looked at them as somewhat annoying, though, Chestnut admitted, because they were quite demanding. They didn’t even make the company a lot of money either. At the time, non-profits were Mailchimp’s best customers, but they weren’t pushing the technology to its limits.

Before breaking up with Shopify, Mailchimp quietly acqui-hired LemonStand, a Shopify competitor

Despite this transformation, Mailchimp hasn’t made a lot of acquisitions to accelerate this process. Chestnut argues that a lot of what it is doing — say adding direct mail — is something that was more or less and extension of what it was already good at. But it did make some small AI and ML acquisitions to bring the right expertise in-house, as well as two e-commerce acquisitions, including Lemonstand. Most recently, Mailchimp acquired Courier, a British magazine, newsletter and podcast, marking its first move into the print business.

With this new set of products and services, Mailchimp is now aiming to give small businesses access to the same capabilities the larger e-commerce players have long had, but without the complexity.

To build tools based on machine learning, one needs data — and that’s something Mailchimp already had.

“We’ve been doing marketing for decades,” Mailchimp CPO Foreman said. “And we have millions of small businesses on the platform. And so not only do we build all these tools ourselves, which allows us to integrate them from a visual design perspective — they’re not necessarily acquisitions — but we have this common data set from years and years of doing marketing across millions of businesses, billions of customers we’re talking to, and so we thought, how can we use intelligence — artificial intelligence, machine learning, etc. — to also sand down how all of these tools connect.”

Chestnut says he isn’t likely to put the company on a similar transformation anytime soon. “I really believe you can only take on one major transformation per decade,” he said. “And so you better pick the right one and you better invest it. We’re all in on this all-in-one marketing platform that’s e-commerce enabled. That is unique enough. And now what I’m trying to get my company to do is go deep.”

Categories: Business News

Join Accel’s Andrew Braccia and Sonali De Rycker for a live Q&A right now

2020, September 22 - 11:48pm

Disrupt was just days ago, but the TechCrunch crew is continuing our regular series of public chats with leading founders and venture capitalists under the Extra Crunch Live banner.

Today, we’re excited to host Andrew Braccia and Sonali De Rycker from Accel. The pair of investors will join us for a live Q&A at 2 p.m. EDT time today (11 a.m. PDT, 8 p.m. CET). Links and details are down below.

As discussed last week when we announced the session, there’s a lot to get to. Braccia led Slack’s Series A, which means we’ll need to discuss remote work, the direct listing debate and modern SaaS stuff. And with De Rycker we’ll dig into what she’s seeing in Europe and how the two startup markets compare in today’s evolving markets.

(If you are just catching up to Extra Crunch Live, we’ve been hosting live discussions since the early COVID-19 days here in the United States with folks like Mark CubanPlaid founder Zach Perret and Sequoia’s Roelof Botha taking part.)

I’ve also been thinking about India (Accel raised a fifth India fund in 2019), which will be worth talking about a little bit even if neither of our guests primarily focuses on the country. And if we have time, it would even be good to get their feelings and reactions to the TikTok mess.

But, before we get into the more exotic areas of conversation we’ll power through the nuts-and-bolts stuff that founders want to know: How active Accel is today, what size checks it is currently writing, its sector focuses and the like. Given that we have a full hour if we want it, we’ll be able to cover a lot of ground.

Be sure to bring your own questions, and I’ll do my best to get to them as we chat.

It should prove to be a good, and, I hope, useful conversation that I am looking forward to hosting. Login details follow for Extra Crunch folks, and you can snag a cheap trial here if you need access.

(If you want to pre-submit a question, you can tweet it at me, but after the actual livestream kicks off I will no longer be checking Twitter. Get them in now, in other words.)

Details
Categories: Business News

How has Corsair Gaming posted such impressive pre-IPO numbers?

2020, September 22 - 11:36pm

After the last few weeks of IPOs, you’d be forgiven if you missed Corsair Gaming’s own public offering.

The company is not our usual fare. Here at TechCrunch, we care a lot of about startups, usually technology startups, which often collect capital from private sources on their way to either the bin, an IPO or a buyout.

Corsair is some of those things. It is a private company that builds technology products and it has raised some money while private. But from there it’s a slim list. The company was founded in 1994, making it more a mature business than a startup. And it sold a majority of itself to a private equity group in 2017, valued at $525 million at the time.

The Exchange explores startups, markets and money. Read it every morning on Extra Crunch, or get The Exchange newsletter every Saturday.

Fair enough. But flipping through the company’s S-1 filings this morning over coffee, I was impressed all the same and want to walk you through a few of the company’s numbers.

