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Persefoni’s carbon accounting platform raises $9.7 million

By Jonathan Shieber

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

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

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

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

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

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

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

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

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

Alexa von Tobel outlines how founders should manage personal finances

By Jordan Crook

Few people are more knowledgable on the topic of how founders should manage their finances than Alexa von Tobel. She is a certified financial planner, started her own company in the midst of the recession (which happened to be a wildly successful personal finance startup that sold for hundreds of millions of dollars) and is now a VC who invests and advises founders.

At Early Stage 2021, she gave a presentation on how founders should think about managing their own wealth. Startup founders can often put all their money into their venture and end up paying more attention to the finances of their company than their own bank account.

Von Tobel outlined the various steps you can take to stay out of debt, build credit and accumulate wealth through investments to ensure you have financial peace of mind as you take on the most stressful venture of your life: Starting a company.


Know your numbers

The first step in getting organized and being proactive is often taking inventory. Von Tobel believes that knowing your numbers and getting organized digitally is the first step to having financial peace of mind.

Know all your numbers. Know your net worth. What are your assets? What’s your debt? What does your total financial picture look like? Get everything online. You should have all the mobile apps downloaded so that, in minutes, you can actually see your full financial life. And keep it simple. Fewer accounts are better. I always tell people, if you have seven credit cards, plus three savings accounts, that’s a lot. You’re never going to be as good at managing your finances. Simplify your accounts. (Time stamp — 2:50)


Manage your credit and debt

Pale Blue Dot aims to be Europe’s premier early-stage climate investor and has $100 million to prove it

By Jonathan Shieber

When Hampus Jakobsson, Heidi Lindvall, and Joel Larsson, all well-known players in the European venture ecosystem, began talking about their new firm Pale Blue Dot, they began by looking at the problems with venture capital.

For the three entrepreneurs and investors, whose resumes included co-founding companies and accelerators like The Astonishing Tribe (Jakobsson) and Fast Track Malmö (Lindvall and Larsson) and working as a venture partner at BlueYard Capital (Jakobsson again), the problems were clear.

Their first thesis was that all investment funds should be impact funds, and be taking into account ways to effect positive change; their second thesis was that since all funds should be impact funds, what would be their point of differentiation — that is, where could they provide the most impact.

The three young investors hit on climate change as the core mission and ran with it.

As it was closing on €53 million ($63.3 million) last year, the firm also made its first investments in Phytoform, a London headquartered company creating new crops using computational biology and synbio; Patch, a San Francisco-based carbon-offsetting platform that finances both traditional and frontier “carbon sequestration” methods; and 20tree.ai, an Amsterdam-based startup, using machine learning and satellite data to understand trees to lower the risk of forest fires and power outages.

Now they’ve raised another €34 million and seven more investments on their path to doing between 30 and 35 deals.

These investments primarily focus on Europe and include Veat, a European vegetarian prepared meal company; Madefrom, a still-in-stealth company angling to make everyday products more sustainable; HackYourCloset, a clothing rental company leveraging fast fashion to avoid landfilling clothes; Hier, a fresh food delivery service; Cirplus, a marketplace for recycled plastics trading; and Overstory, which aims to prevent wildfires by giving utilities a view into vegetation around their assets. 

The team expects to be primarily focused on Europe, with a few opportunistic investments in the U.S., and intends to invest in companies that are looking to change systems rather than directly affect consumer behavior. For instance, a Pale Blue Dot investment likely wouldn’t include e-commerce filters for more sustainable shopping, but potentially could include investments in sustainable consumer products companies.

The size of the firm’s commitments will range up to €1 million and will look to commit to a lot of investments. That’s by design, said Jakobsson. “Climate is so many different fields that we didn’t want to do 50% of the fund in food or 50% of the fund in materials,” he said. Also, the founders know their skillsets, which are primarily helping early stage entrepreneurs scale and making the right connections to other investors that can add value.

“In every deal we’ve gotten in co-investors that add particular, amazing, value while we still try to be the shepherds and managers and sherpas,” Jakobsson said. “We’re the ones that are going to protect the founder from the hell-rain of investor opinions.”

Another point of differentiation for the firm are its limited partners. Jakobsson said they rejected capital from oil companies in favor of founders and investors from the tech community that could add value. These include Prima Materia, the investment vehicle for Spotify founder Daniel Ek; the founders of Supercell, Zendesk, TransferWise and DeliveryHero are also backing the firm. So too, is Albert Wenger, a managing partner at Union Square Ventures.

The goal, simply, is to be the best early stage climate fund in Europe.

“We want to be the European climate fund,” Lindvall said. “This is where we can make most of the difference.” 

No-code publishing platform Shorthand raises $8M

By Anthony Ha

Shorthand, the Australian startup behind a no-code platform that allows publishers and brands to create multimedia stories, has raised $10 million Australian (just under $8 million U.S.) from Fortitude Investment Partners.

CEO Ricky Robinson told me via email that this is Shorthand’s first institutional round of funding, and that the company has been profitable for the past two years.

“We’ve been lucky enough to grow to where we are today through an entirely inbound, organic model that leverages the beautiful content that our customers create in Shorthand to generate leads,” Robinson wrote. “But we’ve been testing other channels with some success and the time is right to ramp up those other marketing initiatives. That’s where we’ll be spending this funding, while also investing heavily in our product to keep Shorthand at the cutting edge of storytelling innovation for the web.”

Those customers include the BBC, Dow Jones, the University of Cambridge, Nature, Manchester City FC and Peloton. For example, BBC News used Shorthand to create this story about searching for dinosaur fossils.

The Shorthand website extols the virtues of “scrollytelling,” where a reader can trigger interesting transitions and effects simply by scrolling through the story. Robinson suggested that this is a way to make stories feel interactive and engaging “without asking your audience to learn how to interact with it.”

As you can see in the demo video above, Shorthand offers a fairly straightforward drag-and-drop interface for adding different text and media elements, as well as effects. Robinson said that unlike other tools like Webflow and Ceros, Shorthand was designed to be used by editors and writers. And although Shorthand does support the use of themes and templates, he said that’s not enough.

“You need to provide flexibility without making writers get into the weeds of web design or making them use complicated design tools,” he wrote. “The focus should be at the level of story design, not web design, and that’s really what sets Shorthand apart, and it’s why our customers are able to consistently produce highly engaging, award-winning content for their audiences.”

The company also says that demand has only increased during the pandemic, with usage quadrupling in the fourth quarter of 2020 and subscription revenue up 8.8% month-over-month in February of this year.

“The platform offers a rare combination of powerful output and simplicity of use for content creators,” said Fortitude Partner Nick Miller in a statement. “It is clear why the word is spreading about the Shorthand story and what it can do for digital communication.”

Tines raises $26M Series B for its no-code security automation platform

By Frederic Lardinois

Tines, a no-code automation platform co-founded by two senior cybersecurity operators, today announced that it has raised a $26 million Series B funding round led by Addition. Existing investors Accel and Blossom Capital participated in this round, which also includes strategic investments from CrowdStrike and Silicon Valley CISO Investments. After this round, which brings the total funding in the company to $41.1 million, Tines is now valued at $300 million.

