In a sign of the growing importance and value of digital healthcare in the world of medicine, two of the industry’s publicly traded companies have agreed to a whopping $18.5 billion merger.
The union of Teladoc Health, a provider of virtual care services, and Livongo, which has made a name for itself by integrating hardware and software to monitor and manage chronic conditions like diabetes, will create a giant in the emerging field of telemedicine and virtual care.
“By expanding the reach of Livongo’s pioneering Applied Health Signals platform and building on Teladoc Health’s end-to-end virtual care platform, we’ll empower more people to live better and healthier lives,” said Glen Tullman, Livongo Founder and Executive Chairman. “This transaction recognizes Livongo’s significant progress and will enable Livongo shareholders to benefit from long-term upside as the combined company is positioned to serve an even larger addressable market with a truly unmatched offering.”
Under the terms of the agreement, each share of Livongo will be exchanged for 0.5920 shares of Teladoc health plus a cash payment of $11.33 for each share. The deal, based on Teladoc’s closing price on August 4, 2020, is roughly $18.5 billion. It’s an eye-popping figure for a company that was, at one point, trading below $16 per-share.
But the new reality of healthcare delivery in the era of COVID-19 rapidly accelerated the adoption of digital and remote care services like those Livongo was selling to its customers — and investor came calling as a result.
The combined company is expected to have pro forma revenue of $1.3 billion representing 85 percent year on year growth, on a pro forma basis. For 2020, the combined company expects adjusted EBITDA to reach $120 million.
“This merger firmly establishes Teladoc Health at the forefront of the next-generation of healthcare,” said Jason Gorevic, the chief executive officer of Teladoc Health, in a statement. “Livongo is a world-class innovator we deeply admire and has demonstrated success improving the lives of people living with chronic conditions. Together, we will further transform the healthcare experience from preventive care to the most complex cases, bringing ‘whole person’ health to consumers and greater value to our clients and shareholders as a result.”
The companies emphasized their combined ability to engage with patients and monitor and manage their conditions using technology. Teladoc Health’s flywheel approach to continued member engagement combined with Livongo’s proven track record of using data science to build consumer trust will accelerate the combined company’s development of longitudinal consumer and provider relationships, the companies said in a statement.
Teladoc currently counts 70 million customers in the United States with an access to Medicare and Medicaid patients that Livongo’s services could reach. The combined company also pitched the operational efficiencies that could be created through the merger. Teladoc estimated that there would be “revenue synergies” of $100 million two years from the close of the deal, reaching $500 million on a run rate basis by 2025, according to a statement.
Gorevic will run the combined company and David Snow will serve as the chair of the new board — which will be comprised of eight current Teladoc board members and five members of the Livongo board.
The company expects the deal to close by the end of the fourth quarter, subject to regulatory approvals. Lazard advised Teladoc on the transaction while Morgan Stanley served as the financial advisor to Livongo.
Amazon has said the number of demands for user data made by U.S. federal and local law enforcement have increased during the first half of 2020 than during the same period a year earlier.
The disclosure came in the company’s latest transparency report, published Thursday.
The figures show that Amazon received 23% more subpoenas and search warrants, and a 29% increase in court orders compared to the first half of 2019. That includes data collected from its Amazon Echo devices and its Kindle and Fire tablets.
Breaking those figures down, Amazon said it received:
The number of requests to the company’s cloud services, Amazon Web Services, also went up compared to a year earlier.
But it’s not clear what caused the rise in U.S. government demands for user data. A spokesperson for Amazon did respond to a request for comment.
But the company saw the number of overseas requests drop by about one-third compared to the same period a year earlier. Amazon rejected 92% of the 177 overseas requests it received, turning over partial user data in 10 cases and all requested data in four cases.
Amazon also said it received between 0 and 249 national security requests, flat from previous reports. Justice Department rules on disclosing classified requests only allow companies to respond in numerical ranges.
Amazon was one of the last major tech companies to issue a transparency report, despite mounting pressure from privacy advocates. But its report remains far lighter on details compared to its Silicon Valley rivals.
The company’s Ring smart camera division, despite facing criticism for its poor security practices its close relationships with law enforcement, has yet to release any data related to police requests for user data.
“The doctor’s office is dead.”
That’s the way Nick Desai, the co-founder and chief executive of the Los Angeles-based startup Heal describes the future of traditional healthcare delivery.
While Desai’s bluster may be wishful thinking, the doctor’s office is certainly changing, and that’s thanks in part to companies like Heal, which offer in-home and telemedical consultations — and health insurance providers like Humana that are backing them.
The two companies have announced a new partnership that will see Humana pushing Heal’s in-home and virtual care delivery services to the patients it covers and committing $100 million to spur the Los Angeles-based startup’s growth.
“Humana has a more strategic view of home-based care,” said Desai. “We want all payers to be this strategic. Most insurance partners offer Heal now but we want them to view it more strategically.”
For Desai, the home is the best place to get care because doctors can see the environment that may influence (and in some cases complicate or worsen) a patient’s condition. Heal, Desai says, also works with the digital technologies to provide more remote and persistent patient monitoring, so that doctors can have a better sense of a patient’s health over time, rather than at an acute moment of care.
“You want to talk to the doctor and get continuity of care,” said Desai. “We think we are… an accelerant for the adoption of those services.”
Things like iPhone-based EKG machines, remote diagnostics to determine diabetic retinopathy, digital hubs to provide remote monitoring of body mass and movement are all hardware offerings within Heal’s panoply of care and diagnostic solutions. “We want to be able to gather more and more of those diagnostics remotely,” Desai said. “Anything that makes care more accurate, more data driven, more timely we want to use and ask our patients to utilize so that they can get better care, more quickly and more affordably.”
The new financing from Humana will go to support Heal’s geographic expansion, product development, and sales and marketing, Desai said. Already, the company has expanded into new treatment areas, including teletherapy for mental health.
Discussion between Heal and the Louisville-based Humana began back in December and the two businesses only inked the final terms of their deal last week.
Heal telemedicine, telepsychology (CA only), and digital monitoring services are currently available in New York, New Jersey, Washington, California, Georgia, Virginia, Maryland, and Washington D.C. To date, the company has linked patients with over 200,000 home visits from doctors since its launch in 2015.
