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Bevy acquires community-focused networking company CMX
Bevy announced today that it has acquired CMX, which it describes as “the world’s largest community for community professionals.”
In other words, CMX is trying to connect and support the people whose job is to build communities around their companies. To do that, it organizes the CMX Summit and also offers membership to a private network called CMX Pro.
Bevy, meanwhile, has built software for companies to manage community events. In fact, the company was created by the organizers of Startup Grind, who said they initially built Bevy because of the challenge involved in managing all the different Startup Grind events.
The company now says it works with customers including Slack, Atlassian, Asana, Gainsight and Duolingo — in fact, Duolingo uses it to host 1,000 monthly events.
In an email, Bevy CEO Derek Andersen told me, “I’ve been a CMX community speaker, sponsor, and member for many years, and there is no better way to get educated and networked in the community industry than CMX.”
The financial terms of the acquisition were not disclosed. CMX’s co-founder and CEO David Spinks will continue to lead CMX initiatives within Bevy, and he will become the company’s vice president of community.
“People are in desperate need of meaningful community,” Spinks said in the acquisition announcement. “They’re craving more depth, and that often comes through in-person, real world connection. Derek and the Bevy team have built a great platform to help teams scale their IRL community programs. We’re thrilled to join forces and work toward a more meaningfully connected world.”
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DoorDash is reportedly raising $500M at a $6B+ valuation
Just days after Postmates filed confidential paperwork for an initial public offering, the latest news in the on-demand delivery space is that competitor DoorDash is in the process of raising a $500 million round, The Wall Street Journal reports. The round would reportedly value DoorDash at more than $6 billion and possibly up to $7 billion.
According to the WSJ, Temasek Holdings Pte., Singapore’s state investment firm, is expected to lead the round.
Last year, DoorDash raised a $250 million round of financing that valued the company at $4 billion. In total, DoorDash has raised nearly $1 billion in funding from investors like SoftBank, Sequoia, DST Global, Kleiner Perkins and others.
Earlier this year, the food-delivery startup became the first startup to operate in all 50 states. Meanwhile, similar to Instacart, DoorDash has also reportedly been subsidizing worker pay with tips from customers, but DoorDash still has yet to respond to TechCrunch regarding the practice.
I’ve reached out to DoorDash and will update this story if I hear back.
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Paris sues Airbnb for illegal listings and seeks $14.2 million
The City of Paris first warned Airbnb, and it is now taking action. The mayor of Paris, Anne Hidalgo, told the JDD that the city is suing the company for 1,010 illegal listings. The fine could be worth as much as $14.2 million (€12.625 million).
Based on current legislation, you can’t rent an apartment more than 120 days a year. If you want to rent an apartment on Airbnb in Paris, you first must register your apartment with the city. The city then gives you an ID number so they can track how many nights you’re listing your apartment on Airbnb.
And yet, many listings still don’t have that ID number. The mayor’s office flagged around 1,000 apartments back in December 2017 and said Airbnb was dragging its feet. The company had little incentive to comply, as hosts were responsible for their own listings.
Thanks to a new law, the responsibility is now shared between the hosts and the platform. The City of Paris can now fine Airbnb for all those illegal listings, up to €12,500 per listing.
According to Hidalgo, Airbnb has been putting too much pressure on the housing market. She thinks that 65,000 apartments are now reserved for Airbnb in Paris alone. In some areas, it has become quite hard to find an apartment because of that. Local shops also suffer because tourists have different needs. In addition to better monitoring, Hidalgo is also in favor of restricting listings to 30 nights per year.
Airbnb told the JDD that it has complied with regulations and informed all Airbnb hosts about the new rules. The company also says that regulation in Paris doesn’t comply with European regulation. It’s clear that this fight is not over.
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Taali takes its popped water lily snacks from Y Combinator to the world
Aditya and Aarti Kochhar Kaji didn’t set out to start the snack food business Taali Foods when they were studying for their business degrees at Harvard.
The couple both hail from Mumbai and met at the University of Pennsylvania . They were married before starting at Harvard’s Business School and initially were interested in other areas — Aarti was exploring a career in venture capital and Aditya was looking at the food and beverage industry broadly in his classes at Harvard.
