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My big jump: Sukhinder Singh Cassidy’s CEO journey
After listening to others pitch me a few different job opportunities while still at Google in 2008, it became clear to me that I would make a better decision if I could fully explore the larger landscape of new companies emerging in Silicon Valley.
I had spent the last several years focusing on Google’s business outside the U.S., and I honestly felt out of touch with the startup world. Beyond my goal of becoming a CEO of my own company, I had two other ambitions: I wanted to help build a great consumer service that would delight people (potentially in e-commerce) and I wanted to build further wealth for myself and my family.
To better evaluate my options, I made the decision to quit Google first and find a way to study the wider ecosystem of companies before choosing where to go. Resolved to give myself a “blank slate” before making a final choice, I left Google when I was three months pregnant and joined Accel Partners, a top Silicon Valley venture capital firm and an investor in my previous startup, in a temporary role as CEO-in-residence.
In the months that followed, I helped Accel evaluate investment opportunities across a wide variety of digital sectors, with a particular focus on e-commerce, taking the opportunity to study those companies I might join or think of starting from scratch.
On Thursday, August 19 at 2 p.m. PDT/5 p.m. EDT/9 p.m. UTC
Managing Editor Danny Crichton will interview Sukhinder Singh Cassidy, author of “Choose Possibility,” on Twitter Spaces.
One of Accel’s key partners, Theresia Gouw, helped me brainstorm, joining my cadre of professional priests. We had known one another for over a decade (I originally met her as a young founder at Yodlee) and were at similar stages of our careers, so I knew she could identify personally with my career quandaries. Like me, Theresia was pregnant with her next child and at a similar life stage — yet another commonality.
Image Credits: Sukhinder Singh Cassidy
While at Accel, I spent a disproportionate amount of time testing my macro thesis that online shopping was about to explode in new ways. I had seen the rise of e-tailers at Google (many of these companies, such as eBay and Amazon, were Google’s largest advertisers at the time), but many of the leading e-commerce sites like Amazon and Zappos still had a utilitarian feel to them.
Meanwhile, new fashion and décor e-commerce sites such as Rent the Runway, Gilt, Houzz, Wayfair and One Kings Lane were popping up everywhere and growing rapidly. These sites sought to tap into a more aspirational and entertainment-oriented kind of shopping experience and move it online.
Expert investors like Accel and others were funding them, and my own observations suggested that this area would yield another big wave of online consumer growth. These lifestyle categories of shopping also appealed to me personally; I was the target customer for many of them.
I started to work on an idea for a new e-commerce service, a luxury version of eBay, while listening to the pitches of every e-commerce company that was looking for funding and talking to several that needed early-stage CEOs. I continued to listen to non-e-commerce pitches as well, simply to give myself a point of reference for evaluating online shopping opportunities.
At Yodlee and Google, I had been lucky enough to work with incredibly smart and talented people who shared my values, and I wanted to do the same at my next venture.
I wanted to work with great investors, too, and fortunately I had the ability either to work with Accel-funded companies, start my own or leverage other investor relationships I’d developed. I spent time with multiple company founders to try to discern who they were as leaders, in addition to what they were working on.
By this point in my career, I had a pretty clear idea of my own superpowers and values, so I looked to find companies that could make the most of my unique gifts and whose founders or senior leaders had strengths complementary to mine.
Specifically, I hoped to join a company with a very strong engineering and product management culture that needed a CEO with strategy, vision, business development, fundraising and team-building expertise. Applying these criteria, I turned down several opportunities at companies whose founders had skill sets too similar to mine, reasoning that this overlap might lead to conflict if I ever became CEO.
Finally, I used my time at Accel to think long and hard about the risks I would take in becoming a startup CEO and whether I could afford to fail. My biggest risk by far was ego- and reputation-related. Mindful of how precarious early-stage startups are, I feared that I would leave a successful role as a global executive only to suffer a very large and visible failure. But the more I thought about this, I faced this ego risk head-on and concluded that my reputation as an executive from Google would hopefully be strong enough to survive one failure if it came to that.
