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Y Combinator-backed Adra wants to turn all dentists into cavity-finding ‘super dentists’
Like other areas of healthcare, the dental industry is steadily embracing technology. But while much of it is in the orthodontic realm, other startups, like Adra, are bringing artificial intelligence into a dentist’s day-to-day workflow, particularly in finding cavities, of what will be a $435.08 billion global dental services market this year.
The Singapore-based company was founded in 2021, but was an idea that started last year. Co-founder Hamed Fesharaki has been a dentist for over a decade and owns two clinics in Singapore.
He said dentists learn to read X-rays in dental school, but it can take a few years to get good at it. Dentists also often have just minutes to read them as they hop between patients.
As a result, dentists end up misdiagnosing cavities up to 40% of the time, co-founder Yasaman Nematbakhsh said. Her background is in imaging, where she developed an artificial intelligence machine identifying hard-to-see cancers, something Fesharaki thought could also be applied to dental medicine.
Providing the perspective of a more experienced dentist, Adra’s intent is to make every dentist “a super dentist,” Fesharaki told TechCrunch. Its software detects cavities and other dental problems on dental X-rays faster and 25% more accurately, so that clinics can use that time to better serve patients and increase revenue.
Example of Adra’s software. Image Credits: Adra
“We are coming from the eye of an experienced dentist to help illustrate the problems by turning the X-rays into images to better understand what to look for,” he added. “Ultimately, the dentist has the final say, but we bring the experience element to help them compare and give them suggestions.”
By quickly pointing out the problem and the extent of it, dentists can decide in what way they want to treat it — for example, do a filling, a fluoride treatment or wait.
Along with third co-founder Shifeng Chen, the company is finishing up its time in Y Combinator’s summer cohort and has raised $250,000 so far. Fesharaki intends to do more formalized seed fundraising and wants to bring on more engineers to tackle user experience and add more features.
The company has a few clinics doing pilots and wants to attract more as it moves toward a U.S. Food and Drug Administration clearance. Fesharaki expects it to take six to nine months to receive the clearance, and then Adra will be able to hit the market in late 2022 or early 2023.
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Y Combinator, 500 Startups, Plug and Play invest in Odiggo’s $2.2M seed round
Servicing one’s car personally is a time-consuming, expensive and painstaking process. It’s a cycle that can lead to more expensive repairs and safety issues down the line, and no car owner likes that.
Egypt and Dubai-based auto tech startup Odiggo is a platform addressing this problem. It allows car owners to get the help they need by finding car services and parts suppliers from providers around them. Then for the suppliers, it increases their sales and reaches more customers without necessarily spending on marketing.
Odiggo is part of the current YC Summer batch and has secured a $2.2 million seed round before Demo Day. The rosters of existing investors participating in the round are Y Combinator, 500 Startups, and Plug and Play Ventures. Regional VCs like Seedra Ventures, LoftyInc Capital, and Essa Al-Saleh (CEO of Volta-Tucks) also took part.
Ahmed Omar and Ahmed Nasser launched Odiggo in December 2019. The company operates a marketplace that connects car owners with service providers who can solve their problems, from servicing and repair to washing and maintenance. A commission-based model is used and Odiggo charges the car suppliers 20% commission on every transaction.
Over 50,000 car owners across three markets — Egypt, the UAE and Saudi Arabia — use Odiggo. The company also works directly with over 300 merchants. It claims merchant numbers have grown 40% month-on-month while its user base has increased 200% since the start of the pandemic.
“We believe we are at a watershed moment. It is incredible that since COVID hit, Odiggo has experienced over 10 times growth in the last year,” said co-founder Omar.
CEO Omar said with this new round, Odiggo’s priority will be to attain consistent growth while expanding its team across the UEA, Saudi Arabia and Egypt.
L-R: Ahmed Nassir (co-founder) & Ahmed Omar (co-founder and CEO)
He adds that since Odiggo taps into a mix of data sources — including car metrics and internal software, it will use that same information to provide more product offerings.
Odiggo will use part of the funding to continue developing its tech and dashboard software, he said.
“For example, the platform would be hooked up to the car owner’s vehicle and link the vehicle to the marketplace and provide frequent updates of your vehicle condition so you’ll be informed if the tires are low, the oil needs changing, or if a service is required.”
The pandemic has upended the mobility and logistics sectors, especially in MENA, making players like Odiggo gain much visibility from investors. In an industry today worth over $61 billion in the Middle East and Africa alone, Odiggo is looking to become a market leader. It has even more lofty plans to go public in the next three years.