Addicted to snack foods like chips and popcorn to fuel her Harvard study sessions, Aarti started making popped water lily seeds as a snack — a food both she and her husband had grown up eating in India, she said.
The seeds, which are high in anti-oxidants and low in fat, have been a staple of Ayurvedic medicine — thanks to their purported anti-inflammatory properties, and are a staple of Indian snacking traditions. Now, with American consumers on the hunt for healthier snacks, they’re becoming a big business in the U.S. as well.
Y Combinator is very on-trend, with its decision to invest and accelerate Taali as part of its most recent cohort of startups. But in this instance you may call the accelerator a fast follower rather than a progenitor of this trend.
No less auspicious a food tastemaker than Whole Foods named water lily seeds as one of the top 10 new food trends of 2019. With that attention, competitors to Taali abound.
Bohana and AshaPops are just two new snack food companies floating on the popped water lily seed movement. Bohana even managed to nab the attention of PepsiCo’s Nutrition Greenhouse competitive accelerator.
It’s no secret that technology investors are investing more heavily in consumer businesses — everything from snack foods to period products and baby formula — and startups need only point to the success of Amazon as the everything store to show that there’s always money to be made in the category.
Indeed, at $1.47 trillion, the consumer packaged goods industry dwarfs technology as a share of the nation’s economy.
As Ryan Caldbeck, the head of the consumer-focused investment firm CircleUp noted last year:
The uptick in tech VC dollars going to the CPG market is partly because tech investing is brutally competitive and saturated, and largely because these VCs are awakening to the strong historical returns in CPG, especially with the trend leaning towards small brands stealing market share.
Consumer is a massive market – about 3x the size of tech, as seen below.
Despite the size of the market, the early-stage has historically been underserved by investors due to market inefficiencies like the geographic dispersion of brands and a lack of structured information sources (i.e. there is no Silicon Valley for consumer, and certainly no Crunchbase equivalents – yet).
Strong exits are already possible for consumer brands — and not necessarily from the big-ticket, headline grabbing acquisitions like Dollar Shave Club. Last week This is L. — the condom and period product retailer — sold for roughly $100 million after raising seed funding from investors, including 500 Startups and Y Combinator.
Taali was similarly bootstrapped before it was accepted into Y Combinator. The company is already selling its snacks through Amazon and in retail locations like Fairway in New York and Central Market in Texas. The founders expect to be in stores in California in the next few months.
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Marketing company Zeta Global hires Ben Hayes as its first chief privacy officer
Zeta Global, the well-funded marketing technology company founded by CEO David A. Steinberg and former Apple CEO John Sculley, has hired its first chief privacy officer — Ben Hayes, who was previously chief privacy officer at Nielsen.
Steinberg said the company already has a “global privacy team” and has been taking the issue “very seriously.” However, he said that by hiring Hayes, he’s hoping to make Zeta a “global thought leader.”
“We want to send a message to the world that the end users that hit our platform are important to us, your privacy is important to us,” he said. And he noted, “When we sit down with our customers — and these are very, very large customers — the first two things they always want to talk about are data security and data privacy.”
For his part, Hayes said Zeta is “poised to deliver a unique value to the marketplace and, in my estimation, disrupt multiple industries in so doing.” He also said he was impressed by Zeta’s approach to protecting user data, specifically the fact that “it’s not a data broker.” In other words, even though it helps marketers target customers based on user data, it’s not selling that data to others.
I wondered whether that distinction might get lost in the broader backlash against the way online companies vacuum up personal data, but Hayes said, “I believe that paranoia grows in the shadows and the privacy backlash is largely about people feeling a loss of control over their data.”
“Explaining the value proposition to users is crucially important,” he added. “People are rational. If they understand it to be a net benefit to themselves they will like that thing.”
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Reddit confirms $300M Series D led by China’s Tencent at $3B value
Last week TechCrunch reported that Reddit was raising $150 million from Chinese tech giant Tencent and up to $150 million more in a Series D that would value the company at $2.7 billion pre-money or $3 billion post-money. After no-commenting on our scoop, today Reddit confirmed it has raised $300 million at $3 billion post-money, with $150 million from Tencent.
