Government services, for many, epitomize the worst of bureaucracy: they are, at their low point, large, lumbering organizations working under strained budgets, staffed by lifer employees who don’t get much say in improving things, and lots of paperwork. But as ageing public information infrastructure grinds to a halt and public services start making the switch to digital, that image is slowly starting to change, and the tech companies helping this along are reaping some of the rewards.

Today, one of them, PayIt — which has designed a platform to take payments and produce related documentation for public services through web and mobile interfaces — announced that it has raised a hefty funding round of more than $100 million to tap that opportunity.

PayIt’s platform is currently operational in the U.S. and covers a variety of applications that fall under the general category of public services that require government organizations and agencies to take money from us and issue us with certificates and other documents confirming we have done something official. They include Courts and Citations, Environmental Services, Health and Human Services, Motor Vehicle, Parks and Wildlife Services, Professional Licensing, Public Safety, Taxes, Turnpike and Tolling and Utilities.

The plan for PayIt will be to expand that list to cover more use cases, to win more business in the U.S., and to also begin the process of breaking into more international markets.

The funding is coming from a single investor, Insight Partners (which used to go by Insight Venture Partners), and it is also notable because of some of the funding context.

Since its founding in 2013, PayIt had only raised $11 million, John Thomson — the CEO who co-founded and runs the company with Michael Plunkett (COO) in Kansas City — told me in an interview.

And in case you are wondering, Thomson added that the reason they’re not disclosing a more exact funding figure — or PayIt’s valuation — is because the company doesn’t want the financial aspects to be the focus: both because he wants this to be about expansion, and because he doesn’t want to give too much information to competitors.

Indeed, while the market is massive — in the U.S. alone, Thomson estimates that some $2 trillion flows between public services and constituents annually — it is also crowded with payment companies that want to tap some of that for themselves.

Competitors include other payment platforms that work with government services, such as Aliant, other payment providers like Stripe and PayPal, companies like Visa, and sometimes even the government itself. Thomson does not divulge what PayIt’s own share of the pie is except to note that it is handling a “small but rapidly growing percentage of the market.”

As citizens, we all know some of the pain points of older systems: they might require in-person visits or snail mail to make payments and procure various official documents. (DMV appointments, for one, can take months to sort out.) As Thomson describes it, what’s going on under the hood is equally as inefficient and slow moving.

“To do business with the government — whether it’s U.S., state or local — the entire burden in many cases is placed on constituents,” Thomson said. Behind the scenes, it’s also bad. There can be “as many as six or seven systems in use to handle a request, a payment and more.”

The idea is that PayIt has built a platform that can integrate all of that into a single process, behind a single front end. “Payments happen in the form of a wallet,” he said, adding that PayIt handles sensitive information in the cloud and doesn’t require users to re-enter too many details, or for too many organizations to have to hand off information between each other to complete a payment subsequent document order. “Consumers love it because it’s like interacting with a business in the private sector,” he said.

PayIt’s notable for straddling two big areas — fintech and govtech. While the former has seen a ton of innovation that has mirrored the growth of the internet overall, tech companies (and governments) have really only started to scratch the surface with the latter. It will be interesting to see how this develops both in terms of innovation, but also where people will potentially draw a line on too much centralised and digitised information. Recent moves in India around Aadhar — which is now the world’s largest biometric ID system — have been more than a little controversial.

For now, however, there are a lot of incremental processes to fix and make efficient, and that is where PayIt sits for now.

Insight Partners is an interesting investor for PayIt in that regard. The VC has a track record for backing startups that are using tech to disrupt and rethink legacy infrastructure, with previous investments including WordPress’s Automattic, BlaBlaCar and N26 in Europe, DocuSign and many more.

“What excited us most about the PayIt platform is its ability to scale and make a true impact on a broad base of stakeholders,” said Ryan Hinkle, managing director at Insight Partners, in a statement provided to TechCrunch.

“We’ve all dreaded having to wait in line for a new driver’s license, or jump through hoops to pay for a parking ticket. It’s clear that with PayIt, that doesn’t have to be the reality. PayIt seeks to dissolve those stressful interactions making processes seamless and simple for constituents and governments, allowing issues to be resolved and revenue to be collected efficiently. At Insight Partners, we’re looking forward to helping John and the team scale the best-in-class platform they’ve already built, and reach new constituents and governments with these solutions.”

Source: Tech Crunch Startups | PayIt, a payments platform designed for public services, raises 0M+ from Insight Partners

Kong, the open core API management and life cycle management company previously known as Mashape, today announced that it has raised a $43 million Series C round led by Index Ventures. Previous investors Andreessen Horowitz and Charles River Ventures (CRV), as well as new investors GGV Capital and World Innovation Lab, also participated. With this round, Kong has now raised a total of $71 million.

The company’s CEO and co-founder Augusto Marietti tells me the company plans to use the funds to build out its service control platform. He likened this service to the “nervous system for an organization’s software architecture.”

