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NotCo gets its horn following $235M round to expand plant-based food products
NotCo, a food technology company making plant-based milk and meat replacements, wrapped up another funding round this year, a $235 million Series D round that gives it a $1.5 billion valuation.
Tiger Global led the round and was joined by new investors, including DFJ Growth Fund, the social impact foundation, ZOMA Lab; athletes Lewis Hamilton and Roger Federer; and musician and DJ Questlove. Follow-on investors included Bezos Expeditions, Enlightened Hospitality Investments, Future Positive, L Catterton, Kaszek Ventures, SOSV and Endeavour Catalyst.
This funding round follows an undisclosed investment in June from Shake Shack founder Danny Meyer through his firm EHI. In total, NotCo, with roots in both Chile and New York, has raised more than $350 million, founder and CEO Matias Muchnick told TechCrunch.
Currently, the company has four product lines: NotMilk, NotBurger and NotMeat, NoticeCream and NotMayo, which are available in the five countries of the U.S., Brazil, Argentina, Chile and Colombia.
The company is operating in the middle of a trend toward eating healthier food, as more consumers also question how their food is made, resulting in demand for alternative proteins. In fact, the market for alternative meat, eggs, dairy and seafood products is predicted to reach $290 billion by 2035, according to research by Boston Consulting Group and Blue Horizon Corp.
NotCo’s proprietary artificial intelligence technology, Giuseppe, matches animal proteins to their ideal replacements among thousands of plant-based ingredients. It is working to crack the code in understanding the molecular components and food characteristics in the combination of two ingredients that could mimic milk, but in a more sustainable and resourceful way — and that also tastes good, which is the biggest barrier to adoption, Muchnick said.
“Our theory is that there is a crazy dynamic among people: 60% who are already eating plant-based are not happy with the taste, and 30% of those who drink cow’s milk are waiting to change if there is a similar taste,” he added. “Our technology is based in AI so that we can create a different food system, as well as products faster and better than others in the space. There are 300,000 plant species, and we still have no idea what 99% of them can do.”
In addition to a flow of investments this year, the company launched its NotMilk brand in the United States seven months ago and is on track to be in 8,000 locations across retailers like Whole Foods Market, Sprouts and Wegmans by the end of 2021.
Muchnick plans to allocate some of the new funding to establish markets in Mexico and Canada and add market share in the U.S. and Chile. He expects to have 50% of its business coming from the U.S. over the next three years. He is also eyeing an expansion into Asia and Europe in the next year.
NotCo also intends to add more products, like chicken and other white meats and seafood, and to invest in technology and R&D. He expects to do that by doubling the company’s current headcount of 100 in the next two years. Muchnick also wants to establish more patents in food science — the company already has five — and to explore a potential intelligence side of the business.
Though NotCo reached unicorn status, Muchnick said the real prize is the brand awareness and subsequent sales boost, as well as opening doors for quick-service restaurant deals. NotBurger went into Burger King restaurants in Chile 11 months ago, and now has 5% of the market there, he added.
Sales overall have grown three times annually over the past four years, something Muchnick said was attractive to Tiger Global. He is equally happy to work with Tiger, especially as the company prepares to go public in the next two or three years. He said Tiger’s expertise will get NotCo there in a more prepared manner.
“NotCo has created world class plant-based food products that are rapidly gaining market share,” said Scott Shleifer, partner at Tiger Global, in a written statement. “We are excited to partner with Matias and his team. We expect continued product innovation and expansion into new geographies and food categories will fuel high and sustainable growth for years to come.”
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Extra Crunch roundup: Finding GTM, China’s edtech clampdown and how to define growth
Early-stage startups tend to claim that their go-to-market strategy is fully operational. In reality, GTM is a stark numbers game, and even with a solid plan in place, it can be easily foiled by common problems like turf battles and poor communication.
Finding GTM fit is a milestone for any startup that includes everything from expanding the engineering team to launching your first media buy. But how do you know when you’ve reached that magic moment?
“You have to consider three metrics: gross churn rate, the magic number and gross margin,” says Tae Hea Nahm, co-founder and managing director of Storm Ventures.
High churn means customers aren’t delighted, low gross margins mean poor unit economics, and that so-called magic number?
“You can calculate it by taking new ARR divided by your marketing and sales spending,” Nahm writes. “But keep in mind that the magic number is a lagging indicator, and it may take you a few quarters to see a positive result.”
Full Extra Crunch articles are only available to members.
Use discount code ECFriday to save 20% off a one- or two-year subscription.