“We are also aiming to be fully focused on spending more on our product and technology, as building an ecosystem to monetize requires more capital. Our target is to go for IPO by 2024 and achieve one billion services booked, and this requires a lot of network effects, infrastructure and technology,” the CEO said.
“We aim to be the first $100 billion company coming out of the region,” added Nasser.
Some of its investors, Idris Ayodeji Bello, managing partner at LoftyInc, and Essa Al-Saleh, are onboard with the startup’s plan despite early days.
“We are excited to back Odiggo through our Afropreneurs Funds in its quest to transform the automotive parts market and provide superior service to clients, starting from MENA. The leadership team of Omar and Nasser, supported by the rest of the employees, have been a joy to work with and we are on a countdown to the IPO,” said Bello in a statement.
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Get your pitch-off on with our Disrupt Startup Alley companies on upcoming episodes of Extra Crunch Live
Disrupt is right around the corner, and this year the show is packed to the brim with incredible panels and conversations, an absolutely stacked Startup Battlefield cohort of companies launching on our stage, investor insights and a virtual expo hall full of exciting new products and services in the Startup Alley.
We can’t wait! Literally. So we’re giving you guys a sneak peek at some of the startups you might see at Disrupt in upcoming episodes of Extra Crunch Live.
Usually, the Extra Crunch Live crew sits down with founders and the investors who finance them to learn how they decided to partner with one another and, ultimately, how startups can get to “yes” when fundraising. In the latter half of the episode, those same guests give live feedback to folks in the audience who come on our virtual stage and pitch their products.
Truth be told, everyone loves a good pitch-off. So in these upcoming Startup Alley Edition episodes of Extra Crunch Live, we’re turning the entire episode into a pitch-off. SUA companies will come on stage, one at a time, and have exactly 60 seconds to get us excited about their startup. But it wouldn’t be a true pitch-off without some expert feedback.
I’m excited to announce the investors joining us on these episodes to share their insights and wisdom with both the startups and the audience.
Image Credits: Elena Zhukova / Scale Venture Partners
Sequeira was managing director at General Catalyst before venturing out to start Defy. Before GC, he was at TimeWarner Investments and was a founding member of AOLTW Ventures. Defy has a portfolio that includes Dropcam, Nest, Bustle and more. Sequeira has served on more than 40 company boards, so it should go without saying that he’ll have plenty of insightful feedback for our founders.
Bishop brings more than 20 years of investment experience to our little pitch-off. She currently serves on the boards of Abstract, Airspace, Demandbase, Extole, Lever and more. Bishop has also served on several boards where the company has seen a successful exit, including HubSpot, Bizible and Vitrue. Bishop specializes in business applications and will have lots to share with our pitch-off startups. Register here for Extra Crunch Live with defy.vc and Scale Venture Partners.
Image Credits: Next47 / Amanda Aude
Ananth serves as founding CEO at Next47, which is backed by Siemens AG. He’s sat on several boards where he has helped the companies grow beyond $1 billion valuations. Ananth specializes in emerging areas of deep tech, including AI/ML, vertical SaaS, robotics, mobility, etc. Some of Ananth’s current investments include Verkada, rideOS and Markforged.
Katie Stanton has been an executive and an operator for much of her career, holding roles at Twitter, Google, Yahoo and Color across a wide variety of departments, including marketing, comms, recruiting, product and media. Stanton also served in the Obama White House and State Department after getting her career started as a banker at JP Morgan. She currently sits on the board of Vivendi and has invested in dozens of early-stage companies, including Airtable, Cameo, Carta, Coinbase, Literati, Modern Fertility, Shape Security and Threads. Register here for Extra Crunch Live with Next47 and Moxxie Ventures.
You don’t want to miss these episodes of Extra Crunch Live. Register (for free) to come hang out with us!
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Extra Crunch roundup: Corp dev handbook, Chicago startups, Brazil’s e-commerce landscape
If you’re a founder who finds yourself in a meeting with a VC, try to remember two things:
- You’re the smartest person in the room.
- Investors are looking for a reason to say “yes.”
Even so, many entrepreneurs squander this opportunity, often because they direct questions or fail to understand their BATNA (best alternative to a negotiated agreement).
“As the venture landscape becomes more a meritocratic environment where resumes and institutional affiliations matter less, these strategies can make the difference between a successful fundraise and a fruitless meeting,” says Agya Ventures co-founder Kunal Lunawat.
