Business News

Brazilian unicorn Ebanx will hit $2 billion in payments processed by the end of the year

Startup News - 7 hours 5 min ago

Ebanx, the newly minted Brazilian financial services unicorn, expects to process $2 billion in payments by the end of the year and is looking to expand its offerings into domestic payments as it grows.

Since its launch in 2012, Ebanx has primarily focused on helping international merchants sell locally in Brazil. The Brazilian business accounts for nearly 90% of the company’s revenue, but as it expands into other markets the company is also broadening its suite of services.

The company moved into local payment processing in Brazil in April of this year, and recently closed on a new financing round from previous investors FTV and Endeavor Catalyst that values the company north of $1 billion, according to chief executive Alphonse Voigt. 

The money will be used to continue an aggressive hiring push in new markets and the launch of the company’s local payment services in other geographies, beginning with Colombia in the new year.

As credit cards penetrate the Latin American market, approval rates for local companies are increasing, which represents an attractive new source of revenue, Voigt says.

In addition to the local payment processing, Ebanx recently announced that it became a payment partner for the Uber Pay ecosystem in Latin America and would start processing cash voucher and bank transfer payments for Uber in Brazil and across Latin America. The company also inked deals with Coursera, Scribd, Trip.com and Shopify throughout Latin America. Finally, the company partnered with Mastercard on an initiative to increase electronic payments in the Brazilian state of Parana.

Categories: Business News

Flowhub raises $23 million for its retail management software for cannabis dispensaries

Startup News - 9 hours 57 min ago

As cannabis dispensaries flourish across the country alongside the push to legalize medicinal and recreational marijuana use, demand for tools to manage the specificities of the weed retail business continues to increase.

Looking to address that need, Flowhub, a cannabis retail management software vendor, has raised $23 million from a consortium of investors including e.ventures, Evolv Ventures (the Kraft Heinz-backed venture capital fund) and Poseidon. 

The legal cannabis market is expected to top $66 billion over the next five years, according to estimates from Grand View Research, and entrepreneurs looking to get into the highly regulated industry are flocking to Flowhub’s suite of dispensary management services.

Not only does the company’s software address compliance concerns, according to chief executive officer Kyle Sherman, but it also integrates with companies like Dutchie for online ordering to facilitate in-store purchases and adds integrations with LeafBuyer and Leafly to provide more information to potential retailers.

The company also updated its software to include the “Stash” app, a mobile inventory management system, and a cashier app that integrates with iPads or other tablets to improve point-of-sale capabilities.

“What we are experiencing right now is an end to cannabis prohibition and Flowhub is on the front lines of this movement,” said Sherman, in a statement. “Every legal transaction completed with the Flowhub retail platform is a positive step forward, and we are committed to helping our customers build thriving cannabis businesses. With this investment, we will continue to automate the cannabis supply chain, retail and reporting processes and bring to market technology solutions that are not only shaping the cannabis retail business, but also driving forward the future of legalization and de-stigmatization.”

For investors like Emily Paxhia, a managing director at Poseidon, the opportunity to back a company helping to automate compliance in the regulated marijuana industry was too tempting to pass up.

“The compliance and regulation aspects make this a unique industry and Flowhub is one of the leading cannabis tech companies that is taking a meticulous and strategic approach,” Paxhia said in a statement. “We saw the potential for Flowhub’s technology and mission early on and we’re thrilled to continue to support them in delivering the cannabis retail experience of the future.”

Categories: Business News

ZeroDown, valued at $150 million, plans to take on Zillow

Startup News - 12 hours 8 min ago

Days out of Y Combinator, venture capitalists valued ZeroDown, a financial and real estate technology startup, at $150 million. The company had the perfect match of experienced founders and eye-popping ambitions to carve a new path to home ownership.

“I think we will be known as a company that makes it easier to buy a home in every single aspect,” ZeroDown co-founder and chief executive officer Abhijeet Dwivedi tells TechCrunch.

The startup, which has raised $30 million in total equity funding and more than $110 million in debt financing to help Bay Area residents make down payments on homes, now plans to take on Zillow and Redfin with its new home search engine.

The business, founded by former Zenefits chief operating officer Dwivedi, Laks Srini, Zenefits’ former chief technology officer, and Hari Viswanathan, a former Zenefits staff engineer, was founded last year and quickly landed backing from Sam Altman, followed by consumer technology venture capital fund Goodwater Capital. Targeting those in the Bay Area, where costs of home ownership are amongst the highest in the country, ZeroDown charges $10,000 to purchase your home outright and front your entire down payment.

ZeroDown is constructing a new path to home ownership

That is, however, if your home is priced between approximately $550,000 and $1,750,000 and you have an individual or combined salary of more than $200,000, stock options and some money put away (or some variation of this). If you meet these criteria, ZeroDown will purchase your home and lease it to you. The goal is to eliminate one of the largest pain points of home-buying, the down payment, and facilitate more real estate purchases.

The company says it intends to expand the service outside the greater San Francisco area to cities like Denver, Seattle and Austin, but given the $10,000 price tag and large population of wealthy tech workers in the Bay, the business could flourish in this area without expanding.

With the launch of its home search engine, Dwivedi says users will be able to learn about more than just the square footage of a home. The tool tells users whether a potential home is naturally lit, if it has a large backyard, if it has a decent commute to your work and to various schools and, most importantly, whether it’s dog friendly.

ZeroDown has also partnered with a number of San Francisco-based tech companies, including Pinterest, Postmates and Square, to provide their employees a rebate if they choose to purchase a home using ZeroDown.

“We know first-hand what companies need to support a great quality of life and keep their employees in the Bay Area,” Dwivedi said. “A part of that is loving where you live — feeling part of a local community.”

Categories: Business News

Kabuto is building smart suitcases for geeks

Startup News - 13 hours 57 min ago

French company Kabuto is launching a Kickstarter campaign today for the second generation of its smart carry-on suitcase. The company was previously known as Xtend.

