Startups
Auto Added by WPeMatico
Arbolus raises $6M from Fuel Ventures and Plug and Play to apply ML to expert knowledge
Leveraging networks of “experts” online started out as a very manual online business. But it’s rapidly becoming more efficient as machine learning is applied to the whole business model. Indeed, in the U.K. alone $60 billion is spent a year on using outside expertise. Large players in this space include GLG, Third Bridge, Guidepoint and AlphaSights. And we saw recently that proSapient has raised $18 million for its SaaS platform for managing expert networks.
Now Barcelona-based Arbolus has raised a $6 million funding round led by early-stage U.K. VC Fuel Ventures, in addition to Plug and Play Ventures, better known in Silicon Valley.
The three-year old startup claims it has seen a 7x growth YoY and now has offices in Barcelona and New York. It’s also appointed Pau Beltran at CTO, who was formerly of Disney, eDreams, OneMind and others.
Arbolus’ approach to “enterprise knowledge,” as it’s known, is employing natural language processing and an AI backbone to its platform.
Whereas proSapient uses technology to make expert sourcing more efficient, Arbolus captures recordings of expert interviews, transcribes them on its platform and then shares that knowledge within companies’ networks that subscribe to the platform.
Companies using the platform pay fees to actually use the software, and use all of the toolsets that are on there. It also makes transaction fees when companies pay independent experts on its platform.
Sam Glasswell, CEO and co-founder of Arbolus, said in a statement: “Having the right information gives you a competitive edge but the typical means of engaging with experts through one-hour calls alone is failing to deliver value. These interviews are usually held by a single department and their findings end up lost in PowerPoint presentations or reports. Therefore, companies are only building up a short-term view. We are bringing innovation to the ways companies are working with external experts by using groundbreaking technology to, not just build expertise within organizations, but deliver it in ways that are digestible, searchable and, most importantly, usable for the months and years ahead across different departments.”
Mark Pearson, managing partner from Fuel Ventures, added: “Arbolus have done amazing things in its first 24 months and it’s a testament to the entrepreneurial ambition of Sam and Will backed up by their experience of helping to scale a $1 billion company in their former lives.”
Arbolus says it is working with more than 80 customers, including Big Four firms such as KPMG, and startups like UiPath.
Founders Sam Glasswell and Will Leeming scaled an expert agency before this startup and realized a lot of knowledge was being lost in these expert networks because it simply wasn’t being captured in the right way. And they decided to base the company in Barcelona because it was able to attract talent and had all the advantages of being in the EU.
Glasswell told me: “In Barcelona we have an awesome office, our own space, a great team it’s certainly a beautiful city, and we’re able to attract really really top talent. I mean, people will move from anywhere in the world to go to Barcelona. It’s probably been one of the biggest success factors for us so far. Does the EU factor, help? Yes, I mean the fact that is in the EU in the trading bloc of the union does help… and we thought we’d just be able to build a much more culturally diverse team in the long run.”
Certainly, the future of work looks like it is shifting toward one where outside experts are used more and more by companies. If the gig economy has affected your pizza delivery, it’s also affecting the knowledge economy.
Powered by WPeMatico
Ketch raises $23M to automate privacy and data compliance
Ketch, a startup aiming to help businesses navigate the increasingly complex world of online privacy regulation and data compliance, is announcing that it has raised $23 million in Series A funding.
The company is also officially coming out of stealth. I actually wrote about Ketch’s free PrivacyGrader tool last year, but now it’s revealing the broader vision, as well as the products that businesses will actually be paying for.
The startup was founded by CEO Tom Chavez and CTO Vivek Vaidya. The pair previously founded Krux, a data management platform acquired by Salesforce in 2016, and Vaidya told me that Ketch is the answer to a question that they’d begun to ask themselves: “What kind of infrastructure can we build that will make our former selves better?”
Chavez said that Ketch is designed to help businesses automate the process of remaining compliant with data regulations, wherever their visitors and customers are. He suggested that with geographically specific regulations like Europe’s GDPR in place, there’s a temptation to comply globally with the most stringent rules, but that’s not necessary or desirable.
“It’s possible to use data to grow and to comply with the regulations,” Chavez said. “One of our customers turned off digital marketing completely in order to comply. This has got to stop […] They are a very responsible customer, but they didn’t know there are tools to navigate this complexity.”
Image Credits: Ketch
The pair also suggested that things are even more complex than you might think, because true compliance means going beyond the “Hollywood façade” of a privacy banner — it requires actually implementing a customer’s requests across multiple platforms. For example, Vaidya said that when someone unsubscribes to your email list, there’s “a complex workflow that needs to be executed to ensure that the email is not going to continue … and make sure the customer’s choices are respected in a timely manner.”
