Tech Blog - Page 576 of 2385 - 1010Computers | Computer Repair & IT Support1010Computers

Mastercard acquires security assessment startup, RiskRecon

Published December 23, 2019

Mastercard announced today that it is acquiring RiskRecon, a Salt Lake City startup that uses publicly available data to build security assessments of organizations. The companies did not share the purchase price.

It has become increasingly important for financial services companies like Mastercard to help customers navigate cybersecurity, and RiskRecon will give customers an objective score of a company’s risk profile.

“Through a powerful combination of AI and data-driven advanced technology, RiskRecon offers an exciting opportunity to complement our existing strategy and technology to secure the cyber space,” Ajay Bhalla, president of cyber and intelligence for Mastercard, said in a statement.

RiskRecon CEO Kelly White told TechCrunch in a 2016 interview after the company’s $3 million seed round that the company looks at information that is readily available on the internet and puts it together to measure a company’s overall security risk:

RiskRecon leverages information that is available on the web from companies operating there as part of the act of doing business. “If you stand up web servers and DNS servers, these are intentionally discoverable because they are providing services on the internet. Systems reveal the software being run and version information from which you can determine security performance.”

White sees joining Mastercard as an opportunity to be a part of a larger organization and all that that entails. “By becoming part of their team, we have an opportunity to scale our solution and help companies in new industries and geographies take steps to better manage their cybersecurity risk,” he said in a statement.

RiskRecon launched in 2015 and has raised $40 million, according to Crunchbase data. Investors included Accel, Dell Technologies Capital, General Catalyst and F-Prime Capital.

It’s worth noting that the company was not alone in the space, competing with New York City-based SecurityScoreCard, which launched in 2013 and has raised over $112 million, according to Crunchbase. The last investment came in June for $50 million.

Today’s deal is subject to standard regulatory approval, but is expected to close in the first quarter in 2020.

RiskRecon scores $3 million seed round to provide objective cloud vendor security assessments

Eddy Travels closes pre-seed round led by Techstars to scale its AI travel assistant

Published December 23, 2019

Eddy Travels, an AI-powered travel assistant bot which can understand text and voice messages, has closed a pre-seed round of around $500,000 led by Techstars Toronto, Practica Capital and Open Circle Capital VC funds from Lithuania, with angel investors from the U.S., Canada, U.K.

Launched in November 2018, Eddy Travels claims to have more than 100,000 users worldwide.

Travelers can send voice and text messages to the Eddy Travels bot and get personalized suggestions for the best flights. Because of this ease of use, it now gets 40,000 flight searches per month — tiny compared to the major travels portals, but not bad for a bot that is available on Facebook Messenger, WhatsApp, Telegram, Rakuten Viber, Line and Slack chat apps.

The team is now looking to expand into accommodation, car rentals and other travel services. Eddy Travels search is powered by partnerships with Skyscanner and Emirates Airline.

The founders are from Lithuania: Edmundas Balcikonis, CEO, (previously founded and led as CEO TrackDuck startup, acquired by Invision), Pranas Kiziela and Adomas Baltagalvis. The company HQ is in Toronto, Canada.

India’s HomeLane raises $30M to expand its one-stop shop for interior design

Published December 23, 2019

HomeLane, a Bangalore-based startup that helps people manage home renovations and interior design, today announced it has raised $30 million in a new financing round as it looks to expand its proprietary technology.

The financing round, dubbed Series D, was led by Evolvence India Fund (EIF), Pidilite Group and FJ Labs. Existing investors Accel Partners, Sequoia Capital and JSW Ventures also participated in the round, which pushes the five-year-old startup’s all-time raise to $46 million.

HomeLane helps property owners furnish and install fixtures in their new apartments and houses. Interior designers need to be local to customers and supply chain partners need to have the capacity to ship to a location. So HomeLane has established 16 experience centers in seven Indian cities so consumers can touch and see materials and furniture.

The startup plans to use the fresh capital to broaden its technology infrastructure and expand to eight to 10 additional cities.

