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Remote raises $150M on a $1B+ valuation to manage payroll and more for organizations’ global workforces
For many of us, going to work these days no longer means going into a specific office like it used to; and today one of the startups that’s built a platform to help cater to that new, bigger world of employment — wherever talent might be — is announcing a major round of funding on the back of strong demand for its tools.
Remote, which provides tools to manage onboarding, payroll, benefits and other services for tech and other knowledge workers located in remote countries — be they contractors or full-time employees — has raised $150 million. Job van der Voort, the Dutch-based CEO and co-founder of New York-based Remote, confirmed in an interview that funding values Remote at over $1 billion.
Accel is leading this Series B, with participation also from previous investors Sequoia, Index Ventures, Two Sigma, General Catalyst and Day One Ventures.
The funding will be used in a couple of areas. First and foremost, it will go toward expanding its business to more markets. The startup has been built from the ground up in a fully integrated way, and in contrast to a number of others that it competes with in providing Employer of Record services, Remote fully owns all of its infrastructure. It now provides its HR services, as fully operational legal entities, for 50 countries (it has a target of growing that to 80 by the end of this year). The platform is also set to be enhanced with more tools around areas like benefits, equity incentive planning, visa and immigration support and employee relocation.
“We are doubling down on our approach,” van der Voort said. “We try to fully own the entire stack: entity, operations, experts in house, payroll, benefits and visa and immigration — all of the items that come up most often. We want to to build infrastructure products, foundational products because those have a higher level of quality and ultimately a lower price.”
In addition, Remote will be using the funding to continue building more tools and partnerships to integrate with other providers of services in what is a very fragmented human resources market. Two of these are being announced today to coincide with the funding news: Remote has launched a Global Employee API that HR platforms that focus on domestic payroll can integrate to provide their own international offering powered by Remote. HR platform Rippling (Parker Conrad’s latest act) is one of its first customers. And Remote is also getting cosier with other parts of the HR chain of services: applicant tracking system Greenhouse is now integrating with it to help with the onboarding process for new hires.
Indeed, $150 million at a $1 billion+ valuation is a very, very sizable Series B, even by today’s flush-market standards, but it comes after a bumper year for the company, and in particular since November last year when it raised a Series A of $35 million. In the last nine months, customer numbers have grown seven-fold, with users on the platform increasing 10 times. Most interestingly, perhaps, is that Remote’s revenues — its packages start at $149 per month but go up from there — have increased by a much bigger amount: 65x, the company said. That basically points to the fact that engagement from those users — how much they are leaning on Remote’s tech — has skyrocketed.
Although there are a lot of competitors in the same space as Remote — they include a number of more local players alongside a pretty big range of startups like Oyster (which announced $50 million in funding in June), Deel, which is now valued at $1.25 billion; Turing; Papaya Global (now also valued at over $1 billion); and many more — the opportunity they are collectively tackling is a massive one that, if anything, appears to be growing.
Hiring internationally has always been a costly, time-consuming and organizationally challenged endeavor, so much so that many companies have opted not to do it at all, or to reserve it for very unique cases. That paradigm has drastically shifted in recent years, however.
Even before COVID-19 hit, there was a shortage of talent, resulting in a competitive struggle for good people, in companies’ home markets, which encouraged companies to look further afield when hiring. Then, once looking further afield, those employers had to give consideration to employing those people remotely — that is, letting them work from afar — because the process of relocating them had also become more expensive and harder to work through.
Then COVID-19 happened, and everyone, including people working in a company’s HQ, started to work remotely, changing the goalposts yet again on what is expected by workers, and what organizations are willing to consider when bringing on a new person, or managing someone it already knows, just from a much farther distance.
While a lot of that has played out in the idea of relocating to different cities in the same country — Miami and Austin getting a big wave of Silicon Valley “expats” being two examples of that — it seems just a short leap to consider that now that sourcing and managing is taking on a much more international slant. A lot of new hires, as well as existing employees who are possibly not from the U.S. to begin with, or simply want to see another part of the world, are now also a part of the mix. That is where companies like Remote are coming in and lowering the barriers to entry by making it as easy to hire and manage a person abroad as it is in your own city.
“Remote is at the center of a profound shift in the way that companies hire,” said Miles Clements, a partner at Accel, in a statement. “Their new Global Employee API opens up access to Remote’s robust global employment infrastructure and knowledge map, and will help any HR provider expand internationally at a speed impossible before. Remote’s future vision as a financial services provider will consolidate complicated processes into one trusted platform, and we’re excited to partner with the global leader in the quickly emerging category of remote work.”
And it’s interesting to see it now partnering with the likes of Rippling. It was a no-brainer that as the latter company matured and grew, it would have to consider how to handle the international component. Using an API from Remote is an example of how the model that has played out in communications (led by companies like Twilio and Sinch) and fintech (hello, Stripe) also has an analogue in HR, with Remote taking the charge on that.
And to be clear, for now Remote has no plans to build a product that it would sell directly to individuals.
“Individuals are reaching out to us, saying, ‘I found this job and can you help me and make sure I get paid?’ That’s been interesting,” van der Voort said. “We thought about [building a product for them] but we have so much to do with employers first.” One thing that’s heartening in Remote’s approach is that it wouldn’t want to provide this service unless it could completely follow through on it, which in the case of an individual would mean “vetting every major employer,” he said, which is too big a task for it right now.