The personal risks of taking on a startup CEO role felt different but not greater than those associated with my job at Google. While I knew that serving as a first-time CEO while having another newborn at home (my son Kieran) would be immensely stressful, I would likely benefit from no longer traveling around the world for days and weeks on end and working across multiple time zones, as I had previously.
Last, I evaluated the financial risks of potential moves. Although my startup equity would have uncertain value for a long time, I judged this a risk worth taking, given how excited I’d feel to have more impact and responsibility as CEO. While I lost a large financial package in choosing to leave Google and switching to a startup salary, I could pay the bills at home while digging into my savings only slightly. Under these conditions, I was prepared to make the leap.
In early 2010, almost a year after I left Google, I finally found the right opportunity and decided to join fashion technology startup Polyvore as its full-time CEO. A precursor to Pinterest, Polyvore was based on the idea that women could “clip” online images to create fashion and décor idea boards digitally that were instantly “shoppable.”
Millions of young women (including influencers) were already using the service and loved it. The founding team was led by a rock star engineer, Pasha Sadri, along with three other product and technology folks he recruited from the likes of Yahoo and Google.
Pasha was known for his intelligence, and we had connected informally over the years for coffee, each time having great discussions about business strategy. In fact, Polyvore twice before had tried to recruit me to become its CEO, once when I was at Google and again when I departed that company in 2008. Back then, I’d spent a productive afternoon with the founding team, helping them think through their business model. I also knew Peter Fenton, one of Silicon Valley’s most successful investors and a leading funder of the company. Peter was the one who first introduced me to Polyvore and who continued afterward to passively court me.
Having spent so much time exploring my options from multiple angles, I was now poised to make a great decision. I felt convinced that e-commerce was starting its next wave of growth, and felt excited to be part of it.
Within that vision, Polyvore was among the companies best positioned to succeed, and I knew I could contribute in significant ways to building a service that would delight millions. I was impressed with the strengths of Polyvore’s founder and investors and anticipated that I would be able to complement their efforts nicely. Recognizing that my success as a startup CEO hinged on my relationships with the founder and board, I had also invested time to get to know them.
Meanwhile, I had faced my fear demons, taking financial risk but negotiating my offer aggressively to account for downside scenarios I imagined, and coming to grips with my ego risk. With all this work in place, I finally jumped.
After managing a multibillion-dollar profit and loss and leading a 2,000-person team at Google, I became the newly minted CEO of a 10-person fashion startup in February 2010.
As we tee up the bigger choices in our careers, we all face critical moments of decision. No choice we make will be perfect, and all the frameworks in the world won’t eliminate risk entirely. But we don’t need perfection or freedom from risk. We just need to take the next step.
By choosing thoughtfully, using all the tools at our disposal to maximize our upside and anticipate our downside, we can grasp the opportunities available to us while equipping ourselves to handle whatever challenges reality throws our way.
Excerpted from “Choose Possibility: Take Risks and Thrive (Even When You Fail)’ by Sukhinder Singh Cassidy. Copyright © 2021 by Sukhinder Singh Cassidy. Published and reprinted by permission of Mariner Books/Houghton Mifflin Harcourt. All rights reserved.
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Delightree raises $3M to help franchise business owners simplify their operations
Owning one brick-and-mortar business seems complicated enough. But running multiple locations? For many owners, that’s a constant juggling act of phone calls, check lists and driving back and forth from store to store. In the middle of a pandemic, it gets all the more complex.
Delightree, a company out of the previous Alchemist Accelerator class, has raised $3 million to build a tool hyper-focused on helping owners of franchise businesses (think hotels, gyms, restaurant chains, etc.) take their operations and workflows digital.
A big part of the idea with Delightree is to move much of what currently happens through pen-and-paper checklists over to smartphones, allowing franchise owners to know what’s going at their locations from afar. They digitize workflows like the daily store opening/closing procedures or maintenance routines, with employees checking boxes on their devices rather than a paper to-do list. If something gets missed along the way, Delightree can automatically ping the owner to let them know before it becomes an issue.
They’ll also help to automate and track things like onboarding new employees and staying prepared for inspections, while giving owners a centralized place to make team-wide announcements or contact employees.