If you are methodical in your approach to building a larger customer base, it is not difficult to foster steady growth.
Marketers who shift with whichever way the wind is blowing — or blindly follow someone else’s idea of best practices — are less likely to be successful.
“The not-so-secret secret here is that the key to great retention is really simple,” said growth expert Susan Su recently at TechCrunch Early Stage: Marketing and Fundraising. “It is building a product that solves a real and especially persistent problem for people.”
In conversation with Managing Editor Eric Eldon, Su delved into several issues, including tips on how founders should discuss growth with investors, and her methods for developing a sample qualitative growth model.
“I firmly believe that every founder should try their hand at growth,” said Su.
Thanks very much for reading Extra Crunch this week!
Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist
How we built an AI unicorn in 6 years
Image Credits: Lucas Knappe/EyeEm (opens in a new window)/ Getty Images
Few startups go to market with the exact product their founders first envisioned.
Today, Tractable is known for developing tech that allows drivers to upload photos of their vehicles after a collision so its AI can assess the damage. Its first paying customer, however, used Tractable to inspect plastic pipe welds.
And as fate would have it, that customer also fired them just as the founders were raising their first round.
“We struck gold with car insurance,” says co-founder Alex Dalyac, as it was “a huge and inefficient market in desperate need of modernization.”
In an Extra Crunch guest post, he shares several takeaways from the last six years spent scaling a unicorn that have value for founders of all stripes. Step one?
“Search for complementary co-founders who will become your best friends,” advises Dalyac.
The European VC market is so hot it may skip its summer holiday
Image Credits: Nigel Sussman (opens in a new window)
Alex Wilhelm and Anna Heim continued their exploration of the scorching global VC market, this time taking a look at Europe.
For perspective, they analyzed data from Dealroom and spoke to four VCs about the continent’s investment climate:
- Diana Koziarska, SMOK Ventures
- Vinoth Jayakumar, Draper Esprit
- Simon Schmincke, Creandum
- Javier Santiso, Mundi Ventures
“There’s little indication that what we’ve seen thus far from Europe in 2021 will slow in Q3 or Q4,” Alex and Anna write.
“Even though Europe has a reputation for lengthy summer vacations, investors don’t expect much — if any — slowdown to come in Europe during this sun-drenched quarter.”
Startups and investors are turning to micromobility subscriptions
Image Credits: Bryce Durbin
“Amid the chaos of the COVID-19 pandemic and the murky path to profitability for shared electric micromobility, an increasing number of companies have turned to subscriptions,” Rebecca Bellan writes in a roundup about the future of micromobility.
“It’s a business model that some founders and investors argue hits the profit center sweet spot — an approach that appeals to customers who are wary of sharing as well as paying upfront to own a scooter or e-bike, all while minimizing overhead costs and depreciation of assets.”
What Robinhood’s warnings about crypto trading say about Coinbase’s near-term future
Image Credits: Nigel Sussman (opens in a new window)
After noting that Robinhood anticipates a decline in revenue in the third quarter as a result of slowing crypto trading, Alex Wilhelm got to thinking about what that forecast means for Coinbase.
“The now-public unicorn has lived through crypto ups and crypto downs,” he writes. “A decline in consumer interest in the next few months or quarters is not a huge deal, assuming one keeps a long enough perspective and the crypto-infused future that its fans expect comes to pass.”
But will it?
Dear Sophie: Should we look to Canada to retain international talent?
Image Credits: Bryce Durbin/TechCrunch
Dear Sophie,
I handle people ops as a consultant at several different tech startups. Many have employees on OPT or STEM OPT who didn’t get selected in this year’s H-1B lottery.
The companies want to retain these individuals, but they’re running out of options. Some companies will try again in next year’s H-1B lottery, even though they face long odds, particularly if the H-1B lottery becomes a wage-based selection process next year.
Others are looking into O-1A visas, but find that many employees don’t yet have the experience to meet the qualifications. Should we look at Canada?
— Specialist in Silicon Valley
Silicon Valley comms expert Caryn Marooney shares how to nail the narrative
Image Credits: MediaNews Group/Bay Area News via Getty Images (opens in a new window)/ Getty Images (Image has been modified)
Caryn Marooney, a Silicon Valley communications professional turned venture capitalist, spoke extensively on storytelling at TechCrunch Early Stage: Marketing and Fundraising.