If you think about smart suitcases, chances are you picture a suitcase with a battery pack in it and that’s it. In other words, they are not that smart. Kabuto is packing a bunch of electronics to add some more features.

At the top of the suitcase, you’ll find a fingerprint reader. You can unlock the suitcase with your fingerprint or use a key in case your suitcase battery is dead — yes, a smart suitcase means you have one more thing to charge in your life.

The suitcase comes with a 10,000 mAh battery that you plug to various USB-A and USB-C cables. This way, you can charge a device using a USB-A or USB-C cable from the top of the suitcase.

The pocket at the back of the suitcase is removable. For instance, you can store a laptop and a book in it in order to take it with you on a flight. The company uses a magnetic connection between the pocket and the suitcase, which means that you can plug the included USB-C cable to your laptop and then attach the pocket to the suitcase to charge your laptop when you’re not using it.

The suitcase features an expandable structure, four wheels with metallic bearings and tires, a strap to attach another bag to the large handle on top of your suitcase. It costs $435 on Kickstarter and it will cost $595 after the Kickstarter campaign.

People who like to pack things exactly the right way will think the Kabuto suitcase offers a lot of options. It’s not a suitcase for everyone, but it’s an interesting take. The company promises to ship all suitcases by the end of the year. The startup has previously raised $1 million (€900,000) from Frédéric Mazzella, Michel & Augustin, Bpifrance, Fabien Pierlot and others.

Categories: Business News

Spearhead will give $1M to 15 founders to invest freely

Startup News - 14 hours 56 min ago

Spearhead, an investment fund launched by AngelList’s Naval Ravikant and Accomplice’s Jeff Fagnan, plans to raise roughly $100 million for its third fund to provide founders $1 million each to invest in technology startups of their choosing.

The firm, created in 2017, initially provided founders $200,000 in investment capital sourced from Spearhead I, a $25 million vehicle, followed by Spearhead II, a $35 million vehicle. The group now plans roughly $100 million to give its founders 5x more capital to play with.

Each founder is allotted 15% carry in his or her fund, while Spearhead holds on to 5%. This time around, says Spearhead’s Jeff Fagnan, standout “leads,” or those tapped to deploy capital from the fund, will also have the opportunity to receive another $10 million to invest at the end of the two-year program during a culminating demo day-like event.

Spearhead is designed to train founders, who tend to be well-connected to the tech ecosystem and knowledgeable about startups, to be effective angel investors. Previous Spearhead leads include Shippo co-founder and chief executive officer Laura Behrens Wu, Scale AI founder and CEO Alex Wang and Rippling co-founder and chief technology officer Prasanna Sankar. To date, 35 founders have completed the program.

Applications to join Spearhead’s third cohort will become available this week. Those who participate will be encouraged to write checks at the pre-seed stage.

Spearhead is transforming founders into angel investors

“There’s starting to be gap opening up again at the pre-seed,” Fagnan tells TechCrunch. “Founders are the right way to fill that gap. Founders backing their most talented friends … founders backing founders is the right way for this to go. We need to redefine who thinks of themselves as an angel investor.”

To be eligible to become a Spearhead lead, you must live in San Francisco, Los Angeles, Boston or New York City and run, or very recently have run, a startup. The firm plans to accept around 15 applicants.

“We are trying to build an active community within the leads and we’ve found smaller equals better; fewer people coming together and taking deeper accountability,” Fagnan said.

Spearhead leads can invest their capital in any tech startups, so long as there’s no existing equity relationship. Existing Spearhead investments include ZeroDown, Altitude Networks, Scythe, Airgarage, Cloosiv, Height, O.School, PopSQL, Superplastic and Sword Health.

Categories: Business News

Headless CMS company Strapi raises $4 million

Startup News - 15 hours 37 min ago

French startup Strapi has raised a $4 million seed round led by Accel and Stride.vc. The company has been working on an open-source Node.js headless content management system.

That’s a lot of technical words in a row, but it’s not that hard to understand what Strapi is. Content management systems, or CMS, are web applications that let you publish and manage content on a website. It can be a blog, a corporate website with multiple pages, a portfolio, etc. The most popular CMS in the world is WordPress.

Over the past few years, many companies and developers have started to separate the CMS back end (the administration pages where you write and upload content) and the front end (the public website accessible to anyone).

This way, you can run a CMS in the back end, and develop your own custom front end that queries the back end using API calls — this is what’s called a headless CMS. It provides a ton of flexibility and should make your website faster. This is how TechCrunch.com works for instance, with WordPress running as a headless CMS.

Strapi has become quite popular in the headless CMS space, with 500,000 downloads and 250 contributors to the open-source project. The first version was released on GitHub in 2015.

Anybody can download Strapi and run it on their own server. You can then develop your front end, fetch content in your mobile app using the Strapi API and more. Strapi lets you customize the admin panel so that you only see the fields you need when you add content. It works with SQLite, MongoDB, MySQL and Postgres databases.

The company plans to build an ecosystem of plugins to expand the features of your CMS installation. Eventually, the startup could launch a hosted version of Strapi so you don’t have to manage the server infrastructure yourself.

Solomon Hykes, Guillermo Rauch and Eli Collins are also participating in today’s round. Existing investors include Bpifrance, SGPA, François-Charles Debeunne, Jean-Philippe Bellaiche, Kima Ventures, Nicolas Debock, Patrick Dalsace and Nicolas Rosset.

Categories: Business News

8 tips for founders trying to raise their first round of venture capital

Startup News - 2019, October 15 - 10:06pm

If you’re an avid TechCrunch reader, someone who loves to absorb endless startup profiles and pore through fundraising stories, you might think raising venture capital is easy. In reality, it’s very, very difficult and not the best source of capital for most businesses.