Given that Tines co-founders Eoin Hinchy and Thomas Kinsella were both in senior security roles at DocuSign before they left to start their own company in 2018, it’s maybe no surprise that the company’s platform launched with a strong focus on security operations. As such, it combines security orchestration and robotic process automation with a low-code/no-code user interface.

“Tines is on a mission to allow frontline employees to focus on more business-critical tasks and improve their wellbeing by reducing the burden of ‘busy work’ by helping automate any manual workflow and making existing teams more efficient, effective, and engaged,” the company notes in today’s announcement.

The idea here is to free analysts from spending time on routine repetitive tasks and allow them to focus on those areas where they can have the most impact. The tools features pre-configured integrations with a variety of business and security tools, but for more sophisticated users, it also features the ability to hook into virtually any API.

Image Credits: Tines

The company argues that even non-technical employees should be able to learn the ins and outs of its platform within about three hours (sidenote: it’s nice to see a no-code platform acknowledge that users will actually need to spend some time with it before they can become productive).

“If software is eating the world, automation is eating the enterprise,” Hinchy said. “Yet, the majority of progress in this space still requires non-technical teams to depend on software engineers to implement their automation. Other platforms are generally either too hard to use, not flexible enough or not sufficiently robust for mission-critical workflows like cybersecurity. Tines empowers enterprise teams to automate any of their own manual workloads independently, making their jobs more rewarding while simultaneously delivering enormous value for their organizations.”

Current Tines customers include the likes of Box, Canva, OpenTable and Sophos.

The company, which was founded in Dublin, Ireland and recently opened an office in Boston, plans to use the new funding to double its 18-person team in order to support its product growth.

“Tines has quickly established itself as a market leader in enterprise automation,” said Lee Fixel, founder of Addition. “We look forward to supporting Eoin and the Tines team as they continue to scale the business and enhance their product — which is beloved by their unmatched customer base.”

Image Credits: Tines

Coinbase’s monster Q1 in context

By Alex Wilhelm

In the first quarter of 2021, American consumer cryptocurrency trading giant Coinbase grew sharply, generating strong profits at the same time.

For Coinbase, the disclosure of its preliminary Q1 2021 results comes a week ahead of its direct listing, an event that will see the company begin to trade publicly. As it is both cash-rich and well-known, Coinbase is foregoing a traditional IPO in favor of the more exotic method of going public.

In its release, Coinbase disclosed the following metrics, which TechCrunch has compared to metrics from its S-1 filing:

  • Monthly transacting users (MTUs) of 6.1 million, up from 2.8 million at the end of 2020
  • Platform assets of $223 billion, up from $90.3 billion at the end of 2020
  • Trading volume of $335 billion, up from $193.1 billion at the end of 2020
  • Revenue of $1.8 billion, up from $585.1 million in Q4 2020
  • Net income of “approximately $730 million to $800 million,” up from $178.8 million in Q4 2020
  • Adjusted EBITDA of “approximately $1.1 billion,” up from $287.7 million in Q4 2020

The growth of Coinbase from Q4 2020 to Q1 2021 is so extreme that the company’s year-over-year comparisons are farcical. For example, in Q1 2020 Coinbase’s revenues were $190.6 million, or just under 11% of its Q1 2021 top line. The company’s adjusted profits alone in Q1 2021 were more than five times its year-ago revenues.

The new numbers may help solidify some valuation marks that the company has been discussed as approaching, like the $100 billion threshold, or even boost them.

The company did present some warnings in its public release, noting that cryptocurrency price “cycles can be highly volatile, and as a result, [Coinbase] measure[s] [its] performance over price cycles in lieu of quarterly results.” The company also stated that future declines in crypto trading activity will not slow its investment:

MTUs, Trading Volume, and therefore transaction revenue currently fluctuate, potentially materially, with Bitcoin price and crypto asset volatility. This revenue unpredictability, in turn, impacts our profitability on a quarter-to-quarter basis. In terms of expenses, we intend to prioritize investment, including in periods where we may see a decrease in Bitcoin price. This is because we believe that scale is central to achieving our mission and it is still early in the development of this industry. [Emphasis: TechCrunch]

Or more simply, it is willing to sacrifice future profitability if its revenues decline, as it is building for the future instead of hewing to more near-term investor expectations. At least Coinbase is being clear in its messaging to investors; don’t buy Coinbase stock expecting the company to tune its results to quarterly expectations.

Looking ahead, Coinbase did provide some guidance for its full year results. For 2021, the company provided three scenarios. The first “assumes an increase in crypto market capitalization and moderate-to-high crypto asset price volatility,” leading to 7.0 million MTUs. The second “assumes flat crypto market capitalization and low-to-moderate crypto asset price volatility” and 5.5 million MTUs. The third “assumes a significant decrease in crypto market capitalization, similar to the decrease observed in 2018, and low levels of crypto asset price volatility thereafter” and 4.0 million MTUs for the year.

But don’t think that Coinbase is anticipation stagnant growth, simply because its best scenario anticipates mere growth from 6.1 million MTUs to 7.0 million MTUs. The company wrote in its release under the headline “institutional revenue” that it expects “meaningful growth in 2021 driven by transaction and custody revenue given the increased institutional interest in the crypto asset class.”

Coinbase’s quarter was bonkers good. But so was the performance of cryptocurrencies themselves. A bet on the company’s shares, then, could easily be seen as a bet on the value of bitcoin and its ilk. April 14th is going to be a fun day to watch.

India’s CRED valued at $2.2 billion in new $215 million fundraise

By Manish Singh

Two-year-old CRED has become the youngest Indian startup to be valued at $2 billion or higher.

Bangalore-based CRED said on Tuesday it has raised $215 million in a new funding round — a Series D — that valued the Indian startup at $2.2 billion (post-money), up from about $800 million valuation in the $81 million Series C round in January this year.

New investor Falcon Edge Capital and existing investor Coatue Management led the new round. Insight Partners and existing investors DST Global, RTP Global, Tiger Global, Greenoaks Capital, Dragoneer Investment Group, and Sofina also participated in Series D, which brings CRED’s total to-date raise to about $443 million.

TechCrunch reported last month that CRED was in advanced stages of talks to raise about $200 million at a valuation of around $2 billion.

CRED operates an app that rewards customers for paying their credit card bills on time and gives them access to a range of additional services such as credit and a premium catalog of products from high-end brands.

An individual needs to have a credit score of at least 750 to be able to sign up for CRED. By keeping such a high bar, the startup says it is ensuring that people are incentivized to improve their financial behavior. (More on this later.)

CRED today serves more than 6 million customers, or about 22% of all credit card holders — and 35% of all premium credit card holders — in the world’s second largest internet market.

Kunal Shah, founder and chief executive of CRED, told TechCrunch in an interview that the startup intends to become the platform for affluent customers in India and also not limit its offerings to financial services.