After all, Chavez noted, if a customer tells you, “I want to delete my data,” and yet they keep getting marketing emails or targeted ads, they’re not going to be satisfied if you say, “Well, I’ve handled that in the four walls of my own business, that’s an issue with my marketing and email partners.”
Chavez also said that Ketch isn’t designed to replace any of a business’ existing marketing and customer data tools, but rather to “allow our customers to configure how they want to comply vis-à-vis what jurisdiction they’re operating in.” For example, the funding announcement includes a statement from Patreon’s legal counsel Priya Sanger describing Ketch as “an easily configurable consent management and orchestration system that was able to be deployed internationally” that “required minimal engineering time to integrate into our systems.”
As for the Series A, it comes from CRV, super{set} (the startup studio founded by Chavez and Vaidya), Ridge Ventures, Acrew Capital and Silicon Valley Bank. CRV’s Izhar Armony and Acrew’s Theresia Gouw are joining Ketch’s board of directors.
And if you’d like to learn more about the product, Ketch is hosting a webinar at 11am Pacific today.
Powered by WPeMatico
Bevy raises $40M Series C with 20% coming from Black investors
You might expect that a startup that makes community building software would be thriving during a pandemic when it’s so difficult for us to be together. And Bevy, a company whose product powers community sites like Salesforce Trailblazers and Google Developers announced it has raised a $40 million Series C this morning, at least partly due to the growth related to that dynamic.
The round was led by Accel with participation from Upfront Ventures, Qualtrics co-founder Ryan Smith and LinkedIn, but what makes this investment remarkable is that it included 25 Black investors representing 20% of the investment.
One of those investors, James Lowery, who is a management consultant and entrepreneur, and was the first Black employee hired at McKinsey in 1968, sees the opportunity for this approach to be a model to attract investment from other under-represented groups.
“I know for a fact because of my friendship and my network that there are a lot of people, if they had the opportunity to invest in opportunities like this, they will do it, and they have the money to do it. And I think we can be the model for the nation,” Lowery said.
Unfortunately, there has been a dearth of Black VC investment in startups like Bevy. In fact, only around 3% of venture capitalists are Black and 81% of VC firms don’t have a single Black investor.
Kobie Fuller, who is general partner at investor Upfront Ventures, a Bevy board member and runs his own community called Valence, says that investments like this can lead to a flywheel effect that can lead to increasing Black investment in startups.
“So for me, it’s about how do we get more Black investors on cap tables of companies early in their lifecycle before they go public, where wealth can be created. How do we get key members of executive teams being Black executives who have the ability to create wealth through options and equity. And how do we also make sure that we have proper representation on the boards of these companies, so that we can make sure that the CEOs and the C suite is held accountable towards the diversity goals,” Fuller said.
He sees a software platform like Bevy that facilitates community as a logical starting point for this approach, and the company needs to look like the broader communities it serves. “Making sure that our workforce is appropriately represented from a perspective of having appropriate level of Black employees to the board to the actual investors is just good business sense,” he said.
But the diversity angle doesn’t stop with the investor group. Bevy CEO and co-founder Derek Anderson says that last May when George Floyd was killed, his firm didn’t have a single person of color among the company’s 27 employees and not a single Black investor in his cap table. He wanted to change that, and he found that in diversifying, it not only was the right thing to do from a human perspective, it was also from a business one.
“We realized that if we really started including people from the Black and brown communities inside of Bevy that the collective bar of a talent was going to go up. We were going to look from a broader pool of candidates, and what we found as we’ve done this is that as the culture has started to change, the customer satisfaction is going up, our profits and our revenues — the trajectory is going up — and I see this thing is completely correlated,” Anderson said.
Last summer the company set a two year goal to get to 20% of employees being Black. While the number of employees is small, Bevy went from zero to 5% in June, and 10% by September. Today it is just under 15% and expects to hit the 20% goal by summer, a year ahead of the goal it set last year.
Bevy grew out of a community called Startup Grind that Anderson started several years ago. Unable to find software to run and manage the community, he decided to build it himself. In 2017, he spun that product into a separate company that became Bevy, and he has raised $60 million, according to the company.
In addition to Salesforce and Google, other large enterprises are using Bevy to power their communities and events, including Adobe, Atlassian, Twilio, Slack and Zendesk.
Today, the startup is valued at $325 million, which is 4x the amount it was valued at when it raised its $15 million Series B in May 2019. It expects to reach $30 million in ARR by the end of this year.