For startups hoping to scale far and wide as fast as possible, VC may be the right fit. To shed light on the process of raising equity capital from venture capital firms and provide some exclusive tips and tricks for Extra Crunch subscribers, we sat down with three experts on the subject. Below are the top pieces of advice from Charles Hudson, founder and managing partner of Precursor Ventures, Redpoint Ventures general partner Annie Kadavy, and DocSend founder Russ Heddleston. The following has been lightly edited for length and clarity.

1. First, make sure your company is fit to raise venture capital.

Charles Hudson: I think venture capital, it’s really a specialty type of capital. It’s really for companies that have the aspiration to grow really quickly, to build really large businesses … If you’re not a company that needs to grow quickly, venture capital might not be the right source of capital for you. There has to be a really big prize at the end of the journey.

2. Raise capital early if you’re stressing about small costs or fretting competition

Russ Heddleston: If you’re thinking about whether or not to raise, there are a couple of reasons that I will often advise people to raise early. One is if they’re really stressing about buying a whiteboard for their office, or like some something of relatively small cost. If you think it could be a big company, and you’re stressing about small things, raise money and buy the whiteboard, hire the additional person and get back to what you should be doing, which is running your business and growing it quickly.

The other thing is if you ask the question, ‘is there a competitor I don’t know about?’ If you heard tomorrow, that competitor just raised $2 million, or $5 million or $10 million, how nervous would that make you? For some businesses, you’re like, I don’t really care, it’s a services industry, it’s not a winner take all market. And other times, you’re like, oh, I’d be really nervous. So if either those apply, that’s a good reason to make a compelling case to someone like Charles.

The number one thing you can do to get a VC’s attention is make [your pitch] really simple. Precursor Ventures' Charles Hudson

3. It’s OK to take a salary

Annie Kadavy: I’d be hard-pressed to think of an example where a founder is not paying themselves, the question, though, is how much? You’re paying yourself enough so that the basic costs of life and running your business are not giving you anxiety, because as an early stage investor one of our primary roles is to try and keep the baseline stress as low as it can be, because it’s really hard to go build a company.

If a founder is coming in at the Series A and they say I’m going to go pay myself $300,000, we might be like, well, that doesn’t really feel right, shouldn’t you want to put some of that money into the company? The ranges I’ve seen are anything from $60,000 up to probably $120,000 at the Series A, or maybe $150,000. Then, as the company grows and as the balance sheet grows and it’s de-risked, your salary as an executive at the company will scale with that.

Categories: Business News

Interior design startup Havenly raises $32 million

Startup News - 2019, October 15 - 10:00pm

Interior design platform Havenly is raising $32 million in new funding to create its first private label brand as the startup aims to integrate its own products into its design recommendation engine.

The Denver-based startup is an online interior design consultancy of sorts that pairs with expert designers users looking to redesign their homes or apartments.

For Havenly, there have been two sides of the business, commercial partnerships with vendors and the paid design services for users. It’s a model we’ve also seen from the folks at Modsy. Havenly puts a bit more of an emphasis on pairing users with an individual designer with whom they can chat on the phone and share their hopes for the space, something CEO Lee Mayer says can help make the space feel more customized to them.

“Your home is very personal, if you and I show up to work one day and we have the same shirt, that may not be that weird. It is a little weird if I walk into your living room and it looks exactly like mine,” Mayer tells TechCrunch.

The big evolution with this raise will be that Havenly is going to start putting its own products into the mix with a private label called Cove Goods. The line largely seems to be focused on accent pieces, but they are working on some furniture as well.

Pricing for their services sits between $69 and $99 depending on whether you’re starting from a blank slate or just want some additional pieces recommended to you that you can buy through the platform. The startup can also send you custom floor plans and layout renders to show you what your space will look like.

Havenly has now raised $57.8 million. Series C investors included Foundry Group, Lerer Hippeau, Kickstart Ventures and Gingerbread Capital.

Modsy scores $37M to virtually redesign your home

 

Categories: Business News

Ex-Uber exec launches startup to autonomously reposition electric scooters and bikes

Startup News - 2019, October 15 - 10:00pm

Just how Android is the operating system for a number of mobile phones, Tortoise wants to be the operating system for micromobility vehicles, its co-founder Dmitry Shevelenko, who previously served as Uber’s director of business development, told TechCrunch. Given the volume of micromobility operators in the space today, Tortoise aims to make it easier for these companies to more strategically deploy their respective vehicles and reposition them when needed.

Using autonomous technology in tandem with remote human intervention, Tortoise’s software enables operators to remotely relocate their scooters and bikes to places where riders need them, or, where operators need them to be recharged. On an empty sidewalk, Tortoise may employ autonomous technologies while it may rely on humans to remotely control the vehicle on a highly trafficked city block.

“There are big daily operating expenses with the repositioning of scooters using cars and vans,” Shevelenko said. “Not only is that very expensive, but it ends up undoing a lot of the environmental benefit of shared electric scooters.”

In order for this to work, Tortoise partners with both cities and operators — though the city partnership needs to happen first, Shevelenko said. That’s because Tortoise will only reposition the vehicles along routes that the city has pre-approved.

“We only want to deploy in cities that want this and have given us written permission,” Shevelenko said. “If the cities say yes, then the operators say yes.”

For the operators, they’ll need to install about $100 worth of equipment on each scooter in order to run Tortoise’s software. That includes two phone cameras, a piece of radar, a processor and a motor. If it’s a two-wheeled vehicle, Tortoise requires the addition of robotic training wheels. All of this is included in the reference design Tortoise provides to operators.

Tortoise on top of a YIMI A80 scooter

“In the same way Google helps Samsung make its phones work with the latest version of Android, it’s in our interest that people build vehicles that are compatible with Tortoise,” Shevelenko said. “We also consult with OEMs and help them with their testing.”

Tortoise is currently focused on suburban environments, but would like to make this work in cities like San Francisco, as well. For the initial pilot deployment, Tortoise is retrofitting existing scooters with robotic training wheels. In rider mode, those wheels are up, but in autonomy mode, it’s wheels down.