Delightree evolved out of a previous company built by its co-founders, Madhulika Mukherjee and Tushar Mishra. They’d been working on Survaider, a tool that monitored customer feedback across social media, review sites, etc., and turned that feedback into actionable to-do lists.
“When we were piloting it, our customers started saying: ‘can we create our own tasks? Or can I tell something to my employees through this?’ ” Mishra told me. “It was just such an obvious problem, so we started building Delightree.”
Delightree co-founders Tushar Mishra and Madhulika Mukherjee
The team has also been working on a feature they call Delightcomply, which helps stores stay up to date on the latest CDC guidelines for businesses operating through the pandemic, and to automatically share compliance details with potential customers. A business could use Delightcomply to publicly outline the steps it’s taking to keep employees/customers safe, for example, with the listing automatically updated to show the status of each task.
Delightree is currently working directly with each new customer to help them through the initial setup — specifically, to help franchisees take the standard operating procedures they receive directly from the brand owners and turn them into Delightree workflows. They’re still working out their exact pricing model, but say that they charge on a per-location-per-month basis, with pricing varying depending on the size/complexity of the business. They’ve set up a waitlist for anyone interested.
This $3 million seed round was funded by Accel Partners, Emergent Ventures, Brainstorm Ventures, Axilor Ventures and Alchemist. As part of the deal, Emergent partner Anupam Rastogi has joined Delightree’s board of directors.
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Another major fintech exit as SoFi acquires banking and payments platform Galileo for $1.2B
The fintech wars continue to heat up with another major exit in the space.
Consumer financial services platform SoFi announced today that it is acquiring payments and bank account infrastructure company Galileo for $1.2 billion in total cash and stock. The acquisition is dependent on customary closing conditions.
Salt Lake City-based Galileo was founded in 2000 by Clay Wilkes and was bootstrapped to profitability over the intervening two decades. My colleague Jon Shieber wrote a profile of Galileo back in November after the company announced its second round of external funding, a $77 million Series A check from Accel, which was led by growth partner John Locke. The company had previously raised an $8 million Series A round from Mercato Partners in April 2014.
Galileo provides APIs that allow fintech companies like Monzo and Chime to easily create bank accounts and issue physical and virtual credit cards, among myriad other services. While simple in theory, banking regulations and financial rules place a huge regulatory burden on fintech companies, burdens that Galileo takes on as part of its platform.
The company has found particular success in the United Kingdom, where all five of the country’s largest fintechs are customers. Globally, it processed an annualized $45 billion in transaction volume last month, up from $26 billion in October 2019 — nearly doubling in just six months.
From a strategic perspective, SoFi’s objective is that Galileo will help power its expanding suite of finance products and offer it another revenue source outside of consumer services. While SoFi was founded a decade ago to offer ways to secure better financial terms for student loans, it now offers a bevy of consumer financial options, including loan, investment and insurance products as well as cash and wealth management tools. With Galileo, it now has a clear B2B revenue component as well.
SoFi, which is now led by ex-Twitter COO Anthony Noto, has also raised hundreds of millions of new capital from the likes of Qatar in recent years. The company was most recently valued at $4.3 billion.
Galileo will operate as an independent division of SoFi, and will be continuing its operations with founder Wilkes remaining as chief executive.
As fintech valuations have rapidly expanded in recent years, the companies that empower those fintechs have increasingly become strategic for investors. Earlier this year, Visa bought Plaid for $5.3 billion, in what was considered a key exit for a finance infrastructure company. That exit brought acute investor and strategic interest to the space, interest that almost certainly accrued to Galileo, as well, and helps explain the company’s relatively quick exit from its funding round last year.
As for Accel, the firm has long had a strategy of investing in mostly bootstrapped companies, sometimes a decade or more after their founding, with examples outside of Galileo including 1Password, Qualtrics, Atlassian, GoFundMe and Tenable. Accel also led this type of round into payments platform Braintree, where the firm met the startup’s GM Juan Benitez, who also joined Galileo’s board in November along with Accel’s Locke.
