FreshRSS

🔒
❌ About FreshRSS
There are new available articles, click to refresh the page.
Before yesterdayYour RSS feeds

Real estate startup Homie plans to expand to more cities with $23 million in Series B funding

By Sarah Buhr

Homie has made an impression among younger, first-time home buyers in the Utah and Arizona markets for cutting out the traditional closing costs, 6% real estate commissions and arduous paperwork associated with traditional home sales. It now plans to explore opening up in three new markets and will begin a Vegas launch in March with a fresh infusion of $23 million in Series B equity financing.

While most real estate outfits now cater to customers online, Homie takes a different approach, employing real estate agents who will help them through the process but who don’t take a commission. Instead, sellers get a $1,500 flat fee and buyers and sellers are guaranteed built-in attorney assistance for the negotiation process.

The 6% traditional commission associated with the home-buying process has been around for decades. However, it has also come under fire from the Department of Justice, which recently disagreed with a motion from the National Association of Realtors to dismiss several civil lawsuits lobbied against the organization. The move hints that the U.S. government may see these fees as archaic and unjustified, as well.

How do traditional agents feel about a proposed loss of commission? Those outside of Homie TechCrunch spoke to on anonymity have said it often takes more work with less pay to close a deal this way. However, that structure seems to resonate with Homie users. Through Homie, the company claims to have saved over $55 million in commissions, with a revenue growth of 150% over the past year. This bodes well for the company, if true.

The ability to expand is also a possibly good marker for the health of the company. Homie co-founder Johnny Hanna told TechCrunch previously he’d looked at the Vegas area, as well as Dallas for expansion.

A few other places we could see Homie pop up in the next year include Boise, Seattle, Colorado Springs and Nashville.

The other new news out of Homie this year is the addition of real estate adjacent services like Homie Loans™, Homie Title™ and Homie Insurance™, all of which serve to streamline the process for customers.

“Buying or selling a home is expensive and time-consuming because of all the different companies you have to work with,” Hanna said in a statement. “Communication becomes a game of telephone because of all the parties involved. We are disrupting the traditional model and saving customers thousands of dollars by combining technology, a team of experts, and a one-stop-shop for real estate. Technology has changed everything except the real estate business model. That time has finally come.”

Utah tech magnates create new Silicon Slopes Venture Fund to boost startups in the state

By Sarah Buhr

Those looking outside of Silicon Valley as a potential hub for their startup might want to take a gander at Utah — at least that’s the kind of trend the new Silicon Slopes Venture Fund hopes to create.

The newly formed fund, put together by Qualtrics co-founder Ryan Smith, Omniture and Domo founder Josh James and Stance co-founder turned Pelion Venture Partners’ Jeff Kearl, pledges to invest solely in Utah-based startups. The goal? To become every bit as notable as a16z or Sequoia Capital.

Qualtrics co-founder Ryan Smith and Domo and Omniture founder Josh James onstage at the Silicon Slopes Tech Summit.

“I grew up in the Bay Area,” Kearl told TechCrunch of the energy he feels in the state. “This feels like the 1990s in the Bay Area. You can find hundreds of open jobs up and down the Wasatch Front.”

Utah has a reputation as a mostly religious, conservative and sleepy mountain region for outdoors enthusiasts but tech has fast become the leading job sector in the state, with some salaries from companies like Adobe and Qualtrics rivaling those in Silicon Valley. The state recently pledged a push to include at least one computer science course in every high school in the state by 2022 and also just hosted a massive, 25,000 person startup festival called the Silicon Slopes Tech Summit, where it held a Utah state governor’s debate and both Steve Case and Mark Zuckerberg spoke on stage.

It’s unclear how much the fund has set aside for its mission to help Utah become a full-fledged tech ecosystem rivaling Silicon Valley but one would imagine it would have a sizable sum to invest, if, as Smith tells TechCrunch, it is to help Utah’s up-and-coming startups go all the way from seed stage to IPO.

“I want to see companies get even bigger than Qualtrics…and do it in this state,” Smith said. Qualtrics sold to SAP in 2019 for $8 billion, notably the largest private enterprise software deal in tech history.

Silicon Slopes Tech Summit 2020 Gubernatorial Debate

One of the many issues tech hubs around the world face is both the networking capabilities and the ability to invest after the seed stage or Series A. Most startups throughout the globe still find the need to travel and make connections in Silicon Valley to get them through the next step of growth. This has been true for every billion-dollar startup idea in Utah as well so far. Both Smith and James took in Silicon Valley venture for their companies, as did unicorn turned public ed tech startup Pluralsight and the recently rebranded sales platform Xant (formerly InsideSales), before making it big.

