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Equinix is acquiring bare metal cloud provider Packet
Equinix announced today that it is acquiring bare metal cloud provider Packet, the New York City startup that had raised over $36 million on a $100 million valuation, according to PitchBook data.
Equinix has a set of data centers and co-location facilities around the world. Companies that may want to have more control over their hardware could use their services, including space, power and cooling systems, instead of running their own data centers.
Equinix is getting a unique cloud infrastructure vendor in Packet, one that can provide more customized kinds of hardware configurations than you can get from the mainstream infrastructure vendors like AWS and Azure. Company COO George Karidis described what separated his company from the pack in a September, 2018 TechCrunch article:
“We offer the most diverse hardware options,” he said. That means they could get servers equipped with Intel, ARM, AMD or with specific nVidia GPUs in whatever configurations they want. By contrast public cloud providers tend to offer a more off-the-shelf approach. It’s cheap and abundant, but you have to take what they offer, and that doesn’t always work for every customer.
In a blog post announcing the deal, company co-founder and CEO Zachary Smith had a message for his customers, who may be worried about the change in ownership. “When the transaction closes later this quarter, Packet will continue operating as before: same team, same platform, same vision,” he wrote.
He also offered the standard value story for a deal like this, saying the company could scale much faster under Equinix than it could on its own, with access to its new company’s massive resources, including 200+ data centers in 55 markets and 1,800 networks.
Sara Baack, chief product officer at Equinix, says bringing the two companies together will provide a diverse set of bare metal options for customers moving forward. “Our combined strengths will further empower companies to be everywhere they need to be, to interconnect everyone and integrate everything that matters to their business,” she said in a statement.
While the companies did not share the purchase price, they did hint that they would have more details on the transaction after it closes, which is expected in the first quarter this year.
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Oscar Health now has 400,000 members and expects to bring in $2 billion by the end of 2020
Oscar Health, the upstart healthcare insurance company and technology developer, expects to have roughly 400,000 members insured under its healthcare plans, who collectively will bring in roughly $2 billion in revenue for the company by the end of 2020, according to slides of a presentation from the JP Morgan Healthcare conference seen by TechCrunch.
Those figures, based on the open-enrollment period that just closed, would represent 50% growth both in membership and revenue for the healthcare provider co-founded by Mario Schlosser and Joshua Kushner, founder of VC firm Thrive Capital and the brother of senior Trump advisor Jared Kushner.
Earlier today, Oscar announced that it was partnering with Cigna to provide services to small business owners. Commercial health insurance is a small but growing proportion of Oscar’s total membership, and it’s one area where the company hopes to expand. Essentially, Oscar can bring its technology-enabled healthcare services to small businesses in concert with the large healthcare networks with which businesses are used to working.
To date, Oscar counts around 375,000 individual members on its insurance plans, with another 20,000 coming through small-group insurance and the balance derived from Medicare Advantage customers, according to a person familiar with the company’s business.
Only three years ago, Oscar was a much smaller business, with only 70,000 members after retrenching its coverage and pulling out of markets in Dallas-Fort Worth and New Jersey. From a footprint that encompassed New York, San Antonio, Los Angeles, Orange County and San Francisco, Oscar now expects to operate in 29 markets by the end of 2020.
Fueling that expansion is prodigious capital infusions the company has received over the past few years. In 2018 alone, Oscar raised $540 million from investors including Alphabet, Founders Fund, Capital G (Alphabet’s later-stage investment firm) and Verily, Alphabet’s investment firm focused on life sciences. In all, Oscar Health has raised $1.3 billion to fulfill its vision of providing better healthcare services through technologies like a mobile app for telemedicine, physician consultations, booking appointments, prescription refills and a more concierge-like healthcare experience for its members.
Initially, the company took advantage of the Affordable Care Act’s creation of new marketplaces for individuals to buy health insurance when it launched in 2012, but is now looking to buoy its growth by adding more deals with insurance providers like Cigna for small businesses.
