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Amid controversy, Dispo confirms Series A funding, high-profile advisors, and investors

By Amanda Silberling

It’s only been nine months since Dispo rebranded from David’s Disposables. But the vintage-inspired photo sharing app has experienced a whiplash of ups and downs, mostly due to the brand’s original namesake, YouTuber David Dobrik.

Like Clubhouse, Dispo was one of this year’s most hyped up new social apps, requiring an invite from an existing member to join. On March 9, when the company said “goodbye waitlist” and opened the app up to any iOS user, Dispo looked poised to be a worthy competitor to photo-sharing behemoths like Instagram. But, just one week later, Business Insider reported on sexual assault allegations regarding a member of Vlog Squad, a YouTube prank ensemble headed by Dispo co-founder David Dobrik. Dobrik had posted a now-deleted vlog about the night of the alleged assault, joking, “we’re all going to jail” at the end of the video.

It was only after venture capital firm Spark Capital decided to “sever all ties” with Dispo that Dobrik stepped down from the company board. In a statement made to TechCrunch at the time, Dispo said, “Dispo’s team, product, and most importantly — our community — stand for building a diverse, inclusive and empowering world.”

Dispo capitalizes on Gen Z and young millennial nostalgia for a time before digital photography, when we couldn’t take thirty selfies before choosing which one to post. On Dispo, when you take a photo, you have to wait until 9 AM the following day for the image to “develop,” and only then can you view and share it.

In both February and March of this year, the app hit the top ten of the Photo & Video category in the U.S. App Store. Despite the backlash against Dobrik, which resulted in the app’s product page being bombarded with negative comments, the app still hit the top ten in Germany, Japan, and Brazil, according to their press release. Dispo reportedly has not yet expended any international marketing resources.

Now, early investors in Dispo like Spark Capital, Seven Seven Six, and Unshackled have committed to donate any potential profits from their investment in the app to organizations working with survivors of sexual assault. Though Axios reported the app’s $20M Series A funding news in February, Dispo put out a press release this morning confirming the financing event. Though they intend to donate profits from the app, Seven Seven Six and Unshackled Ventures remain listed as investors, but Spark Capital is not. Other notable names involved in the project include high-profile photographers like Annie Leibovitz and Raven B. Varona, who has worked with artists like Beyoncé and Jay-Z. Actresses Cara Delevingne and Sofía Vergara, as well as NBA superstars Kevin Durant and Andre Iguodala, are also involved with the app as investors or advisors.

Dobrik’s role in the company was largely as a marketer – CEO Daniel Liss co-founded the app with Dobrik and has been leading the team since the beginning. After Dobrik’s departure, the Dispo team – which remains under twenty members strong – took a break from communications and product updates on the app. It’s expected that after today’s funding confirmation, the app will continue to roll out updates.

Dispo is quick to shift focus to the work of their team, which they call “some of the most talented, diverse leaders in consumer tech.” With the capital from this funding round, they hope to hire more staff to become more competitive with major social media apps with expansive teams, like Instagram and TikTok, and to experiment with machine learning. They will also likely have some serious marketing to do, now that their attempt at influencer marketing has failed massively.

Now more than ever, Dispo is promoting the app as a mental health benefit, hoping to shift the tide away from manufactured perfectionism toward more authentic social media experiences.

“A new era of start ups must emerge to end the scourge of big tech’s destruction of our political fabric and willful ignorance of its impact on body dysmorphia and mental health,” CEO Daniel Liss writes in a Substack post titled Dispo 2.0. “Imagine a world where Dispo is the social network of choice for every teen and college student in the world. How different a world would that be?”

But, for an app that propelled to success off the fame of a YouTuber with a history of less than savory behavior, that messaging might fall flat.

According to Sensor Tower, the highest Dispo has ever ranked in the Photo & Video category on the U.S. App Store was in January 2020, when it was still called David’s Disposables. The app ranked No. 1 in that category from January 7 to January 9, and on January 8, it reached No. 1 among all free iPhone apps.

5 Reasons you need to attend TC Sessions: Mobility 2021

By Alexandra Ames

Get ready to spend a full day rubbing virtual elbows with the global mobility community’s best and brightest minds and makers. TC Sessions: Mobility 2021 takes place June 9, and we’ve packed the agenda with experts, interviews, demos, panel discussions, breakout sessions and a metric ton of opportunity.

Pro tip: It’s not too late to book a ticket. Grab yours here and save with groups of 4+.

If you’re still on the fence, here are five excellent reasons you should attend TC Sessions: Mobility 2020.

Leading Voices
TC Sessions: Mobility represents a broad range of companies and topics within the mobility space.

Want to know what’s happening in self-driving delivery? We’ve got Ahti Heinla (CTO @ Starship), Apeksha Kumavat (Co-Founder @ Gatik), & Amy Jones Satrom (Head of Ops. @ Nuro).

Want to get the low-down on Commuter Cars? We’re talking with Jesse Levinson (Co-Founder & CTO @ Zoox).

Want to see what’s in the future for passenger aircraft? Then you’ll definitely want to watch the session with JoeBen Bevirt (Founder @ Joby Aviation) and Reid Hoffman (Co-Director @ Reinvent Technology Partners)

Check out the full agenda here.

Trendspotting

Mobility is a fast-moving target, and success depends on a company’s or individual’s ability to spot possibilities before they become mainstream. At TC Sessions: Mobility you’ll meet with exhibitors, founders, and leaders to figure out what’s coming next.  Here’s what our attendees are saying:

“Attending TC Sessions: Mobility helps us keep an eye on what’s coming around the corner. It uncovers crucial trends so we can identify what we should be thinking about before anyone else.”
— Jeff Johnson, vice president of enterprise sales and solutions at FlashParking.

1 on 1 Global Networking

At TC Sessions: Mobility you can take advantage of CrunchMatch, our free, AI-powered networking platform (think speed dating for techies) makes connecting with like-minded attendees quick and painless — no matter where they’re located. A virtual conference means global participation, and you might just find your next customer, partner, investor or engineer living on a different continent. It takes only one connection to move your business forward.

Early Stage Expo & Pitch

30 early-stage startups will showcase their mobility tech in our virtual expo. Peruse the exhibitors, peek at their pitch decks, schedule a demo, start a conversation and see where it leads. During the show, you can also check out the pitch sessions where startups will present their company to a panel of TechCrunch editors.

TC Sessions: Mobility on June 9 is sure to be a blast and a great opportunity for you to expand your knowledge and network within the mobility industry. Book your tickets today as prices go up at the door. 

Erase All Kittens raises $1M Seed round for Mario-style game which teaches girls to code

By Mike Butcher

Erase All Kittens (EAK) is an EdTech startup that created a ‘Mario-style’ web-based game designed for kids aged 8-12. However, the game has a twist: it places an emphasis on inspiring girls to code (since let’s face it, most coding tools are created by men). After reaching 160,000 players in over 100 countries, it’s now raised a $1M Seed funding led by Twinkl Educational Publishing, with participation from first investor Christian Reyntjens of the A Black Square family office, alongside angel investors, including one of the founders of Shazam.

While the existing EAK game is free, a new game launched in July will be paid for, further boosting the product’s business model.

EAK says its research shows that some 55% of its players are girls, and 95% want to learn more about coding after playing its game. EAK is currently being used in over 3,000 schools, mostly in the UK and US, and its traction increased by 500% during the lockdowns associated with the pandemic.

It’s Erase All Kittens’ contention that coding education tools for children have been largely built by men and so naturally appeal more to boys. With most teaching repetitive coding, in a very rigid, instructional way, it tends to appeal more to boys than girls, says EAK.

The female-founded team has a platform for changing the perception that kids, especially girls, have of coding. After R&D of two years, it came up with a game designed to teach kids and girls as young as 8 skills such as HTML, CSS, and Javascript in a highly gamified, story-driven gameplay. Kids get to chat with characters on their journey, for example, a serial entrepreneur unicorn mermaid called Tarquin Glitterquiff.

“Players edit the code that governs the game environment, building and fixing levels as they play in order to save kittens in a fantasy internet universe,” said cofounder Dee Saigal, co-founder, CEO and creative director. Saigal is joined by co-founder Leonie Van Der Linde; CTO Rex Van Der Spuy; Senior Games Developer Jeremy Keen; and 2D Games Artist Mikhail Malkin.

The existing game teaches HTML skills and how to create URLs, and the new game (released in July this year) will teach HTML, CSS, and Javascript skills – bridging the huge gap between kids learning the concepts and being able to create on the web like developers.

Said Saigal: “We’re designing a coding game that girls genuinely love – one that places a huge emphasis on creativity. Girls can see instant results as they code, there are different ways to progress through the game, and learning is seamlessly blended with storytelling.”

Saigal said: “When I was younger I wanted to be a games designer. I loved coming up with ideas for games but coding had always seemed like an impossible task. We weren’t taught coding at school, and I couldn’t see anyone who looked like me making games, so I didn’t think it was something I could do.”

“Whilst researching our target audience, we found that one of the biggest obstacles for girls still begins with gender stereotypes from an early age. By the time girls reach school, this snowballs into a lack of confidence in STEM skills and lower expectations from teachers, which in turn can lead to lower performance—a gap that only widens as girls get older.”