Accel’s valuation of the deal was not publicly disclosed in November, but a source with knowledge of the acquisition today characterizes the firm’s return as more than 4x. Given that Accel held the equity for roughly half a year, that’s quite the IRR multiple in an otherwise challenging global macro context. Given that the acquisition of Galileo was for cash and stock, Accel likely now holds a stake in SoFi, making at least part of the return unrealized.
Galileo was represented by Qatalyst in the transaction.
Updated April 7 to include the $8 million Series A funding round led by Mercato Partners and more context on IRR.
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Where top VCs are investing in remote events
The novel coronavirus pandemic has rapidly moved companies into a remote-first world.
Nearly all of the world’s largest events have been canceled, put on pause or pivoted to online-only. In the tech world, event cancellations thus far have included SXSW, GDC, Mobile World Congress, Google I/O, Facebook F8, E3 and others.
As more and more hosts consider staging fully remote events as possible alternatives, we decided to take a deeper look into the venture-backed startups focused on supporting large-scale virtual gatherings, like Hopin and Run The World. To further understand the impact of COVID-19, we asked five leading VCs who have invested in or have knowledge of startups focused on remote events to update us on the state of the market and to share where they see opportunity in the sector:
- Sarah Cannon, Index Ventures
- Connie Chan, Andreessen Horowitz
- Andrei Brasoveanu, Accel Partners
- Ryan Kuder, Techstars Anywhere
- Paul Murphy, Northzone
Sarah Cannon, Index Ventures
Which trends in remote events/conferencing excite you the most from an investing perspective?
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VComply raises $2.5 million seed round led by Accel to simplify risk and compliance management
Risk and compliance management platform VComply announced today that it has picked up a $2.5 million seed round led by Accel Partners for its international growth plan. The funding will be used to acquire more customers in the United States, open a new office in the United Kingdom to support customers in Europe and expand its presence in New Zealand and Australia.
The company was founded in 2016 by CEO Harshvardhan Kariwala and has customers in a wide range of industries, including Acreage Holdings, Ace Energy Solutions, CHD, the United Kingdom’s Department of International Trade and Burger King. It currently claims about 4,000 users in more than 100 countries. VComply is meant to be used by all departments in a company, with compliance information organized into a central dashboard.
While there are already a roster of governance, risk and compliance management solutions on the market (including ones from Oracle, HPE, Thomson Reuters, IBM and other established enterprise software companies), VComply’s competitive edge may be its flexibility, simple user interface and easy deployment (the company claims customers can on-board and start using the solution for compliance tasks in about 30 minutes). It also seeks out smaller companies whose needs have not been met by compliance solutions meant for large enterprises.
Kariwala told TechCrunch in an email that he began thinking of creating a new risk and compliance solution while working at his first startup, LIME Learning Systems, an education management platform, after being hit with a $4,000 penalty due to a non-compliance issue.
“Believe me, $4,000 really hurts when you’re bootstrapped and trying to save every single cent you can. In this case, I had asked our outsourced accounting partners to manage this compliance and they forgot!,” he said. After talking to other entrepreneurs, he realized compliance posed a challenge for most of them. LIME’s team built an internal compliance tracking tool for their own use, but also shared it with other people. After getting good feedback, Kariwala realized that despite the many governance, risk and compliance management solutions already on the market, there was still a gap in the market, especially for smaller businesses.
VComply is designed so organizations can customize it for their industry’s regulations and standards, as well as their own workflow and data needs, with competitive pricing for small to medium-sized organizations (a subscription starts at $3,999 a year).
“Most of the traditional GRC solutions that exist today are expensive, have a steep learning curve and entail a prolonged deployment. Not only are they expensive, they are also rigid, which means that organizations have little to no control or flexibility,” Kariwala said. “A GRC tool is often looked at as an expense, while it should really be treated as an investment. It is particularly the SMB sector that suffers the most. With the current solutions costing thousands of dollars (and sometimes millions), it becomes the least of their priorities to invest in a GRC platform, and as a result they fall prey to heightened risks and hefty penalties for non-compliance.”
In a press statement, Accel partner Dinesh Katiyar said, “The first generation of GRC solutions primarily allowed companies to comply with industry-mandated regulations. However, the modern enterprise needs to govern its operations to maintain integrity and trust, and monitor internal and external risks to stay successful. That is where VComply shines, and we’re delighted to be partnering with a company that can redefine the future of enterprise risk management.”