He said the startup’s aforementioned e-commerce service, for instance, has been growing fast. He attributed the early success to customers enjoying the curation of items on CRED and merchants finding the platform appealing as the ticket size of each transaction on CRED tends to be higher.

Our focus on helping CRED members progress financially and have access to a high-trust environment has given us a massive opportunity to shape responsible behaviour, imagine new use cases, and create a rewarding platform for members.

— Kunal Shah (@kunalb11) April 6, 2021

The startup plans to deploy the fresh funds to scale several of its revenue channels and engage in more experimentations, he said.

When asked whether CRED would like to serve all credit card users in India some day, Shah said the selection criteria limits the startup from doing so, but he was optimistic that more users will improve their scores in the future.

The startup, unlike most others in India, doesn’t focus on the usual TAM (addressable market) — hundreds of millions of users of the world’s second-most populated nation — and instead caters to some of the most premium audiences.

Consumer segmentation and addressable market for fintech firms in India (BofA Research)

“India has 57 million credit cards (vs 830 million debit cards) [that] largely serves the high-end market. The credit card industry is largely concentrated with the top 4 banks (HDFC, SBI, ICICI and Axis) controlling about 70% of the total market. This space is extremely profitable for these banks – as evident from the SBI Cards IPO,” analysts at Bank of America wrote in a recent report to clients.

“Very few startups like CRED are focusing on this high-end base and [have] taken a platform-based approach (acquire customers now and look for monetization later). Credit card in India remains an aspirational product. The under penetration would likely ensure continued strong growth in coming years. Overtime, the form-factor may evolve (i.e. move from plastic card to virtual card), but the inherent demand for credit is expected to grow,” they added.

CRED has become one of the most talked about startups in India, in part because of the pace at which it has raised money of late, its growing valuation, and the fact that it only caters to select customers.

Some users have also said that CRED doesn’t offer as appealing perks as it used to a year ago.

Shah, who is one of the most prolific angel investors in India and delivered one of the rare successful exits in the country with his previous venture, said CRED is already addressing these concerns. A recent feature, which allows customers to use CRED points at over a thousand merchants, for instance, has made the reward more appealing, he said, adding that the startup is slowly incorporating that into its own e-commerce store as well.

“What will soon happen is that customers will realize that these points are asset and not a liability. They will start to see benefits of the points in more places,” he said, adding that the pandemic derailed some of the things CRED had planned.

The startup, which bought back shares worth $1.2 million from employees in January this year, told them in an email today that it will soon be buying back stocks worth $5 million. “As the funding helps CRED invest in its future, hopefully the buyback will help some of you do that too,” the email said.

Bob W, the ‘tech-driven’ hospitality provider, raises €10M in seed funding

By Steve O'Hear

Bob W, the self-described “tech-driven” hospitality provider that offers an alternative to traditional hotels and short-stay rentals, is disclosing €10 million in seed funding.

Leading the round, which included a first tranche of €4 million last year, is byFounders VC and private equity firm Finnish Industry Investment (Tesi). Other European real estate and venture capitalist investors participating include Kaamos, Superangel, United Angels and NREP (via its anchor investment into the 2150 venture capital fund, which promises to back sustainable urban technologies).

Founded in 2018 by Niko Karstikko and Sebastian Emberger, Bob W — which is a play on the phrase “best of both worlds” — is described as offering tech-powered short-stay apartments that combine hotel-like quality with the authenticity of individual rentals.

Its “full-stack” model sees it source and manage properties and provide an accompanying app for guests, with support for chat-based customer service and contactless online check-in. It also claims to have made the majority of its operations autonomous. “[This] not only minimises human error but also allows the company to craft the entire guest experience, from booking to check-out, at scale,” says the company.

Launched in a number of Nordics markets, and on the verge of opening properties in London, the startup seems to be weathering the pandemic, reaching occupancy rates as high as 90% at its existing properties in Estonia and Finland. Revenue is also said to have grown by 80% in 2020, with the company putting a lot of marketing toward claims behind being more hygienic than many hotels.

“A new generation of travellers have developed a refined taste when it comes to accommodation; they’re mixing business with pleasure and often staying for longer,” says Niko Karstikko co-founder and CEO of Bob W. “They want the reliable quality of a hotel and the authenticity and convenience of a private apartment. The problem is that many hotels feel generic and lack key amenities like kitchens, while booking a private rental feels like playing roulette”.

Despite this contradiction, Karstikko says the short-stay rental market has continued to grow over the past decade with millions of properties available, “demonstrating the demand for home-like settings where guests can live like a local”. And it’s this demand that was the inspiration behind Bob W.

Image Credits: Bob W

“Bob W guarantees the best short-stay apartment experience, which includes the amenities and local authenticity of a home combined with responsive host communication available 24/7, the best professional cleaning program in the industry, curated local service partners (gym, breakfast, etc.), dedicated business services and more”.

This means that guests can rely on “hotel-like consistency” across all of Bob W’s locations, without paying hotel prices and with “the flexibility to stay days, weeks or months”.

Karstikko says a typical Bob W guest is someone who “travels less but stays longer”.

“They often mix business and pleasure and come for leisure, work, digital nomad-ery or just to get away and get a taste of living like a local,” he explains. “To do that, they seek out authentic places to stay which also have the amenities and consistent quality they expect, like a fully equipped kitchen and some elbow room. What they want is a home away from home”.

Meanwhile, direct competitors include the likes of Sonder, Cosi Group, Lime Home and, more broadly, the hotel and short-stay segments. To that end, Karstikko argues that Bob W is the “most local, authentic experience” on the market and offers the most consistent, yet customized experience. It also pitches itself on being more sustainable.

“We have put sustainability at the core of everything we do,” adds the Bob W CEO, “from powering our apartments with 100% renewable energy to recycling, minimising single-use plastic, sourcing furniture responsibly and [other] green initiatives throughout the business. We will also have massive news soon about how we’re taking sustainability to the next level, as all of us need to do more to combat the climate crisis”.

KKR closes $15 billion fund targeting consumption and urbanization in Asia

By Rita Liao

KKR has just closed $15 billion for its Asia-focused private equity fund, exceeding its original target size after receiving “strong support” from new and existing global investors, including those in the Asia Pacific region.

The new close came nearly four years after KKR raised its Asian Fund III of $9.3 billion and marks the New York-based alternative asset management titan’s ongoing interest in Asia. It also makes KKR Asian Fund IV one of the largest private equity funds dedicated to the Asia Pacific region.

KKR itself will inject about $1.3 billion into Fund IV alongside investors through the firm and its employees’ commitments. The new fund will be on the lookout for opportunities in consumption and urbanization trends, as well as corporate carve-outs, spin-offs, and consolidation.

KKR has been a prolific investor in Asia-Pacific since it entered the region 16 years ago with a multifaceted approach that spans private equity, infrastructure, real estate and credit. It currently has $30 billion in assets under management in the region.