EAK’s competitors include Code Kingdoms, Swift Playgrounds and CodeCombat. But Saigal says these games tend to appeal far more to boys than to girls.

The new game (see below) will be sold to schools and parents, globally. EAK will also be carrying out a one-for-one scheme, where for every school account purchased, one will be donated to underserved schools via partnerships with tech companies, educational organizations, and NGOs.

Jonathan Seaton, Co-founder and CEO at Twinkl and Director of TwinklHive, said: “We’re really excited to partner with Erase All Kittens, as a digital company Twinkl recognizes the importance of preparing children to succeed in the digital age and we believe through this partnership we can really make a difference.”

“The team is particularly excited about helping further Erase All Kitten’s mission to empower girls and give them the same opportunities to learn to code and build their own digital creations. Ensuring that all children have equal access to opportunities to learn is at the heart of Twinkl’s vision and a key motivation in the development of this partnership for both organizations.”

Erase All Kittens

Erase All Kittens

Erase All Kittens says it is addressing the global skills gap, where the gender gap is increasingly widening. According to PWC, just 24% of the tech workforce is female and women make up just 12% of all engineers, while only 3% of female students in the UK list tech as their first career choice.

Research by Childwise found that 90% of girls give up on coding after first trying it, and if they lose interest in STEM subject by the age of 11, they never recover from that. This is a huge and growing problem for the tech industry and for investors.

Crusoe Energy is tackling energy use for cryptocurrencies and data centers and greenhouse gas emissions

By Jonathan Shieber

The two founders of Crusoe Energy think they may have a solution to two of the largest problems facing the planet today — the increasing energy footprint of the tech industry and the greenhouse gas emissions associated with the natural gas industry.

Crusoe, which uses excess natural gas from energy operations to power data centers and cryptocurrency mining operations, has just raised $128 million in new financing from some of the top names in the venture capital industry to build out its operations — and the timing couldn’t be better.

Methane emissions are emerging as a new area of focus for researchers and policymakers focused on reducing greenhouse gas emissions and keeping global warming within the 1.5 degree targets set under the Paris Agreement. And those emissions are just what Crusoe Energy is capturing to power its data centers and bitcoin mining operations.

The reason why addressing methane emissions is so critical in the short term is because these greenhouse gases trap more heat than their carbon dioxide counterparts and also dissipate more quickly. So dramatic reductions in methane emissions can do more in the short term to alleviate the global warming pressures that human industry is putting on the environment.

And the biggest source of methane emissions is the oil and gas industry. In the U.S. alone roughly 1.4 billion cubic feet of natural gas is flared daily, said Chase Lochmiller, a co-founder of Crusoe Energy. About two thirds of that is flared in Texas with another 500 million cubic feet flared in North Dakota, where Crusoe has focused its operations to date.

For Lochmiller, a former quant trader at some of the top American financial services institutions, and Cully Cavmess, a third generation oil and gas scion, the ability to capture natural gas and harness it for computing operations is a natural combination of the two men’s interests in financial engineering and environmental preservation.

NEW TOWN, ND – AUGUST 13: View of three oil wells and flaring of natural gas on The Fort Berthold Indian Reservation near New Town, ND on August 13, 2014. About 100 million dollars worth of natural gas burns off per month because a pipeline system isn’t in place yet to capture and safely transport it . The Three Affiliated Tribes on Fort Berthold represent Mandan, Hidatsa and Arikara Nations. It’s also at the epicenter of the fracking and oil boom that has brought oil royalties to a large number of native americans living there. (Photo by Linda Davidson / The Washington Post via Getty Images)

The two Denver natives met in prep-school and remained friends. When Lochmiller left for MIT and Cavness headed off to Middlebury they didn’t know that they’d eventually be launching a business together. But through Lochmiller’s exposure to large scale computing and the financial services industry, and Cavness assumption of the family business they came to the conclusion that there had to be a better way to address the massive waste associated with natural gas.

Conversation around Crusoe Energy began in 2018 when Lochmiller and Cavness went climbing in the Rockies to talk about Lochmiller’s trip to Mt. Everest.

When the two men started building their business, the initial focus was on finding an environmentally friendly way to deal with the energy footprint of bitcoin mining operations. It was this pitch that brought the company to the attention of investors at Polychain, the investment firm started by Olaf Carlson-Wee (and Lochmiller’s former employer), and investors like Bain Capital Ventures and new investor Valor Equity Partners.

(This was also the pitch that Lochmiller made to me to cover the company’s seed round. At the time I was skeptical of the company’s premise and was worried that the business would just be another way to prolong the use of hydrocarbons while propping up a cryptocurrency that had limited actual utility beyond a speculative hedge against governmental collapse. I was wrong on at least one of those assessments.)

“Regarding questions about sustainability, Crusoe has a clear standard of only pursuing projects that are net reducers of emissions. Generally the wells that Crusoe works with are already flaring and would continue to do so in the absence of Crusoe’s solution. The company has turned down numerous projects where they would be a buyer of low cost gas from a traditional pipeline because they explicitly do not want to be net adders of demand and emissions,” wrote a spokesman for Valor Equity in an email. “In addition, mining is increasingly moving to renewables and Crusoe’s approach to stranded energy can enable better economics for stranded or marginalized renewables, ultimately bringing more renewables into the mix. Mining can provide an interruptible base load demand that can be cut back when grid demand increases, so overall the effect to incentivize the addition of more renewable energy sources to the grid.”

Other investors have since piled on including: Lowercarbon Capital, DRW Ventures, Founders Fund, Coinbase Ventures, KCK Group, Upper90, Winklevoss Capital, Zigg Capital and Tesla co-founder JB Straubel.

The company now operate 40 modular data centers powered by otherwise wasted and flared natural gas throughout North Dakota, Montana, Wyoming and Colorado. Next year that number should expand to 100 units as Crusoe enters new markets such as Texas and New Mexico. Since launching in 2018, Crusoe has emerged as a scalable solution to reduce flaring through energy intensive computing such as bitcoin mining, graphical rendering, artificial intelligence model training and even protein folding simulations for COVID-19 therapeutic research.

Crusoe boasts 99.9% combustion efficiency for its methane, and is also bringing additional benefits in the form of new networking buildout at its data center and mining sites. Eventually, this networking capacity could lead to increased connectivity for rural communities surrounding the Crusoe sites.

Currently, 80% of the company’s operations are being used for bitcoin mining, but there’s increasing demand for use in data center operations and some universities, including Lochmiller’s alma mater of MIT are looking at the company’s offerings for their own computing needs.

“That’s very much in an incubated phase right now,” said Lochmiller. “A private alpha where we have a few test customers… we’ll make that available for public use later this year.”

Crusoe Energy Systems should have the lowest data center operating costs in the world, according to Lochmiller and while the company will spend money to support the infrastructure buildout necessary to get the data to customers, those costs are negligible when compared to energy consumption, Lochmiller said.

The same holds true for bitcoin mining, where the company can offer an alternative to coal powered mining operations in China and the construction of new renewable capacity that wouldn’t be used to service the grid. As cryptocurrencies look for a way to blunt criticism about the energy usage involved in their creation and distribution, Crusoe becomes an elegant solution.

Institutional and regulatory tailwinds are also propelling the company forward. Recently New Mexico passed new laws limiting flaring and venting to no more than 2 percent of an operator’s production by April of next year and North Dakota is pushing for incentives to support on-site flare capture systems while Wyoming signed a law creating incentives for flare gas reduction applied to bitcoin mining. The world’s largest financial services firms are also taking a stand against flare gas with BlackRock calling for an end to routine flaring by 2025.

“Where we view our power consumption, we draw a very clear line in our project evaluation stage where we’re reducing emissions for an oil and gas projects,” Lochmiller said. 

Longevity startup Longevica plans to launch supplements based on long-term research

By Mike Butcher

A biotech company, that has spent 11 years researching supplements to increase human longevity, plans to launch its supplements later this year. Longevica says it has attracted a total of $13 million from investors including, Alexander Chikunov, a longevity investor, who is also president of the company.

Longevica says it created a biotechnology platform for longevity after researching the life-span of laboratory mice. It now aims to produce medicines, dietary supplements, and food products.

The longevity space is a growing sector for tech startups. Google backed the launch of Calico in the space. Late last year Humanity Inc. raised $2.5 million in a round led by Boston fund One Way Ventures for its longevity company that will leverage AI to maximize people’s healthspan.

Longevica’s CEO Aynar Abdrakhmanov, backing up his company’s aim to tap the desire for people to live longer, said: “According to the WHO, by 2050, 2 billion people will be 60+ years old. By 2026, the sales of services and products for this audience will be around $27 trillion… By comparison, it was only $17 trillion in 2019.”

According to CB Insights, life-extension startups raised a record total of $800 million in 2018 alone. And there are some high-profile investors in the space.

PayPal co-founder Peter Thiel invested in Unity Biotechnology, which is developing drugs to treat diseases that accompany aging, has also raised significant funding.
 And Ethereum founder Vitalik Buterin invested $2.4 million worth of Ether into the nonprofit SENS Research foundation, where famed longevity research Aubrey de Grey is chief science officer, to develop rejuvenation biotechnologies.