HomeLane competes with other online furniture sellers such as Livspace and Urban Ladder, as well as brick-and-mortar stores. Founders Rama Harinath and Srikanth Iyer say their startup differentiates by offering a one-stop shop — it sells everything from fitted kitchens and wardrobes to entertainment units and shoe racks — and by providing guaranteed on-time delivery and after-sale services to help homeowners finish projects.

The site allows property owners to upload floor plans, which are reviewed by interior designers who provide product suggestions, price quotes and 3D pictures of how furnishings and fixtures will look after they are installed. The startup, which has worked with more than 900 design experts to deliver over 6,000 projects, pays to the designers a fraction of the money it charges customers.

Iyer, who serves as the chief executive of HomeLane, claimed that the startup is inching closer to being EBIDTA profitable (which does not include taxes and a range of other expenses). That would be a notable turnaround for HomeLane, which reported a net loss of $4.1 million on revenue of $5.6 million in the financial year that ended in March 2018.

Prashanth Prakash, a partner at Accel India, said, “We are very happy with HomeLane’s current growth trajectory and are believers in the long-term growth prospects of the home improvement consumer segment in India.”

Luminance and Omnius are bringing AI to legacy industries

Published December 21, 2019

Artificial intelligence is a powerful tool, but it’s not a magic wand. Applying the technology requires thought and dedication, especially with legacy industries like law and insurance, which are being taken on in this way by Luminance and Omnius respectively. The companies’ founders, Emily Foges and Sofie Quidenus-Wahlforss, spoke with great insight on this on stage at Disrupt Berlin.

Luminance uses AI and natural language processing to help law firms process documents more quickly, not replacing the lawyer but providing additional intelligence and analysis of what may be hundreds or thousands of pages and saving time and money. Omnius applies AI not just to the text of insurance claims, but to the process of handling them, ensuring rapidity not only in documentation but in results like payouts.

Omnius has raised about $30 million in multiple small rounds and grants, while Luminance has raised some $23M mainly in its A and B rounds.

I’ve edited and contextualized our conversation here, but you can also watch the full panel below. I’ve made some slight changes for readability but left things mostly intact. Pull quotes belonging to Emily are on the left, Sofie’s are on the right.

The first thing I wanted to hear from the founders was why they chose these industries, and why now? After all, law and insurance are notoriously old-fashioned, some would even say backwards in many ways. How could they be sure this was an opportunity, and not a folly?

Emily Foges (Luminance): It had more to do with the capabilities of the technology, actually. We started with technology that can read a lot of language, and then we looked at what industry would benefit most from that. It was that way around.

I think the timing is 80 percent of the battle; The fact that the legal profession had got to a point of being ready to accept the use of that kind of technology was more luck than anything. But there’s been such an explosion in enterprise data that lawyers just can’t possibly cope with reading and all of the documentation that they need to — so the market was ready.

Sofie Quidenus-Wahlforss (Omnius): I think we come from a very similar background. We started on a horizontal level, with deep document understanding, and at some point we understood, if you really want to ship business value, you need to dive into one vertical.

We have different verticals to choose: manufacturing, legal, pharma… so then we were like, okay, which area is the biggest that is not transformed yet? And do we see decision makers aware of the of the need to do something? And do they have money?

The insuretech world is of course making a lot of pressure, all the new insurance companies like Lemonade, WeFox, Coya, because they claim to settle a claim in minutes. So the big guys like Alliance, they got nervous. And on the other hand you see, on the technology side, improvements in the areas of computing power, way more access to data, more flexible models. So we thought, the industry is ready, the technology’s ready, I was ready to build a big company. It’s my fourth company and I was like, this time I’ll build something huge. So everything fell into place.

They don’t call them legacy industries for nothing, though. These domains, and some companies, that have existed for decades or even a century or more. That means legacy systems and legacy people, to put it kindly, that may not be amenable to change. Emily had some surprising stats on that, while Sofie advocated an AI-like approach to classifying and selecting clients.

Emily: Some of them are more ready than others, and I think the ones who aren’t ready need to really catch up, because we got to critical mass really quickly. We’re only three and a half years old, but we’ve got 185 law firms around the world signed up. The interesting thing was the most ready people were the law firms outside of the UK, outside of the US. It was European law firms, APAC-based law firms, South and Central American law firms who got on board first. They were more ready because to be honest, the commercial pressure was greater. And then the pressure on the US and UK law firms came from them.