The firm has been active during COVID-19 as well. On the one hand, the pandemic has accelerated the transition to online activities and singled out tech firms that proved resilient during the health crisis. Market disruption in the last year has also made valuations more attractive and pressured companies to seek new sources of capital. All in all, these forces provide “increasingly interesting opportunities for flexible capital providers like KKR,” the firm’s spokesperson Anita Davis told TechCrunch.

Since the pandemic, KKR has deployed about $7 billion across multiple strategies in Asia.

While KKR looks for deals across Asia, each market provides different opportunities pertaining to the state of its economy. For deals in consumption upgrades, KKR seeks out companies in emerging markets like China, Southeast Asia and India, said Davis. In developed countries like Japan, Korea and Australia, KKR observed that continued governance reform, along with a focus on return on equity (ROE), has driven carve-outs from conglomerates and spin-offs from multinational corporations, Davis added.

Specifically, KKR’s private equity portfolio in Asia consists of about 60 companies across 11 countries. Some of its more notable deals include co-leading ByteDance’s $3 billion raise in 2018 amid the TikTok parent’s rapid growth and bankrolling Reliance Jio with $1.5 billion in 2020.

“The opportunity for private equity investment across Asia-Pacific is phenomenal,” said Hiro Hirano, co-head of Asia Pacific Private Equity at KKR. “While each market is unique, the long-term fundamentals underpinning the region’s growth are consistent — the demand for consumption upgrades, a fast-growing middle class, rising urbanization, and technological disruption.”

The Asian Fund IV followed in the footsteps of KKR’s two other Asia-focused funds that closed in January, the $3.9 billion Asia Pacific Infrastructure Investors Fund and the $1.7 billion Asia Real Estate Partners Fund.

Sarah Kunst will outline how to get ready to fundraise at Early Stage

By Jordan Crook

Sarah Kunst, founding partner at Cleo Capital, has worn many hats. She’s been an entrepreneur, served on plenty of boards, is a contributing author at Marie Clare, has been a senior advisor to Bumble and worked as a consultant in marketing, business development and more.

And with all that experience, she knows all too well that the process of fundraising starts well before your first pitch meeting. That’s why we’re so excited to have Kunst join us at Early Stage in July to discuss how to get ready to fundraise.

This isn’t the first time Kunst has discussed the topic with us. On a recent episode of Extra Crunch Live, Kunst and one of her portfolio company founders Julia Collins described how to conduct the process of fundraising.

For example, there is a story to tell, metrics to share and an art to building momentum before you ever start filling your calendar. That all requires preparation, and Kunst will outline how to go about that at our event in July.

Early Stage is going down twice this year, with our first event taking place tomorrow! Here’s a look at some of the topics we’ll be covering:

Fundraising

  • Bootstrapping Best Practices (Tope Awotona and Blake Bartlett, Calendly)
  • Four Things to Think About Before Raising a Series A (Bucky Moore, Kleiner Perkins)
  • How to Get An Investor’s Attention (Marlon Nichols, MaC Venture Capital)
  • How to Nail Your Virtual Pitch Meeting (Melissa Bradley, Ureeka)
  • How Founders Can Think Like a VC (Lisa Wu, Norwest Venture Partners)
  • The All-22 View, or Never Losing Perspective (Eghosa Omoigui, EchoVC Partners)

Operations:

  • Finance for Founders (Alexa von Tobel, Inspired Capital)
  • Building and Leading a Sales Team (Ryan Azus, Zoom CRO)
  • 10 Things NOT to Do When Starting a Company (Leah Solivan, Fuel Capital)
  • Leadership Culture and Good Governance (David Easton, Generation Investment Management)

The cool thing about Early Stage is that it’s heavy on audience Q&A, ensuring that everyone gets the chance to ask their own specific questions. Oh, and ticket holders get free access to Extra Crunch.

Interested? You can buy a ticket here.

Pipe, which aims to be the ‘Nasdaq for revenue,’ raises more money at a $2B valuation

By Mary Ann Azevedo

Fast-growing fintech Pipe has raised another round of funding at a $2 billion valuation, just weeks after raising $50M in growth funding, according to sources familiar with the deal.

Although the round is still ongoing, Pipe has reportedly raised $150 million in a “massively oversubscribed” round led by Baltimore, Md.-based Greenspring Associates. While the company has signed a term sheet, more money could still come in, according to the source. Both new and existing investors have participated in the fundraise.

The increase in valuation is “a significant step up” from the company’s last raise. Pipe has declined to comment on the deal.

A little over one year ago, Pipe raised a $6 million seed round led by Craft Ventures to help it pursue its mission of giving SaaS companies a funding alternative outside of equity or venture debt.

The buzzy startup’s goal with the money was to give SaaS companies a way to get their revenue upfront, by pairing them with investors on a marketplace that pays a discounted rate for the annual value of those contracts. (Pipe describes its buy-side participants as “a vetted group of financial institutions and banks.”)

Just a few weeks ago, Miami-based Pipe announced a new raise — $50 million in “strategic equity funding” from a slew of high-profile investors. Siemens’ Next47 and Jim Pallotta’s Raptor Group co-led the round, which also included participation from Shopify, Slack, HubSpot, Okta, Social Capital’s Chamath Palihapitiya, Marc Benioff, Michael Dell’s MSD Capital, Republic, Alexis Ohanian’s Seven Seven Six and Joe Lonsdale.

At that time, Pipe co-CEO and co-founder Harry Hurst said the company was also broadening the scope of its platform beyond strictly SaaS companies to “any company with a recurring revenue stream.” This could include D2C subscription companies, ISP, streaming services or a telecommunications companies. Even VC fund admin and management are being piped on its platform, for example, according to Hurst.

“When we first went to market, we were very focused on SaaS, our first vertical,” he told TC at the time. “Since then, over 3,000 companies have signed up to use our platform.” Those companies range from early-stage and bootstrapped with $200,000 in revenue, to publicly-traded companies.

Pipe’s platform assesses a customer’s key metrics by integrating with its accounting, payment processing and banking systems. It then instantly rates the performance of the business and qualifies them for a trading limit. Trading limits currently range from $50,000 for smaller early-stage and bootstrapped companies, to over $100 million for late-stage and publicly traded companies, although there is no cap on how large a trading limit can be.

In the first quarter of 2021, tens of millions of dollars were traded across the Pipe platform. Between its launch in late June 2020 through year’s end, the company also saw “tens of millions” in trades take place via its marketplace. Tradable ARR on the platform is currently in excess of $1 billion.

IoT satellite network startup Hiber secures €26M in funding round led by EU’s innovation agency

By Mike Butcher

European satellite and communications startup, Hiber BV has secured €26 million in EU and private investment to expand its IoT satellite network.  The funding comes from the European Innovation Council Fund (EIC Fund), the EU’s innovation agency, which has a €278 million Innovation Fund. The EIC co-invested with an innovation credit provided by the Dutch government and existing shareholders. Other investors include Finch Capital, Netherlands Enterprise Agency and Hartenlust Group. Hiber’s satellite constellation tracks and monitors machines and devices in harder-to-reach places.

