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Marijuana soda startup California Dreamin’ wants to replace booze

2018, March 20 - 7:09am

“Enjoy a light, social high,” says the funky bottle of California Dreamin’ cannabis -infused sparkling pomegranate juice. Launching today at Y Combinator Demo Day, California Dreamin’ is serving up an alcohol alternative that still gets you lit, but without the same hangover or health issues.

Each bottle contains 10 milligrams of THC — an industry-standard dose of the psychoactive chemical in marijuana. The company only uses sativa, the more energizing, euphoric type of pot, compared to the more body-relaxing indica variety. That’s compared to some competing marijuana beverages with as much as 100mg — enough that a single sip will get you high and a bottle will lay out all but the hardiest stoners. “We want it to be a light, head high feel,” says Seven Cities Beverage Company aka California Dreamin’ co-founder Amy Ludlum. “We don’t want to give anyone couch lock. We want it to be social.”

Meanwhile, the taste marries fruity sweetness with a hint of earthy plant life complexity that will titillate long-time cannabis fans. Bottles come in other flavors, like tangerine, grapefruit and cranberry apple, and will retail for about $8 to $10 each. Cases are rolling out to recreational dispensaries in San Francisco, like The Barbary Coast, over the next week.

California Dreamin’ has succeeded in creating a beverage with the light-hearted brand, logical dosage and agreeable taste to be something you can drink casually and socially, not just when you want to get ridiculously high. That makes it a better alternative or complement to drinking alcohol. It’s certainly not for everyone. Paranoia, anxiety and post-high grogginess are all common side-effects of sativa, and you shouldn’t drive while blazed. But there are plenty of people who want an option to unwind that doesn’t involve a literal poison, or smoking a burning plant that can hurt your lungs.

The only problem is that California and other states with legal recreational marijuana ban the sale of anything cannabis related anywhere that serves alcohol. That means you aren’t likely to see California Dreamin’ in a bar any time soon, but you could throw a pretty fun backyard barbecue. But with 1 million medical marijuana users out of 28 million California adults, and with over half of the voting population supporting cannabis legalization, there’s plenty of room to build a brand in this space.

Inebriation is America’s true national pastime. You could see it as people just seeking an escape from daily troubles, but it’s also a way to shift our thinking to get a new perspective on the world. Considering how much we pay for entertainment that’s merely stimulus we filter through our perception, $10 to pleasantly alter that perception is not a half-baked idea.

Categories: Business News raises another $56 million

2018, March 20 - 3:16am

British startup says that “a new tier 1 global institutional investor” has made an important investment commitment in the furniture company. This mysterious investor is willing to lead a new $56 million round (£40 million) with existing investors Partech Ventures, Level Equity and Eight Roads Ventures also participating.

It sounds like the funding round isn’t finished just yet, so could end up raising more than that.

More interestingly, the company has shared some details about its balance sheet. In 2017, the company has been profitable in the U.K., France, Belgium, the Netherlands and Luxembourg. And if you take into account the entire company in all countries where it operates, is currently cashflow positive.

In 2017, the company has generated a net revenue of $178 million (£127 million), which represents a 40 percent increase compared to 2016. So it sounds like is on the right path to profitability.

And that’s why the company also announced that Adrian Evans is joining the company as CFO. He previously worked at Yoox Net-A-Porter. This release sounds like is now optimizing the company for a potential IPO.

The company sells quality furniture at an affordable price. wants to disrupt high-end furniture stores by controlling everything from manufacturing to the e-commerce platform. This way, the company doesn’t have to pay as many middle players and can offer cheaper prices.

As e-commerce is also becoming the norm, it fosters competition with furniture giants, such as IKEA. Going to’s website is as easy as going to IKEA’s website after all.

Categories: Business News

Google alums launch Maslo, a digital companion to mediate technology’s uncanny valley

2018, March 20 - 3:00am

Earlier this month, two former Google staffers quietly launched a new app that’s designed to help users overcome technology’s uncanny valley and develop a more healthy relationship with the ubiquitous electronic assistant that “lives” in our pockets.

Called Maslo, the new app (and the company behind it), in the words of its founders, was built to develop a “personified AI technology that interacts with empathy and playfulness.”

At its core, the first iteration of Maslo is a daily check-in tool that encourages and develops mindfulness, according to founders Ross Ingram and Cristina Poindexter.

Once downloaded, Maslo is a voice-activated journaling tool with a basic status update feature that encourages users to log an emoji representation of their emotional state at a particular moment and spend a minute talking to the app about what’s going on.

The idea, the founders say, is to have Maslo evolve and personalize as users interact with it. You can see what the company’s blobby AI looks like below.

[gallery ids="1608868,1608869,1608870,1608871,1608872,1608873"]

Ingram, who was a former Sphero employee working on projects like the BB-8 before he joined Google, has thought deeply about how technology intersects with the human psyche and how people create bonds with the technologies they use.

“We started building robots in 2010 and in the 2012 to 2013 time frame we wondered what this would look like if we added some personality to this — and some kind of relationship,” says Ingram. “Whenever we launched these robots out into the world… people had this desire to connect on a deeper level… people wanted to share aspects of themselves with the robot.”

