TechCrunch has found itself writing about layoffs at a few notable tech companies this week — and not just Softbank-backed ones. The focus is very much profits, as Alex Wilhelm summed up on Thursday, especially after the failed WeWork IPO and subsequent valuation and headcount decimation. We’ll be digging into the topic more soon but there does seem to be a certain consumery thread here. And perhaps some fears of negative macro trends bubbling up?
23andMe cut 16% or 100 people, citing slowing sales for DNA tests. Quora reduced an undisclosed number to focus on revenue.
Plenty of tech investors have criticized Softbank’s approach to writing large check for large valuations, but they can’t avoid the same fears these days. So does Mozilla, which had to cut 70 people this month after struggling to build revenue products.
It still all seems sort of normal given the very high valuations and recent reconsiderations, at least so far. Layoffs may very well continue this year in a way that is necessary and even healthy in the long run.
More on TechCrunch, from Alex:
23andMe and Mozilla are not alone, however. Playful Studios cut staff just this week, 2019 itself saw more than 300% more tech layoffs than in the preceding year and TechCrunch has covered a litany of layoffs at Vision Fund-backed companies over the past few months, including:
- Staff cuts at Zume, the startup famous for considering making mobile pizza robots
- Personnel reductions at Rappi, an e-commerce company
- Cuts at Getaround, a car rental service
- Layoffs at Oyo, a budget hotel unicorn
Scooter unicorns Lime and Bird have also reduced staff this year. The for-profit drive is firing on all cylinders in the wake of the failed WeWork IPO attempt. WeWork was an outlier in terms of how bad its financial results were, but the fear it introduced to the market appears pretty damn mainstream by this point. (Forsake hope, alle ye whoe require a Series H.)
Image: Bryce Durbin/TechCrunch
Fresh data sets are in on last year from Crunchbase, as well as PitchBook and the NVCA. Alex identified a few key takeaways: slightly lower early-stage fundings, a big global year overall, and some of the above WeWork-attributed drops already surfacing in the Q4 data over on TechCrunch.
I have to wonder what we really know right now, though. These are the best publicly-accessible funding databases out there, but many companies have stopped filing Form Ds with the U.S. Securities and Exchange Commission in recent years, as Danny Crichton has been covering in this ongoing series. That was a main data source, especially about early-stage stealth companies.
The Crunchbase report goes over the global trend for the year, and that’s another confounding factor, actually — how trackable are startup funding dollars across borders these days? And how do you account for remote teams in that mix? And how do you account for crypto…?
If you are building a company now at any stage, the financial signs out now are not in my humble opinion ones to have any fear over. Especially relative to the other problems that are almost certainly in front of you.
There is a lot of money in VC now regardless of anything else, as the Pitchbook-NVCA report notes, and there will be for a long time.
As if on cue, we had a couple guest columnists provide articles about capital efficiency and recession-proofing your company. Shin Kim has a two-parter on TechCrunch and Extra Crunch, where he breaks down why most tech IPOs are not WeWork (in a good way) and how to pace your own fundraising regardless of anything else going on.
Schwark Satyavolu, meanwhile, digs into the best practices for startups in the next recession for Extra Crunch, starting with this brutal real-life intro:
I founded my first startup, Yodlee, in a strong economy with almost 20 competitors. Ten years and a painful recession later, we were the only game in town. Critical to our success was acquiring our largest competitor, something we never could have done in a strong economy because they never would have been willing to sell. The recession made it untenable for them to fundraise, enabling us not only to buy them, but to do so without cash in an all-equity deal.
Board representation is a hot topic for companies of all sizes and none other than Goldman Sachs said this week that it would only take companies public that had at least one underrepresented board member.
CEO David Solomon said that companies that had gone public in the last four years with at least one female board member did significantly better than those without, but Megan Dickey notes for Extra Crunch that’s not quite all the way towards the goal:
But the lack of people of color on boards is perhaps a more urgent issue. Late last year, a Crunchbase study found that 60% of the most funded VC-backed startups don’t have a single woman on their board of directors. But there are even fewer black people, let alone black women, on boards. A 2018 Deloitte study found that of the Fortune 100 companies, white men held 61.4% of board seats, white women held 19.1%, men of color had 13.7% of board seats and women of color had just 5.8% of board seats.
Connie Loizos, meanwhile, writes for TechCrunch that boards themselves are not all of the way towards the goal:
Let’s be real here. Directors of public companies typically meet just four times a year to review quarterly results. It’s important and necessary, sure. But beyond ensuring that strategic objectives are being met and hopefully making useful introductions to the company, these roles are assigned more importance by industry watchers than they should. (They often pay ludicrous amounts given the work involved, too.)
Even pledging that Goldman is only going to take public companies that give back — say 1% of future profits to the NAACP, as one idea — would instantly put the bank in pole position for those founders and investors who truly want to be progressive. Goldman might miss out on a lot of business in the immediate term, we realize, but we’re guessing it’s a gamble that would pay off over time.
Why Front’s latest investment (a $59 million Series C) is a pretty big deal. Not because of how much money it has raised — the firm has raised more in a single, preceding round — but because of who put the capital to work.
On the venture capital front, Danny and Alex also chewed over signaling risk in venture, and why bigger funds are writing earlier and earlier checks.
Also on the docket was the latest from Lambda School, which our former co-host and friend Kate Clark wrote. The gist is that regardless of how you feel about the company, your views are probably a bit too negative, or a bit too positive. (More on the company’s ilk from Extra Crunch here, and here.)
And three media deals, including The Athletic’s latest investment ($50 million), who might buy the company behind the hit podcast “Serial” and why Spotify might buy The Ringer. Which is about sports, it turns out.
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The startup community has lost another moral leader today.
Leila Janah, a serial entrepreneur who was the CEO and founder of machine learning training data company Samasource, passed away at the age of 37 due to complications from Epithelioid Sarcoma, a form of cancer, according to a statement from the company.
She focused her career on social and ethical entrepreneurship with the goal of ending global poverty, founding three distinct organizations over her career spanning the for-profit and non-profit worlds. She was most well-known for Samasource, which was founded a little more than a decade ago to help machine learning specialists develop better ML models through more complete and ethical training datasets.
Janah and her company were well ahead of their time, as issues related to bias in ML models have become top-of-mind for many product leaders in Silicon Valley today. My TechCrunch colleague Jake Bright had just interviewed Janah a few weeks ago, after Samasource raised more than $15 million in venture capital, according to Crunchbase.
In its statement, the company said:
We are all committed to continuing Leila’s work, and to ensuring her legacy and vision is carried out for years to come. To accomplish this, Wendy Gonzalez, longtime business partner and friend to Leila, will take the helm as interim CEO of Samasource. Previously the organization’s COO, Wendy has spent the past five years working alongside Leila to craft Samasource’s vision and strategy.
In addition to Samasource, Janah founded SF-based Samaschool, a 501(c)(3) nonprofit dedicated to helping low-income workers learn critical freelancing skills by helping them negotiate the changing dynamics in the freelance economy. The organization has built partnerships with groups like Goodwill to empower them to offer additional curricular resources within their own existing programs and initiatives.
Janah also founded LXMI, a skin-care brand that emphasized organic and fair-trade ingredients, with a focus on sourcing from low-income women’s cooperatives in East Africa. Founded three years ago, the company raised a seed round from the likes of NEA, Sherpa, and Reid Hoffman according to Crunchbase.
Across all of her initiatives, Janah consistently put the concerns of under-represented people at the forefront, and designed organizations to empower such people in their daily lives. Her entrepreneurial spirit, commitment, and integrity will be sorely missed in the startup community.