Ultimately, the company envisions a healthcare industry where employer-defined plans will disappear as more consumers turn to Individual Coverage Health Reimbursement Arrangements. In that environment, Oscar’s bespoke services — like the recent partnership with the startup Capsule Pharmacy to provide same-day prescription delivery for Oscar’s members in New York — or the company’s tight relationship with providers like the Cleveland Clinic, become competitive advantages.
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Atrium lays off lawyers, explains pivot to legal tech
Seventy-five-million-dollar-funded legal services startup Atrium doesn’t want to be the next company to implode as the tech industry tightens its belt and businesses chase margins instead of growth via unsustainable economics. That’s why Atrium is laying off most of its in-house lawyers.
Now, Atrium will focus on its software for startups navigating fundraising, hiring and collaborating with lawyers. Atrium plans to ramp up its startup advising services. And it’s also doubling down on its year-old network of professional service providers that help clients navigate day-to-day legal work. Atrium’s laid-off attorneys will be offered spots as preferred providers in that network if they start their own firm or join another.
“It’s a natural evolution for us to create a sustainable model,” Atrium co-founder and CEO Justin Kan tells TechCrunch. “We’ve made the tough decision to restructure the company to accommodate growth into new business services through our existing professional services network,” Kan wrote on Atrium’s blog. He wouldn’t give exact figures, but confirmed that more than 10 but less than 50 staffers are impacted by the change, with Atrium having a headcount of 150 as of June.
The change could make Atrium more efficient by keeping fewer expensive lawyers on staff. However, it could weaken its $500 per month Atrium membership that included some services from its in-house lawyers that might be more complicated for clients to get through its professional network. Atrium will also now have to prove the its client-lawyer collaboration software can survive in the market with firms paying for it rather than it being bundled with its in-house lawyers’ services.
“We’re making these changes to move Atrium to a sustainable model that provides high-quality services to our clients. We’re doing it proactively because we see the writing on the wall that it’s important to have a sustainable business,” Kan says. “That’s what we’re doing now. We don’t anticipate any disruption of services to clients. We’re still here.”
Justin Kan (Atrium) at TechCrunch Disrupt SF 2017
Founded in 2017, Atrium promised to merge software with human lawyers to provide quicker and cheaper legal services. Its technology can help automatically generate fundraising contracts, hiring offers and cap tables for startups while using machine learning to recommend procedures and clauses based on anonymized data from its clients. It also serves like a Dropbox for legal, organizing all of a startup’s documents to ensure everything’s properly signed and teams are working off the latest versions without digging through email.
The $500 per month Atrium membership offered this technology plus limited access to an in-house startup lawyer for consultation, plus access to guide books and events. Clients could pay extra if they needed special help such as with finalizing an acquisition deal, or access to its Fundraising Concierge service for aid with developing a pitch and lining up investor meetings.
Kan tells me Atrium still has some in-house lawyers on staff, which will help it honor all its existing membership contracts and power its new emphasis on advising services. He wouldn’t say if Atrium is paid any equity for advising, or just cash. The membership plan may change for future clients, so lawyer services are provided through its professional network instead.
“What we noticed was that Atrium has done a really good job of building a brand with startups. Often what they wanted from attorneys was…advice on ‘how to set my company up,’ ‘how to set my sales and marketing team up,’ ‘how to get great terms in my fundraising process,’ ” so Atrium is pursuing advising, Kan tells me. “As we sat down to look at what’s working and what’s not working, our focus has been to help founders with their super-hero story, connect them with the right providers and advisors, and then helping quarterback everything you need with our in-house specialists.”
LawSites first reported Saturday that Atrium was laying off in-house lawyers. A source says that Atrium’s lawyers only found out a week ago about the changes, and they’ve been trying to pitch Atrium clients on working with them when they leave. One Atrium client said they weren’t surprised by the changes because they got so much legal advice for just $500 per month, which they suspected meant Atrium was losing money on the lawyers’ time as it was so much less expensive than competitors. They also said these cheap legal services rather than the software platform were the main draw of Atrium, and they’re unsure if the tech on its own is valuable enough.