The deal makes for an odd pairing between one of the architects of China’s Great Firewall of censorship and one of America’s most lawless free-speech forums. Some Redditors are already protesting the funding by trying to post content that would rile Chinese’s internet watchdogs, like imagery from Tiananmen Square and Winnie the Pooh memes mocking Chinese President Xi Jinping’s appearance.
The round brings the Conde Nast-majority owned Reddit to $550 million in total funding. Beyond Tencent, the rest of the round came from previous investors potentially including Andreessen Horowitz, Sequoia and Fidelity. Apparently frustrated that we had disrupted its PR plan, Reddit today handed confirmation of the round to CNBC, which re-reported our scoop without citation. While CNBC reported in June 2018 that Reddit would top $100 million in revenue, a reliable source tells us Reddit only brought in $85 million in 2018 revenue.
Reddit’s CEO Steve Huffman has had his own problems with attribution after the exec was caught editing users’ comments to mislead viewers into thinking they were insulting their Subreddit’s moderators. Huffman managed to get off with just an apology and vow not to do it again, though he seemed to laugh off and excuse the abuse of power by saying “I spent my formative years as a young troll on the Internet.”
Reddit will have to compete for ad dollars with the Google-Facebook duopoly despite having less information about its users, who are often anonymous. Reddit sees 330 million users per month across its Subreddit forums for discussing everything from news and entertainment to niche types of pornography, conspiracy theories and other highly brand-unsafe content. Meanwhile, users may be concerned that Reddit’s policy views could be tightened as it cosies up to Tencent.
Reddit has struggled with staff departures and user revolts over the years as it tries to balance freedom of expression with civility. The hope is the cash could help it pay for experienced leaders and more moderation staff to maintain that balance. But without proper oversight, the cash could simply scale up Reddit and its problems along with it.
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C2A raises $6.5M for its in-car cybersecurity platform
Cars are now essentially computers on wheels — and like every computer, they are susceptible to attacks. It’s no surprise then that there’s a growing number of startups that are working to protect a car’s internal systems from these hacks, especially given that the market for automotive cybersecurity could be worth mor $900 billion by 2026.
One of these companies is Israel’s C2A Security, which offers an end-to-end security platform for vehicles, which today announced that it has raised a $6.5 million Series A funding round.
The round was led by Maniv Mobility, which previously invested in companies like Hailo, drive.ai and Turo, and ICV, which has invested in companies like Freightos and Vayyar. OurCrowd’s Labs/02 also participated in this round.
Like most companies at the Series A stage, C2A plans to use the new funding to grow its team, especially on the R&D side, and help support its customer base. Sadly, C2A does not currently talk about who its customers are.
The promise of C2A is that it offers a full suite of solutions to detect and mitigate attacks. The team behind the company has an impressive security pedigree, with the company’s CMO Nat Meron being an alumn of Israel’s Unit 8200 intelligence unit, for example. C2A founder and CEO Michael Dick previously co-founded NDS, a content security solution, which Cisco acquired for around $5 billion in 2012 (and then recently sold on to Permira, also for $5 billion).
“We are extremely proud to receive the support of such outstanding investors, who will bring tremendous value to the company,” said Dick. “Maniv’s expertise in autotech and strong network across the industry coupled with ICV’s rich experience in cybersecurity brings the perfect combination of skills to the table.”
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Nordic banking app Lunar Way raises €13M
Lunar Way, the Nordic banking app that’s riding new EU regulation to help inject more competition into the region, has raised €13 million in new funding. The round is led by SEED Capital, with participation from Greyhound Capital, Socii Capital and a number of individual investors from the financial services industry.
It also comes shortly after Lunar Way announced it had attained a PISP payments license, meaning that the fintech can offer a more comprehensive banking feature-set, including making payments out of third-party bank accounts on a user’s behalf.
This, says Lunar Way founder Ken Villum Klausen, also paves the way for the startup to crack open the “Nordic clearing system monopoly,” which has traditionally made it difficult for new banking entrants.