Powered by WPeMatico
Berlin’s Blacklane raises $26M to expand its high-end chauffeur-driven sustainable car service
As the Ubers of the world continue to scale, a smaller on-demand transportation startup has raised some funding in Germany, underscoring the opportunities that remain for startups in the space targeting specific service niches. Blacklane — the Berlin startup that provides on-demand black-car chauffeur services in Berlin, London, Dubai, Los Angeles, New York, Paris, Singapore and 16 other cities — has closed a round of €22 million ($26 million at current rates). After taking a majority stake in Havn, the Jaguar-hatched electric car service in London, in February, Blacklane said that it will be using this latest round of funding to continue expanding sustainable travel initiatives, and to continue expanding its existing business with more flexible options for riding.
The funding, which is being made at an up round valuation, is a sign of how the company is showing signs of growth after a year in which monthly revenues dropped 99% in the wake of the COVID-19 pandemic and the resulting drop in travel, and specifically people willing to be in small spaces that are shared with others.
“The global travel and mobility industries have suffered, with several players struggling between drastic cuts, hibernation or ceasing operations. Blacklane has taken the opportunity to cater to travelers’ emerging needs,” said Dr. Jens Wohltorf, CEO and co-founder of Blacklane, in a statement. “Thanks to this financing, we will continue to fast-track our innovation, with zero layoffs.”
The company said that the investment is coming from existing investors German automotive giant Daimler, the UAE’s ALFAHIM Group and btov Partners. And while it is coming at an up round, Blacklane is not disclosing any figures, nor has it ever disclosed valuation. Previous backers of the company also include the strategic investment arm of Recruit Holdings, the Japanese HR giant, and it has raised around $100 million to date, including a round of about $45 million in 2018.
The funding is coming after what has been an extremely rough year for travel and transportation startups due to the COVID-19 pandemic, with Blacklane itself seeing monthly revenues drop 99% after the pandemic hit last year, the company tells me.
Some others in the space that diversified into other areas like food delivery or other kinds of transport (e.g. bikes or scooters) were able to offset declines in their more core ride-hailing services, which in the meantime were repositioned as a safer alternative to public transportation. Blacklane, however, had never positioned itself as a ride for “everyman” — its core use case were higher-end rides and airport trips (which had also died a death) — so when movement shut down, Blacklane’s business nosedived.
It was particularly bad timing for Blacklane, considering that in the lead up to the pandemic, it looked to be on course to turn a profit on its focused model. (While financials for 2020 will take a while to be posted, the most recent results for the company showed a net loss of about $18 million in 2018.)
The reason that Blacklane has managed to raise at an up round tells another side of the story, however.
As companies in transport and travel gingerly started to show the smaller signs of recovery last summer, so too did Blacklane. It coupled that with the first steps of diversification itself.
Earlier this month, it added “chauffeur hailing” in 22 cities, an on-demand service that reduced the lead time for an order to under 30 minutes (its previous service was based on more advanced bookings). It also changed its pricing structure to get more competitive on shorter distances, since so many of the airport rides that were the basis of its revenues have yet to return.
In addition to that, Blacklane took a majority stake in Havn, an electric-based car service hatched by Jaguar, for an undisclosed sum, to spearhead a move into more sustainable travel options alongside the fleet of Teslas already operated by Blacklane.
“Worldwide travel restrictions give us a one-time chance to reset our expectations for safe and sustainable trips,” said Wohltorf in a statement. “Blacklane will recover responsibly and continue to grow while caring for both people and the planet.”
Powered by WPeMatico
Feedzai raises $200M at a $1B+ valuation for AI tools to fight financial fraud
On the heels of Jumio announcing a $150 million injection this week to continue building out its AI-based ID verification and anti-money laundering platform, another startup in the space is levelling up. Feedzai, which provides banks, others in the financial sector, and any company managing payments online with AI tools to spot and fight fraud — its cornerstone service involves super-quick (3 millisecond) checks happening in the background while transactions are being made — has announced a Series D of $200 million. It said that the new financing is being made at a valuation of over $1 billion.
The round is being led by KKR, with Sapphire Ventures and strategic backer Citi Ventures — both past investors — also participating. Feedzai said it will be using the funds for further R&D and product development, to expand into more markets outside the U.S. — it was originally founded in Portugal but now is based out of San Mateo — and towards business development, specifically via partnerships to integrate and sell its tools.
One of those partners looks to be Citi itself:
“Citi is committed to advancing global payments anchored on transparency, efficiency, and control, and our partnership with Feedzai is allowing us to provide customers with technology that seamlessly balances agility and security,” said Manish Kohli, global head of Payments and Receivables, with Citi’s Treasury and Trade Solutions, in a statement.
This latest round comes nearly four years after Feedzai raised its Series C, a $50 million round led by an unnamed investor and with an undisclosed valuation. Sapphire also participated in that round. It has now raised some $182 million to date.