Meanwhile, his co-founder noticed the same behaviors from people who were interacting with the Google assistants in their early days.

“A  lot of these interactions were non-utility queries,” says Poindexter, a Yale-educated sociologist, who worked on Google’s soon-to-be-announced assistants in the Pixel phone and Google Home in 2016 when she and Ingram first met. 

“There was this need to go in and help people on a deeper level… I have a background in sociology and I look at it from a users’ perspective of what do people need,” Poindexter says. “A lot of these interactions [with the assistant] were mulling things over and needing a place to express them… and Google can’t deliver on that and from a brand perspective Google didn’t want to.”

That’s perfectly clear from Google’s latest commercial.

By contrast, Maslo wants to be a space where people can more comfortably address the emotional aspects of user’s lives.

“It’s the way we define an assistant versus a companion… assistants help things get done in the external world and companions are going to help us get things done in our internal world,” says Ingram. 

“There are going to be different classes of machines that interact and relate to humans on different levels,” Poindexter adds. “We are seeing thousands of people using machines for assistant-based things… we know that where this is going we’re going to start talking more to whatever you want to call them — assistants or companions — and Alexa won’t help you figure out if you need help.”

With Ingram’s experience in design and hardware, the two came to the conclusion (as they relate in a blog post about Maslo’s early days), that technology “can help us become more human, and less robotic.

Ingram left Google in December of 2016 and Poindexter followed in February. The two moved down to Los Angeles and began collaborating on the project that would eventually become Maslo.

Maslo co-founders Ross Ingram and Cristina Poindexter

Over the long-term, the two founders think of Maslo as a gateway to interacting with other services that a user may need — and one that is completely focused on security. Other tools can help with therapy, self-improvement, education or entertainment, and Maslo wants to be the funnel that prompts users to take advantage of those services when necessary.

Importantly, in this era of increased privacy protection, the two have built Maslo so that most of the user information that Maslo collects stays on a user’s device rather than on servers that the company hosts. “Privacy and trust is the most critical to us,” says Ingram. “We’ve designed the architecture in a way that does keep a lot of the sensitive information on the phone. We do have to upload some things to the cloud in a secure way to continue to develop Maslow’s back end and machine learning… [But] we don’t have access to the actual voice note… we are able to interpret whatever is shared using our algorithms.”

Meanwhile transformative powers of technology and the ways in which it can provide a positive influence in people’s lives isn’t just rhetorical hyperbole for Ingram — he’s experienced it himself.

At 16 years old, Ingram, who grew up in a small town in rural Colorado, faced three felony charges and expulsion from his high school for stealing a computer. Always interested in technology, Ingram came from a working class family that didn’t have enough money for him to indulge in his favorite pastime.

The brush with the law could have landed him in jail, but Ingram was sent to a diversion program to keep kids out of prison; while there, the young developer decided to pursue a career in computer science. He enrolled in Denver’s Metropolitan Community College, and while attending class managed to talk his way into a job with Sphero.

Ingram met the Sphero founders when they were just a collection of Boulder-based Android developers going through the Techstars program. When the company raised its first round, Sphero hired Ingram as its seventh employee and his career was off to the races.

“Going through that experience… helped me develop my sense of identity and figure out where I wanted to go in life,” Ingram says. “That’s very much what we’re focused on with Maslo today. Maslo is a reference to Maslow’s hierarchy of needs and developing the tools you need to have that sense of self.”

Several studies (including this one from the University of Iowa) discuss the positive effects of journaling on mental health and addressing trauma. And Poindexter said that’s where Maslo wants to begin.

“In the beginning there needs to be some sort of joy in the exercise,” she says. “We really want to reflect back to people what they’re saying… [Maslo] holds up a mirror… it’s a sounding board and doesn’t necessarily give you the answers but shows you what you might already know.”

Over time, the two co-founders expect that the application will evolve to become more personalized as users develop a relationship with the AI they’re talking to. “The way that Maslo looks and the way Maslo animates and talks will be something that happens down the road,” says Ingram. “Being able to build this sense of companionship between machine and the user so that it is this safe space to access is very important.”

Categories: Business News

HQ Trivia had a weird night

2018, March 20 - 2:59am

HQ Trivia was removed from the App Store following a controversial ending to a $25K game on Sunday night, according to Business Insider.

HQ has introduced a new high-stakes version of the game where one winner takes home a larger prize. However, on Sunday night, no one won the $25K.

The company posted on its Twitter account that moderators kick players who break the company’s TOS.

HQ moderators kick players that violate HQ’s Terms of Service and Contest Rules. For more information, please refer to our Terms of Service here:

— HQ Trivia (@hqtrivia) March 19, 2018

HQ would not be specific about what rules were broken, but BI reports that Twitter users had suggested it was due to jailbroken iPhones, which could be running software that gives users a leg up in the trivia competition.

For those who missed the game last night, two players remained for the final question. One was removed due to breaking the TOS, and the remaining player missed the last question, resulting in no winner.

Cheating seems to be a growing problem with HQ Trivia. There are countless guides online about how to cheat, including obvious methods like using voice dictation and a second device to Google search each question. The time limit makes that more difficult, but not impossible.