“The new payment license grants us the option to instruct underlying banks to do payments, pay bills or even pay in a retail environment from their accounts,” explains Klausen. “So when you sign up, you’re able to connect to an existing bank-account in the sign up flow. And after that control all your finances through our platform.”
In addition, Lunar Way has a PSD2 AISP license, so that it is regulated to “co-own the transaction data,” which Klausen says Lunar Way can use in the company’s PFM features and for new products.
“The [Lunar Way] product offers all the fundamentals from a banking app. You can pay bills, transfer money, set a budget, do saving-goals, manage your card etc. We also have a few subscription-based credit lines, where you pay a monthly fee [for credit],” he says.
In Denmark, Lunar Way also acts as a “NemKonto” — or national Danish account — a type of bank account that the Danish government stipulates by law that all citizens and businesses must have.
Adds Klausen: “It has taken a few years to build our app to suit the different demands of the Nordic countries, but now we are a serious competitor to traditional banks. Our aim is — and have always been — to fundamentally change the status quo of banking. We’re now welcoming more than 10,000 new users a month and counting, which is substantial considering the fact that the Nordics’ total addressable market is 27 million people.”
Meanwhile, Lunar Way says it will use the funding to help accelerate the banking app’s growth, in a bid to reach further scale across the Nordics. I also understand the fintech is already gearing up for a new funding round pegged for later this summer.
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Melonport dissolves in favor of its protocol, setting a new bar for the blockchain world
In the world of blockchain, it is the sector of fintech where most think Satoshi’s invention will have the greatest impact. And in finance, there are few more elite worlds than those of asset management. So it’s of some significance that a two-year project to disrupt and open up this world using blockchain has now come to fruition.
Last Friday in Zug — a small provincial Swiss town which has embraced crypto startups — the Melonport startup consciously chose to dissolve itself and release its Melon protocol on the world of asset management. It will now build its company on a blockchain protocol it doesn’t control. The precedence for this kind of move in the tech world are many. It’s not unheard for a startup to release an Open API and let other potential competitors build on it, while hoping they will be good enough to beat others. And Red Hat, long ago, built a huge company on top of the open-source Linux software.
What is different here is that Melonport built the Melon Protocol on the Ethereum blockchain, but it will no longer have the majority say on how that protocol develops. No one will technically “own” the Melon Protocol, but the founders of Melonport have entrusted its development to an independent Melon Council, which will provide governance and direction as it develops. What was Melonport will now morph into a new company called Madeeba to build tools on top of its creation. Madeeba will hold one seat on the Melon Council.
Fans of Stars Wars will have to forgive me, but it’s not unlike Obi-Wan Kenobi becoming stronger in “The Force” by allowing Darth Vader to kill him off. Augur is the only major crypto platform to do the same as Melonport: letting the community run the software. Augur has grown steadily too, showing this methodology can work.
Melon will now be an open-source protocol on the Ethereum blockchain for on-chain asset management. This pioneering blockchain software system is designed to allow literally anyone to set up, and manage, an asset management fund.
Melonport founder and now Madeeba founder Mona El Isa told me: “We always promised we would step back and hand over the protocol to a decentralized governance process. This is designed to consider all the stakeholders, the token holders, the developers, and the users (the managers and investors).”
Blockchain technology has the potential to radically transform business and allow community owned networks. However, getting the governance right is key in this space. That’s why creating a system that prevents co-option and capture by vested interests is so important. Other blockchains, such as EOS, have been criticized for being in thrall to a limited number of nodes, for instance.
The Melon Council is composed of the Melon Technical Council (MTC) and representatives of Melon Exposed Businesses (MEB). The first seats of the MTC have been assigned by the outgoing Melonport team to:
• Will Harborne (Director of Operations at Ethfinex)
• Nick Munoz-McDonald (former Head of Audit at Solidified)
• KR1 (represented by Janos Berghorn)
• Matthew Di Ferrante (founder, ZK Labs)
• Woorton (represented by Zahreddine Touag)
• Martin Lundfall (Formal Verification Researcher at Dapphub/MakerDAO)
• Fabian Gompf (VP Technology Partnerships at Parity)
• Former Melonport team / Madeeba (represented by Jenna Zenk)
Each Melon Council member will be issued a token that represents their membership into the Melon Council. They will then be able to use that token to make proposals and vote on key issues.