Longevica is basing its platform on the work of scientist Alexey Ryazanov, who holds 10 US patents in the space, and a long-time researcher into the regulation of protein biosynthesis cells.

Chikunov said: “I gathered scientists known in this field to discuss their approaches to the problem. Then Alexey Ryazanov proposed the innovative idea of large-scale screening of all known pharmacological substances on long-lived mice in order to find those that prolong life.”

Under the leadership of Ryazanov, Longevica says it used 20,000 long-lived female mice and 1,033 drugs representing compounds from 62 pharmacological classes, to find five substances that statistically significantly increased longevity by 16-22%: Inulin, Pentetic Acid, Clofibrate, Proscillaridin A, D-Valine.

From this work, they formed a view about the elimination of certain heavy metals from the body and improve the body’s ability to remove toxins.

Score a free 30-day Extra Crunch membership when you buy a pass to TC Sessions: Mobility 2021

By Alexandra Ames

Does the science, technology — and yes, art — of creating new ways to transport people and parcels get your EV motor running? Then join us on June 9 at TC Sessions: Mobility 2021.

We’ll pack the day with interactive presentations and breakout sessions. Explore new tech, find emerging trends, discover what’s catching investor interest — and learn about evolving regulatory issues that affect the way mobility startups engage with cities and towns around the globe.

Buy your pass and take advantage of this extra perk — one free month of access to Extra Crunch, our members-only program featuring exclusive daily articles for founders and startup teams. Can you say value add? Yes, yes you can.

Pro Tip 1: Did you already buy a pass? No worries — we’ll email existing pass holders details on how they can claim their free Extra Crunch membership. All new ticket purchasers will receive information via email immediately after they complete their purchase.

Pro Tip 2: Do you already subscribe to Extra Crunch? Simply email extracrunch@techcrunch.com, tell us you’re an existing Extra Crunch member who bought a ticket to TC Sessions: Mobility 2021, and we’ll happily extend your membership.

TechCrunch always delivers the top experts in their field, and this event is no exception. You’ll connect and engage with the mobility movers, shakers, influencers and makers. It’s an opportunity to expand your network, find funding, forge new partnerships and yes, scope out your competition, too.

Here’s a peek at just some of the super speakers who will grace TC Mobility 2021’s virtual stage.

Can mobility be accessible, equitable and profitable? We tapped three heavy hitters to tackle this hot topic: Tamika L. Butler, a community organizer, transportation consultant and lawyer; Remix co-founder and CEO, Tiffany Chu; and Frank Reig, Revel co-founder and CEO.

Joby Aviation founder JoeBen Bevirt and Reid Hoffman, a LinkedIn co-founder and an investor who knows a thing or two about SPACs, will share their expertise on building a startup, keeping it secret while raising funds, the future of flight and, of course, SPACs.

What do people say about their Mobility experience? Rachael Wilcox, a creative producer at Volvo Cars — and a serial TC Sessions: Mobility attendee — told us why she makes it a point to attend every year.

“I go to TC Sessions: Mobility to find new and interesting companies, make new business connections and look for startups with investment potential. It’s an opportunity to expand my knowledge and inform my work.”

TC Sessions: Mobility 2021 takes place on June 9. Early-bird savings remain in effect until May 5, at 11:59 pm (PT). Buy your pass now, save money and enjoy one month of free access to Extra Crunch. Yay!

Is your company interested in sponsoring or exhibiting at TC Sessions: Mobility 2021? Contact our sponsorship sales team by filling out this form.

Brazil’s Loft adds $100M to its accounts, $700M to its valuation in a single month

By Mary Ann Azevedo

Nearly exactly one month ago, digital real estate platform Loft announced it had closed on $425 million in Series D funding led by New York-based D1 Capital Partners. The round included participation from a mix of new and existing investors such as DST, Tiger Global, Andreessen Horowitz, Fifth Wall and QED, among many others.

At the time, Loft was valued at $2.2 billion, a huge jump from its being just near unicorn territory in January 2020. The round marked one of the largest ever for a Brazilian startup.

Now, today, São Paulo-based Loft has announced an extension to that round with the closing of $100 million in additional funding that values the company at $2.9 billion. This means that the 3-year-old startup has increased its valuation by $700 million in a matter of weeks.

Baillie Gifford led the Series D-2 round, which also included participation from Tarsadia, Flight Deck, Caffeinated and others. Individuals also put money in the extension, including the founders of Better (Vishal Garg), GoPuff, Instacart, Kavak and Sweetgreen.

Loft has seen great success in its efforts to serve as a “one-stop shop” for Brazilians to help them manage the home buying and selling process. 

Image courtesy of Loft

In 2020, Loft saw the number of listings on its site increase “10 to 15 times,” according to co-founder and co-CEO Mate Pencz. Today, the company actively maintains more than 13,000 property listings in approximately 130 regions across São Paulo and Rio de Janeiro, partnering with more than 30,000 brokers. Not only are more people open to transacting digitally, more people are looking to buy versus rent in the country.

“We did more than 6x YoY growth with many thousands of transactions over the course of 2020,” Pencz told TechCrunch at the time of the company’s last raise. “We’re now growing into the many tens of thousands, and soon hundreds of thousands, of active listings.”

The decision to raise more capital so soon was due to a variety of factors. For one, Loft has received “overwhelming investor interest” even after “a very, very oversubscribed main round,” Pencz said.

“We have seen a continued acceleration in our market share growth, especially in São Paulo and Rio de Janeiro, the two markets we currently operate in,” he added. “We saw an opportunity to grow even faster with additional capital.”

Pencz also pointed out that Baillie Gifford has relatively large minimum check size requirements, which led to the extension being conducted at a higher price and increased the total round size “by quite a bit to be able to accommodate them.”

While the company was less forthcoming about its financials as of late, it told me last year that it had notched “over $150 million in annualized revenues in its first full year of operation” via more than 1,000 transactions.

The company’s revenues and GMV (gross merchandise value) “increased significantly” in 2020, according to Pencz, who declined to provide more specifics. He did say those figures are “multiples higher from where they were,” and that Loft has “a very clear horizon to profitability.”

Pencz and Florian Hagenbuch founded Loft in early 2018 and today serve as its co-CEOs. The aim of the platform, in the company’s words, is “bringing Latin American real estate into the e-commerce age by developing online alternatives to analogue legacy processes and leveraging data to create transparency in highly opaque markets.” The U.S. real estate tech company with the closest model to Loft’s is probably Zillow, according to Pencz.

In the United States, prospective buyers and sellers have the benefit of MLSs, which in the words of the National Association of Realtors, are private databases that are created, maintained and paid for by real estate professionals to help their clients buy and sell property. Loft itself spent years and many dollars in creating its own such databases for the Brazilian market. Besides helping people buy and sell homes, it offers services around insurance, renovations and rentals.

In 2020, Loft also entered the mortgage business by acquiring one of the largest mortgage brokerage businesses in Brazil. The startup now ranks among the top-three mortgage originators in the country, according to Pencz. When it comes to helping people apply for mortgages, he likened Loft to U.S.-based Better.com.

This latest financing brings Loft’s total funding raised to an impressive $800 million. Other backers include Brazil’s Canary and a group of high-profile angel investors such as Max Levchin of Affirm and PayPal, Palantir co-founder Joe Lonsdale, Instagram co-founder Mike Krieger and David Vélez, CEO and founder of Brazilian fintech Nubank. In addition, Loft has also raised more than $100 million in debt financing through a series of publicly listed real estate funds.

Loft plans to use its new capital in part to expand across Brazil and eventually in Latin America and beyond. The company is also planning to explore more M&A opportunities.

Window Snyder’s new startup Thistle Technologies raises $2.5M seed to secure IoT devices

By Zack Whittaker

The Internet of Things has a security problem. The past decade has seen wave after wave of new internet-connected devices, from sensors through to webcams and smart home tech, often manufactured in bulk but with little — if any — consideration to security. Worse, many device manufacturers make no effort to fix security flaws, while others simply leave out the software update mechanisms needed to deliver patches altogether.

That sets up an entire swath of insecure and unpatchable devices to fail, and destined to be thrown out when they break down or are invariably hacked.

Security veteran Window Snyder thinks there is a better way. Her new startup, Thistle Technologies, is backed with $2.5 million in seed funding from True Ventures with the goal of helping IoT manufacturers reliably and securely deliver software updates to their devices.

Snyder founded Thistle last year, and named it after the flowering plant with sharp prickles designed to deter animals from eating them. “It’s a defense mechanism,” Snyder told TechCrunch, a name that’s fitting for a defensive technology company. The startup aims to help device manufacturers without the personnel or resources to integrate update mechanisms into their device’s software in order to receive security updates and better defend against security threats.

“We’re building the means so that they don’t have to do it themselves. They want to spend the time building customer-facing features anyway,” said Snyder. Prior to founding Thistle, Snyder worked in senior cybersecurity positions at Apple, Intel, and Microsoft, and also served as chief security officer at Mozilla, Square, and Fastly.