But as HQ grows its prize pot — the original prize was $1000 — cheating on the platform, and the methods by which people cheat, is only bound to intensify.

Even more bizarre, the app was seemingly removed from the App Store following the game. It has since re-appeared on the App Store.

HQ says that last night’s game and HQ’s removal from the App Store are unrelated events. A spokesperson from the company confirmed Mashable’s report that the app was removed because of a clerical error. Long story short, someone at HQ forgot to update the expired credit card info in the developer portal of the App Store.

App analytics firm Apptopia confirmed that HQ Trivia was removed from the App Store briefly, and that it has been falling in ranking for the past 30 to 60 days.

We reached out to Apple and haven’t heard back. We will report back as soon as we know more.

Categories: Business News

Desktop Metal gets another $65 million in a round led by Ford

2018, March 20 - 2:13am

Desktop Metal has had no issues raising interest (or funding) in the manufacturing world. The metal 3D printing company announced today that it’s score another $65 million in backing, bringing its total to $277 million. This latest round was led by Ford, and also includes addition money from previous backer, Future Fund. 

Ford’s interest in company that 3D prints metal is pretty clear, of course, and the automotive giant is taking things a step further by adding its Chief Technology Officer Ken Washington to Desktop Metal’s Board of Directors.

The tech isn’t quite ready to start printing out cars on Ford’s production line just yet, but the companies told CNBC that they’re working toward that seeming inevitability. Desktop Metal already produces a printer built specifically for factory production.

Slated for release in 2019, the company’s Production system is a push to make its technology scalable on the production line. The core of Desktop Metal’s tech binds powders into polymers and cook them in a furnace. The company claims its tech is 100-times faster and 20-times cheaper than existing 3D printing technologies.

Ford joins an already impressive roster of names that have invested in the startup, including Google Ventures (GV), GE Ventures, New Enterprise Associates (NEA) and Lowe’s. BMW iVentures, has also seen the potential in tech — the automotive giant’s VC wing invested in Desktop Metal this time last year, with an eye toward the future, stating that the company “is shaping the way cars will be imagined, designed and manufactured.”

Categories: Business News

This 3D-printing startup helps orthodontists straighten your teeth

2018, March 20 - 2:11am

It’s time to welcome another startup to the clear-teeth-aligner market. Meet ArchForm, a Y Combinator-backed teeth-aligner software startup that lets orthodontists create, design and 3D print aligners within their own offices. The idea is to provide orthodontists with a way to better compete against some direct-to-consumer teeth-aligner startups and cut down on the cost of Invisalign.

The cost of braces and invisible aligners — those clear, mouthguard-like pieces of plastic — varies, but treatments can range from $4,685 to $6,500 for adolescents, and adult treatments can cost up to $7,135, according to a 2013 American Dental Association survey. Last year, the orthodontics market saw $11 billion in revenue, according to market research company IBISWorld.

ArchForm is trying to tap into the growing accessibility of the 3D printer market to enable orthodontists to 3D print their own clear aligners in-office. Orthodontists currently pay about $1,700 per patient to Invisalign, the company says. So in order to make money, orthodontists sometimes charge patients upwards of $7,000. ArchForm charges orthodontists just $50 per patient.

“I was inspired to start the company because I worked in my father’s orthodontic office,” ArchForm founder Andrew Martz told TechCrunch in an email. “I saw that 3D printers had advanced for enough to make these devices in dental offices, and knew from experience that easy-to-use software to virtually move the teeth was the missing piece to allow every orthodontist to 3D print their own aligners.”

In the last couple of years, a number of teeth-aligner startups have emerged. The pack includes the likes of SmileDirectClub, Uniform Teeth, Candid and Orthly. None of the startups are exactly the same, but all aim to reduce the cost of clear aligners, as well as the number of visits to the orthodontist — with some even cutting out the in-person orthodontist visit altogether. ArchForm takes a different approach by enabling local orthodontists to simply enhance their existing businesses.

“We believe that orthodontists do a better job of treating most patients when they can physically be there to treat them,” Martz said. “To make clear aligners work, raised buttons/attachments are placed on teeth as a way for the aligner to grip the teeth and make them fully straight. Tele-dentistry companies don’t have these — which are a very fundamental part of orthodontic treatment.”

In ArchForm’s current customer base, 75 percent of orthodontists who sign up to use the software already have 3D printers.

“If they don’t already have one, the rest are looking into buying a 3D printer, because they only cost $3350 and Invisalign costs $1750/patient,” Martz said.

For the orthodontists who would rather not invest in their own 3D printer, they can send the design to orthodontic laboratories that are equipped with 3D printers and powered by ArchForm’s software.

Categories: Business News

Pinterest is slowly rolling out its automated shopping ads to more marketers

2018, March 19 - 11:37pm

Pinterest is looking to continue to increase its portfolio of ads, though sometimes that can take a little while to see the light of day — and that includes a new-ish tool called Shopping Ads that’s slowly getting opened to more marketers and advertisers.

Getting new ad formats is important for a smaller company looking to build out an advertising business, as it has to show potential advertisers it can offer an array of tools to play with as they experiment with that service. The company said today that it’s expanding those shopping ad tools to hundreds of additional advertisers after launching a pilot program last year as it looks to continue to ramp up that tool. Pinterest has to be able to convince marketers that it should be a mainstay advertising purchase alongside Facebook and Google, which are able to routinely show returns in value for their advertising spend.