Whether you’re already in the fundraising process or plan to be in the future, be sure to read “A crash course on corporate development” that Venrock VP Todd Graham shared with us this week.
“If you’re going to get acquired, chances are you’re going to spend a lot of time with corporate development teams,” says Graham. “With a hot stock market, mountains of cash and cheap debt floating around, the environment for acquisitions is extremely rich.”
Full Extra Crunch articles are only available to members.
Use discount code ECFriday to save 20% off a one- or two-year subscription.
On Wednesday, August 24 at 3 p.m. PDT/6 p.m. EDT/11 p.m GMT, Managing Editor Danny Crichton will host a conversation on Twitter Spaces with Eric Dean Wilson, author of “After Cooling: On Freon, Global Warming, and the Terrible Cost of Comfort.”
Wilson’s book explores the history of freon, a common refrigerant that was later banned due to its devastating impact on the ozone layer. After their discussion, they’ll take questions from the audience.
Thanks very much for reading Extra Crunch this week! I hope you have an excellent weekend.
Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist
Apple is changing Mail Privacy Protection and email marketers must prepare
Image Credits: Carol Yepes (opens in a new window) / Getty Images
Apple iPhone, Apple Mail and Apple iPad account for nearly half of all email opens, but the privacy features included with iOS 15 will allow consumers to block marketers from seeing their physical location, IP address and tracking data like invisible pixels.
Email marketers rely heavily on these and other metrics, which means they should prepare now for the changes to come, advises Litmus CMO Melissa Sargeant.
In a detailed post, she shares several action items that will help marketing teams leverage their email analytics so they can “continue delivering personalized experiences consumers crave.”
Let’s make a deal: A crash course on corporate development
Image Credits: Cimmerian (opens in a new window) / Getty Images
Venrock Vice President Todd Graham has some frank advice for founders at venture-backed startups: “It would be wise to generate a return at some point.”
With that in mind, he authored a primer on corporate development that lays out the three most common categories of acquisitions, tips for dealing with bankers, and explains why striking a partnership with a big company isn’t always the best way forward.
Regardless of the path you choose, “you need to take the meeting,” advises Graham.
“In the worst-case scenario, you’ll get a few new LinkedIn connections and you’re now a known quantity. The best-case scenario will be a second meeting.”
When VCs turned to Zoom, Chicago startups were ready for their close-up
Image Credits: Nigel Sussman (opens in a new window)
The pandemic failed to slow the momentum of venture capitalists pouring money into startups, but Chicago stands out as an “outlying benefactor of accelerating venture capital activity and the rise of remote investing,” Alex Wilhelm and Anna Heim write for The Exchange.
When the world shut down and it didn’t matter if you were in NYC or SF (because everyone was on Zoom), the Windy City was ready to present itself as the venture champion of the Midwest.
What does Brazil’s new receivables regulation mean for fintechs?
Image Credits: Priscila Zambotto (opens in a new window) / Getty Images
The Brazilian Central Bank made a major reform to the way payments are processed that may throw the doors open for e-commerce in South America’s largest market.
Historically, merchants who accepted credit card payments had two options: Receive the full payment distributed over two to 12 installments, or offer a deep discount to receive a smaller sum up front.
But in June 2021, the BCB created new “registration entities” that permit “any interested receivables buyer/acquirer to make an offer for those receivables, forcing buyers to become more competitive in their discount offers,” says Leonardo Lanna, head of payment products at Monkey Exchange.
The new framework benefits consumers and sellers, but for the region’s startups, “it opens the door to a plethora of opportunities and new business models, from payments to credit.”
As its startup market accelerates, Brazil could be in for an IPO bonanza
Image Credits: Nigel Sussman (opens in a new window)
An inflow of VC dollars, notable acquisitions and rising unicorn counts are all features of the Brazilian tech startup market, Anna Heim and Alex Wilhelm note in The Exchange.
“The IPO market in Brazil is changing,” they write. “TechCrunch noted last year that in the decade leading up to 2020, just two of the 56 IPOs in Brazil were technology companies. More recently, the number of technology companies listed in the country has swelled to at least 16, up from just four in 2019.”
Insider hacks to streamline your SOC 3 certification application
Image Credits: Andriy Onufriyenko / Getty Images
“For good reason, security certifications like the SOC 3 really put you through the wringer,” Waydev CEO Alex Cercei writes in a guest column.