One concern is Atrium might not learn as quickly about which services to translate into software if it doesn’t have as many lawyers in-house. But Kan believes third-party lawyers might be more clear and direct about what they need from legal technology. “I feel like having a true market for the software you’re building is better than having an internal market,” he says. “We get feedback from the outside firms we work with. I think in some ways that’s the most valuable feedback. I think there’s a lot of false signals that can happen when you’re the both the employer and the supplier.”
It was critical for Atrium to correct course before getting any bigger, given the fundraising problems hitting late-stage startups with poor economics in the wake of the WeWork debacle and SoftBank’s troubles. Atrium had raised a $10.5 million Series A in 2017 led by General Catalyst alongside Kleiner, Founders Fund, Initialized and Kindred Ventures. Then in September 2018, it scored a huge $65 million Series B led by Andreessen Horowitz.
Raising even bigger rounds might have been impossible if Atrium was offering consultations with lawyers at far below market rate. Now it might be in a better position to attract funding. But the question is whether clients will stick with Atrium if they get less access to a lawyer for the same price, and whether the collaboration platform is useful enough for outside law firms to pay for.
Kan had gone through tough pivots in the past. He had strapped a camera to his head to create content for his live-streaming startup Justin.tv, but wisely recentered on the 3% of users letting people watch them play video games. Justin.tv became Twitch and eventually sold to Amazon for $970 million. His on-demand personal assistant startup Exec had to switch to just cleaning in 2013 before shutting down due to rotten economics.
Rather than deny the inevitable and wait until the last minute, with Atrium Kan tried to make the hard decision early.
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Former Google Pay execs raise $13.2M to build neo-banking platform for millennials in India
Two co-founders of Google Pay in India are building a neo-banking platform in the country — and they have already secured backing from three top VC funds.
Sujith Narayanan, a veteran payments executive who co-founded Google Pay in India (formerly known as Google Tez), said on Monday that his startup, epiFi, has raised $13.2 million in its Seed financial round led by Sequoia India and Ribbit Capital. The round valued epiFi at about $50 million.
David Velez, the founder of Brazil-based neo-banking giant Nubank, Kunal Shah, who is building his second payments startup CRED in India, and VC fund Hillhouse Capital also participated in the round.
The eight-month-old startup is working on a neo-banking platform that will focus on serving millennials in India, said Narayanan, in an interview with TechCrunch.
“When we were building Google Tez, we realized that a consumer’s financial journey extends beyond digital payments. They want insurance, lending, investment opportunities and multiple products,” he explained.
The idea, in part, is to also help users better understand how they are spending money, and guide them to make better investments and increase their savings, he said.
At this moment, it is unclear what the convergence of all of these features would look like. But Narayanan said epiFi will release an app in a few months.
Working with Narayanan on epiFi is Sumit Gwalani, who serves as the startup’s co-founder and chief product and technology officer. Gwalani previously worked as a director of product management at Google India and helped conceptualize Google Tez. In a joint interview, Gwalani said the startup currently has about two-dozen employees, some of whom have joined from Netflix, Flipkart, and PayPal.
Shailesh Lakhani, Managing Director of Sequoia Capital India, said some of the fundamental consumer banking products such as savings accounts haven’t seen true innovation in many years. “Their vision to reimagine consumer banking, by providing a modern banking product with epiFi, has the potential to bring a step function change in experience for digitally savvy consumers,” he said.
Cash dominates transactions in India today. But New Delhi’s move to invalidate most paper bills in circulation in late 2016 pushed tens of millions of Indians to explore payments app for the first time.
In recent years, scores of startups and Silicon Valley firms have stepped to help Indians pay digitally and secure a range of financial services. And all signs suggest that a significant number of people are now comfortable with mobile payments: More than 100 million users together made over 1 billion digital payments transaction in October last year — a milestone the nation has sustained in the months since.