If a thousand companies make their own smart light bulb, do a thousand companies also have to design a light switch app to control them?
Kraftful, a company out of Y Combinator’s Summer 2019 class, doesn’t think so. Kraftful builds the myriad components that an IoT/Smart Home company might need, puzzle piecing them together into apps for each company without requiring them to reinvent the light switch (or the pad lock button, or the smart thermostat dial) for the nth time.
Because no company wants an app that looks identical to a competitor’s, much of what Kraftful does is built to be tailored to each company’s branding — all the surface level stuff, like iconography, fonts, colors, etc. are all customizable. Under the hood, though, everything is built to be reusable.
This focus on finding the parts that can be built once makes sense, especially given the team’s background. CEO Yana Welinder and CTO Nicky Leach were previously Head of Product and a Senior Engineer, respectively, at IFTTT — the web service made up of a zillion reusable, interlinking “recipe” applets that let you hook just about anything (Gmail, Instagram, your cat’s litterbox, whatever) into anything else to let one trigger actions on the other.
Kraftful founders Nicky Leach and Yana Welinder
So why now? More smart devices are coming onto the market every day, many of them from legacy appliance companies who don’t have much (or any) history in building smartphone apps. Good apps are the exception — the Philips Hue app is one of the better ones out there, and even it’s a little wonky sometimes. Many of them are… real bad.
Bad apps get bad App Store reviews, and bad reviews dent sales. And even for those who dive in and buy it without checking the reviews first, bad apps means returned devices. According to this iQor survey from 2018, 22% of smart home customers give up and return the products before getting them to work.
“We kind of looked around and realized that 80% of all smart home apps have zero, one, or two stars on the app store,” Welinder tells me.
Knowing what’s working and what’s not with buyers is a strength of Kraftful’s approach; behind the scenes, they can run all sorts of analytics on how users are actually interacting with components in the apps they’re powering and adjust all of them accordingly. If they make a tweak to the setup process in one app, do more users actually get all the way through it? Great. Now roll that out everywhere.
“If you look at some of the leading smart lock apps, they all have very… very similar interfaces. They’ve basically gotten to a standardized user experience, but they’ve all be developed individually.” says Welinder. “So all of these companies are spending the resources designing and developing these apps, but they’re not getting the benefit of being standardized across the board and being able to leverage data from all of these apps to be able to improve them all at once”
Kraftful builds the app for both iOS and Android, tailors it to the brand’s needs, offers cloud functionality like push notifications and activity history, provides analytics for insights on how users are actually using an app, and keeps everything working as OS updates roll out and as device display sizes grow ever larger.
Of course, the entire concept of a dedicated app for a smart home device has some pretty fierce competition — between Apple’s Homekit and Google Home, the platform makers themselves seem pretty set on gobbling up much of the functionality. But most buyers still expect their shiny devices to have their own apps — something branded and purpose-built, something for the manual to point them to. Power users, meanwhile, will always want to do things beyond what the all-encompassing solutions like Homekit/Home are built for.
Folks at Google seem to agree with Kraftful’s approach, here — the team counts the Google Assistant Investments Program as one of the investors in the $1 million they’ve raised. Other investors include YC, F7 Ventures, Cleo Capital, Julia Collins (co-founder of Zume Pizza and Planet Forward), Lukas Biewald (co-founder of CrowdFlower), Nicolas Pinto (co-founder of Perceptio) and a number of other angel investors.
Welinder tells me they’re already working with multiple companies to start powering their apps; NDAs prevent her from saying who, at this point, but she notes that they’re “some of the largest brands that provide smart lights, plugs/switches, thermostats, and other smart home products.”
We are living through one of the nation’s longest periods of economic growth. Unfortunately, the good times can’t last forever. A recession is likely on the horizon, even if we can’t pinpoint exactly when. Founders can’t afford to wait until the midst of a downturn to figure out their game plans; that would be like initiating swim lessons only after getting dumped in the open ocean.
When recession inevitably strikes, it will be many founders’ — and even many VCs’ — first experiences navigating a downturn. Every startup executive needs a recession playbook. The time to start building it is now.
While recessions make running any business tough, they don’t necessitate doom. I co-founded two separate startups just before downturns struck, yet I successfully navigated one through the 2000 dot-com bust and the second through the 2008 financial crisis. Both companies not only survived but thrived. One went public and the second was acquired by Mastercard.
I hope my lessons learned prove helpful to building your own recession game plan.
In entrepreneurship, the goal isn’t just to survive; it’s to win. Some founders think that surviving recession amounts to hoarding cash and sitting out the financial winter. While there’s wisdom in hoarding cash (see below), I strongly recommend against sitting idly when that time could be actively leveraged to strengthen competitive advantage.
I founded my first startup, Yodlee, in a strong economy with almost 20 competitors. Ten years and a painful recession later, we were the only game in town. Critical to our success was acquiring our largest competitor, something we never could have done in a strong economy because they never would have been willing to sell. The recession made it untenable for them to fundraise, enabling us not only to buy them, but to do so without cash in an all-equity deal. I recommend thinking ahead of time about which companies you would want to buy if the opportunity arose, and your goals for doing so, such as consolidating competition, acquiring customers or engineering talent, entering new markets or strengthening product offerings or distribution channels.
You can’t rebuild a plane when you’re traveling 500 miles per hour. During a strong economy, companies spend most of their energy on sales and growth. During a weaker economy, it’s easier to justify the investment in infrastructure and technical debt. Yodlee was built on PERL, which we knew would eventually need upgrading. Once the downturn hit, we took advantage of the slower sales cycles to totally retool in Java, an enterprise-class programming language capable of scale. And we didn’t stop there — we created six new products during the downturn.
The precipice of a recession is not the time to over-index on top-line revenue. You never want to be on your customers’ top five lists of easiest-to-cut products and services. Instead, take the time to understand your customers’ needs, embed yourself deeply in their operations or customer experience and invest significantly in top-notch customer success.
At my second startup, Truaxis, once recession struck, we pivoted from credit card customer acquisition for banks (which requires no help during a recession) to helping banks address churn. Our revised offering yielded a tremendous ROI for banks — a 10X increase in profit. Our product also became the cornerstone to their online consumer banking experience. If you figure out how to make your product indispensable or core to the customer experience, it won’t get cut, even during a recession.
Both of my companies started out with B2C business models. After each recession hit, I quickly pivoted to B2B2C. Here’s why: While consumers can react immediately to economic jitters, businesses must keep spending in order to keep operating. Plus, they work on annual budget cycles. Even when businesses want to reduce their costs, they typically can’t react very quickly because they have to wait out their contracts.
In a bull economy, short-term contracts are popular because they enable companies to keep raising prices. Don’t be tempted by short-term cash. B2B and B2B2C firms should take the potential revenue hit by locking in long-term contracts now while budgets and buyers are flush.
While the economy is still healthy, explore options for diversifying your revenue streams and customer bases to more recession-resistant segments. If your business is consumer-focused, consider a different distribution model via businesses or new consumer segments like affluent populations, which are less sensitive to economic fluctuations. If you have an enterprise-focused business, transition more of your revenue to larger enterprises, which are more financially resilient than smaller ones, or to enterprises that need your service for survival, especially in a down market.
Key to the diversification strategy is plotting your axis ahead of time. You don’t want to start your exploration when the market has already turned and you’re burning cash faster than you can get it. Upon exploration, you may find that no pivot is necessary — perhaps only the need to slow down. Now is the time to look for and deeply understand the signals in your business, though you may not need to act on them for a while — or perhaps even ever.