However, this new fund represents the kind of push needed to create a strong innovation ecosystem in the future, as Steve Case mentioned on stage at the summit event this last week. “Venture capitalists must look at ‘what’s happening in the Silicon Slopes’ and make sure it ‘is happening other places’,” Utah newspaper Deseret News paraphrased the AOL founder as saying.

Pelion Venture Partners, which operates in both Utah and Southern California, will act as a support to Silicon Slopes Venture Fund, providing organizational overhead. Each partner will still keep their day job and donate most fees to support the ongoing operation of the non-profit tech organization, Silicon Slopes, which runs the annual tech summit of the same moniker. However, the Silicon Slopes Venture Fund will be an independent fund from Pelion, with the sole purpose of investing in deal flow the three partners find through their respective networks within the state.

“I used to hate the term ‘a rising tide lifts all boats’ because I want to be the only boat,” James told TechCrunch. “But I really think it applies here for what we are trying to do [in Utah].”

In the shadow of Amazon and Microsoft, Seattle startups are having a moment

By Kate Clark

Venture capital investment exploded across a number of geographies in 2019 despite the constant threat of an economic downturn.

San Francisco, of course, remains the startup epicenter of the world, shutting out all other geographies when it comes to capital invested. Still, other regions continue to grow, raking in more capital this year than ever.

In Utah, a new hotbed for startups, companies like Weave, Divvy and MX Technology raised a collective $370 million from private market investors. In the Northeast, New York City experienced record-breaking deal volume with median deal sizes climbing steadily. Boston is closing out the decade with at least 10 deals larger than $100 million announced this year alone. And in the lovely Pacific Northwest, home to tech heavyweights Amazon and Microsoft, Seattle is experiencing an uptick in VC interest in what could be a sign the town is finally reaching its full potential.

Seattle startups raised a total of $3.5 billion in VC funding across roughly 375 deals this year, according to data collected by PitchBook. That’s up from $3 billion in 2018 across 346 deals and a meager $1.7 billion in 2017 across 348 deals. Much of Seattle’s recent growth can be attributed to a few fast-growing businesses.

Convoy, the digital freight network that connects truckers with shippers, closed a $400 million round last month bringing its valuation to $2.75 billion. The deal was remarkable for a number of reasons. Firstly, it was the largest venture round for a Seattle-based company in a decade, PitchBook claims. And it pushed Convoy to the top of the list of the most valuable companies in the city, surpassing OfferUp, which raised a sizable Series D in 2018 at a $1.4 billion valuation.

Convoy has managed to attract a slew of high-profile investors, including Amazon’s Jeff Bezos, Salesforce CEO Marc Benioff and even U2’s Bono and the Edge. Since it was founded in 2015, the business has raised a total of more than $668 million.

Remitly, another Seattle-headquartered business, has helped bolster Seattle’s startup ecosystem. The fintech company focused on international money transfer raised a $135 million Series E led by Generation Investment Management, and $85 million in debt from Barclays, Bridge Bank, Goldman Sachs and Silicon Valley Bank earlier this year. Owl Rock Capital, Princeville Global,  Prudential Financial, Schroder & Co Bank AG and Top Tier Capital Partners, and previous investors DN Capital, Naspers’ PayU and Stripes Group also participated in the equity round, which valued Remitly at nearly $1 billion.

Up-and-coming startups, including co-working space provider The Riveter, real estate business Modus and same-day delivery service Dolly, have recently attracted investment too.

A number of other factors have contributed to Seattle’s long-awaited rise in venture activity. Top-performing companies like Stripe, Airbnb and Dropbox have established engineering offices in Seattle, as has Uber, Twitter, Facebook, Disney and many others. This, of course, has attracted copious engineers, a key ingredient to building a successful tech hub. Plus, the pipeline of engineers provided by the nearby University of Washington (shout-out to my alma mater) means there’s no shortage of brainiacs.

There’s long been plenty of smart people in Seattle, mostly working at Microsoft and Amazon, however. The issue has been a shortage of entrepreneurs, or those willing to exit a well-paying gig in favor of a risky venture. Fortunately for Seattle venture capitalists, new efforts have been made to entice corporate workers to the startup universe. Pioneer Square Labs, which I profiled earlier this year, is a prime example of this movement. On a mission to champion Seattle’s unique entrepreneurial DNA, Pioneer Square Labs cropped up in 2015 to create, launch and fund technology companies headquartered in the Pacific Northwest.

