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This QR code startup just raised $5 million co-led by Coatue and Seven Seven Six
Amazon revolutionized one-click shopping, and it has a nearly $2 trillion market cap to show for the effort.
Now, a 10-person startup founded by JD Maresco, who previously cofounded the public safety app Citizen, says it plans to make it a lot easier for retailers who sell directly to their customers to make re-ordering their products just as fast and simple through its QR codes. Indeed, Maresco’s new startup, Batch, is already working with numerous products and brands that use Shopify, promising their customers “one-tap checkout” when it’s time to reorder an item as long as the retailer has slapped one of Batch’s codes on their items or incorporated the codes directly into their packaging.
For the moment, New York-based Batch is wholly reliant on Apple’s App Clip technology, which produces a lightweight version of an app to save people from having to download and install it before using it. (Users can instead load just a small part of an app on demand, and when they’re done, the App Clip disappears.)
But Maresco — whose company just raised $5 million in seed funding co-led by Coatue and Alexis Ohanian’s Seven Seven Six, with participation from Weekend Fund, Shrug Capital, and the Chainsmokers, among others — says Batch will eventually work on both iOS and Android phones. We talked with him yesterday to learn more about its ambitions to make the physical world “instantly shoppable.” Our chat has been edited lightly for length and clarity.
TC: Citizen and Batch are very different companies. Is there a unifying thread?
JM: I’ve spent a good portion of my career, trying to change the way people think about and interact with their physical environment. With Citizen, we were questioning why everyone doesn’t have immediate access to information about what the police are doing in our neighborhoods. With Batch, we’re asking a simpler question but something that matters to me as a consumer: Why isn’t it easier for me to get more of a product I love and use?
With subscriptions in general, I’ve found myself constantly frustrated because every few weeks I’m emailing to either pause a subscription, or restart it. I wanted an easier way to use my phone to reorder in 10 seconds on the spot. Our phones are capable of much more than we put them to use for and, so we set out to tackle that problem.
TC: Right now, Batch integrates with Shopify alone, correct?
JM: We have a Shopify plugin that brands can connect into the Batch platform, and then we integrate the experience, all the way from the physical world wherever this QR code lives, through the purchase experience on the mobile side of things into their fulfillment on the back end. But we’re also expanding to other e-commerce platforms.
TC: And Batch takes a per-transaction fee from every item that’s purchased using your codes?
JM: We’re developing our pricing model over time, but currently we’re taking a service percentage-based fee.
TC: How are you getting brands to partner with you?
JM: Brands are starting to wake up to this idea that they can actually create a new retail channel off their physical packaging, where a customer can effectively shop throughout their home or their place of work or anywhere where they interact with these products the moment they run out of an item. So we’ve been able to spend time with dozens of brands now, and work with them to actually reengineer their packaging and say, ‘Let’s put QR codes front and center and figure out how to make this a really important customer touchpoint.’
TC: How many brands are using the codes currently?
JM: We’re launching dozens of brands this summer. We’ve had overwhelming demand, to be honest, and we haven’t really even fully launched yet.
TC: These are physical codes that you’re sending off to your retail partners — stickers, magnets. Are you also creating digital QR codes?
JM: We have customers that are integrating QR codes into out-of-home advertisements, into direct mail, into T shirts, into promotional vans, so we’re not just limited to packaging. There’s a wide range of places that you can integrate QR codes for your customers.
TC: It’s interesting that Coatue led your round. We’ve seen the firm delve more into early-stage deals but a seed round seems anomalous. How did you connect with the firm?
JM: We met during the seed process. They reached out to me and I developed a relationship with Andy Chen and Matt Mazzeo and it was a great opportunity to to work with their platform — the way they support the go-to-market motion around B2B companies; they have a great data platform. Alexis [Ohanian’s] experience in the consumer space was really appealing, too.
TC: Your company makes sense, but I wonder what’s special about these codes. What’s to prevent countless other startups from doing what you’re doing?