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Atlassian’s co-CEO Scott Farquhar will join us at TC Sessions: Enterprise
Few companies have changed the way developers work as profoundly as Atlassian. Its tools like Jira and Confluence are ubiquitous, and over the course of the last few years, the company has started to adapt many of them for wider enterprise usage outside of developer teams.
To talk about Atlassian’s story from being a small shop in Australia to a successful IPO — and its plans for the future — the company’s co-founder and co-CEO Scott Farquhar will join us at our inaugural TechCrunch Sessions: Enterprise event on September 5 in San Francisco.
Farquhar co-founded Atlassian with Mike Cannon-Brookes, in 2001. It wasn’t until 2010, though, that the company raised its first major venture round ($60 million from Accel Partners). Even by that point, though, the company already had thousands of customers and a growing staff in Sydney and San Francisco.
Today, more than 150,000 companies use Atlassian’s tools. These range from the likes of Audi to Spotify, Twilio and Visa, with plenty of startups and small and medium businesses in between.
It’s no secret that Farquhar and Cannon-Brookes consider themselves accidental billionaires, so it’s maybe no surprise that in 2015, ahead of Atlassian’s successful IPO that valued it at well above $10 billion, he also signed on to the 1% Pledge movement.
Today, Farquhar also makes his own venture investments as part of Skip Capital, which he co-founded.
TC Sessions: Enterprise (September 5 at San Francisco’s Yerba Buena Center) will take on the big challenges and promise facing enterprise companies today. TechCrunch’s editors will bring to the stage founders and leaders from established and emerging companies to address rising questions, like the promised revolution from machine learning and AI, intelligent marketing automation and the inevitability of the cloud, as well as the outer reaches of technology, like quantum computing and blockchain.
Tickets are now available for purchase on our website at the early-bird rate of $395; student tickets are just $245.
We have a limited number of Startup Demo Packages available for $2,000, which includes four tickets to attend the event.
For each ticket purchased for TC Sessions: Enterprise, you will also be registered for a complimentary Expo Only pass to TechCrunch Disrupt SF on October 2-4.
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India’s Bounce raises $72 million to grow its electric scooters business
Bounce, a Bangalore-based startup that offers thousands of electric scooters for rent in India, has raised $72 million to accelerate its bid to impact how people navigate India’s traffic-clogged urban areas.
The Series C funding round for the five-year-old startup was led by B Capital — the VC firm founded by Facebook co-founder Eduardo Saverin — and Falcon Edge Capital. Chiratae Ventures, Maverick Ventures, Omidyar Network India, Qualcomm Ventures and existing investors Sequoia Capital India and Accel Partners India also participated in the round.
This new money means that the startup has raised $92 million to date. The current round valued it at more than $200 million, a person familiar with the matter said.
Bounce, formerly known as Metro Bikes, operates in Bangalore. Its app allows users to pick up a scooter and, when their ride is finished, drop it off at any parking spot. It charges customers based on the time and model of electric scooter they choose. An hour-long ride could cost as little as Rs 15 (21 cents). The startup claims it has already clocked two million rides.
Vivekananda Hallekere, co-founder and CEO of Bounce, told TechCrunch in an interview that the startup plans to use the fresh capital to add more than 50,000 electric scooters to its fleet by the end of the year, up from its current mix of 5,000 electric and gasoline scooters. Additionally, Bounce, which employs about 200 people, plans to enter more cities in India and invest in growing its tech infrastructure and head count.
“We have about 10 metro and non-metro cities in mind. Starting next quarter, we will start to expand in those cities,” he said. The startup also aims to service one million rides in the next year.
Hallekere said Bounce, which currently offers IoT hardware and design for the scooters, is also working on building its own form factor for scooters.
The rise of Bounce comes as it bets that shared two-wheeler vehicles — already a common mode of transportation in the nation — will play an important role in the future of ridesharing, with electric vehicles replacing petrol ones.