A handful of startups are also attempting to address some of the challenges that small and medium sized businesses face. Bangalore-based Open, NiYo, and RazorPay provide a range of features such as corporate credit cards, a single dashboard to manage transactions and the ability to automate recurring payouts that traditional banks don’t currently offer. These platforms are also known as neo-bank or challenger banks or alternative banks. Interestingly, most neo-banking platforms in South Asia today serve startups and businesses — not individuals.
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CES takes half-baked stance on cannabis
A cannabis company won a CES award for 2020. Called Keep, the desktop storage device features biometric security to secure cannabis products, and looks good while doing it. The CTA gave them an Innovations Award Nominee in October and then weeks later told the company they were unable to use the word “cannabis” when exhibiting.
Keep Labs decided to stay home and not exhibit at the massive Consumer Electronics Show, potentially missing out on distribution deals, funding and increased brand awareness.
Vaporizers, cannabis and tobacco alike have long been found on the CES show floor. They’re often hidden under different names, like aromatherapy devices. This year is different. They’re gone from the show floor. I spent hours in the halls of the Las Vegas Convention Center and the Sands Expo center. The vapes are missing from the 2020 show.
That could change, according to a spokesperson for CES. The trade group behind the show is evaluating if cannabis has a place at CES.
The Consumer Technology Association (CTA) runs CES. It’s the largest such trade event in the world and attended by some 200,000 people. After speaking with a CTA spokesperson, it’s clear the trade organization knows its under close scrutiny and yet it’s still willing to blur lines to allow some companies ancillarily to cannabis to exhibit. That is, if they don’t talk about the device’s true intention.
In the past, sex tech was explicitly banned, so companies like OhMiBod exhibited under Health and Wellness. Vaporizers could be categorized as aromatherapy devices. Emails obtained by TechCrunch show the CTA has told cannabis-adjacent companies it can exhibit if cannabis is not mentioned on the show floor.
Keep Labs submitted its cannabis storage device exhibit under the “Home Storage” category. Upon its acceptance, the CTA nominated the device to the coveted Innovation Award and told the company it could present, as long as it doesn’t mention cannabis. You see, to the CTA, Keep Labs’ product is acceptable as it could have another purpose other than storing cannabis gummies; it could, in theory, be used to store candy gummies. Keep Labs told TechCrunch that avoiding saying “cannabis” goes against the company’s best interest, so it decided to skip the show.
Canopy Growth operates several prominent brands in the cannabis space. Like Keep Labs, it feels CES is not the right place to exhibit its wares if true intentions need to be hidden.
The Canadian company announced a new line of vape pens and cartridges in late 2019. With smart features and an app component, it would be perfect fodder among CES’ high-tech exhibits. The company also owns Storz-Bickel, a vaporizer company with historic roots that could exhibit in this CES gray area.
Canopy Growth acknowledges it’s banned from the show while some smaller competitors are able to exhibit by skirting the rules.
Canopy Growth CTO Peter Popplewell tells TechCrunch he still attends CES. It’s essential for him and Canopy Growth’s brands, even if the company isn’t exhibiting. For him, as the CTO, he’s meeting with component makers and suppliers.
“As the largest producer of legally produced medical and recreational cannabis and hemp products, and now a hardware manufacturer, Canopy Growth is constantly looking for ways to provide next-generation innovation to our customers and enhance their cannabis experience,” Popplewell told TechCrunch. “Within its portfolio of brands, Canopy has brought to market five different vaporizer products this fiscal year and our R&D pipeline is full of exciting developments.
“CES is the tradeshow where I am able to meet with a host of component manufacturers that help us develop safety features on our devices — such as accurate temperature control and locking the devices to address the unique needs and concerns of cannabis users,” Popplewell said.
Pax is one of the largest cannabis hardware companies and does not exhibit at CES. To be clear, Pax still has a presence in Las Vegas during CES, even though it’s not at the show itself. Like many companies at CES, Pax holds meetings and attends third-party events during CES. This lets the company bypass the CTA’s rules and still access CES attendees.
Earlier this week Pax released its Era Pro vaporizer that features PodID, a clever feature that brings a lot of information to the user.