Boundless CEO Xiao Wang at TechCrunch Disrupt 2017

Operating under the startup studio model, PSL’s team of former founders and venture capitalists, including Rover and Mighty AI founder Greg Gottesman, collaborate to craft and incubate startup ideas, then recruit a founding CEO from their network of entrepreneurs to lead the business. Seattle is home to two of the most valuable businesses in the world, but it has not created as many founders as anticipated. PSL hopes that by removing some of the risk, it can encourage prospective founders, like Boundless CEO Xiao Wang, a former senior product manager at Amazon, to build.

“The studio model lends itself really well to people who are 99% there, thinking ‘damn, I want to start a company,’ ” PSL co-founder Ben Gilbert said in March. “These are people that are incredible entrepreneurs but if not for the studio as a catalyst, they may not have [left].”

Boundless is one of several successful PSL spin-outs. The business, which helps families navigate the convoluted green card process, raised a $7.8 million Series A led by Foundry Group earlier this year, with participation from existing investors Trilogy Equity Partners, PSL, Two Sigma Ventures and Founders’ Co-Op.

Years-old institutional funds like Seattle’s Madrona Venture Group have done their part to bolster the Seattle startup community too. Madrona raised a $100 million Acceleration Fund earlier this year, and although it plans to look beyond its backyard for its newest deals, the firm continues to be one of the largest supporters of Pacific Northwest upstarts. Founded in 1995, Madrona’s portfolio includes Amazon, Mighty AI, UiPath, Branch and more.

Voyager Capital, another Seattle-based VC, also raised another $100 million this year to invest in the PNW. Maveron, a venture capital fund co-founded by Starbucks mastermind Howard Schultz, closed on another $180 million to invest in early-stage consumer startups in May. And new efforts like Flying Fish Partners have been busy deploying capital to promising local companies.

There’s a lot more to say about all this. Like the growing role of deep-pocketed angel investors in Seattle have in expanding the startup ecosystem, or the non-local investors, like Silicon Valley’s best, who’ve funneled cash into Seattle’s talent. In short, Seattle deal activity is finally climbing thanks to top talent, new accelerator models and several refueled venture funds. Now we wait to see how the Seattle startup community leverages this growth period and what startups emerge on top.

After IPOs and acquisitions, a look at Utah’s biggest venture rounds of 2019

By Alex Wilhelm

Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.

This morning we’re dialing into some late-stage venture activity in Utah. Why? Because Utah has become a hotbed of startup activity, yielding both IPOs and huge acquisitions. And as Utah isn’t a media hub in the way that San Francisco and New York City are, it’s often a bit undercovered.

So what better place to cast our eye?

Today we’re going to look at the seven largest venture rounds in the state that have been recorded by Crunchbase in 2019 (no post-IPO action, no grants, no secondaries, no debt, no private equity). We’ll quickly explain each company, look at its investor list, and then ask ourselves how soon we think the company might go public.

Ready?

Countdown

Exploring our seven largest rounds, let’s start from the smallest of the cohort and proceed up in dollar-scale (full list here).

HZO’s $40 million Series D

Based in Draper, Utah, HZO’s tech coats electronics with tiny particles so that the elements can’t wreck them. The startup does more than just coat phones, working with industrial equipment, automotive tech, and IoT tooling.

It’s a business that has attracted well over $100 million in capital to date, according to Crunchbase. That sum includes a $20 million Series B led by Iron Gate Capital, a smaller, $15 million Series C led by Iron Gate Capital, and HZO’s latest $40 million investment led by, you guessed it, Iron Gate Capital. Horizons Ventures has also put money into the company, while Cathay Bank lent it $30 million.

Using our patented gut-check-o-meter, we aren’t expecting an S-1 from HZO soon.

Nav’s $45 million Series C

Another Draper, Utah, company raising large sums this year, Nav is a credit information marketplace for smaller companies. Investigating this morning, Nav feels a bit like Credit Karma, but for SMBs looking at taking on additional credit.

The model has attracted lots of external funding, including a 2015-era Series A from Kleiner that tipped the scales at $8.4 million. Nav’s 2017 Series B weighed in at $37.7 million. And, most recently, it picked up a $44.9 million Series C that was co-led by Experian Ventures, Goldman, and Point72 Ventures.

What’s our IPO guess? Given that it raised a Series C this year, we’d expect at least another round — maybe two — before we see SEC filings of interest from Nav.

Weave’s $70 million Series D

Weave’s Series D is notable in that it valued the company within spitting distance of unicorn status. Indeed, the $70 million round brought its valuation up to $0.97 billion according to Crunchbase.

❌