Under the terms of the agreement with Humana, will expand to geographies in Chicago, Charlotte and Houston as part of Humana’s “Bold Goal” program focusing on addressing and creating healthcare services that address social determinants and social needs for its population of insured patients.
“The partnership with Heal is part of Humana’s efforts to build a broader set of offerings across the spectrum of home based care, with high quality, value-based primary care being a key foundational element,” said Susan Diamond, Humana’s Segment President, Home Business, who is joining Heal’s Board of Directors as part of the partnership and investment. “We continue to see high levels of customer satisfaction and improved health outcomes when care is delivered in the home. Our goal is to make the healthcare experience easier, more personalized and caring for the people we serve—and is the hallmark of how Humana delivers human care.”
For Desai, the deal is also an indicator of not just his company’s growth, but the growth of the entire Los Angeles technology ecosystem.
“Heal’s funding just proves that LA is as much an epicenter of venture backed ecosystem as any in the country including Silicon Valley,” he said.
XPRIZE is turning its tried and tested model of offering cash prizes to spur innovation in critical areas to the challenge of COVID-19 testing. the nonprofit has created a $5 million prize pool for a Rapid COVID Testing competition, in partnership with an organization called OpenCovidScreen formed by scientists, researchers and industry leaders to drive open scientific collaboration on the topic.
The competition calls for participants to develop low-cost, rapid result testing solutions that can supplement those already in existence in order to massively scale testing capabilities and pave the way for safe reopening strategies. It’s open to potential solutions across a number of categories, including at-home tests, those conducted at point-of-care, distributed lab testing, and finally high-throughput lab solutions.
Judging for the ultimate prize awards will focus on their innovation, their performance, how quickly they can delver results (with the max allowable turnaround time capped at 12 hours), how scalable they are and how easy to use and cost-effective they can be (with a cost ceiling of $15 per test). The XPRIZE organization is also encouraging people to try a range of different technologies in their proposed solutions in order to diversify and ensure sustainability of the supply chain.
In order to take part, teams must joint the competition by August 31, 2020. The competition aims to announce grand prize winners by the end of January, and the plan is to award $1 million each to five teams.
Following the competition, participants can also benefit from a $50 million fund established by the ‘COVID Apollo Project’ to develop, deploy and scale their solution to actual production and distribution.
In three years Zachariah Reitano’s startup, Ro, has managed to hit a reported $1.5 billion valuation for its transformation from a company focused on treating erectile disfunction to a telemedicine service for a range of elective and urgent care-focused treatments.
Through Rory for women’s health, Roman for men’s health, and Zero for smoking cessation, Reitano’s company now treats 20 conditions including sexual health, weight loss, dermatology, allergies and more, according to a statement from the company.
Image Credit: Zero
Ro also has a new pharmacy business, Ro Pharmacy, which is an online cash pay pharmacy offering over 500 generic medications for just $5 per month per drug. And the company is getting into the weight loss business through a partnership with the private equity-backed health care company, Gelesis.
Ro’s also becoming a gateway into patient acquisition for primary care providers through Ribbon Health, and a test-case for the use of Pfizer’s Greenstone service, which provides certification that a generic drug is validated by one of the major pharmaceuticals.
The company’s $1.5 billion valuation is courtesy of a new $200 million investment from existing investors led by General Catalyst and including FirstMark Capital, Torch, SignalFire, TQ Ventures, Initialized Capital, 3L, and BoxGroup. New first time investor The Chernin Group also participated. In all, Ro has raised $376 million since it launched in 2017.
“This new investment will further our mission to become every patient’s first call. We’ll continue to invest in our vertically-integrated healthcare ecosystem, from our Collaborative Care Center to our national pharmacy operating system. This is just the beginning of Ro’s patient-centered healthcare platform.”
It’s all part of the company’s mission to provide a point of entry into the healthcare system independent of insurance qualifications.
“Telehealth companies like Ro are using technology to address long-standing healthcare disparities that have been exacerbated by Covid-19,” said Dr. Joycelyn Elders, MD, Ro Medical Advisor and Former US Surgeon General. “By empowering providers to leverage their skills as efficiently and effectively as possible, Ro delivers affordable, high-quality care regardless of a patient’s location, insurance status, or physical access to physicians and pharmacies.”
Ro’s new financing is one of several forays by tech investors into reshaping the healthcare system at a time when patient care has been severely disrupted by attempts to mitigate the spread of COVID-19.
Digital medicine is assuming a central position in the healthcare world with most consultations now occurring online. Reimbursement schemes for telemedicine have changed dramatically and investors see an opportunity to capitalize on these changes by aggressively backing the expansion plans of companies looking to bring digital healthcare directly to consumers.
That’s one of the reasons why Ro’s major competitor, Hims, is reported to be seeking access to public markets through its sale to a Special Purpose Acquisition Company for roughly $1 billion, according to Reuters.
Alex Alvarado, Siddarth Cidambi, and Luke Mercado, the three co-founders of Daybreak Health, either worked with startups in the health care industry or consulted on the healthcare industry for a few years before deciding to launch their new startup.
For Alvarado, whose brother has been struggling with depression since he was twelve years old, the issue is personal, the founder said in an interview. It was only two years ago that Alvarado received a call telling him that his brother had attempted to take his own life after his decades-long struggle.
It was then that Alvarado began to confront just how broken current treatment methodologies were. His family had tried to find consistent care for Alvarado’s younger brother, but therapists were expensive, remote, had waiting lists that were weeks-long, and had difficulty related to teens (especially teens who weren’t white).
Alvarado’s brother isn’t alone. One in five teens in the US have or will have a mental health issue, Alvarado said, and the nation’s ineffectual response to the COVID-19 epidemic is only exacerbating the problem. Judging by the statistics, there are 7 million teens in the US right now with a mental health condition and rates of depression and anxiety are going up.
The team of ten clinicians that Daybreak Health works with have a deep experience with evidence-based care and Alvarado expects that most of the patients that they consult will be undergoing some form of behavioral therapy guided by those clinicians.
For teens who are experiencing less acute mental health issues, there’s a team of what the company calls “trained listeners” to provide support.