Waydev, a Git analytics tool that helps engineering leaders measure team performance automatically, just attained the SOC 3 certification.
“We learned so much from the process, we felt it was right to share our experience with others that might be daunted by the prospect,” Cercei writes.
“So here’s our advice on how teams can smoothly reach an SOC 3 while simultaneously balancing workloads and minimizing disruption to users.”
Dear Sophie: Tips on EB-1A and EB-2 NIW?
Image Credits: Bryce Durbin/TechCrunch
Dear Sophie,
I’m on an H-1B living and working in the U.S. I want to apply for a green card on my own. I’m concerned about only relying on my current employer and I want to be able to easily change jobs or create a startup. I’ve been looking at the EB-1A and EB-2 NIW.
I’m not sure if I would qualify for an EB-1A, but since I was born in India, I face a much longer wait for an EB-2 NIW.
Any tips on how to proceed?
— Inventive from India
How to establish a health tech startup advisory board
Image Credits: Cordelia Molloy Science Photo Library (opens in a new window) / Getty Images
Most startups could use an advisory board, but in health tech, it’s a core requirement.
Founders seeking to innovate in this area have a unique need for mentors who have experience navigating regulations, raising capital and managing R&D, to name just a few areas.
Based on his own experience, Patrick Frank, co-founder and COO of PatientPartner, shared some very specific ideas about who to recruit, where to find them and how to fit them into your cap table.
“You want to leverage these individuals so you are able to focus on the full view of the company to ensure it is something that both the market and investors want at scale,” says Frank.
Crypto world shows signs of being rather bullish
Image Credits: Nigel Sussman (opens in a new window)
There’s no shortage of tech news to analyze, Alex Wilhelm notes, but this week, he took a fresh look at crypto.
How come?
“Because there are some rather bullish trends that indicate the world of blockchain is maturing and creating a raft of winning players,” he writes.
4 common mistakes startups make when setting pay for hybrid workers
Image Credits: kentoh (opens in a new window) / Getty Images (Image has been modified)
In one recent survey, 58% of workers said they plan to quit if they’re not allowed to work remotely.
Startups that don’t offer employees work-from-home flexibility are at a competitive disadvantage, but figuring out how to pay hybrid workers raises a complex set of questions:
- Should you localize salaries for workers in different areas?
- How should you pay workers who have the same job when one is WFH and the other is at their desk?
- Are you being transparent with your staff about how their compensation is set?
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Bird shows improving scooter economics, long march to profitability
Newly reported financial data from Bird, an American scooter sharing service, shows a company with an improving economic model and a multiyear path to profitability. However, that path is fraught unless a number of scenarios all work out in concert and without a glitch.
Bird, well known for its early battles with domestic rival Lime, is pursuing a SPAC-led deal that will see it go public and raise fresh capital. The former startup is merging with Switchback II Corporation in a deal that values it at around $2.3 billion, including a $160 million PIPE (private investment in public equity) component. (Note: The group purchasing TechCrunch’s parent company from its own parent company is part of the Bird PIPE.)
The Exchange explores startups, markets and money.
Read it every morning on Extra Crunch or get The Exchange newsletter every Saturday.
COVID-19 hasn’t been kind to Bird and similar companies around the world. As many around the world stayed home, usage of shared-asset services and ride-hail applications fell sharply. Bird saw rides decline. Airbnb took a temporary hit. Uber and Lyft saw ride demand fall.
Responses to the crisis were varied. Airbnb cut costs and raised external capital. Lyft cut expenses and focused on its core model while Uber grew its food delivery business, which saw transaction volume soar as demand fell for its traditional business.
Meanwhile, Bird flipped its entire business model. That decision has helped the scooter outfit improve its economics markedly, giving it a shot at generating profit in the future — provided its forecasts prove achievable.
This morning, let’s talk about how Bird has changed its business, their impacts on its operating results and how long the company thinks its climb to profitability is.
Fleet management → Fleet managers
In their initial forms, Bird and Lime bought and deployed large fleets of electric scooters. Not only was this capital intensive, the companies also wound up with costs that were more than sticky — charging wasn’t simple or cheap, moving scooters around to balance demand took both human capital and vehicles, and the list went on.
Throw in vehicle depreciation — the pace at which scooters in the wild degraded from use or abuse — and the businesses proved excellent vehicles for raising capital and throwing that money at more scooters, costs, and, as it turned out, losses.