Tortoise envisions three general use cases for repositioning. The first is reparking the scooter in a higher-trafficked area immediately after a rider trip is complete. The second is implementing digital scooter stops of sorts where riders can request a scooter to go there. The third is the Uber-Lyft experience where the scooter goes directly to you, wherever you are.

“The key to making that third use-case work is having enough scooters so that the ETA is predictable and accurate,” Shevelenko said.

While the software will ultimately rely on the battery capabilities of the vehicles, Shevelenko said most of the battery consumption happens when there is a rider on the vehicle. Because Tortoise will only reposition them without riders present, it will consume very little of the battery, Shevelenko said.

“Assuming eight repositions a day using our technology at 30 minutes each, that only takes up about 10% of a daily charge,” he said. “Even if that weren’t the case, as operators switch to swappable batteries, if you’re getting more rentals per day because of repositioning based on demand, you could just drive it to a location where it’s close to a swappable battery location.”

Tortoise tech in action in Peachtree Corners

As business and mobility analyst Horace Dediu recently told me, these micromobility vehicles have an opportunity to also be software hubs. In fact, he said it’s where he expects bigger players like Google and Apple to enter the space. So far, Tortoise has partnered with Peachtree Corners, Ga. to demonstrate its software at Atlanta Tech Park. It’s also working with operators and manufacturers like Wind, CityBee, Go X and Shared to deploy Tortoise in their respective markets.

Wind, which operates in countries like Denmark, France, Spain and Germany, sees Tortoise as a natural fit, its EMEA CEO Ed Schmidt said in a statement.

“It will allow us to keep sidewalks clear and safe for pedestrians while delivering on our mission to always have a scooter within a 2 minute walk of a user ready to take a ride,” he said. “This technology will enable us to provide the best mobility service for our users and the city authorities.”

Tortoise is not the only company to explore adding autonomous technology to micromobility vehicles. In January, Uber spoke about a micromobility robotics team that would explore autonomous scooters and bikes that could drive themselves to be charged, or drive themselves to locations where riders need them. Last month, Uber revealed a bit more about its New Mobility Robotics team that would explore sensing and robotics for light electric vehicles. That entails features like sidewalk detection and, down the road, automatic repositioning of scooters, Uber Head of New Mobility Robotics Alan Wells told TechCrunch.

“That makes sense for a number of reasons,” Wells said of automatic repositioning. “It has a possibility of addressing some of the biggest downsides of where do you park them and also make them convenient for riders without being a burden to other people.”

Tortoise has raised some funding, but is declining to disclose the amount and specific investors.

Defining micromobility and its potential to be bigger than autonomous vehicles

Categories: Business News

Brooklyn-based construction robotics startup Toggle gets $3M seed fund

Startup News - 2019, October 15 - 9:30pm

Toggle, a Brooklyn-based robotics startup, announced today that it scored $3 million in seed funding. The early-stage round was led by Point72 Ventures’ AI Group, with participation from Mark Cuban and VC Twenty Seven Ventures. The series follows a 2018 pre-seed round of $570,000 from its Urban-X accelerator, Urban Us, Accelerate NY / Empire State Development and Perl Street Capital.

The 15-person startup creates robotics that fabricate and assemble rebar. It’s designed to work in tandem with existing robotics and steel fabrication technologies, while speeding up the process up to 5 times, by the company’s count.

Toggle has already begun a soft launch “for a wide range of projects in New York City and the surrounding area,” according to the company. It expects to ramp up toward commercial production over the course of the next year and a half. CEO Daniel Blank tells TechCrunch that the seed round will be used toward R&D and growing the Toggle team.

“This funding will be used to further develop our technology — both the hardware and software — around assembly and fabrication automation, as well as grow the engineering team that supports this development,” Blank tells TechCrunch. “The funding also provides us with a strong foundation for our manufacturing operation which is already supplying services and materials to customers in New York City and the surrounding region.”

Categories: Business News

Algolia finds $110M from Accel and Salesforce for its search-as-a-service, used by Slack, Twitch and 8K others

Startup News - 2019, October 15 - 8:02pm

Algolia, one of the group of startups that provides search as a service for websites and apps as an alternative to Google and other search engines, is announcing a major round of funding today to fuel its growth. The startup — which already has more than 8,000 customers, including big names like Twitch, Slack, Discovery and LVMH — has closed a Series C of $110 million, money it plans to invest in R&D around its search technology, including doubling down on voice, and further global expansion in Europe, North America and Asia Pacific.

This Series C is being led by Accel, with other investors in this round including Salesforce Ventures (along with others that are not being named).

The funding is coming at a time of strong growth for Algolia, whose basic premise — to offer an easy-to-use, API-based search service for businesses, as a way to buy search tech rather than build from the ground up using search platforms — has seen a lot of traction.

It was already active in the various regions where it plans to grow: Founded originally in France, Algolia is now based out of San Francisco and has been in Asia since 2014, most recently doubling down on business in Japan, and when it last raised money in June 2017, it had only 3,000 customers.

Algolia had raised $74 million prior to this, with previous investors including Accel, Point Nine Capital, Storm Ventures, Y Combinator, 500 Startups and a number of individuals, among others.

While Algolia is not disclosing its valuation, the prospects for building a big, enterprise-focused search business are there. As a point of comparison, consider the enterprise search company Elastic, which went public in 2018 and now has a market cap of some $6.7 billion after being valued at a mere $700 million when it was still private. Even with 8,000 customers now at Algolia, this is just the tip of the iceberg: Algolia cites estimates that there are some 1.8 billion websites and millions of apps on the market today.

Having Salesforce as a strategic backer in this round is notable, as the CRM giant currently does not have a native search product in its wide range of cloud-based services for enterprises, instead opting for endorsed integrations with third parties, such as Algolia competitor Coveo. The plan will be to further integrate with Salesforce, although there are no products to speak of as of yet.

“Algolia has been a great search innovator and delivers unique experiences for customers across Commerce,” said Mike Micucci, CEO, Salesforce Commerce Cloud. “Algolia’s integration into the Commerce Cloud platform will continue to drive momentum and mutual success with our developer, partner and customer community.”

