Browsing Tag: Gadgets

Influential entrepreneurs like Paul Graham and Naval Ravikant always preach the need for startups to have founders-turned-investors on their cap table. As Ravikant puts it, “founders want to know that the people they are taking money from have first-hand experience.” 

His platform AngelList has helped individual founders-cum-investors source and participate in deals via collectives. However, some venture firms have taken this up a notch by bringing founders to create a fund and invest together.

Today, one of such, MAGIC Fund, a global collective of founders, is announcing that it has raised a second fund of $30 million to continue backing early-stage startups across Africa, Europe, Latin America, North America, and Southeast Asia.

Since the firm’s first fund launched in 2017, MAGIC has invested in 70 companies at pre-seed and seed stages across these emerging markets. Some of these companies include Retool, Novo, Payfazz, and Mono.

MAGIC Fund has 12 founders who act as general partners. TechCrunch caught up with managing partner Adegoke Olubusi and operating partner Matt Greenleaf to learn more about the fund’s thesis and activities.

Olubusi, who had built and exited a couple of startups over the years, also dabbled with angel investing for some time. In 2017, Olubusi’s current startup Helium Health got accepted into Y Combinator. It was there he met more founders like him who were angel investors with impressive portfolios. The interesting bit? Each founder wanted to invest in other companies during YC’s Demo Day.

“So about three years ago, I was at YC, and I was going to invest in my own batch. I was pitching on the day, but I was also listening to other pitches. However, it wasn’t just me; there were many other founders as well,” Olubusi said.

After building and exiting multiple startups, some founders turn into angel investing to support startups and their ecosystems. However, most of them tend to go alone and are stuck with cutting checks in their local markets, which limits opportunities.

Here’s a scenario. In 2016, when unicorns Flutterwave and Kavak raised their seed rounds in Nigeria and Mexico respectively, an African biotech founder who knew about Kavak and a Latin American edtech founder interested in African fintech would not have had the capacity to evaluate those deals even if they wanted; the reason being a lack of reach and experience in both the industry or geography. 

Olubusi and the other founders knew this would be a limitation in the long run if they went solo. Thus, they decided to create MAGIC. The idea was to bring global founders together with diverse skillsets in diverse industries and geographies to evaluate deals better and drive value for each other. Hence, they can participate in two unicorns instead of one.

“Instead of us investing individually because obviously, we have somewhat limited capacity in terms of how much time we have as founders because of our respective companies, why don’t we collaborate on a strategy together and co-invest together?”

“The way we thought of MAGIC was a fund of micro funds built by founders for founders,” Greenleaf continued.

Fund of micro funds but more than money

In some of the personal conversations I’ve had with founders about their investors, a recurring theme has been that the most useful investors didn’t necessarily sign the biggest checks. It’s a theme Olubusi also relates to all too well.

“It was like every time we think about it, everyone who gave the most money rarely had time for us. It was so frequent that we all identified this as an actual thing. What actually drove value for us were other investors who were founders and operators, and other experienced people who were able to help us find product-market fit and fight regulators. These were actually the people in the trenches with us.”

Olubusi believes the early-stage part of investing, particularly in pre-seed and seed, is where VCs who are founder-operators find their sweet spot. They are precious when startups are trying to figure out product-market fit. And unlike traditional investors who are looking to get multiples on investments, Olubusi argues that for founders-investors, what matters is how much value they can drive for startups.

MAGIC’s play is even more essential considering that it also plays in emerging markets where on-the-ground operational help is needed in industries with numerous unknowns and uncertainties.

“There is so much money in the market now and early-stage decision making at pre-seed and seed should be left in the hands of founders. Because think about it really, to make an evaluation of whether I should invest in a healthcare or fintech company in Africa, it makes sense to have those who’ve spent years battling through it in the trenches make those decisions. And what we’re trying to do with the fund is publish as much information as possible and keep performing at the 100 percentile and say this is still the best strategy and is very scalable.”

MAGIC Fund 1 was $1.5 million and Olubusi says the investments performed 5x over the period of three years. As some of these companies exited, their founders invested in MAGIC and came on board as Fund 2 partners. 