It’s obviously a lot easier to raise money in a healthy economy than a weak one. If your coffers aren’t full going into a downturn, it doesn’t matter what you do; you’ve lost the game right there. Having enough cash can make the difference between emerging as the market leader (i.e. the only one still with cash in the bank) and going out of business — even if your company would have thrived in a strong economy. Be conservative when projecting how much money you’ll need to stay afloat. Many leaders underestimate how much elongated sales cycles, diminished average deal sizes and dwindling total sales transactions weaken total revenue.
I’m supportive of founders seeking aggressive valuations, but it’s important to realize the potential downside. Valuations soften during recessions, which can lead to corrections or recapitalizations. Recapitalizations create new companies in which the old stock is worth nearly nothing, leaving many employees’ options under water.
I learned this the hard way at Yodlee after raising a lot of money at a high valuation in 1999. We banked enough money that we could have lasted through most downturns without fundraising. Alas, while the average recession lasts 11 months, the dot-com crash lasted several years. Even though we were strong enough to fundraise during the recession, our high valuation forced us to recapitalize. This was crushing for the employees whose equity was suddenly worthless.
In a weak economy, startups struggle to retain their strongest employees who often retreat for safer work environments and more predictable incomes. Recapitalizations deliver an unwanted shove out the door to demoralized employees who feel they have no reason to stay. Inevitably after recapitalizations the people who are strong enough to get hired elsewhere do so. Surviving a downturn is challenging enough. Doing so without a strong, motivated team is nearly impossible.
When my Yodlee board members suggested we pivot from B2C to B2B2C, I thought they were crazy. We had acquired 1 million users through word of mouth in only two-three months. I couldn’t believe they advocated such a significant pivot when things were going so well. I eventually came to understand that these seasoned board members were actually saving my business.
As my colleague Karan Mehandru said, “investors are your war partners, not your beer buddies.” When fundraising, think carefully about who you want around the table if the economy goes south. I recommend asking potential investors if they’ve weathered downturns before and how they’d help you navigate one. I’d ask the same questions of the firm’s other partners to look for consistency of answers and to gauge your investors’ standing and seniority within the partnership. All too many board members are lovely when companies grow rapidly, but challenging when speed bumps arise. Will your board members actively help you address these challenges or stand in passive judgment?
Being a founder is hard enough, but leading a startup through a recession catapults an already challenging job to a whole different level. Whether the recession begins tomorrow or in four years, I hope you’ll learn from my experience and be prepared either way.
Los Angeles is one of the most desirable locations for commercial real estate in the United States, so it’s little wonder that there’s something of a boom in investments in technology companies servicing the market coming from the region.
It’s one of the reasons that CREXi, the commercial real estate marketplace, was able to establish a strong presence for its digital marketplace and toolkit for buyers, sellers and investors.
Since the company raised its last institutional round in 2018, it has added more than 300,000 properties for sale or lease across the U.S. and increased its user base to 6 million customers, according to a statement.
It has now raised $30 million in new financing from new investors, including Mitsubishi Estate Company (“MEC”), Industry Ventures and Prudence Holdings . Previous investors Lerer Hippeau Ventures and Jackson Square Ventures also participated in the financing.
CREXi makes money three ways. There’s a subscription service for brokers looking to sell or lease property; an auction service where CREXi will earn a fee upon the close of a transaction; and a data and analytics service that allows users to get a view into the latest trends in commercial real estate based on the vast collection of properties on offer through the company’s services.
The company touts its service as the only technology offering that can take a property from marketing to the close of a sale or lease without having to leave the platform.
According to chief executive Mike DeGiorgio, the company is also recession-proof thanks to its auction services. “As more distressed properties hit the market, the best way to sell them is through an online auction,” DeGiorgio says.
So far, the company has seen $700 billion of transactions flow through the platform, and roughly 40% of those deals were exclusive to the company.
“The CRE industry is evolving, and market players, especially younger, digitally native generations are seeking out platforms that provide free and open access to information,” said Gavin Myers, general partner at Prudence Holdings, in a statement. “CREXi directly addresses this market need, providing fair access to a range of CRE information. As CREXi continues to build out its stable of services, features, and functionality, we’re thrilled to partner with them and support the company’s continued momentum.”
CREXi joins the ranks of startups based in Los Angeles that have raised money to reshape the real estate industry. Estimates from Built in LA count roughly 127 companies, which have raised in excess of $2.4 billion, active in the real estate industry in Los Angeles. These companies range from providers of short-term commercial office space, like Knotel, or co-working companies like WeWork, to companies focused on servicing the real estate industry like Luxury Presence, which raised a $5 million round earlier in the year.
Due to inaccurate information provided by the company, an initial version of this story indicated that CREXi had raised $29 million in its Series B round. The correct number is $30 million.
Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.
SaaS stocks had a good run in late 2019. TechCrunch covered their ascent, a recovery from early-year doldrums and a summer slowdown. In 2020 so far, SaaS and cloud stocks have surged to all-time highs. The latest records are only a hair higher than what the same companies saw in July of last year, but they represent a return to form all the same.
Given that public SaaS companies have now managed to crest their prior highs and have been rewarded for doing so with several days of flat trading, you might think that there isn’t much room left for them to rise. Not so, at least according to Atlassian . The well-known software company reported earnings after-hours yesterday and the market quickly pushed its shares up by more than 10%.
Why? It’s worth understanding, because if we know why Atlassian is suddenly worth lots more, we’ll better grok what investors — public and private — are hunting for in SaaS companies and how much more room they may have to rise.
Founder Andreas Kröpfl has spent almost a decade hard-grafting in the b2b unified communications space, building a videoconferencing business with a patented single-stream system and a claim of no ‘drop-offs’ thanks to “unique low-bandwidth technology”.
His Austria-based startup’s current web-based videoconferencing system, eyeson (née Visocon), which launched in 2018, has had some nice traction since launch, as he tells it, garnering a few million customers and getting a nomination nod as a Gartner Cool Vendor last year.
Eyeson’s website touts ‘no hassle, no, lag, no downloads’ video calls. Pricing options for the target b2b users run the gamut from freelance pro to full-blown enterprise. While the business itself has pulled in a smidge less than $7M in investor funding over the years.
But when TechCrunch came across Kröpfl last December, pitching hard in startup alley at Disrupt Berlin, he was most keen to talk about something else entirely: Video dating.
That’s because last summer the team decided to branch out by building their own video dating app, reusing their core streaming tech for a consumer-focused social experiment. And after a period of internal beta testing — which hopefully wasn’t too awkward within a small (up-til-then) b2b-focused team — they launched an experimental dating app in November in India.
The app, called Ahoi, is now generating 100,000 video calls and 250,000 swipes per day, says Kröpfl.
This is where he breaks into a giggle. The traction has been crazy, he says.
In the staid world of business videoconferencing you can imagine eyeson’s team eyeing the booming growth of certain consumer-focused video products rather enviously.
Per Kröpfl, they had certainly noticed different desires among their existing users — which pushed them to experiment. “We saw that private people like the simple fun features (GIF reactions, …) and that business meetings were more focused on ‘drop-off’ [rates] and business features,” he tells us. “To improve both in one product was not working any more. So eyeson goes business plus SaaS.”
“Cloning eyeson but make it social,” is how he sums up the experiment.
Ahoi is very evidently an MVP at this stage. It also looks like a pretty brave and/or foolish (depending on your view) full-bore plunge into video dating, with nothing so sophisticated as a privacy screen to prevent any, er, unwanted blushes… (Whereas safety screening is an element we’ve recently seen elsewhere in the category — see: Blindlee.)