Alvarado and Cidambi both worked at the consulting firm Oliver Wyman and Mercado and Alvarado knew each other from Jiff, a healthcare startup focused on providing wellness benefits to employees at companies, which was eventually bought by Castlight Health.
To ensure their mental health bona fides, the company brought in Dr. Neha Chaudary from Stanford’s Brainstorm Lab, which focuses on innovation in mental health. “They’re actually the ones designing our clinical program from the ground up,” says Alvarado.
Image Credit: Daybreak Health
The company is currently working with 20 Bay Area schools and pediatric groups in the Bay area and is focused on treating teens aged thirteen to nineteen, says Alvarado.
Currently, both schools and pediatric groups are referring patients to the company, and the cost of care is covered either through insurance or through an $89 per-week fee.
“This is a full-stack therapy program,” says Alvarado. “It’s an improvement, in our view [on traditional therapy], because not only are you getting that invidividual one-on-one therapy, but you’re also getting curriculums around certain points in time.”
For the teens, it’s not only about specific interventions to prevent certain behaviors, Cidambi says. It’s also to build up coping mechanisms so teens can better respond to mental health pressures as adults.
Alvarado stresses that the program isn’t for any teen that’s feeling a bit stressed or for parents who’re just worried about their child’s performance. There’s an hour-long intake consultation conducted with both the teen and the parent before a teen can be admitted to the program.
And the company has already turned away some potential customers because they just didn’t need the treatment. “Our goal is not to just bring anybody into treatment.”
Alvarado would not say how many students are currently being treated from its Bay Area partner schools, and says that the schools are a mix of both public and private institutions in the Bay Area.
“Our main touchpoint at the school will be the school counselor or the wellness coordinator,” says Cidambi. Daybreak Health doesn’t pay for referrals but does reach out to school counselors to market its services.
The company is far from the only service out there trying to provide online counseling for teens, TeenCounseling is one service that boasts 5,000 therapists and offers its services from $80 to $100 per week.
“The beauty of what we’re doing is the marriage of the clinical program with the technology,” says Alvarado. “We always want to have the therapist involved. And we are developing a mobile app… that is to communicate… and enable patients to do some exercises on their own, but we never believe that it will be a standalone app.”
There are other persistent, grave health crises brewing besides the ongoing COVID-19 pandemic: Antibiotic resistance is one, and the troubling trend is that it’s on the rise, leading to an increase in so-called ‘superbugs’ that are difficult to treat. IBM Research, working in partnership with Singapore’s Institute of Bioengineering and Nanotechnology, has developed a synthetic macromolecule polymer that can potentially be used to significantly increase the effectiveness of existing antibiotics, rendering them able to fight off emerging superbugs.
In a new paper published in academic journal Advanced Science, the IBM researchers detail their work in creating a polymer that can be combined with course of antibiotics that are used to treat non-resistant strains of infections, in does equal or even lower to those that are found to be effective in treating the varieties of the infections that lack the ability to overcome antibiotics.
The macromolecule works by essentially hitching itself to the enzymes that bacteria modify when they are treated using antibiotics, but not completely eliminated. That’s a big reason why you’re always told to take the entire course of an antibiotic when it’s prescribed: If it isn’t completely wiped out, it can rebound and develop resistance to the treatment used when it comes back.
The IBM polymer basically shorts out the protective measures developed by the bacteria when to counter the effects of the antibiotic, returning (or potentially even slightly improving) their efficacy.
This is still relatively early research that’s been done in the highly controlled environment of the lab, and would require a lot more development and testing, including proper clinical trials involving human patients before it actually becomes anything to be used in the real world. But these lab-based results provide a very promising basis upon which to build that work, having shown demonstrated efficacy with real multidrug-resistant bacterial infections.
From a partnership with the Russian company 3D Bioprinting Solutions to make chicken meat replacements using plant material and lab cultured chicken cells to an expansion of its Beyond Fried Chicken pilots to Southern California, KFC is aggressively pushing forward with its experiments around the future of food.
In Russia, that means providing 3D Bioprinting with breading and spices to see if the company’s chicken replacements can match the KFC taste, according to a statement from the company. As the company said, there are no other methods available on the market that can allow for the creation of complex products from animal cells.
“3D bioprinting technologies, initially widely recognized in medicine, are nowadays gaining popularity in producing foods such as meat,” said Yusef Khesuani, co-founder and Managing Partner of 3D Bioprinting Solutions, in a statement. “In the future, the rapid development of such technologies will allow us to make 3D-printed meat products more accessible and we are hoping that the technology created as a result of our cooperation with KFC will help accelerate the launch of cell-based meat products on the market.”
Image: Beyond Meat
Closer to its home base in the US, KFC is working with the publicly traded plant-based meat substitute developer Beyond Meat on an expansion of their recent trials for KFC’s Beyond Fried Chicken.
Continuing its wildly successful limited trials in Atlanta, Nashville, and Charlotte, KFC is now setting its sights on the bigger markets in Southern California, near Beyond Meat’s headquarters in Los Angeles.
Beginning on July 20, KFC will be selling Beyond Fried Chicken at 50 stores the Los Angeles, Orange County and San Diego areas, while supplies last, the company said.
Unlike the 3D bioprinting process used by its Russian partner, Beyond Meat uses plant-based products exclusively to make its faux chicken meat.
Beyond Fried Chicken first appeared on the market last year in Atlanta and was made available in additional markets in the South earlier this year. The menu item — first available in a one-day consumer test in Atlanta — sold out in less than five hours, the company said.
“I’ve said it before: despite many imitations, the flavor of Kentucky Fried Chicken is one that has never been replicated, until Beyond Fried Chicken,” said Andrea Zahumensky, chief marketing officer, KFC U.S. “We know the east coast loved it, so we thought we’d give those on the west coast a chance to tell us what they think in an exclusive sneak peek.
Beyond Fried Chicken nuggets will be available as a six or 12-piece à la carte or as part of a combo, complete with a side and medium drink starting at $6.99, plus tax.
Meanwhile, KFC’s Russian project aims to create the world’s first lab-made chicken nuggets, and plans to release them this fall in Moscow.
Popularizing lab-grown meat could have a significant impact on climate change according to reports. The company cited statistics indicating that growing meat from cells could half the energy consumption involved in meat production and reduce greenhouse gas emissions while dramatically cutting land use.