Results improved somewhat over time, though. As scooter-share companies increasingly built their own hardware, their economics improved. Sturdier scooters meant lower depreciation, and better battery tech could allow for more rides per charge. That sort of thing.
But the model wasn’t incredibly lucrative even before COVID-19 hit. Costs were high, and the model did not break-even, even on a gross margin basis, let alone when considering all corporate expenses. You can see the financial mess from that period of operations in historical Bird results.
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Cardiomatics bags $3.2M for its ECG-reading AI
Poland-based health tech AI startup Cardiomatics has announced a $3.2 million seed raise to expand use of its electrocardiogram (ECG) reading automation technology.
The round is led by Central and Eastern European VC Kaya, with Nina Capital, Nova Capital and Innovation Nest also participating.
The seed raise also includes a $1 million non-equity grant from the Polish National Centre of Research and Development.
The 2017-founded startup sells a cloud tool to speed up diagnosis and drive efficiency for cardiologists, clinicians and other healthcare professionals to interpret ECGs — automating the detection and analysis of some 20 heart abnormalities and disorders with the software generating reports on scans in minutes, faster than a trained human specialist would be able to work.
Cardiomatics touts its tech as helping to democratize access to healthcare — saying the tool enables cardiologists to optimise their workflow so they can see and treat more patients. It also says it allows GPs and smaller practices to offer ECG analysis to patients without needing to refer them to specialist hospitals.
The AI tool has analyzed more than 3 million hours of ECG signals commercially to date, per the startup, which says its software is being used by more than 700 customers in 10+ countries, including Switzerland, Denmark, Germany and Poland.
The software is able to integrate with more than 25 ECG monitoring devices at this stage, and it touts offering a modern cloud software interface as a differentiator versus legacy medical software.
Asked how the accuracy of its AI’s ECG readings has been validated, the startup told us: “The data set that we use to develop algorithms contains more than 10 billion heartbeats from approximately 100,000 patients and is systematically growing. The majority of the data-sets we have built ourselves, the rest are publicly available databases.
“Ninety percent of the data is used as a training set, and 10% for algorithm validation and testing. According to the data-centric AI we attach great importance to the test sets to be sure that they contain the best possible representation of signals from our clients. We check the accuracy of the algorithms in experimental work during the continuous development of both algorithms and data with a frequency of once a month. Our clients check it everyday in clinical practice.”
Cardiomatics said it will use the seed funding to invest in product development, expand its business activities in existing markets and gear up to launch into new markets.
“Proceeds from the round will be used to support fast-paced expansion plans across Europe, including scaling up our market-leading AI technology and ensuring physicians have the best experience. We prepare the product to launch into new markets too. Our future plans include obtaining FDA certification and entering the US market,” it added.
The AI tool received European medical device certification in 2018 — although it’s worth noting that the European Union’s regulatory regime for medical devices and AI is continuing to evolve, with an update to the bloc’s Medical Devices Directive (now known as the EU Medical Device Regulation) coming into application earlier this year (May).
A new risk-based framework for applications of AI — aka the Artificial Intelligence Act — is also incoming and will likely expand compliance demands on AI health tech tools like Cardiomatics, introducing requirements such as demonstrating safety, reliability and a lack of bias in automated results.
Asked about the regulatory landscape it said: “When we launched in 2018 we were one of the first AI-based solutions approved as medical device in Europe. To stay in front of the pace we carefully observe the situation in Europe and the process of legislating a risk-based framework for regulating applications of AI. We also monitor draft regulations and requirements that may be introduced soon. In case of introducing new standards and requirements for artificial intelligence, we will immediately undertake their implementation in the company’s and product operations, as well as extending the documentation and algorithms validation with the necessary evidence for the reliability and safety of our product.”
However it also conceded that objectively measuring efficacy of ECG reading algorithms is a challenge.
“An objective assessment of the effectiveness of algorithms can be very challenging,” it told TechCrunch. “Most often it is performed on a narrow set of data from a specific group of patients, registered with only one device. We receive signals from various groups of patients, coming from different recorders. We are working on this method of assessing effectiveness. Our algorithms, which would allow them to reliably evaluate their performance regardless of various factors accompanying the study, including the recording device or the social group on which it would be tested.”