There’s also seemingly no way for users to specify the gender they wish to talk to.
Instead, Ahoi users state interests by selecting emoji stickers — such as a car, cat, tennis racket, games console or globetrotter. And, well, it goes without saying that even if you like cars a lot you’re unlikely to change your sexual orientation over the category.
There are no generic emoji that could be used to specify a sexual interest in men or women. But, er, there’s a horse…
Such limits may explain why Ahoi is generating so many early swipes — and rather fewer actual calls — in that the activity sums to (mostly) men looking for women to videochat with and being matched with, er, men.
And frustration, sexual or otherwise, probably isn’t the greatest service to try and sell.
Still, Kröpfl reckons they’ve landed on a winning formula that makes handy reuse of their core videoconferencing tech — letting them growth hack in a totally new category. Swipe right to video date.
“People are disappointed by perfect profiles on Tinder and the reality when meeting people,” he posits. “Wasted time. Especially women do not want to be stalked by men pretending to be someone else. We solve both by a real live conversation where only after a call both can decide to be connected or never see each other again.”
Notably, marketing around the app does talk rather fuzzily about it being a way to “find new pals”.
So while Kröpfl frames the experiment as dating, the reality of the product is more ‘open to options’. Think of it as a bit like Chatroulette — just with slightly more control (in that you have a few seconds to decide if you don’t want to talk to the next in-app match).
The very short countdown timer (you get just five seconds to opt out of a matched video chat) is very likely generating a fair number of unintended calls. Though such high velocity matching might appeal to a certain kind of speed dating addict.
Kröpfl says Ahoi has been seeing up to 20,000 new users added daily. They’re bullishly targeting 3M+ users this year, and already toying with ideas for turning video dates into a money spinner by offering stuff like premium subscriptions and/or video ads. He says the plan is to turn Ahoi into a business “step by step”.
“Everyone loves to make his profile better,” he suggests, floating monetization options down the line. Quality filtering for a fee is another possibility (“everyone is annoyed by being connected to the wrong people”).
They picked India for the test launch because it has a lot of people on the same timezone, a large active mobile user-base and cheap marketing is still “easily possible”. He also says that dating apps seemed popular there, in their experience. (Albeit, the team presumably didn’t have a great deal of relevant experience in this category — given Ahoi is an experiment.)
The intent is also to open Ahoi up to other markets in time too, once they get more accustomed to dealing with all the traffic. Kröpfl notes they had to briefly take the app off the store last month, as they worked on adding more server capability.
“It is very early and we were not prepared for this usage,” he says, admitting they’ve been “struggling to work on early feedbacks”. “We had to make it invisible temporarily — to improve server capacity and stability.”
The contrast in pace of uptake between the stolid (but revenue-generating) world of business meeting-fuelled videoconferencing and catnip consumer dating — which is money-sucking unless or until you can hit a critical mass of usage and get the chance to try applying monetization strategies — does sound like it’s been rather irresistible to Kröpfl.
Asked what it feels like to go from one category to the other he says “crazy, surprised and thrilling”, adding: “It is somehow also frustrating when all the intense b2b work is not as closely interesting to people as Ahoi is. But amazing that it is possible thanks to an extremely focused and experienced team. I love it.”
TechCrunch’s Manish Singh agreed to brave the local video dating app waters in India to check Ahoi out for us.
He reported back not having seen any women using the app. Which we imagine might be a problem for Ahoi’s longer term prospects — at least in that market.
“I spoke with one guy, who said his friend told him about the app. He said he joined to talk to girls but so far, he is only getting matched with boys,” said Singh. “I saw several names appear on the app, but all of them were boys, too.”
He told us he was left wondering “why people are on these apps, and why they have so much free time on a weekday”.
For ‘people’ it seems safe to conclude that most of Ahoi’s early adopters are men. As the Wall Street Journal reported back in 2018, India’s women are famously cool on dating apps — in that they’re mostly not on them. (We asked Kröpfl about Ahoi’s gender breakdown but he didn’t immediately get back to us on that. Update: We’re told the app’s male to female ratio is 85:15. “India is challenging,” Kröpfl admits.)
That market quirk means those female users who are on dating apps tend to get bombarded with messages from all the lonely heart guys with not much to swipe. Which, in turn, could make a video dating app like Ahoi an unattractive prospect to female users — if there’s any risk at all of being inundated with video chats.
And even if there are enough in-app controls to prevent unwelcome inundation by default, women also might not feel like they want their profile to be seen by scores of men simply by merit of being signed up to an app — as seems inevitable if the gender balance is so skewed.
Add to that, if the local perception among single women is that men on dating apps are generally a turn-off — because they’re too eager/forward — then jumping into any unmoderated video chat is probably not the kind of safe space these women are looking for.
No matter, Kröpfl and his team are clearly having far too much fun growth hacking in an unfamiliar, high velocity consumer category to sweat the detail.
What’s driving Ahoi’s growth right now? “Performance marketing mainly,” he says, pointing also to “viral engagement by sharing and liking profiles”.
Notably, there are a lot of reviews of Ahoi on Google Play already — an unusual amount for such an early app. Many of them appear to be five star write-ups from accounts with European-sounding names and a sometimes robotic grasp of language.
“Eventhough Ahoi has been developed recently, it had high quality for user about calling, making friends and widing your knowlegde [sic],” writes one reviewer with atrocious spelling whose account is attached to the name ‘Dustin Stephens.’
“Talking with like minded people and same favor will creat a fun and interesting atmosphere. Ahoi will manage for you to call like condition above,” says another apparently happy but not entirely clear user, going by the name ‘Elisa Herring’.
There’s also a ‘Madeleine Mcghin’, whose profile uses a photo of the similarly named child who infamously disappeared during a holiday in Portugal in 2007. “My experience with this app was awesome,” this individual writes. “It gives me the option to find new people in every country.”
Another less instantly tasteless five-star reviewer, ‘Stefania Lucchini’, leaves a more surreal form of praise. “A good app and it will bring you extra income, I would say it’s a great opportunity to have AHOI and be a part of it but it’s that it will automatically ban you even if you don’t show it. Marketing. body part, there are still 5 stars for me,” she (or, well, ‘it’) writes.
Among the plethora of dubious five-star reviews a couple of one-star dunks stand out — not least because they come from accounts with names that sound like they might actually come from India. “Waste u r time,” says one of these, who uses the name Prajal Pradhan.
This pithy drop-kick has been given a full 72 thumbs-up by other Play Store users.
We’re down in Sunnyvale, CA today, where Alchemist Accelerator is hosting a demo day for its most recent batch of companies. This is the 23rd class to graduate from Alchemist, with notable alums including LaunchDarkly, MightyHive, Matternet, and Rigetti Computing. As an enterprise accelerator, Alchemist focuses on companies that make their money from other businesses, rather than consumers.
21 companies presented in all, each getting five minutes to explain their mission to a room full of investors, media, and other founders.
Here are our notes on all 21 companies, in the order in which they presented:
i-50: Uses AI to monitor human actions on production lines, using computer vision to look for errors or abnormalities along the way. Founder Albert Kao says that 68% of manufacturing issues are caused by human error. The company currently has 3 paid pilots, totalling $190k in contracts.
Perimeter: A data visualization platform for firefighters and other first responders, allowing them to more quickly input and share information (such as how a fire is spreading) with each other and the public. Projecting $1.7M in revenue within 18 months.
Einsite: Computer vision-based analytics for mining and construction. Sensors and cameras are mounted on heavy machines (like dump trucks and excavators). Footage is analyzed in the cloud, with the data ultimately presented to job site managers to help monitor progress and identify issues. Founder Anirudh Reddy says the company will have $1.2M in bookings and be up and running on 2100 machines this year.