Shopping ads automatically create promoted pins from an existing product feed for a retailer. That means it’s basically one less thing for retailers to worry about as they add more and more content to the service. Most of Pinterest’s content online is business content as users share products they might be interested in one day buying or already own. As Pinterest gets more and more data on this, they’ll have a better handle on what ads work best, and hope that businesses will hand off the process in full to something more automated.

Pinterest hopes to capture that routine user behavior of planning what they want to do next, whether that’s an outfit to wear that day or some kind of major event or purchase down the line. Getting a hold of those users in the moment they might be interested in a new product is key to the company’s pitch to advertisers. You can more or less consider this a continued test as the company starts to slowly give the tool to the advertisers it works with before it becomes generally available. If it works, it could probably end up down the line in the hands of all advertisers, which could help for small- to medium-sized businesses without a lot of experience build out their early marketing campaigns.

Categories: Business News

Bear Flag Robotics wants to sell an autonomous tractor for farms

2018, March 19 - 11:00pm

Autonomous vehicles are increasingly becoming the shiny object in Silicon Valley. But the opportunity doesn’t just extend to cars driving around the streets of a major metropolitan area, and Igino Cafiero and Aubrey Donnellan hope to take it somewhere a little less obvious: the middle of an orchard.

Cafiero and Donnellan are building an autonomously-driven tractor as part of a startup called Bear Flag Robotics. The pair argue that there’s increasingly a struggle to find enough labor to work on farms, and even then, the costs are continuing to rise over time — leading to a need to increase those efficiencies on the actual field in addition to a lot of new technology like satellite imagery and computer vision to analyze the health of plants. The first product for Bear Flag Robotics is a self-driving tractor, and the company is coming out of Y Combinator’s winter class this year.

“We got a tour of an orchard and just how pronounced the labor problem is,” Donnellan said. “They’re struggling to fill seats on tractors. We talked to other growers in California. We kept hearing the same thing over and over: labor is one of the most significant pain points. It’s really hard to find quality labor. The workforce is aging out. They’re leaving the country and going into other industries.”

There are certainly a lot of technical challenges that go into it, and not just pertaining from having the right computer vision products in place in order to create an autonomous tractor. For example, the tractors have to be able to operate without a GPS signal, Donnellan said, simply because operating a tractor in an orchard may mean driving around with a ton of canopy cover — which could block the signal. It might be a little simpler to just drive down a path in an orchard, but there’s still quite a lot to consider, she said.

“We have this platform that we’ve plugged a ton of sensors into it,” Cafiero said. “That includes cameras. When you look forward, once we’ve automated the driving part, the sky’s the limit in terms of utilizing some of this technology once it’s out there. When we’re out there we can use these cameras, and be able to make recommendations and spot treatment in the field.”

When it comes to testing, Cafiero and Donnellan just go out to an orchard over in Sunnyvale a few times a week to see what some of the challenges growers face.

While finding labor has been a challenge, Cafiero acknowledges that there are still questions around undocumented labor when it comes to labor on those farms. He said, in the end, Bear Flag Robotics’ aim is to augment the workforce by taking away some of the more mundane tasks required on the fields. Cafiero also said that there’s a lot of reverse immigration happening from the U.S., leading to more of a labor shortage.

“The work itself is really tough work,” Donnellan said. “You’re in the field all day long, sometimes in inclement conditions. One of the tasks we’re automating is spraying, fungicides, herbicides, and these people out there, they’re wearing hazmat suits. It’s not good for their health to be doing these tasks in general. When you’re presented in higher paying jobs in other fields, there’s less of a case to go into that job, and there’s demand in a lot of other industries like construction [and other industries] where it’s easier work and better pay.”

Selling the actual tractor can also be a challenge, simply because potential customers will be buying their equipment down the road at sellers they know. If something breaks down, they need someone to come over, in person, as soon as possible to fix it or risk losing yield. And the major equipment providers may too see the need to start working on autonomous tools. Cafiero’s hope is that the startup will be able to work with local sellers and get into those channels, and that’s the only logical place to start. There might be some aim to scale up over time, but the company hopes to just get started with local dealerships for now.

Categories: Business News

Biomedical startup AesculaTech is creating a new, more patient-friendly drug delivery system

2018, March 19 - 10:56pm

“Reverse chocolate” — that’s how AesculaTech co-founder and chief science officer Niki Bayat describes the material created by its proprietary technology. Chocolate is solid until heated, when it melts deliciously into liquid. AesculaTech’s material, on the other hand, is a liquid at low temperatures, turns into a gel when heated and then reaches its final, solid state at body temperature. (If you are having a hard time visualizing the process or are distracted by thoughts of dessert, there’s a gif below that shows it being injected into a 37 degree Celsius water bath).

By changing the composition of the material, AesculaTech is able to control the temperature at which it transitions into different states. While the liquid is transforming into a gel, different compounds, including medications, can be added to it. Bayat and co-founder Andrew Bartynski, who are in Y Combinator’s latest startup batch, say it has a wide range of potential applications, including pharmaceuticals, medical devices, cosmetics and textiles.

