Fundings & Exits
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Cookware startup Great Jones raises $1.75M as it expands into bakeware
Great Jones is expanding into a new area of the kitchen tomorrow, with what co-founder and CEO Sierra Tishgart described as the startup’s biggest launch since it released its first products two years ago.
Ahead of launching the new bakeware line, Great Jones is announcing that it has raised $1.75 million in new funding.
The money comes from notable figures in the e-commerce world — Fellow founder Jake Miller and Very Great founders Eric Prum and Josh Williams — along with restauranteurs including Mimi Cheng’s co-founder Hannah Cheng, Lilia founder Sean Feeny, Kopitiam co-owner Moonlynn Tsai and Konbi co-owner Akira Akuto.
NEA partner Liza Landsman invested as well, and Tishgart said that Sweetgreen’s Nic Jammet and Parachute’s Ariel Kaye have joined the startup’s board of directors. Tishgart noted that Great Jones has worked on collaborations and product partnerships with many of these investors, and she also pointed to Kaye and Parachute as providing a model for how Great Jones can grow.
“To me, starting with sheets, [Kaye] has taken a product which people loved and thoughtfully expanded to a broad selection,” Tishgart said.
She sees a similar path for Great Jones — just as Parachute has become a “one-stop shop” for the home, Tishgart wants her startup to do the same for your kitchen. Great Jones launched with pots, pans and a Dutch oven, then added a baking sheet and is now expanding into a whole line of bakeware.
Image Credits: Great Jones
The new bakeware products (many of them inspired by classic Pyrex designs) include the Sweetie Pie ceramic pie dish, the Hot Dish ceramic casserole dish, the Breadwinner loaf pan, the Patty Cake cake pan and a new broccoli-colored version of the Holy Sheet baking sheet. You can buy the pieces à la carte (the Holy Sheet is $35, the pie pans are $45 and the bread pans are $65 for a pair) or purchase the whole set for $245.
Tishgart added that the company has had a “really, really busy year” with lockdowns and social distancing.
“People are cooking more than ever,” she said. “This is a category and an industry that have really been able to thrive on this.”
At the same time, Tishgart emphasized that the growing interest from millennials and younger consumers is a long-term trend that won’t go away when the pandemic is over — with the rise of celebrity chefs, high-profile restaurants and more food content than ever, food and cooking have become a bigger “cultural force” than ever.
There have been challenges as well, particularly as the pandemic has affected supply chains. Tishgart said the company has spent much of the year “chasing product,” but it benefited from using a variety of materials and working with a variety of manufacturers.
“This is one thing that upfront made for a more complicated supply chain,” she said. “But it’s a strong saving grace now, because we’re not reliant on one factory or one part of the world.”
The funding, Tishgart said, will allow Great Jones to invest in further product development and production. And while there are plenty of other cookware startups raising funding, she said that “it’s motivating, it’s exciting to see how other people interpret it” and that the different brands “all speak to different customers.”
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What happens to high-flying startups if the pandemic trade flips?
So much can change in a day.
This morning, news that a trial COVID-19 vaccine candidate had an effective rate of more than 90% shook the financial world. The Pfizer vaccine is reportedly so effective, the company “will have manufactured enough doses to immunize 15 to 20 million people” by the end of the year, according to the New York Times, appears to have given investors the green light to pile back into companies harmed by the pandemic.
The Exchange explores startups, markets and money. Read it every morning on Extra Crunch, or get The Exchange newsletter every Saturday.
The shift of money from shares that proved popular during the summer is massive and abrupt. Zoom and Peloton are down sharply this morning, while Uber and Lyft are soaring. Indeed, the Dow Jones Industrial Average and S&P 500 indices are up around 4.8% and 3.3% respectively, while SaaS and cloud share are off 3.5%.
Investors are taking money out of companies that were expected to do well thanks to the pandemic and moving that capital into firms that were weakened by the pandemic.
Our question for this morning: what do these changes mean for the economic forces that have broadly favored venture-backed startups? What happens to high-flying startups if the pandemic trade flips? What’s next for insurtech, edtech, fintech and SaaS? Let’s discuss.
Hot sectors, warm futures?
Short-term market movements do not always predict the future accurately, so we should not treat today’s trading as gospel.