Mall IQ: A location-based marketing/analytics SDK for retail stores and malls to tie into their apps. Co-founder Batu Sat says they’ve built an “accurate and scalable” method of determining a customer’s indoor position without GPS or additional hardware like Bluetooth beacons.
Ipsum Analytics: Machine learning system meant to predict the outcome of a company’s ongoing legal cases by analyzing the relevant historical cases of a given jurisdiction, judge, etc. First target customer is hedge funds, helping them project how legal outcomes will impact the market.
Vincere Health: Works with insurance companies to pay people to stop smoking. They’ve built an app with companion breathalyzer hardware; each time a user checks in with the breathalyzer to prove they’re smoking less, the user gets paid. They’ve raised $400k so far.
Harmonize: A chat bot system for automating HR tasks, built to work with existing platforms like Slack and Microsoft Teams. An employee could, for example, message the bot to request time off — the request is automatically forwarded to their manager, presenting them with one-click approve/deny buttons which handle everything behind the scenes. The company says it currently has 400 paying customers and is seeing $500k in ARR, projecting $2M ARR in 2020.
Coreshell Technologies: Working on a coating for lithium-Ion batteries which the company says makes them 25% cheaper and 50% faster to produce. The company’s co-founder says they have 11 patents filed, with 2 paid agreements signed and 12 more in the pipeline.
in3D: An SDK for 3D body scanning via smartphone, meant to help apps do things like gather body measurements for custom clothing, allow for virtual clothing try-ons, or create accurate digital avatars for games.
Domatic: “Intelligent power” for new building construction. Pushes both data and low-voltage power over a single “Class 2” wire , making it easier/cheaper for builders to make a building “smart”. Co-founder Jim Baldwin helped build Firewire at Apple, and co-founder Gladys Wong was previously a hardware engineer at Cisco.
MeToo Kit: a kit meant to allow victims of sexual assault or rape to gather evidence through an at-home, self-administered process. Co-founder Madison Campbell says that they’ve seen 100k kits ordered by universities, corporations, non-profits, and military organizations. The company garnered significant controversy in September of 2019 after multiple states issued cease-and-desist letters, with Michigan’s Attorney General arguing that such a kit would not be admissible in court. Campbell told Buzzfeed last year that she would “never stop fighting” for the concept.
AiChemist Metal: Building a thin, lightweight battery made of copper and cellulose “nanofibers”. Co-founder Sergey Lopatin says the company’s solution is 2-3 lighter, stronger, and cheaper than alternatives, and that the company is projecting profitability in 2021. Focusing first on batteries for robotics, flexible displays, and electric vehicles.
Delightree: A task management system for franchises, meant to help owners create and audit to-dos across locations. Monitors online customer reviews, automatically generating potential tasks accordingly. In pilot tests with 3 brands with 16 brands on a waitlist, which the company says translates to about $400k in potential ARR.
DigiFabster: A ML-powered “smart quoting” tool for manufacturing shops doing things like CNC machining to make custom parts and components. Currently working with 125 customers, they’re seeing $500k in ARR.
NachoNacho: Helps small/medium businesses monitor and manage software subscriptions their employees sign up for. Issues virtual credit cards which small businesses use to sign up for services; you can place budgets on each card, cancel cards, and quickly determine where your money is going. Launched 9 months ago, NachoNacho says it’s currently working with over 1600 businesses.
Zapiens: a virtual assistant-style tool for sharing knowledge within a company, tied into tools like Slack/Salesforce/Microsoft 365. Answers employee questions, or uses its understanding of each employee’s expertise to find someone within the company who can answer the question.
Onebrief: A tool aiming to make military planning more efficient. Co-founder/Army officer Grant Demaree says that much of the military’s planning is buried in Word/Powerpoint documents, with inefficiencies leading to ballooning team sizes. By modernizing the planning approach with a focus on visualization, automation and data re-usability, he says planning teams could be smaller yet more agile.
Perceive: Spatial analytics for retail stores. Builds a sensor that hooks into existing in-store lighting wiring to create a 3D map of stores, analyzing customer movement/behavior (without face recognition or WiFi/beacon tracking) to identify weak spots in store layout or staffing.
Acoustic Wells: IoT devices for monitoring and controlling production from oil fields. Analyzes sound from pipes “ten thousand feet underground” to regulate how a machine is running, optimizing production while minimizing waste. Charges monthly fee per oil well. Currently has letters of intent to roll out their solution in over 1,000 wells.
SocialGlass: A marketplace for government procurement. Lets governments buy goods/services valued under $10,000 without going through a bidding process, with SocialGlass guaranteeing they’ve found the cheapest price. Currently working with 50+ suppliers offering 10,000 SKUs.
Applied Particle Technology: Continuous, realtime worker health/safety tracking for industrial environments. Working on wireless, wearable monitors that stream environmental data to identify potential exposure risks. Focusing first on mining and metals industries, later moving into construction, firefighting, and utilities environments.
As the number of drones proliferates in cities and towns across America, government agencies are scrambling to find ways to manage the oncoming traffic that’s expected to clog up their airspace.
Companies like Airmap and KittyHawk have raised tens of millions to develop technologies that can help cities manage congestion in the friendly skies, and now they have a new competitor in the Detroit-based startup, Airspace Link, which just raised $4 million from a swarm of investors to bring its services to the broader market.
The financing for Airspace Link follows the company’s reception of a stamp of approval from the Federal Aviation Administration for low-altitude authorization and notification capabilities, according to chief executive Michael Healander.
According to Healander, what distinguishes Airspace Link from the other competitors in the market is its integration with mapping tools used by municipal governments to provide information on ground-based risk.
“We’re creating the roads based on ground-based risk and we push that out into the drone community to let them know where it’s okay to fly,” says Healander.
That knowledge of terrestrial critical assets in cities and towns comes from deep integrations between Airspace Link and the mapping company ESRI, which has long provided federal, state and local governments with mapping capabilities and services.
“We’ve just spent the past month understanding what regulation is going to be around to support it. In two years from now every drone will be live tracked in our platform,” says Healnder. “Today we’re just authorizing flight plans.”
As drone operators increase in number, the autonomous vehicles pose more potential risks to civilian populations in the wrong hands.
Parking lots, sporting events, concerts — really any public area — could be targets for potential attacks using drones.
“Drones are becoming more and more powerful and smarter,” EU Security Commissioner Julian King warned in a statement last summer, “which makes them more and more attractive for legitimate use, but also for hostile acts.”
Already roughly half of the population of the U.S. lives in controlled airspace where drones flying with more than a half a pound of weight require flight plan authorization, according to Healander.
“We build out population data and give state and local governments a tool to create advisories for emergency events or any areas where high densities of people will be,” says Healander. “That creates an advisory that goes through our platform to the drone industry.”
Airspace Link closed a $1 million pre-seed round in September 2019 with a $6 million post-money valuation. The current valuation of the company is undisclosed, but the company’s progress was enough to draw the attention of investors led by Indicator Ventures with participation from 2048 Ventures, Ludlow Ventures, Matchstick Ventures, Detroit Venture Partners and Invest Detroit.
For Healander, Airspace Link is only the latest entrepreneurial venture. He previously founded GeoMetri, an indoor GPS tracking company, which was acquired by Acuity Brands.
I’ve been a partner of ESRI my entire life,” says Healander. “I’ve been in the geospatial industry for four or five companies with them.”