At a time when search continues to be a critical cornerstone for how an organization presents itself online, and the effort to provide a counterbalance against the power of Google in search continues apace, this essentially gives Salesforce a financial foothold in one of the faster-growing companies in the space.

As my colleague Romain has previously noted in his coverage of Algolia, the company’s unique selling point has been the fact that it provides a super-fast and effective search tool that you can integrate into a site or app easily by way of an API.

This in contrast to solutions that either are built in-house from the ground up, or rely on more lengthy and more expensive integrations to get up and running. Alongside that, Algolia has more recently released supplementary tools, such as search analytics and A/B testing to help optimise results and understand better what it is that site/app visitors want to know.

The funding comes at an interesting time in the world of search. Google has effectively dominated the market for years with an open web approach to ordering the world’s information: the primary point of entry is Google.com, and while you can tailor your results based on your search terms, the selling point is that you can search for anything and everything.

But in more recent years we’ve seen a big shift. Awareness of issues such as privacy and data protection have turned some off from the idea of open-ended browsing powered by advertising, and as we and the internet itself has gotten more sophisticated, sometimes the open-ended search feels too wide for our purposes, and web publishers themselves are less inclined to give over that search traffic to Google.

That’s given rise to more focused vertical search services, and — even more specifically — better search within sites and apps themselves. This is the context that has given rise to Algolia and others like it (for example Lucidworks raised $100 million in August).

The landscape is big, but it remains one that Algolia thinks best served by staying focused.

“We have no plans to build a consumer service,” CEO Nicolas Dessaigne said. “There are a lot of companies like Amazon and Google doing a great job. We like to think of them as partners in a way, educating the whole world about search.”

“Behind a world-class team of search experts and a passionate customer base, Algolia has become the market leader in Search-as-a-Service,” said Nate Niparko, partner at Accel. “Algolia is accelerating innovation in personalized and intelligent search, enabling companies to deliver a great user experience that drives improved business results. We are excited to double down on Algolia and support their mission to lead the search and discovery market.”

Categories: Business News

Newly rebranded Thimble raises $22M to bring flexible insurance to the gig economy

Startup News - 2019, October 15 - 7:00pm

Thimble, which offers flexible, short-term insurance to small businesses and freelancers, is announcing that it has raised $22 million in a Series A funding round led by IAC.

Until today, the startup was known as Verifly, a name tied to the company’s initial aim of providing insurance to drone pilots. However, founder and CEO Jay Bregman (who previously founded ridesharing company Hailo) said that thanks to customer demand, the team kept adding insurance for different types of businesses — and now it’s rebranding to reflect that broader vision.

While it’s easy to talk about Thimble customers as being part of the “gig economy,” Bregman noted that these aren’t just people driving for Uber or delivering for Postmates — only 4% of the company’s customers identify as gig economy workers.

“There is this larger thing called the gig economy: People working in flexible ways, on their own terms,” he said.

In fact, Thimble now says it provides liability coverage for customers in more than 100 professions, including handymen, landscapers, DJs, musicians, beauticians and dog walkers. Policies can be purchased directly from the Thimble website or app by the hour, day, week, month or year.

The idea, Bregman said, is that as work becomes shorter term and “more transactional,” it doesn’t make sense to buy an annual insurance policy. To illustrate that point, he noted that 75% of customers didn’t have insurance before buying from Thimble, and that 50% of customers are buying policies to cover a single day or less. And the company says it’s on track to sell 100,000 by the end of the year.

Thimble’s policies are underwritten by Markel, an insurance company that Bregman praised for its “infrastructure and talent.”

At the same time, he said, “We have always been the owner of the product itself. Basically, we worked with carrier partners to bring [our products] to market; the way we do that may evolve slightly as we get older and more mature.”

Thimble has received regulatory approval to sell insurance in 48 states so far. Asked whether the broader political debates about whether gig workers are employees could affect the company’s business, Bregman pointed again to the fact that the vast majority of Thimble customers don’t consider themselves gig workers.

“Our only fear here is that in trying to solve a very particular problem with long-term gig employment, that some of these laws may actually unintentionally scare off or capture legitimate freelancers,” he said.

As for the investment, IAC’s chief strategy officer Mark Stein acknowledged that the digital media holding company doesn’t make many early-stage, minority investments. But he said that deals like this are about “planting seeds.”

“What we think about at IAC is: How can we go about planting seeds of growth for the future? What will become the next ANGI Homeservices? What will become the next Match Group?” Stein said, alluding to two IAC-owned businesses that may get spun off. “We need to find these kinds of large, addressable market opportunities now in the hopes of creating very large, industry-changing companies in the future.”

Previous investors Slow Ventures, AXA Venture Partners and Open Ocean also participated in the round, bringing Thimble’s total funding to $29 million.

Verifly launches a business insurance product for gig economy workers

Categories: Business News

Smart home startup Level Home emerges from stealth with $71M and a new take on the smart lock

Startup News - 2019, October 15 - 6:31pm

As companies like Google, Amazon and Apple hone their strategies to build the brain that helps you use the smart home of the future, where a new wave of internet-enabled appliances, climate and security systems and other connected objects can be connected and controlled through their hubs, a new smart home startup called Level Home is emerging from stealth today with a big packet of funding and a hope of bringing something new to the table, by focusing on ways of rethinking old things you own already, starting with the lock on your front door.

The Level Lock, the first patented product, is a system — tested for durability, powered by a basic CR2 battery (average life: one year), equipped with ANSI GRADE 1/A security and encryption — that is fitted into the existing dead bolt on your door to make it “smart”. Level Home says you can install the Lock yourself using a basic number two scredriver — “the most common tool in the American home”, says CEO and co-founder John Martin — or you can engage Level Home’s installation partner, HelloTech, to set it up.