Throughout her time in Silicon Valley, she helped companies like Salesforce, Amazon, Facebook and more launch products and sharpen their messaging. In 2019, she left Facebook, where she was VP of technology communication, and joined Coatue Management as a general partner.
Marooney uses the acronym RIBS to describe her basic strategy for startup messaging: Relevance, Inevitability, Believability and keeping it Simple.
Canada’s startup market booms alongside hot global VC investment
Image Credits: Nigel Sussman (opens in a new window)
For The Exchange, Alex Wilhelm and Anna Heim looked at Canada’s VC market in the first half of 2021, and if you’ve been reading their work, you know what’s coming.
Canada, like the rest of the globe, was absolutely scorching in the first half.
“Canada’s venture capital results now rival those of the entire Latin American region, with exits and mega-deals coming in roughly on par in the second quarter, and a similar number of total venture capital rounds in the period,” they write.
“That caught our attention.”
Greylock’s Mike Duboe explains how to define growth and build your team
With more venture funding flowing into the startup ecosystem than ever before, there’s never been a better time to be a growth expert.
At TechCrunch Early Stage: Marketing and Fundraising earlier this month, Greylock Partners’ Mike Duboe dug into a number of lessons and pieces of wisdom he’s picked up leading growth at a number of high-growth startups, including StitchFix. His advice spanned hiring, structure and analysis, with plenty of recommendations for where growth teams should be focusing their attention and resources.
Last-mile delivery in Latin America is ready to take off
Image Credits: Erlon Silva/TRI Digital (opens in a new window) / Getty Images
Thanks to sprawling fulfillment centers, seamless logistics networks and ubiquitous internet access, consumers in many regions can now order groceries and a new set of cookware during breakfast and reasonably expect everything to arrive in time for dinner.
In Latin America, a lack of technology infrastructure makes delivery operations complex, and these supply chains are often managed with spreadsheets, paper and pen.
Algorithms that manage delivery routes or automatically dispatch drivers “are almost unheard of in the Latin America retail logistics sector,” says Bob Ma, an investor at WIND Ventures.
But thanks to growing consumer demand and expanding investment in last-mile delivery startups, Ma says the region is at a turning point.
Since Latin America’s middle class has grown 50% in the last decade and e-commerce constitutes just 6% of all retail, several unicorns have emerged in recent years, with more waiting in the wings.
China’s expected edtech clampdown may chill a key startup sector
Image Credits: Nigel Sussman (opens in a new window)
China’s edtech industry is estimated to be worth $100 billion, but its leaders are reportedly considering a plan that would require these firms to operate as non-profits.
“When it comes to control, the Chinese government doesn’t mind wiping out a few dozen billion dollars in market cap here and there,” writes Alex Wilhelm in this morning’s edition of The Exchange.
“That’s not a great system.”
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VOCHI raises additional $2.4 million for its computer vision-powered video editing app
VOCHI, a Belarus-based startup behind a clever computer vision-based video editing app used by online creators, has raised an additional $2.4 million in a “late-seed” round that follows the company’s initial $1.5 million round led by Ukraine-based Genesis Investments last year. The new funds follow a period of significant growth for the mobile tool, which is now used by more than 500,000 people per month and has achieved a $4 million-plus annual run rate in a year’s time.
Investors in the most recent round include TA Ventures, Angelsdeck, A.Partners, Startup Wise Guys, Kolos VC and angels from companies like Belarus-based Verv and Estonian unicorn Bolt. Along with the fundraise, VOCHI is elevating the company’s first employee, Anna Buglakova, who began as head of marketing, to the position of co-founder and chief product officer.
According to VOCHI co-founder and CEO Ilya Lesun, the company’s idea was to provide an easy way for people to create professional edits that could help them produce unique and trendy content for social media that could help them stand out and become more popular. To do so, VOCHI leverages a proprietary computer vision-based video segmentation algorithm that applies various effects to specific moving objects in a video or to images in static photos.
“To get this result, there are two trained [convolutional neural networks] to perform semi-supervised Video Object Segmentation and Instance Segmentation,” explains Lesun, of VOCHI’s technology. “Our team also developed a custom rendering engine for video effects that enables instant application in 4K on mobile devices. And it works perfectly without quality loss,” he adds. It works pretty fast, too — effects are applied in just seconds.
The company used the initial seed funding to invest in marketing and product development, growing its catalog to over 80 unique effects and more than 30 filters.
Image Credits: VOCHI
Today, the app offers a number of tools that let you give a video a particular aesthetic (like a dreamy vibe, artistic feel, or 8-bit look, for example). It also can highlight the moving content with glowing lines, add blurs or motion, apply different filters, insert 3D objects into the video, add glitter or sparkles and much more.
