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Performance marketing agency MuteSix bets on content and data to boost DTC e-commerce
Warby Parker filing to IPO last week was one more sign that direct-to-consumer (DTC) is an extremely powerful e-commerce trend. But LA-based performance marketing agency MuteSix didn’t wait that long to build its business around scaling DTC brands.
Created in 2014 and acquired by Dentsu in 2019, MuteSix was recommended to TechCrunch by Rhoda Ullmann, VP Consumer at Sense, a Boston-based startup building a home energy monitor. “They demonstrate best-in-class expertise with Facebook and Google paid ad platforms. They also have a very smart and efficient approach to creative development that was critical to helping us scale,” she wrote. (If you have growth marketing agencies or freelancers to recommend, please fill out our survey!)
Besides Sense, MuteSix’s former and current clients include companies such as Adidas, Petco, Ring and Theragun, to whom it provides a full range of marketing services, including top-notch direct response videos. But regardless of whether you can afford this, we think you’ll learn interesting lessons from our conversation with their CRO, Greg Gillman. The key takeaway? In today’s highly competitive ad environment, both content and data are kings.
Editor’s note: The interview below has been edited for length and clarity.
What can you tell us about MuteSix as an agency?
Image Credits: MuteSix
Greg Gillman: We’ve been around for about nine years. We started out as a Facebook ad agency — as opposed to a lot of agencies that start out by saying they do everything, we decided to focus on what we were really good at. At the time, it was doing Facebook media buying for e-commerce companies. Primarily here in LA, which is kind of the hub of these companies, but also all over. And then bit by bit, we grew the organization.
At this point, we’re a little over 400 people, and we manage upward of $500 million in spend on Facebook and Google, including Instagram and YouTube. What we’ve grown into is a one-stop shop for DTC e-commerce companies: We manage all the channels that a DTC brand needs. And we’re a performance agency; everything we do is based on results. People come to us to drive revenue into their e-commerce businesses.
Why do you think that performance marketing is the right fit for DTC?
DTC entrepreneurs are more focused on immediate impact, because if they’re not selling product, there’s no large brand propping them up. So I think that doing DTC marketing requires you to be more performance focused. For agencies that work with large brands, usually it’s more about impression buying versus performance buying. They can say: I did a reach campaign today to hit 10 million eyeballs, and whatever happens happens, because at the end of the day, you just told us to do 10 million impressions. It’s different than working with a group like us that’s trying to optimize every small piece of the funnel, and being accountable for the entire funnel to drive as much sales or revenue.
What type of clients do you work with?
The majority of the companies we work with are digitally native DTC companies. We’ve mostly stayed in that lane, because we’re really good at it. That being said, we work with companies of all sizes — startups, companies that are already established, and very large companies that need to rework both their creative and their media buying strategy.
I oversee sales, marketing and partnerships, and my role is really trying to figure out which brands make most sense to partner with MuteSix. We’re looking for high-growth brands that we can scale, and we’ve learned through the years that what works well are demonstrable products that have cool user value props.
We’ve worked with lots of startups at different points in the funnel, starting from the ground up and working with them through various rounds of funding, all the way through acquisitions, including two by unicorns. But these days, ground up is tougher. I like them to have some proof of concept — putting through $10,000-$15,000 per month on Facebook or $5,000-10,000 on Google usually shows me that there’s some life to it. But I don’t want to limit us if it’s a cool idea. I talk to a lot of people who come back once they’ve proven it out a little bit.
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What kind of clients are definitely not a good fit?
It won’t be a fit if there’s no real unique value prop for the product. If it’s just another run-of-the-mill company, a consultant can charge them a lower amount of money and set up Facebook ads, but what we are looking for are high-growth businesses.
The compensation for our campaign managers is actually tied to the performance of the campaigns, so if I bring a bunch of campaigns that we can’t scale, we’re gonna have a lot of unhappy media buyers who ask: “Greg, why would we take on this brand?” It’s a business model that has helped us attract top talent, but we need to make sure that we’re bringing brands that we think we can scale.
And it’s easier than ever to start a company, but it’s tougher now to scale it and take it past the $2 million-$3 million run rate. So I always revert back to asking founders: What are five reasons why people want to buy your product? What are the five reasons that they don’t? If the entrepreneur has trouble answering this, it’s not going to work. If they can’t tell somebody why their business is good, then we’re not going to be good at selling it.
How is MuteSix different from other agencies?
I’d say the main difference is that we have a 70-person in-house video creative team; and what we’re really good at doing is shooting and coming up with performance content. Not just content that looks and feels great, but video that is reverse-engineered to sell product.
Another key component is that we have a whole data science team that is also integrated with our media buying team, and that helps companies navigate things like attribution and signal loss due to the iOS 14 update. Right now, that means focusing on looking at the whole picture rather than by channel and working on mix-modeling attribution.
What are some of the things your data team focuses on?
One of the biggest things that brands struggle with is figuring out attribution, and how you continue to spend money even though you may have lost some signal into the platform. If Facebook skews too heavily, and Google is on last click, then sometimes it looks like things are never working. To help companies make informed business decisions, we are building statistical models that show information at higher-than-the-platform level.
We are also building better segments of customer profiles that help the clients understand who their core audience is, but also helps us build predictive audiences for finding new people.
Another big thing we’re trying to solve is incrementality. We work with large brands that have a strong organic following on social media; and their question is: “Hey, Greg, why should I spend more money if I would have acquired those users anyway?” So we’ve done incrementality testing with brands that spend a lot in other channels than Facebook and Google. We helped them build out different ways to look at the data so that we continue to spend in those channels and they actually know the incremental lift that they’re getting.
There’s one other piece that I think is super important and usually overlooked: first-party data. We work with brands to try and acquire as much of that first-party data as possible, segment it and use it, because that’s what they’d be left with if Facebook shut off tomorrow.
How do you prepare and adapt for changes in the marketing ecosystem?