The key thing with the Level Lock is that you door will not look any different after you install it. But linking it up with HomeKit, you can then use an Apple iPhone or Watch to unlock it (or, you can also still use the physical keys that come with the lock to open the door). Through the app, you can then also provide one-off or repeat access to others and monitor who comes and goes.

Priced at $249 when it goes on sale (first in the US), the Lock is available now for preorder on Level Home’s site. But there is a good chance that when the Lock does become generally available, you will be able to get it in more places beyond Level’s site.

That’s because, along with the launch of the Level Lock and the company itself, Level Home is also announcing that it has raised $71 million in funding in the years that it has been in stealth, with investors including a firm called Hut 8 Ventures (unclear if connected to Hut 8 cryptocurrency mining, I’m asking), Lennar Homes — the home maker that has worked with the likes of Apple and Amazon to build in connected features into new properties — and Walmart.

The retail giant has been working double time to “level up” to Amazon on the e-commerce front, building a range of services online and increasing the ways in which it can connect with shoppers beyond visits to its large retail locations, and while Level is not disclosing any details yet on how it will work with its strategic investors, you could imagine its involvement having more than one touchpoint.

It could be a very strong sales channel for the Level Lock through its many well-visited retail locations.

But it could also be sold potentially as part of a bigger service offering, in competition with something like Amazon Key, where Walmart offers smart locks to its customers as part of a bigger home delivery business. (Walmart has already started down this road: back in 2017 it first partnered with smart lock maker August to test in-home delivery.)

Partnerships with the likes of Walmart and Lennar sound like a big deal, considering that the company hasn’t tested its product or brand in the market, and the area of smart home hardware is also very crowded already.

Part of the reason for the leap may be because of the background of the founders. John Martin (CEO) and Ken Goto (CTO) have worked together for decades across a range of major tech and other consumer companies including Microsoft, Starbucks and Apple. Underneath them, they have assembled a wider team of about 50 of like-minded people to bring that vision into the physical world.

“Much of the current company are people from Google, Microsoft, and Facebook and others,” said Goto. “We have a shared level of talent and capability.”

To be very clear, Martin and Goto are very far from the image of young startup-hopefuls, Martin told me he didn’t even really like the term “startup.” Instead, the two are taking a measured and very confident approach to the bigger task of thinking about how to approach a new generation of hardware.

For them, it isn’t so much as “disrupting” what is already being used, as it is trying to augment it to bring in a wider population of adopters beyond those who embrace the cutting edge of tech.

“We could have made anything for the connected home, so and we thought for weeks about what to invent,” Martin told me about the pair’s decision to focus first on the front door lock three years ago. “We had a couple of fundamentals: we wanted products for everyday life, and we didn’t want home automation out of the mainline of what normally happens. We didn’t want lightbulbs to change color for the sake of it, and we didn’t want to appeal just to the tech professional. So we thought entry was the right point to start.” Or, you could say entry was a good point of entry.

Of course, Level Home isn’t the first to come on this progression of logic. Smart doors and smart locks are everywhere now, although ironically, they are not being used all that much.

“When we looked at first generation smart locks, we were offended by how aggressively the experience was departing from how people use locks today.” By this, Martin is referring to things like physical keys, or aesthetically pleasing doors and locks without large objects attached to them.

Indeed, the smart home market has not been a home run so far, but it shows some promise. The smart home market overall is projected to generate revenues of nearly $74 million this year, nearly doubling to $141 billion by 2023. A stream of hardware sales will underpin that growth, with some 140 million smart locks and other home security devices — the second-biggest category after video entertainment — expected to be shipped this year, growing to 352 million by 2023 globally.

But within that, penetration has not been massive: in Europe, only around 11 percent of homes have smart home devices in them (not counting phones), and in the US, the figure is only slightly higher, at 15%. That speaks to a still-nascent market, but also the fact that many people’s imaginations, and crucially wallets, have get to be captured by what is on offer today.

That spells opportunity for the smart home entrepreneurs, and investors willing to take the leap to back them.

Martin and Goto said that they have a pipeline of several other products that they will be working on, although for now, they are keeping quiet on what those might be. I’ve searched and can only so far find patents for the Lock system, but they tell me that the basic idea will be to continue present an alternative version of the smart home: to quietly make our lives at home easier and more connected, but without any massively perceptible shifts. Move slow, don’t break things.

In a market with a lot of options for how to bring more modern objects into the mix that genuinely look like the future, this could be a good differentiator.

“We’re pleased to make an investment in Level Home as they unveil their latest technology, the Level Lock,” said Ashley Hubka, Senior Vice President of Corporate Strategy, Development and Partnerships, Walmart, in a statement. “Smart technology products and home automation provide us with more opportunities to serve customers in new ways today and into the future.”

“Level Home’s unique approach and technology is a game changer for homebuilders,” said Eric Feder, Managing General Partner, Lennar Ventures, in a statement. “As one of the nation’s leading home builders, Lennar is founded on a long tradition of quality craftsmanship and attention to detail. The Level Lock will transform the smart lock category by allowing home builders to offer innovation without having to compromise on their home experience.”

Categories: Business News

True Balance raises $23M to bring its payments app to more small cities and towns in India

Startup News - 2019, October 15 - 4:04pm

South Korean startup True Balance, which operates an eponymous financial services app aimed at tens of millions of users in small cities and towns in India, has closed a new financing round as it looks to court more first-time users in the world’s second largest internet market.

True Balance said on Tuesday that it has raised $23 million in its Series C financing round from seven Korean investors — NH Investment & Securities, IBK Capital, D3 Jubilee Partners, SB Partners, Shinhan Capital and existing partners IMM Investment and HB Investment.

TechCrunch reported earlier this year that True Balance — which has raised $65 million to date, including the $38 million that it closed in its previous financing round — was looking to raise as much as $70 million in its Series C round.

True Balance began its life as a tool to help users easily find their mobile balance, or top up pre-pay mobile credit. But in its four-year journey, its ambition has significantly grown beyond that. Today, it serves as a digital wallet app that helps users pay their mobile and electricity bills, and offer credit to customers so that they can pay later for their digital purchases.