In the meantime, Remote itself has walked the walk when it comes to remote working. Originally co-founded by two European transplants to San Francisco, the pair had firsthand experience of the paradoxical pains and opportunities of being in an organization that uses remote workforces.
Van der Voort had been the VP of product for GitLab, which he scaled from five to 450 employees working remotely (it’s now a customer of Remote’s); and before co-founding Remote, CTO Marcelo Lebre had been VP of engineering for Unbabel — another startup focused on reducing international barriers, this time between how companies and global customers communicate.
Today, not only is the CEO based out of Amsterdam in The Netherlands, with the CTO in Lisbon, Portugal, but New York-based Remote itself has grown to 220 from 50 employees, and this wider group has also been working remotely across 47 countries since November 2020.
“The world is looking very different today,” van der Voort said. “The biggest change for us has been the size of the organization. We’ve gone from 50 to more than 200 employees, and I haven’t met any of them! We have tried to follow our values of bringing opportunity everywhere so we hire everywhere as we solve that for our customers, too.”
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Quantexa raises $153M to build out AI-based big data tools to track risk and run investigations
As financial crime has become significantly more sophisticated, so too have the tools that are used to combat it. Now, Quantexa — one of the more interesting startups that has been building AI-based solutions to help detect and stop money laundering, fraud and other illicit activity — has raised a growth round of $153 million, both to continue expanding that business in financial services and to bring its tools into a wider context, so to speak: linking up the dots around all customer and other data.
“We’ve diversified outside of financial services and working with government, healthcare, telcos and insurance,” Vishal Marria, its founder and CEO, said in an interview. “That has been substantial. Given the whole journey that the market’s gone through in contextual decision intelligence as part of bigger digital transformation, was inevitable.”
The Series D values the London-based startup between $800 million and $900 million on the heels of Quantexa growing its subscriptions revenues 108% in the last year.
Warburg Pincus led the round, with existing backers Dawn Capital, AlbionVC, Evolution Equity Partners (a specialist cybersecurity VC), HSBC, ABN AMRO Ventures and British Patient Capital also participating. The valuation is a significant hike up for Quantexa, which was valued between $200 million and $300 million in its Series C last July. It has now raised over $240 million to date.
Quantexa got its start out of a gap in the market that Marria identified when he was working as a director at Ernst & Young tasked with helping its clients with money laundering and other fraudulent activity. As he saw it, there were no truly useful systems in the market that efficiently tapped the world of data available to companies — matching up and parsing both their internal information as well as external, publicly available data — to get more meaningful insights into potential fraud, money laundering and other illegal activities quickly and accurately.
Quantexa’s machine learning system approaches that challenge as a classic big data problem — too much data for a human to parse on their own, but small work for AI algorithms processing huge amounts of that data for specific ends.
Its so-called “Contextual Decision Intelligence” models (the name Quantexa is meant to evoke “quantum” and “context”) were built initially specifically to address this for financial services, with AI tools for assessing risk and compliance and identifying financial criminal activity, leveraging relationships that Quantexa has with partners like Accenture, Deloitte, Microsoft and Google to help fill in more data gaps.
The company says its software — and this, not the data, is what is sold to companies to use over their own data sets — has handled up to 60 billion records in a single engagement. It then presents insights in the form of easily digestible graphs and other formats so that users can better understand the relationships between different entities and so on.
Today, financial services companies still make up about 60% of the company’s business, Marria said, with seven of the top 10 U.K. and Australian banks and six of the top 14 financial institutions in North America among its customers. (The list includes its strategic backer HSBC, as well as Standard Chartered Bank and Danske Bank.)
But alongside those — spurred by a huge shift in the market to rely significantly more on wider data sets, to businesses updating their systems in recent years, and the fact that, in the last year, online activity has in many cases become the “only” activity — Quantexa has expanded more significantly into other sectors.
“The Financial crisis [of 2007] was a tipping point in terms of how financial services companies became more proactive, and I’d say that the pandemic has been a turning point around other sectors like healthcare in how to become more proactive,” Marria said. “To do that you need more data and insights.”
So in the last year in particular, Quantexa has expanded to include other verticals facing financial crime, such as healthcare, insurance, government (for example in tax compliance) and telecoms/communications, but in addition to that, it has continued to diversify what it does to cover more use cases, such as building more complete customer profiles that can be used for KYC (know your customer) compliance or to serve them with more tailored products. Working with government, it’s also seeing its software getting applied to other areas of illicit activity, such as tracking and identifying human trafficking.
In all, Quantexa has “thousands” of customers in 70 markets. Quantexa cites figures from IDC that estimate the market for such services — both financial crime and more general KYC services — is worth about $114 billion annually, so there is still a lot more to play for.
“Quantexa’s proprietary technology enables clients to create single views of individuals and entities, visualized through graph network analytics and scaled with the most advanced AI technology,” said Adarsh Sarma, MD and co-head of Europe at Warburg Pincus, in a statement. “This capability has already revolutionized the way KYC, AML and fraud processes are run by some of the world’s largest financial institutions and governments, addressing a significant gap in an increasingly important part of the industry. The company’s impressive growth to date is a reflection of its invaluable value proposition in a massive total available market, as well as its continued expansion across new sectors and geographies.”