“Crafted meat products are the next step in the development of our ‘restaurant of the future’ concept,” said Raisa Polyakova, General Manager of KFC Russia & CIS, in a statement. “Our experiment in testing 3D bioprinting technology to create chicken products can also help address several looming global problems. We are glad to contribute to its development and are working to make it available to thousands of people in Russia and, if possible, around the world.”
The coronavirus continues to hit people hard mentally, and this has meant a boom for mental death and meditation apps. According to a recent report from app store intelligence firm Sensor Tower, the world’s 10 largest English-language mental wellness apps in April saw a combined 2 million more downloads during the month of April 2020 compared with January, reaching close to 10 million total downloads for the month. The charts were dominated by market leaders such as Calm, Headspace and others such as “Relax: Master Your Destiny”.
However, a slightly lesser know app called Meditopia featured, and that’s because it’s become a big leader non-English speaking markets.
Today it’s announced a Series A investment of $15M co-led by Creandum, and Highland Europe . Carl Fritjofsson of Creandum and Fergal Mullen of Highland Europe will join Meditopia’s Board of Directors. Total funding prior to this round was $3.2m. This new round takes the total to $18.2m.
Based between Istanbul and Berlin, Meditopia has majored on localization for 75 global markets, in 10 languages, with a focus on long-term mental wellbeing programs. Since launching in 2017 Meditopia has grown to 14M users across 75 countries.
Until recently, most meditation and mental health apps were built to suit the needs of English-speaking, Western culture, especially in the way these apps dealt with topics such as gender.
The startup was founded by Fatih Celebi, Berk Yilmaz and Ali Murat Ceylan.
In a statement, Murat said: “Mental wellness is something everyone should be able to achieve, regardless of their country of origin, native language, socio-economic status, ethnicity, or religion. We first focused our efforts on our home country Turkey before expanding worldwide so whether you are Latino, Japanese, Russian, North American, or Arab, you can find support and coaching in our global community.”
Carl Fritjofsson, Partner at Creandum commented: “We’ve followed Meditopia for the past two years and have been incredibly impressed by how they’ve been able to capture this opportunity across the world, all while being one of the most capital-efficient run companies around.”
Fergal Mullen, Founding Partner at Highland Europe said: “For too long, the technology available was created for English-speaking groups alone. Meditopia provides the alternative; a solution that helps its members get to the heart of what they need in a way that suits them. We’re thrilled to be a part of getting this vital service to those people.”
A heavyweight partnership between industry and academic sciences is throwing their considerable weight into an important task: Creating a new low-cost, rapid diagnostic test for COVID-19. Chemical industry leader 3M has partnered with MIT to create a diagnostic tool for COVID-19 that’s easy-to-use, and that can be manufactured cheaply and in large volume for mass distribution and use.
The test is currently the research phase, with a team led by MIT’s Professor Hadley Sikes of the school’s Department of Chemical Engineering. Sikes’ laboratory has a specific focus on creating and developing tech to enhance the performance of protein tests that are meant to provide rapid, accurate results.
3M is contributing its biomaterials and bioprocessing expertise, along with its experience in creating products designed to be manufactured at scale. The end goal is to create a test that detects viral antigens, a type of test first cleared for use in COVID-19 detection at the beginning of May by the FDA. These tests provide results much faster than the molecular PCR-based test – but do have a higher change of fall negatives. Still, their ability to be administered at point-of-care, and return results within just minutes, could help considerably in ramping up testing efforts, especially in cases where individuals aren’t necessarily presenting symptoms but are in situations where they could pose a risk to others if carrying the virus while asymptomatic.
The new 3M and MIT projects is part of the RADx Tech program created by the National Institute of Health (NIH) specifically to fund the development of tests that can expand U.S. testing deployment. An initial $500,000 of funding was provided to MIT and 3M from the program, and it can potentially receive further funding after achieving other development milestones.
Orbital Witness, a U.K.-based legaltech startup developing “AI-powered” software to transform the £4 billion U.K. property due diligence market, has raised £3.3 million in seed funding.
The round is led by LocalGlobe and Outward VC, with participation from previous investors, including Seedcamp and JLL Spark. It brings Orbital Witness’s total funding to £4.5 million.
Launched with its first customer in September 2018 and now used by numerous large law firms, including four of the five so-called “Magic Circle” firms, Orbital Witness’ long-term vision is to build a “universal risk rating” for real estate. “Think of a credit risk check for land and property,” Orbital Witness co-founder and COO Will Pearce tells me.
To do this, the startup is employing machine learning technology that it hopes can mirror the process a lawyer goes through when gathering and checking property information. The idea is to use AI to “predetermine” issues that constitute a potential risk.
“Our technology is adept at trawling through and extracting key issues from the wide range of sources that a property lawyer considers, including HM Land Registry and local authorities,” explains Pearce. “For example, a user is alerted to third party rights, charges and restrictions that might block a sale. In our current state of product development, this allows Orbital Witness to act as an ‘early warning system’ for property lawyers”.
Zooming out further, Pearce says real estate is the world’s largest asset class, but that the process of recording and reporting on property rights has not materially changed in 150 years. This sees real estate lawyers having to manually collect and review information from an array of disparate sources, which can often take weeks to arrive before they can even start. Meanwhile, the various real estate stakeholders — from banks making lending decisions, large commercial real estate PE funds, to residential homebuyers — can’t sign off transactions until the lawyers have completed their due diligence.
“Anyone who has ever bought a home will appreciate the frustrations of dealing with this legal due diligence process, and in commercial real estate, where Orbital Witness is initially focussed, many of these problems are amplified,” says Pearce.
The longer term plan is to ingest a broader range of data, so that Orbital Witness can eventually become trusted to provide a universal risk rating for real estate. This will see its risk modelling solutions wired to also include geographic information (e.g. flood risk), privately held information that can be uploaded to the platform (e.g. rights of lights reports), and also non-legal information (e.g. financial data from public records and ratings agencies).
Adds the Orbital Witness co-founder: “Very importantly, risk in real estate is dependent on the context of a transaction. For a real estate investor purchasing a block of flats, they are interested in understanding the security of rental income derived from the leaseholds. However, a property developer transacting on the same building, may be more interested in any hidden covenants that could prevent the ability to build or redevelop the site”.