At the same time co-founder of Hiber, Laurens Groenendijk, is to step aside as managing director to turn his attention to “other investment initiatives” the company said in a statement. Steven Kroonsberg joins as CFO. Roel Jansen joins as CCO. Groenendijk has been Co-founder and Chief Executive Officer at Treatwell as well as a serial investor.

Coen Janssen, Chief Strategy Officer and co-founder of Hiber, commented: “The €26 million funding is fantastic validation for Hiber’s success and a major boost for the European ‘New Space’ sector. It is a key step in realizing our aim of making the Internet of Things really simple and available for everyone in remote and developing regions of the world.”

In particular, because it can reach out-of-the-way areas, Hiber’s network may be able to reduce losses in food production and leakages from oil wells.

Nicklas Bergman, European Innovation Council Fund Committee Member, commented: “I am glad to announce the EIC Fund support to this highly innovative company aiming at creating a European champion in the satellite Internet of Things sector. This equity financing will help Hiber to enable affordable and ubiquitous connectivity for the IoT solutions.”

Elia Montanari, Head of Management and Control at the European Space Agency, commented: “This major success has been supported at European level by collaboration of major EU bodies (EIC, EIB, ESA) fostering the Space Value Chain”.

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

By Jonathan Shieber

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

LA’s socially conscious bank challenger, Aspiration, launches a carbon offset credit card

By Jonathan Shieber

Aspiration, the financial services business for socially conscious consumers, is back with another environmentally friendly offering for its customers — this time, it’s a credit card.

The Los Angeles-based company, which has raised roughly $250 million from investors including the celebrities Leonardo DiCaprio, Robert Downey Jr.’s Footprint Coalition, and Orlando Bloom and more traditional institutional investors like AlphaEdison, Capricorn Investment Group, the Omidyar Network, and Allen & Co., wouldn’t say how much about the terms of the card or the credit limits available.

What Aspiration co-founder Andrei Cherny did discuss was the company’s sense of the significance of its new offering.

“There are plenty of credit cards out there that let you rack up miles, this is the only card that rewards you for taking miles off of the planet,” Aspiration co-founder and CEO Andrei Cherny said in a statement. “For the first time, you can have a climate change-fighting tool right in your wallet.” 

The key to Aspiration’s offset services is nothing more or less than tree planting. It’s the easiest way for consumers to eventually cancel out the greenhouse gas emissions associated with daily living in the U.S.

Every time someone uses the card, Aspiration will have one of its global reforestation partners plant a tree. If a customer uses Aspiration’s credit card 60 times, the resulting trees that are planted are enough to offset the carbon emissions from an average American home

“What we’re doing is basing it on the average American’s carbon footprint,” Cherny affirmed. “Every time you make a purchase Aspiration plants your tree. The way the math works out. The average carbon impact of the average tree when you have 60 of them you eliminate the emissions from an average American home.”

Using Aspiration’s app, which includes other tools for consumers to gauge the social impact of their purchases, credit card customers can track their progress towards offsetting their emissions. For every month in which a user gets to carbon zero, Aspiration will reward them with 1% cashback on their credit card purchases.

Cherny said the company works with accredited partners and uses satellite imaging and on-the-ground monitoring to ensure that the forestation projects are proceeding according to plan and that the trees aren’t being harvested.

The company isn’t just doing this out of a sense of corporate responsibility there’s actually an arbitrage case where the planting of seeds becomes a profit center (however nominal) for the company.

“As we get to scale that will be the case,” Cherny said. “We are not a nonprofit, we’re a for-profit company dedicated to saving the planet. Until people can make a profit off of saving the planet in the same way people have been profiting on destroying the planet, there are going to continue to be problems… If only oil companies and incumbent banks can make money by destroying the planet, then we’re in trouble.”

Pacaso raises $75M, goes from launch to unicorn in 5 months

By Mary Ann Azevedo

Pacaso, a less-than-one-year-old startup that is out to give more people a chance at second home ownership, announced Wednesday that it has received $75 million in growth funding at a $1 billion valuation.

Greycroft and Global Founders Capital co-led the $75 million in equity financing, which is notable for a few reasons.

For one, the team. Former Zillow executives Austin Allison and (CEO and co-founder) Spencer Rascoff came up with the concept of Pacaso after leaving Zillow together about 18 months ago. (Publicly traded Zillow today has a market cap of $32.9 billion.) The company gives people the ability to purchase shares in, and become co-owners of, a second home.

“We realized that owning a second home had been a very impactful luxury in both of our lives. We’re both fortunate enough to have second homes, and it made a huge difference to us and our friends and family,” Rascoff said. “What we set out to do was to try to democratize access to second homeownership so that it can be something that is not just a luxury available to the 1%, but hopefully it can be available to many tens of millions of other people around the world.”

Something else that stands out about this raise is that Pacaso, which just launched in October 2020, has achieved unicorn status faster than any other company, according to an internal company analysis of Crunchbase data.

“Pacaso is growing incredibly quickly, faster than anything I’ve never been a part of,” Rascoff told TechCrunch. “And the reason that it’s growing so quickly is because consumers love the concept, and they love the idea of being able to own a second home at a much less expensive price metric.”

In addition to the equity financing announced today, San Francisco-based Pacaso has also secured $1 billion in debt financing from First Republic Bank and funds managed by affiliates of Fortress Investment Group LLC. At the time of its launch last fall, the startup had raised $17 million in a Series A led by Maveron, as well as $250 million in debt financing.

Sukhinder Singh Cassidy and Theresia Gouw of the Acrew Diversify Capital Fund; First American Financial; Shea Ventures; Jeff Wilke, former CEO of Amazon Worldwide Consumer; and other notable angel investors also participated in the latest financing.

With a unique co-ownership model made possible via the creation of a property-specific LLC, the company aims to reduce the cost and hassle of second home ownership. It also gives vacation homeowners an alternative option to renting out their property.

The way it works is that Pacaso purchases a home either outright or shares in a home. The company then partners with local real estate agents to market the properties. It then sells shares in the home — from one-eighth of the home to a greater percentage.

Pacaso holds a brokerage license in more than a dozen top second home markets such as Napa, Lake Tahoe, Palm Springs, Malibu and Park City. Buyers can view curated listings on the startup’s website, which includes active listings, as well as previews of homes under consideration for purchase based on buyer demand.

In addition to curating the listings, Pacaso also offers integrated financing, “upscale” interior design, professional property management and proprietary scheduling technology.

Image Credits: Pacaso

Since launch, Picasso says that more than 500,000 people have visited the website and 60,000 “aspiring buyers” have engaged Pacaso to learn more about second home co-ownership. So far, the company has helped about 100 families become co-owners of second homes.

Allison estimates that there are about 100 million second homes around the world, with the vast majority of those vacant 10 to 11 months a year.

“On a monthly basis, that number is growing very quickly,” he said.