Thistle lands on the security scene at a time when IoT needs it most. Botnet operators are known to scan the internet for devices with weak default passwords and hijack their internet connections to pummel victims with floods of internet traffic, knocking entire websites and networks offline. In 2016, a record-breaking distributed denial-of-service attack launched by the Mirai botnet on internet infrastructure giant Dyn knocked some of the biggest websites — Shopify, SoundCloud, Spotify, Twitter — offline for hours. Mirai had ensnared thousands of IoT devices into its network at the time of the attack.

Other malicious hackers target IoT devices as a way to get a foot into a victim’s network, allowing them to launch attacks or plant malware from the inside.

Since device manufacturers have done little to solve their security problems among themselves, lawmakers are looking at legislating to curb some of the more egregious security mistakes made by default manufacturers, like using default — and often unchangeable — passwords and selling devices with no way to deliver security updates.

California paved the way after passing an IoT security law in 2018, with the U.K. following shortly after in 2019. The U.S. has no federal law governing basic IoT security standards.

Snyder said the push to introduce IoT cybersecurity laws could be “an easy way for folks to get into compliance” without having to hire fleets of security engineers. Having an update mechanism in place also helps to keeps the IoT devices around for longer — potentially for years longer — simply by being able to push fixes and new features.

“To build the infrastructure that’s going to allow you to continue to make those devices resilient and deliver new functionality through software, that’s an incredible opportunity for these device manufacturers. And so I’m building a security infrastructure company to support that security needs,” she said.

With the seed round in the bank, Snyder said the company is focused on hiring device and back-end engineers, product managers, and building new partnerships with device manufacturers.

Phil Black, co-founder of True Ventures — Thistle’s seed round investor — described the company as “an astute and natural next step in security technologies.” He added: “Window has so many of the qualities we look for in founders. She has deep domain expertise, is highly respected within the security community, and she’s driven by a deep passion to evolve her industry.”

Hadrian is building the factories of the future for rocket ships and advanced manufacturing

By Jonathan Shieber

If the eight person team behind the new startup Hadrian has their way, they’ll have transformed the manufacturing industry within the next decade.

At least, that’s the goal for the new San Francisco-based startup, founded only last year, which has set its sights on building out a new model for advanced manufacturing to enable the satellite, space ship, and advanced energy technology companies to build the future they envision better and faster.

We view our job as to provide the world’s most efficient space and defense component factory,” said Hadrian founder, Chris Power.

Initially, the company is building factories to make the parts that go on rocket ships, according to Power, but the business has implications for any company that needs bespoke components to make their equipment.

“Let me tell you how bad it is at the moment and what’s going to happen over the next 20 years. Right now everyone in space and defense, [including] SpaceX and Lockheed Martin, outsources their parts and manufacturing to small factories across the country. They’re super expensive, they’re unreliable and they’re completely invisible to the customers,” said Power. “This causes big problems with space and defense manufacturers in the design phase, because the lead time is so long and the iteration time is super long. Imagine running software and being able to iterate on your product once every 20 days? If you can imagine a Gantt chart of how to build a rocket, about 60% of that is buffer time… A lot of the delays in launches and stuff like that happen because parts got delivered three months ago. It’d be like running a McDonalds and realizing that your fries and burger providers could not tell you when the food would arrive.”

It’s hard to overstate the strategic importance of the parts suppliers to the operations of aerospace, defense, and advanced machining companies. As no less an authority on manufacturing than Elon Musk noted in a tweet, “The factory is the product.” It’s also hard to overstate the geopolitical importance of re-establishing the U.S. as a center of manufacturing excellence, according to Hadrian’s investors Lux Capital, Founders Fund, and Construct Capital. Which is one reason why they’re investing $9.5 million into the very early stage business.

“America made massive strategic mistakes in the early 90s which have left our national manufacturing ecosystem completely dilapidated,” said Founders Fund principal Delian Asparouhov. “The only way to get out of this disaster is to re-invent the most basic input into our aerospace and defense supply chains, machining metal parts quickly and with high tolerance. Right now, America’s most innovative company, SpaceX, relies on a network of near-retired machinists to produce space-worthy metal parts, and no one in technology is. focused on solving this.”

 

The factory is the product

— Elon Musk (@elonmusk) January 11, 2021

Power got to understand the problem at his previous company, Ento, which sold workforce management software to blue collar customers. It was there he realized the issue of. the aging workforce and the need for manufacturers to upgrade almost every aspect of their own technology stack. “I realized that the right way to bring technology to the industrial space is not to sell software to these companies, it’s to build an industrial business from scratch with software.”

Initially, Hadrian is focusing all of its efforts on the space industry, where the component manufacturing problem is especially acute, but the manufacturing capabilities the company is building out have broad relevance across any industry that requires highly engineered components.

“The demand for manufacturing from both the large SpaceX and Blue Origin all the way to this growing long tail of companies from Anduril to Relativity to Varda,” said Lux Capital co-founder Josh Wolfe. “Most of these guys are using mom and pop machine shops… [and] those shops are horribly inefficient. They’re not consistent, and they’re not reliable. Between the software automation, the hardware, you can cut down on inefficiency every step of the process… I like to think of value creation as waste reduction… so mundane things like quoting, scheduling, bidding, and planning all the way to the programming of the manufacturing… every one of those things takes hours to tens of hours to days and weeks, so if you can do that in minutes, it’s just a no-brainer. [Hadrian] will be the cutting edge choice for all of the new and explicitly dedicated and focused aerospace and defense companies.”

Power envisions a network of manufacturing facilities that can initially cover roughly 65% of all space and defense components, and will eventually take that number up to 95% of components. Already several of the biggest launch vehicle and satellite manufacturers are in talks with the company to produce hundreds of units for them, Power said. Some of those companies just happen to be in the Construct, Lux, and Founders Fund portfolio.

And the company’s founder sees this as a new way to revitalize American manufacturing jobs as well. “Manufacturing jobs in space and defense can easily be as high paying as a software engineering job at Google,” he said. In an ideal world, Hadrian would like to offer an onramp to high paying manufacturing careers in the 21st century in the same way that automakers provided good union jobs in the twentieth.

“We haven’t built any of this. If you look at the sheer number of people that we need to train and hire on our new technology and new systems, that people problem and that training problem is part of growing our business.”

A render of Axiom’s future commercial space station design.

Sales scheduling platform Chili Piper raises $33M Series B funding led by Tiger Global

By Mike Butcher

Chili Piper, which has a sophisticated SaaS appointment scheduling platform for sales teams, has raised a $33 million B round led by Tiger Global. Existing investors Base10 Partners and Gradient Ventures (Google’s AI-focused VC) also participated. This brings the company’s total financing to $54 million. The company will use the capital raised to accelerate product development. The previous $18M A round was led by Base10 and Google’s Gradient Ventures 9 months ago.

It’s main competitor is Calendly, started 21/2 years previously, which recently achieved a $3Bn valuation.

Launched in 2016, Chili Piper’s software for B2B revenue teams is designed to convert leads into attended meetings. Sales teams can also use it to book demos, increase inbound conversion rates, eliminate manual lead routing, and streamline critical processes around meetings. It’s used by Intuit, Twilio, Forrester, Spotify, and Gong.

Chili Piper has a number of different tools for businesses to schedule and calendar accountments, but its key USP is in its use by ‘inbound SDR Sales Development Representatives (SDR)’, who are responsible for qualifying inbound sales leads. It’s particularly useful in scheduling calls when customers hit websites ask for a salesperson to call them back.

Nicolas Vandenberghe, CEO, and co-founder of Chili Piper said: “When we started we sold the house and decided to grow the company ourselves. So all the way until 2019 we bootstrapped. Tiger gave us a valuation that we expected to get at the end of this year, which will help us accelerate things much faster, so we couldn’t refuse it.”

Alina Vandenberghe, CPO, and Co-founder said: “We’re proud to have so many customers scheduling meetings and optimizing their calendars with Chili Piper’s Instant Booker.”

Since the pandemic hit, the husband-and-wife founded company has gone fully remote, with 93 employees in 81 cities and 21 countries.

John Curtius, Partner at Tiger Global said: “When we met Nicolas and Alina, we were fired up by their product vision and focus on customer happiness.”

TJ Nahigian, Managing Partner at Base10 Partners, added: “We originally invested in Chili Piper because we knew customers needed ways to add fire to how they connected with inbound leads. We’ve been absolutely blown away with the progress over the past year, 2020 has been a step-change for this company as business went remote.”

Persefoni’s carbon accounting platform raises $9.7 million

By Jonathan Shieber

The carbon accounting and management platform Persefoni now has $9.7 million more in funding to support its international expansion, product development, and recruitment efforts.

The round, led by Rice Investment Group with participation from NGP ETP, the electricity, renewable and sustainability-focused investment arm of the oil and gas and power focused investment fund NGP, comes only about six months after the startup’s initial launch in August.

Founded only last January, Persefoni touts its tools to assemble, calculate, manage, and report organizational carbon footprints.

The company’s software promises real time reports on scope 1 through 3 emissions (these are emissions generated by a company’s direct operations, its purchases of power and the emissions of its suppliers).