In addition to editing their content directly, users can swipe through a vertical home feed in the app where they can view the video edits others have applied to their own content for inspiration. When they see something they like, they can then tap a button to use the same effect on their own video. The finished results can then be shared out to other platforms, like Instagram, Snapchat and TikTok.
Though based in Belarus, most of VOCHI’s users are young adults from the U.S. Others hail from Russia, Saudi Arabia, Brazil and parts of Europe, Lesun says.
Unlike some of its video editor rivals, VOCHI offers a robust free experience where around 60% of the effects and filters are available without having to pay, along with other basic editing tools and content. More advanced features, like effect settings, unique presents and various special effects, require a subscription. This subscription, however, isn’t cheap — it’s either $7.99 per week or $39.99 for 12 weeks. This seemingly aims the subscription more at professional content creators rather than a casual user just looking to have fun with their videos from time to time. (A one-time purchase of $150 is also available, if you prefer.)
To date, around 20,000 of VOCHI’s 500,000 monthly active users have committed to a paid subscription, and that number is growing at a rate of 20% month-over-month, the company says.
Image Credits: VOCHI
The numbers VOCHI has delivered, however, aren’t as important as what the startup has been through to get there.
The company has been growing its business at a time when a dictatorial regime has been cracking down on opposition, leading to arrests and violence in the country. Last year, employees from U.S.-headquartered enterprise startup PandaDoc were arrested in Minsk by the Belarus police, in an act of state-led retaliation for their protests against President Alexander Lukashenko. In April, Imaguru, the country’s main startup hub, event and co-working space in Minsk — and birthplace of a number of startups, including MSQRD, which was acquired by Facebook — was also shut down by the Lukashenko regime.
Meanwhile, VOCHI was being featured as App of the Day in the App Store across 126 countries worldwide, and growing revenues to around $300,000 per month.
“Personal videos take an increasingly important place in our lives and for many has become a method of self-expression. VOCHI helps to follow the path of inspiration, education and provides tools for creativity through video,” said Andrei Avsievich, general partner at Bulba Ventures, where VOCHI was incubated. “I am happy that users and investors love VOCHI, which is reflected both in the revenue and the oversubscribed round.”
The additional funds will put VOCHI on the path to a Series A as it continues to work to attract more creators, improve user engagement and add more tools to the app, says Lesun.
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Tailor Brands raises $50M, aims to be one-stop shop for small businesses to launch
Tailor Brands, a startup that automates parts of the branding and marketing process for small businesses, announced Thursday it has raised $50 million in Series C funding.
GoDaddy led the round as a strategic partner and was joined by OurCrowd and existing investors Pitango Growth, Mangrove Capital Partners, Armat Group, Disruptive VC and Whip Media founder Richard Rosenblatt. Tailor Brands has now raised a total of $70 million since its inception in 2015.
“GoDaddy is empowering everyday entrepreneurs around the world by providing all of the help and tools to succeed online,” said Andrew Morbitzer, vice president of corporate development at GoDaddy, in a written statement. “We are excited to invest in Tailor Brands — and its team — as we believe in their vision. Their platform truly helps entrepreneurs start their business quickly and easily with AI-powered logo design and branding services.”
When Tailor Brands, which launched at TechCrunch’s Startup Battlefield in 2014, raised its last round, a $15.5 million Series B, in 2018, the company was focused on AI-driven logo creation.
The company, headquartered in New York and Tel Aviv, is now compiling the components for a one-stop SaaS platform — providing the design, branding and marketing services a small business owner needs to launch and scale operations, and within minutes, Yali Saar, co-founder and CEO of Tailor Brands told TechCrunch.
Over the past year, more users are flocking to Tailor Brands; the company is onboarding some 700,000 new users per month for help in the earliest stages of setting up their business. In fact, the company saw a 27% increase in new business incorporations as the creator and gig economy gained traction in 2020, Saar said.
In addition to the scores of new users, the company crossed 30 million businesses using the platform. At the end of 2019, Tailor Brands started monetizing its offerings and “grew at a staggering rate,” Saar added. The company yielded triple-digit annual growth in revenue.
To support that growth, the new funding will be used on R&D, to double the team and create additional capabilities and functions. There may also be future acquisition opportunities on the table.