Interestingly, Marria admitted to me that the company has been approached by big tech companies and others that work with them as an acquisition target — no real surprises there — but longer term, he would like Quantexa to consider how it continues to grow on its own, with an independent future very much in his distant sights.
“Sure, an acquisition to the likes of a big tech company absolutely could happen, but I am gearing this up for an IPO,” he said.
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Vaayu’s carbon tracking for retailers raises $1.6M, claims it could cut CO2 in half by 2030
Carbon tracking is very much the new hot thing in tech, and we’ve previously covered more generalist startups doing this at scale for companies, such as Plan A Earth out of Berlin.
But there’s clearly an opportunity to get deep into a vertical sector and tailor solutions to it.
That’s the plan of Vaayu, a carbon tracking platform aimed specifically at retailers. It has now raised $1.57 million in pre-seed funding in a round led by CapitalT. Several angels also took part, including Atomico’s Angel Program, Planet Positive LP, Saarbrücker 21, Expedite Ventures and NP-Hard Ventures.
Carbon tracking for the retail fashion industry, in particular, is urgently needed. Unfortunately, the fashion industry remains responsible for 10% of annual global carbon emissions, which ads up to more than all international flights and maritime shipping combined.
Vaayu says it integrates with various point-of-sale systems, such as Shopify and Webflow. It then pulls in data on logistics, operations and packaging to monitor, measure and reduce their carbon emissions. Normally, retailers calculate emissions once a year, which is obviously far less accurate.
Vaayu was founded in 2020 by Namrata Sandhu (CEO), former head of Sustainability at fashion retailer Zalando, as well as Anita Daminov (CPO) and Luca Schmid (CTO). Vaayu currently has 25 global brand customers, including Missoma, Armed Angels and Organic Basics.
Commenting on the fundraise, Sandhu said: “We have only nine short years left to achieve the UN’s goal of reducing carbon emissions by 50% by 2030 and as the third-largest contributor to global emissions, retailers need to take action — and fast. Vaayu is here to help retailers measure, monitor, and reduce their carbon footprint at scale across the entire supply chain — something that I know from my own experience can be complex and expensive.”
Speaking to me over a call, Sandhu told me: “Putting the focus on retail basically allows us to automate the calculation, which means in three clicks you can get your carbon footprint right away. That then allows us to really get accurate data, and with that, we can basically do reductions specific to the business but using software, rather than any kind of manual intervention or a kind of ‘intermediate’ state where you need to put together an Excel sheet. Because we focus on retail we can automate the entire process and also automate the reductions.”
“We are delighted to be backed by female-led CapitalT who understood us and our vision right from the start. We look forward to developing Vaayu further in the coming months so we can reach as many retailers as possible and help put the brakes on the impending climate crisis,” she added.
Janneke Niessen, founding partner, CapitalT commented: “We are very excited to join Vaayu on their mission to reduce carbon emission for retailers worldwide. The Vaayu product is very scalable and its quick and easy implementation allows for fast adoption. We are confident that with this experienced team, Vaayu will soon be one of the fastest-growing climate tech companies in Europe and the world.”
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The case for funding fusion
Digital technologies have disrupted the structure of markets with unprecedented breadth and scale. Today, there is yet another wave of innovation emerging, and that is the decarbonization of the global economy.
While governments still lack the conviction necessary to truly fight the climate crisis, the overall direction is clear. The carbon price in Europe rose from below $10 to over $50 per ton. Shell was handed a resounding defeat by a Dutch court. The major blackout in Texas at the beginning of the year revealed the fragility of the existing energy supply even in a highly industrialized country. We must urgently invest more into developing and deploying reliable, clean electricity generation technologies to make decarbonization a reality.
Forward-thinking investors understand this. Global investment in low-carbon technologies climbed to $500 billion in 2020, according to Bloomberg. Renewable energy accounted for around $300 billion of that, followed by electrification of transport ($140 billion) and heating ($50 billion).
However, we remain far from the finish line. According to the International Energy Agency, global emissions of CO2 this year are set to jump 1.5 billion tons over 2020 levels. And more than 80% of global energy consumption is still made up of coal, oil and gas.
Fusion, the process that powers the stars, could be the cleanest energy source for humanity.
That’s why we need to continue backing new technologies with breakthrough potential. Of particular promise is nuclear fusion. Fusion, the process that powers the stars, could be the cleanest energy source for humanity. We are already indirectly harvesting the power of fusion through solar energy. Being able to build fusion reactors would give us an “always on” version, independent of weather conditions.
But why fund fusion at all, given that we don’t yet know how to do it? First, this isn’t an either-or proposition. We can afford to build out renewable energy and investigate new forms of energy production at the same time because the latter — at least at this early stage of development — will require a comparatively trivial amount of money. The U.S. government’s latest plan is to spend $174 billion over 10 years on the electrification of car transport alone, so to invest $2 billion to create a fusion power plant seems doable.
Second, we are about to need a lot more electricity than we ever have. The global demand for carbon-free energy sources is set to triple by 2050, driven by increasing urbanization, the electrification of industrial processes, the loss of biodiversity and the increase in energy consumption in emerging markets.