That said, it’s not hard to draw some basic conclusions from the trading activity. Here’s what I think we can deduce from today’s stock market activity:
- Corporate software spend growth will slow: The broad decline in the value of software companies today appears to indicate that investors expect slower growth in the future. This is especially sharp in companies boosted by the pandemic itself, and, it appears, less acute in companies that were less helped by the COVID-19 economy. Our read? Investors are betting that growth amongst the companies that most benefited from a switch to remote work, for example, will see the greatest deceleration from recent forecasts. For startups, the lesson here is plain. Go look at your public comps and consider your own valuation likely trading along similar lines.
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Equity Monday: Vaccine news scrambles the stock market, shakes up startups
Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast where we unpack the numbers behind the headlines.
This is Equity Monday, our weekly kickoff that tracks the latest big news, chats about the coming week, digs into some recent funding rounds and mulls over a larger theme or narrative from the private markets. You can follow the show on Twitter here and myself here — and don’t forget to check out last Friday’s episode that we wound up titling “Fortnite is actually a SaaS company.”
It makes sense in context, I promise.
Anyway, here’s what’s on today’s show:
- Joe Biden was elected president and the stock market is not mad about divided government.
- Positive vaccine news sent many stocks sharply higher this morning, but not all. Some pandemic-favored tech companies instantly dropped double-digit percentage points of value.
- Esign raised $151 million, showing strength in the Chinese startup market, and the e-signature space.
- And this neat Series B for Cellwize caught our attention this morning.
- Finally, a warning. The stuff that is changing lately may begin to change a bit less. We’ve lived in the pandemic economy long enough now that it’s hard to recall what life was like before. But, we’d best start remembering, as there’s a lot that is going to change in the next few quarters.
This has been a wild day to start the week, but with good news.
I suppose a vaccine was always going to eventually make it to this step, but, that said, the United States is seeing record COVID-19 cases today. So mask up and let’s get as many of us across the line as we can.
Equity drops every Monday at 7:00 a.m. PDT and Thursday afternoon as fast as we can get it out, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.
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Here comes the next IPO wave
This is The TechCrunch Exchange, a newsletter that goes out on Saturdays, based on the column of the same name. You can sign up for the email here.
Are you tired? I am. What a week. But, if you kept your eyes off American politics and instead focused on the stock market, this was not a week of stress at all. It was a celebration.
Yes, the election appears to be influencing stocks, with investors delighted at what could be a divided government. Their bet is that with different parties in control of different bits of the government, nothing will happen, and thus taxes and regulation won’t change. You can handicap that as you wish.
Regardless, this week’s stock market boom was a multifaceted affair. Software stocks rallied as the summer-era trade appeared to come back into vogue, in which investors pour capital into SaaS and cloud companies in hopes of parking their wealth into something with growth potential. Software earnings also look pretty good thus far (we chatted with JFrog and Ping Identity and BigCommerce), improving on their early performance.
Uber and Lyft drove their own rally as California voters decided that their long-standing labor arbitrage would stand. And then Uber failed to vomit on itself during its earnings report. Not bad.
Big tech stocks rose, as well. All this is to say that after some fear in the market a week ago, things are back to being heated for tech companies. And it is, as we expected, flushing out the next wave of IPOs.
Airbnb is expected to file publicly early next week (we have four questions here that we cannot wait to get answered), and Upstart actually filed this week, which you probably missed because you were watching something else. No worries. We are here for you.
Another notable possible include DoorDash, now unshackled from its expensive California regulatory battle. How many debuts shall we see? Hopefully many.
Market Notes
Upstart’s IPO filing brings a fintech IPO to the fore, and overall its numbers are pretty good if you discount worries about its customer concentration. Its debut could augur well for fintech as a whole, a segment of the startup population that, when viewed through the lens of PayPal’s earnings, is having a hell of a year.
Fintech VCs are active, as well, dropping over $10 billion into startups focusing on financial technology products and services in Q3. Payments, insurtech, wealth management and banking startups caught our eye as sectors to watch in that niche.
It was not a perfect week for fintech, however, as the U.S. government decided that the Visa-Plaid deal should not happen. Damn. As discussed on Equity, this deal could limit M&A interest for fintech startups from large players. Does that mean that fintech IPOs, then, have to carry the liquidity bucket for the sector?
Maybe! And if so, Upstart’s impending flotation seems to take on extra importance. We’ll keep you posted.
