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Mendel raises $18M to tease out data structure from medicine’s disparate document trove
The medical industry is sitting on a huge trove of data, but in many cases it can be a challenge to realize the value of it because that data is unstructured and in disparate places.
Today, a startup called Mendel, which has built an AI platform both to ingest and bring order to that body of information, is announcing $18 million in funding to continue its growth and to build out what it describes as a “clinical data marketplace” for people not just to organize, but also to share and exchange that data for research purposes. It’s also going to be using the funding to hire more talent — technical and support — for its two offices, in San Jose, California and Cairo, Egypt.
The Series A round is being led by DCM, with OliveTree, Zola Global, and MTVLP, and previous backers Launch Capital, SOSV, Bootstrap Labs and chairman of UCSF Health Hub Mark Goldstein also participating.
The funding comes on the heels of what Mendel says is a surge of interest among research and pharmaceutical companies in sourcing better data to gain a better understanding of longer-term patient care and progress, in particular across wider groups of users, not just at a time when it has been more challenging to observe people and run trials, but in light of the understanding that using AI to leverage much bigger data sets can produce better insights.
This can be important, for example, in proactively identifying symptoms of particular ailments or the pathology of a disease, but also recurring and more typical responses to specific treatment courses.
We previously wrote about Mendel back in 2017 when the company had received a seed round of $2 million to better match cancer patients with the various clinical trials that are regularly being run: the idea was that certain trials address specific types of cancers and types of patients, and those who are willing to try newer approaches will be better or worse suited to each of these.
It turned out, however, that Mendel discovered a problem in the data that it would have needed to enable its matching algorithms to work, said Dr. Karim Galil, Mendel’s CEO and founder.
“As we were trying to build the trial business, we discovered a more basic problem that hadn’t been solved,” he said in an interview. “It was the reading and understanding medical records of a patient. If you can’t do that you can’t do trial matching.”
So the startup decided to become an R&D shop for at least three years to solve that problem before doing anything with trials, he continued.
Although there are today many AI companies that are parsing unstructured information in order to extract better insights, Mendel is what you might think of as part of the guard of tech companies that are building out specific AI knowledge bases for distinct verticals or areas of expertise. (Another example from another vertical is Eigen, working in the legal and finance industries, while Google’s DeepMind is another major AI player looking at ways of better harnessing data in the sphere of medicine.)
The issue of “reading” natural language is more nuanced than you might think in the world of medicine. Galil compared it to the phrase “I’m going to leave you” in English, which could just as easily mean someone is departing, say, a room, as someone is walking out of a relationship. The “true” answer — and as we humans know even truth can be elusive — can only start to be found in the context.
The same goes for doctors and their observation notes, Galil said. “There is a lot hidden between the lines, and problems can be specific to a person,” or to a situation.
That has proven to be a lucrative area to tackle.
Mendel uses a mix of computer vision and natural language processing built by teams with extensive experience in both clinical environments and in building AI algorithms and currently provides tools to automate clinical data abstraction, OCR, special tools to redact and remove personal identifiable information automatically to share records, search engines to search clinical data and — yes — an engine to enable better matching of people to clinical trials. Customers include pharmaceutical and life science companies, real-world data and real-world evidence (RWD and RWE) providers and research groups.
And to underscore just how much there is still left to do in the world of medicine, along with this funding round, Mendel is announcing a partnership with eFax, an online faxing solution used by a huge number of healthcare providers.
Faxing is totally antiquated in some parts of the world now — I’m not even sure that people the age of my children (tweens) even know what a “fax” is — but they remain one of the most-used ways to transfer documents and information between people in the worlds of healthcare and medicine, with 90% of the industry using them today. The partnership with Mendel will mean that those eFaxes will now be “read” and digitized and ingested into wider platforms to tap that data in a more useful way.
“There is huge potential for the global healthcare industry to leverage AI,” said Mendel board member and partner at DCM, Kyle Lui, in a statement. “Mendel has created a unique and seamless solution for healthcare organizations to automatically make sense of their clinical data using AI. We look forward to continuing to work with the team on this next stage of growth.”