Pax VP of Policy Jeff Brown, tells TechCrunch he’s puzzled by the CTA’s stance.
“CTA’s stubborn refusal to allow cannabis companies on the show floor is both comic and puzzling,” Brown said. “Cannabis is fully legal in Las Vegas, and there are multiple dispensaries within a mile of the convention center. Inside, companies offer an open bar in their booth, and hundreds walk the floor with a drink in hand.
“Nobody is asking to consume at CES,” Brown added. “There’s a lot of interesting technology being developed to take the guesswork out of weed. There are vaporizers with apps that tell consumers what they’re smoking, they detail the chemical attributes, and provide controls to measure each dose. There’s even a numeric lock to make the vaporizer unusable by children.”
As he told TechCrunch, this technology is legal, and cannabis itself is legal in 33 states and Canada.
“Unfortunately, you’re not going to learn about it at CES,” Brown said.
Right now, even in 2020, there are ways around the CTA’s ban. In the case of Keep Labs, the CTA granted the company permission to exhibit — as long as cannabis wasn’t mentioned. The company decided that to exhibit without saying “cannabis” wouldn’t do the brand justice. They don’t want to shy away from cannabis.
This is the puzzling part. The CTA will let companies exhibit, as long as their true intentions are hidden. The CTA used to do the same with sex toys, too.
In the run-up to the 2019 show, the CTA awarded sextech maker Lori DiCarlo with an Innovations Award. It later rescinded the award after the trade organization decided it was too sexy for CES. Fallout followed and expanded as the show opened, and sextech was found throughout the show floor, despite the ban affecting Lori DiCarlo. As with cannabis, the CTA allowed sextech under the guise of as “personal massagers” alongside therapy and sports massagers in the Health and Wellness category.
The CTA introduced the Sex Tech category for the 2020 show on a trial basis. I’m told the category will likely live on to future shows, too. This is how the CTA operates, the CTA told TechCrunch. It trials a category, and then if it works out, the category is rolled into the show.
“For us, cannabis is a tough decision,” a CTA spokesperson told TechCrunch. “It’s complicated, and the laws are changing quickly. We are watching closely, and I would not be surprised if, at some point in the future, it was part of the show.”
The CTA tells TechCrunch it continually looks at the regulatory environment, pointing out that cannabis is still an illicit substance at the federal level in the United States. The CTA however acknowledges cannabis is legal in the state of Nevada.
Nevada is one of the 33 states in the United States where cannabis is legal in some form. In Nevada, it’s legal to consume for recreational uses. The state law allows for cannabis consumption in a private residence, making it illegal to consume in a hotel, public space or convention center. There are dozens of cannabis dispensaries within miles of CES.
Cortney Smith’s vaporizer company DaVinci is based in Las Vegas and has exhibited at CES a handful of times. As he tells TechCrunch, the company didn’t have a problem presenting on the show floor, but “didn’t paste pot leaves all over.”
Smith explained that he feels the CTA’s radar has grown more sensitive in part by the vaporizer scare in 2019.
“In the past, [cannabis products weren’t] challenged,” Smith said. “So when we were there, as a cannabis vaporizer, we did not get scrutinized because [the CTA] was not on alert.”
DaVinci isn’t exhibiting this year despite recently launching a new product. The dry herb DaVinci IQ2 just hit the market and is among a new crop of vaporizers designed to bring more transparency to cannabis use. It uses on-device processing to track and record active compounds produced per draw. The sleek device and smartphone app would look at home among the latest gadgets found at CES.
As he puts it, if CES doesn’t want the business, there’s an opportunity for other trade shows to pick up cannabis products and run with it.
“CES has competition,” Smith said. “There are other consumer electronics shows around the world that would love to steal their thunder and star power. And the chance [the CTA] takes when they limit their innovation — like no sex toys or no cannabis — it gives the opportunity to some other electronics show to welcome adult toys or adult devices. So I guess they’re willing to make this compromise to play it safe.”