Nigeria’s e-commerce startup TradeDepot, which connects international brands to small businesses in Africa, has raised $10 million in a new round of funding to expand its business into financial services and credit offerings for retailers.
First launched in 2016, TradeDepot has built up a network of 40,000 small businesses in Nigeria and connects them to local distributors of global consumer brands like Nestlé, Unilever, GB Foods and Danone, according to a statement.
The initial business model managed to attract a $3 million investment led by Partech back in 2018. And now, as the firm invests from its largest African fund, Partech returned to co-lead TradeDepot’s latest round with the International Finance Corp., Women Entrepreneurs Finance Initiative and MSA Capital.
TradeDepot’s business depends on making a range of household supplies like milk, soap, and detergent more accessible and affordable for the street-side vendors and small shops that provide goods and services for hundreds of communities in cities like Lagos — where the company is headquartered.
Using the company’s mobile apps on Android or Whatsapp, USSD short code messaging or a toll-free phone number, retailers can place orders and have goods and services delivered through TradeDepot’s fleet of vans and tricycles. They can make payments, order stock, and manage inventory online or through the app as well.
For consumer brands, they have a central hub through which to distribute directly to vendors on the continent, along with data that can help them manage their relationship with these small vendors.
Image Credit: TradeDepot
“Africa’s offline retail market is estimated at $1 trillion, and this new investment allows us to capture an even greater segment of that market,” said Onyekachi Izukanne, in a statement. “We will continue to use data to drive efficiencies and provide an easier stock acquisition service for our [over] 40,000 retailers, driving down costs for them by negotiating even better deals with our global manufacturing partners, whilst simultaneously providing a better, faster route to market for our suppliers.”
The company said that a new store comes online to use its services every three minutes and that the company receives an order from retailers every four seconds, on average.
Now, with the new capital, TradeDepot will expand into a suite of financial services and lending products for its retailers. Many of the company’s customers lack a credit rating, but TradeDepot has alternative ways to score credit based on the data it has from its existing trading relationships.
“The founders’ vision to build a digital platform that improves the unit economics of serving the mass market is one we feel privileged to support,” said Wale Ayeni, the head of Africa Venture Capital investment at the IFC.
That support disproportionately goes to helping women entrepreneurs, according to the company. Women account for over 75% of the retailers on the company’s platform. Now, with the help of its new investor We-Fi, TradeDepot will look to offer mentorship opportunities and link these business owners to global markets.
“Women play a pivotal role in driving economies across Africa, but lack of access to capital, limited market linkages, cultural norms and other challenges often prevent them from achieving the success they want,” saiid Hanh Nam Nguyen, who represents the We-Fi initiative with the IFC. “We-Fi financing will incentivize TradeDepot to build stronger women-led small and medium enterprises (SME) retailer and distributor networks, which will support them to become drivers of economic growth in their communities.”
Everywhere you go, you are being followed. Not by some creep in a raincoat, but by the advertisers wanting to sell you things.
The more advertisers know about you — where you go, which shops you visit, and what purchases you make — the more they can profile you, understand your tastes, your hobbies and interests, and use that information to target you with ads. You can thank the phone in your pocket — the apps on it, to be more accurate — that invisibly spits out gobs of data about you as you go about your day.
Your location, chief among the data, is by far the most revealing.
Apps, just like websites, are filled with trackers that send your real-time location to data brokers. In return, these data brokers sell on that data to advertisers, while the app maker gets a cut of the money. If you let your weather app know your location to serve you the forecast, you’re also giving your location to data brokers.
By collecting your location data, these data brokers have access to intensely personal aspects of your life and can easily build a map of everywhere you go. This data isn’t just for advertising. Immigration authorities have bought access to users’ location data to help catch the undocumented. In one case, a marketing firm used location data harvested from phones to predict the race, age, and gender of Black Lives Matter protesters. It’s an enormous industry, said to be worth at least $200 billion.
It’s only been in recent years that it was possible to learn what these data brokers know about us. But the law is slowly catching up. Anyone in Europe can request access to obtain or delete their data under the GDPR rules. California’s new consumer privacy law grants California residents access to their data.
But because so many data brokers collect and resell that data, the data marketplace is a fragmented mess, making it impossible to know which companies have your data. That can make requesting it a nightmare.
Jordan Wright, a senior security architect at Duo Security, requested his data from some of the biggest data brokers in the industry, citing California’s new consumer privacy law. Not all went to plan. As an out-of-state resident, only one of the 14 data brokers approved his request and sent him his data.
What came back was a year’s worth of location data.
Wright works in cybersecurity and knows better than most how much data spills out of his phone. But he takes precautions, and is careful about the apps he puts on his phone. Yet the data he got back knew where he lives, where he works, and where he took his family on holiday before the pandemic hit.
“It’s frustrating not fully knowing what data has been collected or shared and by whom,” he wrote in a blog post. “The reality is that dozens of companies are monitoring the location of hundreds of millions of unsuspecting people every single day.”
Avoiding this invasive tracking is nearly impossible. Just like with web ad tracking, you have little choice but to accept the app’s terms. Allow the tracking, or don’t use the app.
But the winds are changing and there is an increasing appetite to rein in the data brokers and advertising giants by kneecapping their data collection efforts. As privacy became a more prominent selling point for phone consumers, the two largest smartphone makers, Apple and Google, in recent years began to curb the growing power of data brokers.
Both iPhones and Android devices now let you opt-out of ad tracking, a move that doesn’t reduce the ads that appear but prevents advertisers from tracking you across the web or between apps.
Apple threw down the gauntlet last month when it said its next software update, iOS 14, would let users opt-out of app tracking altogether, serving a severe blow to data brokers and advertisers by reducing the amount of data that these ad giants collect on millions without their explicit and direct consent. That prompted an angry letter from the Interactive Advertising Bureau, an industry trade group that represents online advertisers, expressed its “strong concerns” and effectively asked it to back down from the plans.
Google also plans to roll out new app controls for location data in its next Android release.
It’s not the only effort taking on data brokers but it’s been the most effective — so far. Lawmakers are scrambling to find bipartisan support for a proposed federal data protection agency before the end of the year, when Congress resets and enters a legislative session.