Feedzai’s funding is happening at a time when the need for fraud protection for those managing transactions online has reached a high watermark, leading to a rush of customers for companies in the field.
Feedzai says that its customers include four of the five largest banks in North America, 80% of the world’s Fortune 500 companies, 154 million individual and business taxpayers in the U.S., and has processed $9 billion in online transactions for two of the world’s most valuable athletic brands. In total its reach covers some 800 million customers of businesses that use its services.
In addition to Citibank, its customers include Fiserv, Santander, SoFi and Standard Chartered’s Mox.
While money laundering, fraud and other kinds of illicit financial activity were already problems then, in the interim, the problem has only compounded, not least because of how much activity has shifted online, accelerating especially in the last year of pandemic-driven lockdowns. That’s been exacerbated also by a general rise in cybercrime — of which financial fraud remains the biggest component and motivator.
Within that bigger trend, solutions based on artificial intelligence have really emerged as critical to the task of identifying and fighting those illicit activities. Not only is that because AI solutions are able to make calculations and take actions and simply process more than non-AI based tools, or humans for that matter, but they are then able to go head to head with much of the fraud taking place, which itself is being built out on AI-based platforms and requires more sophistication to identify and combat.
For banking customers, Feedzai’s approach has been disruptive in part because of how it has conceived of the problem: It has built solutions that can be used across different scenarios, making them more powerful since the AI system is subsequently “learning” from more data. This is in contrast to how many financial service providers had conceived and tackled the issue in the past.
“Until now banks have used solutions based on verticals,” Nuno Sebastiao, co-founder and CEO of Feedzai, said in the past to TechCrunch. “The fraud solution you have for an ATM wouldn’t be the same fraud solution you would use for online banking which wouldn’t be the same fraud solution you would have for a voice call center.” As these companies have refreshed their systems, many have taken a more agnostic approach like the kind Feedzai has built.
The scale of the issue is clear, and unfortunately also something many of us have experienced firsthand. Feedzai says its data indicates that the last quarter of 2020 shows consumers saw a 650% increase in account takeover scams, a 600% in impersonation scams and a 250% increase in online banking fraud attacks versus the first quarter of 2020. (Those periods are, essentially, before-pandemic and during-pandemic comparisons.)
“The past 12 months have accelerated the world’s dependency on electronic financial services – from online banking to mobile payments, and in turn have increased fraud and money laundering activity. Our services are in more demand than ever,” said Sebastiao in a statement today.
Indeed, yesterday, when I covered Jumio’s $150 million round, I said I wouldn’t consider its funding to be an outlier (even though Jumio made clear it was the largest funding to date in its space): the fast follow from Feedzai, with an even higher amount of financing, really does underscore the trend at the moment.
In addition to these two, one of Feedzai’s biggest competitors, Kount, was acquired by credit ratings giant Equifax earlier this year for $640 million to move deeper into the space. (And related to that field, in the area of identity management, which goes hand-in-hand with tools for laundering and fraud, Okta acquired Auth0 for $6.5 billion.)
Other big rounds for startups in the wider space have included ForgeRock ($96 million round), Onfido ($100 million), Payfone ($100 million), ComplyAdvantage ($50 million), Ripjar ($36.8 million) Truework ($30 million), Zeotap ($18 million) and Persona ($17.5 million).
KKR’s involvement in this round is notable as another example of a private equity firm getting in earlier with venture rounds with fast-scaling startups, similar to Great Hill’s investment in Jumio yesterday and a number of other examples. The firm says it’s making this investment out of its Next Generation Technology Growth Fund II, which is focused on making growth equity investment opportunities in the technology space.
“Feedzai offers a powerful solution to one of the biggest challenges we are facing today: financial crime in the digital age. Global commerce depends on future-proof technologies capable of dealing with a rapidly evolving threat landscape. At the same time, consumers rightfully demand a great customer experience, in addition to strong security layers when using banking or payments services,” said Stephen Shanley, managing director at KKR, in a statement
“We believe Feedzai’s platform uniquely meets these expectations and more, and we are looking forward to working with Nuno and the rest of the team to expand their offering even further,” added Spencer Chavez, principal at KKR.
Powered by WPeMatico
Our favorite companies from Y Combinator’s W21 Demo Day: Part 2
We’ve reached the end of Y Combinator’s biggest Demo Day, which saw more than 300 companies pitching back-to-back over eight hours.
Earlier, we highlighted some of the companies that caught our eye in the first half of the day. Now we’re back with our favorite companies from the second half. From a marketplace to help you resell formalwear to a startup that offers self-driving street cleaners, it’s quite the mix.
