Browsing Tag: Startups

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

This week we had the full Equity staff on hand to dig through the week’s news, helmed by Kate Clark and Connie Loizos, with Alex Wilhelm in the studio too. Plus, Om Malik, a former scribbler and current venture capitalist, joined us to riff on the latest.

Before we dig into what we covered, a small note from the team: As this episode is going out before Uber will trade, we’ll have another episode coming to you tomorrow after the madness. Stay tuned.

Uber priced its IPO at $45 per share right before we hit record, so we first touched on the final pricing of what should be the year’s largest tech IPO. Pricing toward the lower-end of its range, Uber could be setting itself up for a strong first day. Or, demand was lower than expected following Lyft’s slide. Either way, Uber will trade tomorrow as a public company at last. Om predicts Uber and Lyft rides will get a whole lot more expensive in the next eighteen months, so hold onto your hats, the future for riders and drivers alike is… unclear.

Next, we debated Harry’s exit to Edgewell Personal Care. The direct-to-consumer razor supplier sold this week for more than $1 billion in a deal reminiscent of the Dollar Shave Club’s sale to Unilever. From there, we spoke about the latest from the Luckin Coffee IPO. The news, in brief, is that its IPO is moving forward. Next up is pricing; we’ll be sure to discuss any updates on the podcast.

In big deal news, Carta closed a $300 million round. Connie has learned a lot about the business in recent weeks and it turns out, Om wishes he was an investor!

Finally, Cruise’s latest new round, and the capital needs of autonomous driving. As we all quickly agree, it’s an expensive business and not one that will get cheaper. But, given that so many companies are working on the tech, we hope it works out. Especially Om, who doesn’t have a driver’s license, it turns out.

All that and we had fun! Chat tomorrow!

Source: Tech Crunch Startups | Why Om Malik thinks ‘the VC subsidized life is over’

Daye, a “femcare” startup developing a new type of tampon that uses CBD to help tackle dysmenorrhea, has quietly raised $5.5 million in funding from high-profile investors in the U.S. and Europe, TechCrunch has learned.

Backing the round is Silicon Valley’s Khosla Ventures, along with London’s Index Ventures and Kindred Capital. The investment sees Khosla’s chief of staff Kristina Simmons, Khosla venture partner Tim Westergren (who also founded Pandora), and Hannah Seal, principle at Index, join Daye’s board.

Other investors in the London-based company include Sophia Bendz (former global director of Marketing at Spotify and now a partner at VC firm Atomico), Irina Havas (a principle of Atomico), David Schiff (founding partner at United Talent Agency) and Kristin Cardwell (VP of International Business Development at Refinery29).

Founded by 24-year-old Valentina Milanova and launching later this year, Daye has set out to build a new brand for female health products “designed with women in mind.” The startup’s first product is a newly developed tampon that uses CBD to help tackle period cramps (or dysmenorrhea) as an alternative to traditional painkillers (CBD is the extract derived from the flower of the industrial hemp plant, a legal relative to marijuana). Daye also claims its product will be more hygienic and sustainable than legacy tampons, and if successful could be a wake-up call to the incumbent and stagnant tampon industry, which has seen little innovation in decades.

“Our goal is to raise the standards of women’s hygiene products by tackling three primary issues: dysmenorrhea, manufacturing standards and sustainability,” Milanova tells TechCrunch. “Women have largely been left out of medical innovation. In fact, until 1993, researchers banned women from participating in [early] clinical trials, as it was believed female hormone fluctuations polluted medical data. To this day, most medications, including those for pain relief, depression and sleeping aids, have not been tested on women. We’re redefining localised cramp-relief, relying on an ingredient that we’ve tested on women first.”

Milanova says she first had the idea for a cramp-fighting tampon in November 2017 and initially used her salary from a day job and credit cards to fund product development. In September 2018, she quit her job to work on the business full-time and build a team, and to finalise clinical trials for the product.

Describing CBD as “having its 15 minutes of fame,” Milanova says the company doesn’t believe cannabidiol should be added to everything, from dry shampoo to cocktails. However, she says CBD is much safer than over-the-counter painkillers, and that the vaginal canal has the highest concentration of cannabinoid receptors and is also the fastest route of absorption into the bloodstream when it comes to pain relief.