Shy of an unlikely fix by Washington, it’s up to the tech giants to send a message.
Elon Musk said on Twitter this week that Neuralink, the company he founded in 2016 to develop computer-brain interfaces for the explicit purpose of helping humans keep pace with advanced artificial intelligence, will provide an update on its progress on August 28. The last major update from Neuralink came roughly a year ago, when it shared that it will be using a surgical robot to implant gossamer-thin wires into a person’s brain, connected to an external computer processing unit, and that ultimately it hopes to make the connection between the two wireless for maximum freedom and flexibility.
Neuralink revealed in July 2019 that it had already performed successful tests of its technology on mice and even apes, and that it would be pursuing testing on its first human subjects starting as early as the following year – which is this year, 2020, if you’re keeping track.
C-founded by Musk and led by CEO Jared Birchall, Neuralink is headquartered in San Francisco and has been conducting research in partnership with UC Davis. The company’s goal initially is to use its technology to help mitigate the effects of neurological disorders in patients with severe impacts to mobility and other daily functioning, but ultimately the company also hopes to use its technology to essentially ‘upgrade’ humans to be able to interact with computing devices at the speed of thought.
Musk has consistently pointed out how ‘lossy’ the process of translating thought to input via conventional means including keyboard and mouse is, and believes that a tighter, more high-fidelity bond between people and computers can help decrease the risk that advanced AI surpasses the capabilities of human intelligence. Musk has stated on a number of occasions that he believes uncontrolled, unregulated advanced general artificial intelligence poses an existential risk to humanity, and Neuralink is intended to be a means of protection against that threat.
We don’t yet know what Musk and Neuralink will be sharing about the company’s progress since its last update in 2019, but hopefully we’re hear something about its plans to begin human trials. Musk also shared what he calls Neuralink’s “mission statement” alongside the date of the company update: “If you can’t beat em, join em.”
When Nicole Poindexter left the energy efficiency focused startup, Opower a few months after the company’s public offering, she wasn’t sure what would come next.
At the time, in 2014, the renewable energy movement in the US still faced considerable opposition. But what Poindexter did see was an opportunity to bring the benefits of renewable energy to Africa.
“What does it take to have 100 percent renewables on the grid in the US at the time was not a solvable problem,” Poindexter said. “I looked to Africa and I’d heard that there weren’t many grid assets [so] maybe I could try this idea out there. As I was doing market research, I learned what life was like without electricity and I was like.. that’s not acceptable and I can do something about it.”
Poindexter linked up with Joe Philip, a former executive at SunEdison who was a development engineer at the company and together they formed Energicity to develop renewable energy microgrids for off-grid communities in Africa.
“He’d always thought that the right way to deploy solar was an off-grid solution,” said Poindexter of her co-founder.
At Energicity, Philip and Poindexter are finding and identifying communities, developing the projects for installation and operating the microgrids. So far, the company’s projects have resulted from winning development bids initiated by governments, but with a recently closed $3.25 million in seed financing, the company can expand beyond government projects, Poindexter said.
“The concessions in Benin and Sierra Leone are concessions that we won,” she said. “But we can also grow organically by driving a truck up and asking communities ‘Do you want light?’ and invariably they say yes.”
To effectively operate the micro-grids that the company is building required an end-to-end refashioning of all aspects of the system. While the company uses off-the-shelf solar panels, Poindexter said that Energicity had built its own smart meters and a software stack to support monitoring and management.
So far, the company has installed 800 kilowatts of power and expects to hit 1.5 megawatts by the end of the year, according to Poindexter.
Those micro-grids serving rural communities operate through subsidiaries in Ghana, Sierra Leone and Nigeria, and currently serve thirty-six communities and 23,000 people, the company said. The company is targeting developments that could reach 1 million people in the next five years, a fraction of what the continent needs to truly electrify the lives of the population.
Through two subsidiaries, Black Star Energy, in Ghana, and Power Leone, in Sierra Leone, Energicity has a 20-year concession in Sierra Leone to serve 100,000 people and has the largest private minigrid footprint in Ghana, the company said.
Most of the financing that Energicity has relied on to develop its projects and grow its business has come from government grants, but just as Poindexter expects to do more direct sales, there are other financial models that could get the initial developments off the ground.
Carbon offsets, for instance, could provide an attractive mechanism for developing projects and could be a meaningful gateway to low-cost sources of project finance. “We are using project financing and project debt and a lot of the projects are funded by aid agencies like the UK and the UN,” Poindexter said.
The company charges its customers a service fee and a fixed price per kilowatt hour for the energy that amounts to less than $2 per month for a customers that are using its service for home electrification and cell phone charging, Poindexter said.
While several other solar installers like M-kopa and easy solar are pitching electrification to African consumers, Poindexter argues that her company’s micro-grid model is less expensive than those competitors.
“Ecosystem Integrity Fund is proud to invest in a transformational company like Energicity Corp,” said James Everett, managing partner, Ecosystem Integrity Fund, which backed the company’s. most recent round. “The opportunity to expand clean energy access across West Africa helps to drive economic growth, sustainability, health, and human development. With Energicity’s early leadership and innovation, we are looking forward to partnering and helping to grow this great company.”
It all started with an email from a customer: “Do you know why Bain Capital Ventures is reaching out to me about Clockwise?”
That email would mark the beginning of a journey toward closing $18 million in new funding that will dramatically accelerate my company, Clockwise . It would require getting to know a partner in lockdown, long nights assembling a pitch deck and many bleary-eyed Zoom calls with some of the best VCs in the world.
Here’s how Ajay Agarwal from Bain Capital Ventures and I established trust online, how I made high-stakes decisions in extreme economic uncertainty and how we were able to turn the pandemic’s constraints into opportunities.
Let’s start at the beginning.
Clockwise was founded in late fall of 2016. We realized that, as personal as time is, our schedules inside modern work environments are intertwined by a network of calendar events and attendees. People schedule meetings without considering the preferences of colleagues by simply hunting for any available “white space” (read: time to do real work). The net effect is that our most valuable resource, time, is easy to take and almost impossible to protect.