If you’d like to browse all of the companies from this batch YC has a catalog of publicly-launched W21 companies here.
Terra
Heading into this particular demo day, I had my eyes peeled for startups focused on delivering services via an API instead of offering managed software. Happily, there have been a number to dig into, including Pitbit.ai, Bimaplan, Enode and Terra.
Terra stood out to me because it solves a problem I care deeply about, namely fitness data siloization. My running data is stuck in one app, biking data in another, and my weight-lifting data is stuck in my head, though I doubt Terra has an API for that interface quite yet.
What Terra does is permit fitness app developers to better connect their services, which permits the sharing of data back and forth. Presenters likened their startup to Plaid — a popular thing to do in recent quarters — saying that what the fintech startup did for banking data, Terra would do for fitness and health information.
Getting developers to sign on will be tricky, as I presume all of the apps I use in an exercise context would prefer to be my main workout home. But I don’t want that, so here’s hoping Terra realizes its vision.
— Alex
AgendaPro
Calling itself “Shopify for beauty and wellness” in Latin America, AgendaPro wants to help small businesses in the region book customers online and collect payments.
The company’s idea isn’t as radical as some companies that we heard from today — Carbon capture! Faster drug discovery! — but the company did share several metrics that made us sit up. First, AgendaPro has reached $152,000 in MRR, or just over $1.8 million in ARR. And representatives shared that its gross margins are 89%. As far as software margins goes, that’s pretty damn good.
The startup has more than 3,000 merchants using its service at the moment, and it claims that there are more than four million businesses that it could service. If AgendaPro can get software and payments revenues from even a respectable fraction of those companies, it will be a big, big business. And who doesn’t love vertical SaaS?
— Alex
Atom Bioworks
One of the holy grails of biochemistry is a programmable DNA machine. These tools can essentially “code” a molecule so that it reliably sticks to a specific substance or cell type, which allows a variety of follow-up actions to be taken.
For instance, a DNA machine could lock onto COVID-19 viruses and then release a chemical signal indicating infection before killing the virus. The same principle applies to a cancer cell. Or a bacterium. You get the picture — and it looks like Atom Bioworks has something a lot like this.
Powered by WPeMatico
Cross-border fintech Airwallex raises $100M Series D extension at new valuation of $2.6B
Airwallex, the fintech company for cross-border businesses, announced today it has added $100 million more to its Series D round, bumping its valuation up to $2.6 billion. The extension was led by Greenoaks, with participation from Grok Ventures and returning investors Skip Capital and ANZi Ventures.
Co-founder and chief executive officer Jack Zhang told TechCrunch that the new funding will be used for Airwallex’s United States launch in the second quarter of this year, expand its payment coverage to new regions like the Middle East, Africa, Eastern Europe and Latin America, and add more products, including physical cards.
This latest extension brings Airwallex’s Series D round to $300 million, and total equity raised so far to $500 million. Airwallex first announced its Series D in April 2020 after raising $160 million, then another tranche that added $40 million in September 2020.
Airwallex reached unicorn valuation after its Series C in March 2019. The company was founded in Melbourne in 2015, and now has more than 600 employees across 12 offices in Australia, China, Hong Kong, the United Kingdom, Japan and the United States. In its announcement today, Airwallex said it is also hiring for more than 500 positions.
Airwallex’s products for cross-border businesses include foreign currency accounts and multi-currency debit cards with Visa, international money transfers and a suite of APIs that allow companies to do things like accept and manage international payments, and manage their foreign exchange risk.
Powered by WPeMatico
Y Combinator widens its bet in edtech in latest batch
Y Combinator is slowly growing its stake in education companies, as the sector balloons with newfound demand from remote learners. In its latest batch, the famed accelerator had its highest number of edtech startups yet: 14 companies from around the world, working on everything from teacher monetization to homework apps to ways to train software engineers in an affordable fashion.
While Y Combinator isn’t the definitive source on what success in early-stage startups looks like — it quite literally has a post-mortem dinner after Demo Day to celebrate failure — it does serve well in providing an illustrative glance of how entrepreneurs are thinking about certain sectors in a given moment in time. Managing director Michael Seibel said that the number of startups in each sector isn’t a Y Combinator choice, but is in line with the concentration of applicants in each sector. In other words, YC is backing more edtech companies because more edtech companies are applying to the accelerator.
One dynamic worth pointing out here is that, of the 14 edtech startups in this batch, only two have a woman founder, UPchieve and Degrees of Freedom. Y Combinator provided aggregate batch diversity, stating that 19% of companies in W21 include a woman founder, and 10% of founders in the entire batch are women. It’s a slight uptick from the last batch, but not an immense jump.
diversity of the @ycombinator w21 batch:
19% of the companies have a woman founder (16% S20)
— natasha (@nmasc_) March 23, 2021
With this context, I will use the current edtech cohort within the batch to sketch out one version of the future of education in the eyes of this specific demographic of early-stage founders.