The company plans to use its new capital in part to expand into new markets — moving from the west coast to the east coast. It eventually plans to also expand globally — in Europe and potentially in Mexico and the Caribbean. The debt will go toward purchasing shares of more homes.

“There are many tens of millions of families who make enough money to where they have some discretionary income and about 75% of them are dreaming about owning a second home,” he said. “But they are either held back by cost or the inability to justify such a purchase. So there’s this massive problem and what we’ve come up with is a really innovative solution, which is co-ownership.”

Greycroft co-founder and partner Dana Settle described Pacaso’s business vitals as “nothing short of momentous.”

“Pacaso is creating a new category that will dramatically change how people approach buying and owning a second home,” she added.

As most venture firms are, Greycroft was also attracted to the caliber of Pacaso’s founding team.

“This is a team that knows this market incredibly well and have worked together previously,” Settle told TechCrunch. “When you see how quickly they’ve gotten up and running it’s literally a testament to that point.”

She also likened the company to Uber and Airbnb, which also took otherwise underutilized assets and turned them into a business.

“This is another opportunity to do that — leveraging technology to create more accessibility in a market,” Settle said.

To support its expansion, Pacaso has hired Nina Tran to serve as its chief financial officer. Tran took Waypoint Homes public through its merger with Starwood Waypoint and served as its CFO through its sale to Invitation Homes.

Rascoff has certainly been busy as of late. He’s also heading up Supernova Partners Acquisition Company, which recently announced it was merging with Offerpad to take that company public. Rascoff is also an investor in Doma, formerly called States Title — another proptech that is going public via a SPAC merger. He’s also backed a number of startups, including Cheese, a fintech that recently launched a digital banking platform that is aimed at primarily serving the Asian-American community, among others.

Eat Just (the alt-protein company formerly known as Hampton Creek) has raised another $200 million

By Jonathan Shieber

Eat Just, the purveyor of eggless eggs and mayonnaise and the first government-approved vendor of lab-grown chicken, has raised $200 million in a new round of funding, the company said.

The funding was led by the Qatar Investment Authority, the sovereign wealth fund of the state of Qatar, with additional participation from Charlesbank Capital Partners and Vulcan Capital, the investment arm of the estate of Microsoft co-founder Paul G. Allen.

Since its launch in 2011 as Hampton Creek, the company has raised more than $650 million all to build out capacity for its egg replacement products and its new line of lab-grown meat.

“We are very excited to work with our investors to build a healthier, safer and more sustainable food system. Their knowledge and experience partnering with companies that are transforming numerous industries were fundamental in our decision to partner with them,” said Josh Tetrick, co-founder and CEO of Eat Just, in a statement.

Eat Just’s evolution hasn’t been without controversy. In 2017, the company and its chief executive withstood a failed coup, which forced the firing of several executives. The company also saw its entire board resign in the aftermath of those firings, only to replace them with a new slate of directors months later.

In the aftermath, Hampton Creek rebranded and refocused. These days the company’s products fall into two somewhat related categories. There’re the plant-based egg replacement products and eggless mayonnaise and the lab grown chicken products that are meant to replace poultry farmed chicken meat.

Since the egg side of Eat Just’s chicken and egg business definitely came first, it’s worth noting that the company’s products are sold in more than 20,000 retail outlets and 1,000 foodservice locations. since it began selling the product, the company has moved more than 100 million eggs to roughly one million U.S. households.

The company’s eggs are also on offer in Dicos, a fast food chain in China, and it’s got a deal to put out a sous vide egg replacement product with Cuisine Solutions. The eggs are also available in Peet’s Coffee locations around the country and Eat Just has expanded its eggless distribution platform into Canada.

Then there’s the company’s GOOD Meat product. That was available for a short time in Singapore. The company expects to slash production costs and expand its commercial operations while working on other kinds of meats as well, according to a statement.

It’s a long way from where the Eat Just started, when it raised its first millions from Khosla Ventures and Founders Fund.

Update: Telegram raises $1BN+, including $150M from Mubadala and Abu Dhabi CP via pre-IPO convertible bonds

By Natasha Lomas

Update: Telegram has now announced it’s pulled in over $1BN in debt financing by selling bonds.

Founder Pavel Durov put out an update via his official Telegram channel after a press announcement earlier today had revealed the company had taken in $150M from Mubadala and Abu Dhabi Catalyst Partners by selling 5-year pre-IPO convertible bonds.

It’s not clear where the additional millions in debt funding are coming from — Durov merely writes that Telegram has sold bonds to “some of the largest and most knowledgable investors from all over the world”.

“This will enable Telegram to continue growing globally while sticking to its values and remaining independent,” he goes on, adding that the $1BN debt cushion will also be used to implement a monetization strategy he set out in December — when Durov wrote that “a project of our size needs at least a few hundred million dollars per year to keep going”.

He also committed not to sell Telegram, reiterating then that he wants it to remain independent.

Monetization would be non-intrusive, he pledged too, saying any future move to monetize large one-to-many channels through ads would see benefits flow back to the community — such as in the form of “free traffic in proportion to their size” — while future content sales (like premium stickers) would also entail contributing artists getting “a part of the profit”. “We want millions of Telegram-based creators and small businesses to thrive, enriching the experience of all our users,” was Durov’s pledge in December.

Now he’s got the debt war chest to execute the plan.

Our original report follows below… 

Messaging platform Telegram, which recently passed 500 million monthly active users but still isn’t monetizing all the digital chatter it hosts — has taken in a little more funding to keep its engines ticking over.

Mubadala Investment Company, the Abu Dhabi-based sovereign investor, is throwing in $75M in exchange for 5-year pre-IPO convertible bonds of Telegram — with Abu Dhabi Catalyst Partners investing a further $75M, the pair said today in a press release.

The investment is touted as a strategic partnership, with Mubadala anticipating benefits for Abu Dhabi’s startup ecosystem by having a local Telegram presence drawing in skills and talent to the capital.

Per Reuters Telegram will be opening an office in Abu Dhabi following the investment — building out its regional presence from a Dubai, UAE base.

Commenting in a statement, Pavel Durov, Telegram founder and CEO, said: “We are honoured by the $150M investment into Telegram from Mubadala and Abu Dubai Catalyst Partners. We look forward to developing this strategic partnership to continue our growth in the MENA region and globally.”

To date, Telegram has been bankrolled over a seven+ year lifespan by Durov, who made ~$300M from selling his stake in the vk social network he also founded — aka Russia’s ‘Facebook’ — back in 2015.

But sustaining a messaging platform with half a billion users can’t be done through billionaire bootstrapping alone.

Some additional investment did come in via Telegram’s recent attempt to launch a blockchain platform. However the effort was derailed by US regulators last year — forcing it to refund most (but not all) of the money it had booked for the failed TON platform — so speculation over how Telegram will monetize its platform goes on.

In recent weeks Durov has responded to this chatter via his public Telegram channel to confirm he’s considering introducing ads for “large one-to-many channels” — but pledging he won’t do so in chats.