Because we work with so many brands, we have a lot of senior leadership on each channel level. We routinely meet across departments and share insights. The data science team also builds pretty robust reporting. We try to stay ahead of our brands and to be forward-thinking about anything that is ultimately going to impact the agency. We’re constantly trying to hack our way through things like the types of content that work and things that we know will help us scale.
That’s how we have always approached it. Every major shift in our business was done to answer the needs of the brands that we were working with. For instance, there’s a data side to our business because it’s more important than ever to use that. Facebook used to be a platform where you could throw anything at the wall, and you would get a 4x or 5x return. No one’s asking about data when you’re literally printing money out of Facebook, right? It only happens when the margins get tight. But then Facebook became a more crowded platform, and the same happened with Google: more advertisers, higher CPM and a more competitive environment. We needed to be smarter about what we were doing, so we built out our data team.
Now there’s two levers that we can pull: the data side and the creative side of the business. Again, we are a performance marketing agency, focusing on all the levers. Because platforms like Facebook are only going to be more competitive, they’re only going to get more expensive, and we are only going to lose more traffic. So the more agile agencies have to think much farther outside of what we are doing on these platforms; because we’re going to make up the incremental revenue on things like SMS, influencer marketing and organic content, to continue to drive money into the top of the funnel.
Why is your content arm so important as a lever?
We have an integrated solution where our media buyers are paired directly with our video editors and producers to allow us to be agile and quick; because as everyone knows, content is king. What we try to do is optimize around things like what we call the thumbs-up rate on Facebook — three-second video views. If I held someone for that long in their newsfeed, I can potentially get them into our flow. We do the same on YouTube, and we do things like this on programmatic, because the name of the game is to get people into the funnel and work them through it. And we’re using both our data science team and our creative team to build out and optimize on the front end around these quick metrics to get things moving.
In my opinion, there’s no close second to an SMB agency that has a content arm like we do. Leveraging our content team to build performance content is one of the biggest levers that we have. Three and a half years ago, Facebook was telling us: “If you don’t build video content, and if you don’t prioritize video in the newsfeed, it’s not going to work.” At the time, we leaned in very hard — and the pain of growing a creative team of 70 people is real, especially in LA. But it’s allowed us to scale our agency.
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Virtual meeting platform Vowel raises $13.5M, aims to cure meeting fatigue
Meetings are an inevitable part of the work day, but as workplaces became more distributed over the past 18 months, Vowel CEO Andy Berman says we are steadily moving toward “death by meeting.”
His virtual meeting platform is the latest to receive venture capital funding — $13.5 million — with the goal of making meetings more useful before, during and after.
Vowel is launching a meeting operating system with tools like real-time transcription; integrated agendas, notes and action items; meeting analytics; and searchable, on-demand recordings of meetings. The company has a freemium business model and will also be rolling out a business plan this fall for $16 per user per month. Extra features will include advanced integrations, security and admin controls.
The Series A was led by David Hornik of Lobby Capital, who was joined by existing investors Amity Ventures and Box Group and a group of individual investors, including Calendly CEO Tope Awotona, Intercom co-founder Des Traynor, Slack VP Ethan Eismann, former Yammer executive Viviana Faga, former InVision president David Fraga and Okta co-founder Frederic Kerrest.
Prior to starting Vowel, Berman was one of the founders of baby monitor company Nanit. The company had teams spread out around the world, and communication was tough as a result. In 2018, the company went looking for a tool that would work for synchronous and asynchronous meetings, but there were still a lot of time zones to manage, he said.
Taking a cue from Nanit’s own baby monitors that were streaming video over 17 hours a day, the idea for Vowel was born, and the company began to focus on the hypothesis that distributed work would be prevalent.
“People initially thought we were crazy, but then the pandemic hit, and everyone was learning how to work remotely,” Berman told TechCrunch. “As we now go back to hybrid work, we see this as an opportunity.”
In 2017, Harvard Business Review reported that executives spent 23 hours in meetings each week. Berman now estimates that the average worker spends half of their time each week in meetings.
Vowel is out to bring Slack, Figma and GitHub components to meetings by recording audio and video that can be paused at any time. Users can add notes and see where those notes fall within a real-time transcription that enables people who arrive late or could not make the meeting to catch up easily. After meetings are over, they can be shared, and Vowel has a search function so that users can go back and see where a particular person or topic was discussed.
The new funding will enable the company to grow its team in product, design and engineering. Vowel plans to hire up to 30 new people over the next year. The company recently closed its beta test and has amassed a 10,000-person waitlist. The public launch will happen in the fall, Berman said.
Workplace productivity and office communication tools are not new concepts, but as Berman explained, became increasingly important when homes became offices over the past 18 months.
Competitors took different approaches to solving these problems: focusing on video conferencing or audio or meeting management with plugins. Berman says an area where many have not succeeded yet is integrating meetings into the typical workflow. That’s where Vowel comes in with its “meeting OS,” he added.
“Our goal is to make meetings more inclusive and worthwhile, which includes the prep, the meeting and the follow-up,” Berman said. “We see the future will be about knowledge management, so the difference between what we are doing is ensuring you can catch up quickly and keep that knowledge base. A Garner report said that 75% of workplace meetings will be recorded by 2025, and that is a trend we are reinventing from the ground up.”
David Hornik, founding partner at Lobby Capital, said he became acquainted with Vowel from its existing investor Amity Ventures. Hornik, who sits on the GitLab board, said GitLab was one of the largest distributed companies in the tech space, prior to the pandemic, and saw first-hand the challenge of making distributed teams functionable.
When Hornik heard about Vowel, he said he “jumped quickly” on the opportunity. His firm typically invests in platform businesses that have the capacity to transform business spaces. Many are pure software, like Splunk or GitLab, while others are akin to Bill.com, which transformed how small businesses manage financial operations, he added.
All of those combine into a company, like Vowel, especially given the company’s vision for a meeting OS to transform a meeting space that hadn’t moved forward in decades, he said.