- Moving along, the Ant Group IPO termination by the Chinese government was probably the biggest tech story of the week, though as the company is worth a few hundred billion, it’s not really a startup event. For China, it’s a bad day, as it undercuts its goal of becoming a global financial center. For Ant, it’s a huge setback. For Jack Ma, it’s a warning, if not more.
- The nine-figure neobank rounds? Not done yet.
- Pony’s epic raise this week makes the point that self-driving tech is not dead. Indeed, the great race to let computers drive continues. Just more slowly than everyone had hoped.
- Udacity underscored the edtech boom by raising $75 million in debt and reported “Q3 bookings up by 120% year-over-year and average run rates up 260% in H1 2020.” Our own Natasha Mascarenhas also reported on booming edtech M&A volume, again highlighting that edtech has gone from zero to hero in 2020, at least from a VC perspective.
- $30 million for Hustle Fund, and €66.5M for All Iron Ventures, among other VC raises this week.
- ByteDance is looking for $2 billion at a valuation of $180 billion? Also, what happened to the whole TikTok fiasco?
- And TikTok’s rival’s IPO filing really shows how hard it is to build a similar network. It’s also very expensive.
Various and Sundry
Sticking under our target word count for the first time in so long I nearly forgot what it is, here are a few iotas and crumbs for your weekend:
- The volcano method for understanding the fintech revolution
- How Fortnite plans to get back onto iOS
- VCs dropping Form D filings on Election Day did not prevent us from finding them
- Some good news and some great news
Have a good weekend. Stay safe. Fight COVID-19. And listen to this.
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Inside fintech startup Upstart’s IPO filing
While the world awaits the Airbnb IPO filing that could come as early as next week, Upstart dropped its own S-1 filing. The fintech startup facilitates loans between consumers and partner banks, an operation that attracted around $144 million in capital prior to its IPO.
First Round Capital, Khosla Ventures, Third Point Ventures, Rakuten and The Progressive Corporation led rounds in the startup, according to Crunchbase data.
There’s quite a lot to like in Upstart’s IPO filing, including rapidly advancing revenues and recent profitable period. However, the company’s revenue concentration could be a concern to some investors who recall what recently happened to Fastly shares after losing a large customer.
PitchBook data indicates that the company was last valued at $750 million thanks to its 2019 Series D worth $50 million. Can Upstart reach unicorn status with its IPO? Let’s peek at the numbers and try to answer the question.
Results, earnings
Upstart’s technology uses what it describes as artificial intelligence (AI) to approve consumer loans. It collects consumer demand for credit and connects that demand to bank partners who fund the loans. The company’s AI-powered credit tool can give consumers “higher approval rates [and] lower interest rates,” according to its S-1 filing, which offers banks “access to new customers, lower fraud and loss rates, and increased automation.”
If Upstart’s AI tool can, in fact, more intelligently determine consumer creditworthiness, everyone could come out a winner, with consumers paying less and banks adding to their loan books without taking on outsized risk.
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As tech stocks rally, bring on the IPOs
During yesterday’s tense voting and this morning, shares of American-listed technology companies are shooting higher.
The tech-heavy Nasdaq composite is up around 3.35% this morning, more than double what the broad S&P 500 index is currently managing. SaaS and cloud stocks kicked off the day up a staggering 4.98%, a sharp rally in the value of smaller, more growth-oriented technology companies.
The Exchange explores startups, markets and money. Read it every morning on Extra Crunch, or get The Exchange newsletter every Saturday.
For technology companies on the wings of the IPO market, it’s great news.
In 2020 it can be easy to forget, but tech stocks do not have to rise. They merely have in recent months, perhaps warming the waters for more technology debuts as the fourth quarter races toward its midpoint. The Exchange has heard whispers from several folks that the late-November/early-December period could be active for new filings, bringing rising stocks and pent-up demand together for a possible IPO run.
We’ll see. Today’s rally — and ballot measure results in California — could be the push companies like Airbnb and DoorDash needed to stop faffing around with private filings.
In pedestrian terms, the getting is good right now for public tech companies, so if you are going to go public, go get got while the getting stays good.
Today, let’s examine recent market gains for tech stocks and remind ourselves who is expected to go public next. Then, of course, chat about all the unicorns on the unofficial IPO list who could find a greased path ahead of them toward a flotation.
Gains
Big tech stocks are gaining, small stocks are up and software companies are hot. The NASDAQ is now less than 5% away from its all-time highs, and the Bessemer Cloud Index is now just 9% down from its own, a rebound from its prior status in correction territory. (A correction occurs when an index falls 10% or more from highs.)