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Metafy adds $5.5M to its seed round as the market for games coaching grows
This morning Metafy, a distributed startup building a marketplace to match gamers with instructors, announced that it has closed an additional $5.5 million to its $3.15 million seed round. Call it a seed-2, seed-extension or merely a baby Series A; Forerunner Ventures, DCM and Seven Seven Six led the round as a trio.
Metafy’s model is catching on with its market. According to its CEO Josh Fabian, the company has grown from incorporation to gross merchandise volume (GMV) of $76,000 in around nine months. That’s quick.
The startup is building in public, so we have its raw data to share. Via Fabian, here’s how Metafy has grown since its birth:
From the company. As a small tip, if you want the media to care about your startup’s growth rate, share like this!
When TechCrunch first caught wind of Metafy via prior seed investor M25, we presumed that it was a marketplace that was built to allow esports pros and other highly capable gamers teach esports-hopefuls get better at their chosen title. That’s not the case.
Don’t think of Metafy as a marketplace where you can hire a former professional League of Legends player to help improve your laning-phase AD carry mechanics. Though that might come in time. Today a full 0% of the company’s current GMV comes from esports titles. Instead, the company is pursuing games with strong niche followings, what Fabian described as “vibrant, loyal communities.” Like Super Smash Brothers, its leading game today in terms of GMV generated.
Why pursue those titles instead of the most competitive games? Metafy’s CEO explained that his startup has a particular take on its market — that it focuses on coaches as its core customer, over trainees. This allows the startup to focus on its mission of making coaching a full-time gig, or at least one that pays well enough to matter. By doing so, Metafy has cut its need for marketing spend, because the coaches that it onboards bring their own audience. This is where the company is targeting games with super-dedicated user bases, like Smash. They fit well into its build for coaches, onboard coaches, coaches bring their fans, GMV is generated model.
Metafy has big plans, which brings us back to its recent raise. Fabian told TechCrunch any game with a skill curve could wind up on Metafy. Think chess, poker or other games that can be played digitally. To build toward that future, Metafy decided to take on more capital so that it could grow its team.
So what does its $5.5 million unlock for the startup? Per its CEO, Metafy is currently a team of 18 with a monthly burn rate of around $80,000. He wants it to grow to 30 folks, with nearly all of its new hires going into its product org, broadly.
TechCrunch’s perspective is that gaming is not becoming mainstream, but that it has already done so. Building for the gaming world, then, makes good sense, as tools like Metafy won’t suffer from the same boom/bust cycles that can plague game developers. Especially as the startup becomes more diversified in its title base.
Normally we’d close by noting that we’ll get back in touch with the company in a few quarters to see how it’s getting on in growth terms. But because it’s sharing that data publicly, we’ll simply keep reading. More when we have a few months’ more data to chew on.
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DCM is poised to make roughly $1 billion off its $26 million bet on Bill.com
David Chao, the cofounder of the cross-border venture firm DCM, speaks English, Japanese, and Mandarin. But he also knows how to talk to founders.
It’s worth a lot. Consider that DCM could see more than $1 billion from the $26.4 million it invested across 14 years in the cloud-based business-to-business payments company Bill.com, starting with its A round. Indeed, by the time Bill.com went public last December, when its shares priced at $22 apiece, DCM’s stake — which was 16% sailing into the IPO — was worth a not-so-small fortune.
Since then, Wall Street’s lust for both digital payments and subscription-based revenue models has driven Bill.com’s shares to roughly $90 each. Little wonder that in recent weeks, DCM has sold roughly 70 percent of a stake that’s currently valued at roughly $900 million and was worth more than $1 billion a few weeks ago. (It still owns 30 percent of its position and says the shares are free and clear to trade.)
We talked with Chao earlier today about Bill.com, on whose board he sits and whose founder, René Lacerte, is someone Chao backed previously. We also talked about another very lucrative stake DCM holds right now, about DCM’s newest fund, and about how Chao navigates between the U.S. and China as relations between the two countries worsen. Our conversation has been edited lightly for length and clarity.