The company has four main components of its service. There’s AirRegistry, where people can opt-in or out of receiving drone deliveries; AirInspect, which is a service that handles city and state permitting for drone operators; AirNetm, which works with the FAA to create approved air routes for drones; and AirLink, an API that connects drone operators with local governments and collects fees for registering drones.
Layoffs in the technology and venture-backed worlds continued today, as 23andMe confirmed to CNBC that it laid off around 100 people, or about 14% of its formerly 700-person staff. The cuts would be notable by themselves, but given how many other reductions have recently been announced, they indicate that a rolling round of belt-tightening amongst well-funded private companies continues.
Mozilla, for example, cut 70 staffers earlier this year. As TechCrunch’s Frederic Lardinois reported earlier in January, the company’s revenue-generating products were taking longer to reach market than expected. And with less revenue coming in than expected, its human footprint had to be reduced.
23andMe and Mozilla are not alone, however. Playful Studios cut staff just this week, 2019 itself saw more than 300% more tech layoffs than in the preceding year and TechCrunch has covered a litany of layoffs at Vision Fund-backed companies over the past few months, including:
Scooter unicorns Lime and Bird have also reduced staff this year. The for-profit drive is firing on all cylinders in the wake of the failed WeWork IPO attempt. WeWork was an outlier in terms of how bad its financial results were, but the fear it introduced to the market appears pretty damn mainstream by this point. (Forsake hope, alle ye whoe require a Series H.)
The money at risk, let alone the human cost, is high. Zume has raised more than $400 million. 23andMe has raised an even sharper $786.1 million. Rappi? How about $1.4 billion. And Oyo? $3.2 billion so far. Every company that loses money eventually dies. And every company that always makes money lives forever. It seems that lots of companies want to jump over the fence, make some money and rebuild investor confidence in their shares.
It’s just too bad that the rank-and-file are taking the brunt of the correction.
It’s one thing to develop a working machine learning model, it’s another to put it to work in an application. Cortex Labs is an early stage startup with some open source tooling designed to help data scientists take that last step.
The company’s founders were students at Berkeley when they observed that one of the problems around creating machine learning models was finding a way to deploy them. While there was a lot of open source tooling available, data scientists are not experts in infrastructure.
CEO Omer Spillinger says that infrastructure was something the four members of the founding team — himself, CTO David Eliahu, head of engineering Vishal Bollu and head of growth Caleb Kaiser — understood well.
What the four founders did was take a set of open source tools and combine them with AWS services to provide a way to deploy models more easily. “We take open source tools like TensorFlow, Kubernetes and Docker and we combine them with AWS services like CloudWatch, EKS (Amazon’s flavor of Kubernetes) and S3 to basically give one API for developers to deploy their models,” Spillinger explained.
He says that a data scientist starts by uploading an exported model file to S3 cloud storage. “Then we pull it, containerize it and deploy it on Kubernetes behind the scenes. We automatically scale the workload and automatically switch you to GPUs if it’s compute intensive. We stream logs and expose [the model] to the web. We help you manage security around that, stuff like that,” he said
While he acknowledges this not unlike Amazon SageMaker, the company’s long-term goal is to support all of the major cloud platforms. SageMaker of course only works on the Amazon cloud, while Cortex will eventually work on any cloud. In fact, Spillinger says that the biggest feature request they’ve gotten to this point, is to support Google Cloud. He says that and support for Microsoft Azure are on the road map.
The Cortex founders have been keeping their head above water while they wait for a commercial product with the help of an $888,888 seed round from Engineering Capital in 2018. If you’re wondering about that oddly specific number, it’s partly an inside joke — Spillinger’s birthday is August 8th — and partly a number arrived at to make the valuation work, he said.
For now, the company is offering the open source tools, and building a community of developers and data scientists. Eventually, it wants to monetize by building a cloud service for companies who don’t want to manage clusters — but that is down the road, Spillinger said.
Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.
Today we’re digging into One Medical’s updated IPO filing released this week. The document contains directional pricing information that will help us understand where the tech-enabled medical care startup expects the market to value itself and also details its Q4 2019 Preliminary Estimated Unaudited Financial Results, which gives us a fuller picture of its financial health.
As we’ll see, One Medical’s expected valuation matches secondary-market transactions in the firm’s equity, and, at the upper-end of its proposed IPO range, represents a solid boost to its final private valuation. Afterwards, we’ll dig back through the company’s numbers, figure out its implied revenue multiple and make a bullish and bearish argument for the company’s hoped-for IPO valuation.
It’s going to be fun! (For a general dive into the company’s IPO filing, head here.)
Early Stage SF is sneaking up on us and there is plenty to be excited about. The one-day event, which brings together a wide variety of startup experts to host breakout sessions, is going down on April 28 and we have a handful of speakers to announce.
So without any further ado:
Jeff Clavier is Managing Partner and founder at Uncork Capital, with portfolio companies that include Eventbrite, Sendgrid, Fitbit, Vungle, and Mint.com. His current investments include Vidyard, Postmates, Molekule, Shippo and Front.
There are now a thousand micro-VCs entrepreneurs can raise capital from, creating confusing market dynamics. Learn tips and tricks on fund raising from Uncork Capital’s Managing Partner, Jeff Clavier.
Sarah Guo joined Greylock Partners in 2013 and led the firm’s investments in Cleo, Demisto, Sqreen, and Utmost, and sits on the boards of several startups. Before Greylock, she was at Goldman Sachs where she invested at the growth level in companies like Dropbox, and advised pre-IPO tech companies and public tech companies alike, including Workday (the former) and Netflix, Zynga and Nvidia (the latter).
Sarah Guo, Partner at Greylock is an early stage investor in enterprise software, with over half a dozen investments made across cyber security, AI, HR and health. She’ll give a rundown on why strong storytelling, a focus on solving a single problem well, and a thesis on defensibility are all essential in a pitch, and why making seed and series A investments often comes down to betting on the founding team.
Ali Partovi runs Neo, a mentorship community and VC fund that brings together tech veterans with diverse startup leaders. Partovi has backed the likes of Airbnb, Dropbox, Facebook and Uber, and also founded Code.org. Partovi also has experience as an entrepreneur, selling his first startup LinkExchange all the way back in 1998.
The first few employees determine a startup’s trajectory. Learn the dos and don’ts of hiring your early engineers.
Caryn Marooney is a partner at Coatue Management, sitting on the boards of ZenDesk and Elastic, with an advisory role at Airtable. Before Coatue, Caryn oversaw communications for Facebook, Instagram, WhatsApp and Oculus for eight years. Marooney is also a cofounder of the OutCast Agency, where she worked with companies across a wide spectrum of industries and sizes, including Salesforce, Amazon, Netflix and VMWare.
Startups often struggle to create a narrative that stands out. As a General Partner at Coatue, former head of Comms at Facebook, and co-founder of the OutCast Agency, Caryn Marooney has seen it all. Come learn the brand and messaging framework that can help your company stand out (while staying true to yourself.)
There will be about 50+ breakout sessions at the show, and attendees will have an opportunity to attend at least seven. The sessions will cover all the core topics confronting early-stage founders — up through Series A — as they build a company, from raising capital to building a team to growth. Each breakout session will be led by notables in the startup world on par with the folks we’ve announced today.
Don’t worry about missing a breakout session, because transcripts from each will be available to show attendees. And most of the folks leading the breakout sessions have agreed to hang at the show for at least half the day and participate in CrunchMatch, TechCrunch’s great app to connect founders and investors based on shared interests.