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Rappi and Oyo pare staff as Vision Fund companies trim costs, target profits
This week we’ve covered layoffs at unicorns both inside the Vision Fund and out. This afternoon we add two more to our list: Oyo and Rappi.
The staff reductions are surprising — and not. They are surprising, as Oyo (India-based, low-cost hotels) and Rappi (Latin America-focused e-commerce) were bright lights in the Vision Fund’s crown. And the layoffs are not surprising as other famous unicorns have recently cut staff in a bid to reduce costs, diminish losses and aim closer to profitability.
Our net lack of shock is underscored by the Vision Fund itself, which signaled late last year that it wants portfolio companies to get profitable and get public. The cuts are therefore a little more than unsurprising; we should have anticipated them.
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Casper files to go public, shows you can lose money selling mattresses
E-commerce phenom and D2C bright light Casper has filed to go public.
The New York-based company that raised nearly $340 million while private, according to Crunchbase data, expects to trade on the New York Stock Exchange under the ticker symbol “CSPR.” Its S-1 filing includes a $100 million placeholder figure for its possible capital raise.
The company will need the money, as it loses money and burns cash. Let’s explore just how a mattress company does that.
Growth, loss
In the full years of 2017 and 2018, Casper recorded revenue of $250.9 million (net of $45.7 million in “refunds, returns, and discounts”) and $357.9 million (net of $80.7 million in “refunds, returns, and discounts”). That worked out to growth of 42.6% in the year.
Over the same two periods, Casper lost $73.4 million and $92.1 million on a net basis, respectively.
In the first three quarters of 2019 versus 2018, Casper put up $312.3 million in top line (net of $80.1 million in “refunds, returns, and discounts”), up just over 20% from its year-ago three-quarter tally of $259.7 million in revenue (net of $57.7 million in “refunds, returns, and discounts”).
The company’s net loss during the three-quarter period rose from $64.2 million in 2018 to $67.4 million in 2019. The company’s net losses are generally rising (though slowly so far in 2019), while its growth decelerates.
In contrast, and to the company’s favor, its operating cash burn is slowing. From $84.0 million in 2017 to $72.3 million in calendar 2018, Casper slowed its operating cash consumption further in 2019, to just $29.7 million in the first three quarters of the year, compared to $44.9 million over the same period of the preceding year.
But the company’s slowing growth and stiff losses using regular accounting methods (GAAP) could strain its valuation. Casper was valued at $1.1 billion in its most recent funding round.
While the company’s gross margins aren’t bad for a non-software company (49.6% in the first nine months of 2019), the firm spent over 73% of its gross profit last year on sales and marketing costs. That figure indicates that Casper spent heavily to generate growth, growth that came in at about 20% so far in 2019, as reported.
That fact implies that growth will remain constrained, as the firm can’t afford to spend too much more on the line item. Which begs the question: What’s the value of a firm that is showing slowing growth, non-recurring revenue and sticky GAAP losses?
The company’s adjusted losses aren’t much better. Looking at its adjusted EBITDA, a profit metric so distorted to flatter that it’s nigh a funhouse mirror, Casper only marginally improved on its 2018 tally looking at the first three quarters of that year (-$57.5 million) in 2019 (-$53.8 million).
Investors
Casper has raised from IVP, Lerer Hippeau, Target and New Enterprise Associates. The firm raised seed capital back in 2014 along with a Series A. Lerer and NEA were most active back then, looking at its funding history.
The company raised $55 million more in 2015, and a far-larger $170 million in mid-2017. A $100 million round came in 2019 that set it up for its 2020 IPO.
This company’s IPO is a pricing question. And one that will impact a host of startups that both compete directly with Casper or operate in a different vertical with a similar business. Get hype.
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Layoffs at Lime and Getaround herald rise of profit-hungry unicorns
Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.
A million dollars isn’t cool. You know what’s cool? Positive adjusted EBITDA, or something close to it.