Saar said Tailor Brands is at a point where it can begin leveraging the massive amount of data on small businesses it gathers to help them be proactive rather than reactive, turning the platform into a “consultant of sorts” to guide customers through the next steps of their businesses.
“Users are looking for us to provide them with everything, so we are starting to incorporate more products with the goal of creating an ecosystem, like WeChat, where you don’t need to leave the platform at all to manage your business,” Saar said.
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How we built an AI unicorn in 6 years
Today, Tractable is worth $1 billion. Our AI is used by millions of people across the world to recover faster from road accidents, and it also helps recycle as many cars as Tesla puts on the road.
And yet six years ago, Tractable was just me and Raz (Razvan Ranca, CTO), two college grads coding in a basement. Here’s how we did it, and what we learned along the way.
Build upon a fresh technological breakthrough
In 2013, I was fortunate to get into artificial intelligence (more specifically, deep learning) six months before it blew up internationally. It started when I took a course on Coursera called “Machine learning with neural networks” by Geoffrey Hinton. It was like being love struck. Back then, to me AI was science fiction, like “The Terminator.”
Narrowly focusing on a branch of applied science that was undergoing a paradigm shift which hadn’t yet reached the business world changed everything.
But an article in the tech press said the academic field was amid a resurgence. As a result of 100x larger training data sets and 100x higher compute power becoming available by reprogramming GPUs (graphics cards), a huge leap in predictive performance had been attained in image classification a year earlier. This meant computers were starting to be able to understand what’s in an image — like humans do.
The next step was getting this technology into the real world. While at university — Imperial College London — teaming up with much more skilled people, we built a plant recognition app with deep learning. We walked our professor through Hyde Park, watching him take photos of flowers with the app and laughing from joy as the AI recognized the right plant species. This had previously been impossible.
I started spending every spare moment on image classification with deep learning. Still, no one was talking about it in the news — even Imperial’s computer vision lab wasn’t yet on it! I felt like I was in on a revolutionary secret.
Looking back, narrowly focusing on a branch of applied science undergoing a breakthrough paradigm shift that hadn’t yet reached the business world changed everything.
Search for complementary co-founders who will become your best friends
I’d previously been rejected from Entrepreneur First (EF), one of the world’s best incubators, for not knowing anything about tech. Having changed that, I applied again.
The last interview was a hackathon, where I met Raz. He was doing machine learning research at Cambridge, had topped EF’s technical test, and published papers on reconstructing shredded documents and on poker bots that could detect bluffs. His bare-bones webpage read: “I seek data-driven solutions to currently intractable problems.” Now that had a ring to it (and where we’d get the name for Tractable).
That hackathon, we coded all night. The morning after, he and I knew something special was happening between us. We moved in together and would spend years side by side, 24/7, from waking up to Pantera in the morning to coding marathons at night.
But we also wouldn’t have got where we are without Adrien (Cohen, president), who joined as our third co-founder right after our seed round. Adrien had previously co-founded Lazada, an online supermarket in South East Asia like Amazon and Alibaba, which sold to Alibaba for $1.5 billion. Adrien would teach us how to build a business, inspire trust and hire world-class talent.
Find potential customers early so you can work out market fit
Tractable started at EF with a head start — a paying customer. Our first use case was … plastic pipe welds.
It was as glamorous as it sounds. Pipes that carry water and natural gas to your home are made of plastic. They’re connected by welds (melt the two plastic ends, connect them, let them cool down and solidify again as one). Image classification AI could visually check people’s weld setups to ensure good quality. Most of all, it was real-world value for breakthrough AI.
And yet in the end, they — our only paying customer — stopped working with us, just as we were raising our first round of funding. That was rough. Luckily, the number of pipe weld inspections was too small a market to interest investors, so we explored other use cases — utilities, geology, dermatology and medical imaging.
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Visualping raises $6M to make its website change monitoring service smarter
Visualping, a service that can help you monitor websites for changes like price drops or other updates, announced that it has raised a $6 million extension to the $2 million seed round it announced earlier this year. The round was led by Seattle-based FUSE, a relatively new firm with investors who spun out of Ignition Partners last year. Prior investors Mistral Venture Partners and N49P also participated.
The Vancouver-based company is part of the current Google for Startups Accelerator class in Canada. This program focuses on services that leverage AI and machine learning, and, while website monitoring may not seem like an obvious area where machine learning can add a lot of value, if you’ve ever used one of these services, you know that they can often unleash a plethora of false alerts. For the most part, after all, these tools simply look for something in a website’s underlying code to change and then trigger an alert based on that (and maybe some other parameters you’ve set).