“Unlike most CBD products on the market today, our product does not contain any tetrahydrocannabinol (THC),” she explains. “This is why we believe we’re going to be attractive to every consumer who experiences menstrual discomfort.”

Beyond the novel idea of a cramp-fighting CBD tampon, Milanova says Daye wants to raise the bar for tampon production standards and sustainability.

“In Europe, tampons are not classified as medical devices, which means there are no manufacturing guidelines — for context, plasters are more regulated and better sanitised than tampons,” she tells me, to my astonishment. To address this, Daye is introducing pharmaceutical-grade standards and will keep manufacturing in-house.

Period care is also “wreaking havoc” on the environment. “Over the course of her lifetime, the average woman uses enough tampons to fill two double-decker buses. That waste either ends up in our oceans or landfills. We want to relieve the burden period care has on the environment, and offer a product that is equal parts body-safe, effective and as sustainable as possible.”

To begin to answer the question of why something like this hasn’t been done before, Milanova says that menstrual discomfort in general is a massively overlooked problem and that “even the mention of the word tampon makes most people feel uncomfortable.”

The existing market is also monopolised “to the point where innovation suffers.” All tampons on the market today perform and look the same, using the same materials and the same manufacturing processes. Yet, because there’s barely any product differentiation, the Daye founder says most women remain loyal to the first tampon brand they ever tried.

“What we’re bringing to market is a completely novel product, and we’re operating in a very sensitive, intimate area of consumer goods. As a newcomer, we have to gain consumer trust by ensuring we’re in constant contact with our users, taking note of their feedback and iterating on our proposition fast.”

Source: Tech Crunch Startups | Daye, a startup developing a ‘cramp-fighting’ tampon, raises .5M from Khosla, Index and Kindred

Cloud kitchens are the big thing in food delivery, with ex-Uber CEO Travis Kalanick’s new business one contender in that space, with Asia, and particularly Southeast Asia, a major focus. Despite the newcomers, a more established startup from Singapore has raised a large bowl of cash to go after regional expansion.

Founded in 2014, Grain specializes in clean food while it takes a different approach to Kalanick’s CloudKitchens or food delivery services like Deliveroo, FoodPanda or GrabFood.

It adopted a cloud kitchen model — utilizing unwanted real estate as kitchens, with delivery services for output — but used it for its own operations. So while CloudKitchens and others rent their space to F&B companies as a cheaper way to make food for their on-demand delivery customers, Grain works with its own chefs, menu and delivery team. A so-called “full stack” model, if you can stand the cliched tech phrase.

Finally, Grain is also profitable. The new round has it shooting for growth — more on that below — but the startup was profitable last year, CEO and co-founder Yi Sung Yong told TechCrunch.

Now it is reaping the rewards of a model that keeps it in control of its product, unlike others that are complicated by a chain that includes the restaurant and a delivery person.

We previously wrote about Grain when it raised a $1.7 million Series A back in 2016, and today it announced a $10 million Series B, which is led by Thailand’s Singha Ventures, the VC arm of the beer brand. A bevy of other investors took part, including Genesis Alternative Ventures, Sass Corp, K2 Global — run by serial investor Ozi Amanat who has backed Impossible Foods, Spotify and Uber among others — FoodXervices and Majuven. Existing investors Openspace Ventures, Raging Bull — from Thai Express founder Ivan Lee — and Cento Ventures participated.

The round includes venture debt, as well as equity, and it is worth noting that the family office of the owners of The Coffee Bean & Tea Leaf — Sassoon Investment Corporation — was involved.

Grain covers individual food as well as buffets in Singapore

Three years is a long gap between the two deals — Openspace and Cento have even rebranded during the intervening period — and the ride has been an eventful one. During those years, Sung said the business had come close to running out of capital before it doubled down on the fundamentals before the precarious runway capital ran out.

In fact, he said, the company — which now has more than 100 staff — was fully prepared to self-sustain.

“We didn’t think of raising a Series B,” he explained in an interview. “Instead, we focused on the business and getting profitable… we thought that we can’t depend entirely on investors.”