“On the back of a banner year of net-zero commitments from governments, asset managers, and organizations the world over, we saw the venture and software investor communities wake up to what is the formation of the largest regulatory compliance software market since the introduction of Sarbanes Oxley”, said Kentaro Kawamori, CEO and co-founder of Persefoni, in a statement. “We applaud the efforts of financial regulators around the world who are implementing carbon and climate disclosure requirements. Such regulation is one of the most impactful ways to get companies accounting for, and reducing, their carbon footprint.”

Private equity firms like TPG are signing on to Persefoni’s service and Greg Lyons, a principal at NGP will be taking a seat on the company’s board of directors.

Additional investors in the company include the Carnrite Group and Sallyport Investments.

“Sallyport looks to partner with high-growth companies with an aim of making a meaningful industry impact,” said Doug Foshee, founder and owner of Sallyport Investments, in a statement.

Boosting the company’s environmental, social, and corporate governance bona fides is the addition of Robert G. Eccles, the founding chairman of the Sustainability Accounting Standards Board, to Persefoni’s board of advisors.

ConsenSys raises $65M from JP Morgan, Mastercard, UBS to build infrastructure for DeFi

By Mike Butcher

ConsenSys, a key player in crypto and a major proponent of the Ethereum blockchain, has raised a $65 million funding round from J.P. Morgan, Mastercard, and UBS AG, as well as major blockchain companies Protocol Labs, the Maker Foundation, Fenbushi, The LAO and Alameda Research. Additional investors include CMT Digital and the Greater Bay Area Homeland Development Fund. As well as fiat, several funds invested with Ethereum-based stablecoins, DAI and USDC, as consideration.

Sources told TechCrunch that this is an unpriced round because of the valuation risk, and the funding instrument is “full”, so the round is being closed now.

The fundraise looks like a highly strategic one, based around the idea that traditional institutions will need visibility into the increasingly influential world of ‘decentralized finance’ (DeFi) and the Web3 applications being developed on the Ethereum blockchain.

In a statement on the fundraise, ConsenSys said it has been through a “period of strategic evolution and growth”, but most outside observers would agree that this is that’s something of an understatement.

After a period of quite a lot of ‘creative disruption’ to put it mildly (at one point a couple of years ago, ConsenSys seemed to have everything from a VC fund, to an accelerator, to multiple startups under its wing), the company has restructured to form two main arms: ConsenSys, the core software business; and ConsenSys Mesh, the investment arm, incubator, and portfolio. It also acquired the Quorum product from J.P. Morgan which has given it a deeper bench into the enterprise blockchain ecosystem. This means it now has a very key product suite for the Etherum platform, including products such as Codefi, Diligence, Infura, MetaMask, Truffle, and Quorum.

This suite allows it to serve both public and private permissioned blockchain networks. It can also support Layer 2 Ethereum networks, as well as facilitate access to adjacent protocols like IPFS, Filecoin, and others. ConsenSys is also a major contributor to the Ethereum 2.0 project, for obvious reasons.

Commenting on the fundraise, Joseph Lubin, founder of ConsenSys and co-founder, Ethreum said in a statement: “When we set out to raise a round, it was important to us to patiently construct a diverse cap table, consistent with our belief that similar to how the web developed, the whole economy would join the revolutionaries on a next-generation protocol. ConsenSys’ software stack represents access to a new automated objective trust foundation enabled by decentralized protocols like Ethereum. We are proud to partner with preeminent financial firms alongside leading crypto companies to further converge the centralized and decentralized financial domains at this particularly exciting time of growth for ConsenSys and the entire industry.”

With financial institutions able to see, ‘in public’ DeFi happening on Ethereuem, because of the public chain, they can see how much of the financial system is gradually starting to merge with the blockchain world. So it’s becoming clearer what attracts these major institutions.

Mike Dargan, Head of Group Technology at UBS said: “Our investment in ConsenSys adds proven expertise in distributed ledger technology to our UBS Next portfolio.”

For MasterCard this appears to be not just a pure investment – Consensys has been working with it on a private permissioned network.

Raj Dhamodharan, executive vice president of digital asset and blockchain products and partnerships at Mastercard said: “Enterprise Ethereum is a key infrastructure on which we and our partners are building payment and non-payment applications to power the future of commerce… Our investment and partnership with ConsenSys helps us bring secure and performant Enterprise Ethereum capabilities to our customers.”

Colleen Sullivan, Co-Founder and CEO of CMT Digital said: “ConsenSys is the pioneer in bridging the gaps across traditional finance, centralized crypto, and DeFi, and more broadly, between Web 2.0 and Web 3.0. We are proud to participate in this funding round as the ConsenSys team continues to pave the way for global users  — retail and institutional — to easily access the crypto ecosystem.”

TechCrunch understands that the fundraise was started around the time of the Quorum acquisition, last June. The $65 million round is in majority fiat currency as opposed to cryptocurrency and is an adjunct to the round done with JP Morgan last summer.

The presence of significant crypto players such as Maker Protocol Labs shows the significance of the fund-raise, beyond the simple transaction. The announcement also comes just ahead of the Coinbase IPO, which makes for interesting timing.

ConsenSys’ products have become highly significant in the world where developers, enterprises, and consumers meet blockchain and crypto. In its statement, the company claims MetaMask now has over three million monthly active users across mobile and desktop, a 3x increase in the last five or six months, it says. This is roughly the same amount of monthly active customers as Coinbase.

The ConsenSys announcement comes just ahead of the Coinbase IPO. While Coinbase is acting as an exchange to turn fiat into crypto and vice versa, it has also been getting into DeFi of late. Where there are also resemblances with ConsenSys, is that Coinbase, with 3 million users, is used as a wallet, and MetMask, which also has 3 million users, can also be used as a wallet. The comparison ends there, but it’s certainly interesting, given Coinbase’s $100 billion valuation.

As Jeremy Millar, Chief Development Officer, told me: “Coinbase has pioneered an exchange, in one of the world’s was regulated financial markets, the US. And it has helped drive significant interest in the space. We enjoy a very positive relationship with Coinbase, trying to further enable the ecosystem and adoption of the technology.”

The background to this raise is that a lot of early-stage blockchain and crypto companies have been raising a lot of money recently, but much of this has been through crypto investment firms. Only a handful of Silicon Valley VCs are backing blockchain, such as Andreessen Horowitz.

What’s interesting about this announcement is that these incumbent financial giants are not only taking an interest, but working alongside ConsenSys to both invest and build products on Ethereum.

It’s ConsenSys’ view that every payment service provider, banks will need this financial infrastructure in the future, especially for DeFI.

Given there is roughly $43 billion collateralized in DeFi, it’s increasingly the case that major investors are involved, and there are increasingly higher returns than traditional yield and bond or bond yields.

The moves by Central Banks into digital currencies is also forcing companies and governments to realize digital currency, and the ‘blockchain rails’ on which it runs, is here to stay. This is what is suggested by the Greater Bay Area Homeland Development Fund’s (a Shenzhen / Hong Kong joint partnership) decision to get involved.

Another aspect of this story is that ConsenSys is sitting on some extremely powerful products. Consensys has six products that serve three different types of people.

Service developers who are building on Ethereum are using Truffle to develop smart contracts. Users joining the NFT hype are using MetaMask underneath it all.

The MetaMask wallet allows users to swap one token for another. This has proved quite lucrative for ConsenSys, which says it has resulted in $1.8 billion in volume in decentralized exchange use. ConsenSys takes a 0.875 percent cut on every swap that it serves.

And institutions are using Consensys’ products. The company says more than 150,000 developers use Infura’s APIs, and 4.5 million developers create and deploy smart contracts using Truffle, while its Protocols group — developer of Hyperledger Besu and ConsenSys Quorum — are building Central Bank Digital Currencies (CBDCs) for six central banks, says Consensys.

Consensys is also making hay with the NFT boom. Developers are using Consensys products for the nodes and infrastructure on Ethereum which stores the NFT files.

Consensys is also riding two waves. One is the developer eave and the other is the financial system wave.

As a spokesperson said: “Where the interest in money and invention started happening was on public networks like Ethereum. So we really believe that these are converging and they will continue to, and every one of our products offers public main net compatibility because we think this is the future.”

Millar added: “If we want to help the world adopt the technology we need to meet it at its adoption point, which for many large enterprises means inside the firewall first. But similarly, we think, just like the public Internet, the real value – the disruptive value – changes the ability to do this on a broader permissionless basis, especially when you have sufficient privacy and authentication available.”

How one founder identified a huge healthcare gap and acquired the skills necessary to address it

By Darrell Etherington

Our new podcast Found is now available, and the first episode features guest Iman Abuzeid, co-founder and CEO of Incredible Health. Abuzeid’s story of founding and building Incredible Health, a career platform for healthcare professionals focusing specifically on nurses, is all about a focused entrepreneur building a unique skill set, and acquiring the experience necessary to create a world-leading solution.

Abuzeid went to medical school and acquired her MD, but decided before residency to instead go get an MBA from Wharton, in order to pursue her dream of entrepreneurship, inspired by two generations of entrepreneurs in the family that preceded her. After eventually making her way to Silicon Valley and working in a couple of other startups in the healthcare space, Abuzeid took important lessons away from those experiences about what not to do when running your own company, and embarked on building her own with co-founder Rome Portlock, now the company’s CTO.