“When analysis is performed by a physician, ECG interpretation is a function of experience, rules and art. When a human interprets an ECG, they see a curve. It works on a visual layer. An algorithm sees a stream of numbers instead of a picture, so the task becomes a mathematical problem. But, ultimately, you cannot build effective algorithms without knowledge of the domain,” it added. “This knowledge and the experience of our medical team are a piece of art in Cardiomatics. We shouldn’t forget that algorithms are also trained on the data generated by cardiologists. There is a strong correlation between the experience of medical professionals and machine learning.”
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Greycroft leads $3.5M into Breef, an online marketplace for ad agencies
Breef raised $3.5 million in funding to continue developing what it boasts as “the world’s first online marketplace” for transactions between brands and agencies.
Greycroft led the round and was joined by Rackhouse Ventures, The House Fund, John and Helen McBain, Lance Armstrong and 640 Oxford Ventures. Including the new round, the New York and Colorado-based company has brought in total funding of $4.5 million since its inception in 2019 by husband-and-wife co-founders George Raptis and Emily Bibb.
Bibb’s background is in digital marketing and brand building at companies like PopSugar, VSCO and S’well, while Raptis was on the founding team at fintech company Credible.com.
Both said they experienced challenges in finding agencies, which traditionally involved asking for referrals and then making a bunch of calls. There were also times when their companies would be in high demand for talent, but didn’t necessarily need a full-time employee to achieve the goal or project milestone.
While the concept of outsourcing is not new, Breef’s differentiator is its ability to manage complex projects: a traditional individual freelance project is less than $1,000 and takes a week or less. Instead, the company is working with team-based projects that average $25,000 with a length of engagement of about six months, Raptis said.
Breef’s platform is democratizing how brands and boutique agencies connect with each other in the process of planning, scoping, pitching and paying for projects, Raptis told TechCrunch.
“At the core, we are taking the agency online,” Bibb added. “We are building a platform to streamline a complicated process for outsourcing high-value work and allow users to find, pay for and work with agencies in days rather than months.”
Brands can draft their own brief to articulate what they need, and Breef will connect them to a short list of agencies that match those requirements. Rather than a one- or two-month search, the company is able to bring that down to five days.
Bibb and Raptis decided to seek venture capital after experiencing demand — millions of dollars in projects are being created on the platform each month — and some tailwinds from the shift to remote work. They saw many brands that may have originally utilized in-house teams or agencies of record turn to distributed or smaller teams.
Due to the nature of agency work being expensive, Breef is processing large amounts of money over the internet, and the founders want to continue developing the technology and hiring talent so that it is a secure and trustworthy system.
It also launched its buy now, pay later project funding service, Breef(pay), to streamline payments to agencies and reduce cash flow challenges. Users can construct their own payment terms, mix up the way they are paid and utilize a credit line or defer payments to control external spend.
To date, Breef has more than 5,000 vetted boutique agencies in 20 countries on its platform and is able to save its users an average of 32% in product costs compared with a traditional agency model. It boasts a customer list that includes Spotify, Brex, Shutterstock, Bluestone Lane and Kinrgy.
Kevin Novak, founder of Rackhouse Ventures, said he met Raptis through the Australian tech community. He recently launched his first fund targeting startups in novel applications of data.
“When they were talking to me about what they wanted to do, I got intrigued,” Novak said. “I like finding marketplaces where the idea is well understood by the people involved. Looking at the matching problem, Emily and George have found a unique way to find ad agencies that hasn’t existed before.”
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Rutter comes out of stealth with $1.5M in funding for its e-commerce API
Rutter, a remote-first company, is developing a unified e-commerce API that enables companies to connect with data across any platform.
On Friday the company announced it was emerging from stealth with $1.5 million in funding from a group of investors including Haystack, Liquid 2 and Basis Set Ventures.
Founders Eric Yu and Peter Zhou met in school and started working on Rutter, which Zhou called “Plaid for commerce,” in 2017 before going through the summer 2019 Y Combinator cohort.
They stumbled upon the e-commerce API idea while working in education technology last year. The pair were creating subscription kits and learning materials for parents concerned about how their children would be learning during the global pandemic. Then their vendor customers had problems listing their storefronts on Amazon, so they wrote scripts to help them, but found that they had to write separate scripts for each platform.
With Rutter, customers only need one script to connect anywhere. Its APIs connect to e-commerce platforms like Shopify, Walmart and Amazon so that tech customers can build functions like customer support and chatbots, Yu told TechCrunch.
Lan Xuezhao, founding and managing partner of Basis Set Ventures, said via email that she was “super excited” about Rutter first because of the founders’ passion, grit and speed of iteration to a product. She added it reminded her of another team that successfully built a business from zero to over $7 billion.