This bet has gained more momentum in recent years. Startups such as Yulu, which partnered with Uber earlier this year to conduct a trial in Bangalore; Vogo, which raised money from Uber rival Ola; and Ather Energy have expanded their businesses and gained the backing of major investors.
Their adoption, though still in their nascent stages, is increasingly proving that for millions of people, rides from Uber and Ola are just too expensive for their wallets. Besides, in jam-packed traffic in Bangalore and Delhi and other cities in India, two wheels are more efficient than four.
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Scale, whose army of humans annotate raw data to train self-driving and other AI systems, nabs $18M
The artificial intelligence revolution is underway in the world of technology, but as it turns out, some of the most faithful foot soldiers are still humans. A startup called Scale, which works with a team of contractors who examine and categorise visual data to train AI systems in a two-sided marketplace model, announced that it has raised an additional $18 million in a Series B round. The aim will be to expand Scale’s business to become — in the words of CEO Alexandr Wang, the 21-year-old MIT grad who co-founded Scale with Lucy Guo — “the AWS of AI, with multiple services that help companies build AI algorithms.”
“Our mission is to accelerate the development of AI apps,” Wang said. “The first product is visual data labelling, but in the future we have a broad vision of what we hope to provide.”
Wang declined to comment on the startup’s valuation in an interview. But according to Pitchbook, which notes that this round actually closed in May of this year, the post-money valuation of Scale is now $93.50 million ($75 million pre-money).
The money comes on the back of an eventful two years since the company first launched, with revenues growing 15-fold in the last year, and “multiple millions of dollars in revenue” from individual customers. (It doesn’t disclose specific numbers, however.)
Today, Scale’s base of contractors numbers around 10,000, and it works with a plethora of businesses that are developing autonomous vehicle systems such as General Motors’ Cruise, Lyft Zoox, Nuro, Voyage, nuTonomy and Embark. These companies send Scale’s contractors raw, unlabelled data sets by way of Scale’s API, which provides services like Semantic Segmentation, Image Annotation, and Sensor Fusion, in conjunction with its clients LIDAR and RADAR data sets. In total, it says it’s annotated 200,000 “miles of data” collected by self-driving cars.
AV companies are not its only customers, though. Scale also works with several non-automotive companies like Airbnb and Pinterest, to help build their AI-based visual search and recommendation systems. Airbnb, for example, is looking for more ways of being able to ascertain what kinds of homes repeat customers like and don’t like, and also to start to provide other ways of discovering places to stay that are based not just on location and number of bedrooms (which becomes more important especially in cities where you may have too many choices and want a selection more focused on what you are more likely to rent).
This latest funding round was led by Index, with existing investors Accel and Y Combinator (where Scale was incubated), also participated in this Series B, along with some notable, new individual investors such as Dropbox CEO Drew Houston and Justin Kan (two YC alums themselves who have been regular investors in other YC companies). This latest round brings the total raised by Scale to $22.7 million.
When Scale first made its debut in July 2016 as part of YC’s summer cohort, the company presented itself as a more intelligent alternative to Mechanical Turk, specifically to address the demands of artificial intelligence systems that needed more interaction and nuanced responses than the typical microtask asked of a Turker.
“We’re honing in on AI broadly,” Wang said. “Our goal is to be a pick axe in the AI goldrush.”
Early efforts covered a wide spread of applications — categorization/content moderation, comparison, transcription, and phone calling as some examples. But more recently the company has seen a particular interest from self-driving car companies, and specifically the ability to look at, understand and categorise images of what might appear on a road with the kind of recognition that only a human can provide for training purposes. For example, to be able to identify a scooter versus a wagon, a piece of asphalt or an article of granite-colored clothing on a person that could potentially look like asphalt to an unsuspecting camera, or whatever.
“This sub-segment of AI, autonomous vehicles, really took off after we launched, and that segment has been the killer use case for us,” Wang said.
My experience in talking with autonomous car companies and those who work with them has been that many of them are extremely guarded about their data, so much so that there are entire companies being built to help manage this IP standoff so that no one has to share what they know, but they can still benefit from each other.
Wang says that the same holds for Scale’s clients, and part of its unique selling point is that it not only provides data identification services but does so with the assurance that its systems retain none of that data for its own or other companies’ purposes.