This is something I can really recommend for every startup trying to transform an industry from scratch: classifying your customers. We had 16-17 criteria, how we defined the companies we really want to spend time with.

Sofie: We thought, cool, the transformation is happening already. But after a while, 2018, we were like, okay, this market is not moving as fast as we thought . We looked at our proof of concept, our pilots we did with insurance companies and were like, wow, every big insurance company in Europe wants to have an AI pilot project but who’s really ready to start with AI full production?

And this is something I can really recommend for every startup trying to transform an industry from scratch: classifying your customers. Who is a laggard, who is an early adopter, who is early mainstream, is an innovator? Then we decided together with the board, okay, we’ll only focus on innovators and early adopters, and the rest should wait, or we can both wait for each other — but we cannot waste our time.

Should you pay $50K for your pitch deck? Yes, why the hell not?

Published December 21, 2019

Every once in a while on VC Twitter, a comment or statement seems so outlandish, so completely outrageous, that it must be — certainly has to be — false. Such as it was for Primary Ventures investor Jason Shuman, who commented on the recent prices for pitch deck advice in the Valley today:

Founder friend just told me that SF deck designers have quoted him between $20K to $40K + the right to invest up to $250K…my mind is officially blown

— Jason Shuman (@BoatShuman) December 20, 2019

You can almost hear that plaintive scream, “My mind is officially blown” (Shuman doesn’t scream, mind you). And indeed, in a world where more and more founders are worried about a bubble; assets are more, let’s say, Notionally expensive than ever before; and everything just seems a little bit crazy these days, it seems downright, fucking insane to think that a PowerPoint file and some “thoughts” are worth tens of thousands of dollars, and a goddamn term sheet to boot.

But they are.

Or at the very least, they can be. And I say that as the guy who wrote an article last week entitled, “How to avoid the startup trap of the parasitic consultant.”

How to avoid the startup trap of the parasitic consultant

For sure, not every pitch deck consultant is worth top dollar, any more than not every croissant in New York’s West Village is worth $10. But some are, and certainly an elect chosen set of consultants are worth every penny they demand.

The best consultants are not luxuries to plaster on your WeWork’s walls, but critical tools to invest in your startup. Framing a startup’s thesis, product, team, and market exactly right is a qualitative skill that can’t be learned from reading a book or scanning through a founder friend’s deck or two. Get a single slide wrong, or hell, a single bullet point wrong and the whole thing can blow up in a pitch meeting in thirty seconds or less.

Trust me. As a former VC investor, I have gotten hung up on single sentences before. A founder has put their life’s work into a company, synoptically condensed it to a handful of slides, and I am stuck on eight words. But those eight words make no sense, and once something doesn’t make sense, the whole edifice of excitement and confidence comes crashing down. Eight words — one badly chosen verb and adjective.

A good pitch deck consultant may barely move the needle on a fundraise, while a superstar may not just get you a better term sheet, they may fundamentally transform the entire course of your startup’s trajectory. Those are the stakes.

And of course, it’s not just pitch deck consultants who can do this. The right PR consultants can potentially get you traction that no one else can. The right sales consultants may lock in those critical early design customers that represent the difference between an orderly liquidation and a massive Series A. The right product marketing specialists or pricing experts may be what drives conversions and eliminates churn.

What’s so hard today for founders is that the Valley has indeed matured, and all these consultants and more are available. There are the hucksters and the tricksters, the bon vivants thriving on naive capital, the idiot clowns cloaked in their own compelling pitch decks.

But as the market has expanded for these services, at least some superstars are emerging from the marketplace, people who can offer more value for you in a week or two than the mediocrities can in a year.

Your job as founder is to constantly probe and find those diamonds, and get them working on your idea at any cost — even costs that might at times seem insane.

The thing with tech startups today is that they are built upon strata of superstardom. Superstar talents lead to superstar products, superstar VC capital, and ultimately, superstar exits. Superstar momentum is real. Yes, yes, yes, not every time, and every stage in the pipeline is multiplied by a stochastic chance of failure, for sure. But idiocy has rarely been a path to success.