TC: I’m seeing you owned about 33% of Bill.com after the first round. How did that initial check come to pass? Had you invested before in Lacerte?
DC: That’s right. René started [an online payroll] company called PayCycle and we’d backed him and it sold to Intuit [in 2009] and René made good money and we made money. And when he wanted to start this next thing, he said, ‘Look, I want to do something that’s a bigger outcome. I don’t want to sell the company along the way. I just want this time to do a big public company.’
TC: Why did he sell PayCycle if that was his ambition?
DC: It was largely because when you’re a first-time CEO and entrepreneur and a large company offers you the chance to make millions and millions of dollars, you’re a bit more tempted to sell the company. And it was a good price. For where the company was, it was a decent price.
Bill.com was a little bit different. We had good offers before going public. We even had an offer right before we went public. But René said, ‘No, this time, I want to go all the way.’ And he fulfilled that promise he’d made to himself. It’s a 14-year success story.
TC: You’ve sold most of your stake in recent weeks; how does that outcome compare with other recent exits for DCM?
DC: We actually have another recent one that’s phenomenal. We invested in a company called Kuaishou in China. It’s the largest competitor to Bytedance’s TikTok in China. We’ve invested $49.3 million altogether and now that stake is worth $3.8 billion. The company is still private held, but we actually cashed out around 15% of our holdings. and with just that sale alone we’ve already [seen 10 times] that $30 million.
TC: How do you think about selling off your holdings, particularly once a company has gone public?
DC: It’s really case by case. In general, once a company goes public, we probably spend somewhere between 18 months to three years [unwinding our position]. We had two big IPOs in Japan last year. One company [has] a $1.6 billion market cap; the other is a $2.6 billion company. There are some [cases] that are 12 months and there are some [where we own some shares] for four or five years.
TC: What types of businesses are these newly public companies in Japan?
DC: They’re both B2B. One is pretty much the Bill.com of Japan. The other makes contact management software
TC: Isn’t DCM also an investor in Blued, the LGBTQ dating app that went public in the U.S. in July?
DC: Yes, our stake wasn’t very big, but we were probably the first major VC to jump in because it was controversial.
TC: I also saw that you closed a new $880 million early stage fund this summer.
DC: Yes, that’s right. It was largely driven by the fact that many of our funds have done well. We’re now on fund nine, but our fund seven is on paper today 9x, and even the fund that Bill.com is in, fund four, is now more than 3x. So is fund five. So we’re in a good spot.
TC: As a cross-border fund, what does the growing tension between the U.S and China mean for your team and how it operates?
DC: It’s not a huge impact. If we were currently investing in semiconductor companies, for example, I think it would be a pretty rough period, because [the U.S.] restricts all the money coming from any foreign sources. At least, you’d be under strong scrutiny. And if we invested in a semiconductor company in China, you might not be able to go public in the U.S.
But the kinds of deals that we do, which are largely B2B and B2C — more on the software and services side — they aren’t as impacted. I’d say 90% of our deals in China focus on the domestic market. And so it doesn’t really impact us as much.
I think some of the Western institutions putting money into the Chinese market — that might be decreasing, or at least they’re a little bit more on the sidelines, trying to figure out whether they should be continuing to invest in China. And maybe for Chinese companies, less companies will go public in the U.S., etcetera. But some of these companies can go public in Hong Kong.
TC: How you feel about the U.S. administration’s policies? Do you understand them? Are you frustrated by them?
DC: I think it requires patience, because what [is announced and] goes on the news, versus what is really implemented and how it truly affects the industry, there’s a huge gap.
[Correction: This story originally reported that DCM had sold nearly $900 worth of shares and maintains another 30%; the firm’s entire position is currently worth $900 million, with 30% of those shares still held.]
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Fountain, a platform for recruiting gig and hourly workers, raises $23M
Contract, self-employed and temporary jobs are on the rise in developed markets, with some 85% of the global workforce, 2.7 billion people, estimated to be on some form of hourly wage rather than flat salary.