First, the material is being used in a treatment for dry eye syndrome. AesculaTech’s founders say the condition affects more than 20 million people in America, who collectively spend $3.5 billion a year treating symptoms that can include a burning, scratchy sensation, discharge and impaired vision. Prescription treatments like Restasis and Xiidra can take weeks or even months to reach full effectiveness, while over-the-counter eye drops bring only minutes of relief and need to be reapplied constantly. AesculaTech’s treatment, however, is designed to be administered by a doctor during a quick, in-office procedure and last for about a year. It is slated to be commercially available by 2019.

Bayat and Bartynski, AesculaTech’s chief executive officer, met in 2012 while doing graduate work in chemical engineering at the University of Southern California and discovered a shared interest in unique classes of materials. As graduation drew closer, they began to think of what they wanted to do next.

“One day I was talking to my dad and I heard from him that he’d been diagnosed with glaucoma, but because he’d had heart surgery, he couldn’t have another one,” says Bayat. “I kept thinking there should be a better way to treat glaucoma and so I started working on this project with Andrew and a few other people.”

The team decided to focus on dry eye syndrome first because it is easier to treat, but they plan to work on glaucoma medication in the future. The treatment starts off as an injectable liquid that is inserted into the patient’s tear duct by a doctor. It turns into a solid after raising to body temperature, forming a tiny plug that keeps tears from draining away from the surface of the eye.

AesculaTech has already performed pre-clinical animal trials that show its dry eye treatment creates statistically significant increases in tears on eyes and are preparing for human trials to bring it closer to approval from the Food and Drug Administration.

Because it only needs to be applied once a year, the treatment addresses another important health issue: medication compliance. Many patients don’t stick to drug regimens for chronic conditions as directed by their physicians even though it reduces the efficacy of their medicines. In the case of antibiotics, patient non-compliance can also impact public health by increasing bacterial resistance. As it branches out beyond ophthalmic treatments, Bayat and Bartynski hope their technology will form the foundation of a new way of taking medication that is more realistic for patients to follow.

“To allow people to get the treatment they need without having to interact with medication on a daily basis is hugely valuable because you deliver the treatment to them continuously so they don’t have to interrupt their daily life or be bound to an eye drop or pill pack,” says Bartynski.

“It’s not only about the treatment of dry eye or glaucoma,” adds Bayat. “We are thinking of a platform for drug delivery technology.”

AesculaTech’s founders say the technology can also be used to create materials for a wide range of products, like cosmetics and smart textiles that are temperature responsive. The startup’s plan is to form partnerships with companies, license their technology and help them bring new products to market. The material hasn’t been tested for food products yet, but Bayat and Bartynski say they haven’t seen any indications that it isn’t edible, so reverse chocolate may one day be more than just a simile.

Categories: Business News

Jay-Z’s Roc Nation and First Round Capital invest $3 million in bail reform startup Promise

2018, March 19 - 10:00pm

Nationwide, 62 percent of the jail population accounts for people who can’t afford bail, according to the Vera Institute of Justice. A lot of these incarcerated individuals are behind bars because they committed crimes at the misdemeanor level or lower. This is a significant statistic from a human rights perspective, as well as an economic one. It costs about $38 million a day to keep these largely nonviolent people behind bars, according to the Pretrial Justice Institute.

This is where Promise, a de-carceration startup that just raised a $3 million round led by First Round Capital with participation from Jay-Z’s Roc Nation, 8VC and Kapor Capital, comes in. Last Father’s Day, Jay-Z penned an op-ed about the bail industry and pre-trial incarceration. He noted how every year, $9 billion is wasted incarcerating people who have not been convicted of crimes.

“We are increasingly alarmed by the injustice in our criminal justice system,” Jay-Z said in a statement. “Money, time and lives are wasted with the current policies. It’s time for an innovative and progressive technology that offers sustainable solutions to tough problems. Promise’s team, led by co-founder and CEO Phaedra Ellis-Lamkins, is building an app that can help provide ‘liberty and justice for all’ to millions.”

Promise, which is part of Y Combinator’s current batch of startups, offers counties and local governments an alternative to holding low-risk people behind bars simply because they can’t afford bail.

For each participant, Promise provides counties with a comprehensive intake procedure and then sets up each participant with a care plan specific to them. Promise will then monitor and support participants by helping them ensure they know when they’re supposed to appear in court, and remind them of obligations like drug testing or substance abuse treatment needed. The app also provides participants with job training, housing, counseling and referrals.

“People are going to jail because they look at a piece of paper and misread it, or are going to jail because they can’t afford a class because they’re instead paying child support,” Ellis-Lamkins told TechCrunch.

And many of these people are brown or black. Last year, when Senators Kamala Harris and Rand Paul introduced a bail reform bill, the Pretrial Integrity and Safety Act, they wrote in an op-ed how black and Latinx people are more likely to be detained before trial and less likely able to pay for bail. Senators Harris and Paul pointed to how black and Latino men pay 35 percent and 19 percent higher bail, respectively, than white men.

“If we’re putting people in jail because they’re poor, brown or black, we’re spending money the wrong way,” Ellis-Lamkins said.