And so as with all parts of innovation, it’s all about making the right investments in the right people and the right ideas. $50K or even $500K for a consultant won’t do anything if they are the wrong person working on the wrong idea — parasites are parasites after all. But leverage that early seed capital into the right people working on the right problems, and that’s where the magic happens.

And so I can understand some of the outrage over these figures, as well as the lingering presumption behind them that VCs care more about a startup’s deck than the underlying startup itself. Those frustrations are palpable and not insane, but let’s not avoid the tough question: everything has some value attached to it. It shouldn’t surprise anyone that top experts in their fields, who understand their own leverage, would take advantage of their expertise and drive their own prices higher.

Paying tens of thousands of dollars for a pitch deck consultant isn’t a prerequisite for securing a venture capital round. There are founders whose entire skill is securing capital for their companies who have never paid a penny for this skill.

Yet ultimately, all early-stage startups face the same challenge: too many activities, too little time. Something, somewhere is going to have to get outsourced today and the quality of that external work is largely going to be determined by how much you are willing to pay for it. What you choose to spend whatever capital you have will determine the trajectory of your startup. So whether it is pitch decks or another activity, never blink from those top dollars. It may very well be what gets you the top dollar in the end.

TikTok’s national security scrutiny tightens as U.S. Navy reportedly bans popular social app

Published December 21, 2019

TikTok may be the fastest-growing social network in the history of the internet, but it is also quickly becoming the fastest-growing security threat and thorn in the side of U.S. China hawks.

The latest, according to a notice published by the U.S. Navy this past week and reported on by Reuters and the South China Morning Post, is that TikTok will no longer be allowed to be installed on service members’ devices, or they may face expulsion from the military service’s intranet.

It’s just the latest example of the challenges facing the extremely popular app. Recently, Congress led by Missouri senator Josh Hawley demanded a national security review of TikTok and its Sequoia-backed parent company ByteDance, along with other tech companies that may share data with foreign governments like China. Concerns over the leaking of confidential communications recently led the U.S. government to demand the unwinding of the acquisition of gay social network app Grindr from its Chinese owner Beijing Kunlun.

The intensity of criticism on both sides of the Pacific has made it increasingly challenging to manage tech companies across the divide. As I recently discussed here on TechCrunch, Shutterstock has actively made it harder and harder to find photos deemed controversial by the Chinese government on its stock photography platform, a play to avoid losing a critical source of revenue.

In wake of Shutterstock’s Chinese censorship, American companies need to relearn American values

We saw similar challenges with Google and its Project Dragonfly China-focused search engine as well as with the NBA.

From the NBA to Sequoia to TikTok and more, a week of national security concerns with China

What’s interesting here though is that companies on both sides are struggling with policy on both sides. Chinese companies like ByteDance are increasingly being targeted and stricken out of the U.S. market, while American companies have long struggled to get a foothold in the Middle Kingdom. That might be a more equal playing field than it has been in the past, but it is certainly a less free market than it could be.

While the trade fight between China and the U.S. continues, the damage will continue to fall on companies that fail to draw within the lines set by policymakers in both countries. Whether any tech company can bridge that divide in the future unfortunately remains to be seen.

2019’s 10 defining moments in venture capital

Published December 20, 2019

Every year, the tech industry experiences moments that serve as guideposts for future entrepreneurs and investors looking to profit from the wisdom of the past.

In 2017, Susan Fowler published her heroic blog post criticizing Uber for its culture of sexual harassment, helping spark the #MeToo movement within the tech industry; 2018 was the year of the scooter, in which venture capitalists raced to pour buckets of cash into startups like Bird, Lime and Spin, hoping consumer adoption of micro-mobility would make the rushed deals worth it.

These last twelve months have been replete with scandals, new and interesting upstarts, fallen CEOs and big fundraises. Theranos founder Elizabeth Holmes finally got a court date, SoftBank’s Masayoshi Son admitted defeat (see: “In the case of WeWork, I made a mistake”), venture capitalist Bill Gurley advocated for direct listings and denounced big banks’ underwriting skills, sperm storage startups battled for funding and Away’s dirty laundry was aired in an investigation conducted by The Verge.