“This was quickly obvious to me because my day is meetings — an eight-Zoom day is a normal day — I just wish I could remember everything,” Hornik said. “Speaking with early customers using the product, when I asked them what they would do if this ever went away, the first thing they said was ‘cry,’ and, because there was no alternative, would return to Zoom or other tools, but it would be a big setback.”
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Seqera Labs grabs $5.5M to help sequence COVID-19 variants and other complex data problems
Bringing order and understanding to unstructured information located across disparate silos has been one of the more significant breakthroughs of the big data era, and today a European startup that has built a platform to help with this challenge specifically in the area of life sciences — and has, notably, been used by labs to sequence and so far identify two major COVID-19 variants — is announcing some funding to continue building out its tools to a wider set of use cases, and to expand into North America.
Seqera Labs, a Barcelona-based data orchestration and workflow platform tailored to help scientists and engineers order and gain insights from cloud-based genomic data troves, as well as to tackle other life science applications that involve harnessing complex data from multiple locations, has raised $5.5 million in seed funding.
Talis Capital and Speedinvest co-led this round, with participation also from previous backer BoxOne Ventures and a grant from the Chan Zuckerberg Initiative, Mark Zuckerberg and Dr. Priscilla Chan’s effort to back open source software projects for science applications.
Seqera — a portmanteau of “sequence” and “era”, the age of sequencing data, basically — had previously raised less than $1 million, and quietly, it is already generating revenues, with five of the world’s biggest pharmaceutical companies part of its customer base, alongside biotech and other life sciences customers.
Seqera was spun out of the Centre for Genomic Regulation, a biomedical research center based out of Barcelona, where it was built as the commercial application of Nextflow, open source workflow and data orchestration software originally created by the founders of Seqera, Evan Floden and Paolo Di Tommaso, at the CGR.
Floden, Seqera’s CEO, told TechCrunch that he and Di Tommaso were motivated to create Seqera in 2018 after seeing Nextflow gain a lot of traction in the life science community, and subsequently getting a lot of repeat requests for further customization and features. Both Nextflow and Seqera have seen a lot of usage: the Nextflow runtime has been downloaded more than 2 million times, the company said, while Seqera’s commercial cloud offering has now processed more than 5 billion tasks.
The COVID-19 pandemic is a classic example of the acute challenge that Seqera (and by association Nextflow) aims to address in the scientific community. With COVID-19 outbreaks happening globally, each time a test for COVID-19 is processed in a lab, live genetic samples of the virus get collected. Taken together, these millions of tests represent a goldmine of information about the coronavirus and how it is mutating, and when and where it is doing so. For a new virus about which so little is understood and that is still persisting, that’s invaluable data.
So the problem is not if the data exists for better insights (it does); it is that it’s nearly impossible to use more legacy tools to view that data as a holistic body. It’s in too many places, and there is just too much of it, and it’s growing every day (and changing every day), which means that traditional approaches of porting data to a centralized location to run analytics on it just wouldn’t be efficient, and would cost a fortune to execute.
That is where Segera comes in. The company’s technology treats each source of data across different clouds as a salient pipeline which can be merged and analyzed as a single body, without that data ever leaving the boundaries of the infrastructure where it already exists. Customised to focus on genomic troves, scientists can then query that information for more insights. Seqera was central to the discovery of both the Alpha and Delta variants of the virus, and work is still ongoing as COVID-19 continues to hammer the globe.
Seqera is being used in other kinds of medical applications, such as in the realm of so-called “precision medicine.” This is emerging as a very big opportunity in complex fields like oncology: cancer mutates and behaves differently depending on many factors, including genetic differences of the patients themselves, which means that treatments are less effective if they are “one size fits all.”
Increasingly, we are seeing approaches that leverage machine learning and big data analytics to better understand individual cancers and how they develop for different populations, to subsequently create more personalized treatments, and Seqera comes into play as a way to sequence that kind of data.
This also highlights something else notable about the Seqera platform: it is used directly by the people who are analyzing the data — that is, the researchers and scientists themselves, without data specialists necessarily needing to get involved. This was a practical priority for the company, Floden told me, but nonetheless, it’s an interesting detail of how the platform is inadvertently part of that bigger trend of “no-code/low-code” software, designed to make highly technical processes usable by non-technical people.
It’s both the existing opportunity and how Seqera might be applied in the future across other kinds of data that lives in the cloud that makes it an interesting company, and it seems an interesting investment, too.
“Advancements in machine learning, and the proliferation of volumes and types of data, are leading to increasingly more applications of computer science in life sciences and biology,” said Kirill Tasilov, principal at Talis Capital, in a statement. “While this is incredibly exciting from a humanity perspective, it’s also skyrocketing the cost of experiments to sometimes millions of dollars per project as they become computer-heavy and complex to run. Nextflow is already a ubiquitous solution in this space and Seqera is driving those capabilities at an enterprise level – and in doing so, is bringing the entire life sciences industry into the modern age. We’re thrilled to be a part of Seqera’s journey.”
“With the explosion of biological data from cheap, commercial DNA sequencing, there is a pressing need to analyse increasingly growing and complex quantities of data,” added Arnaud Bakker, principal at Speedinvest. “Seqera’s open and cloud-first framework provides an advanced tooling kit allowing organisations to scale complex deployments of data analysis and enable data-driven life sciences solutions.”
Although medicine and life sciences are perhaps Seqera’s most obvious and timely applications today, the framework originally designed for genetics and biology can be applied to any a number of other areas: AI training, image analysis and astronomy are three early use cases, Floden said. Astronomy is perhaps very apt, since it seems that the sky is the limit.
“We think we are in the century of biology,” Floden said. “It’s the center of activity and it’s becoming data-centric, and we are here to build services around that.”
Seqera is not disclosing its valuation with this round.