More than two years later, in June of 2019, we launched Clockwise to the public. After years of experimentation and refinement, we delivered to the world an intelligent calendar assistant that frees up your time so you can focus on what matters. Workers soon confirmed our hunch that they’re hungry for a tool that gives them more productive hours in their day. Our rapid user growth carried throughout 2019.
By January of 2020, we were on fire. Since January 1, our user base has grown by more than 90%, expanding at a clip of well over 5% week-over-week. As people sought remote tools during shelter-in-place, our rate of growth accelerated even further.
Our growth, incredible team, top-tier existing investors (Accel and Greylock) and strong cash position meant we didn’t need to raise additional capital until the fall of 2020. While COVID-19 certainly sent shock waves through the community, I was in regular communication with a few highly engaged investors who still seemed eager to invest in the future of productivity. I felt cautiously confident more capital could wait.
But, you know, best-laid plans.
The economic lockdown resulting from the coronavirus pandemic has had an immediate negative impact on renewable energy projects and electric vehicles sales, but the sustainable trends are still in place and may even be strengthened over the longer term.
For the first time in four decades, global installation of solar, wind and other renewable energy will be less than the previous year, according to the International Energy Agency, which is projecting a 13% reduction in installations in 2020 compared to 2019. Woods Mackenzie projects an 18% reduction for global solar installations in 2020. Morgan Stanley is projecting declines in U.S. solar PV installations from 48% in second quarter to 17% in the fourth quarter of 2020.
This is due to a combination of construction delays, supply chain disruptions and a capital crunch.
Installation of rooftop solar has been hit particularly hard. Access to homes and businesses was generally halted in March 2020 for several months. Installers have indicated that as much as half the workforce had to be furloughed. The supply chain was also disrupted as PV manufacturing in China was temporarily suspended. Installations and the supply chain will resume, and most contracts are still in place, but the robust projected growth in rooftop PV for 2020 will not be met, and it may take more than a year to catch up. Also, some businesses that planned installations may have higher priorities for cash and investment now as they reopen. Many of the small businesses planning solar installations may not return at all.
On the other hand, utility scale electricity generation from renewable energy continues to grow and take market share. In the first part of this year, renewable energy has produced more electricity than coal for the first time since the late 19th century, when hydropower started the power industry. Wind and solar are the cheapest alternatives for new electric generation in the U.S. The pandemic and collapse in oil prices will not change that. The closure of coal plants has been accelerating this year, and wind and solar will continue to be competitive with gas.
Furthermore, most solar and wind farms were already financed and construction underway in rural areas not affected by the lockdown. About 30 GW of new solar capacity have already been contracted, and as long as interest rates remain low, financing should not be a problem. In fact, many solar and wind projects in the U.S and China are rushing to completion this year to qualify for government incentives.
But supply chains for utility scale renewables were still disrupted. Solar panel manufacturing in China was halted during the first quarter and has now reopened, but facing reduced orders. At one point, 18 wind turbine manufacturing facilities in Spain and Italy were stopped while social distancing and sanitation measures were put in place. Mining operations in Africa and other countries were also temporarily halted and now face reduced demand.
The replacement of oil and gas electricity generation with renewables in developing countries is not going to seem as attractive as a few years ago. Emerging economies need to expand electricity as cheaply as possible, which means coal, gas and even diesel plants. New fossil fuel plants in developing nations could lock in carbon emissions for years.
Electric vehicle sales globally have also been severely impacted. The transition to electric vehicles takes place as people purchase new vehicles. The price of oil has collapsed, used-car prices are dropping and unemployment has soared to levels not seen since the Great Depression. Cheap gas, cheap cars and high unemployment will dramatically lower the expectations for multipassenger EV sales in 2020. Wood Mackenzie has projected a 43% global decline in EV sales in 2020 from 2019. Furthermore, many new electric models from the automakers are not expected until 2021.
However, the long-term transition to EVs will continue and may even accelerate. It still costs less to drive a mile on electricity compared to gasoline, and when the upfront cost of electric vehicles becomes competitive with internal combustion vehicles in a few years, the market should quickly move to EVs. Now that the battery range is adequate for the average driver, the last barrier seems to be the availability of fast charging stations between cities.
Before the collapse in oil demand this year, the oil majors were expecting peak oil demand to occur sometime during the 2040s. Now peak oil demand is expected earlier, perhaps in the mid-2020s. Some even think that 2019 might turn out to be the highest level of oil consumption historically. At any rate, it seems that it will be at least a few years until the 2019 levels are reached again, if ever.
However, the recent collapse in oil prices means the oil and gas industry will be able to supply fuel at very competitive prices for decades. This will at least make it more difficult for electric vehicles to take market share in the short term, and very difficult for alternative liquid fuels to be competitive. For biofuels and synthetic fuels, it seems to be a repeat of earlier decades when cheap oil crushed those industries. Replacing gas and diesel-powered cars is certainly going to be unattractive in the impoverished economies of developing nations.
But there are also bright spots for clean transportation alternatives emerging. Electric bicycles, for example, are a hot item. As people look for alternatives to mass transit and want something to move outdoors in the fresh air, electric-assisted bikes are a great solution and are no longer looked down upon as a vehicle for older (or lazy) cyclists.
Telecommuting struggled for years to take hold, but the pandemic seems to have finally changed that. The recent national lockdown has spurred many large businesses to set up their employees to work from home. They have found that it works fairly well, and many will not return to packed downtown offices.
Several experts have cited the potential for cleaner energy alternatives because the public is seeing cleaner air and the environmental benefits of a 30% reduction in daily oil consumption. Some consumer surveys have indicated a greater interest in electric vehicles.
There is certainly the hope that we will take the opportunity to revive the economy with cleaner technologies than before the lockdown. However, the reality is that workers and businesses need to start up again with the infrastructure they have, and investment in cleaner technology requires capital. Since many business operations are struggling to find cash and loans to just remain open, new clean technology may be delayed.
Yet the major infrastructure changes for a sustainable future are well underway. Solar and wind are rapidly replacing fossil fuels for electricity. Automakers and governments are committed to electrification of the transportation sector. The pandemic may be a near-term obstacle, but the transition to a sustainable economy is just delayed and may even be accelerated in the coming years.
DroneBase, a Los Angeles-based provider of drone pilots for industrial services companies, has raised $7.5 million during the pandemic to double down on its work with renewable energy companies.