With Promise, Ellis-Lamkins and her team are using technology to try to create a system that works better for everyone, she said. Instead of a county paying to incarcerate someone simply because they can’t afford to post bail, they can use Promise to monitor compliance with court orders and better keep tabs on people via the app and, if needed, GPS monitoring devices. Counties, courts, case managers and other stakeholders can also access progress reports of individuals to monitor compliance.

Already, Promise is onboarding one county this week and is in talks with another three counties. Instead of a county jail paying $190 per day per person, Ellis-Lamkins said, Promise charges counties just $17 per person per day.

“Our system is built on reducing recidivism,” Ellis-Lamkins said. “Our ideal outcome is the person gets a job, does not reoffend and does not continue in the system.”

Categories: Business News

Here are the top states and cities for startups in the South

2018, March 19 - 2:40am

The American South may not be the first region that comes to mind when you hear the phrase “hotbed of tech entrepreneurship,” but, slightly misguided perceptions aside, it’s home to a diverse and growing collection of startups.

Here, we’re going to take a deep dive into the startup funding data for the region.

What is “the South?”

Just like it’s a common pastime for many city dwellers to argue about the precise boundaries of neighborhoods, there’s often some disagreement about the exact contours of the U.S.’s various regions. To quash rabble-rousing from the get-go, we’re using the U.S. Census Bureau’s definition of “the South” on its official map of the United States. Below, we display a map of the states we’re going to look at today.

Much like barbecue, the South is not a monolithic concept. So to incorporate some regional flavor into the following analysis, we’re also going to use the same regional divisions that the U.S. Census Bureau uses.

By doing this, we’ll be able to get a better idea of the relative contribution states from each sub-region make to startup activity in the South overall.

The ebb and flow of deal and dollar volume

As is the case with most of the country, the South appears to be experiencing a shift in startup funding as we move toward the latter half of a bull run in entrepreneurial activity. The chart below shows a divergence in overall deal and dollar volume over time.

Much like in the rest of the U.S., reported deal and dollar volume are heading in different directions. Part of this may be due to reporting delays — it can sometimes take a few years for seed and early-stage rounds to get added to databases like Crunchbase’s . Nonetheless, there is a slow and generally upward creep in round sizes at most stages of funding. And that’s not just a Southern thing; it’s a country-wide trend.

Let’s disaggregate these figures a bit. We’ll start with deal counts and move on to dollar volume from there.

A closer look at southern venture deal and dollar volume

In the chart below, you’ll see venture deal volume broken out by sub-region.

Over the past several years, reported venture deal volume has been on the downswing. From a local maximum in 2014 through the end of 2017, it’s down almost 35 percent overall. But that’s not the whole picture. The relative share of deal volume has changed, as well.

Although it’s not immediately clear just by looking at the chart above, startups in the South Atlantic sub-region have accounted for an increasingly large share of the funding rounds. For example, in 2012, South Atlantic startups attracted 54 percent of the deal volume. In 2017, that grows to 64 percent. Startups in the West South Central sub-region have pretty consistently pulled in between 28 and 30 percent of the deals, so where’s the loss coming from? Startups headquartered in Kentucky, Tennessee, Mississippi and Alabama pulled in just 8 percent of deals in 2017, compared to 18 percent in 2012.

It’s a similar story with dollar volume.

In general, dollar volume follows the same pattern, albeit with a bit more variability. Regardless, startups in the South Atlantic sub-region are hoovering up an ever-larger share of venture dollars, and there’s little to indicate that trend will reverse itself any time soon.

Where are the regional hotspots for deal-making in the south?

Let’s see which states accounted for most of the deal volume. The chart below shows the geographic distribution of deal-making activity by startups in each Southern state from the beginning of 2017 through time of writing. It should come as no surprise that much of the activity is concentrated in states with higher populations.

And here’s the distribution of dollar volume among southern states.

Despite some variation in which states are at the top of the ranks, the share of deal and dollar volume raised by startups in the top three states is remarkably similar, coming in at between 52 and 53 percent for both metrics.

The top startup cities in the south

We started by looking at the South as a whole and then drilled into its sub regions and states. But there’s one layer deeper we can go here, and that’s to rank the top startup cities in the South.

In the interest of keeping our rankings fresh and timely, we’re covering activity from the past 15 months or so, from the start of 2017 through mid-March 2018. But before highlighting some of the more notable hubs, let’s take a look at the numbers.

In the chart below, you’ll find the top 10 metropolitan areas where Southern startups closed the most funding rounds.

The chart below shows reported dollar volume over the same period of time.

Much like we saw at the state level, the top five startup cities — ranked by both deal and dollar volume — are the same, although there’s some variation between where each one ranks. In order, the D.C., Austin and Atlanta metro areas rank in the top three for each metric, while Dallas and Raleigh, NC switch off between fourth and fifth place.

Startups capitalize on the nation’s capital

To be frank, Washington, D.C.’s top-shelf ranking was a bit of a surprise. It may be the fact that Austin, TX plays host to South By Southwest, a somewhat more relaxed culture and/or a preponderance of excellent breakfast taco and barbecue joints, but to many — ourselves included — the city feels like it would have a more active startup scene than the nation’s capital. But that’s not exactly the case. The D.C. metro area had more venture deal and dollar volume than Austin for seven out of the last 10 years, and startups based in the nation’s capital have raised more than twice as much money so far in 2018.