JM: QR codes are all over the place. The product we’re building makes it really easy for brands to create high converting shopping experiences and a native mobile interface. It’s a combination of our Shopify integration and our native product design experience and the relationships we have with these brands and how we help them with their packaging that’s not something you can spin up overnight.
TC: I have to ask about Citizen, which was in the headlines recently for all the wrong reasons. Is there anything you want to say about the company or the app or some of that recent coverage?
JM: I’m not going to comment on the recent press, but I continue to be proud of what the company is continuing to do to help communities stay safe and understand what police and first responders are doing in their neighborhoods.
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6 strategies for running more effective startup board meetings
For many companies in the United States, a board of directors is a fact of doing business. While sole proprietorships and LLCs are not obligated to have one, C and S corporations must. The board’s goal is to ensure the best is done for the company and its shareholders. While many entrepreneurs see board meetings as a chore, they can be a powerful tool if used well.
Communicate often
While board meetings usually happen quarterly, it’s good practice to keep the conversation going in between them. Sending a monthly email update to the board offers multiple advantages:
- Shorter updates: Business professionals’ attention spans are shrinking. Shorter content is easier to digest, and therefore more likely to be read.
- Timely feedback: A quarter can be a long time, especially for young startups or during challenging times. The monthly format allows the company to receive help or feedback from the board earlier. In business, speed of iteration is key!
- Keep them posted: Keeping directors up to date will avoid lengthy updates during board meetings, ensuring focus remains on strategic conversations.
Reach out when in need
When meeting online, founders should pause often and regularly ask if there are questions — even if moments of silence feel awkward at times — to give directors a better opportunity to speak up.
Board members can also be solicited on an ad-hoc basis — founders should keep in mind that board members are here to help the company. If you have doubts about a project decision or want a second, informed opinion, reach out to a board member. This is especially true of directors who have expertise on a specific topic. A quick five-minute call can be a game changer.
Being a founder can be a lonely experience because it can be difficult to discuss sensitive matters with the team. Board members should sign nondisclosure agreements, allowing entrepreneurs to share confidential information and get a different perspective on things.
Discuss goals for the next fundraising event
Founders should make sure to regularly discuss business goals to ensure they reach their next round of funding. Because the industry landscape or economy evolved or the competition stepped up, investors may reconsider their expectations to further fund the company.
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Before an exit, founders must get their employment law ducks in a row
Successfully selling a business has much to do with timing. For many entrepreneurs, it’s the high-stakes end game where they cash out and reap the rewards of their efforts. At a certain point, when both buyers and sellers are working hard to close the deal, negotiations can move very quickly. If you’re the seller, this is not the time to discover unanticipated problems in your business.
Distressingly often, these problems are related to employment. Inattention to employment issues can have a significant impact on deals — from preventing closings and reducing the deal value to altering the deal terms or significantly limiting the pool of potential buyers.
Poor compliance, lack of policies or flawed practices mean potential liability exposure or expensive policy revisions and employee retraining — all of which can devalue your business.
Fortunately, such issues typically can be resolved well in advance with a little forethought and legal guidance. It’s important to get your employment ducks in a row long before you start planning your exit.
What follows is an overview of the three main categories of employment issues that can derail or delay a sale. For the most part, these assume an asset sale, but may vary in the case of a stock sale.
Compliance
By far the most significant problem is general employment law compliance. This means creating strong employment policies and practices that are documented, in place and operating long before you pursue a deal. The key area is wage and hour issues — timekeeping and payroll practices, worker classification issues (employee vs. independent contractor; exempt vs. non-exempt), meal and rest periods, PTO policies and payouts at termination.
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PairTree speeds adoption process with an online, self-matching platform and $2.25M seed
Making the choice to adopt, or to find an adopting family, is a legally complex, emotionally taxing, expensive and time-consuming process. PairTree aims to make one part at least considerably easier and faster with its online matching platform where expectant mothers and hopeful adopters can find each other without the facilitation of an agency or other organization. The company has just raised a $2.25 million seed round, a rarity in the industry.