If you care about the impending public debuts of Asana (more here) and Palantir (more here) that we expect next week, Corsair will not provide much directional guidance. But its IPO will be a fascinating debut all the same.

Corsair has managed to stay in the gaming hardware world since I was in short pants, and, even better, has managed to turn the streaming boom into material profit. Its S-1 is an interesting document to read. So let’s get into it, because Corsair Gaming is expected to price later today and trade tomorrow morning.

A gaming giant

As with any private-equity-backed IPO, the company’s SEC filings are a mess of predecessor and successor companies, along with long sections that, once you boil them down, ensure that the private equity firm will retain control.

But once you parse the firm’s numbers, here’s the gist from the first six months of 2020:

Categories: Business News

Latch, a smart lock company, looks to become a platform with the launch of LatchOS

2020, September 22 - 11:00pm

Tech that powers physical spaces is in the midst of a growth spurt. One company in the mix, Latch, is today announcing the next phase of the company with the launch of LatchOS.

Latch was founded back in 2014 with the mission of creating a vertically integrated hardware/software solution for door access in apartment buildings. Unlike some smart home locks that replace the lock on the door, Latch looked at the different locks that exist in apartment buildings and created solutions that work with each.

This allows building managers and apartment renters/owners to manage their doors and who has access, including the maintenance staff, deliveries, etc.

With the launch of LatchOS, the company is getting even deeper into the buildings, giving users the ability to manage more than just the door but integrate the app with other devices in a building. These integrations include Sonos speakers, Honeywell and ecobee thermostats and Jaso and Leviton light switches, all from their Latch app.

This is just the start. LatchOS was built to become the backbone of the platform, allowing more integrations to be implemented or built out based on the needs of the buildings and users.

Though the company has flown somewhat under the radar, it’s raised more than $150 million and says it did more than $100 million in sales in 2019, with one of every 10 buildings in the United States being built with Latch products.

Latch makes money by selling hardware to building owners and then charging a monthly software fee, allowing the service to be free to renters and apartment owners. With the launch of LatchOS, the company can now build out integrations to earn revenue off of end users, as well, should they choose to upgrade to new features or purchase services through the platform.

The company, helmed by former Apple employees Luke Schoenfelder and Thomas Meyerhoffer, as well as full stack hardware engineer Brian Jones, has more than 230 employees and declined to share any information around the diversity of its staff.

“People have always seen us as a lock company and they wonder why a lock company is doing this other stuff,” said Schoenfelder. The reality is that we’ve never wanted to be a lock company. We just needed to build the locks to make the rest of the system work. That’s why we built our own hardware. We’ve always been focused on building the system that makes the building better for everybody.”

Categories: Business News

EasySend raises $16M from Intel, more for its no-code approach to automating B2C interfaces

2020, September 22 - 10:21pm

No-code and low-code software have become increasingly popular ways for companies — especially those that don’t count technology as part of their DNA — to bring in more updated IT processes without the heavy lifting needed to build and integrate services from the ground up.

As a mark of that trend, today, a company that has taken this approach to speeding up customer experience is announcing some funding. EasySend, an Israeli startup which has built a no-code platform for insurance companies and other regulated businesses to build out forms and other interfaces to take in customer information and subsequently use AI systems to process it more efficiently, is announcing that it has raised $16 million.

The funding has actually come in two tranches, a $5 million seed round from Vertex Ventures and Menora Insurance that it never disclosed, and another $11 million round that closed more recently, led by Hanaco with participation from Intel Capital. The company is already generating revenue, and did so from the start, enough that it was actually bootstrapped for the first three years of its life.

Tal Daskal, EasySend’s CEO and co-founder, said that the funding being announced today will be used to help it expand into more verticals: up to now its primary target has been insurance companies, although organically it’s picked up customers from a number of other verticals, such as telecoms carriers, banks and more.

The plan will be now to hone in on specifically marketing to and building solutions for the financial services sector, as well as hiring and expanding in Asia, Europe and the US.

Longer term, he said, that another area EasySend might like to look at more in the future is robotic process automation (RPA). RPA, and companies that deal in it like UIPath, Automation Anywhere and Blue Prism, is today focused on the back office, and EasySend’s focus on the “front office” integrates with leaders in that area. But over time, it would make sense for EasySend to cover this in a more holistic way, he added.

Menora was a strategic backer: it’s one of the largest insurance providers in Israel, Daskal said, and it used EasySend to build out better ways for consumers to submit data for claims and apply for insurance.