Internationalization is a factor
The current YC batch has 50% of its startups based outside of the United States, a first for the accelerator. The growing internationalization of Y Combinator might help partially explain the uptick in edtech companies. The growth of companies like India’s Byju’s, one of the most valuable edtech companies in the world, shows how consumer spending in education companies internationally is impressive, and it’s clear that early-stage edtech startups are taking note.
Only two of Y Combinator’s 14 edtech investments are from the United States, with the highest concentrations in South America and India.
- Manara: A marketplace to connect Middle East talent to tech jobs.
- Prendea: Peru-based startup that offers live, online after-school classes for Spanish-speaking kids.
- Avion School: The education startup teaches Filipino students to be remote software engineers around the world.
- Poliglota: A language school for Latin America.
The future is consumer over B2B
The vast majority of startups in the current edtech batch charge consumers, instead of institutions or enterprises, for services. In some ways, edtech startups going for consumers instead of institutions isn’t new: it’s always been easier to convince a parent instead of a public school to pay for a service simply due to red tape. Consumers are an easier way to reach a venture-demanded scale, and that’s always been a truth of edtech.
- Kidato: Targeting the middle class of Africa, Kidato is an online school for K-12 students. The startup has a focus on quality and affordability.
- Codingal: An afterschool program for Indian kids to learn coding.
Still, it’s noteworthy that we’re not seeing too much experimentation in business model here, despite the pandemic and that some schools have begun to invest more in edtech services.
A potential hurdle that these companies might face is access. If it costs to use your service, you can only educate so many people from specific income groups. As a result, income share agreements, or ISAs, were especially present in this batch, a set-up that allows a student to hold off on paying for an education until they are employed. Upon employment, said student has to give a percentage of their income to the company until their debt is paid. While the model is controversial, it was popularized by YC graduate Lambda School and continues to be one way to make the upfront cost of school more popular.
- Pragmatic Leaders: The startup wants to build a more cost-effective MBA, which is free until the student is hired post-grad.
- Awari: The São Paulo-based startup uses income share agreements to help students in Brazil afford a tech education. Courses range from data analytics to product UX and growth marketing.
Acadpal, mentioned later, is an outlier here selling to schools in India. Before I move on to our next section, I do want to shout out two startups that I think embody the most ambitious bets in business model:
- UPchieve: A nonprofit for low-income high school students to access free, 24/7 virtual tutoring.
- Degrees of Freedom: The startup wants to offer low-cost higher education experience that is flexible and community-oriented. It costs about $9,000 to attend.
Zoom University lives on
Despite the struggles of “Zoom University,” this batch of edtech founders clearly believe that the future of instruction is through online courses. This was perhaps the most overwhelming thread tying together all the companies in the sector: a bet on one of these companies is a bet that remote education will become status quo.
As previous sections show, a number of startups are offering online coding platforms for specific demographics. Now, I always have my inbox filled with different “Lambda School for X” startups, so seeing a variety of these startups pop up yet again isn’t exactly exciting. However, the pandemic did show how much community and network enhances a school experience. If these online schools can pull off strong partnerships with employers and alumni, I think there’s a huge opportunity here.
- Turing College: The Lithuania-based online data science school uses income-share agreements to bring affordability to education.
- Coderhouse: An Argentina-based startup that wants to build a live, online tech education for the Spanish-speaking populations of the world.
That said, where there’s big opportunity there’s always a lot of competition. These startups will have to find a way to differentiate themselves, like the one below:
- Unschool: The startup wants to tie higher education to employment outcomes, so it’s building a platform to increase completion rates in India with a guarantee of internships.
There were bets on the infrastructure of how courses get done online, from course creation to completion.
- Pensil: A platform that helps YouTube teachers in India monetize their courses.
- Acadpal: A learning app for teachers in India to create and share homework, and for students to complete and discuss assignments.
- CreatorOS – Questbook: This company wants to make it easier for teachers to teach online courses. It gives professionals the tools they need to launch a course within minutes, with a focus on a bite-sized end-product.
In conclusion
To end, the edtech startups in the current YC batch are more complementary to each other than competitive. For a homework platform like Acadpal to succeed, it would be good news for a company like Codingal, which helps bring afterschool learning online, to get funding as well. For Unschool, which ties higher-ed to employment, a company like Degrees of Freedom could be a key partner or integration for students from a low-income background.
Edtech is growing — and fast — so the fragmentation of different plays is somewhat expected. And while this batch’s hard work starts now, it’s illuminating to understand where the earliest entrepreneurs out there are seeing promise.