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Ledgy is an equity management tool for European startups
Every startup founder faces the same issue — how do you manage your cap table and equity plans in a transparent and lightweight manner? If you’re based in the U.S., chances are you’re using an equity management solution like Carta. But if you’re not based in the U.S., you don’t have a ton of options.
Ledgy wants to become the ownership management tool for the rest of the world. Based in Switzerland, several well-known European startups are already using Ledgy, such as Wefox, Kry, Bitpanda, Gorillas and Trade Republic.
The company recently closed a $10 million Series A funding round led by Sequoia Capital. Other investors in the round include Xavier Niel, Harry Stebbings, Visionaries Club, UiPath’s Daniel Dines and Front’s Mathilde Collin. Some of Ledgy’s existing investors also invested once again, such as Myke Näf, Paul Sevinç, btov Partners, Creathor Ventures and VI Partners.
A few years ago, when Ledgy co-founder and CEO Yoko Spirig talked with an entrepreneur, the founder showed her how he managed ownership. He opened an Excel spreadsheet and scrolled, scrolled, scrolled… “Each line represented a share. You can imagine how error-prone it is,” she told me.
While the implementation was odd, most companies in Europe are still using Excel spreadsheets to manage ownership. And Ledgy wants to convince those companies that switching to a software solution that has been specifically designed to solve this issue could be beneficial.
“The key has really been to focus on the software infrastructure. What we do is that we have implemented automation workflows that are adaptable depending on countries,” Spirig said. “We’re not focusing on one regulation and we’re really offering the infrastructure layer,” she added.
That’s why Ledgy already supports 32 countries. It has tweaked its product even more specifically for Germany, Austria and Switzerland. There will be more country-specific releases in the near future for startups based in the U.K. and France. 1,500 companies are using Ledgy right now.
When you switch to Ledgy, there are three main advantages. First, like other software-as-a-service products, Ledgy acts as a single source of truth for all stakeholders — the HR team, the finance team, investors, lawyers and employees.
The second selling point is that you can automate some of the most tedious tasks. For instance, Ledgy can automatically generate documents based on templates and different variables. Signed documents are stored on Ledgy. You can export data every quarter or every year for compliance reasons.
Third, it fosters transparency across the company. Employees can check the value of their options. They can see how much their options could be worth if the leadership team is in the process of raising a new round of funding.
With today’s funding round, Ledgy plans to expand into new markets. The company also plans to roll out support for public companies so that some of its existing customers can go public and keep using Ledgy.
Image Credits: Ledgy
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Portcast gets $3.2M to create more transparent and sustainable supply chains
Portcast founders Dr. Lingxiao Xia and Nidhi Gupta
For many manufacturers and freight forwarders, managing logistics is still a very manual process: tracking shipments with a call or online lookup, and entering that data into an Excel spreadsheet. Portcast, which describes itself as a “next-generation logistics operating system,” makes the process more efficient by gathering data from myriad sources and not only track shipments in real-time, but also predicts what might affect its progress, like major weather events, the tide and pandemic-related issues.
The company announced today it has raised $3.2 million in pre-Series A funding, led by Newtown Partners, through the Imperial Venture Fund, with participation from Wavemaker Partners, TMV, Innoport and returning investor SGInnovate. Based in Singapore, Portcast serves clients in Asia and Europe, and will use part of its funding to expand into more markets.
Co-founders Nidhi Gupta and Dr. Lingxiao Xia met at Entrepreneur First in Singapore. Before launching Portcast, Gupta, its chief executive officer, served in leadership roles across Asia at DHL. During that time, she realized the logistic sector’s “inefficiencies are actually an opportunity in this space to create something.” Dr. Xia, who holds a PhD in machine learning and has a background in product development and cloud computing, “was a great complementary fit” and is now Portcast’s chief technology officer.
Portcast says it tracks more than 90% of world trade volume that travels by ocean carriers, and 35% of air cargo, and can forecast demand for 30,000 trade routes. Sources include geospatial data, like satellite data about where ships are, what speed and direction they’re moving in, what ports they are headed for, wind speed and wave height. Portcast also looks at economic patterns (for example, Brexit’s impact on ports around the United Kingdom, and how vaccine rollouts around the world changes airline and ship capacity), weather events like typhoon and disruptions like the Suez Canal blockage.
Other data sources include proprietary transactional data from customers including large shipping companies and freight forwarders.
“The challenge for us is how do we let all of this data speak the same language,” Gupta told TechCrunch. “This data is coming in at different frequencies, different granularities, so how do you consolidate that and make sure the machine can start understanding it and interpreting it.”
Portcast’s two main solutions are currentlu Intelligent Container Visibility for real-time tracking of shipment containers, and Forecasting and Demand Management, which tracks booking patterns. Portcast doesn’t use IoT to track containers since it is cost-prohibitive to place a device in every one, but is working with IoT providers on hybrid solutions—for example, putting a tracking device in one container and then using that data to help manage the rest of the shipment.
The startup’s goal is to make predictions that help companies improve the efficiency of their operations, and reduce their reliance on manual processes. “There are logistics operators with hundreds of cargo coming in every single week, they’re going and checking this manually every day. That goes into an Excel sheet and that’s what the planning of downstream operations is based off of,” said Gupta.
But the COVID-19 pandemic created an “urgent need to digitize, and it’s transformed supply chains from being a cost function to the core of getting products on time, so we work with some of the largest manufacturers as well as freight forwarders,” she added. For example, a food and beverage company in Europe sent a shipment to Taipei, a trip that usually takes about 70 days. But it took more than three months to arrive. Portcast was able to track the shipment as it moved across different ports and ships, helping its customers understand what caused the delay.
“Besides just predicting when there will be a likely disruption, we’re able to pinpoint and say there’s a delay of X days because there will likely be a typhoon or a transshipment, and that empowers them because they can tell their trucking and warehousing teams how many containers are going to come in,” said Gupta. “This reduces port fees, detention charges and the number of hours spent on manually checking different company’s websites and trying to figure out what happened to their supply chain.”