Third, there’s been tremendous progress in the necessary supporting technologies. Superconducting magnets for the magnetic-confinement approach to fusion have become much cheaper, lasers for inertial confinement fusion have become much more powerful, and breakthroughs in material science have made nanostructured targets available, which enable the use of completely new approaches to fusion, such as the low-neutronic fuel pB11.
Thankfully, there is a growing number of entrepreneurial efforts from world-class teams to try and build fusion. At least 25 startups around the world are targeting fusion right now, approaching the problem with a wide range of technologies. The amount invested in private fusion companies across the world increased tenfold to almost $1 billion in 2020, according to Crunchbase.
The upside of successful fusion is nearly unlimited. The clean energy generation market represents a trillion-dollar opportunity. An estimated 26 TW of primary energy capacity needs to be built globally from 2030 to 2050 to serve the rising global energy needs, according to Materials Research Society. Just 1 TW of capacity will generate $300 billion in revenue, and a 15% market share from 2030 to 2050 would yield more than $1 trillion in annual revenue.
We need many shots on goal here, which is why Susan Danziger and I have personally invested in three different fusion startups already (Zap Energy and Avalanche in the United States and Marvel Fusion in Germany).
But it is not primarily the potential for financial upside that motivates us: There is an opportunity to make an indelible difference in the trajectory of human history. If even a small fraction of the large wealth accumulated by entrepreneurs and investors in the last couple of decades is invested here, the likelihood of successful fusion rises dramatically. That, in turn, will unlock much more investment from both venture funds and governments.
Now is the time to go all-in on decarbonization. Funding fusion with its breakthrough potential must be part of that effort.
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PowerZ raises $8.3 million for its video game focused on education
French startup PowerZ has raised another $8.3 million (€7 million at today’s exchange rate) including $1.2 million (€1 million) in debt — the rest is a traditional equity round. The company is both an edtech startup and a video game studio with an ambitious goal — it wants to build a game that is as engaging as Minecraft or Fortnite, but with a focus on education.
In February, PowerZ launched the first version of its game on computers. It doesn’t have a lot of content, but the company wanted to start iterating as quickly as possible. Aimed at kids who are six years old and over, PowerZ teleports the player into a fantasy world with cute dragons and magic spells.
“The idea is really to build a sort of Harry Potter,” co-founder and CEO Emmanuel Freund told me. “You have this world that is super nice and very interesting. Like with Hogwarts, you want to come back regularly, and the story will progress over a very long time.”
15,000 children tried out the first chapter. On average, they spent four hours in the game. I asked whether Freund was satisfied with those metrics. He told me he thought his company’s vision was “completely validated.”
Bpifrance Digital Venture, RAISE Ventures and Bayard are investing in today’s round. Existing investors Educapital, Hachette Livres, Pierre Kosciusko-Morizet and Michaël Benabou are also investing once again.
Image Credits: PowerZ
Now, it’s time to add content, expand to other platforms and launch new languages. When it comes to content, the company wants to partner with other game studios. They’re going to create new islands and design games that make you learn new stuff. Zero Games, Opal Games and ArkRep are the first third-party studios to contribute to PowerZ.
When those new chapters are available, kids will be able to practice mental calculation, geometry, vocabulary, foreign languages, sign language, but also astronomy, photography, architecture, sculpture, cooking, wildlife, yoga, etc.
“Basically we want to position ourselves as a publisher,” Freund said. “The only thing we want to keep in-house is the main storyline.”
As for new platforms, PowerZ is launching its game on the iPad this week. The company realized that launching on computers was a mistake. Adults are already using computers or don’t want to leave your kid on the computer. That’s why PowerZ is starting with the iPad and the iPhone will follow suite. In 2022, the company expects to release its game on the Nintendo Switch and potentially other game consoles.
While the game is only available in French for now, the startup is also thinking about launching an English version soon.
“The game is completely free right now. We have an idea to monetize it. We’ll copy every other games with in-app purchases for visual items,” Freund said.
When you look further down the roadmap, PowerZ has some radically ambitious goals. Freund believes that educational games will become mainstream really quickly. Many companies don’t want to develop this kind of stuff because screens are bad for kids.
“If we just say that screens are bad, we’ll end up with an Amazon product to learn math. I feel a sense of urgency to develop an educational platform for screens that can scale,” Freund told me.
PowerZ wants to reach hundreds of thousands of children as quickly as possible. And just like Fortnite or Minecraft, the company believes its game can act as a platform for other stuff that can evolve over time.
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European challenger bank Bunq raises $228 million at $1.9 billion valuation
Amsterdam-based challenger bank Bunq has been self-funded by its founder and CEO Ali Niknam for several years. But the company has decided to raise some external capital, leading to the largest Series A round for a European fintech company.
The startup is raising $228 million (€193 million) in a round led by Pollen Street Capital. Bunq founder Ali Niknam is also participating in the round — he’s investing $29.5 million (€25 million) while Pollen Street Capital is financing the rest of the round.
As part of the deal, Bunq is also acquiring Capitalflow Group, an Irish lending company that was previously owned by … Pollen Street Capital.
Founded in 2012, Ali Niknam has already invested quite a bit of money into his own company. He poured $116.6 million (€98.7 million) of his own capital into Bunq — that doesn’t even take into account today’s funding round.