And, ladies and gentleman, the irony of that is that VCs very much like a business that can self-sustain — it shows a model is proven — and investing in a startup that doesn’t need capital can be attractive.

Ultimately, though, profitability is seen as sexy today — particularly in the meal space, where countless U.S. startups have shuttered, including Munchery and Sprig — but the focus meant that Grain had to shelve its expansion plans. It then went through soul-searching times in 2017 when a spoilt curry saw 20 customers get food poisoning.

Sung declined to comment directly on that incident, but he said that company today has developed the “infrastructure” to scale its business across the board, and that very much includes quality control.

Grain co-founder and CEO Yi Sung Yong [Image via LinkedIn]

Grain currently delivers “thousands” of meals per day in Singapore, its sole market, with eight-figures in sales per year, he said. Last year, growth was 200 percent, Sung continued, and now is the time to look overseas. With Singha, the Grain CEO said the company has “everything we need to launch in Bangkok.”

Thailand — which Malaysia-based rival Dahamakan picked for its first expansion — is the only new launch on the table, but Sung said that could change.

“If things move faster, we’ll expand to more cities, maybe one per year,” he said. “But we need to get our brand, our food and our service right first.”

One part of that may be securing better deals for raw ingredients and food from suppliers. Grain is expanding its “hub” kitchens — outposts placed strategically around town to serve customers faster — and growing its fleet of trucks, which are retrofitted with warmers and chillers for deliveries to customers.

Grain’s journey is proof that startups in the region will go through trials and tribulations, but being able to bolt down the fundamentals and reduce burn rate is crucial in the event that things go awry. Just look to grocery startup Honestbee, also based in Singapore, for evidence of what happens when costs are allowed to pile up.

Source: Tech Crunch Startups | Singapore’s Grain, a profitable food delivery startup, pulls in M for expansion

OneDegree, an insurance technology startup based in Hong Kong, announced today it has extended its Series A round to $30 million, up from the $25.5 million it announced in September. Its extension, which the company is calling its “A2” round, was led by BitRock Capital, an investment firm that focuses on financial tech. Cyberport Macro Fund, Cathay Venture and investors from its initial Series A also participated.

The company is preparing to launch its online insurance platform, designed to make buying insurance plans easier for both consumers and providers by using data analytics to automate the most tedious parts of the process. The company will start with medical insurance for pets after its license is approved by the Hong Kong Insurance Authority before expanding into other products, including travel, cyber and human medical insurance.

In a press statement, OneDegree co-founder Alvin Kwock said its strategy is “not to compete head-on with traditional insurers, but rather to work together, steering the whole industry towards a fully digital ecosystem.”

Source: Tech Crunch Startups | Hong Kong insurance tech startup OneDegree extends its Series A to a total of million

In Riga, Latvia, an 80-person startup called Printify is reimagining the on-demand printing business.

Gone are the days where small merchants have to sell their customized products on platforms like Zazzle, Society6, CafePress or Teespring . Using Printify, e-commerce business owners can create clothes, accessories and more fixed with their designs, logos, art or photos, then sell them directly on their very own online stores.

The “first wave” of on-demand printing companies, Printify founder and chief executive officer James Berdigans explained to TechCrunch, typically require that merchants sell their items on the provider’s platforms.

“The problem is that these merchants don’t have the capability to build their own brand,” Berdigans said. “At the end of the day, you end up building the Teespring brand, not your own brand.”

Printify, a graduate of the 500 Startups accelerator, has attracted a $3 million investment from Bling Capital, a venture capital fund launched five months ago by Ben Ling, a former general partner at Khosla Ventures.

“Printify is perfectly positioned to enable the new trend of micro and boutique brands,” Ling said in a statement. “Consumers and SMBs alike can benefit from Printify’s high-quality, low-cost and fast printing platform — and create their own micro-brands.”

Founded in 2015 by Berdigans, Artis Kehris and Gatis Dukurs, Printify had previously raised a $1 million round following a big pivot. Initially, the business “pretended to be the manufacturer,” opting to be less transparent as a means to entice customers.

“That was a terrible idea,” Berdigans said. “Even though you aren’t lying, you end up not being a very honest company and that’s not the business model we wanted.”