The path to adoption is different for everyone, but there are generally some things they have in common: Once the process is started, it can take upwards of $50,000 and over a year-and-a-half to organize a match. While some of this comprises the ordinary legal hurdles involved in any adoption, a big part of it is simply that there are limited opportunities for adoption, and compatibility isn’t guaranteed. As many people considering adoption are doing so on the heels of unsuccessful fertility treatment, it can be a lot to take on and a dispiriting wait.
Erin Quick, CEO and co-founder (with CTO Justin Friberg) of PairTree, said that the modern adoption landscape is marked by the fact that nearly 95 percent of adoptions are open, meaning there is ongoing contact between a biological mother and adopting family.
“They’ll be working together forever, and that makes finding a highly compatible match that much more important,” Quick, herself a happy adopter, told TechCrunch in an interview. But because of the way adoption is generally done — through agencies licensed by states — there are limitations on how far anyone involved can reach.
“It’s so bound by geography,” she said. “It’s regulated at the state level and has been facilitated by state level, not because of state laws — there’s no rule saying you can’t adopt out of state — but because the facilitators are small nonprofits. They bind themselves to their geographic region because that’s what they can serve. We’re building a platform that makes what people are already doing much easier and more efficient.”
That platform is in many ways very much like a dating app, though of course the comparison is not exact and does not reflect the gravity of choosing to adopt. But like in the dating world, in adoption you have a cloud of people looking to connect over something highly dependent on personality and individual needs.
Screenshot of the way expectant mothers can filter and search for compatible adopting families.
PairTree onboards both expectant mothers and adopters with personality tests — not the light-hearted stuff of OkCupid but a broader, more consequential set of Jungian archetypes that signal a person’s high-level priorities in life. Think “wants to travel and learn” versus “wants to provide and nurture” (not that these are necessarily incompatible) — they serve as important indicators of preferences that might not be so easily summarized with a series of checkboxes. That’s not the only criterion, of course. Other demographic and personal details are also collected.
The adopters are added to a pool through which expectant mothers can sift and, if desired, contact (in this, Quick suggested, PairTree mirrors Bumble, where women must message first). PairTree also does basic due diligence stuff like identify verification and confirmation of other important steps like home studies.
If a likely match is found, all the relevant information is passed to the adoption facilitator, who will be coordinating the other legal and financial steps. PairTree isn’t looking to replace these agencies — in fact Quick said that they have been huge proponents of the platform, since it can shorten wait times and improve outcomes. She said based on their existing successful adoptions that the wait can be cut by half or even two-thirds, and thus the cost (which involves recurring payments as the agency searches and does the legal work) by a similar amount.
“These are small nonprofits; they don’t have a lot of tech chops. When we launched we went to attorneys first, actually, and we were surprised when agencies started reaching out,” she explained.
Agencies have been referring their adopters to PairTree, which has led to a lot of early traction, Quick said. And importantly, they’ve seen great diversity in their early success.
“Adoption has historically been denied by faith-based systems — LGBTQ families and single women have been subject to discrimination,” she noted. And in fact just last week a Supreme Court decision held up the right of religious adoption agencies to deny services to same-sex couples. Quick was proud to say that they have already facilitated adoptions by same-sex couples and single parents.
The company will also set aside 5 percent of its net profits, which hopefully will manifest in volume, for the Lifetime Healing Foundation, which offers counseling and support to birth mothers who have gone though the adoption process.
The $2.25 million seed round was led by Urban Innovation Fund, with Founder Collective, Female Founders Alliance and Techstars participating. It will surprise few to hear that adoption is not a particularly hot industry for venture capital, but rising interest and investment in fertility tech may have shed light on opportunities in adjacent spaces. Adoption is one where significant improvements can be enabled by technology, meaning startups can grow fast while having a positive impact.
The company plans to use the money to expand its product portfolio, pursue more partnerships, and perhaps most importantly for its users, build a native mobile app, since 90 percent of the service’s viewership is mobile.