One of Portcast’s advantages over other logistics tech startups that want to fix supply chain visibility is that it launched out of the Asia-Pacific region, where ships usually go through multiple ports and have to work around frequent weather events like tropical storms and typhoons. The technology Portcast developed to create shorter voyages between Singapore and Malaysia (for example) is also applicable to intercontinental routes like Asia and Europe, or Asia and the United States.
“Our technology is global in scale and that allows us to compete against other players in this market,” said Gupta. “The other thing that differentiates us is that we work not just with manufacturers, but also with shipping companies, logistics companies and cargo airlines, and that allows us to create network effects. There is a really strong synergy between what’s happening in ocean freight and air freight, and that allows us to understand patterns in the industry and creates leverage for any other company that comes onto our platform.
Portcast’s future plans include moving from predictive AI to include prescriptive AI within the next two quarters. Right now, the platform can tell companies what is causing delays, but prescriptive AI will also enable it to make automated suggestions. For example, it can tell clients what ports are faster, other ships and modes of transport that can help them get around a disruption and how to optimize their capacity.
The company is also planning to launch Order Visiblity by the end of this year, a feature that will track containers filled with a specific item. Consumer prices for many different kinds of products are rising, due in part to overwhelmed supply chains. By enabling companies to track specific SKUs in real-time, Portcast can not only help items arrive more quickly, but also show how much CO2 emissions each shipment creates.
“Carbon offsetting or carbon trading can only happen once you have visibility into how much you are actually spending, and that’s the piece we can get involved in,” said Gupta. “By allowing predictions like, for example, if you will arrive early, that’s an opportunity for a shipping company to slow down and save fuel like bunker fuel, which not only brings an immense amount of savings, but also reduces CO2 emissions.
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H2O Hospitality secures $30M Series C to expedite hotel digital transformation
The pandemic has triggered more demand for contactless and staff-less operations in the hospitality sector, and now H2O Hospitality, the unmanned hotel management company, has closed a $30 million round on the back of that boost. The South Korea and Japan-based startup automates front and backend processes including accommodation reservation, room management and front desk duties, and it will be using the funds to continue expanding its business.
The Series C round (equivalent to about 34 billion won) is being led by Kakao Investment and Korea Development Bank (KDB), Gorilla Private Equity, Intervest and NICE Investment also participated. With Southeast Asia’s joint fund, Kejora-Intervest Growth Fund also joined in the round, it is a sign that H2O Hospitality will be focusing specifically on the Southeast Asian Market. H2O Hospitality has raised $7 million Series B round from Samsung Ventures, Stonebridge Ventures, IMM Investment and Shinhan Capital in February 2020.
H2O Hospitality will expand its business further by adding various types of accommodations in South Korea and Japan in 2021 and 2022 and plans to enter Singapore and Indonesia in 4Q in 2022 in line with its Southeast Asia penetration strategy, according to H2O Hospitality co-founder and CEO John Lee.
“H2O Hospitality is currently speaking with several global hotel chain companies to partner with their digital transformation and operation outside of Korea and Japan,” Lee told TechCrunch.
H2O will invest in R&D to advance its customer channel solutions and contactless check-in systems depending on customer needs of each country in Asia, Lee continued.
“We need optimal system development and customization for each accommodation and situation to lead successful hotel digital transformation even after COVID-19,” Lee said in an email interview.
H2O Hospitality was founded in South Korea 2015 by CEO John Lee, and it has been on something of an acquisition-expansion spree. It entered Japan in 2017, for example, by acquiring several Japanese hospitality management companies. In 2021, H2O acquired two South Korean companies such as the contactless hotel solution company, ImGATE, and a local creator startup, Replace, in order to enhance its technology and ESG competence.
These days, the company operates approximately 7,500 accommodations including hotels, ryokans and guest houses, in Tokyo, Osaka, Seoul, Busan, and Bangkok.
H2O Hospitality’s Information and Communications Technology (ICT)-based hotel management system, which enables hotel management to automate and digitize, includes the Channel Management System (CMS), Property Management System (PMS), Room Management System (RMS), and Facility Management System (FMS).
Its integrated hotel management system can reduce hotel management’s fixed operating costs by 50%, while increasing revenue by as much as 20%, according to its statement.
“COVID-19 hit the hospitality industry the most and most of the hotels wanted to decrease their fixed cost level, but it was impossible with their current operational flow,” Lee continued, “They had to go through digital transformation”.
When asked how the pandemic affected H2O as COVID-19 still freezes most of the tourism industry, Lee said H2O’s revenue has been increased by as much as 30% before the pandemic, but that percentage has been dropped to 5-15% post COVID-19. Revenue drivers these days are based around tools it’s built to improve the efficiency of its customers. They include its automated dynamic pricing (ADR) tool and diverse sales channels like online and offline travel agencies in domestic and overseas, he said.
Lee also pointed out that H2O has been onboarding a lot of properties and that has also contributed to H2O’s revenue growth in the last 18 months. H2O was the only company in Asia, he claims, and many property owners have started to get onboard since August 2020, he explained.
“Every single hotel that we onboarded during the pandemic turned around their profits & losses statements and started to recover their financial loss,” Lee said.
There are currently about 16.4 million hotel rooms in the world that generate $570 billion a year, according to Lee. H2O believes that it can digitize all the lodging accommodations in the world as the company’s main goal is not building a hotel brand but allowing hotel owners to operate their properties with better operation, he said.
Lee explained that the current hotel operation process looks a lot like that of “2G phones”, that was at a stage before turning to smartphones, and H2O is turning the overall hotel operation into a “smartphone”.
“This is a very natural transition for the (hospitality) industry as it was also natural for the cellphone users to transit from 2G phone to smartphone,” Lee said.
Unfortunately, the cross-border inbound tourism market has still been stopped for both Korea and Japan even though each domestic market is still pumping demand for the market, Lee mentioned.
“We believe the inbound tourism market will recover within a year as the vaccinations grow for both countries (Korea and Japan),” Lee said.