Image Credits: Visualping
Earlier this week, Visualping launched its first machine learning-based tools to avoid just that. The company argues that it can eliminate up to 80% of false alerts by combining feedback from its more than 1.5 million users with its new ML algorithms. Thanks to this, Visualping can now learn the best configuration for how to monitor a site when users set up a new alert.
“Visualping has the hearts of over a million people across the world, as well as the vast majority of the Fortune 500. To be a part of their journey and to lead this round of financing is a dream,” FUSE’s Brendan Wales said.
Visualping founder and CEO Serge Salager tells me that the company plans to use the new funding to focus on building out its product but also to build a commercial team. So far, he said, the company’s growth has been primarily product led.
As a part of these efforts, the company also plans to launch Visualping Business, with support for these new ML tools and additional collaboration features, and Visualping Personal for individual users who want to monitor things like ticket availability for concerts or to track news, price drops or job postings, for example. For now, the personal plan will not include support for ML. “False alerts are not a huge problem for personal use as people are checking two-three websites but a huge problem for enterprise where teams need to process hundreds of alerts per day,” Salager told me.
The current idea is to launch these new plans in November, together with mobile apps for iOS and Android. The company will also relaunch its extensions around this time, too.
It’s also worth noting that while Visualping monetizes its web-based service, you can still use the extension in the browser for free.
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Taste intelligence startup Halla closes $4.5M Series A1 to predict which grocery items shoppers will buy
Halla wants to answer the question of how people decide what to eat, and now has $4.5 million in fresh Series A1 capital from Food Retail Ventures to do it.
Headquartered in New York, Halla was founded in 2016 by Gabriel Nipote, Henry Michaelson and Spencer Price to develop “taste intelligence,” using human behavior to steer shoppers to food items they want while also discovering new ones as they shop online. This all results in bigger basket orders for stores. SOSV and E&A Venture Capital joined in on the round, which brings Halla’s total capital raised to $8.5 million, CEO Price told TechCrunch.
The company’s API technology is a plug-and-play platform that leverages more than 100 billion shopper and product data points and funnels it into three engines: Search, which takes into account a shopper’s preferences; Recommend, which reveals relevant complementary products as someone shops; and Substitute, which identifies replacement options.
Halla’s Substitute product was released earlier this year as an answer to better recommendations for out-of-stock items that even retailers like Walmart are creating technology to solve. Price cited a McKinsey report that found 20% of grocery shoppers sought out competitors following a negative outcome from bad substitutions.
Halla Substitute. Image Credits: Halla
None of these data points are linked to any shoppers’ private data, just the attributes around the shopping itself. The APIs, rather, are looking for context to return relevant recommendations and substitutions. For example, Halla’s platform would take into account the way someone adds items to their cart and suggest next ones: if you added turkey and then bread, the platform may suggest cheese and condiments.
“It’s also about personalization when it comes to grocery shopping and food,” Price said. “When you want organic eggs from a specific brand and it is out of stock, it is often up to your personal shopper’s discretion. We want to lead them to the right substitutions, so you can still cook the meal you intended instead of ‘close enough.’ ”
Halla’s technology is now live in more than 1,100 e-commerce storefronts. The new funding gives Halla some fuel for the fire Price said is happening within the company, including plans to double the number of stores it supports across accounts. He also expects to double employees to 30 in order to support growth and customer base, admitting there is “more inbound interest that we can handle.” Halla has been busy fast-tracking big customers for pilots, and at the same time, wants to expand internationally with additional product lines over the next 18 months.
The company is also seeing “a near infinite increase in recurring revenue,” as it attracts six- and seven-figure contracts that push the company closer to cash flow positivity. All of that growth is positioning Halla for a Series B if it needs it, Price said.
Meanwhile, as part of the investment, Food Retail Ventures’ James McCann will join Halla’s board of directors.
McCann, who only invests in food and retail technology, told TechCrunch that grocery stores need a way to inspire shoppers, that Halla is doing that and in a better way than other intelligence versions he has seen.
“Their technology is miles ahead of everyone else,” he added. “They have a terrific team and a terrific product. They are seeing huge uplifts in terms of suggestions and what people are buying, and their measurements are out of this world.”
Photo includes Halla co-founders, from left, Spencer Price (CEO), Henry Michaelson (CTO & President) and Gabriel Nipote (COO).