Now, Printify operates as a B2B marketplace that connects manufacturers with e-commerce stores. Plus, the startup handles the mundane tasks of fulfilling orders, including billing, manufacturing requests and shipping so store owners can focus on brand building. The switch allowed the startup to begin growing 30% month-over-month, as well as add hundreds of unique products to its catalog.

The founders say Printify most often caters to political campaign employees, designers & artists, and influencers & “hustlers,” or people who are self-taught experts on managing digital sales. With a fixed pricing scheme, merchants know exactly what they are paying Printify, but have the flexibility of pricing their own product. Other print-on-demand marketplaces, like the aforementioned “first wave” businesses, don’t give merchants the ability to determine their own margins.

“If you use Zazzle, for example, you only get a small portion of revenue share but on Printify, you pay us a small fee,” Berdigans said. “If you were selling t-shirts for $25 and the average production cost is $10, our sellers will see a 50 to 60% margin.”

Dozens of angel investors, including YouTube co-founder Steve Chen, Twitch co-founder Kevin Lin, ClassPass co-founder Fritz Lanman, DoorDash co-founder Evan Moore, Google AdSense pioneer Gokul Rajaram and Facebook’s vice president of product Kevin Weil, also participated in the company’s latest round.

“What Airbnb did for the hospitality industry, that’s basically what we can do for the print-on-demand industry,” said Kehris, Printify’s chief operating officer.

Source: Tech Crunch Startups | Printify raises M to expand its marketplace for custom printing

Such hate. Such dismay. “How Slack is ruining work.” “Actually, Slack really sucks.” “Slack may actually be hurting your workplace productivity.” “Slack is awful.” Slack “destroys teams’ ability to think, plan & get complex work out the door.” “Slack is a terrible collaboration tool.” “Face it, Slack is ruining your life.”

Contrarian view: Slack is not inherently bad. Rather, the particular way in which you are misusing it epitomizes your company’s deeper problems. I’m the CTO of a company which uses Slack extensively, successfully, and happily — but because we’re a consultancy, I have also been the sometime member of dozens of others’ Slack workspaces, where I have witnessed all the various flavors of flaws recounted above. In my experience, those are not actually caused by Slack.

Please note that I am not saying “Slack is just a tool, you have to use it correctly.” Even if that were so, a tool which lends itself so easily to being used so badly would be a bad tool. What I’m saying is something more subtle, and far more damning: that Slack is a mirror which reflects the pathologies inherent in your workplace. The fault, dear Brutus, is not in our Slacks, but in ourselves.

Source: Tech Crunch Startups | Against the Slacklash

Existing approaches to blocking malicious advertising aren’t working — at least according to digital ad veteran Seth Demsey.

That should resonate with anyone who’s ever encountered an ad that immediately redirected them to a website filled with annoying gift card offers. And it’s the issue that the startup Demsey co-founded, clean.io, is working to address.

Today, the company is unveiling the new clean.io name (a rebrand from its old moniker of Clean Creative), and also announcing that it has raised $2.5 million in seed funding from Real Ventures.

“When you think about what we’re really dealing with, forget media, forget ads — we’re dealing with the beautiful openness of the web,” Demsey said. “That allows you to compose different elements from different people on the page, but that power of composition also opens the door to abuse.”

Hence the aforementioned ads that suddenly overwhelm you with scammy-sounding offers.

Demsey — who worked at Microsoft and Google before spending several years as CTO for TechCrunch-owner AOL’s advertising business — said companies have tried to fight back by scanning website code and by creating blacklists of bad advertisers. But the clean.io team saw that “these things were moving and changing so fast that blacklists were not effective anymore, and that scanning wasn’t effective anymore.”

Instead, Demsey said the company has created “a general-purpose system for JavaScript security that allows us to determine what should and should not be allowed to execute in JavaScript.” Put another way, clean.io provides “granular control over who gets to load JavaScript.”

As a simple example, if clean.io detects JavaScript that redirects your browser, it can check to see who’s actually calling for the redirect — if it’s the publisher whose page you’re on, then that’s probably fine. But, Demsey said, if it’s “some random JavaScript CDN,” then clean.io will say, “Let’s block this one.”