“We’re grateful to our expert and diverse group of investors who share our vision that adoption should be a viable path to parenting for more people,” said Quick in the release announcing the raise. “Like us, our investors believe in the importance of supporting Biological and Adopting Families along with the Adoptees, because adoption is not a single transaction but a journey they’re taking over the course of a lifetime.”
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Autonomous trucking startup Embark to go public in $5.2B SPAC deal
Five-year old self-driving truck startup Embark Trucks Inc. said Wednesday it would merge with special purpose acquisition company Northern Genesis Acquisition Corp. II in a deal valued at $5.2 billion.
Embark takes a different approach to autonomous trucking: As opposed to manufacturing and operating a fleet of trucks themselves, which is the route rival TuSimple is taking, Embark offers its AV software as a service. Carriers and fleets can pay a per-mile subscription fee to access it. The company includes carriers Mesilla Valley Transportation and Bison Transport, and companies Anheuser-Busch InBev and HP Inc., among its partners.
Carriers purchase trucks with compatible hardware directly from OEMs, so Embark says it has designed its system to be “platform agnostic” across multiple components and manufacturers. The company says its software can simulate up to 1,200, 60-second scenarios per second, and make adaptive predictions using those scenarios for the behavior of other vehicles on the road.
Embark said in an investor presentation for the SPAC deal that it was targeting “driver-out,” or operating on roads without a safety driver, by 2023 and launching at a commercial scale across the American sunbelt the following year. However, Embark still has technical milestones yet to achieve, noting in the presentation that the software still needs to accomplish actions, such as interactions with emergency vehicles and responding to blown tires and other mechanical failures.
Upon closing, the transaction will inject Embark with around $615 million in gross cash proceeds, including $200 million in private investment in public equity (PIPE) funding from investors, including CPP Investments, Knight-Swift Transportation, Mubadala Capital, Sequoia Capital and Tiger Global Management.
Embark also said former Department of Transportation Secretary Elaine Chao was joining its board, likely a boon for a company operating in the autonomous trucking industry, which is still only authorized for commercial deployment in 24 states.
Embark was founded in 2016 by CEO Alex Rodrigues and CTO Brandon Moak, who worked together on autonomous driving while completing engineering degrees from Canada’s University of Waterloo. After launching out of Y Combinator, the company quickly went on to raise $117 million in total funding, including a $30 million Series B led by Sequoia Capital and a $70 million Series C led by Tiger Global Management.
The transaction is anticipated to close in the second half of 2021. The company joins competitor AV trucking developer Plus in going public via a SPAC merger. TuSimple opted for a traditional initial public offering in March.
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Investors’ thirst for growth could bode well for SentinelOne’s IPO
Turning the page from the early-stage venture capital market to the super late-stage exit market, this morning we’re talking about endpoint security company SentinelOne’s IPO in the context of Sprinklr’s own. We’ll have more on the public offering market later today when Doximity and Confluent price their respective IPOs after the close of trading.
The Exchange explores startups, markets and money. Read it every morning on Extra Crunch or get The Exchange newsletter every Saturday.
SentinelOne’s IPO, expected to price on June 29 and trade June 30, is a fascinating debut. Why? Because the company sports a combination of rapid growth and expanding losses that make it a good heat check for the IPO market. Its debut will allow us to answer whether public investors still value growth above all else. And this week, the company gave us an early dataset regarding its market value in the form of an IPO price range. This means we can do some unpacking and thinking.
A reminder regarding why we dwell on the exit market for unicorns: We care because the value of late-stage startups when they reach a liquidity point helps set valuation comps for myriad smaller startups. Furthermore, the level of public-market enthusiasm for loss-making, growth-focused companies will determine the scale of returns for many a venture capitalist, founder and early employee.
So, let’s talk about SentinelOne’s cybersecurity IPO price range; Sprinklr’s social-media software debut will play foil.