D.C.-area startups have recently raised some notable rounds. Just a couple of weeks prior to the time of writing, Viela Bio raised $250 million in a Series A round (in late February 2018) to continue funding research and testing of its treatments for severe inflammation and autoimmune diseases. And on the later-stage end of things, education technology company Everfi raised $190 million in a Series D round that had participation from Amazon founder and CEO Jeff Bezos, former Alphabet executive Eric Schmidt and Medium CEO Ev Williams. Other D.C. companies, including Mapbox,, Afiniti and ThreatQuotient, have all raised late-stage rounds within the past 15 months.

Startup ecosystems in Southern cities may pale in comparison to places like New York and San Francisco, but it wouldn’t be wise to discount the region entirely. A large number of interesting companies call the lower half of the Lower 48 home, and as the cost of living continues to rise on the east and west coasts, don’t be surprised if many current and would-be founders opt to stay down home in the South.

Categories: Business News

Late-blooming startups can still thrive

2018, March 18 - 2:10am

It seems like startup news is full of overnight success stories and sudden failures, like the scooter rental company that went from zero to a $300 million valuation in months or the blood-testing unicorn that went from billions to nearly naught.

But what about those other companies that mature more gradually? Is there such a thing as slow and successful in startup-land?

To contemplate that question, Crunchbase News set out to assemble a data set of top late-blooming startups. We looked at companies that were founded in or before 2010 that raised large amounts of capital after 2015, and we also looked at companies founded a least five years ago that raised large early-stage funds in the last year. (For more details on the rules we used to select the companies, check “Data Methods” at the end of the post.)

The exercise was a counterpoint to a data set we did a couple of weeks ago, looking at characteristics of the fastest growing startups by capital raised. For that list, we found plenty of similarities between members, including a preponderance of companies in a few hot sectors, many famous founders and a lot of cancer drug developers.

For the late bloomers, however, patterns were harder to pinpoint. The breakdown wasn’t too different from venture-backed companies overall. Slower-growing companies could come from major venture hubs as well as cities with smaller startup ecosystems. They could be in biotech, medical devices, mobile gaming or even meditation.

What we did find, however, was an interesting and inspiring collection of stories for those of us who’ve been toiling away at something for a long time, with hopes still of striking it big.

Pivots and patience

Even youthful startups have been known to make a major pivot or two. So it’s not surprising to see a lot of pivots among late bloomers that have had more time to tinker with their business models.

One that fits this mold is Headspace, provider of a popular meditation app. The company, founded in 2010 by a British-born Buddhist monk with a degree in circus arts, started as a meditation-focused events startup. But it turned out people wanted to build on their learning on their own time, so Headspace put together some online lessons. Today, Santa Monica-based Headspace has millions of users and has raised $75 million in venture funding.

For late bloomers, the pivot can mean going from a model with limited scalability to one that can attract a much wider audience. That’s the case with Headspace, which would have been limited in its events business to those who could physically show up. Its online model, with instant, global reach, turns the business into something venture investors can line up behind.

Sometimes your sector becomes hip

They say if you wait long enough, everything comes back in style. That mantra usually works as an excuse for hoarding ’80s clothes in the attic. But it also can apply to entrepreneurial companies, which may have launched years before their industry evolved into something venture investors were competing to back.

Take Vacasa, the vacation rental management provider. The company has been around since 2009, but it began raising VC just a couple of years ago amid a broad expansion of its staff and property portfolio. The Portland-based company has raised more than $140 million to date, all of it after 2016, and most in a $103 million October round led by technology growth investor Riverwood Capital.

CloudCraze, which was acquired by Salesforce earlier this week, also took a long time to take venture funding. The Chicago-based provider of business-to-business e-commerce software launched in 2009, but closed its first VC round in 2015, according to Crunchbase records. Prior to the acquisition, the company raised about $30 million, with most of that coming in just a year ago.

Meanwhile, some late bloomers have always been fashionable, just not necessarily as VC-funded companies. Untuckit, a clothing retailer that specializes in button-down shirts that look good untucked, had been building up its business since 2011, but closed its first venture round, a Series A led by VC firm Kleiner Perkins, last June.

Slow-growing venture-backed startups are still not that common

So yes, there is still capital available for those who wait. However, the truth of the matter is most companies that raise substantial sums of venture capital secure their initial seed rounds within a couple years of founding. Companies that chug along for five-plus years without a round and then scale up are comparatively rare.

That said, our data set, which looks at venture and seed funding, does not come close to capturing the full ecosystem of slow-growing startups. For one, many successful bootstrapped companies could raise venture funding but choose not to. And those who do eventually decide to take investment may look at other sources, like private equity, bank financing or even an IPO.

Additionally, the landscape is full of slow-growing startups that do make it, just not in a venture home run exit kind of way. Many stay local, thriving in the places they know best.

On the flip side, companies that wait a long time to take VC funding have also produced some really big exits.

Take Atlassian, the provider of workplace collaboration tools. Founded in 2002, the Australian company waited eight years to take its first VC financing, despite plentiful offers. It went public two years ago, and currently has a market valuation of nearly $14 billion.