The list of top moments and over-arching trends that defined this year is long. Below, I’ve noted what I think best represent the largest conversations that occurred in Silicon Valley this year, with a particular focus on venture capital, followed by honorable mentions. As always, you can email me (kate.clark@techcrunch.com) if you have thoughts, opposing opinions, strong feelings or relevant anecdotes.

SoftBank Group Corp. chairman and CEO Masayoshi Son speaks during a press conference on November 6, 2019 in Tokyo, Japan. (Photo by Alessandro Di Ciommo/NurPhoto via Getty Images)

1. SoftBank admitted failure: We’ll get to WeWork in a moment, but first, let’s talk about its multi-billion-dollar backer. SoftBank announced its Vision Fund in 2016, holding its first major close a year later. Ultimately, the Japanese telecom giant raised roughly $100 billion to invest in technology startups across the globe, upending the venture capital model entirely with its ability to write $500 million checks at the flip of a switch. It was an ambitious plan and many were skeptical; as it turns out, that model doesn’t work too well. Not only has WeWork struggled despite billions in funding from SoftBank, several other of the firm’s bets have wavered under pressure. Most recently, SoftBank confirmed it was selling its stake in Wag, the dog-walking business back to the company, nearly two years after funneling a whopping $300 million in the then-three-year-old startup. Wag failed to accumulate value and was struck by scandal, leading to SoftBank’s exit. Why it matters: ditching one of its more high profile bets out of the monstrous Vision Fund wasn’t even the first time this year SoftBank admitted defeat. Once an unstoppable giant, SoftBank has been forced to return to reality after years of prolific dealmaking. No longer a leader in VC or even a threat to other top venture capitalists, SoftBank’s deal activity has become a cautionary tale. Here’s more on SoftBank’s other uncertain bets.

2. WeWork pulled its IPO. The biggest story of 2019 was WeWork. Another SoftBank portfolio, in fact the former star of its portfolio, WeWork filed to go public in 2019 and gave everyone full access to its financials in its IPO prospectus. In August, the business disclosed revenue of about $1.5 billion in the six months ending June 30 on losses of $905 million. The IPO was poised to become the second-largest offering of the year behind only Uber, but what happened instead was much different: WeWork scrapped its IPO after ousting its founding CEO Adam Neumann, whose eccentric personality, expensive habits, alleged drug use, desire to become Israel’s prime minister and other aspirations led to his well-publicized ouster. There’s a lot more to this story, click here for more coverage of the 2019 WeWork saga. Why it matters: WeWork’s unforgiving IPO prospectus painted a picture of a high-spending company with no path to profit in sight. For years, Silicon Valley (or New York, where WeWork is headquartered) has allowed high-growth companies to raise larger and larger rounds of venture capital, understanding that eventually their revenues would outgrow their expenses and they would achieve profitability. WeWork, however, and its fellow ‘unicorn,’ Uber, made it all the way to IPO without carving out a strategy of reaching profitability. These IPOs ignited a wide-reaching debate in the tech industry: does Wall Street care about profitability? Should startups prioritize profits? Many said yes. Meanwhile, the threat of a downturn had startups across industries cutting back and putting cash aside for a rainy day. For the first time in years, and as The New York Times put it, Silicon Valley began trying out a new mantra: make a profit.

3. A whole bunch of CEOs stepped down: Adam Neumann wasn’t the only high profile CEO to move on from their company this year. In a move tied to The Verge’s investigation, Away co-founder and CEO Steph Korey stepped down from the luggage company, instead becoming its executive chairman. Lime’s CEO Toby Sun stepped down, shifting to another role within the company. On the public end of the ecosystem, McDonald’s, REI, Rite Aid and many others replaced their leaders. According to CNBC, nearly 150 CEOs left their post in November alone, setting up 2019 to break records for CEO departures with nearly 1,500 recorded already. Why it matters: All of these departures were caused by varying factors. I will focus on WeWork and Away, which took center stage of the startups and venture capital universe. The recent Away debacle reinforces the role of the tech media and its ability to present well-reported facts to the public and enact significant change to business as a result. Similarly, much of Adam Neumann’s ouster came as a result of strong reporting from outlets like The Wall Street Journal, Bloomberg and more. From facilitating a toxic, cutthroat culture to paying millions in company dollars for an unnecessary private jet, Away and WeWork’s situations proved standards for startup CEOs has shifted. Whether that shift is here to stay is still up for debate.