The price of growth
It can make good sense to pay up for a quickly growing company’s shares. This is why you may hear of a startup raising an early-stage round at a very high revenue multiple.
Why put a $50 million price tag on a startup that just crossed the $1 million annual recurring revenue (ARR) threshold? If it’s growing sufficiently quickly, the math can pencil out. If that startup was growing at 300% per year, say, the revenue multiple that you paid in the round valuing the startup at $50 million would fall sharply over the next year, at which point other investors would probably scramble to put more capital into the firm at a higher price.
Bingo! You just got a markup on your initial investment, and the company has found someone else to lead their next round at a higher price, giving it even more capital to keep its growth game going and make your early investment appear prescient. See? Venture capital is easy.1
The same general idea applies to companies going public. Growth matters, and the more rapidly a company is adding revenue, the more money it will be worth because investors can anticipate its future scale (within reason). Some companies that sport quick growth can have other issues that impact their value. Extensive debt, for example, a history of uneven growth, or deteriorating economics could come into play. Or simply very high losses.
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Product design expert Scott Tong will join us at TC Early Stage in July
Thoughtful and high-quality product design is no longer optional. Gone are the days that a startup could launch with a bare-bones app or website. The demand side of the design equation has only grown — consumers are used to beautiful, intuitive products — while the supply side is struggling to keep up.
How are startups supposed to educate themselves in product design, hire the right people for those positions and think about product design as a core piece of their business?
A good starting point is an upcoming TC Early Stage: Marketing & Fundraising session with Scott Tong on July 8 & 9.
Tong was a principal designer at IDEO, a co-founder at IFTTT, head of product design at Pinterest, an EIR at IMO Ventures and is now a startup advisor at Design Fund.
When it comes to thoughtfully crafting products, and ensuring that those designs fit in line with the company’s broader short and long-term goals, there is perhaps no one better suited to show us how it’s done.
Tong joins a long list of experts in a variety of startup core competencies who will be speaking at TC Early Stage in July. That list includes Sequoia’s Mike Vernal (Product Market Fit Is All About Tempo), Coatue’s Caryn Marooney (formerly Facebook’s head of comms) and Superhuman’s Rahul Vohra (Growth Hacking). You can check out the agenda here.
The coolest part of TC Early Stage is that all sessions are designed with plenty of time for audience Q&A, so founders can get specific, tailored advice about their own business challenges.
These mini-bootcamps kick off in just two weeks so we hope you’ll be joining us at TC Early Stage— Grab your ticket here!
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Emergence’s Lotti Siniscalco and Retail Zipline’s Melissa Wong will join us on Extra Crunch Live
For all that’s said about fundraising and working alongside investors, rarely do we get to see founders and their investors in candid conversation with one another. Extra Crunch Live is changing that. On the weekly live show, we sit down with founders and the VCs who funded them to talk about how they came together on the deal, what stood out about the other party that led to their commitment and how they operate today. We also (usually) take a walk through their early pitch decks to get a feel for how success starts.
On an upcoming episode of Extra Crunch Live, we’ll sit down with Emergence’s Lotti Siniscalco and Retail Zipline’s Melissa Wong to discuss all that and more. The event goes down on Wednesday, June 23 at 3 p.m. ET/noon PT. You can register to attend right here.
Siniscalco is a principal at Emergence Capital, investing in early-stage enterprise software companies. She currently serves on the board of directors at Whistic and High Alpha. Prior to Emergence, she was an investor in financial services and technology at Advent International, a PE firm, and led diligence for Ribbit Capital (also fintech focused) before that.
In other words, she’s an expert in fintech and can bring a wealth of wisdom to our conversation around fundraising and startup growth.
Melissa Wong, on the other hand, has spent 10 years in retail communications at Old Navy. It was here that she realized a problem that Zipline Retail, a retail communication and store execution platform, could solve and set out on her own venture.
Extra Crunch Live also features the ECL Pitch-off, where startups in the audience can virtually “raise their hand” to pitch their startup live on our stream. Our expert guests will give their feedback on each pitch. If you want to throw your hat in the ring, you have to show up.