Incredible Health is tackling a huge challenge — the shortfall of availability of skilled nurses, and the lack of mature, sophisticated career resources to help those nurses in their professional life. COVID-19 threw those issues into stark relief, and Incredible Health adjusted its game plan to adapt to its users’ needs. Abuzeid tells us all about how she made those calls, and also how she convinced venture investors to come along for the ride.

We hope you enjoy this episode, and don’t forget to subscribe in Apple Podcasts, Spotify, or your podcast app of choice. We’d love to hear your feed back, too — either on Twitter or via email, and tune in weekly for more episodes.

Found is hosted by Darrell Etherington and Jordan Crook, and is produced, mixed and edited by Yashad Kulkarni. TechCrunch’s audio products are managed by Henry Pickavet, and Bryce Durbin created the show’s artwork. Found published weekly on Friday afternoons, and you can find past episodes on TechCrunch here.

As working out goes virtual, Moxie raises $6.3M Seed+ round led by Resolute Ventures

By Mike Butcher

With the pandemic sending the planet indoors to workout, the at-home fitness market has boomed. It was only in October last year that three-year-old Future closed $24 million in Series B and Playbook (streaming for personal trainers) raised $9.3 million in a Series A. Into this market launched Moxie, a platform that allowed fitness instructors to broadcast live and recorded classes, access licensed music playlists and deploy a CRM and payment tools. Classes range from $5-$25 and various subscriptions and packages are offered.

Moxie has now raised a $6.3M ‘Seed+’ funding round led by Resolute Ventures with participation from Bessemer Ventures, Greycroft Ventures, Gokul Rajaram, and additional investors. With the $2.1M Seed round from last October, that means Moxie has now raised a total of $8.4M.

With the funding, Moxie now plans to better optimize the user experience with a curated selection of top Moxie classes; new tools that help connect users to instructors; and the ability to preview classes before attending.

The company claims to have experienced “exponential growth” because of its convenience in the pandemic era, with 8,000 classes and 1 million class-minutes completed in March. Moxie’s independent instructors set their own schedules and prices, and get to keep 85% of what they earn on the platform.

The company will also now launch ‘Moxie Benefits’ in partnership with Stride Health, provide instructors with access to health insurance, dental and vision plans, life insurance, and other benefits.

Also planned is ‘Moxie Teams’, enabling groups of instructors to join together to form small businesses on the platform, not unlike the way some Uber drivers form teams.

Jason Goldberg, CEO and founder said in a statement: “Moxie was born during the pandemic alongside thousands of independent fitness instructors who were forced out of gyms and studios and suddenly had to become entrepreneurs and navigate the new frontier of virtual fitness. Now we are seeing widespread adoption of online fitness into people’s lives, and Moxie’s growth proves that these shifts in consumer behavior have staying power. We know that 89% of Moxie users plan to continue virtual workouts post COVID — they love the convenience.”

Resolute Ventures Partner & Co-Founder Raanan Bar-Cohen said: “Our investment theory has always been to identify entrepreneurial founders solving for today’s problems. With Moxie, we saw an experienced operator in Jason, with a product that solved for the issues that instructors and consumers had experienced in the shift to online fitness, as well as a clear roadmap for continued success.”

So why has Moxie managed to cleave to the new virtual workout culture? Goldburg tells me it’s down to a range of factors.

For starters, it’s a two-sided fitness marketplace that has live interactive group fitness classes, unlike VOD apps, and, crucially, unlike Peloton. Additionally, any instructor can teach on Moxie, rather than wait to be picked as a ‘star’ by Peloton. Since 90% of classes are live group fitness classes, they are effectively replacing yoga studios and HIIT classes, rather than personal training. He says many top instructors are now earning $6-figures on the platform.

Certainly, Moxie has managed to capitalize on the fact that while gyms are closed, it’s easy to do virtual classes. Will they still stick around when the pandemic is over? Presumably many will find it more convenient than schlepping to the gym and less intimidating than joining classes in person. Additionally, users can switch classes as easily as switching TV channels.

As Goldberg told me via email: “Covid forced everyone to try virtual fitness for the first time. Guess what? People found it more convenient and more connected than going to offline gyms. And guess what? Peloton is not for everyone.”

Manticore Games raises $100 million to build a ‘creator multiverse’

By Lucas Matney

The gaming sector has never been hotter or had higher expectations from investors who are dumping billions into upstarts that can adjust to shifting tides faster that the existing giants will.

Bay Area-based Manticore Games is one of the second-layer gaming platforms looking to build on the market’s momentum. The startup tells TechCrunch they’ve closed a $100 million Series C funding round, bringing their total funding to $160 million. The round was led by XN, with participation from Softbank and LVP alongside existing investors Benchmark, Bitkraft, Correlation Ventures and Epic Games.

When Manticore closed its Series B back in September 2019, VCs were starting to take Roblox and the gaming sector more seriously, but it took the pandemic hitting to really expand their expectations for the market. “Gaming is now a bonafide super category,” CEO Frederic Descamps tells TechCrunch.

Manticore’s Core gaming platform is quite similar to Roblox conceptually, the big difference is that the gaming company is aiming to quickly scale up a games and creator platform geared towards the 13+ crowd that may have already left Roblox behind. The challenge will be coaxing that demographic faster than Roblox can expand its own ambitions, and doing so while other venture-backed gaming startups like Rec Room, which recently raised at a $1.2 billion valuation, race for the same prize.

Like other players, Manticore is attempting to build a game discovery platform directly into a game engine. They haven’t built the engine tech from scratch, they’ve been working closely with Epic Games which makes the Unreal Engine and made a $15 million investment in the company last year.

A big focus of the Core platform is giving creators a true drag-and-drop platform for game creation with a specific focus on “remixing” allowing users to pick pre-made environments, drop pre-rendered 3D assets into them, choose a game mode and publish it to the web. For creators looking to inject new mechanics or assets into a title, there will be some technical know-how necessary but Manticore’s team hopes that making the barriers of entry low for new creators means that they can grow alongside the platform. Manticore’s big bet is on the flexibility of their engine, hoping that creators will come on board for the chance to engineer their own mechanics or create their own path towards monetization, something established app store wouldn’t allow them to.

“Creators can implement their own styles of [in-app purchases] and what we’re really hoping for here is that maybe the next battle pass equivalent innovation will come out of this,” co-founder Jordan Maynard tells us.

This all comes at an added cost, developers earn 50% of revenues from their games, leaving more potential revenue locked up in fees routed to the platforms that Manticore depends on than if they built for the App Store directly, but this revenue split is still much friendlier to creators that what they can earn on platforms like Roblox.

Building cross-platform secondary gaming platforms is host to plenty of its own challenges. The platforms involved not only have to deal with stacking revenue share fees on non-PC platforms, but some hardware platforms that are reticent to allow them all, an area where Sony has been a particular stickler with PlayStation. The long-term success of these platforms may ultimately rely on greater independence, something that seems hard to imagine happening on consoles and mobile ecosystems.

Apple invests $50M into music distributor UnitedMasters alongside A16z and Alphabet

By Matthew Panzarino

Independent music distribution platform and tool factory UnitedMasters has raised a $50M series B round led by Apple. A16z and Alphabet are participating again in this raise. United Masters is also entering a strategic partnership with Apple alongside this investment. 

If you’re unfamiliar with UnitedMasters, it’s a distribution company launched in 2017 by Steve Stoute, a former Interscope and Sony Music executive. The focus of UnitedMasters is to provide artists with a direct pipeline to data around the way that fans are interacting with their content and community, allowing them to connect more directly to offer tickets, merchandise and other commercial efforts. UnitedMasters also generally allows artists to retain control of their own masters.

Neither of these conditions are at all typical in the music industry. In a typical artist deal, recording companies retain all audience and targeting data as well as masters. This limits an artist’s ability to be agile, taking advantage of new technologies to foster a community. 

While Apple does invest in various companies, it typically does so out of its Advanced Manufacturing Fund to promote US manufacturing or strategically in partners that make critical components of its hardware like silicon foundries or glass manufacturing. Apple does a lot more purchasing than investing, typically, buying a company every few weeks or so to supplement one product effort or another. UnitedMasters, then, would be a relatively unique partnership, especially in the music space. 

I spoke to UnitedMasters CEO Steve Stoute about the deal and what it means for the businesses 1M current artists and new ones. Stoute credits Apple executive Eddy Cue having a philosophy aligned with the UnitedMasters vision with getting this deal done. 

“We want all artists to have the same opportunity,” says Stoute. “Currently, independent artists have less opportunity for success and we’re trying to remove that stigma.”

This infusion, Stoute says, will be used to hire talent that are mission oriented to take UnitedMasters global. They’re seeking local technical talent and artists talent to build out the platform worldwide. 

“Every artist needs access to a CTO,” Stoute says. “Some of the value of what a manager is today for an artist needs to be transferred to that role.”

UnitedMasters wants to provide that technical edge at scale, allowing artists to build out their fanbase at a community level.