While chief executive Dan Burton acknowledged that the company was fundraising prior to the pandemic, the industrial lockdown actually accelerated demand for the company’s services.
Even with the increased demand, the company had to make some changes. It laid off six employees and refocused its business.
“In the past three months it’s become clear that this is a moment for drones as an industry,” Burton said. “We were really pushing hard as a company, certainly on revenue growth and harvesting all the investments we made in technology and having a clear, near-term view to profitability.”
The new round, which closed in May, was a slight down round, according to people familiar with the company’s business.
“We see raising a growth round later this year,” Burton said.
In all, DroneBase has raised nearly $32 million in financing, according to a company statement.
The new round will enable the company to focus on its data and analytics services that it has been developing around its core drone pilot provisioning technology — and gives DroneBase more financial wherewithal to expand its European operations under the DroneBase Europe, which operates out of Germany.
“DroneBase’s expansion into renewable energy reflects our belief in the growth potential of wind and solar energy industries,” said Burton in a statement. “Since many energy companies have both wind and solar assets, we are well positioned to leverage our DroneBase Insights platform to grow our global market share in renewable energy.”
The key application for DroneBase has been allowing wind power companies to monitor and manage their turbines, improving uptimes and spotting problems before they effect operations, the company said.
For solar power companies, DroneBase offers a network of pilots trained in infrared imaging to detect anomalies like defects or hot spots on solar panels, the company said.
“DroneBase has established themselves as the drone leader in the commercial market, and its new work in renewables will have a lasting impact on the future of energy by keeping infrastructure operational for generations,” says Sam Teller, Partner at Valor Equity Partners, in a statement. “We believe DroneBase will continue to be a valuable partner in drone operations and data analysis across a multitude of industries globally.”
Looking for a way to get your early-stage startup the massive attention it deserves? Look no further. TechCrunch is highlighting over 30 companies at Disrupt SF. Selected companies will get a video interview with TC editorial that will be shared with the masses. One of the best ways to get in front of thousands of influencers is by exhibiting in Startup Alley during Disrupt 2020. An even better way is to exhibit for free. Take the first step and apply to be a TC Top Pick.
Applying is easy, but earning the TC Top Pick designation — well, not so much. Discerning TechCrunch editors scour every application searching for creative, potential-laden startups that spark the imagination. Each startup that joins the ranks of the TC Top Picks wins an interview on TechCrunch and a free Digital Startup Alley Package. That’s where the massive exposure comes into play. Everyone — investors, tech media, founders, devs, engineers, R&D folks and more — wants to meet and greet those who made the grade.
Ready to take your shot? Here’s what you need to know. You’re eligible to apply if your pre-Series A startup falls into one of the following categories:
Social Impact + Education, Space, Artificial Intelligence + Machine Learning, Biotech + Healthtech, Enterprise + SaaS, Fintech, Mobility, Retail + E-commerce, Robotics, Hardware + IOT, and Security + Privacy.
TechCrunch editors will choose up to three startups in each category. Note the phrase “up to three.” They won’t fill the bucket without ample cause. What do you get with a Digital Startup Package? Plenty. For starters, it lets three people from your company exhibit from anywhere — remember, virtual Disrupt 2020 is a global event with a global audience. That’s huge.
You’ll demo like crazy — scheduling 1:1 video meetings with the previously mentioned masses — investors, media, potential customers, collaborators and the list goes on. Here’s more good news. You’ll have CrunchMatch, our AI-powered networking platform, to help make your networking easier and more efficient. The platform opens weeks ahead of Disrupt, giving you even more time to find and connect with people who can move your business forward.
Thanks to this next perk, the exposure you get as a TC Top Pick will stretch far beyond Disrupt. TechCrunch editors will create a video interview for each Top Pick startup and promote the videos across its social media platforms. It’s a long-term marketing tool you can use to pitch potential investors and clients.
Does your early-stage startup deserve massive attention? Take advantage of this massive opportunity to keep your startup on track and moving forward. Apply to be a TC Top Pick today.
Is your company interested in sponsoring or exhibiting at Disrupt 2020? Contact our sponsorship sales team by filling out this form.
While we’re preparing to launch a six-wheeled robotic rover roughly the size of a car to explore Mars, future planetary exploration and science missions could employ much smaller hardware – including, potentially swarms of robots the size of insects designed to act in concert with one another autonomously.
Swarming insect-like robots are being developed by a number of different institutions and companies, but a researcher at California State University Northridge recently received a sizeable Department of Defense grant specially to fund the development of autonomous robot swarms for extraterrestrial applications – as well as for use right here on Earth in mining, industrial and search and rescue efforts.
The grant, for $539,000, was awarded to CSUN mechanical engineering professor Nhut Ho, who also directs the NASA Autonomous Research Center for STEAMH (which focuses on collaborative research efforts between Science, Technology, Entrepreneurship, Arts, Humanities and Mathematics academics, hence the acronym). The goal of the research is to build robotic swarms that can essentially be dropped into unknown and hostile environments, and then figure out how to complete specific tasks they’re given without essentially any additional input.
Ultimately, such a swarm would be able to perform complex problem solving to deal with challenges, including organizing themselves into different sized groups to handle different aspects of the task at hand, as well as dealing with setbacks including losing individual members of the swarm through redundancy and repurposing.
One way the system will be tested is through use with a collaborating team from NASA Jet Propulsion Laboratory (JPL) that seeks to find the best solutions for autonomously navigating and mapping underground environments.
As for why this approach is even being considered, there are a lot of potential benefits of using a swarm of small rovers vs. a single, large one. At a very basic level, there’s built-in redundancy – if a rover like NASA’s Perseverance encounters a fatal error, the mission is essentially done, while a swarm losing individual members shouldn’t end the entire mission. Also, a swarm can self-assemble into individual subunits and cover more ground more quickly, accomplishing a number of goals in parallel where a larger rover might have to handle tasks in sequence.
CSUN is working with partners including JPL, as mentioned, as well as Boston Dynamics, Intel, Clearpath Robotics, Telerob, Veoldyne and Silvus Technologies on its swarm project. It could be a while before any insect bots actually set ‘foot’ on the red planet, but this is definitely a strong sign of interest and support from large, deep-pocketed public funding sources.