“We don’t share across different silos and are very clear about that,” Wang said. “These companies are very sensitive, as are all AI companies about their data and where it goes, and we’ve been able to gain trust as a partner because will not share or sell data to any other parties.”
Scale uses AI itself to help select contractors. “We have built a bunch of algorithms and AI to vet and train contractors,” Wang said. In the training, “we provide feedback and determine if they are getting good enough to do the work, and in terms of ensuring the quality of their work, our algorithms go through what they are doing and verify the work against our models, too. There are a lot of algorithms.”
For clients who are calling in data from the public web — for example Pinterest or Airbnb — Scale uses a broader contractor pool that could include stay-at-home moms, students or others looking for extra money.
For clients who are sensitive about the data that’s being analysed — such as the car companies — the conditions are more restricted, and sometimes include centres where Scale controls the machines that are being used as well as how the data sets can be viewed.
This is one reason why Scale isn’t simply focused on growing the numbers of contractors as its only route for growing business. “We’ve noticed that when you have people who spend more time on this they do better work,” Wang said.
Wang said the Series B funding will be used to expand the kind of work Scale does for existing customers in the area of visual data analysis, as well as to gradually add in other categories of data, such as text.
“Our first goal is to improve algorithms for customers today,” he said. “There is no limit to how accurate they want to make their systems, and they need to be constantly feeding their AI with more data. All of our customers have this, and it’s an evergreen problem.”
The second is to diversify more outside driving and the visual data set, he said. “Right now, so much of the success has been in processing imagery and robotics or other perception challenges, but we really want to be the fabric of the AI world for new applications, including text or audio. That is another use of funds to expand to those areas.”
“Fabric” is the operative word, it seems: “Scale has the potential to become the fabric that connects and powers the Artificial Intelligence world,” said Mike Volpi, General Partner, Index Ventures, in a statement. “For autonomous vehicles in particular, Scale is well-positioned to take over an emerging field of data annotation regardless of which players ultimately come out on top. Alex…has recruited a highly talented and technical team to tackle this challenge and their progress is evident in the marquee list of customers they’ve won in such a short amount of time.”
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RiskRecon’s security assessment services for third-party vendors raises $25 million
In June of this year, Chinese hackers managed to install software into the networks of a contractor for the U.S. Navy and steal information on a roughly $300 million top-secret submarine program.
Two years ago, hackers infiltrated the networks of a vendor servicing the Australian military and made off with files containing a trove of information on Australian and U.S. military hardware and plans. That hacker stole roughly 30 gigabytes of data, including information on the nearly half-a-trillion dollar F-35 Joint Strike Fighter program.
Third-party vendors, contractors and suppliers to big companies have long been the targets for cyber thieves looking for access to sensitive data, and the reason is simple. Companies don’t know how secure their suppliers really are and can’t take the time to find out.
“The Department of Defense can have the best cybersecurity on the planet, but when that moves off to a subcontractor how can the DOD know how the subcontractor is going to protect that data?” says Kelly White, the chief executive of RiskRecon, a new firm that provides audits of vendors’ security profile.
The problem is one that the Salt Lake City-based executive knew well. White was a former security executive for Zion Bank Corporation after spending years in the cybersecurity industry with Ernst & Young and TrueSecure — a Washington, DC-based security vendor.
When White began work with Zion, around 2 percent of the company’s services were hosted by third parties; less than five years later and that number had climbed to over 50 percent. When White identified the problem in 2010, he immediately began developing a solution on his own time. RiskRecon’s chief executive estimates he spent 3,000 hours developing the service between 2010 and 2015, when he finally launched the business with seed capital from General Catalyst .
And White says the tools that companies use to ensure that those vendors have adequate security measures in place basically boiled down to an emailed checklist that the vendors would fill out themselves.
That’s why White built the RiskRecon service, which has just raised $25 million in a new round of funding led by Accel Partners with participation from Dell Technologies Capital, General Catalyst and F-Prime Capital, Fidelity Investments’ venture capital affiliate.
The company’s software looks at what White calls the “internet surface” of a vendor and maps the different ways in which that surface can be compromised. “We don’t require any insider information to get started,” says White. “The point of finding systems is to understand how well an organization is managing their risk.”