Currently, UnitedMasters has deals with the NBA, ESPN, TikTok, Twitch and others that allow artists to tap big brand deals that would normally be brokered by a label and manager. It also has a direct distribution app that allows publishing to all of the major streaming services. Most importantly, they can check stream, fan and earnings data at a glance. 

“Steve Stoute and UnitedMasters provide creators with more opportunities to advance their careers and bring their music to the world,” said Apple’s Eddy Cue in a release statement. “The contributions of independent artists play a significant role in driving the continued growth and success of the music industry, and UnitedMasters, like Apple, is committed to empowering creators.”

“UnitedMasters has completely transformed the way artists create, retain ownership in their work, and connect with their fans,” said Ben Horowitz, Co-Founder and General Partner of Andreessen Horowitz in a release. “We are excited to work with Steve and team to build a better, bigger, and far more profitable world for musical artists.” 

We are currently at an inflection point in the way that artists and fans connect with one another. Though there have been seemingly endless ways for artists to get their messages out or speak to fans using social media and other platforms, the actual business of distributing work to a community and making money from that work has been out of their hands completely since the beginning of the recording industry. Recent developments like NFTs, DAOs and social tokens, as well as an explosion of DTC frameworks have begun to re-write that deal. But the major players have yet to make the truly aggressive strides they need to in order to embrace this ‘artist centric’ new world. 

The mechanics of distribution have been based on a framework defined by DRM and the DMCA for decades. This framework was always marketed as a way to protect value for the artist but was in fact architected to protect value for the distributor. We need a rethinking of the entire distribution layer.

As I mentioned when reporting the UnitedMasters + TikTok deal, it’s going to be instrumental in a more equitable future for artists:

It’s beyond time for the creators of The Culture to benefit from that culture. That’s why I find this UnitedMasters deal so interesting. Offering a direct pipeline to audiences without the attendant vulture-ism of the recording industry apparatus is really well-aligned with a platform like TikTok, which encourages and enables “viral sounds” with collaborative performances. Traditional deal structures are not well-suited to capturing viral hype, which can rise and fall within weeks without additional fuel.

In music, Apple is at the center of this maelstrom along with a few other major players like Spotify. One of the big misses in recent years for Apple Music, in my opinion, was Apple’s failure to turn Apple Music Connect into an industry-standard portal that allowed artists to connect broadly with fans, distribute directly, sell tickets and merchandise but — most importantly — to foster and own their community. 

A UnitedMasters tie up isn’t a straight line to that goal, but it’s definitely got the ingredients. I’m looking forward to seeing what this produces. 

Image Credits: Steve Stoute

NBA Top Shot maker Dapper Labs is now worth $2.6 billion thanks to half of Hollywood, the NBA, and Michael Jordan

By Jonathan Shieber

From the early success of Crypto Kitties to the explosive growth of NBA Top Shot, Dapper Labs has been at the forefront of the cryptocurrency collectible craze known as NFTs.

Now the company is reaping the benefits of its trailblazing status with a new $305 million financing led by some of the biggest names in Hollywood, sports, and investing.

The new round values the company at a whopping $2.6 billion, according to multiple media reports, and comes at a time when NFTs have captured the popular imagination.

Leading the company’s financing was Coatue, the financial services firm that’s behind many of the biggest later stage tech deals. But heavy hitters from the entertainment world also took their cut — these are folks like NBA legend Michael Jordan as well as current players and funds including Kevin Durant, Andre Iguodala, Kyle Lowry, Spencer Dinwiddie, Andre Drummond, Alex Caruso, Michael Carter-Williams, Josh Hart, Udonis Haslem, JaVale McGee, Khris Middleton, Domantas Sabonis, Klay Thompson, Nikola Vucevic, Thad Young, and Richard Seymour’s 93 Ventures.

Entertainment and music heavyweights including Ashton Kutcher and Guy Oseary’s Sound Ventures, Will Smith and Keisuke Honda’s Dreamers VC, Shawn Mendes and Andrew Gertler’s AG Ventures, Shay Mitchell, and 2 Chainz also bought in on the action.

And from the venture world comes other strategic investors like Andreessen Horowitz, The Chernin Group, USV, Version One, and Venrock.

The company said it would use the funds to continue building out NBA Top Shot and expanding the updated digital trading card platform to other sports and a broader creator community.

Top Shot has already notched over $500 million in sales for its animated trading cards featuring things like LeBron James dunking and the sky (at least for now) is seemingly the limit for the collectible applications of blockchain.

It’s like the one thing that cryptocurrency can do really well and it’s been embraced far beyond the world of sports collectibles. The recent $69 million sale of a digital piece of art at Christies also marks a watershed moment for art world.

“NBA Top Shot is successful because it taps into basketball fandom – it’s a new and more exciting way for people to connect with their favorite teams and players,” said Roham Gharegozlou, CEO of Dapper Labs. “We want to bring the same magic to other sports leagues as well as help other entertainment studios and independent creators find their own approaches in exploring open platforms. NFTs unlock a new model for monetization that benefits the fans much more than advertising or sponsorships.”

Powering the Top Shot system and Dapper Labs’ other offerings is a new blockchain protocol called Flow, which purports to handle mainstream consumer applications at scale, and can support mass adoption.

Flow also allows for transactions using fiat currency and credit cards in addition to provide a much needed ease of cryptocurrency, and can keep customers safe from the fraud or theft common in cryptocurrency systems, according to a statement from Dapper Labs.

Flow enables NFT marketplaces and other decentralized applications that need to scale to handle mainstream demand without extremely high transaction costs (“gas fees”) or environmental concerns, the company said.

“NBA Top Shot is one of the best demonstrations we’ve seen of how quickly new technology can change the landscape for media and sports fans,” said Kevin Durant, Co-Founder of Thirty Five Ventures. “We’re excited to follow the progress with everything happening on Flow blockchain and use our platform with the Boardroom to connect with fans in a new way.”

Already companies like Warner Music Group, Ubisoft, Warner Media, and the UFC, as well as thousands of third party developers, artists, and other creators are using the Flow mainnet to sell collectible cards, and develop custodial wallets.

Additional investors in the round include: MLB players like Tim Beckham and Nolan Arenado; NFL players: Ken Crawley, Thomas Davis, Stefon Diggs, Dee Ford, Malcom Jenkins, Rodney McLeod, Jordan Matthew, Devin McCourty, Jason McCourty, DK Metcalf, Tyrod Taylor, and Trent Williams; team ownership including Vivek Ranadive (Kings), and notable sports investors Bolt Ventures.

Atlanta’s early stage investment renaissance continues with Overline’s $27 million fund close

By Jonathan Shieber

Michael Cohn became a celebrity in the Atlanta startup ecosystem when the company he co-founded was sold to Accenture in a deal valued somewhere between $350 million and $400 million nearly six years ago.

That same year, Sean O’Brien also made waves in the community when he helped shepherd the sale of the  collaboration software vendor, PGi, to a private equity firm for $1.5 billion.

The two men are now looking to become fixtures in the city’s burgeoning new tech community with the close of their seed-stage venture capital firm’s first fund, a $27.4 million investment vehicle.

Overline’s first fund has already made commitments to companies that are expanding the parameters of what’s investible in the Southeast broadly and Atlanta’s startup scene locally.

These are companies like Grubbly Farms, which sells insect-based chicken feed for backyard farmers, or Kayhan Space, which is aiming to be the air traffic control service for the space industry. Others, like Padsplit, an Atlanta-based flexible housing marketplace, are tackling America’s low income housing crisis. 

“Our business model is very different from that of a traditional software startup, and the Overline team’s unique strengths and operator mindset have been invaluable in helping us grow the company,” said Sean Warner, CEO and co-founder of Grubbly Farms. 

That’s on top of investments into companies building on Atlanta’s natural strengths as a financial services, payments and business software powerhouse.

For all of the activity in Atlanta these days, the city and the broader southeastern region is still massively underfunded, according to O’brien and Cohn. The region only received less than 10 percent of all the institutional venture investments that were committed in 2020. Indeed, only seven percent of Atlanta founders raise money locally when they’re first starting out, an Overline survey suggested.

“The data reflects what we have seen throughout our careers building, growing, and investing in startups. There is no shortage of phenomenal founders and businesses coming out of Atlanta and the Southeast, but they often struggle to find institutional capital at their earliest stages,” said O’Brien, in a statement. “Overline will lead as the first institutional check for these companies and be a true partner to the Founders throughout their lifecycle—supporting them on the strategic and operational business initiatives and decisions that are critical to a company’s success.” 

The limited partners in Overline’s first fund also reflects the firm’s emphasis on regional roots. The privately held email marketing behemoth Mailchimp anchored the fund, which also included partners like Cox Enterprises, Social Leverage,

Overline is supported by a bench of impressive partners that reflects the firm’s roots in the Southeast. Anchored by marketing platform, Mailchimp, additional partners include Cox Enterprises, Scottsdale, Ariz.-based Social Leverage, Wilmington, Del.-based Hallett Capital, and Atlanta Tech Village founder David Cummings, along with Techstars co-founder David Cohen. 