Here’s the fine print. Each of the 50+ breakout sessions is limited to around 100 attendees. We expect a lot more attendees, of course, so signups for each session are on a first-come, first-serve basis. Buy your ticket today and you can sign up for the breakouts we are announcing today. Pass holders will also receive 24-hour advance notice before we announce the next batch. (And yes, you can “drop” a breakout session in favor of a new one, in the event there is a schedule conflict.)
We’re absolutely thrilled for this event, and we hope you are, too. Buy a pass to Early Stage SF 2020 right here!
Interested in sponsoring Early Stage? Hit us up here.
Brooke Hammerling, the strategic communications veteran that brought us BrewPR, announced her new project today.
Dubbed The New New Thing, Hammerling’s new communications advisory wants to help startups bring more authenticity to brand messaging and comms through high-level partnerships with CEOs, founders, and executive leadership teams.
There are a few critical pieces to The New New Thing:
First, Hammerling will not focus on the usual six-month press release strategy that drives communications at most tech startups. The New New Thing isn’t focused as much on an individual product or funding round announcement as much as the high-level strategy of storytelling across the entire brand, including the company and the founder. In fact, the only pre-launch clients Hammerling will be taking on must be female-led and mission driven.
Second, she’ll be working directly with startup leadership teams to craft those narratives paying special attention to the stories in between the stories.
And finally, The New New Thing will have a huge focus on authenticity as a driver of relationships between its clients and the media.
One catalyst for the new project, according to Hammerling, was the evolution of the comms landscape as a whole. Not only is the media’s bullshit detector hyper sensitive, but so is the end-reader. It’s no longer enough to send out the same robotic press release announcing funding.
“I’m bored of seeing the same picture of two male founders announcing their funding for some fintech product that’s going to change the world,” said Hammerling. “There needs to be a fostering of the relationships between CEOs and the people telling their story. Being authentic is really hard for larger organizations, or really any organization. And now, in 2020, there is no option but to be.”
Hammerling explained that getting into the weeds with founders and tackling a storytelling challenge is what she loves doing most. She admits that managing a large team and dealing with the nitty gritty of comms (writing up press releases, pitching speakers for tech conferences, etc.) aren’t her strong suits.
As you might imagine, the launch of The New New Thing means that Hammerling has officially left Brew PR, the firm she founded and sold to Freuds for $15 million.
The New New Thing is part of a newly expanded collective of service providers called Plan A, led by Co-CEOs MT Carney and Andrew Essex. Plan A combines expert service providers from the fields of communications, branding, advertising, creative, and social, among others.
Hammerling will be focusing on early- and growth-stage startups in the tech industry, with a current client list that includes Lemonade, LiveNation, Framebridge, Splice, and Eko.
One example of how The New New Thing works is made clear with Splice. The company is represented by a PR firm that manages the day-to-day news cycle and announcement schedule, while Hammerling works directly with founder and CEO Steve Martocci on the overall narrative that runs through all of that.
When asked about the greatest challenge moving forward, Hammerling’s answer offered a taste of the authenticity and relatability she’s trying to bring out of her clients.
“Can I do this? Do I have the right instincts and guidance for my clients?” said Hammerling. “I think I do and I’ve been successful at that, but how do I maintain that and communicate that to others?”
Fintech startup Revolut lets you earn interests on your savings thanks to a new feature called savings vaults. That feature is currently only available to users living in the U.K. and paying taxes in the U.K.
The company has partnered with Flagstone for that feature. For now, the feature is limited to Revolut customers with a Metal subscription (£12.99 per month or £116 per year). But Revolut says that it will be available to Revolut Premium and Standard customers in the near future.
Savings vaults work pretty much like normal vaults. You can create sub-accounts in the Revolut app to put some money aside. And Revolut offers you multiple ways to save. You can round up all your card transactions to the nearest pound and save spare change in a vault.
You can also set up weekly or monthly transactions from your main account to a vault. And of course, you can transfer money manually whenever you want.
Metal customers in the U.K. can now turn normal vaults into savings vaults. The only difference is that you’re going to earn interests — Revolut pays those interests daily. You can take money from your savings vault whenever you want.
Revolut promises 1.35% AER interest rate up to a certain limit. If you put a huge sum of money in your savings vault, you’ll get a lower interest rate above the limit. Your money is protected by the FSCS up to a value of £85,000 for eligible customers.
The food industry may be the biggest industry in the world, but it’s also one of the least efficient. BCG says 1.6 billions tons of food, worth $1.2 trillion, is wasted in food every year, and those numbers are only expected to go up.
A number of players have stepped up to try to solve their own portion of the problem, and one such solution is Crisp. The company, which received $14 million in Series A funding last year led by FirstMark Capital, is today going live with its platform (which has been in beta).
Crisp aims to solve the global food waste problem via demand forecasts. Founder and CEO Are Traasdahl, a serial founder, believes that a lack of communication and data flow between the many players in the supply chain is a main cause for all this waste, a great deal of which happens long before the food reaches the consumer.
Right now, forecasting demand is nowhere close to a perfect science for many of these players. From food brands to distributors to grocery stores, the problem is usually solved by looking at a spreadsheet from last year’s sales to try to determine the signals that played into this or that SKU’s sales performance.
And then there was Crisp.
Integrated with almost any ERP software a company might have, Crisp ingests historical data from these food brands and combines that data with signals around other demand drivers, such as seasonality, holidays, price sensitivity and other pricing information, marketing campaigns, competitive landscape, weather that might affect the sale or shipment of certain produce or other ingredients.
Using these data points, and historical sales data, Crisp believes it can give a much more accurate picture of demand over the next day, week, month or year.
But Crisp isn’t just for food brands, such as Nounós Creamery, a Crisp customer that says its reduced scrapped inventory by 80% since switching to the platform. Crisp serves almost every player in the food supply chain, from retailers to distributors to brands to brokers.
And the more customers it gets, the better it is at predicting demand on a very specific level. For instance, the demand forecasting Crisp offers for a particular grocery store, based on external data, will obviously get much better once that grocery store is a customer on the platform.
Traasdahl was initially concerned that his customers would be reluctant to hand over this type of sensitive sales data, and also that players within the industry might be anxious to hand over such data to a platform that’s aggregating everyone’s data, including their competitors’. Turns out, the food industry has more of a “better together” mentality.
“Other industries are not as dependent on each other,” said Traasdahl. “If I am a creamery and need to buy blueberries for my yogurt, I may have five different vendors for those blueberries. And if they don’t get delivered on the right day, Costco will yell at me for being late with the yogurt. Everyone in the supply chain is somewhat dependent on each other.”
For that reason, it’s been easier than expected to attract clients to the platform. The prospect of a collaborative demand forecast platform, which is pulling signals from across the entire industry, is going to be more accurate than siloed demand forecasts produced by a single vendor or brand.
During the beta program, which launched in October, Crisp brought on more than 30 companies to the platform, including Gilbert’s Craft Sausages, SunFed Perfect Produce, Nounós Creamery, Hofseth, REMA and Superior Farms.
If you’ve ever entered a company’s office as a visitor or contractor, you probably know the routine: check in with a receptionist, figure out who invited you, print out a badge and get on your merry way. Brussels, Belgium- and New York-based Proxyclick aims to streamline this process, while also helping businesses keep their people and assets secure. As the company announced today, it has raised a $15 million Series B round led by Five Elms Capital, together with previous investor Join Capital.
In total, Proxyclick says it’s systems have now been used to register over 30 million visitors in 7,000 locations around the world. In the UK alone, over 1,000 locations use the company’s tools. Current customers include L’Oreal, Vodafone, Revolut, PepsiCo and Airbnb, as well as a number of other Fortune 500 firms.