But it has paid off as the company expects to break even on a monthly basis in 2021. The company passed €1 billion in user deposits earlier this year. So why is the company raising external funding after turning down VC firms for so many years?
“Everything has a right time. In the beginning of Bunq, it was important to get a laser user focus in the company. Having to also focus on fundraises and the needs of investors distracts. Bunq now is mature enough to start scaling up significantly, so more capital is welcome,” Niknam said.
In particular, the company expects to acquire smaller companies to fuel its growth strategy. Challenger banks have also represented a highly competitive market over the past years in Europe. It’s clear that there will be some consolidation at some point.
Bunq offers bank accounts and debit cards that you can control from a mobile app. It works particularly well if your friends and family are also using Bunq as you can instantly send money, share a bunq.me payment link with other people, split payments and more.
In particular, if you’re going on a weekend trip, you can start an activity with your friends. It creates a shared pot that lets you share expenses with everyone. If you live with roommates, you can also create subaccounts to pay for bills from that account.
The company offers different plans that range from €2.99 per month to €17.99 per month — there’s also a free travel card with a limited feature set. By choosing a subscription-based business model, the startup has a clear path to profitability as most users are paid users.
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AnyVision, the controversial facial recognition startup, has raised $235M led by SoftBank and Eldridge
Facial recognition has been one of the more conflicted applications of artificial intelligence in the wider world: using computer vision to detect faces and subsequent identities of people has raised numerous questions about privacy, data protection, and the ethics underpinning the purposes of the work, and even the systems themselves. But on the other hand, it’s being adopted widely in a wide variety of use cases. Now one of the more controversial, but also successful, startups in the field has closed a big round of funding.
AnyVision — an Israeli startup that has built AI-based techniques to identify people by their faces, but also related tech such as temperature checks to detect higher temperatures in a crowd — has raised $235 million in funding, the company has confirmed.
This Series C, one of the bigger rounds for an AI startup, is being co-led by SoftBank’s Vision Fund 2 and Eldridge, with previous investors also participating. (They are not named but the list includes Robert Bosch GmbH, Qualcomm Ventures and Lightspeed.) The company is not disclosing its valuation but we are asking. However, it has to be a sizable hike for the company, which had previously raised around $116 million, according to PitchBook, and has racked up a big list of customers since its last round in 2020.
Worth noting, too, that AnyVision’s CEO Avi Golan is a former operating partner at SoftBank’s investment arm.
AnyVision said the funding will be used to continue developing its SDKs, specifically to work in edge computing devices — smart cameras, body cameras, and chips that will be used in other devices — to increase the performance and speed of its systems.
Its systems, meanwhile, are used in video surveillance, watchlist alerts, and scenarios where an organization is looking to monitor crowds and control them, for example to keep track of numbers, to analyse dwell times in retail environments, or to flag illegal or dangerous behavior.
“AnyVision’s innovations in Recognition AI helped transform passive cameras into proactive security systems and empowered organizations take a more holistic view to advanced security threats,” Golan said in a statement in the investment announcement. “The Access Point AI platform is designed to protect people, places, and privacy while simultaneously reducing costs, power, bandwidth, and operational complexity.”
You may recognize the name AnyVision because of how much it has been in the press.
The startup was the subject of a report in 2019 that alleged that its technology was being quietly used by the Israeli government to run surveillance on Palestinians in the West Bank.
The company denied it, but the story quickly turned into a huge stain on its reputation, while also adding more scrutiny overall to the field of facial recognition.
That led to Microsoft, which had invested in AnyVision via its M12 venture arm, to run a full audit of the investment and its position on facial recognition investments overall. Ultimately, Microsoft divested its stake and pledged not to invest in further technology like it.
Since then, AnyVision has been working hard to spin itself as the “ethical” player in this space, acknowledging that there is a lot of work and shortcomings in the bigger market of facial recognition. But controversy has continued to court the company.
A report from Reuters in April of this year highlighted just how many companies were using AnyVision’s technology today, ranging from hospitals like Cedars Sinai in Los Angeles to major retailers like Macy’s and energy giant BP. AnyVision’s connections to power go beyond simply having big customers: it also turns out that the White House Press Secretary, Jen Psaki, once served as a communications consultant to the startup.
Then, a report published just yesterday in The Markup, combed through various public records for AnyVision, including a user guidebook from 2019, which also painted a pretty damning picture of just how much information the company can collect, and what it has been working on. (One pilot, and subsequent report resulting from it, involved tracking children in a school district in Texas: AnyVision collected 5,000 student photos and ran more than 164,000 detections in just seven days.)
There are other cases where you might imagine, however, that AnyVision’s technology might be deemed helpful or useful, maybe even welcomed. Its ability to detect temperatures, for example, and identify who may have been in contact with high-temperature people, could go a long way towards controlling less obvious cases of Covid-19, for example, helping contain the virus at mass events, providing a safeguard to enable those events to go ahead.
And to be completely clear, AnyVision is not the only company building and deploying this technology, nor the only one coming under scrutiny. Another, the U.S. company Clearview AI, is used by thousands of governments and law enforcement agencies, but earlier this year it was deemed “illegal” by Canadian privacy authorities.