MAGIC has also enlisted additional investors who, according to Olubusi, are respected for their investing abilities and ecosystem support. For instance, Olugbenga Agboola, Flutterwave CEO, is known across the African tech ecosystem as a founder who goes out of his way to help established and up-and-coming fintech companies. Hendra Kwik of Payfazz has such a reputation in Southeast Asia as well. They, alongside other founders, join MAGIC as limited partners.

Per the firm’s statement, one-third of the entire fund was contributed by the founder GPs. For its LPs, diversity play is considered as 50% of them are black while 33% are women. Some of them include Michael Seibel, Tim Draper, Rappi’s Andres Bilbao, Paystack’s Shola Akinlade, Katie Lewis, and Octopus Ventures’ Kirsten Connell. For its partners, MAGIC has brought on the likes of Stitchroom’s Tom Chen, Medumo’s Adeel Yang, Juice’s Michael Lisovetsky, and Troy Osinoff, and Evercare’s Temi Awogboro.

Magic Fund 2 will be writing $100,000 to 300,000 checks at pre-seed and seed stages focusing on fintech, healthcare, SaaS and enterprise, women’s health, developer tools.

What does the fund look for in founders? Olubusi gives two answers. One, MAGIC wants to back founders with incentives to stick through the hard times of a company.

“At pre-seed and seed, you don’t have enough data about a company to make an investment decision. Your bet is entirely on the founder and the founding team. What we know, having done this several times, is that things get harder. So when we’re looking at the founder, we’re evaluating whether or not the founder has the grit to stick through the toughest times which are going to come up.”

The second indicator factors if the founder has the willingness, openness, the flexibility to learn and use that knowledge to succeed. Greenleaf believes these strategies have incredibly helped the firm fund exceptional companies and maintain good relationships with founders.

“Most of these founders don’t view us as their investors. They view us as fellow founders who are helping them along their journey. I think that also ties into them keeping it real with us and allows us to see them as people, and not just founders. That’s one of the things that have worked in our favor,” he said.

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Business trip booking platform TravelPerk has bagged another rival — picking up UK-based Click Travel. Terms of the deal are not being disclosed but we’re told it’s the third — and largest — acquisition for TravelPerk to date.

The Barcelona-based startup has been on a bit of a shopping spree since the pandemic crisis hit Europe last year, picking up risk management startup Albatross in summer 2020 to bolster resilience to COVID-19’s impacts, before going on to acquire US-based NexTravel in January to expand its presence in the US market.

The latest acquisition deepens TravelPerk’s UK and European business, adding Click Travel’s 2,000+ SME clients (which includes the likes of Five Guys, Red Bull and Talk Talk) to its customer base — which will total just over 5,000 post-acquisition.

The UK company handles some £300M in business travel for its client base, which will bolster TravelPerk’s revenues going forward. The latter now bills itself as the “leading” travel management platform for the SME market globally and the UK as a whole.

“We are a global travel management platform but our core markets are the US and Europe and we expect both markets to be our primary growth areas this year,” said CEO and co-founder Avi Meir. “At the current moment, the US is our largest market due to the covid restrictions in the EU & UK.”

“Assuming travel restrictions won’t be imposed again, we expect to grow by 200% in 2022 with strong growth in our core markets in the US & EU,” he added.

Click Travel, which is based in Birmingham, was founded all the way back in 1999 — and appears to have raised relatively little venture capital over the years, per Crunchbase. However, in 2018, the veteran player participated in the government-backed Future Fifty scale-up program — and also took in a “multi-million pound” investment from the UK-based Business Growth Fund.

Whether there will be any domestic hang-wringing over a high growth UK business being sold to a European rival remains to be seen.

In a statement on its sale to TravelPerk, CEO James McLean omitted to mention the pandemic’s impact on the travel sector — choosing instead to highlight what he couched as the pair’s shared “mission” to reduce the cost and complexity of business travel.

“Those shared objectives, combined with the natural cultural fit between our two companies, means we are incredibly excited to bring our teams together. Combining TravelPerk’s industry-leading knowledge, technology, experience and first class customer support with our own is a powerful proposition and we can’t wait to get started,” McLean added.

While Click Travel has focused on serving the UK market, TravelPerk has had a global focus from the start.

It has also attracted a large amount of external investment (totalling just under $300M) over its shorter run (founded in 2015).