So, who does the rally help? Let’s rock through a list:
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Intel has acquired Cnvrg.io, a platform to manage, build and automate machine learning
Intel continues to snap up startups to build out its machine learning and AI operations. In the latest move, TechCrunch has learned that the chip giant has acquired Cnvrg.io, an Israeli company that has built and operates a platform for data scientists to build and run machine learning models, which can be used to train and track multiple models and run comparisons on them, build recommendations and more.
Intel confirmed the acquisition to us with a short note. “We can confirm that we have acquired Cnvrg,” a spokesperson said. “Cnvrg will be an independent Intel company and will continue to serve its existing and future customers.” Those customers include Lightricks, ST Unitas and Playtika.
Intel is not disclosing any financial terms of the deal, nor who from the startup will join Intel. Cnvrg, co-founded by Yochay Ettun (CEO) and Leah Forkosh Kolben, had raised $8 million from investors that include Hanaco Venture Capital and Jerusalem Venture Partners and PitchBook estimates that it was valued at around $17 million in its last round.
It was only a week ago that Intel made another acquisition to boost its AI business, also in the area of machine learning modeling: it picked up SigOpt, which had developed an optimization platform to run machine learning modeling and simulations.
While SigOpt is based out of the Bay Area, Cnvrg is in Israel and joins an extensive footprint that Intel has built in the country specifically in the area of artificial intelligence research and development, banked around its Mobileye autonomous vehicle business (which it acquired for more than $15 billion in 2017) and its acquisition of AI chipmaker Habana (which it acquired for $2 billion at the end of 2019).
Cnvrg.io’s platform works across on-premise, cloud and hybrid environments and it comes in paid and free tiers (we covered the launch of the free service, branded Core, last year). It competes with the likes of Databricks, Sagemaker and Dataiku as well as smaller operations like H2O.ai that are built on open source frameworks.
While Intel is not saying much about the deal, it seems that some of the same logic behind last week’s SigOpt acquisition applies here as well: Intel has been refocusing its business around next-generation chips to better compete against the likes of Nvidia and smaller players like GraphCore. So it makes sense to also provide/invest in AI tools for customers, specifically services to help with the compute loads that they will be running on those chips.
It’s notable that in our article about the Core free tier last year, Frederic noted that those using the platform in the cloud can do so with Nvidia-optimized containers that run on a Kubernetes cluster. It’s not clear if that will continue to be the case, or if containers will be optimized instead for Intel architecture, or both. Cnvrg’s other partners include Red Hat and NetApp.
Intel’s focus on the next generation of computing aims to offset declines in its legacy operations. In the last quarter, Intel reported a 3% decline in its revenues, led by a drop in its data center business. It said that it’s projecting the AI silicon market to be bigger than $25 billion by 2024, with AI silicon in the data center to be greater than $10 billion in that period.
In 2019, Intel reported some $3.8 billion in AI-driven revenue, but it hopes that tools like SigOpt’s will help drive more activity in that business, dovetailing with the push for more AI applications in a wider range of businesses.
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Pulled Ant Group IPO costs Alibaba nearly $60B in market cap
News today that Ant Group’s IPO is suddenly on hold in both Shanghai and Hong Kong caused a sell-off of Alibaba shares. This afternoon, equity in sister-company Alibaba is off around 8% in the wake of the delayed offering and news that Ant had run into regulatory issues with the Chinese government.
Ant was spun out of Alibaba, which owns a one-third stake in the financial technology powerhouse.
Ant’s IPO was on track to be among the largest in history, perhaps raising as much as $34.5 billion in its dual-listing share sale. The company was going to have little trouble filling that book, with retail demand for its shares at IPO reaching nearly $3 trillion in mainland China alone (it’s not uncommon for popular share issues to have massive oversubscription).
That the IPO was called off is financial news on a scale that is hard to comprehend. Ant would have sported a possible market valuation of more than $300 billion at its IPO price. Such a valuation would rank it amongst the most valuable companies in the world.
Alibaba is worth around $772 billion today after the news, off from a value of around $841 billion yesterday. Ant’s delay has cost its former parent company around $60 billion in market capitalization in a single day.
Ant has its roots in Alipay, an online payment service founded in 2004. The company’s Alibaba spin-out came seven years later in 2011, with its former parent company buying 33% of its value in 2018 ahead of its planned IPO. At the time, Ant was valued around $60 billion.