Indeed, it seems that the story is not complete, either in terms of how these technologies will develop, how they will be used, and how the public comes to view them. For now, the traction AnyVision has had, even despite the controversy and ethical questions, seems to have swayed SoftBank.
“The visual recognition market is nascent but has large potential in the Western world,” said Anthony Doeh, a partner for SoftBank Investment Advisers, in a statement. “We have witnessed the transformative power of AI, biometrics and edge computing in other categories, and believe AnyVision is uniquely placed to redefine physical environment analytics across numerous industries.”
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TravelPerk buys UK-based Click Travel in latest pandemic purchase
Business trip booking platform TravelPerk has bagged another rival — picking up UK-based Click Travel. Terms of the deal are not being disclosed but we’re told it’s the third — and largest — acquisition for TravelPerk to date.
The Barcelona-based startup has been on a bit of a shopping spree since the pandemic crisis hit Europe last year, picking up risk management startup Albatross in summer 2020 to bolster resilience to COVID-19’s impacts, before going on to acquire US-based NexTravel in January to expand its presence in the US market.
The latest acquisition deepens TravelPerk’s UK and European business, adding Click Travel’s 2,000+ SME clients (which includes the likes of Five Guys, Red Bull and Talk Talk) to its customer base — which will total just over 5,000 post-acquisition.
The UK company handles some £300M in business travel for its client base, which will bolster TravelPerk’s revenues going forward. The latter now bills itself as the “leading” travel management platform for the SME market globally and the UK as a whole.
“We are a global travel management platform but our core markets are the US and Europe and we expect both markets to be our primary growth areas this year,” said CEO and co-founder Avi Meir. “At the current moment, the US is our largest market due to the covid restrictions in the EU & UK.”
“Assuming travel restrictions won’t be imposed again, we expect to grow by 200% in 2022 with strong growth in our core markets in the US & EU,” he added.
Click Travel, which is based in Birmingham, was founded all the way back in 1999 — and appears to have raised relatively little venture capital over the years, per Crunchbase. However, in 2018, the veteran player participated in the government-backed Future Fifty scale-up program — and also took in a “multi-million pound” investment from the UK-based Business Growth Fund.
Whether there will be any domestic hang-wringing over a high growth UK business being sold to a European rival remains to be seen.
In a statement on its sale to TravelPerk, CEO James McLean omitted to mention the pandemic’s impact on the travel sector — choosing instead to highlight what he couched as the pair’s shared “mission” to reduce the cost and complexity of business travel.
“Those shared objectives, combined with the natural cultural fit between our two companies, means we are incredibly excited to bring our teams together. Combining TravelPerk’s industry-leading knowledge, technology, experience and first class customer support with our own is a powerful proposition and we can’t wait to get started,” McLean added.
While Click Travel has focused on serving the UK market, TravelPerk has had a global focus from the start.
It has also attracted a large amount of external investment (totalling just under $300M) over its shorter run (founded in 2015).
Back in April, for example, it raised a $160M Series D round. It had also topped up its Series C round in July 2019 before the pandemic hit. So TravelPerk hasn’t been short of funds to ride out the COVID-19 revenue crunch — and as well as shopping for competitors it has also been able to avoid making any layoffs over the travel crisis.
Per a press release, capital to fund the Click Travel acquisition was provided by Boston-based investment manager, The Baupost Group.
TravelPerk’s Meir remains bullish about the near-term prospects for growth in the business travel sector, despite ongoing concerns in Europe and the US about the more infectious ‘Delta’ variant of the virus which is contributing to surging rates of COVID-19 in some markets (including the UK) — claiming it’s already seeing green shoots of recovery in “key markets”.
“TravelPerk is outgrowing the market pace and is already at above 2019 revenue figures,” Meir told TechCrunch. “When it comes to the rest of the industry, the recovery of travel is well underway but moving at different speeds in different markets. For instance in the US, according to TSA Checkpoint figures, at the current rate of recovery the US travel market is expected to reach pre-pandemic volume at the end of August 2021.
“We anticipate the global market may take a little longer but are optimistic we will see close to pre-pandemic levels in 2022.”
“We’re one of the few players in the travel industry that continued scaling and growing since the beginning of the pandemic with a strategy that didn’t involve any layoffs,” he also told us. “Since March last year, our strategy has been not to sit back but to be aggressive and invest massively in our product offering and in our global reach, so that we are in the best position possible to capitalise when travel makes its full recovery. Today’s news is a major part of that plan.
“We will aim to continue being aggressive in our growth strategy and we are open to more acquisitions if they make strategic sense and are aligned with our vision and culture.”
Per Meir, Click Travel and TravelPerk will initially continue to run as two independent platforms but he confirmed that an “eventual full integration” is planned — with both set to operate under the TravelPerk brand in time.
The startup also says it will retain all Click Travel’s staff — denying it has plans to axe any jobs. It also intends to hold onto the company’s Birmingham base — having the city as another UK hub for its business (in addition to its existing London office).
“The 150 amazing people working for Click Travel were a big reason why we wanted to acquire the company, and were priced into the deal,” said Meir. “We have no plans of redundancies. We rather aim to integrate the entire team into the TravelPerk Group.”