He has also rejected the notion of using user data to target ads — a move that would undermine the loud privacy promises Telegram repeatedly makes to users to put clear blue water between its platform and the (Facebook-owned) data-mining competition.

“Users will be able to opt out of ads, but I do think that privacy-conscious ads are a good way for channel owners to monetize their efforts — as an alternative to donations or subscriptions, which we are also working to offer them,” Durov wrote last month.

Telegram’s usage has, meanwhile, continued to swell this year — boosted by users switching from Facebook-owned WhatsApp over privacy concerns. So there’s limited room for copycat monetization, unless Durov is willing to trash his personal ‘pro-privacy, pro-user’ brand. To say that’s highly unlikely is an understatement.

Nonetheless, he has further limited his options by rejecting a series of investment offers in recent months.

A report in Russian press earlier this year said he’d rejected an investment offer for a 5%-10% stake in the company that had valued it at $30BN. We’ve also been told he rejected a higher offer that had valued Telegram at $35BN — and another of $4BN at a $40BN pre-money valuation.

“Durov is afraid of investors of any kind,” one source told us on why he refused to give up any equity.

Debt financing seems to be Telegram’s preferred route at this stage. Back in January The Information reported that it was discussing raising up to $1BN in debt financing from with banks and investors — which would convert to shares in an eventual public offering.

That debt route — via pre-IPO convertible bonds — is now taking shape with today’s investment news out of Abu Dhabi. Although $150M is a lot less than the rumoured $1BN so this may be just an initial tranche. (And may in fact be needed to pay back TON investors’ whose refunds are falling due.)

But with a couple of debt backers sticking their necks out to take a punt on Durov’s anti-establishment alternative — and on the chance of an Telegram IPO by 2026 — the company is in a better position to get buy in from other debt funders, including in the region as it deepens its geographical commitment to the Middle East.

One key attraction for Telegram backers is likely to be its agile product dev. There Durov has repeatedly shown he can deliver — growing usage of his platform with the help of a steady pipeline of user-focused features.

Efforts on the product side at this stage look geared towards pivoting into a Patreon-style platform for content creators to build communities of followers willing to pay for their content (which would thereby enable Telegram to monetize by taking a cut as commission).

“Our end goal is to establish a new class of content creators — one that is financially sustainable and free to choose the strategy that is best for their subscribers,” wrote Durov last month. “Traditional social networks have exploited users and publishers for far too long with excessive data collection and manipulative algorithms. It’s time to change this.”

Just over a month later his channel lit up again with more product news — this time capitalizing on the buzz around social audio with the announcement of the launch of a Clubhouse-clone on Telegram channels dubbed “voice chats 2.0”.

He also announced feature that lets admins of channels and public groups host voice chats for millions of live listeners — taking the cap off the earlier feature. “No matter how popular your talk gets, new people will be able to tune in. It’s like public radio reinvented fo the 21st century,” Telegram’s blog post enthused.

Durov had more developments to tease: One-to-many video broadcasts that will see the platform let users host their own ‘TV stations’ which he said will be coming this “spring”. So Telegram continues to evolve as the social app landscape shifts.

Commenting on the debt financing in a statement, James Munce, CFO and COO of Abu Dhabi Catalyst Partners (ADCP), lauded Telegram’s management team’s “unshakeable dedication to building a platform centred around privacy and user experience”.

“We believe this creates a strong value proposition and will be a focal point for social media platforms and a new era of messaging,” he added.


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Nuvemshop, LatAm’s answer to Shopify, raises $90M in Accel-led Series D

By Mary Ann Azevedo

The COVID-19 pandemic has led to people everywhere shopping more online and Latin America is no exception.

São Paulo-based Nuvemshop has developed an e-commerce platform that aims to allow SMBs and merchants to connect more directly with their consumers. With more people in Latin America getting used to making purchases digitally, the company has experienced a major surge in business over the past year.

Demand for Nuvemshop’s offering was already heating up prior to the pandemic. But over the past 12 months, that demand has skyrocketed as more merchants have been seeking greater control over their brands.

Rather than selling their goods on existing marketplaces (such as Mercado Libre, the Brazilian equivalent of Amazon), many merchants and entrepreneurs are opting to start and grow their own online businesses, according to Nuvemshop co-founder and CEO Santiago Sosa.

“Most merchants have entered the internet by selling on marketplaces but we are hearing from newer generations of merchants and SMBs that they don’t want to be intermediated anymore,” he said. “They want to connect more directly with consumers and convey their own brand, image and voice.”

The proof is in the numbers.

Nuvemshop has seen the number of merchants on its platform surge to nearly 80,000 across Brazil, Argentina and Mexico compared to 20,000 at the start of 2020. These businesses range from direct-to-consumer (DTC) upstarts to larger brands such as PlayMobil, Billabong and Luigi Bosca. Virtually every KPI tripled in the company in 2020 as the world saw a massive transition to online, and Nuvemshop’s platform was home to 14 million transactions last year, according to Sosa.

“With us, businesses can find a more comprehensive ecosystem around payments, logistics, shipping and catalogue/inventory management,” he said.

Nuvemshop’s rapid growth caught the attention of Silicon Valley-based Accel. Having just raised $30 million in a Series C round in October and achieving profitability in 2020, the Nuvemshop team was not looking for more capital.

But Ethan Choi, a partner at Accel, said his firm saw in Nuvemshop the potential to be the market leader, or the “de facto” e-commerce platform, in Latin America.

“Accel has been investing in e-commerce for a very long time. It’s a very important area for us,” Choi said. “We saw what they were building and all their potential. So we pre-emptively asked them to let us invest.”

Today, Nuvemshop is announcing that it has closed on a $90 million Series D funding led by Accel. ThornTree Capital and returning backers Kaszek, Qualcomm Ventures and others also put money in the round, which brings Nuvemshop’s total funding raised since its 2011 inception to nearly $130 million. The company declined to reveal at what valuation this latest round was raised but it is notable that its Series D is triple the size of its Series C, raised just over six months prior. Sosa said only that there was a “substantial increase” in valuation since its Series C.

Nuvemshop is banking on the fact that the density of SMBs in Latin America is higher in most Latin American countries compared to the U.S. On top of that, the $85 billion e-commerce market in Latin America is growing rapidly with projections of it reaching $116.2 billion in 2023.

“In Brazil, it grew 40% last year but is still underpenetrated, representing less than 10% of retail sales. In Latin America as a whole, penetration is somewhere between 5 and 10%,” Sosa said.

Nuvemshop co-founder and CEO Santiago Sosa;
Image courtesy of Nuvemshop

Last year, the company transitioned from a closed product to a platform that is open to everyone from third parties, developers, agencies and other SaaS vendors. Through Nuvemshop’s APIs, all those third parties can connect their apps into Nuvemshop’s platform.

“Our platform becomes much more powerful, vendors are generating more revenue and merchants have more options,” Sosa told TechCrunch. “So everyone wins.” Currently, Nuvemshop has about 150 applications publishing on its ecosystem, which he projects will more than triple over the next 12 to 18 months.