Powered by WPeMatico
Our favorite companies from Y Combinator’s W21 Demo Day: Part 1
It’s that time again! Today is Demo Day for Y Combinator’s latest accelerator batch — its largest to date, with more than 300 teams getting a minute each to pitch their companies to an audience of investors.
This is the third time YC has held its Demo Day via a Zoom livestream and the second time the entire program was entirely virtual. YC president Geoff Ralston outlined their thinking for this latest batch — and how/why they’ve expanded the program to over 300 companies — in a post this morning.
Want to see all of the companies? YC has a catalog of the entire Winter 2021 batch here (minus those that haven’t publicly launched), filterable by industry and region.
If you don’t have time to skim through it all, we’ve aggregated some of the companies that really managed to catch our eye. This is part one of two, covering our favorites from the companies that launched in the first half of the day.
As Alex Wilhelm put it last time we did one of these, “we’re not investors, so we’re not pretending to sort the unicorns from the goats.” But we do spend a lot of time talking with startups, hearing pitches and telling their stories; if you’re curious about which companies stood out, read on.
Prospa
Prospa is building a neobank for small companies in Nigeria. The startup charges customers $7 per month and has reached $50,000 in monthly recurring revenue. That’s some pretty darn good traction. We found Prospa notable because Nigeria’s economy and population are rapidly growing, neobanks have succeeded in a number of markets thus far, and the company’s clear business model and early traction stood out.
And Prospa isn’t targeting a small market. It said during its presentation that there are 37 million so-called “microbusinesses” in its target country. That’s a lot of scale to grow into, and it’s really nice to hear from a neobank that isn’t going to merely pray that interchange revenues will eventually stack to the moon.
— Alex
Blushh
Image Credits: Blushh
Blushh, built by a team of ex-Google, Amazon, Harvard and BCG professionals, is creating a directory of short, sensual audio stories for women in Asia. The startup believes that there is a massive unmet need for adult content created for women, instead of men, signing up 100 paying subscribers within its first month on the market.
During their pitch, co-founder Soy Hwang said Blushh wants to do for sexual wellness what “Spotify and Audible did for music and audio books.” This startup stands out because it is taking on an untapped market ridden with stigma and lack of innovation. It’s a risk on several levels, and considering the fact that many venture capitalists today still have a “vice” clause that prevents them from investing in sex tech, it will be key to see how Blushh funds itself to keep growing.
— Natasha
BrioHR
TechCrunch caught up with BrioHR a few weeks ago when the startup announced that it had closed a $1.3 million round. During its presentation, the company announced that it had reached $13,000 in monthly recurring revenue (MRR), or $156,000 in annual recurring revenue (ARR).
The company is building human resources software for companies in Southeast Asia, a market it considers fraught with old software and outdated business processes. The company is doing two things. First, building software to help manage and pay workers. The latter part of its work requires lots of localization, so it’s rolling out more slowly than the rest of its software.
If Southeast Asia is as fertile ground for modern HR software as the United States has been shown to be, BrioHR could find more than enough room to grow. I’m excited to see how far the company can scale its ARR with the round that we recently covered.
— Alex
Charge Running
Strava walked so Charge Running could, well, run. The startup, founded by a former Navy SEAL, app connoisseur and kinesiology specialist, is an app that offers live virtual running classes. The consumer play is being framed by the team as a “Peloton for running” with motivation and social engagement during the run.
Powered by WPeMatico
This Y Combinator startup is taking lab-grown meat upscale with elk, lamb and Wagyu beef cell lines
Last week a select group of 20 employees and guests gathered at an event space on the San Francisco Bay, and, while looking out at the Bay Bridge, dined on a selection of choice elk sausages, Wagyu meatloaf and lamb burgers — all of which were grown from a petri dish.
The dinner was a coming out party for Orbillion Bio, a new startup pitching today in Y Combinator’s latest demo day, that’s looking to take lab-grown meats from the supermarket to high-end, bespoke butcher shops.
Instead of focusing on pork, chicken and beef, Orbillion is going after so-called heritage meats — the aforementioned elk, lamb and Wagyu beef to start.
By focusing on more expensive-end products, Orbillion doesn’t have as much pressure to slash costs as dramatically as other companies in the cellular meat market, the thinking goes.
But there’s more to the technology than its bougie beef, elite elk and luscious lamb meat.
“Orbillion uses a unique accelerated development process producing thousands of tiny tissue samples, constantly iterating to find the best tissue and media combinations,” according to Holly Jacobus, whose firm, Joyance Partners, is an early investor in Orbillion. “This is much less expensive and more efficient than traditional methods and will enable them to respond quickly to the impressive demand they’re already experiencing.”