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Simpplr raises $32M for its intranet platform
Simpplr, a modern platform for building intranet sites (or “employee communications and enablement platforms,” as the company calls it), today announced that it has raised a $32 million Series C round led by Tola Capital. Norwest Ventures, which led the company’s Series B round last year, as well as Salesforce Ventures and George Still Ventures also participated. This brings Simpplr’s total funding to just over $61 million.
As Simpplr CEO and founder Dhiraj Sharma told me, the Series B round was meant to help the team accelerate product innovation and development. Unsurprisingly, the COVID-19 pandemic only increased demand for digital workplace solutions like Simpplr. As Sharma noted, the company’s thesis was always that the world was moving toward remote/hybrid work. The pandemic only accelerated this process and with that, the sense of urgency in its customer base to modernize their own platforms for communicating with their employees. To keep up with this growth, the company doubled its team since last August (though Sharma, just like many other startup founders I’ve recently talked to, also bemoaned that it’s becoming increasingly hard to find talent).
The company says that it added 100 enterprise customers over the course of the last year. Today, its customer base includes a number of early adopters like Splunk or Nutanix, which were always building toward a global workforce and always had a need for a product like Simpplr. But due to the pandemic, more traditional businesses like Fox, AAA insurance or Renewal by Andersen also needed to quickly find ways to support their newly remote workforces.
“When this pandemic happened, there were lots of traditional companies who didn’t think that they would be doing remote work as much in the near future as they had to,” Sharma said. “For them, things changed and then what they realized is that they did not have effective means of formal employee communication and also lacked the digital employee experience — and they realized that very quickly.”
Simpplr is obviously not the only intranet solution on the market, but Sharma argues that the service isn’t just recognized by analyst firms like Gartner and Forrester, but also highly reviewed by its customers, in large part thanks to its focus on user experience. “UX is our number one strength and differentiator. We have been pushing the boundaries of intranet for the last five years,” he said and cited features like the company’s auto-governance engine, which he likened to a “Roomba for your intranet.”
Image Credits: Simpplr
Analytics, too, is another area where Simpplr is trying to differentiate itself. “Our company’s mission is to help companies build a better workplace — and unless we can show the areas of improvement and provide insights like how to do something better, we just become a dumb tool,” he said. “For us, what is very important is not only that you are communicating but helping our customers to understand what’s working and what’s not working. What’s the impact of the communication and how are your employees feeling about it?”
Looking ahead, the company is working on building more AI into its tools — including its analytics — to help companies better communicate with their employees and understand the impact of those messages.
As for the new funding round, Sharma noted that he bootstrapped his previous two companies, which has made him take a somewhat conservative approach to fundraising. “When I used to hear that your investors or VCs expect growth at all costs, I just could never understand that,” he said. “So while building this company, even though this is a venture-funded company, I still wanted to make sure that I use the finances responsibly and I build a business in a sustainable manner. I wanted to make sure that if we raised a large investment, we have a proper use for that investment and that this investment will bring the right results.”
Tola Capital principal Eddie Kang will now join Simpplr’s board. “The future of work is hybrid and Simpplr is essential to a company’s ability to engage with employees,” he said. “As enterprise software investors, what excites us about Simpplr’s platform is that it allows leadership teams to streamline communications across channels and provides a turnkey platform that drives value to customers very quickly. Our partnership with Simpplr will accelerate its roadmap to meet the needs of global business leaders and communications teams.”
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Build a digital ops toolbox to streamline business processes with hyperautomation
Reliance on a single technology as a lifeline is a futile battle now. When simple automation no longer does the trick, delivering end-to-end automation needs a combination of complementary technologies that can give a facelift to business processes: the digital operations toolbox.
According to a McKinsey survey, enterprises that have likely been successful with digital transformation efforts adopted sophisticated technologies such as artificial intelligence, Internet of Things or machine learning. Enterprises can achieve hyperautomation with the digital ops toolbox, the hub for your digital operations.
The hyperautomation market is burgeoning: Analysts predict that by 2025, it will reach around $860 billion.
The toolbox is a synchronous medley of intelligent business process management (iBPM), robotic process automation (RPA), process mining, low code, artificial intelligence (AI), machine learning (ML) and a rules engine. The technologies can be optimally combined to achieve the organization’s key performance indicator (KPI) through hyperautomation.
The hyperautomation market is burgeoning: Analysts predict that by 2025, it will reach around $860 billion. Let’s see why.
The purpose of a digital ops toolbox
The toolbox, the treasure chest of technologies it is, helps with three crucial aspects: process automation, orchestration and intelligence.