As for comparisons to Shopify, Sosa said the company doesn’t necessarily make them but believes they are “fair.”

To Choi, there are many similarities.

“We saw Amazon get to really big scale in the U.S.. Merchants also found tools to build their own presence. This birthed Shopify, which today is worth $160 billion. Both companies saw their market caps quadruple during the pandemic,” he said. “Now we’re seeing the same dynamics in LatAm…Our bet here is that this company and business has all the same dynamics and the same really powerful tailwinds.”

For Accel partner Andrew Braccia, Nuvemshop has a clear first mover advantage.

Over the past decade, direct-to-consumer has become one of the most important drivers of entrepreneurship globally,” he said. “Latin America is no exception to this trend, and we believe that Nuvemshop has the level of sophistication and ability to understand all that change and fuel the continued transformation of commerce from offline to online.”

Looking ahead, Sosa expects Nuvemshop will use its new capital to significantly invest in: continuing to open its APIs; payments processing and financial services; “everything related to logistics and logistics management” and attracting smaller merchants. It also plans to expand into other markets such as Colombia, Chile and Peru over the next 18-24 months. Nuvemshop currently operates in Mexico, Brazil and Argentina.

“While the countries share the same secular trends and product experience, they have very different market dynamics,” Sosa said. “This requires an on the ground local knowledge to make it all work. Separate markets require distinct knowledge. That makes this a more complicated opportunity, but one that enables a long-term competitive advantage.”

Indonesian savings and investment app Pluang gets $20M in pre-Series B funding

By Catherine Shu

Indonesia-based fintech Pluang announced today it has raised $20 million in a pre-Series B round led by Openspace Ventures, with participation from Go Ventures and other returning investors. The company offers proprietary savings and investment products that allow users to make contributions starting from 50 cents USD.

Go Ventures, the investment arm of Gojek, also participated in Pluang’s $3 million Series A, which closed in March 2019. Pluang is available through partnerships with “super apps” like Gojek, Dana and Bukalapak, and currently claims more than one million users.

The company says it is able to maintain a low customer acquisition cost of $2 per transacting customer because it creates its own products, including investment accounts for gold, U.S equity indices and cryptocurrencies, instead of working with third-party financial service providers.

Pluang’s latest round will be used to develop proprietary financial products to cover more asset classes, including government bonds.

“Previously, these assets classes were only available to the wealthy in Indonesia,” said Pluang founder Claudia Kolonas in a statement. “However, we believe that everyone should have the opportunity to grow their savings, and our new products will reflect that.”

Pluang is among several Indonesian financial apps, including Ajaib and Bibit, that have recently raised funding. All focus on making investing accessible to more people by giving them an alternative to traditional brokerage firms that typically charge high fees.

In Indonesia, less than percent of the country’s population are retail investors, but that number is growing, especially among people aged 18 to 30. This is due to a combination of factors, including increased interest in financial planning during the pandemic and the rise of stock influencers.

In a statement, Openspace Ventures founding partner Shane Chesson said, “Pluang has demonstrated tremendous growth over the last 12 months with industry leading unit economics. We’re excited to continue supporting the team, as they sustainably accelerate their ambitions to help every Indonesian grow their savings.”

Aldea Ventures creates ‘hybrid’ European €100M fund to invest both in Micro VCs, plus follow-on

By Mike Butcher

The historical trajectory of venture capital has been to move to earlier and earlier finding rounds in order to capture the greatest potential multiple on exit. In the US, we’ve seen an explosion of Pre-series A funds, and similarly in Europe. But there’s been an opportunity to tie a lot of that activity together and also produce data that can feed into decision-making about growth rounds, further up the funding pipeline. Now, newly-formed Aldea Ventures intends to do just that.

Today’s it’s announcing a €60M first close of its Pan-European fund with the aim of reaching its target €100M first fund. The idea is ambitious: to invest in 700 startups across Europe, but with an unusual, “hybrid” strategy. First up, it will operate as a fund-of-funds, investing in up to 20 early-stage ‘micro VC funds’ across Europe. Second of all, it will act as a co-investment platform from Series A upwards.  So far it has invested in London-based Job and Talent and most recently, Copenhagen-based Podimo.

The model is more common in Silicon Valley than in Europe, so Aldea Ventures hopes to capitalize on this trend as one of the earlier players with this strategy. Aldea is also effectively stepping into the gap where corporate VCs in the US would normally fill, but in Europe is generally a gaping hole.

Aldea Ventures is led by managing partners Carlos Trenchs, formerly at Caixa Capital Risc; Alfonso Bassols, previously at Nauta Capital; Josep Duran, formerly with the European Investment Fund; and Gonzalo Rodés, Chairman. Aldea Ventures is partnering with Meridia Capital, a leading Spanish alternative investment fund manager.

Carlos Trenchs, managing partner of Aldea Ventures, said: “We believe Europe will continue to grow in influence and play an integral part in the next decade of technology… Our dual model as a fund of funds and co-investor into scaleups is the first of its kind in Europe. Seen only in Silicon Valley until today, we’re putting this model to work to fuel the next generation of growth across the European ecosystem.”

Aldea will look for five factors to selecting micro VCs: the firm’s thesis (specialist, thematic or generalist); location (pan-European or local); the experience of the partners; the size of the fund, and whether the fund is emerging or established. The fund will also take a long hard look at AI, Blockchain and DeepTech companies.

Trenchs explained to me during an interview that “we will have exposure to seed capital in different geographies with the 700 companies, and we reserve the other half of the fund to invest directly on the growth stage in the best performers in their portfolios.” This, he says, will establish a roadmap from direct investing all the way up to later-stage rounds.

Aldea has so far made investments into six micro VCs; Air Street Capital and Moonfire in London; Helloworld in Luxembourg; Inventures in Munich; Mustard Seed Maze in Lisbon; and Nina Capital in Barcelona. 

Nathan Benaich, Founding Partner of Air Street Capital, commented: “Investing in  European AI-first companies is a huge opportunity, with almost one-quarter of top global AI talent earning their university degrees here.. Our partnership with Aldea demonstrates a shared conviction that specialist managers with deep sector-specific knowledge will accelerate the success of tomorrow’s category-defining European companies that are AI-first by design.”

There’s clearly also a data play here because Aldea is likely to end up with a lot of data across companies, sectors and also across various stages.

And that was confirmed by Trenchs: “We want to make the VC world more transparent. If you have the 700 companies, in a few years from now, we’ll be able to collect a lot of data about what’s going on at seed stage in European valuations, geographies and sectors. Our intention is of course to use it as intelligence.” He also said the firm intended to share a lot of anonymized data with the wider European ecosystem.

“There is a funnel of few thousands of companies that get funded, but only a few make it through the funnel. As investors, we are looking for venture capitalists that can transform their seed portfolio into a portfolio that graduates from Series A to Series B,” he added.

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