Intel, he said, is also strategic although how is still being worked out: what’s notable to mention here is that Intel has been building out a huge autonomous driving business in Israel, anchored by MobileEye, and not only will insurance (and overall risk management) play a big part in how that business develops, but longer term you can see how there will be a need for a lot of seamless customer interactions (and form filling) between would-be car owners, operators, and passengers in order for services to operate more efficiently.

“Intel Capital chose to invest in EasySend because of its intelligent and impactful approach to accelerating digital transformation to improve customer experiences,” said Nick Washburn, senior managing director, Intel Capital, in a statement. “EasySend’s no-code platform utilizes AI to digitize thousands of forms quickly and easily, reducing development time from months to days, and transforming customer journeys that have been paper-based, inefficient and frustrating. In today’s world, this is more critical than ever before.”

The rise and persistence of Covid-19 globally has had a big, multi-faceted impact how we all do business, and two of those ways have fed directly into the growth of EasySend.

First, the move to remote working has given organizations a giant fillip to work on digital transformation, refreshing and replacing legacy systems with processes that work faster and rely on newer technologies.

Second, consumers have really reassessed their use of insurance services, specifically health and home policies, respectively to make sure they are better equipped in the event of a Covid-19-precipitated scare, and to make sure that they are adequately covered for how they now use their homes all hours of the day.

EasySend’s platform for building and running interfaces for customer experience fall directly into the kinds of apps and services that are being identified and updated, precisely at a time when its initial target customers, insurers, are seeing a surge in business. It’s that “perfect storm” of circumstances that the startup wouldn’t have wished on the world, but which has definitely helped it along.

While there are a lot of companies on the market today that help organizations automate and run their customer interaction processes, the Daskal said that EasySend’s focus on using AI to process information is what makes the startup more unique, as it can be used not just to run things, but to help improve how things work.

It’s not just about taking in character recognition and organizing data, it’s “understanding the business logic,” he said. “We have a lot of data and we can understand [for example] where customers left the process [when filling out forms]. We can give insights into how to increase the conversion rates.”

It’s that balance of providing tools to do business better today, as well as to focus on how to build more business for tomorrow, that has caught the eye of investors.

“Hanaco is firmly invested in building a digital future. By bridging the gap between manual processes and digitization, EasySend is making this not only possible, but also easy, affordable, and practical,” said Hanaco founding partner Alon Lifshitz, in a statement.

Categories: Business News

Morgan Beller, co-creator of the Libra digital currency, just joined the venture firm NFX

2020, September 22 - 10:00pm

Morgan Beller, who is a co-creator of the proposed Libra digital currency, along with Facebook vice presidents David Marcus and Kevin Weil, has left the company to become a general partner with the venture firm NFX .

In a call yesterday, she said she first became acquainted with the San Francisco-based outfit five years ago when on a “tech trek” to Israel, she met its local partner, Gigi Levy-Weiss, and formed a friendship with him.

At the time, she was a young partner at Andreessen Horowitz, working on its deal team after graduating from Cornell as a statistics major.

A role working on corporate development and strategy at Medium would follow, then it was on to Facebook in 2017, where Beller began in corporate development and — intrigued by cryptocurrency tech — where she quickly began evangelizing to her bosses the importance of better understanding it.

As she half-jokingly explains it, “Crypto is a mental virus for which there is no cure. I was at a16z when they got infected with the crypto virus.” She eventually caught it herself, and by the time she joined Facebook, she says she “realized no one was thinking about that space full time, so I took it upon myself to [help the company] figure out its point of view.”

Indeed, a CNBC story about Beller last year reports that at one point, she was the sole person on a Facebook blockchain initiative — meeting with those in the know, attending relevant events and otherwise researching the technology. Bill Barhydt, the CEO of the digital wallet startup Abra, told the outlet of Beller: “I give her a lot of credit for taking what seems like a very methodical, long-term approach to figuring this out.”

All that said, Beller notes that as a full-time investor with NFX, she will not be focused exclusively or even mainly on crypto. Her focus instead will be finding and helping to cultivate seed-stage startups that aim to grow so-called network effects businesses.

It’s the broad theme of NFX, a now 25-person outfit co-founded five years ago by serial entrepreneurs who have all seen their companies acquired, including Levy-Weiss (who co-founded the social casino game publisher Playtika); Pete Flint (founder of the home buyers’ site Trulia and on the founding team of the online travel site Lastminute.com); and James Currier (of the social network Tickle).

Certainly, she will keep busy at the firm, she suggests. As part of better getting to know the partners and their thinking, she introduced them to one company that they have since funded.