Asked if TravelPerk might consider expanding its focus to also target the enterprise segment, he noted that it’s seen interest from larger businesses — and said he’s “open” to the idea — but for now Meir said TravelPerk remains fully focused on the SME market: “where we think there is the biggest need, and the biggest growth potential”.
“That’s why this acquisition is so exciting for us; it makes us undoubtedly the leading travel management platform for SMEs globally,” he added.
Flexibility and sustainability
Discussing how the pandemic has changed business travel, Meir highlighted two “important trends” he said TravelPerk will continue to invest it: Namely flexibility for bookings; and sustainability so environmental impact can be reduced.
TravelPerk plans to invest more than $100M in two key products in these areas (aka: FlexiPerk and GreenPerk), per Meir.
“We’ve noticed on our platform that travellers are booking closer to their departure date: Before the pandemic, trip searches were usually conducted between 7 and 30 days prior to the selected departure date,” he said, elaborating on the importance of flexibility for the sector. “Now we are seeing most trip searches are for trips less than 6 days away. Flexibility is therefore one of the most in-demand perks in business travel. Travellers will rely on flexible fares to give them the peace of mind that they won’t lose money if they need to change or cancel a trip on short notice.”
On sustainability, Meir said businesses are already looking for ways to reduce their carbon footprint and general environmental impact, while consumers are also wanting to make conscientious decisions to reduce carbon emission — suggesting that train-based travel is set to gain ground (vs flights) as a result. (That might, ultimately, require some creative retooling of TravelPerk’s logo — which prominently features an airplane icon… )
“We expect to see significant interest in our carbon offsetting product, GreenPerk, as a result but we also expect to see changes in how people are choosing to travel,” he said.
“For instance, rail is undoubtedly the more environmentally-friendly travel option. In fact, taking a train over a domestic flight can reduce an individual’s carbon emissions by about 84%. We have been building out our rail inventory for a number of years now and we expect train travel to be an increasingly popular business travel option for customers this year and next.”
As for the changing mix of business-related travel in a pandemic-reconfigured world of remote work, Meir continues to argue that more businesses providing employees with remote working options will sum to more business travel overall.
“This might be bad news for the daily commute but it will result in more business travel,” he suggested. “Whether they are going fully remote and ‘working from anywhere’, or operating on a hybrid model, distributed teams will need (and want) to come together. We believe there will be a new type of business trip — one where team members will travel from different working hubs to get together for teambuilding and brainstorming sessions, for meetings with clients and colleagues, and even for ‘bleisure’ (business and leisure) trips.”
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Pleo raises $150M at a $1.7B valuation for its new approach to managing expenses for SMBs
Whether you are part of the accounting department, or just any employee at an organization, managing expenses can be a time-consuming and error-filled, yet also quite mundane, part of your job. Today, a startup called Pleo — which has built a platform that can help some of that work more smoothly, by way of a vertically integrated system that includes payment cards, expense management software, and integrated reimbursement and pay-out services — is announcing a big round of growth funding to expand its business after seeing strong traction.
The Copenhagen-based startup has raised $150 million — money that it will be using to continue building out more features for its users, and for business development. The round, which sets a record for being the largest Series C for a Danish startup, values Pleo at $1.7 billion, the startup has confirmed.
There are around 17,000 small and medium businesses now using Pleo, with companies at the medium end of that numbering around 1,000 employees. Now with Pleo moving into slightly larger customers (up to 5,000 employees, CEO Jeppe Rindom, said), the startup has set an ambitious target of reaching 1 million users by 2025, a very lucrative goal, considering that expenses management is estimated to be a $80 billion market in Europe (with the global opportunity, of course, even bigger).
It will also be using the funds simply to expand its business. Pleo has around 330 employees today spread across London, Stockholm, Berlin and Madrid, as well as in Copenhagen, and it will be using some of the investment to grow that team and its reach.
Bain Capital Ventures and Thrive Capital co-led this round, a Series C. Previous backers, including Creandum, Kinnevik, Founders, Stripes and Seedcamp, also participated. Stripes led the startup’s Series B in 2019. It looks like this round was oversubscribed: the original intention had been to raise just $100 million.
Like other business processes, managing expenses and handling company spending has come a long way in the last many years.
Gone are the days where expenses inevitably involved collecting paper receipts and inputting them manually into a system in order to be reimbursed; now, expense management software links up with company-issued cards and taps into a range of automation tools to cut out some of the steps in the process, integrating with a company’s internal accounting policies to shuffle the process along a little less painfully. And there are a number of companies in this space, from older players like SAP’s Concur through to startups on the cusp of going public like Expensify as well as younger entrants bringing new technology into the process.
But, there is still lots more room for improvement. Rindom, Pleo’s CEO who co-founded the company with CTO Niccolo Perra, said the pair came up with the idea for Pleo on the back of years of working in fintech — both were early employees at the B2B supply chain startup Tradeshift — and seeing first-hand how short-changed, so to speak, small and medium businesses in particular were when it came to tools to handle their expenses.
Pleo’s approach has been to build, from the ground up, a system for those smaller businesses that integrate all the different stages of how an employee might spend money on behalf of the company.