Process automation: A hyperautomation mindset introduces the world of “automating anything that can be,” whether that’s a process or a task. If something can be handled by bots or other technologies, it should be.
Orchestration: Hyperautomation, per se, adds an orchestration layer to simple automation. Technologies like intelligent business process management orchestrate the entire process.
Intelligence: Machines can automate repetitive tasks, but they lack the decision-making capabilities of humans. And, to achieve a perfect harmony where machines are made to “think and act,” or attain cognitive skills, we need AI. Combining AI, ML and natural language processing algorithms with analytics propels simple automation to become more cognitive. Instead of just following if-then rules, the technologies help gather insights from the data. The decision-making capabilities enable bots to make decisions.
Simple automation versus hyperautomation
Here’s a story of evolving from simple automation to hyperautomation with an example: an order-to-cash process.
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Where is suptech heading?
Technology plays a huge role in nearly every aspect of financial services today. As the world moved online, tools and infrastructure to help people manage their money and make payments have burgeoned the world over in the past decade.
With much of the finance world now leveraging technology to conduct business, predict trends and deliver services, financial services regulators are also developing new technologies to monitor markets, supervise financial institutions and conduct other administrative activities. The emergence of purpose-built technologies to facilitate regulator oversight has, over the past few years, garnered its own moniker of supervisory technology, or suptech.
Interest in suptech is proliferating across the globe thanks to a diverse set of prudential and conduct regulators. A sampling of regulators developing suptech include the FDIC, CFPB, FINRA and Federal Reserve in the U.S.; the U.K.’s FCA and Bank of England; the National Bank of Rwanda in Africa; as well as the ASIC, HKMA and MAS in Asia. Several “super regulators” are also engaged in suptech efforts such as the Bank of International Settlements, the Financial Stability Board and the World Bank.
The strides in suptech demonstrate that creative thinking coupled with experimentation and scalable, easily accessible technologies are jump-starting a new approach to regulation.
In this post, we’ll examine a few core suptech use cases, consider its future and explore the challenges facing regulators as the market matures. The uses are diverse, so we’ll focus on three key areas: regulatory reporting, machine-readable regulation, and market and conduct oversight.
A quick general note: Nearly every financial services regulator is engaged in some type of suptech activity and the use cases discussed in this article are intended as a sample, not a comprehensive list.
But what exactly is suptech?
As a preliminary matter, we should quickly survey a few definitions of suptech to frame our understanding. Both the World Bank and BIS have offered definitions that provide useful outlines for this discussion. The World Bank states that suptech “refers to the use of technology to facilitate and enhance supervisory processes from the perspective of supervisory authorities.” It’s a little circular, but helpful.
The BIS defines suptech as “the use of technology for regulatory, supervisory and oversight purposes.” This is a similarly loose definition that describes the broader scope better.
Regardless of differences on the margins, the “sup” in these suptech definitions acknowledges the primacy of the idea that regulators’ objectives are to oversee the conduct, structure, and health of the financial system. Suptech technologies facilitate related regulatory supervision and enforcement processes.
Regulatory reporting
Regulatory reporting refers to a broad swath of activities such as financial firms providing trading data to regulatory authorities and regulators’ analysis of financial data or corporate information to determine the projected health or potential risks facing an institution or the market.
The MAS and FDIC are incorporating transactional and financial data reported by firms as a means to assess their financial viability. The MAS, in conjunction with BIS, has run tech sprints soliciting new ideas relating to regulatory reporting, while the FDIC has “a regulatory reporting solution that would allow ‘on-demand’ monitoring of banks as opposed to being constrained by ‘point-in-time’ reporting. This project is particularly targeted at smaller, community banks that provide only aggregated data on their financial health on a quarterly basis.”
The HKMA recently outlined its three-year plan for the development of suptech, which includes developing an approach to “network analysis.” The HKMA will analyze reporting data related to corporate shareholding and financial exposure to bring them “to life as network diagrams, so that the relationships between different entities become more apparent. Greater transparency of the connections and dependencies between banks and their customers will enable HKMA supervisors to detect early warning signals within the entire credit network.”
These reporting initiatives touch on a theme regulators have continuously struggled with: How to regulate markets and firms based on a reactive approach to historical data. Regulation and enforcement are often retrospective activities — examining past behavior and data to decide how to sanction an organization or develop a regulatory framework to govern a particular type of activity or financial product. This can result in an approach to regulation too rooted in past failures, which might lack the flexibility to anticipate or adapt to emerging risks or financial products.
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