The moral: Those who take it slow can still finish ahead.

Data methods

We primarily looked at companies founded in 2010 or earlier in the U.S. and Canada that raised a seed, Series A or Series B round sometime after the beginning of last year, and included some that first raised rounds in 2015 or later and went on to substantial fundraises. We also looked at companies founded in 2012 or earlier that raised a seed or Series A round after the beginning of last year and have raised $30 million or more to date. The list was culled further from there.

Categories: Business News

Tinder owner Match is suing Bumble over patents

2018, March 17 - 11:47am

Drama is heating up between the dating apps.

Tinder, which is owned by Match Group, is suing rival Bumble, alleging patent infringement and misuse of intellectual property.

The suit alleges that Bumble “copied Tinder’s world-changing, card-swipe-based, mutual opt-in premise.” The lawsuit also accuses Tinder-turned-Bumble employees Chris Gulczynski and Sarah Mick of copying elements of the design. “Bumble has released at least two features that its co-founders learned of and developed confidentially while at Tinder in violation of confidentiality agreements.”

It’s complicated because Bumble was founded by CEO Whitney Wolfe, who was also a co-founder at Tinder. She wound up suing Tinder for sexual harassment. 

Yet Match hasn’t let the history stop it from trying to buy hotter-than-hot Bumble anyway. As Axios’s Dan Primack pointed out, this lawsuit may actually try to force the hand for a deal. Bumble is majority-owned by Badoo, a dating company based in London and Moscow.

(It wouldn’t be the first time a dating site sued another and then bought it. JDate did this with JSwipe.)

Match provided the following statement:

Match Group has invested significant resources and creative expertise in the development of our industry-leading suite of products. We are committed to protecting the intellectual property and proprietary data that defines our business. Accordingly, we are prepared when necessary to enforce our patents and other intellectual property rights against any operator in the dating space who infringes upon those rights.

I have, um, tested out both Tinder and Bumble and they are similar. Both let you swipe on nearby users with limited information like photos, age, school and employer. And users can only chat if both opt-in.

However, Tinder has developed more of the reputation as a “hookup” app and Bumble doesn’t seem to have quite the same image, largely because it requires women to initiate the conversation, thus setting the tone.

As TechCrunch’s Sarah Perez pointed out recently, “according to App Annie, Tinder is more than 10x bigger in terms of monthly users and 7x bigger in terms of downloads in the last 12 months, versus Bumble.”

We’ve reached out to Bumble for comment.

Categories: Business News

Enterprise subscription services provider Zuora has filed for an IPO

2018, March 17 - 6:07am

Zuora, which helps businesses handle subscription billing and forecasting, filed for an initial public offering this afternoon following on the heels of Dropbox’s filing earlier this month.

Zuora’s IPO may signal that Dropbox going public, and seeing a price range that while under its previous valuation seems relatively reasonable, may open the door for coming enterprise initial public offerings. Cloud security company Zscaler also made its debut earlier this week, with the stock doubling once it began trading on the Nasdaq. Zuora will list on the New York Stock Exchange under the ticker “ZUO.” Zuora CEO Tien Tzuo told The Information in October last year that it expected to go public this year.

Zuora’s numbers show some revenue growth, with its subscriptions services continue to grow. But its losses are a bit all over the place. While the costs for its subscription revenues is trending up, the costs for its professional services are also increasing dramatically, going from $6.2 million in Q4 2016 to $15.6 million in Q4 2017. The company had nearly $50 million in overall revenue in the fourth quarter last year, up from $30 million in Q4 2016.

But, as we can see, Zuora’s “professional services” revenue is an increasing share of the pie. In Q1 2016, professional services only amounted to 22% of Zuora’s revenue, and it’s up to 31% in the fourth quarter last year. It also accounts for a bigger share of Zuora’s costs of revenue, but it’s an area that it appears to be investing more.

Zuora’s core business revolves around helping companies with subscription businesses — like, say, Dropbox — better track their metrics like recurring revenue and retention rates. Zuora is riding a wave of enterprise companies finding traction within smaller teams as a free product and then graduating them into a subscription product as more and more people get on board. Eventually those companies hope to have a formal relationship with the company at a CIO level, and Zuora would hopefully grow up along with them.

Snap effectively opened the so-called “IPO window” in March last year, but both high-profile consumer IPOs — Blue Apron and Snap — have had significant issues since going public. While both consumer companies, it did spark a wave of enterprise IPOs looking to get out the door like Okta, Cardlytics, SailPoint and Aquantia. There have been other consumer IPOs like Stitch Fix, but for many firms, enterprise IPOs serve as the kinds of consistent returns with predictable revenue growth as they eventually march toward an IPO.

The filing says it will raise up to $100 million, but you can usually ignore that as it’s a placeholder. Zuora last raised $115 million in 2015, and was PitchBook data pegged the valuation at around $740 million, according to the Silicon Valley Business Journal. Benchmark Capital and Shasta Ventures are two big investors in the company, with Benchmark still owning around 11.1% of the company and Shasta Ventures owning 6.5%. CEO Tien Tzuo owns 10.2% of the company.

Categories: Business News