Managing Director at Kejora-Intervest Growth Fund Jun-seok Kang told TechCrunch: “We knew this new wave for hotel digital transformation trend was coming even before the pandemic; however, COVID-19 definitely expedited the transition period, and we believe H2O will thrive in the transforming hotel market.”
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Mobius Labs nabs $6M to help more sectors tap into computer vision
Berlin-based Mobius Labs has closed a €5.2 million (~$6.1M) funding round off the back of increased demand for its computer vision training platform. The Series A investment is led by Ventech VC, along with Atlantic Labs, APEX Ventures, Space Capital, Lunar Ventures plus some additional angel investors.
The startup offers an SDK that lets the user create custom computer vision models fed with a little of their own training data — as an alternative to off-the-shelf tools which may not have the required specificity for a particular use-case.
It also flags a ‘no code’ focus, saying its tech has been designed with a non-technical user in mind.
As it’s an SDK, Mobius Labs’ platform can also be deployed on premise and/or on device — rather than the customer needing to connect to a cloud service to tap into the AI tool’s utility.
“Our custom training user interface is very simple to work with, and requires no prior technical knowledge on any level,” claims Appu Shaji, CEO and chief scientist.
“Over the years, a trend we have observed is that often the people who get the maximum value from AI are non technical personas like a content manager in a press and creative agency, or an application manager in the space sector. Our no-code AI allows anyone to build their own applications, thus enabling these users to get close to their vision without having to wait for AI experts or developer teams to help them.”
Mobius Labs — which was founded back in 2018 — now has 30 customers using its tools for a range of use cases.
Uses include categorisation, recommendation, prediction, reducing operational expense, and/or “generally connecting users and audiences to visual content that is most relevant to their needs”. (Press and broadcasting and the stock photography sector have unsurprisingly been big focuses to date.)
But it reckons there’s wider utility for its tech and is gearing up for growth.
It caters to businesses of various sizes, from startups to SMEs, but says it mainly targets global enterprises with major content challenges — hence its historical focus on the media sector and video use cases.
Now, though, it’s also targeting geospatial and earth observation applications as it seeks to expand its customer base.
The 30-strong startup has more than doubled in size over the last 18 months. With the new funding it’s planning to double its headcount again over the next 12 months as it looks to expand its geographical footprint — focusing on Europe and the US.
Year-on-year growth has also been 2x but it believes it can dial that up by tapping into other sectors.
“We are working with industries that are rich in visual data,” says Shaji. “The geospatial sector is something that we are focussing on currently as we have a strong belief that vast amounts of visual data is being produced by them. However, these huge archives of raw pixel data are useless on their own.
“For instance, if we want to track how river fronts are expanding, we have to look at data collected by satellites, sort and tag them in order to analyse them. Currently this is being done manually. The technology we are creating comes in a lightweight SDK, and can be deployed directly into these satellites so that the raw data can be detected and then analysed by machine learning algorithms. We are currently working with satellite companies in this sector.”
On the competitive front, Shaji names Clarifai and Google Cloud Vision as the main rivals it has in its sights.
“We realise these are the big players but at the same time believe that we have something unique to offer, which these players cannot: Unlike their solutions, our platform users can be outside the field of computer vision. By democratising the training of machine learning models beyond simply the technical crowd, we are making computer vision accessible and understandable by anyone, regardless of their job titles,” he argues.
“Another core value that differentiates us is the way we treat client data. Our solutions are delivered in the form of a Software Development Kit (SDK), which runs on-premise, completely locally on clients’ systems. No data is ever sent back to us. Our role is to empower people to build applications, and make them their own.”
Computer vision startups have been a hot acquisition target in recent years and some earlier startups offering ‘computer vision as a service’ got acquired by IT services firms to beef up their existing offerings, while tech giants like Amazon and (the aforementioned) Google offer their own computer vision services too.
But Shaji suggests the tech is now at a different stage of development — and primed for “mass adoption”.
“We’re talking about providing solutions that empower clients to build their own applications,” he says, summing up the competitive play. “And that [do that] with complete data privacy, where our solutions run on-premise, and we don’t see our clients data. Coupled with that is the ease of use that our technology offers: It is a lightweight solution that can be deployed on many ‘edge’ devices like smartphones, laptops, and even on satellites.”
Commenting on the funding in a statement, Stephan Wirries, partner at Ventech VC, added: “Appu and the team at Mobius Labs have developed an unparalleled offering in the computer vision space. Superhuman Vision is impressively innovative with its high degree of accuracy despite very limited required training to recognise new objects at excellent computational efficiency. We believe industries will be transformed through AI, and Mobius Labs is the European Deep Tech innovator teaching machines to see.”
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Singapore-based caregiving startup Homage raises $30M Series C
Homage, the caregiving-focused startup, has raised a $30 million Series C led by Sheares Healthcare Group, which is wholly-owned by investment firm Temasek. Other participants included new investors DG Daiwa Ventures and Sagana Capital, and returning backers East Ventures (Growth), HealthXCapital, SeedPlus, Trihill Capital and Alternate Ventures.
The new funding will be used to develop Homage’s technology, continue integrating with aged and disability care payer and provider infrastructure and speed-up its regional expansion through partnerships with hospitals and care providers. Homage currently operates in Singapore, Malaysia and Australia.
The Singapore-based company’s services include home visits from caregivers, nurses, therapists and doctors; telemedicine; and services for chronic illnesses. One of the reasons Homage’s platform is able to scale up is its matching engine, which helps clients, like older adults and people living with chronic conditions, find providers who are best suited to their needs (the final matches are made by Homage’s team).
The startup says the round was oversubscribed and one of the largest fundings raised by an on-demand care platform in Southeast Asia and Oceania so far. It brings Homage’s total raised to more than $45 million.
As part of Series C, Sheares Healthcare Group chief corporate development officer Khoo Ee Ping will join Homage’s board of directors.