Extra Crunch Live is accessible to everyone, but only Extra Crunch members can access the content on demand. We do these every week, so there are scores of episodes across a wide variety of startup sectors in the ECL Library. It’s but one of many reasons to become an Extra Crunch member. Join here.
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Dear Sophie: What options would allow me to start something on my own?
Here’s another edition of “Dear Sophie,” the advice column that answers immigration-related questions about working at technology companies.
“Your questions are vital to the spread of knowledge that allows people all over the world to rise above borders and pursue their dreams,” says Sophie Alcorn, a Silicon Valley immigration attorney. “Whether you’re in people ops, a founder or seeking a job in Silicon Valley, I would love to answer your questions in my next column.”
Extra Crunch members receive access to weekly “Dear Sophie” columns; use promo code ALCORN to purchase a one- or two-year subscription for 50% off.
Dear Sophie,
I’ve been working on an H-1B in the U.S. for nearly two years. While I’m grateful to have made it through the H-1B lottery and to be working, I’m feeling unhappy and frustrated with my job.
I really want to start something of my own and work on my own terms in the United States. Are there any immigration options that would allow me to do that?
— Seeking Satisfaction
Dear Seeking,
Job dissatisfaction and frustration while on H-1B is normal, according to Edward Gorbis. He is the founder of Career Meets World and a performance coach who specifically works with immigrants and first-generation professionals to help them find fulfillment and thrive in their careers and life. I recently spoke with him for my podcast, “Immigration Law For Tech Startups.”
He says that “once immigrants reach stability, they start to think, ‘Who am I, what do I value, what’s my core identity?’” He partners with people to help them to gain a better understanding of why they think the way they do, teach them how our brain really works, and then reshape and retrain the brain for success.
Gorbis says that imagining overcoming the hurdles that stand in the way of doing the work that will fulfill you is the first step. So, here are some options that can help you imagine how to move toward building the life of your dreams.
Image Credits: Joanna Buniak / Sophie Alcorn (opens in a new window)
Raise $250,000 and be the CEO
A great new option for aspiring entrepreneurs is International Entrepreneur Parole, a new immigration program in the United States that allows CEOs, CTOs and others to obtain a 2.5-year immigration status. You can live in the U.S. and run your company. Your spouse can work and you could be eligible for a 2.5-year extension.
How to qualify? You’ll need to own at least 10% of a U.S. company, such as a Delaware C corporation registered in California. Ideally, you’ll want to show that your company bank account has at least $250,000 raised from qualifying U.S. investors prior to applying, but you can demonstrate other evidence to show that your company has the potential to grow rapidly and create jobs in the U.S.
See yourself at another company
There is technically no limit on how many H-1B employers you can have or how many hours you work — or how few hours you work — in an H-1B position. So, think about other companies.
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How many lives does Bitcoin have?
Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.
For this week’s deep dive Danny, Alex, and a bunch of the TechCrunch crew took on the recent happenings in the world of Bitcoin. In a break from our regular format, we recorded live from a Twitter Space — it’s like a Clubhouse, but closer to where your social network is — so the audio quality is not going to be Utterly Perfect. But we think the conversation will more than make up for it!
Before we get into the show notes, do not forget that we’re recording Equity live on Hopin Thursday the 24th. Come hang with us and have some fun. It’s free, of course, and should be a good time. Details here, sign up here!
So what did we get into? A lot!
- Recent price changes to the value of major coins.
- The impact of China on the larger crypto ecosystem.
- What’s the latest from the NFT craze?
- Are DAOs, you know, actually a thing?
And more. A big thanks to Romain Dillet and Lucas Matney for hanging with us, Drew Olanoff for hosting and Chris Gates for snagging the audio and making it all work.
See you tomorrow!
Equity drops every Monday at 7:00 a.m. PST, Wednesday, and Friday morning at 7:00 a.m. PST, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.
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