White says that the software does more than identify the weak points in a vendor’s security profile, it also tries to get a view into the type of information that could be exposed at different points on a network.
According to White, the company has more than 50 customers among the Fortune 500 that are already using his company’s services across industries like financial services, oil and gas and manufacturing.
The money from RiskRecon’s new round will be used to boost sales and marketing efforts as the company looks to expand into Europe, Asia and further into North America.
“Where there’s not transparency there’s often poor performance,” says White. “Cybersecurity has gone a long time without true transparency. You can’t have strong accountability without strong transparency.”
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The Accel team is coming to Disrupt Berlin
Every time Accel invests in a startup, it’s an instant positive sign in the startup community. The venture capital firm has a rich history with decades of investments in successful startups. That’s why we’re excited to have four partners at Accel on stage at Disrupt Berlin.
Philippe Botteri, Sonali De Rycker, Luciana Lixandru and Harry Nelis will all relocate their partner meeting to our stage.
Accel is a different VC firm for many reasons. First, while the firm started in Silicon Valley, the team bet early on the European startup scene, back in 2001. With an office in London, the team keeps an eye on the entire continent for investment opportunities.
The firm has invested in Deliveroo, BlaBlaCar, Supercell, Spotify and so many others. With such a good track record, it’s clear that some recent investments are also going to become massive companies — nobody has realized it just yet.
In November, we will have four Accel partners on stage to discuss the firm’s investment thesis, each partner’s current obsessions and their collective thoughts on the startup scene in Europe.
It’s going to be a great way to hear the granularity of a team with strong beliefs. I’m sure they don’t always agree on everything, but somehow they manage to invest together as a firm.
TechCrunch is coming back to Berlin to talk with the best and brightest people in tech from Europe and the rest of the world. In addition to fireside chats and panels, new startups will participate in the Startup Battlefield Europe to win the coveted cup.
Grab your ticket to Disrupt Berlin before August 1st as prices will increase after that. The conference will take place on November 29-30.
Philippe Botteri, Partner, Accel
Philippe Botteri focuses on SaaS, enterprise and marketplace businesses.
Philippe led Accel’s investments in DocuSign (IPO), PeopleDoc, Qubit, Algolia, BlaBlaCar, Doctolib and Zenaton. He also works closely with the team at Fiverr and CrowdStrike. Prior to joining Accel, Philippe was with Bessemer, where he worked with the firm’s SaaS and Ad Tech investments including Cornerstone OnDemand (public), Eloqua (public) and Criteo (public).
Philippe is from Paris and graduated from Ecole Polytechnique, where he is a member of the Entrepreneurship Advisory Board, and Ecole des Mines.
Sonali De Rycker, Partner, Accel
Sonali De Rycker focuses on consumer, software and financial services businesses.
She led Accel’s investments in Avito (acquired by Naspers), Lyst, Spotify (IPO), Wallapop, KupiVIP, Calastone, Catawiki, JobToday, Shift Technology, SilverRail (acquired by Expedia), Kry and Soldo. Prior to Accel, Sonali was with Atlas Ventures.
Sonali grew up in Mumbai and graduated from Bryn Mawr College and Harvard Business School.
Luciana Lixandru, Partner, Accel
Luciana Lixandru focuses on consumer internet, software and marketplace businesses.
She helped lead Accel’s investments and ongoing work in UiPath, Deliveroo, Framer, Avito, Catawiki, Vinted and others. She is also an independent director of Showroomprive (public). Prior to Accel, Luciana was with Summit Partners.
Luciana is from Romania and graduated from Georgetown University.
Harry Nelis, Partner, Accel
Harry Nelis focuses on consumer internet, financial services and software companies.
He led Accel’s investments in CHECK24, Funding Circle, KAYAK (IPO; acquired by Priceline), Showroomprive (IPO), WorldRemit, Celonis, Callsign, Instana and others.
Harry started his career as an engineer at Hewlett-Packard before founding the venture-backed software company E-motion.
Harry is from the Netherlands and graduated from Delft University of Technology and Harvard Business School.
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