The company runs its multiple cell lines through a system of small bioreactors. Orbillion couples that with a high throughput screening and machine learning software system to build out a database of optimized tissue and media combinations. “The key to making lab grown meat work scalably is choosing the right cells cultured in the most efficient way possible,” Jacobus wrote.
Orbillion is co-founded by a deeply technical and highly experienced team of executives that’s led by Patricia Bubner, a former researcher at the German pharmaceutical giant Boehringer Ingelheim. Joining Bubner is Gabriel Levesque-Tremblay, a former director of the American Institute of Chemical Engineers, who was a post-doc at Berkeley with Bubner and serves as the company’s chief technology officer. Rounding out the senior leadership is Samet Yildirim, the chief operating officer and a veteran executive of Boehringer Ingelheim (he actually served as Bubner’s boss).
Orbillion Bio co-founders Gabriel Levesque-Tremblay, CTO; Patricia Bubner, CEO; and Samet Yildirim, COO. Image Credit: Orbillion Bio
For Bubner, the focus on heritage meats is as much a function of her background growing up in rural Austria as it is about economics. A longtime, self-described foodie and a nerd, Bubner went into chemistry because she ultimately wanted to apply science to the food business. And she wants Orbillion to make not just meat, but the most delicious meats.
It’s an aim that fits with how many other companies have approached the market when they’re looking to commercialize a novel technology. Higher-end products, or products with unique flavor profiles that are unique to the production technologies available, are more likely to be commercially viable sooner than those competing with commodity products. Why focus on angus beef when you can focus on a much more delicious breed of animal?
For Bubner, it’s not just about making a pork replacement, it’s about making the tastiest pork replacement.
“I’m just fascinated and can see the future in us being able to further change the way we produce food to be more efficient,” she said. “We’re at this inflection point. I’m a nerd, I’m a foodie, and I really wanted to use my skills to make a change. I wanted to be part of that group of people that can really have an impact on the way we eat. For me there’s no doubt that a large percentage of our food will be from alternative proteins — plant based, fermentation and lab-grown meat.”
Joining Boehringer Ingelheim was a way for Bubner to become grounded in the world of big bioprocessing. It was preparation for her foray into lab-grown meat, she said.
“We are a product company. Our goal is to make the most flavorful steaks. Our first product will not be whole cuts of steak. The first product is going to be a Wagyu beef product that we plan on putting out in 2023,” Bubner said. “It’s a product that’s going to be based on more of a minced product. Think Wagyu sashimi.”
To get to market, Bubner sees the need not just for a new approach to cultivating choice meats, but a new way of growing other inputs as well, from the tissue scaffolding needed to make larger cuts that resemble traditional cuts of meat, or the fats that will need to be combined with the meat cells to give flavor.
That means there are still opportunities for companies like Future Fields, Matrix Meats and Turtle Tree Scientific to provide inputs that are integrated into the final, branded product.
Bubner’s also thinking about the supply chain beyond her immediate potential partners in the manufacturing process. “Part of my family were farmers and construction workers and the others were civil engineers and architects. I hold farmers in high respect… and think the people who grow the food and breed the animals don’t get recognition for the work that they do.”
She envisions working in concert with farmers and breeders in a kind of licensing arrangement, potentially, where the owners of the animals that produce the cell lines can share in the rewards of their popularization and wider commercial production.
That also helps in the mission of curbing the emissions associated with big agribusiness and breeding and raising livestock on a massive scale. If you only need a few animals to make the meat, you don’t have the same environmental footprint for the farms.
“We need to make sure that we don’t make the mistakes that we did in the past that we only breed animals for yield and not for flavor,” said Bubner.
Even though the company is still in its earliest days, it already has one letter of intent, with one of San Francisco’s most famous butchers. Guy Crims, also known as “Guy the Butcher,” has signed a letter of intent to stock Orbillion Bio’s lab-grown Wagyu in his butcher shop, Bubner said. “He’s very much a proponent of lab-grown meat.”
Now that the company has its initial technology proven, Orbillion is looking to scale rapidly. It will take roughly $3.5 million for the company to get a pilot plant up and running by the end of 2022, and that’s in addition to the small $1.4 million seed round the company has raised from Joyant and firms like VentureSouq.
“The way I see an integrated model working later on is to have the farmers be the breeders of animals for cultivated meat. That can reduce the number of cows on the planet to a couple of hundred thousand,” Bubner said of her ultimate goal. “There’s a lot of talking about if you do lab-grown meat you want to put me out of business. It’s not like we’re going to abolish animal agriculture tomorrow.”
Image Credit: Getty Images
Powered by WPeMatico