Back in April, for example, it raised a $160M Series D round. It had also topped up its Series C round in July 2019 before the pandemic hit. So TravelPerk hasn’t been short of funds to ride out the COVID-19 revenue crunch — and as well as shopping for competitors it has also been able to avoid making any layoffs over the travel crisis. 

Per a press release, capital to fund the Click Travel acquisition was provided by Boston-based investment manager, The Baupost Group.

TravelPerk’s Meir remains bullish about the near-term prospects for growth in the business travel sector, despite ongoing concerns in Europe and the US about the more infectious ‘Delta’ variant of the virus which is contributing to surging rates of COVID-19 in some markets (including the UK) — claiming it’s already seeing green shoots of recovery in “key markets”.

“TravelPerk is outgrowing the market pace and is already at above 2019 revenue figures,” Meir told TechCrunch. “When it comes to the rest of the industry, the recovery of travel is well underway but moving at different speeds in different markets. For instance in the US, according to TSA Checkpoint figures, at the current rate of recovery the US travel market is expected to reach pre-pandemic volume at the end of August 2021.

“We anticipate the global market may take a little longer but are optimistic we will see close to pre-pandemic levels in 2022.”

“We’re one of the few players in the travel industry that continued scaling and growing since the beginning of the pandemic with a strategy that didn’t involve any layoffs,” he also told us. “Since March last year, our strategy has been not to sit back but to be aggressive and invest massively in our product offering and in our global reach, so that we are in the best position possible to capitalise when travel makes its full recovery. Today’s news is a major part of that plan.

“We will aim to continue being aggressive in our growth strategy and we are open to more acquisitions if they make strategic sense and are aligned with our vision and culture.”

Per Meir, Click Travel and TravelPerk will initially continue to run as two independent platforms but he confirmed that an “eventual full integration” is planned — with both set to operate under the TravelPerk brand in time.

The startup also says it will retain all Click Travel’s staff — denying it has plans to axe any jobs. It also intends to hold onto the company’s Birmingham base — having the city as another UK hub for its business (in addition to its existing London office).

“The 150 amazing people working for Click Travel were a big reason why we wanted to acquire the company, and were priced into the deal,” said Meir. “We have no plans of redundancies. We rather aim to integrate the entire team into the TravelPerk Group.”

Asked if TravelPerk might consider expanding its focus to also target the enterprise segment, he noted that it’s seen interest from larger businesses — and said he’s “open” to the idea — but for now Meir said TravelPerk remains fully focused on the SME market: “where we think there is the biggest need, and the biggest growth potential”.

“That’s why this acquisition is so exciting for us; it makes us undoubtedly the leading travel management platform for SMEs globally,” he added.

Flexibility and sustainability

Discussing how the pandemic has changed business travel, Meir highlighted two “important trends” he said TravelPerk will continue to invest it: Namely flexibility for bookings; and sustainability so environmental impact can be reduced.

TravelPerk plans to invest more than $100M in two key products in these areas (aka: FlexiPerk and GreenPerk), per Meir.

“We’ve noticed on our platform that travellers are booking closer to their departure date: Before the pandemic, trip searches were usually conducted between 7 and 30 days prior to the selected departure date,” he said, elaborating on the importance of flexibility for the sector. “Now we are seeing most trip searches are for trips less than 6 days away. Flexibility is therefore one of the most in-demand perks in business travel. Travellers will rely on flexible fares to give them the peace of mind that they won’t lose money if they need to change or cancel a trip on short notice.”

On sustainability, Meir said businesses are already looking for ways to reduce their carbon footprint and general environmental impact, while consumers are also wanting to make conscientious decisions to reduce carbon emission — suggesting that train-based travel is set to gain ground (vs flights) as a result. (That might, ultimately, require some creative retooling of TravelPerk’s logo — which prominently features an airplane icon… )

“We expect to see significant interest in our carbon offsetting product, GreenPerk, as a result but we also expect to see changes in how people are choosing to travel,” he said.

“For instance, rail is undoubtedly the more environmentally-friendly travel option. In fact, taking a train over a domestic flight can reduce an individual’s carbon emissions by about 84%. We have been building out our rail inventory for a number of years now and we expect train travel to be an increasingly popular business travel option for customers this year and next.”