CEO Matt Gillis (also a former AOL ad exec) added that clean.io’s approach is particularly tough on the sources of malicious advertising, which he described as “the most sophisticated performance advertisers on the planet.” That’s because the startup’s technology doesn’t simply block the ad. Instead, it runs the ad and blocks the bad JavaScript, which means the advertiser pays for the impression without getting results.

“We make it unprofitable for the bad actors,” Gillis said. “Most of the others who are scanning or URL blocking are not really eliminating [the bad behavior], they’re just playing the game of cat and mouse.”

As for why the company changed its name, Demsey suggested that clean.io could eventually apply this technology in areas beyond advertising.

“The name change is to really signify the fact that our ambitions and our technology are broader than merely cleaning up the ad ecosystem,” he said.

Source: Tech Crunch Startups | Clean.io raises .5M to fight malicious advertising

Docpack is offering businesses a simple way to share their documents — particularly with customers at large enterprises that may block services like Dropbox or Google Drive.

Founder and CEO Rurik Bradbury said he encountered this issue while serving as the head of conversational strategy at LivePerson (he’s also been an executive and/or co-founder at Trustev and Unison Technologies, and he operates the beloved Prof Jeff Jarvis parody account). Many of the largest companies that LivePerson was working with just wouldn’t accept file-sharing links, so “we had to print out things and FedEx things” — and in at least one case, ship Android tablets pre-loaded with documents.

Apparently this is a broader issue, with research suggesting that services like Box, Dropbox and Google Drive remain among the most blacklisted apps by enterprise IT departments.

In particular, Bradbury said companies are worried about “full, two-way file sharing,” so he found a way around it by “building these microsites for each company,” where someone could download documents. From the IT perspective, they are just regular websites, with no capabilities for employees to share documents back, so they stayed off the blacklists.

The problem with microsites, however, is that they’re “not scalable.” So with Docpack, Bradbury aims to make it quick and easy to create them for a wide range of clients. He compared his approach to website builders like Wix and Squarespace, “Where you can make a website even if you’re not technical.”

Similarly, it should only take Docpack users a few clicks to create a new microsite, add customized branding and upload documents. These documents can be protected with security that limits access to users with a specific company email domain, and the publisher can also track which documents are actually getting downloaded.

Docpack has raised less than $500,000 in funding from Asian accelerator Zeroth, Trustev founder Pat Phelan and other individuals.

The startup’s standard plan costs $10 per seat. Bradbury suggested that the service could be useful across sales, business development and marketing: “There’s a huge amount of business transacted via document-sharing.” He also suggested that PR professionals and journalists could use it to share documents, and he’s offering free accounts for credentialed journalists.

As for competition from the big file-sharing services, Bradbury suggested that as they try to accommodate enterprise needs, they’re creating “a product that’s stretched out, that was not really designed at all for cross-company sharing.”

“This is a big enough space … that it deserves its own thing,” he added.

Source: Tech Crunch Startups | Docpack offers a simple, enterprise-friendly way to share documents

Base coined the term “blanding,” but the international branding agency is anything but boring. With clients ranging from AI startup Rival Theory to e-commerce company Kidbox, Base leverages its broad portfolio of clients and designers from all around the world to help startups develop their individual personas. As they celebrate their 20th anniversary this year, we talked to Base Partner Geoff Cook about how the agency continues to evolve.

On Base’s culture:

“Base strives to have a profound cultural impact. Yes, we do strategy, and yes, we do identity, and all sorts of brand executions, but the end goal is to have a significant cultural impact for our clients. The end goal isn’t the product, it’s the result.”

On common founder mistakes:

“This may sound provocative, but I think the most common mistake is that there is a belief in the tech world that branding should be approached iteratively like their approach to product development. Having now been through that process of iteration with both startups and the largest tech companies, we’ve found that the results are often compromised. Oftentimes if you iterate or have different groups weighing in throughout the process, it can be detrimental to the end result. It’s a conversation we’re now having with founders to say, “We’ve tried both ways, we’ve seen these results, and we would ask that you go along for the ride and put your trust in us, and we’ll ensure that you will arrive someplace really compelling.”