The startup says it has amassed more than 60 million registered users in India, most of whom live in small cities and towns — or dubbed India 2 and India 3. Most of these users are coming online for the first time and True Balance says it has an army of local agents — who get certain incentives — to help first-time internet users understand the benefit of online transactions and start using the app.

True Balance says it clocks more than 300,000 digital transactions on its app each day. The startup, which recently introduced e-commerce shopping services on its app to sell products like smartphones, has clocked $100 million in GMV sales in the country to date.

Charlie Lee, founder of True Balance, said the startup will use the fresh capital to bulk up the offerings on the app. Some of the features that True Balance intends to add before the end of this fiscal year include the ability to purchase bus and train tickets, digital gold and book cooking gas cylinders.

True Balance will also expand its lending and e-commerce services, Lee said. Its lending feature was used 1 million times in three months when it was introduced earlier this year. “We aim to strengthen our data and alternative credit scoring strategy to provide better financial services to our target — the next billion Indian users. Our goal is to reach 100 million digital touch points and become one of the top fintech companies in India by 2022,” he added in a statement.

Even as more than 600 million users in India are online today, just about as many remain offline. In recent years, many major companies in India have started to customize their services to appeal to users in India 2 and India 3 — who also have limited financial power.

Categories: Business News

South Korea-based Mathpresso, developer of tutoring app Qanda, raises $14.5 million Series B

Startup News - 2019, October 15 - 3:22pm

Seoul-based education technology startup Mathpresso announced today that it has raised $14.5 million in Series B funding. The company’s flagship app is Qanda, which provides students with math and science help and tutoring. Participants in the round include Legend Capital, InterVest, NP Investments and Mirae Asset Venture Investment.

This brings Mathpresso’s total funding so far to $21.2 million. Its previous round of funding was a $5.3 million Series A announced at the end of last year.

Mathpresso says Qanda (the name stands for “Q and A”) is currently used by a third of students in South Korea. The app launched in markets including Japan, Vietnam, Indonesia and Singapore last year and now has users in more than 50 countries. Qanda uses AI-based optical character recognition to scan math problems. Students take a photo of a problem and upload it to get instructions for how to solve it from the app or tutors.

In a statement, Legend Capital managing director Joon Sung Park said, “As an early investor of China’s leading mobile education companies such as Zuoyebang and Onion Math, Legend Capital has witnessed robust growth of China’s mobile education market. We strongly believe that Mathpresso has the technological and operation capabilities to expand overseas and grasp new opportunities emerging from the digitization of education, such as offering personalized learning for each student.”

Categories: Business News

Bird’s chief legal & policy officer is leaving the company

Startup News - 2019, October 15 - 9:35am

Bird, the $2.5 billion electric scooter business, is losing its chief legal and policy officer. David Estrada, who was hired last year from Kitty Hawk, is joining another mobility company, SoftBank-backed Nuro.

A spokesperson for Bird tells TechCrunch Estrada is leaving the Santa Monica-based company to be closer to his family. Nuro, for its part, is based in Mountain View, CA.

Bird’s former chief legal officer, David Estrada.

Estrada, who previously oversaw public policy at the electric aircraft company Kitty Hawk as its chief legal officer, has been responsible for Bird’s compliance and government relations efforts as the company scaled to over 100 global cities. Prior to joining Kitty Hawk, Estrada spent nearly two years as Lyft’s vice president of government relations and worked as the legal director for Google X, partnering with states on legislation around autonomous vehicles, Google Glass and drone delivery.

How Nuro plans to spend Softbank’s $940 million

Nuro, founded in June 2016, has emerged as a key player in the rapidly-expanding autonomous delivery sector. The company has attracted a whopping $1.03 billion in venture capital funding to date, according to Pitchbook. SoftBank funneled an astounding $940 million into the business earlier this year at an undisclosed valuation. In addition to SoftBank, Nuro is backed by Greylock and the Chinese venture capital firm Gaorong Capital.

The company has been developing a self-driving stack and combining it with a custom unmanned vehicle designed for last-mile delivery of local goods and services. It began piloting grocery delivery in 2018 in the Phoenix suburb of Scottsdale.

Bird has overcome a number of unique hurdles with many more afoot, including pushback from local governments who were aggravated by the sudden appearance of hundreds of scooters. At Nuro, Estrada will have the opportunity to focus on the future of unmanned delivery, another sector faced with regulatory challenges and political barriers.

Bird raises $275 million Series D round at a $2.5 billion valuation

Categories: Business News

WeWork pulls thousands of phone booths out of service over formaldehyde scare

Startup News - 2019, October 15 - 5:04am

WeWork, the co-working empire once valued at $47 billion before reality struck, plunging the business and its investors into crisis, has another problem to add to its growing pile — one which doesn’t exactly reflect well on its core business of kitting out and maintaining modern working environments.

The problem is a safety concern affecting users of WeWork co-working spaces in the U.S. and Canada. Today the company emailed members in the regions to warn that around 1,600 phone booths installed at WeWork locations have been found to have elevated levels of formaldehyde — which it warns could cause health issues for people exposed to the gas.

WeWork blames the issue on a manufacturer of the booths.

The booths are provided in its co-working spaces for WeWork members to be able to take calls in private — given other common areas are shared by all users. 

“After a member informed us of odor and eye irritation, WeWork performed an analysis, including having an outside consultant conduct a series of tests on a sampling of phone booths. Upon receiving results late last week, we began to take all potentially impacted phone booths out of service,” it writes in an email to members.

Affected phone booths “are being taken out of service immediately, and will be removed from your location as soon as possible,” it adds. 

In addition to ~1,600 booths it has confirmed are affected, a further 700 booths are being taken out of service in what WeWork describes as “an abundance of caution” — i.e. while it carries out more checks — with the promise of a further update once it has concluded its tests. 