As for the changing mix of business-related travel in a pandemic-reconfigured world of remote work, Meir continues to argue that more businesses providing employees with remote working options will sum to more business travel overall.

“This might be bad news for the daily commute but it will result in more business travel,” he suggested. “Whether they are going fully remote and ‘working from anywhere’, or operating on a hybrid model, distributed teams will need (and want) to come together. We believe there will be a new type of business trip — one where team members will travel from different working hubs to get together for teambuilding and brainstorming sessions, for meetings with clients and colleagues, and even for ‘bleisure’ (business and leisure) trips.”

French startup ManoMano has raised a Series F funding round of $355 million led by Dragoneer Investment Group. The company operates an e-commerce platform focused on DIY, home improvement and gardening products. It is currently available in six European countries. Following today’s funding round, the company has reached a valuation of $2.6 billion.

In addition to Dragoneer Investment Group, Temasek, General Atlantic, Eurazeo, Bpifrance’s Large Venture fund, Aglaé Ventures, Kismet Holdings and Armat Group are also participating.

“We operate in Europe and we are the industry leader in online sales,” co-founder and co-CEO Philippe de Chanville told me. In France in particular, the company has been profitable for a couple of years already. In 2020 alone, the company’s gross merchandise volume doubled to €1.2 billion ($1.42 billion at today’s rate).

So why did the company raise given that it’s already in a strong position to replicate the same model in other European markets? Because they could and because they didn’t need to. With a high valuation, ManoMano could raise quite a bit of money without having to sell a significant chunk of its equity.

In addition to France, the startup operates in Spain, Italy, Belgium, Germany and the U.K. With today’s funding round, the company wants to develop its activities in the U.K. and Germany in particular — they are Europe’s two biggest markets for home improvement and gardening.

ManoMano sells products to hobbyists and also targets the B2B market with ManoManoPro. It’s already working well in France with very small teams (1 to 5 employees) and the company is expanding this offering to Spain and Italy.

The startup will also invest more heavily in its product and build a better logistics infrastructure. “For the logistics part, we work with third-party logistics companies — we are a tech company,” co-founder and co-CEO Christian Raisson told me.

ManoMano doesn’t have its own warehouses and doesn’t own any inventory. That’s why ManoMano plans to recruit 1,000 people over the next 18 months and most of them will be tech profiles.

While ManoMano has 7 million clients, sales of home improvement and gardening items still mostly happen in brick-and-mortar stores. The startup is well aware that it’s not just a matter of having the best products at good price points.

ManoMano works with advisors (or Manodvisors) so that experts can give advice whenever customers need some tips. Overall, customers have initiated 2.3 million conversations with advisors in 2020. Recommendations and advice will be key to gain market shares. And the company is now well capitalized to innovate on this front and differentiate itself from other e-commerce platforms.

E-commerce is booming in Southeast Asia, but in many markets, the fragmented logistics industry is struggling to catch up. This means sellers run into roadblocks when shipping to buyers, especially outside of major metropolitan areas, and managing their supply chains. Locad, a startup that wants to help with what it describes as an “end-to-end solution” for cross-border e-commerce companies, announced today it has raised a $4.9 million seed round.

The funding was led by Sequoia Capital India’s Surge (Locad is currently a part of the program’s fifth cohort), with participation from firms like Antler, Febe Ventures, Foxmont, GFC and Hustle Fund. It also included angel investors Alessandro Duri, Alexander Friedhoff, Christian Weiss, Henry Ko, Huey Lin, Markus Bruderer, Dr. Markus Erken, Max Moldenhauer, Oliver Mickler, Paulo Campos, Stefan Mader, Thibaud Lecuyer, Tim Marbach and Tim Seithe.

Locad was founded in Singapore and Manila by Constantin Robertz, former Zalora director of operations Jannis Dargel and Shrey Jain, previously Grab’s lead product manager of maps. It now also has offices in Australia, Hong Kong and India. The startup’s goal is to close the gap between first-mile and last-mile delivery services, enabling e-commerce companies to offer lower shipping rates and faster deliveries while freeing up more time for other parts of their operations, such as marketing and sales conversions.

Since its founding in October 2020, Locad has been used by more than 30 brands and processed almost 600,000 items. Its clients range from startups to international brands, and include Mango, Vans, Payless Shoes, Toshiba and Landmark, a department store chain in the Philippines.