“At Mailchimp, we love our hometown of Atlanta, and are proud of the robust startup ecosystem that’s growing in our city. The Overline founding team’s vision of deploying smart, local capital into startups in Atlanta and the Southeast aligns with our goals of promoting and advancing local innovation,” said Rick Lynch, CFO, Mailchimp, in a statement.

The firm expects to make investments of between $250,000 to $1.5 million into seed stage companies and has already backed 11 companies including, Relay Payments, a logistics fintech company that has raised over $40 million from top-tier investors. 

“When we set out to build Atlanta Tech Village almost a decade ago, one of our primary goals was to help Atlanta develop into a top 10 startup city, where all entrepreneurs would thrive. We’re making tremendous strides as a community, as evidenced by the number of newly minted unicorns,” said serial entrepreneur and Atlanta Tech Village founder David Cummings. “I believe in Overline’s thesis that value-add institutional early-stage capital is critical to the ecosystem’s continued development. Since the early days, Michael and Sean have been an active presence in our community in a way that goes far beyond being a source of capital—as mentors, advisors, and champions of Atlanta founders. I am proud to be one of their first investors.”

Bluu Biosciences raises cash to become Europe’s first purveyor of lab-grown salmon, trout and carp

By Jonathan Shieber

A startup from Europe is joining the race to become the first big provider of lab grown fish.

Bluu Biosciences has raised €7 million in a round of financing from investors including Manta Ray Ventures, Norrsken VC, Be8, CPT Capital and Lever VC to compete with a host of startups like BluNalu, Wild Type, and Shiok Meats in a bid to market with a lab-grown fish replacement.

The market for sustainable fish is huge and growing. Already, concerns over the effects of overfishing and industrial fish farming are mounting as demand for fish increases. It’s the same problem that other animal-based sources of protein face. The amount of demand for high quality sources of protein from the Earth’s several billion people cannot sustainably keep up with the available supply.

That’s why a number of cellular meat companies are focusing on fish instead of other meats like beef, pork, or chicken.

There is a lot of talent in Europe and very little companies built in this space. If you compare it t0 the mammalian space there are a lot fewer companies,” said Simon Fabich, co-founder and managing director of Bluu.  

At Berlin-based Bluu, the focus is on salmon, trout, and carp (the most popular fish in China). Other companies are tackling tuna, salmon, and shrimp, but Bluu sees carp as an especially attractive target, given its popularity in one of the world’s most populous companies.

One advantage for Bluu, its founders argue, is the deep experience that co-founder Sebastian Rakers has in the wild world of cultivated fish cells.

A marine and cell biologist who was working for several years at the Munich-based Fraunhofer Institute, one of Europe’s most celebrated research institutes, Rakers led a task force that looked at potential commercial viability of cell-based meat, after conducting research on the viability of using fish cells as a component for viral production for the pharmaceutical industry.

Bluu Biotechnologies co-founder Sebastian Rakers. Image Credit: Bluu Biosciences

During his research Rakers cultivated 80 different cell cultures for more than 20 different species of fish. What’s more, he was able to make these cell lines immortal.

Before envisioning an endless, ever-producing mass of fish cells that could overwhelm the world, it might be worth explaining what immortal cell lines mean… Actually… the endless, ever-producing mass of self-reproducing fish cells comes pretty close.

Most cell lines tend to die off after reprodcuing a certain number of times, which means that to manufacture meat at scale can require several biopsies of the same animal to cultivate multiple cell lines at a time. Rakers said that Bluu could avoid that step, thanks to the work that had already been done to develop these “immortal” salmon, trout, and carp cell cultivars.

“It’s such a strong competitive advantage,” said Fabich. “If you have normal cells that are not immortalized you can only proliferate 20 to 25 times and then you need to start again from another biopsy. With immortalized cells you can grow up to 100,000 times and we can double it every day.” 

With this technology in hand, Rakers said he was thinking about what could come next in his own career and met up with Gary Lin, an impact investor and the founder of Purple Orange Ventures.

Lin connected Rakers with Fabich and the two men set off to commercialize Rakers’ research as Bluu. And even though there are several companies that have a head start in the market (and in funding), Rakers said that there are certain advantages to coming in late.

Five years ago there was hardly any company looking into media development, hardly any companies focused on bioreactor technologies at a very large scale and there was no company looking for scaffolding alternatives for cell-based meat,” he said. Now there are. 

The company is picking up speed quickly thanks to those other technology providers that are coming to market and will look to have a prototype product out by the end of 2022.

The company is also pushing for regulation, which both Fabich and Rakers said were one of the last remaining obstacles to commercialization. Ultimately, the company has its eye firmly on the Asian market. “That’s the one that moves the needle,” in terms of sustainability, Fabich said. “We can have the biggest impact if we change production behavior there.”

Bluu Biosciences co-founders Sebastian Rakers and Simon Fabich. Image Credit: Bluu Biosciences

 

Closing on $103M, MaC VC is changing the face of venture capital

By Jonathan Shieber

The partners at MaC Venture Capital, the Los Angeles-based investment firm that has just closed on $103 million for its inaugural fund, have spent the bulk of their careers breaking barriers.

Formed when M Ventures (a firm founded by former Washington DC mayor Adrian Fenty); the first Black talent agency partner in the history of Hollywood, Charles D. King; and longtime operating executive (and former agent) Michael Palank joined forces with Marlon Nichols, a co-founder of the LA-based investment firm Cross Culture Capital, MaC Venture Capital wanted to be a different kind of fund.

The firm combines the focus on investing in software that Fenty had honed from his years spent as a special advisor to Andreessen Horowitz, where he spent five years before setting out to launch M Ventures; and Nichols’ thesis-driven approach to focusing on particular sectors that are being transformed by global cultural shifts wrought by changing consumer behavior and demographics.

“There’s a long history and a lot of relationships here,” said King, one of Hollywood’s premier power players and the founder of the global media company, Macro. “Adrian and I go back to 93 [when] we were in law school. We went on to conquer the world, where he went out to Washington DC and I became a senior partner at WME.”

Palank was connected to the team through King as well, since the two men worked together at William Morris before running business development for Will Smith and others.

“There was this idea of having connectivity between tech and innovation… that’s when we formed M Ventures [but] that understanding of media and culture… that focus… was complimentary with what Marlon was doing at Cross Culture,” King said.

Few firms could merge the cultural revolutions wrought by DJ Herc spinning records in the rec room of a Bronx apartment building and Sir Tim Berners Lee’s invention of the internet, but that’s exactly what MaC VC aims to do.

And while the firm’s founding partnership would prefer to focus on the financial achievements of their respective firms and the investments that now comprise the new portfolio of their combined efforts — it includes StokeGoodfairFinessePureStream, and Sote — it’s hard to overstate the significance that a general partnership that includes three Black men have raised $103 million in an industry that’s been repeatedly called out for problems with diversity and inclusion.

MaC Venture Capital co-founders Marlon Nichols, Michael Palank, Charles King, and Adrian Fenty. Image Credit: MaC Venture Capital

“Our LPs invested in us… for lots of different reasons but at the top of the list was that we are a diverse team in so many ways. We’re going to show them a set of companies that they would not have seen from any [other] VC fund,” said Fenty. “We also, in turn, have the same investing thesis when we look at companies. We want to have women founders, African American founders, Latino founders… In our fund now we have some companies that are all women, all African American or all Latino.”

The diversity of the firm’s ethos is also reflected in the broad group of limited partners that have come on to bankroll its operations: it includes Goldman Sachs, the University of Michigan, Howard University, Mitch and Freada Kapor, Foot Locker, and Greenspring Associates.

“We are thrilled to join MaC Venture Capital in this key milestone toward building a new kind of venture capital firm that is anchored around a cultural investment thesis and supports transformative companies and dynamic founders,” said Daniel Feder, Managing Director with the University of Michigan Investment Office, in a statement. “Their unified understanding of technology, media, entertainment, and government, along with a successful track record of investing, give them deep insights into burgeoning shifts in culture and behavior.”

And it extends to the firm’s portfolio, a clutch of startup companies headquartered around the globe — from Seattle to Houston and Los Angeles to Nairobi.

“We look at all verticals. We’re very happy to be generalists,” said Fenty.

A laser focus on software-enabled businesses is complemented by the thesis-driven approach laid out in position papers staking out predictions for how the ubiquity of gaming; conscious consumerism; new parenting paradigms; and cultural and demographic shifts will transform the global economy.

Increasingly, that thesis also means moving into areas of frontier technologies that include the space industry, mixed reality and everything at the intersection of computing and the transformation of the physical world — drawn in part by the firm’s close connection to the diverse tech ecosystem that’s emerging in Los Angeles. “We’re seeing these SpaceX and Tesla mafias spin out, entrepreneurs who have had best-in-class training at an Elon Musk company,” said Palank. “It’s a great talent pool, and LA has more computer science students graduating every year than Northern California.”

With its current portfolio, though early, the venture firm is operating in the top 5% of funds — at least on paper — and its early investments are up 3 times what the firm invested, Nichols said. 

“The way to think about it is MaC is essentially an extension of what we were building before,” the Cross Culture Ventures co-founder said. “We’re sticking with the concept that talent is ubiquitous but access to capital and opportunity is not. We want to be the source and access to capital for those founders.”

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