The company’s IPO prospectus details the company’s work in credit, investing, insurance and other fintech-related areas. Ant’s reach has become staggering over time, with Alipay counting over 1 billion annual active users and over 80 million active merchants on the platform.
Ant competes with Tencent’s WePay, amongst other products and services.
As TechCrunch reported this morning, Ant has a history of regulatory issues with the Chinese Communist Party. Precisely what went wrong this time so close to its debut is still not perfectly clear, but news that Alibaba founder and Ant chairman Jack Ma had dinged China’s financial regulation in recent weeks could be part of the issue.
So long as the IPO remains on hold, and a cloud sits atop Mt. Ant, Alibaba shares could remain depressed.
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Indonesian logistics platform Logisly raises $6 million Series A to digitize truck shipments
Indonesia’s logistics industry is very fragmented, with several large providers operating alongside thousands of smaller companies. This means shippers often have to work with a variety of carriers, driving up costs and making supply chains harder to manage. Logisly, a Jakarta-based startup that describes itself as a “B2B tech-enabled logistics platform,” announced today it has raised $6 million in Series A funding to help streamline logistics in Indonesia. The round was led by Monk’s Hill Ventures.
This brings the total Logisly has raised since it was founded last year to $7 million. Its platform digitizes the process of ordering, managing and tracking trucks. First, it verifies carriers before adding them to Logisly’s platform. Then it connects clients to trucking providers, using an algorithm to aggregate supply and demand. This means companies that need to ship goods can find trucks more quickly, while carriers can reduce the number of unused space on their trucks.
Co-founder and chief executive officer Roolin Njotosetiadi told TechCrunch that about “40% of trucks are utilized in Indonesia, and the rest are either sitting idle or coming back from their hauls empty handed. All of these result in high logistics costs and late deliveries.”
He added that Logisly is “laser focused on having the largest trucking network in Indonesia, providing 100% availability of cost-efficient and reliable trucks.”
Logisly now works with more than 1,000 businesses in Indonesia in sectors like e-commerce, fast-moving consumer goods (FCG), chemicals and construction. This number includes 300 corporate shippers. Logisly’s Series A will be used on growing its network of shippers and transporters (which currently covers 40,000 trucks) and on product development.
The startup’s clients include some of the largest corporate shippers in Indonesia, including Unilever, Haier, Grab, Maersk and JD.ID, the Indonesian subsidiary of JD.com, one of China’s largest e-commerce companies.
Other venture capital-backed startups that are focused on Indonesia’s logistics industry include Shipper, which focuses on e-commerce; logistics platform Waresix; and Kargo.
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NerdWallet acquires small business loan marketplace Fundera
Financial guidance company NerdWallet announced at the end of last week that it has acquired Fundera. New York City-based Fundera was co-founded in 2013 by Jared Hecht, who previously co-founded GroupMe. It created a marketplace where small businesses could find loans, subsequently expanding into other areas like legal services, while also (like NerdWallet) offering free financial content.
“It can be the wild wild west out there for small business owners,” Hecht said in a statement. “Finding the financial products and the guidance needed to start, grow and fund their businesses can be very challenging, and most small business owners don’t have a resource or partner to support them along their journey. Bringing transparency to this process and educating, empowering and advocating for business owners is so similar to what we see NerdWallet doing in the consumer space.”
And of course, small businesses may be in particularly dire need of assistance now, given the impact of the pandemic.
According to the announcement, Fundera will operate as a subsidiary of NerdWallet, with the entire team making the transition. The goal is to help NerdWallet expand into the small- and medium-business market with both content and actual financing.
“Although we offer free tools and content, we’ve never been able to fully support small business owners — that changes today,” said NerdWallet co-founder and CEO Tim Chen. “Fundera has been one of our partners for several years and their deep understanding of the SMB market, the long-standing, trusted relationships they’ve built with both lenders and business owners, and their commitment to putting the needs of small business owners first is really unique and impressive.”
The financial terms of the acquisition were not disclosed. Fundera had raised $18.9 million in funding from investors including QED Investors, Khosla Ventures, First Round Capital and Susquehanna Growth Equity, according to Crunchbase.
This is NerdWallet’s second acquisition of 2020, having previously acquired U.K.-based Know Your Money. The company says it’s been growing and profitable for the past several years.
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