Pleo starts with physical and virtual payment cards (which can be used in, for example, Apple Wallet) that are issued by Pleo (in partnership with MasterCard) to buy goods and services, which in turn are automatically itemized according to a company’s internal accounting systems, with the ability to work with e-receipts, but also let people use their phones to snap pictures of receipts when they are only on paper, if required. This is pretty much table stakes for expense software these days, but Pleo’s platform is going a couple of steps beyond that.
Users (or employers) can integrate a users’ own banking details to make it easier to get reimbursed when they have had to pay for something out of their own pocket; or conversely to pay for something that shouldn’t have been charged on the card. And if there are invoices to be paid at a later date from the time of purchase, these too can be actioned and set up within Pleo rather than having to liaise separately with an accounts payable department to get those settled. Higher priced tiers (beyond the basic service for up to five users) also lets a company set spending limits for individual users. Pricing is based on number of users, per month.
Pleo also has built fraud protection services into the platform to detect, for example, cases when a card number might have been compromised and is being used for non-work purposes.
What’s notable is that the startup has built all of the tech that it uses, including the payments feature, from the ground up, to have full control over the features and specifically to be able to add more of them more flexibly over time.
“In the beginning we ran with a partner in services like payments, but it didn’t allow us to move fast enough,” Rindom said in an interview. “So we decided to take all of that in-house.”
It seems like this opens the door to a lot of possibilities for how Pleo might evolve in the years ahead now that it’s focused on hyper-growth. However, Rindom added that whatever the next steps might be, they will remain focused on continuing to solve the expenses problem.
“When it comes to our infrastructure we use it only for ourselves,” he said. “We have no plans of selling [for example, payments] as a service, even if we do have a lot of other ideas for broadening our offerings.” Indeed, the ability to pay invoices was launched only in April of this year. “We come up with things all the time, but will launch only those relevant to customers.” For now, at least.
That focus and perhaps even more than that the execution and customer traction are what have brought investors around to backing a fintech out of Copenhagen.
“The future of work empowers employees with the tools they need to be effective, productive, and successful,” said Keri Gohman, a partner at Bain Capital Ventures, in a statement. “Pleo understands this critical shift for modern companies toward employee centricity—providing workers with a fun-to-use spend management app that automatically tracks their corporate spending and generates expense reports, paired with the powerful tools businesses need to create full visibility and management of every penny spent.”
Bain has been a pretty active investor in European fintech, also backing GoCardless in its recent round. “BCV invests in founders who aren’t afraid to tackle big problems, and Jeppe and Nicco saw a big challenge that employers faced—tracking all corporate spending and reconciling expenses back to the general ledger—and solved it with elegant technology that both employers and employees love,” added Merritt Hummer, a partner at Bain Capital Ventures.
Thrive is also a notable backer here, and it will be interesting to see how and if Pleo links up with others in the VC’s portfolio, which include companies like Plaid, Gong and Trade Republic.
“Pleo has already transformed the way that over 17,000 companies think about managing their expenses, saving them time and lowering costs while increasing transparency,” noted Kareem Zaki, a general partner at Thrive Capital, in a statement. “We are excited to partner closely with the Pleo team to help drive their next phase of growth.”
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ManoMano raises $355 million for its home improvement e-commerce platform
French startup ManoMano has raised a Series F funding round of $355 million led by Dragoneer Investment Group. The company operates an e-commerce platform focused on DIY, home improvement and gardening products. It is currently available in six European countries. Following today’s funding round, the company has reached a valuation of $2.6 billion.
In addition to Dragoneer Investment Group, Temasek, General Atlantic, Eurazeo, Bpifrance’s Large Venture fund, Aglaé Ventures, Kismet Holdings and Armat Group are also participating.
“We operate in Europe and we are the industry leader in online sales,” co-founder and co-CEO Philippe de Chanville told me. In France in particular, the company has been profitable for a couple of years already. In 2020 alone, the company’s gross merchandise volume doubled to €1.2 billion ($1.42 billion at today’s rate).
So why did the company raise given that it’s already in a strong position to replicate the same model in other European markets? Because they could and because they didn’t need to. With a high valuation, ManoMano could raise quite a bit of money without having to sell a significant chunk of its equity.
In addition to France, the startup operates in Spain, Italy, Belgium, Germany and the U.K. With today’s funding round, the company wants to develop its activities in the U.K. and Germany in particular — they are Europe’s two biggest markets for home improvement and gardening.
ManoMano sells products to hobbyists and also targets the B2B market with ManoManoPro. It’s already working well in France with very small teams (1 to 5 employees) and the company is expanding this offering to Spain and Italy.
The startup will also invest more heavily in its product and build a better logistics infrastructure. “For the logistics part, we work with third-party logistics companies — we are a tech company,” co-founder and co-CEO Christian Raisson told me.
ManoMano doesn’t have its own warehouses and doesn’t own any inventory. That’s why ManoMano plans to recruit 1,000 people over the next 18 months and most of them will be tech profiles.
While ManoMano has 7 million clients, sales of home improvement and gardening items still mostly happen in brick-and-mortar stores. The startup is well aware that it’s not just a matter of having the best products at good price points.
ManoMano works with advisors (or Manodvisors) so that experts can give advice whenever customers need some tips. Overall, customers have initiated 2.3 million conversations with advisors in 2020. Recommendations and advice will be key to gain market shares. And the company is now well capitalized to innovate on this front and differentiate itself from other e-commerce platforms.
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