The pace has generally picked up, Flint tells us, saying that during the second quarter of this year and the third, NFX has twice broken its own investing records both because of “incredible founders who are reacting to this opportunity” and growing awareness about NFX, which last year closed its second fund with $275 million.

Last month, for example, NFX led a seed round for Warmly, a nine-month-old, San Francisco-based startup whose product tracks individuals in a customer’s CRM system, then sends out a notification when one of his or her contacts changes jobs. It also led a round recently for Jupiter, a year-old, San Francisco-based grocery delivery startup.

Naturally, Beller’s new partners are full of praise for her. Flint says the firm began looking for a fourth partner two years ago and that it has “spoken with dozens of exceptional people” since then, but it “always came back to Morgan.”

As for why the 27-year-old is ready to leap back into VC, Beller says that her work across Facebook and Medium and a16z “made me realize my favorite parts of projects is that zero-to-one phase and that with investing, it’s zero-to-one all day” with a team she wanted to be part of.

Further, she adds, while at Facebook, she was helping scout out deals for the venture firm Spark Capital, so she’s already well-acquainted with the types of founders to which she gravitates. “They’re are all weird in the right ways, and they’re all maniacally obsessed with winning.”

As for how she launches her career as a general partner in a pandemic, she notes that she loves walking and that she’ll happily cover 20 miles a day if given the opportunity.

“If anyone wants to safely walk with me,” she suggests that she’d love it. Says Beller, “I’m not worried about San Francisco longer term. I don’t think there’s a replacement for in-person meetings.”

Categories: Business News

Mark Cuban, Marc Benioff, Robert Downey Jr., Gwyneth Paltrow and Uber CEO Dara Khosrowshahi are investing in toilet paper

2020, September 22 - 9:03pm

A slew of big name entrepreneurs and celebrities are really circling the drain with their latest investment.

Led by Greycroft Partners, a who’s who of celebrity investors, including Mark Cuban, Marc Benioff, Iron Man and Pepper Potts (er… Robert Downey Jr. and Gwyneth Paltrow), Uber’s chief executive Dara Khosrowshahi, Seattle Seahawks quarterback Russell Wilson, Ashton Kutcher and Guy Oseary’s Sound Ventures, and Code.org founder Hadi Partovi are investing $3 million into the new toilet paper brand Cloud Paper. (Grammy Award-winning singer/songwriter Ciara, serial-entrepreneur Grant Ries, Muse Capital, Ashley and Marc Merrill and The Chainsmokers’ Mantis VC are also backing the company)

Why? Because they’re hoping to save the environment.

Founded by Ryan Fritsch and Austin Watkins, two former employees of Khosrowshahi’s at Uber who went on to take roles at the logistics startup Convoy, Cloud Paper is one of several companies trying to get consumers to make the switch to bamboo-based toilet paper. But it may be the only one to get such high-profile investors to flush it with wads of cash.

A year-and-a-half in the making, Cloud Paper began when the two colleagues started talking about launching their own business, but one that could have an immediate impact on the climate crisis they saw as the most pressing societal issue.

Image Credit: Cloud Paper

They settled on toilet paper because of its massive contribution to deforestation, a key contributing factor to climate change. According to statistics provided by the company, 15% of deforestation is due to toilet paper production alone, and roughly 40,000 trees per year are cut down for U.S. consumers to wipe up (with toilet paper and paper towels. The company estimates that an average household could save more than 250 trees by switching to bamboo based toilet paper (ideally theirs).

“We wanted Cloud Paper to be a force for good in the world,” said Watkins. “We wanted to find something similar to taxis and trucking in terms of the size of the market and something that could have a really big impact on the community and the environment from day one.”

To ensure that impact, the company is offsetting twice the amount of carbon emissions that are generated from its business operations and has done so since day one, the founders said.

Currently, the company sells directly to businesses, which were its initial market, and has recently launched a direct to consumer service where its sells its bamboo toilet paper at a cost of $28 for 24 rolls. A price point roughly in line with the industry’s going rate for rolls.

“We have been investing in several companies over the last five to 10 years that have been in this vein,” said Greycroft venture partner Alison Lange Engel. What compelled the firm to back Fritsch and Watkins was the background in logistics and consumer products and the business-to-business focus that the two entrepreneurs initially went to market with, Engel said.

And the selection of bamboo as the source product was no accident. “Bamboo sequester more carbon and releases more oxygen,” said Fritsch. “It’s a magical plant to keep growing and harvesting… especially when the alternative is an old-growth forest.”

Categories: Business News

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