Homage now has a regional network of more than 6,000 pre-screened and trained care professionals. It claims that its business outside of Singapore has grown more than 600% year-over-year in 2021, and it has more than tripled revenue over the past year.
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Quantum Machines plans to expand quantum orchestration platform with $50M investment
Quantum Machines, an Israeli startup that is building the classical hardware and software infrastructure to help run quantum machines, announced a $50 million Series B investment today.
Today’s round was led by Red Dot Capital Partners with help from Exor, Claridge Israel, Samsung NEXT, Valor Equity Partners, Atreides Management, LP, as well as TLV Partners, Battery Ventures, 2i Ventures and other existing investors. The company has now raised approximately $83 million, according to Crunchbase data.
While quantum computing in general is in its early days, Quantum Machines has developed a nice niche by building a hardware and software system, what they call The Quantum Orchestration Platform, that helps run the burgeoning quantum machines, leaving it plenty of room to grow as the industry develops.
Certainly Quantum Machines co-founder and CEO Itamar Sivan, who has been working in quantum his entire career, sees the vast potential of this technology. “Quantum computers have the promise of potentially speeding up very substantially computations that are impossible to complete in reasonable time with classical computers, and this is at the highest level the interest in the field right now. Our vision specifically at Quantum Machines is to make quantum computers ubiquitous and disruptive across all industries,” he said.
To achieve that, the company has created a system that relies on classical computers to power quantum computers as they develop. While the company has designed its own silicon for this purpose, it is important to note that it is not building quantum chips. As Sivan explains, the classical computer has a software and hardware layer, but quantum machines have three layers: “The quantum hardware, which is the heart, and on top of that you have classical hardware […] and then on top of that you have software,” he said.
“We focus on the two latter layers. So classical hardware and the software that drives it. Now at the heart of our hardware is in fact a classical processor. So this is I think one of the most interesting parts of the quantum stack,” he explained.
He says that this interaction between classical computing and quantum computing is one that is fundamental to the technology, and it’s a mix that will last well into the future, possibly forever. What Quantum Machines is building is essentially the classical cloud infrastructure required to run quantum computers.
Quantum Machines founding team: Itamar Sivan, Nissim Ofek, Yonatan Cohen. Photo Credit: Quantum Machines
So far the approach has been working quite well, as Sivan reports that governments, researchers, universities and the hyper scaler operators (which could include companies like Amazon, Netflix and Google, although the company has not said they are customers) are all interested in QM’s technology. While it isn’t discussing specific metrics, the company has customers in 15 countries at the moment and is working with some large entities that it couldn’t name.
The money from this round helps validate what the company is doing, enabling it to continue building out the solution, while also investing heavily in research and development, which is essential as the industry is still in early development and much will change over time.
They have been able to create this solution to this point with just 60 employees, and with the new funding should be able to build out the team in a substantial way in the coming years. He says that when it comes to diversity, he comes from an academic background where this is the norm and he has carried this forth to his company as he hires new people. What’s more, the pandemic has allowed him to hire from anywhere and he says that the company has taken advantage of this opportunity.
“First of all, we’re not hiring just in Israel, we’re hiring globally, and we’re not limited to hiring in specific geographies. We have people [from a number of countries],” he said. He adds, “Diversity for me personally means involving as many people as possible in hiring processes. That is the only way to ensure that there is diversity.”
Even throughout the pandemic, the hardware team has been meeting in person in the office with necessary precautions when it has been allowed, but most employees have continued to work from home, and that is an approach he will continue to take even when it’s safe to return to the office on a regular basis.
“Of course, work in a post-COVID era will include a substantial amount of remote work. […] So even in [our] headquarters, we anticipate allowing people to work remotely [if they wish].
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Make accessibility part of your startup’s products and culture from day one
The world of accessibility has experienced a tipping point thanks to the pandemic, which drove people of all abilities to do more tasks and shopping online.
For the last year, the digital world was the only place brands could connect with their customers. A Forrester survey found that 8 in 10 companies have taken their first steps toward working on digital accessibility.
What’s driving this change besides the increased digital interactions? Fortune 500 companies are finally starting to realize that people with disabilities make up 1 billion of the world’s market. That population and their families control more than $13 trillion in disposable income, according to Return on Disability’s “The Global Economics of Disability.”
However, only 36% of companies in Forrester’s survey are completely committed to creating accessible digital experiences.
Although digital accessibility has been around for decades, companies have not caught on to its benefits until recently. In its latest survey, the WebAIM Million analysis of 1 million home pages found accessibility errors on 97.4% of the websites evaluated.
What does this mean for you? Why should you care about this? Because this is an opportunity for your company to get ahead of the competition and reap the rewards of being an early adopter.
The benefits of digital accessibility
Companies are now realizing the advantages of creating accessible products and properties that go beyond doing the right thing. For one, people are living longer. The World Health Organization says people aged 60 and older outnumber children under 5. Moreover, the world’s population of those who are 60 and older is expected to reach 2 billion by 2050, up from 900 million in 2015.
W3C Web Accessibility Initiative provides an overview on Web Accessibility for Older Users. Here’s what it reveals.
- Hearing loss affects 47% of people aged 61 to 80.
- Vision decline affects 16% of people aged 65 to 74.
- Mild cognitive impairment affects 20% of people over 70.
- Arthritis affects more than 50% of people over 65.
In short, developing accessible digital products helps you reach a much larger audience, which will include you, your co-workers and your family. Everyone is going to become situationally, temporarily or episodically impaired at some point in their lives. Everyone enters a noisy or dark environment that can make it harder to see or hear. An injury or an illness can cause someone to use the internet differently on a temporary basis. People with arthritis, migraines and vertigo experience episodes of pain and discomfort that affect their ability to interact with digital devices, apps and tools.
Additionally, no one has ever advocated against making products and websites accessible to more people. Despite this, the relative universal appeal of accessibility as a principle does not mean that it will be as easy as explaining the need and getting people on board to make major organizational changes. A lot of work remains in raising awareness and educating people about why we need to make these changes and how to go about it.