Locad is among a growing roster of other Southeast Asia-based logistics startups that have recently raised funding, including Kargo, SiCepat, Advotics and Logisly. Locad wants to differentiate by providing a flexible solution that can work with any sales channel and is integrated with a wide range of shipping providers.

Robertz told TechCrunch that Locad is able to keep an asset-light business model by partnering with warehouse operators and facility managers. What the startup brings to the mix is a cloud software platform that serves as a “control tower,” letting users get real-time information about inventory and orders across Locad’s network. The company currently has seven fulfillment centers, with four of its warehouses in the Philippines and the other three in Singapore, New South Wales, Australia and Hong Kong. Part of its funding will be used to expand into more Asia-Pacific markets, focusing on Southeast Asia and Australia.

Locad’s seed round will also used to add integrations to more couriers and sales channels (it can already be used with platforms like Shopify, WooCommerce, Amazon, Shopee, Lazada and Zalora), and develop new features for its cloud platform, including more data analytics.

Meet Tinybird, a new startup that helps developers build data products at scale without having to worry about infrastructure, query time and all those annoying issues that come up once you deal with huge data sets. The company ingests data at scale, lets you transform it using SQL and then exposes that data through API endpoints.

Over the past few years, analytics and business intelligence products have really changed the way we interact with data. Now, many big companies store data in a data warehouse or a data lake. They try to get insights from those data sets.

And yet, extracting and manipulating data can be costly and slow. It works great if you want to make a PowerPoint presentation for your quarterly results. But it doesn’t let you build modern web products and data products in general.

“What we do at Tinybird is we help developers build data products at any scale. And we’re really focused on the realtime aspect,” co-founder and CEO Jorge Gómez Sancha told me.

The team of co-founders originally met at Carto. They were already working on complex data issues. “Every year people would come with an order of magnitude more data,” Gómez Sancha said. That’s how they came up with the idea behind Tinybird.

The product can be divided into three parts. First, you connect your Tinybird account with your data sources. The company will then ingest data constantly from those data sources.

Second, you can transform that data through SQL queries. In addition to the command-line interface, you can also enter your SQL queries in a web interface, divide then into multiple steps and document everything. Every time you write a query, you can see your data filtered and sorted according to your query.

Third, you can create API endpoints based on those queries. After that, it works like a standard JSON-based API. You can use it to fetch data in your own application.

What makes Tinybird special is that it’s so fast that it feels like you’re querying your data in realtime. “Several of our customers are reading over 1.5 trillion rows on average per day via Tinybird and ingesting around 5 billion rows per day, others are making an average of 250 requests per second to our APIs querying several billion row datasets,” Gómez Sancha wrote in an email.

Behind the scene, the startup uses ClickHouse. But you don’t have to worry about that as Tinybird manages all the infrastructure for you.

Right now, Tinybird has identified three promising use cases. Customers can use it to provide in-product analytics. For instance, if you operate a web hosting service and wants to give some analytics to your customers or if you manage online stores and want to surface purchasing data to your customers, Tinybird works well for that.

Some customers also use the product for operational intelligence, such as realtime dashboards that you can share internally within a company. Your teams can react more quickly and always know if everything is running fine.

You can also use Tinybird as the basis for some automation or complex event processing. For instance, you can leverage Tinybird to build a web application firewall that scans your traffic and reacts in realtime.

Tinybird has raised a $3 million seed round led by Crane.vc with several business angels also participating, such as Nat Friedman (GitHub CEO), Nicholas Dessaigne (Algolia co-founder), Guillermo Rauch (Vercel CEO), Jason Warner (GitHub CTO), Adam Gross (former Heroku CEO), Stijn Christiaens (co-founder and CTO of Collibra), Matias Woloski (co-founder and CTO of Auth0) and Carsten Thoma (Hybris co-founder).

Until children reach a certain age, enrichment programs are somewhat limited to school, sports, and camps, while money-making opportunities are largely non-existent.

Now, a year-old, L.A.-based startup called Mighty, a kind of Shopify that invites younger kids to open a store online, aims to partly fill the void. In fact, Mighty — led by founders Ben Goldhirsh, who previously founded GOOD magazine, and Dana Mauriello, who spent nearly five years with Etsy and was most recently an advisor to Sidewalk Labs — hopes to woo families with the pitch that it operates at the center of fintech, ed tech, and entertainment.