The Melon Council will also be powered by aragonOS, a Solidity framework on the Ethereum blockchain, which allows anyone to create, manage and participate in complex decentralized organizations.
The Melon Council DAO says this will allow decision making within the Melon Council to remain secure and transparent to the community. The members of the Melon Council will be able to vote on-chain on matters such as inviting new members into the Council, adjusting the amgu price, updating the Melon protocol.eth ENS subdomains and updating protocol parameters. The Melon Council will also be able to use Aragon tools to make their decisions about inflation spending transparent.
“We’re doing this to show that we were serious about building a decentralized system. If we stuck around everyone would be relying on us to be the sole maintainer of the protocol, or they might suspect we have some kind of bigger influence,” El Isa continued.
In the race toward decentralized asset management, there have been other attempts to create new vehicles, such as Iconomy and CoinBlock, but it’s fair to say none has been as successful or as long-lived as the Melonport project.
Madeeba will now aim to build a user-friendly product, “so anyone could set up a fund and not even feel you’ve entered into the blockchain space,” says El Isa. A sea of hands (belonging to both traditional and non-traditional asset managers) went up in the room when people were asked if they would pilot both Madeeba and the protocol.
Travis Jacobs — the lead Melon protocol developer and who’s worked on blockchain since 2011 — told me he said he decided to work on Melon to have an effect in an industry that is “sort of shuttered and only accessible to an elite few. It was a great opportunity to spread a democratic effect so anyone could set up an investment fund.”
In dissolving itself in favor of anon source protocol on which it plans to build its own products, the example set by Melonport could have wider ramifications in the nascent blockchain world.
The next time anyone sees a startup announce that it’s working on a “blockchain protocol to rule them all,” the next question to be asked should be: how will that protocol operate for others, and how will it be governed? Because governance has become one question, if not the key question, the brave new world of blockchain must answer.
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PerimeterX secures $43M to protect web apps from bot attacks
We know by now that modern website attacks are typically automated, as armies of bots knock on doors until they inevitably find vulnerabilities and take advantage. PerimeterX, a San Francisco, startup wants to protect sites from these automated assaults. Today, it announced a $43 million Series C.
The round was led by Scale Venture Partners . New investor Adams Street Partners joined existing investors Canaan Partners, Vertex Ventures and Data Collective in the round. Ariel Tseitlin, a partner at Scale, will be joining the company’s board under the terms of the deal. Today’s investment brings the total raised to more than $77 million, according to Crunchbase data.
Omri Iluz, co-founder and CEO at PerimeterX, says bots have become the preferred way of hackers to attack websites and mobile apps, and his company has developed a way to defend against that kind of approach. It uses an approach called behavioral fingerprinting to blunt these automated attacks.
“Once we gain visibility into the behavior of the user, we are able to discern between normal behavior and an anomalous behavior that looks like it’s coming from an automated tool,” he said. The solution looks at attributes like mouse movements and swipes. It also analyzes the hardware to understand the graphics driver and audio driver of whatever device the bot is purporting to be.
To achieve this kind of identification requires massive amounts of data, and PerimeterX uses machine learning to help understand normal behavior and shut down anomalous behavior in an automated fashion.
The company was founded in 2014 and currently has 140 employees. Ariel Tseitlin from Scale Venture Partners, whose firm is leading the round, says as companies reach this level of maturity, the Series C money tends to go into sales and marketing to push the revenue pedal and scale the company.
“While there is a lot of opportunity in R&D, generally at this stage most of the dollars are going for sales and marketing, so hiring more salespeople, hiring more marketers more sales ops. That’s where a big part of the expansion comes from, and that tends to be pretty closely correlated to revenue growth, and pretty closely correlated to just greater growth in general,” Tseitlin explained
We wrote about Signal Sciences’ funding last week, a company that also works to protect web apps using a firewall approach. Iluz says the two companies often work together with the same customers, rather than competing, because they attack the problem differently.
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