You have the why. Now here are five things to help you with how to make changes in your company to integrate accessibility as a core part of your business.
1. Tap the right people to create accessible experiences
According to the second annual State of Accessibility Report, only 40% of the Alexa Top 100 websites are fully accessible, proving the needs of people with disabilities are, more often than not, being overlooked when creating web experiences.
To design for people with disabilities, it’s important to have an understanding of how they use your products or web properties. You’ll also want to know what tools will help them achieve their desired results. This starts with having the right people on board.
Hiring accessibility experts to advise your development team will proactively identify potential issues and ensure you design accessibly from the start, as well as create better products. Better yet, hiring people with disabilities brings a deeper level of understanding to your work.
2. Hire designers passionate about accessibility
Having accessibility experts on your team to provide advice and guidance is a great start. However, if the rest of your team is not passionate about accessibility, that can turn into a potential roadblock. When interviewing new designers, ask about accessibility. It’ll gauge a candidate’s knowledge and passion in the area. At the same time, you set an expectation that accessibility is a priority at your organization.
Being proactive about your hires and making sure they will contribute to a culture of accessibility and inclusion will save you major headaches. Accessibility starts in the design and user experience (UX) phase. If your team doesn’t deliver there, then you will have to fix their mistakes later, essentially delaying the project and costing your organization. It costs more to fix things than to build them accessibly in the first place.
3. Remember that accessibility is for everyone
People deciding whether to invest in accessibility often ask themselves how many people are going to use the feature. The reasoning behind the question is understandable from a business perspective; accessibility can be an expense, and it’s reasonable to want to spend money responsibly.
However, the question is rooted in one of the biggest misconceptions in the field. The myth is that accessibility only benefits people who are blind or deaf. This belief is frustrating because it greatly underestimates the number of people with disabilities and minimizes their place in society. Furthermore, it fails to acknowledge that people who may not have a disability still benefit greatly from accessibility features.
Disability is a spectrum that all of us will find ourselves on sooner or later. Maybe an injury temporarily limits our mobility that requires us to perform basic tasks like banking and shopping exclusively online. Or maybe our vision and hearing change as we age, which affects our ability to interact online.
When we understand that accessibility is about designing in a way that includes as many people as possible, we can reframe the conversation around whether it’s worth investing in. This approach sends a clear message: No business can afford to ignore a fast-growing population.
Think about it this way: If you have a choice of taking an elevator or the stairs, which would you take? Most pick the elevator. Those ramps on street corners called curb cuts? They were initially designed for allowing wheelchairs to cross the street.
Yet, many use these ramps, including parents pushing strollers, travelers pulling luggage, skateboarders rolling and workers moving heavy loads on dollies. A feature initially designed for accessibility benefits far more people than the original target audience. That’s the magic of the curb-cut effect.
4. Hire agencies that build accessibly by default
Whether you have a small team or are expanding an in-house accessibility practice, working with an agency can be an effective way to embrace and adopt accessible practices. The secret to a successful partnership is choosing an agency that will help your team grow into its accessibility practice.
The key to finding the right agency is selecting one that builds accessibly by default. When you know you are working with an agency that shares your organization’s values, you have a trusted partner in your mission of improving accessibility. It also removes any guesswork or revisions down the line. This is a huge win, as many designers overlook details that can make or break an experience for a user with a disability.
Working with an agency focused on providing accessible experiences narrows the likelihood of errors going unnoticed and unremedied, giving you confidence that you are providing an excellent experience to your entire audience.
5. Integrate accessibility into your supply chain
On any given day, enterprises and large organizations often work with dozens of stakeholders. From vendors and agencies to freelancers and internal employees, the nature of business today is far-reaching and collaborative. While this is valuable for exchanging ideas, accessibility can get lost in the mix with so many different people involved.
To prevent this from happening, it’s important to align these moving pieces of a business into a supply chain that is focused on accessibility at every stage of the business. When everyone is completely bought in, it cuts the risk of a component being inaccessible and causing issues for you in the future.
The startup advantage
A major challenge that comes up repeatedly is the struggle to change the status quo. Once an organization implements and ingrains inaccessible processes and products into its culture, it is hard to make meaningful change. Even if everyone is willing to commit to the change, the fact is, rewriting the way you do business is never easy.
Startups have an advantage here: They do not bear years of inaccessible baggage. It’s not written into the code of their products. It’s not woven into the business culture. In many ways, a startup is a clean slate, and they need to learn from the trials of their more established peers.
Startup founders have the opportunity to build an accessible organization from the ground up. They can create an accessible-first culture that will not need rewriting 10, 20 or 30 years from now by hiring a diverse workforce with a passion for accessibility, writing accessible code for products and web properties, choosing to work with only third parties who embrace accessibility and advocating for the rights of people with disabilities.
Many of these considerations here have a common denominator: culture. While most people in the technology industry will agree that accessibility is an important and worthy cause to champion, it has a huge awareness problem.
Accessibility needs to be everywhere in software development, from requirements and beyond to include marketing, sales and other non-tech teams. It cannot be a niche concern left to a siloed team to handle. If we, as an industry and as a society, recognize that accessibility is everyone’s job, we will create a culture that prioritizes it without question.
By creating this culture, we will no longer be asking, “Do we have to make this accessible?” Instead, we’ll ask, “How do we make this accessible?” It’s a major mindset shift that will make a tangible difference in the lives of 1 billion people living with a disability and those who eventually will have a disability or temporary, situational or episodic impairments affecting their ability to use online and digital products.
Advocating for accessibility may feel like an uphill battle at times, but it isn’t rocket science. The biggest need is education and awareness.
When you understand the people you build accessible products for and the reasons they need those products, it becomes easier to secure buy-in from people in all parts of your organization. Creating this culture is the first step in a long quest toward accessibility. And the best part is, it gets easier from here.
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