That’s the message from scooter unicorn Lime, which announced this week that it was cutting about 14% of its staff and closing a dozen markets. The staff reductions, numbering about 100, come as the company has touted efforts to improve its profitability — going as far as setting targets for when it might reach capital freedom, as well as highlighting the matter in a recent corporate blog post.
(Bird, a Lime competitor, also underwent layoffs this year.)
What’s going on? Unicorns, once hungry for growth, are now hell-bent to show current (and future) investors that their businesses aren’t unprofitable quagmires. Profitability, or movement towards it, is hot, and Lime is a good example of the trend — as is Getaround, which also wrote about its own layoffs this week. Let’s dig in.
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Lucky coffee, unicorn stumbles and Sam Altman’s YC wager
Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.
This week we had TechCrunch’s Alex Wilhelm and Danny Crichton on hand to dig into the news, with Chris Gates on the dials and more news than we could possibly cram into 30 minutes. So we went a bit over; sorry about that.
We kicked off by running through a few short-forms to get things going, including:
- Alex wanted to talk about his recent story on Lily AI’s $12.5 million Series A. Canaan led the round into the e-commerce-focused recommendation engine that has a cool take on what people care about.
- Danny talked about the acquisition of Armis Security by Insight for $1.1 billion, the VC round for self-driving forklift startup Vecna and an outside-the-Valley round for Houston-based HighRadius.
Turning to longer cuts, the team dug into the latest from SoftBank, its Vision Fund and the successes and struggles of its enormous startup bets. Leading the news cycle this week were layoffs at Zume, a robotic pizza delivery venture that is no longer pursuing robotic pizza delivery. Now it’s working on sustainable packaging. Cool, but it’s going to be hard for the company to grow into its valuation while pivoting.
Other issues have come up — more here — that paint some cracks onto the Vision Fund’s sunny exterior. Don’t be too beguiled by the bad news, Danny says; venture funds run like J-Curves, and there are still winners in that particular portfolio.
After that, we turned to China, in particular its venture slowdown. The bubble, in Danny’s view, has burst. The story discussed is here, if you want to read it. The short version for the lazy is that not only has China’s venture scene slowed down dramatically, but startups — even those with ample capital raised — are dying by the hundred. But one highly caffeinated Chinese startup continues to find growth in the world’s greatest tea market.
Finally we hit on the Sam Altman wager and the latest from Sisense, which is now a unicorn. All that and we had some fun.
Equity drops every Friday at 6:00 am PT, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.
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Just Spices, the German spice mix startup, raises €13M Series B
Just Spices, the German-founded spice mix brand, is disclosing €13 million in Series B funding. The round is led by Five Seasons Ventures and Coefficient Capital, with Bitburger Ventures also joining.
A direct to consumer play, Just Spices offers two main product lines: Spice Mixes and “IN MINUTES”.
The first consists of various spice blends, with new blends being developed based on the sales and customer feedback data the startup is amassing.
The second, launched in 2018, is recipe-driven, offering 27 “fix” meal preparations that sees Just Spices provide the recipe and spice mix needed to prepare a quick meal, with only a few additional fresh ingredients required to complete the dish. It appears to share some similarities with SimplyCook in the U.K.
“The need for innovative, fast and still balanced solutions in the food sector is greater than ever,” says Just Spices co-founder and CEO Florian Falk. “On the one hand, people have less time available so food has to be as uncomplicated as possible, but on the other, we still have wants and needs… With Just Spices, and especially with IN MINUTES, we offer a carefree alternative, which consumers can be confident is fast and tasty whilst still fitting into a conscious, healthy diet.”
As part of its customer acquisition strategy and to power a product development feedback loop, Just Spices says it has built a vibrant, active digital community of home cooks. More than 60% of its sales are generated online, and the company claims to be one of the most followed spices brands in Europe (on social media). And certainly the startup is investing in content, including operating its own in-house studio and producing podcasts.
“We want to become the world’s largest lifestyle spice brand,” adds Falk. “To achieve this, we have not only built a fantastic partnership network, we have brought together an amazing team. We want to bring the joy and fun of cooking to many more people.”
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