Members wanting to know which booths are safe to use in the meanwhile are told to contact the community team at their WeWork location.

WeWork also says alternative quiet spaces will be provided, such as in conference rooms and unused offices. 

Discussing the health risks of formaldehyde gas — a chemical which is used in various building materials –WeWork’s email warns: “Short-term exposure to formaldehyde at elevated levels may cause acute temporary irritation of the nose, throat, and respiratory system, including coughing or wheezing. These effects are typically transient and usually subside after removal of the formaldehyde source.

“Long-term exposure to formaldehyde, such as that experienced by workers in jobs who experience high concentrations over many years, has been associated with certain types of cancers. You can find additional information in this FAQ from the Occupational Safety and Health Administration.”

The email encourages any WeWork members with health concerns to contact a doctor.

A tipster who sent us the email reported experiencing a sensation of “burning eyes” after using the booths.

They also said several people in their team had experienced the same issue.

“Some complained that they felt nauseous after spending time inside the booths,” the tipster wrote. “I never felt that, but the burning eyes was 100% there for me several times. Scary stuff.”

Reached for comment, a WeWork spokesperson confirmed the formaldehyde issue, saying it’s taking “a number” of booths out of service at “some” locations in the U.S. and Canada — due to “potentially elevated levels of formaldehyde caused by the manufacturer.”

“The safety and well-being of our members is our top priority, and we are working to remedy this situation as quickly as possible,” it adds in a statement.

It is not clear exactly how many WeWork locations contain affected booths at this point.

Nor has WeWork provided more detailed information about how long members might have been exposed to elevated levels of formaldehyde — with its email merely suggesting some of the booths have been in place for “months.” 

“The potentially impacted phone booths have been installed over the past few months, exact timing varies based on location,” it writes.

Although clearly the level of exposure will vary from person to person depending on their use of the booths.

The company did not respond to a question asking whether any of its international WeWork locations are affected by the issue.

Categories: Business News

Founder’s guide to the pre-IPO secondary market

Startup News - 2019, October 15 - 1:57am
Ryan Conner Contributor Share on Twitter Ryan Conner is a corporate attorney at Atrium part of the General Counsel Group representing early-stage startups.

The increase in activity in the pre-IPO secondary market means that founders, early employees, and investors are receiving liquidity much sooner in a company’s lifecycle than ever before. For most startups and privately held companies, liquidity is often an issue for stockholders as no market exists for selling shares and/or transfer restrictions prevent their sale. Secondary stock transactions, however, are a way to work around this problem.

Here’s a quick look at how they work and what to keep in mind, especially if you’re going through the process for the first time. (If you’re not familiar, secondaries are transactions in which an existing stockholder sells their stock for cash to third parties or back to the company itself before the company undergoes an exit; traditionally, an exit refers to an M&A or an IPO.)

Offering secondary transactions to founders is a tool VCs have been using to win deals. For example, if a VC promises that the founders will receive $1,000,000 in cash through a secondary sale from a $15,000,000 venture financing round, the founders will likely prefer that VC’s term sheet to a term sheet from a VC that does not offer that deal.

Why would a founder consider a secondary sale of their equity?

Categories: Business News

DoorDash opens a shared kitchen in Redwood City

Startup News - 2019, October 14 - 11:02pm

DoorDash is opening its first shared commissary kitchen in Redwood City, Calif., bringing new delivery and pickup options to customers in Peninsula towns, including Atherton, Menlo Park and Palo Alto.

This is part of a broader trend of companies like Deliveroo opening shared kitchens that allow restaurant partners to expand their delivery footprint without dealing with all the expenses of opening a new location.

DoorDash says this first kitchen will be used by restaurants including Nation’s Giant Hamburgers, Rooster & Rice, Humphry Slocombe and The Halal Guys.

The company also says it designs the kitchen spaces in collaboration with its partners, and argues that by putting all these restaurants together in one location, it can offer unique menu items and pairings — at launch, if you order from Rooster & Rice, you can add Humphry Slocombe ice cream pints to your order.

“Given our founders’ Bay Area roots, we are always interested in how technology can change the way food is delivered and shared,” said Rooster & Rice CFO Min Park in a statement. “We were impressed by the overall partnership and scale DoorDash could reach with this concept, and we found the notion of a delivery-only kitchen in Redwood City very appealing as it helps us test out demand in new markets, reaching new customers and areas quickly.”

As part of the launch, the company says it will offer 0% delivery fees to its DoorDash Kitchens partners through the end of the year.

DoorDash, now valued at $12.6B, shoots for the moon

Categories: Business News

Opendoor appoints CFO, CPO

Startup News - 2019, October 14 - 10:00pm

Opendoor has named Gautam Gupta its chief financial officer and chief business officer, critical roles as the business continues to alter the way in which homes are bought and sold. Uber’s former head of finance, Gupta joined the $3.8 billion home-selling platform as its chief operating officer in 2017.

The company, which has raised more than $4 billion in debt and equity funding to date, is announcing several new hires this morning. Venrock’s Tom Willerer has joined as the company’s first-ever chief product officer. Willerer previously led product at Coursera and Netflix. He joined the Silicon Valley venture capital firm Venrock in 2017 and has since struck deals with edtech startups including Make School and Flockjay.

Opendoor has also hired Julie Todaro as its president of homes and services, another newly created role. Todaro, who spent more than a decade at Amazon, most recently as its vice president of consumer electronics, will oversee market operations, customer experience and home services.

Finally, Carrie Wheeler, a partner at TPG for 20 years, and Jason Kilar, the founding CEO of Hulu, have joined Opendoor’s board of directors.

Founded in 2014, San Francisco-based Opendoor is backed by General Atlantic, Hawk Equity, SoftBank, Access Technology Ventures, Lennar Corporation, Fifth Wall Ventures, SV Angel, Norwest Venture Partners, NEA, GGV Capital, Khosla Ventures, GV and more.

Opendoor raises $300M on a $3.8B valuation for its home marketplace

Categories: Business News

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