“After watching them (Rutter) for a few years, it’s clear what they built is powerful: it’s the central nervous system of online commerce,” Xuezhao added.
As the founders see it, there are two big explosions going on in e-commerce: the platform side with the adoption of headless commerce — the separating of front end and back end functions of an e-commerce site, and new companies coming in to support merchants.
The new funding will enable Yu and Zhou to build up their team, including hiring more engineers.
Due to the company officially launching at the beginning of the year, Yu did not disclose revenue metrics, but did say that Rutter’s API volume was doubling and tripling in the last few months. It is also supporting merchants that connect with over 5,000 stores.
Some of Rutter’s customers are building one aspect of commerce, like returns, warranties and checkouts, but Yu said that since Shopify represents just 10% of e-commerce, the company’s goal is to take merchants beyond the marketplace by being “that unified app store for merchants to find products.”
“We think that in the future, the e-commerce stack of a merchant will look like the SaaS stack of a software company,” Zhou added. “We want to be the glue that holds that stack together for merchants.”
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Communication software startup Channels takes on event management with text workflow
Three University of Michigan students are building Channels Inc., a communication software tailored for physical workers, and already racking up some big customers in the event management industry.
Siddharth Kaul, 18, Elan Rosen, 20, and Ibrahim Mohammed, 20, started the company after finding some common ground in retail and events. The company’s customer list boasts names like Marriott Hotels, and it announced a $520,000 seed round, led by Sahra Growth Capital, to give it nearly $570,000 in total funding.
Kaul grew up going to a lot of events in Kuwait and Dubai, but started noticing there was a delay in things that should happen and many processes were being done on pen and paper.
“The technology that was available was inharmonious and made it hard for physical workers to fulfill tasks,” Kaul told TechCrunch. “We saw it happening in the event management space, forcing workers to coordinate across technologies.”
Legacy communication platforms like Slack are aggregating communications, but are better for remote workers; for physical workers, they rely more on text communication, he said. However, the disadvantage with texting is that you have to keep scrolling to get to the new message, and old communication is lost amid all of the replies.
They began developing a platform for small hotels to help them transition to digital and provide communication in a non-chronological order that is easier to access, enables discussion and can be searched. Users of the SaaS platform can build live personnel maps to see where employees are and what the event floor looks like, prioritize alerts and automate tasks while monitoring progress.
Marriott became a customer after one of its employees saw the Channels platform was being tested at an event. He saw employees pulling out their phones and asked the manager why they were doing that, and was told they were testing out the product and referred him to Kaul.
“What they thought was helpful was that it was communication, and though the employees were checking their phones, it was quick and they remained attentive,” Kaul said.
Channels provides a solid platform in terms of analytics and graphical representation, which is a major selling point for customers, leading to initial traction and revenue for the company that Rosen said he expects can occur at the convention level the company is striving for.
The new funding will be used to grow in development and bring additional engineering talent to the team. In addition, it will allow Kaul and Rosen to continue with their studies, while Mohammed will be doing more full-time work. They want to increase their recurring revenue in the Middle East while building up operations in the United States.
Jamal Al-Barrak, managing partner of Sahra Growth Capital, said Channels was on his firm’s radar ever since they won the 2020 Dubai X-Series competition it sponsors. As a result of winning the competition, he was able to see the founders on multiple occasions and hear their growth.
Sahra doesn’t typically invest in companies like Channels, but the firm started a “seed sourcing effort” to make investments of between $200,000 and $800,000 into early-stage companies, Al-Barrak said. Channels is one of the first investments with that effort.
“Channels is one of our first investments in this initiative and they look very promising so far even compared to our investments before we started this initiative,” Al-Barrak said. He liked the founders’ work ethic and their focus on the event industry, which he called, “historically outdated and bereft of technological innovation.”
“Sid, Elan and Ibrahim are some of the youngest yet brightest entrepreneurs I have come across to this day and I have invested in over 25 technology startups,” he said. “Additionally, I enjoyed that they had proof of concept with a prior customer base and revenue. I was most impressed by their vision past their current industry and bounds as they want to encapsulate communication for all physical workers, whether it is events, retail or more.”