Ah the list we’ve all been waiting for. pic.twitter.com/PndSjQf8yt

— Kate Clark (@KateClarkTweets) December 3, 2019

4. The IPO market was unforgiving to unicorns: WeWork never made it to the stock markets, but Uber, another scandal-ridden unicorn, did. The company (NYSE: UBER), previously valued at $72 billion, priced its stock at $45 apiece in May for a valuation of $82.4 billion. It began trading at $42 apiece, only to close even lower at $41.57, or down 7.6% from its IPO price. Not stellar, in fact, quite bad for one of the largest venture-backed companies of all time. Uber, however, wasn’t the only one to struggle with its IPO and first few months on the stock market. Other companies like Lyft and Peloton had disappointing results this year confirming the damage inflated valuations can cause startups-turned-public companies. Though a rocky IPO doesn’t mark the end of a company, it does tell you a lot about Wall Street’s appetite for Silicon Valley’s top companies. Why it matters: 2019’s tech IPOs illustrated a disconnect between the public markets and venture capitalists, whose cash determines the value of these high-flying companies. Wall Street has realized these stocks, which NYT journalist Erin Griffith recently described as “Publicly Listed Unicorns Miserably Performing,” are far less magical than previously assumed. As a result, many companies, particularly consumer tech businesses, may delay planned offerings, waiting until the markets stabilize and become hungry again for big-dreaming tech companies.

Hardware IPOs continue to struggle

Published December 20, 2019

Now that the final technology IPOs of 2019 have touched down, it’s a good time to start looking back at what happened during the year. We’re hunting for trends as the clock winds down. Here’s one that’s obvious: Hardware startups are still struggling.

It’s cliché to note in startupland that hardware is hard. Everyone knows it. Making hardware is difficult by itself, but as all tech hardware requires software, hardware shops wind up needing wider domain expertise than pure-software startups. And that’s hard.

But even if a nuts-and-bolts tech company hits scale, it seems difficult to keep that momentum up.

This year we saw Peloton, a hybrid hardware and digital services company, go public and struggle. Despite a recent public market resurgence, the company is slipping back toward its IPO price. Today its equity is trading down about 6% to around $30 per share. The company’s IPO price of $29 is uncomfortably close to its current value.

2019’s IPO crop also included EHang, a late entry to the market (more here on its debut) that quickly began to lose altitude after it started to float. EHang traded up today, but the firm is still worth less than its IPO valuation, a reduced figure that was dinged during the China-based drone company’s march toward the public markets.

So, Peloton is about flat and EHang is down. That’s not a great mix of results for a year’s IPO class of hardware companies. Looking back in time, things don’t get much better.

NIO, a China-based electric car company (despite making this thing of beauty), has deleted about two-thirds of its value since its late-2018 U.S.-listed IPO. After going public at $6.25, shares of NIO are worth just $2.70 today.

Sonos also went public in the United States in 2018. It traded above its IPO price of $15 at first. Then it fell under $10 per share as 2018 came to a close. The smart speaker and stereo company spent 2019 recovering. It’s now worth its IPO price again, closing trading today worth about $14.80 per share.

If you go back to 2017, however, Roku has kicked ass. After pricing at $14 per share, the TV hardware and digital services firm is trading for $137 per share, a nearly 10x gain. But Roku was moving away from hardware at the time of its IPO, making it a somewhat poor example. Hardware revenues for Roku were just 31% of revenue in its most recent quarter, for example. That figure was 42% in the year-ago quarter. It will continue to fall.

We don’t need to go over what happened to Fitbit and GoPro, I don’t think.

Hardware can make a lot of money. Samsung and Apple make oceans of money from their hardware. Microsoft has managed to make Surface into a real business, with billions of dollars in yearly revenue. Amazon has a big hardware business with both consumer reading gadgets and consumer surveillance devices. Even Google is taking its new phone seriously enough to buy out a chunk of the NBA’s ad slots (I think it’s this one), according to my extensive in-market testing. Facebook is the laggard of the group.