Gregory Blondeau, founder and CEO of Proxyclick, stresses that the company believes that paper logbooks, which are still in use in many companies, are simply not an acceptable solution anymore, not in the least because that record is often permanent and visible to other visitors.
“We all agree it is not acceptable to have those paper logbooks at the entrance where everyone can see previous visitors,” he said. “It is also not normal for companies to store visitors’ digital data indefinitely. We already propose automatic data deletion in order to respect visitor privacy. In a few weeks, we’ll enable companies to delete sensitive data such as visitor photos sooner than other data. Security should not be an excuse to exploit or hold visitor data longer than required.”
What also makes Proxyclick stand out from similar solutions is that it integrates with a lot of existing systems for access control (including C-Cure and Lenel systems). With that, users can ensure that a visitor only has access to specific parts of a building, too.
In addition, though, it also supports existing meeting rooms, calendaring and parking systems and integrates with Wi-Fi credentialing tools so your visitors don’t have to keep asking for the password to get online.
Like similar systems, Proxyclick provides businesses with a tablet-based sign-in service that also allows them to get consent and NDA signatures right during the sign-in process. If necessary, the system can also compare the photos it takes to print out badges with those on a government-issued ID to ensure your visitors are who they say they are.
Blondeau noted that the whole industry is changing, too. “Visitor management is becoming mainstream, it is transitioning from a local, office-related subject handled by facility managers to a global, security and privacy driven priority handled by Chief Information Security Officers. Scope, decision drivers and key people involved are not the same as in the early days,” he said.
It’s no surprise then that the company plans to use the new funding to accelerate its roadmap. Specifically, it’s looking to integrate its solution with more third-party systems with a focus on physical security features and facial recognition, as well as additional new enterprise features.
Back in September, Betaworks put out a call for startups to participate in its latest “camp,” this one focused on audio.
Danika Laszuk, the head of Betaworks Camp, told me at the time that the startup studio was looking for companies that are trying to build “audio-first” experiences for smart speakers and wireless headphones, or pursuing other audio-related opportunities like synthetic audio or social audio.
Now Betaworks is unveiling the six startups that it has selected to participate in the program, covering everything from game assistants to AI music production. Each startup receives a pre-seed investment from Betaworks, and will be working out of the firm’s New York City offices for the next three months.
Here are the companies:
Back in August, we flagged a filing for you that we found interesting, one for a now 2.5-year-old, 40-person Redwood City, Calif.,-based startup called Bear Robotics that’s been developing robots to deliver food to restaurant customers. The filing listed a $35.8 million target; Bear Robotics founder and CEO John Ha now tells us the final close, being announced today, was $32 million in Series A funding.
The round was led by SoftBank Group, whose other recent robotics bets include the currently beleaguered food truck company Zume and, as we reported yesterday, Berkshire Grey, a seven-year-old, Lexington, Mass.-based company that makes pick, pack and sorting robots for fulfillment centers and that just raised a whopping $263 million in Series B funding led by SoftBank.
Because we know you’re interested in much more than Bear Robotics’ funding picture, we asked Ha — a former Intel research scientist turned technical lead at Google who in recent years opened and closed his own restaurant — to share more about the company and its robot servers.
TC: You were an engineer at Google. Why then start your own restaurant?
JH: It’s not like I had a dream of having a restaurant; it was more of an investment. It sounded fun, but it didn’t turn out to be fun. What I was really shocked by was how much hard work is involved and how low [employees’] income is. I felt [as I was forced to close it] that this was going to be my life’s work — to transform the restaurant industry with the skills I have. I wanted to remove the hard work and the repetitive tasks so that humans can focus on the truly human side, the hospitality. At restaurants, you’re selling food and service, but most of your time is spent dealing with hiring people and people not showing up, and I suspect our product will change [the equation] so restaurants can focus more on food and service.
TC: How did you come up with the first idea or iteration of the robot you’ve created, that you’re calling Penny?
JH: First, me and my restaurant staff constantly discussed, ‘If we have this robot, what would it look like and what capacity and features would it need?’ I knew it couldn’t be too big; robots have to be able to move well in narrow spaces. We also focused on the right capacity. And we didn’t want to make a robotic restaurant. I wanted to build a robot that no one really cares about; it’s just in the background, sort of like R2-D2 to Luke Skywalker. It’s a sidekick — a bland robot with a weak personality to get things done for your master.
TC Let’s talk parts. How are these things built?
JH: It’s self-driving tech that’s been adopted for indoor space, so it can safely navigate from Point A to Point B. A server puts the food on Penny, and it finds a way to get to the table. It has a two-wheel differential drive, plus casters. It’s pretty safe. A lot of similar-looking robots have blind spots, but ours doesn’t. It can detect baby hands on the floor — even something as thin as a wallet that’s fallen from someone’s table.
We’re not using robot arms because it’s very difficult to make it 100% safe when you have arms in a crowded space. The material — it’s going to be plastic — is safe and easy to clean and able to work with the sanitizers and detergents used in restaurants. We’ve also had to make sure the wheels won’t accumulate food waste, because that would cause issues with the health department.
TC: So this isn’t out in the world yet.
JH: We haven’t entered the mass-manufacturing phase yet.
TC: Where will these be built, and how will you charge for them?
JH: They’ll be made somewhere in Asia — maybe China or some other country. And we haven’t figured out pricing yet but restaurants will be leasing these, not buying them, and there will be a monthly subscription fee that they are paying for a white-glove service, so they don’t have to worry about maintenance or support.
TC: How customizable are these Penny robots going to be? Are there different tiers of service?
JH: Penny can be configured into several modes. The default is [for it to hold] three trays, so it can carry food to a table or a server can use it for busing help.
TC: Will it address the customers?
JH: Penny can speak and play sound, but it’s not conversational yet. It can say, ‘Please take your food,’ or play music while it’s moving. That’s where customers may want to personalize the robot for their own purposes.
TC: Ultimately, the idea is for this to be sold where — just restaurants?
JH: Wherever food is served, so it’s being tested right now in some restaurants, casinos, some homes. [I’m sure we’ll add] nursing homes, too.
Farming is one of the oldest professions, but today those amber waves of grain (and soy) are a test bed for sophisticated robotic solutions to problems farmers have had for millennia. Learn about the cutting edge (sometimes literally) of agricultural robots at TC Sessions: Robotics+AI on March 3 with the founders of Traptic, Pyka and FarmWise.
Traptic, and its co-founder and CEO Lewis Anderson, you may remember from Disrupt SF 2019, where it was a finalist in the Startup Battlefield. The company has developed a robotic berry picker that identifies ripe strawberries and plucks them off the plants with a gentle grip. It could be the beginning of a new automated era for the fruit industry, which is decades behind grains and other crops when it comes to machine-based harvesting.
FarmWise has a job that’s equally delicate yet involves rough treatment of the plants — weeding. Its towering machine trundles along rows of crops, using computer vision to locate and remove invasive plants, working 24/7, 365 days a year. CEO Sebastian Boyer will speak to the difficulty of this task and how he plans to evolve the machines to become “doctors” for crops, monitoring health and spontaneously removing pests like aphids.
Pyka’s robot is considerably less earthbound than those: an autonomous, all-electric crop-spraying aircraft — with wings! This is a much different challenge from the more stable farming and spraying drones like those of DroneSeed and SkyX, but the choice gives the craft more power and range, hugely important for today’s vast fields. Co-founder Michael Norcia can speak to that scale and his company’s methods of meeting it.
These three companies and founders are at the very frontier of what’s possible at the intersection of agriculture and technology, so expect a fruitful conversation.
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