Below, you’ll find the rest of the founder reviews, the full interview, and more details like pricing and fee structures. This profile is part of our ongoing series covering startup brand designers and agencies with whom founders love to work, based on this survey and our own research. The survey is open indefinitely, so please fill it out if you haven’t already.

Interview with Base Partner Geoff Cook

Yvonne Leow: To kick things off, could you tell me about your backstory? How did you get into branding?

Geoff Cook: I actually came from DKNY, back in its heyday, and met Base’s Belgian partners through the world of fashion. I always joke that I wanted out of fashion and they wanted out of Brussels. So I invested in Base and brought it to New York City in 1999. My background is in marketing and strategy. When I was leading the International Menswear division at DKNY, I started realizing that I always had the most fun working with our internal branding group. So, when I left, I knew I wanted to pivot and go more in that direction. I think what appealed to me was the combination of creativity and the massive impact branding could have on the world. The intersection of those two things really drew me in.

Source: Tech Crunch Startups | Verified Expert Brand Designer: Base

The constant refrain in the tech world is that the world is about to be rocked by the combination of AI and robots. Therefore you’d think that startups that build either AI or robots would be onto a winner. However, there’s a serious misunderstanding going on.

What is becoming clear is that the closer companies are to actual robotics, the only way to compete will be in genuinely transformational hardware. The era where a robotic arm was considered innovative is long over.

Similarly, robotics as a sector won’t go anywhere without being married to powerful machine learning and visual systems.

Thus it is that startups that can do both AI and blend this with robotics, which might be either off the shelf robotic arms or tools, will position themselves far higher up the valuation stack.

So it’s significant that U.K.-based startup Karakuri has “opened the kimono” on its plans to do just that.

Karakuri uses a combination of robotics, machine learning, optics and sensors to deliver a robot that will make personalized, freshly prepared, high-quality meals. The advantage is that the robot can make something that matches exactly what the customer wants (no nuts and seed for instance, just this amount of dressing, etc.) and the result can also minimize food waste.

The startup comes at the right time. Research shows that almost two-thirds of consumers globally now follow a diet that limits or prohibits the consumption of some foods or ingredients due to food intolerance, as well as following a specific weight loss diet.

Karakuri’s technologies also allow restaurants to move away from mass pre-packaged meals and significantly reduce food waste.

Karakuri has now raised a £7 million seed investment, led by Ocado. The fundraise includes investments from Hoxton Ventures, firstminute Capital and Taylor Brothers, and will be used to further develop the company’s technology, strengthen its IP base and expand its team for global growth.

For Ocado, the investment means it can expand its value proposition in grocery, especially through Ocado Zoom, its new delivery arm.

Karakuri CEO and co-founder, Barney Wragg, says, “Consumer eating habits in and out of the home are changing rapidly as demand increases for healthier options that match specific dietary requirements. This growth in menu personalization is putting huge pressure on restaurants, cafes and other food retailers. These providers have historically relied on identically mass-produced meals to maintain their profit margins. By using robotics and machine learning, Karakuri’s systems provide localized micro-manufacturing within an existing restaurant, retail or commercial kitchen. Our systems prepare personalized meals onsite in real time to the exact requirements of each customer.”

Brent Hoberman, Karakuri’s founding chairman, co-founder of Founders Factory and general partner at firstminute Capital, says: “The time is now for robotics and AI to drive change in the restaurant and food services business. Barney and Simon have assembled a world-class team to go after one of the next large markets to be enhanced by this technology. We are delighted that Ocado, a global leader in robotics and distribution, has chosen to invest in Karakuri to lead the innovation in this sector.”

Hoberman says startups like Karakuri are going to become more significant as we reach the tipping point where manual workers are becoming less and less available to do the kinds of work that used to be done in restaurants.

Karakuri emerged out of the Founders Factory incubator, but the backstory to this startup is significant. Its advisory board includes industry experts from ARM, Ocado, Imperial College, Bristol Robotics Lab and Edinburgh Centre for Robotic.

Bristol Robotics Lab, in particular, has generated a world-class reputation for its robotics accelerator.

Source: Tech Crunch Startups | Robotics startups won’t win without also incorporating AI, as Karakuri’s fundraise shows