But for smaller hardware companies going public, unless I’m missing a number of recent of IPOs — and I don’t think that I am — it’s a tough world out there.

F5 acquires Shape Security for $1B

Published December 20, 2019

F5 got an expensive holiday present today, snagging startup Shape Security for approximately $1 billion.

What the networking company gets with a shiny red ribbon is a security product that helps stop automated attacks like credential stuffing. In an article earlier this year, Shape CTO Shuman Ghosemajumder explained what the company does:

We’re an enterprise-focused company that protects the majority of large U.S. banks, the majority of the largest airlines, similar kinds of profiles with major retailers, hotel chains, government agencies and so on. We specifically protect them against automated fraud and abuse on their consumer-facing applications — their websites and their mobile apps.

F5 president and CEO François Locoh-Donou sees a way to protect his customers in a comprehensive way. “With Shape, we will deliver end-to-end application protection, which means revenue generating, brand-anchoring applications are protected from the point at which they are created through to the point where consumers interact with them—from code to customer,” Locoh-Donou said in a statement.

As for Shape, CEO Derek Smith said that it wasn’t a huge coincidence that F5 was the buyer, given his company was seeing F5 consistently in its customers. Now they can work together as a single platform.

Shape launched in 2011 and raised $183 million, according to Crunchbase data. Investors included Kleiner Perkins, Tomorrow Partners, Norwest Venture Partners, Baseline Ventures and C5 Capital. In its most recent round in September, the company raised $51 million on a valuation of $1 billion.

F5 has been in a spending mood this year. It also acquired NGINX in March for $670 million. NGINX is the commercial company behind the open-source web server of the same name. It’s worth noting that prior to that, F5 had not made an acquisition since 2014.

It was a big year in security M&A. Consider that in June, four security companies sold in one three-day period. That included Insight Partners buying Recorded Future for $780 million and FireEye buying Verodin for $250 million. Palo Alto Networks bought two companies in the period: Twistlock for $400 million and PureSec for between $60 and $70 million.

This deal is expected to close in mid-2020, and is of course, subject to standard regulatory approval. Upon closing Shape’s Smith will join the F5 management team and Shape employees will be folded into F5. The company will remain in its Santa Clara headquarters.

Shape Security hits $1B valuation with $51M Series F

Centaurs, centurions, centipedes: the $100M ARR CLUB

Published December 20, 2019

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

This week Kate was in SF, Alex was in Providence and there was a mountain of news to shovel through. If you’re here because we mentioned linking to a certain story in the show notes, that’s here. For everyone else, let’s get into the agenda.

We kicked off with a look at three new venture funds. In order:

Tusk Ventures: Tusk’s new fund, worth $70 million, is an effective doubling of its prior fund’s $36 million size. The politically savvy firm has put money into Coinbase, and other companies that deal with regulated industries.
Sapphire Ventures: SAP’s former corporate venture fund Sapphire Ventures announced a whopping $1.4 billion fundraise this week. Sapphire may be one of or the most successful CVC spinouts to date.
Moxxie: Katie Jacobs Stanton, known for co-founding #ANGELS, just closed her debut fund on $25 million. Kate chatted with her about her experience fundraising her very own fund, some of her previous investment and her plans for Moxxie Ventures, so there was plenty to unpack here.

From there we turned to the gender imbalance in the world of venture capital. This year, companies founded by women raised only 2.8% of capital. These not-so-stellar statistics are always worth digging into.

We then took a quick look at two different venture rounds, including ProdPerfect’s $13 million Series A and Pepper’s smaller $5.6 million round. ProdPerfect’s round was led by Anthos Capital (known for investing in Honey, which sold for $4 billion). The company has $2 million in ARR and is growing quickly. Pepper, formed by former Snap denizens, is working to help other startups lower their CAC costs in-channel. Smart.

And finally, Alex wanted to bring up his series on startups that reach the $100 million ARR threshold (Extra Crunch membership required). A first piece looking into the idea led to a few more submissions. There seem to be enough companies to name the grouping with something nice. Centurion? Centipede? Centaur? We’re working on it.

Equity drops every Friday at 6:00 am PT, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.