Today, a startup that helps companies source these kinds of candidates is announcing a round of funding to help meet that demand. Fountain, which has built a platform to find and screen candidates for field roles — not knowledge-worker desk jobs, but hourly work that likely has you on your feet — has raised $23 million, money that it will be using to continue expanding its platform, the kinds of services it provides to its customers and its geographical footprint.
Fountain already has some scale: The company currently sources and processes more than 1 million inbound candidate applications each month, filling some 150,000 jobs in the process, CEO and founder Keith Ryu said in an interview.
In addition to building engines to source candidates through a number of channels, such as traditional job boards, social media channels, a company’s own site and more, Fountain then helps with screening, interview scheduling, background checks (using third-party providers for this part), communicating with the candidate, handling the paperwork and, finally, onboarding.
Led by DCM, this latest round also included a potentially strategic backer, the Chinese recruitment site 51job, as well as Origin Ventures, Uncork Capital and others that are not being named. This brings the total raised by Fountain, which previously was called OnboardIQ and had been incubated in Y Combinator, to $34 million.
Fountain’s business targets two main kinds of employers. First, ridesharing companies like Uber, delivery startups like Postmates and home services providers like Thumbtack all function by virtue of their pools of “gig” workers, self-employed people who choose their own working hours and dip into the platforms for assignments when they have time to fulfill them.
But the challenge of finding good people for field jobs is not venture-backed startups’ alone. The second big category that Fountain taps for business is the wider pool of retail and food industry businesses that have long relied on hourly workers but also find it hard to source qualified and reliable people.
Between those two, Ryu said that customers cover big “gig economy” businesses like Uber Eats, Caviar and Cabify; large fast food franchises, including Taco Bell, Burger King and KFC chains; and a number of other customers that use Fountain’s APIs for white-label services and prefer not to be named. (I think it’s interesting that Uber Eats is on Fountain’s customer list, but Uber is not.)
Fountain was founded in 2015, arguably at the peak of demand for recruiting gig economy workers. In the years since then, and especially in recent times, demands have moved away for these companies from aggressive expansion (bringing on, for example, lots of new drivers), and into more profitable operations. Ryu said that the knock-on effect for Fountain has not been a reduction, but a change, in terms of the services required, with some companies opting to outsource, whereas in the past they might have handled recruitment in-house.
“There has been some attention to reducing operating costs per driver, including driver acquisition,” he said. “That is where we have been getting involved, using our size [and reach] to reduce the cost to the employer.”
This also has had the effect of also seeing Fountain change up its own strategy to make more of an effort to target more traditional businesses that are based around hourly employees: no longer contractors, but still very much in the field.
“As the unrivaled leader in gig hiring and recruiting, Fountain is already reshaping the way billions of job seekers interact with employers,” says David Chao, co-founder and partner at DCM, in a statement. “Fountain has been exceptionally capital efficient and has best-in-class customer retention,” adds Kyle Lui, partner at DCM.
Fountain is not disclosing its valuation with this round. In its last round, back in 2017, it had a very modest $40 million price on it, although given its growth since then (it had sourced 5 million candidates in two years in 2017; now it sources 1 million each month) this is likely to be significantly higher.
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Stride Health Launches A New Mobile App For Its Healthcare Recommendation Service
Stride Health has launched a new mobile-focused version of its healthcare recommendation engine targeting the beleaguered workers who comprise the nation’s 1099 laborers. Essentially Stride acts as a private competitor to the federally funded healthcare.gov. The company says its service provides a high-tech recommendation engine for healthcare coverage that’s tailored to suit… Read More
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DCM Is Raising Another $100 Million Fund To Make Investments In Android-Based Startups
It looks like global venture firm DCM plans to make more bets on Android apps, with another fund that seems to be devoted to investing in startups that develop for the mobile OS. According to an SEC filing, it’s seeking to raise $100 million for A-Fund II, the second strategic fund aiming to take advantage of innovation in the Android ecosystem. The first A-Fund was raised in 2011 when… Read More
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