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Indonesian D2C insurance marketplace Lifepal raises $9M Series A
Choosing an insurance policy is one of the most complicated financial decisions a person can make. Jakarta-based Lifepal wants to simplify the process for Indonesians with a marketplace that lets users compare policies from more than 50 providers, get help from licensed agents and file claims. The startup, which says it is the country’s largest direct-to-consumer insurance marketplace, announced today it has raised a $9 million Series A. The round was led by ProBatus Capital, a venture firm backed by Prudential Financial, with participation from Cathay Innovation and returning investors Insignia Venture Partners, ATM Capital and Hustle Fund.
Lifepal was founded in 2019 by former Lazada executives Giacomo Ficari and Nicolo Robba, along with Benny Fajarai and Reza Muhammed. The new funding brings its total raised to $12 million.
The marketplace’s partners currently offer about 300 policies for life, health, automotive, property and travel coverage. Ficari, who also co-founded neobank Aspire, told TechCrunch that Lifepal was created to make comparing, buying and claiming insurance as simple as shopping online.
“The same kind of experience a customer has today on a marketplace like Lazada—the convenience, all digital, fast delivery—we saw was lacking in insurance, which is still operating with offline, face-to-face agents like 20 to 30 years ago,” he said.
Indonesia’s insurance penetration rate is only about 3%, but the market is growing along with the country’s gross domestic product thanks to a larger middle-class. “We are really at a tipping point for GDP per capita and a lot of insurance carriers are focusing more on Indonesia,” said Ficari.
Other venture-backed insurtech startups tapping into this demand include Fuse, PasarPolis and Qoala. Both Qoala and PasarPolis focus on “micro-policies,” or inexpensive coverage for things like damaged devices. PasarPolis also partners with Gojek to offer health and accident insurance to drivers. Fuse, meanwhile, insurance specialists an online platform to run their businesses.
Lifepal takes a different approach because it doesn’t sell micro-policies, and its marketplace is for customers to purchase directly from providers, not through agents.
Based on Lifepal’s data, about 60% of its health and life insurance customers are buying coverage for the first time. On the other hand, many automotive insurance shoppers had policies before, but their coverage expired and they decided to shop online instead of going to an agent to get a new one.
Ficari said Lifepal’s target customers overlap with the investment apps that are gaining traction among Indonesia’s growing middle class (like Ajaib, Pluang and Pintu). Many of these apps provide educational content, since their customers are usually millennials investing for the first time, and Lifepal takes a similar approach. Its content side, called Lifepal Media, focuses on articles for people who are researching insurance policies and related topics like personal financial planning. The company says its site, including its blog, now has about 4 million monthly visitors, creating a funnel for its marketplace.
While one of Lifepal’s benefits is enabling people to compare policies on their own, many also rely on its customer support line, which is staffed by licensed insurance agents. In fact, Ficari said about 90% of its customers use it.
“What we realize is that insurance is complicated and it’s expensive,” said Ficari. “People want to take their time to think and they have a lot of questions, so we introduced good customer support.” He added Lifepal’s combination of enabling self-research while providing support is similar to the approach taken by PolicyBazaar in India, one of the country’s largest insurance aggregators.
To keep its business model scalable, Lifepal uses a recommendation engine that matches potential customers with policies and customer support representatives. It considers data points like budget (based on Lifepal’s research, its customers usually spend about 3% to 5% of their yearly income on insurance), age, gender, family composition and if they have purchased insurance before.
Lifepal’s investment from ProBatus will allow it to work with Assurance IQ, the insurance sales automation platform acquired by Prudential Financial two years ago.
In a statement, ProBatus Capital founder and managing partner Ramneek Gupta said Lifepal’s “three-pronged approach” (its educational content, online marketplace and live agents for customer support) has the “potential to change the way the Indonesian consumer buys insurance.”
Part of Lifepal’s funding will be used to build products to make it easier to claim policies. Upcoming products include Insurance Wallet, which will include an application process with support on how to claim a policy—for example, what car repair shop or hospital a customer should go to—and escalation if a claim is rejected. Another product, called Easy Claim, will automate the claim process.
“The goal is to stay end-to-end with the customer, from reading content, comparing policies, buying and then renewing and using them, so you really see people sticking around,” said Ficari.
Lifepal is Cathay Innovation’s third insurtech investment in the past 12 months. Investment director Rajive Keshup told TechCrunch in an email that it backed Lifepal because “the company grew phenomenally last year (12X) and is poised to beat its aggressive 2021 plan despite the proliferation of the COVID delta variant, accentuating the fact that Lifepal is very much on track to replicate the success of similar global models such as Assurance IQ (US) and PolicyBazaar (India).”
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