As often happens, the concept derived from the founders’ own experience. In this case, Goldhirsh, who has been living in Costa Rica, began worrying about his two daughters, who attend a small, six-person school. Because he feared they might fall behind their stateside peers, he began tutoring them when they arrived home, using Khan Academy among other software platforms. Yet the girls’ reaction wasn’t exactly positive.

“They were like, “F*ck you, dad. We just finished school and now you’re going to make us do more school?’”

Unsure of what to do, he encouraged them to sell online the bracelets they’d been making, figuring it would teach them needed math skills, as well as teach them about startup capital, business plans (he made them write one), and marketing. It worked, he says, and as he told friends about this successful “project-based learning effort,” they began to ask if he could help their kids get up and running.

Fast forward and Goldhirsh and Mauriello — who ran a crowdfunding platform that Goldhirsh invested in before she joined Etsy — say they’re now steering a still-in-beta startup that has become home to 3,000 “CEOs” as Mighty calls them.

The interest isn’t surprising. Kids are spending more of their time online than at any point in history. Many of the real-world type businesses that might have once employed young kids are shrinking in size. Aside from babysitting or selling cookies on the corner, it’s also challenging to find a job before high school, given the Department of Labor’s Fair Labor Standards Act, which sets 14 years old as the minimum age for employment. (Even then, many employers worry that their young employees might be more work than is worth it.)

Investor think it’s a pretty solid idea, too. Mighty recently closed on $6.5 million in seed funding led by Animo Ventures, with participation from Maveron, Humbition, Sesame Workshop, Collaborative Fund and NaHCO3, a family office.

Still, building out a platform for kids is tricky. For starters, not a lot of 11-year-olds have the tenacity required to sustain their own business over time. While Goldhirsh likens the business to a “21st century lemonade stand,” running a business that doesn’t dissolve at the end of the afternoon is a very different proposition.

Goldhirsh acknowledges that no kid wants to hear they have to “grind” on their business or to follow a certain trajectory, and he says that Mighty is certainly seeing kids who show up for a weekend to make some money. Still, he insists, many others have an undeniably entrepreneurial spirit and says they tend to stick around.  In fact, says Goldhirsh, the company — aided by its new seed funding — has much to do in order to keep its hungriest young CEOs happy.

Many are frustrated, for example, that they currently can’t sell their own homemade items through Mighty. Instead, they are invited to sell items like customizable hats, totes, and stickers made by Mighty’s current manufacturing partner, Printful, which then ships out the item to the end customer. (The Mighty user gets a percentage of the sale, as does Mighty.)

The budding tycoons on the platform can also sell items made by global artisans through a partnership that Mighty has struck with Novica, an impact marketplace that also sells through National Geographic.

The idea was to introduce as little friction into the process as possible at the outset, but “our customers are pissed — they want more from us,” says Goldhirsh, explaining that Mighty fully intends to one day enable its smaller entrepreneurs to sell their own items, as well as offer services (think lawn care), which the platform also does not support currently.

As for how it makes money, in addition to collecting transaction-based revenue, Mighty plans to layer in subscription services eventually, even while it’s not prepared to discuss these publicly quite yet.

It’s intriguing, on the whole, though the startup could need to fend off established players like Shopify should it begin to gain traction. It’s also conceivable that parents — if not children’s advocates —  could push back on what Mighty is trying to do. Entrepreneurship can be alternately exhilarating and demoralizing after all; it’s a roller coaster some might not want kids to ride from such a young age.

Mauriello insists they haven’t had that kind of feedback to date. For one thing, she says, Mighty recently launched an online community where its young CEOs can encourage one another and trade sales tips, and she says they are actively engaging there.

She also argues that, like sports or learning a musical instrument, there are lessons to be learned by creating a store on Mighty. Storytelling and how to sell are among them, but as critically, she says, the company’s young customers are learning that “you can fail and pick yourself back up and try again.”

Adds Goldhirsch, “There are definitely kids who are like, ‘Oh, this is harder than I thought it was going to be. I can’t just launch the site and watch money roll in.’ But I think they like the fact that the success they are seeing they are earning, because we’re not doing it for them.”