Right now, Kong is just offering the first pieces of this, though. One area the company plans to especially focus on is security, in addition to its existing management tools, where Kong plans to add more machine learning capabilities over time, too. “It’s obviously a 10-year journey, but those two things — immunity with security and machine learning with [Kong] Brain — are really a 10-year journey of building an intelligent platform that can manage all the traffic in and out of an organization,” he said.

In addition, the company also plans to invest heavily in its expansion in both Europe and the Asia Pacific market. This also explains the addition of World Innovation Lab as an investor. The firm, after all, focuses heavily on connecting companies in the U.S. with partners in Asia — and especially Japan. As Marietti told me, the company is seeing a lot of demand in Japan and China right now, so it makes sense to capitalize on this, especially as the Chinese market is about to become more easily accessible for foreign companies.

Kong notes that it doubled its headcount in 2018 and now has more than 100 enterprise customers, including Yahoo! Japan, Ferrari, SoulCycle and WeWork.

It’s worth noting that while this is officially a Series C investment, Marietti is thinking of it more like a Series B round, given that the company went through a major pivot when it moved from being Mashape to its focus on Kong, which was already its most popular open-source tool.

“Modern software is now built in the cloud, with applications consuming other applications, service to service,” said Martin Casado, general partner at Andreessen Horowitz . “We’re at the tipping point of enterprise adoption of microservices architectures, and companies are turning to new open-source-based developer tools and platforms to fuel their next wave of innovation. Kong is uniquely suited to help enterprises as they make this shift by supporting an organization’s entire service architecture, from centralized or decentralized, monolith or microservices.”

Source: Tech Crunch Startups | Kong raises M Series C for its API platform

Microsoft today announced a major expansion of its Azure IP Advantage program, which provides its Azure users with protection against patent trolls. This program now also provides customers who are building IoT solutions that connect to Azure with access to 10,000 patents to defend themselves against intellectual property lawsuits.

What’s maybe most interesting here, though, is that Microsoft is also donating 500 patents to startups in the LOT Network. This organization, which counts companies like Amazon, Facebook, Google, Microsoft, Netflix, SAP, Epic Games, Ford, GM, Lyft and Uber among its well over 150 members, is designed to protect companies against patent trolls by giving them access to a wide library of patents from its member companies and other sources.

“The LOT Network is really committed to helping address the proliferation of intellectual property losses, especially ones that are brought by non-practicing entities, or so-called trolls,” Microsoft  CVP and Deputy General Counsel Erich Andersen told me. 

This new program goes well beyond basic protection from patent trolls, though. Qualified startups who join the LOT Network can acquire Microsoft patents as part of their free membership and as Andresen stressed, the startups will own them outright. The LOT network will be able to provide its startup members with up to three patents from this collection.

There’s one additional requirement here, though: to qualify for getting the patents, these startups also have to meet a $1,000 per month Azure spend. As Andersen told me, though, they don’t have to make any kind of forward pledge. The company will simply look at a startup’s last three monthly Azure bills.

“We want to help the LOT Network grow its network of startups,” Andersen said. “To provide an incentive, we are going to provide these patents to them.” He noted that startups are obviously interested in getting access to patents as a foundation of their companies, but also to raise capital and to defend themselves against trolls.

The patents we’re talking about here cover a wide range of technologies as well as geographies. Andersen noted that we’re talking about U.S. patents as well as European and Chinese patents, for example.

“The idea is that these startups come from a diverse set of industry sectors,” he said. “The hope we have is that when they approach LOT, they’ll find patents among those 500 that are going to be interesting to basically almost any company that might want a foundational set of patents for their business.”

As for the extended Azure IP Advantage program, it’s worth noting that every Azure customer who spends more than $1,000 per month over the past three months and hasn’t filed a patent infringement lawsuit against another Azure customers in the last two years can automatically pick one of the patents in the program’s portfolio to protect itself against frivolous patent lawsuits from trolls (and that’s a different library of patents from the one Microsoft is donating to the LOT Network as part of the startup program).

As Andresen noted, the team looked at how it could enhance the IP program by focusing on a number of specific areas. Microsoft is obviously investing a lot into IoT, so extending the program to this area makes sense. “What we’re basically saying is that if the customer is using IoT technology — regardless of whether it’s Microsoft technology or not — and it’s connected to Azure, then we’re going to provide this patent pick right to help customers defend themselves against patent suits,” Andersen said.

In addition, for those who do choose to use Microsoft IoT technology across the board, Microsoft will provide indemnification, too.

Patent trolls have lately started acquiring IoT patents, so chances are they are getting ready to making use of them and that we’ll see quite a bit of patent litigation in this space in the future. “The early signs we’re seeing indicate that this is something that customers are going to care about in the future,” said Andersen.

Source: Tech Crunch Startups | Microsoft gives 500 patents to startups