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Tropic picks up $25M to streamline software procurement experiences
The pandemic was a catalyst for showing companies looking to cut costs just how much they were spending on their software tools. New York-based Tropic’s platform not only uncovers those savings, but also brings a click-and-approve approach to buying software. Today, the company announced a $25 million Series A round of funding.
Canaan Partners led the round, with participation from Founder Collective and Mo Koyfman’s new fund, Shine. It gives Tropic $27.1 million in total funding since the company emerged from stealth in 2020, CEO David Campbell told TechCrunch.
Prior to founding the company with Justin Etkin, Campbell was in technology and sales roles, selling software contracts of every size, and realized how complex and rigid the contracts were getting as companies grew larger and the lack of price transparency increased. The complexity of some contracts can cause companies to overpay, even locking companies into payments they can’t afford, Campbell said.
On top of that, more buyers are younger now and their experience with purchasing software is pulling out their phone to download an app, while buying a customer relationship management tool will take six months to buy and cost thousands of dollars.
“Looking at the space, we are in a mirror maze of software, including companies using software to build products that they then sell back to the software companies,” Campbell said. “Companies are only buying software once a year, yet the process can be so complex.”
Tropic’s SaaS procurement model gathers the whole process under one platform. Unlike some competitors’ approaches, it takes on the heavy lifting so when companies have to buy or renew a contract, users can access Tropic’s one-click purchasing service to outsource the transaction. After the contracts are signed, its platform manages the technology and ensures financing is in order. This approach saves companies 23%, on average, on the software purchases, which Campbell said “moves the needle” for many companies where software is the No. 1 cost after salary.
In recent years, cloud software has become a fast-growing spend category across most businesses. Campbell said the average company can have more than 100 software contracts, while that jumps to over 500 for enterprise organizations. Meanwhile, global spend on enterprise software is forecasted to reach $599 billion by the end of 2021, a 13.2% increase over the previous year, according to Statista.
In the last 12 months, the company added over 60 customers, counting Qualtrics, Vimeo, Zapier and Intercom, surpassed $250 million in managed spend and processed transactions for over 1,200 vendors. The company is seeing 100% quarter over quarter growth, and in the last quarter, doubled its annual recurring revenue, Campbell said.
Tropic will use the funding for R & D and to deepen integrations with existing procurement tools in the cloud software ecosystem. Over the past year, the company’s headcount has grown to 50 and Campbell has “aggressive hiring plans between now and the rest of the year” focused on the tech side with engineering and product management.
Hootan Rashidifard, principal from Canaan Partners, said his firm was tracking the software procurement sector and learned about Tropic through Founder Collective, which led the company’s seed round.
“We’re seeing software and financial services converge and Tropic sits squarely at the intersection of both in a category with massive tailwinds,” Rashidifard said via email. “Software is accelerating the share of expenses while also penetrating every part of an organization, and software purchasing is becoming more decentralized. Tropic’s platform is in a fragmented market with high payment volume, which is ripe for layering on all kinds of adjacent services.”
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PairTree speeds adoption process with an online, self-matching platform and $2.25M seed
Making the choice to adopt, or to find an adopting family, is a legally complex, emotionally taxing, expensive and time-consuming process. PairTree aims to make one part at least considerably easier and faster with its online matching platform where expectant mothers and hopeful adopters can find each other without the facilitation of an agency or other organization. The company has just raised a $2.25 million seed round, a rarity in the industry.
The path to adoption is different for everyone, but there are generally some things they have in common: Once the process is started, it can take upwards of $50,000 and over a year-and-a-half to organize a match. While some of this comprises the ordinary legal hurdles involved in any adoption, a big part of it is simply that there are limited opportunities for adoption, and compatibility isn’t guaranteed. As many people considering adoption are doing so on the heels of unsuccessful fertility treatment, it can be a lot to take on and a dispiriting wait.
Erin Quick, CEO and co-founder (with CTO Justin Friberg) of PairTree, said that the modern adoption landscape is marked by the fact that nearly 95 percent of adoptions are open, meaning there is ongoing contact between a biological mother and adopting family.
“They’ll be working together forever, and that makes finding a highly compatible match that much more important,” Quick, herself a happy adopter, told TechCrunch in an interview. But because of the way adoption is generally done — through agencies licensed by states — there are limitations on how far anyone involved can reach.
“It’s so bound by geography,” she said. “It’s regulated at the state level and has been facilitated by state level, not because of state laws — there’s no rule saying you can’t adopt out of state — but because the facilitators are small nonprofits. They bind themselves to their geographic region because that’s what they can serve. We’re building a platform that makes what people are already doing much easier and more efficient.”
That platform is in many ways very much like a dating app, though of course the comparison is not exact and does not reflect the gravity of choosing to adopt. But like in the dating world, in adoption you have a cloud of people looking to connect over something highly dependent on personality and individual needs.
Screenshot of the way expectant mothers can filter and search for compatible adopting families.
PairTree onboards both expectant mothers and adopters with personality tests — not the light-hearted stuff of OkCupid but a broader, more consequential set of Jungian archetypes that signal a person’s high-level priorities in life. Think “wants to travel and learn” versus “wants to provide and nurture” (not that these are necessarily incompatible) — they serve as important indicators of preferences that might not be so easily summarized with a series of checkboxes. That’s not the only criterion, of course. Other demographic and personal details are also collected.
The adopters are added to a pool through which expectant mothers can sift and, if desired, contact (in this, Quick suggested, PairTree mirrors Bumble, where women must message first). PairTree also does basic due diligence stuff like identify verification and confirmation of other important steps like home studies.
If a likely match is found, all the relevant information is passed to the adoption facilitator, who will be coordinating the other legal and financial steps. PairTree isn’t looking to replace these agencies — in fact Quick said that they have been huge proponents of the platform, since it can shorten wait times and improve outcomes. She said based on their existing successful adoptions that the wait can be cut by half or even two-thirds, and thus the cost (which involves recurring payments as the agency searches and does the legal work) by a similar amount.
“These are small nonprofits; they don’t have a lot of tech chops. When we launched we went to attorneys first, actually, and we were surprised when agencies started reaching out,” she explained.
Agencies have been referring their adopters to PairTree, which has led to a lot of early traction, Quick said. And importantly, they’ve seen great diversity in their early success.
“Adoption has historically been denied by faith-based systems — LGBTQ families and single women have been subject to discrimination,” she noted. And in fact just last week a Supreme Court decision held up the right of religious adoption agencies to deny services to same-sex couples. Quick was proud to say that they have already facilitated adoptions by same-sex couples and single parents.
The company will also set aside 5 percent of its net profits, which hopefully will manifest in volume, for the Lifetime Healing Foundation, which offers counseling and support to birth mothers who have gone though the adoption process.
The $2.25 million seed round was led by Urban Innovation Fund, with Founder Collective, Female Founders Alliance and Techstars participating. It will surprise few to hear that adoption is not a particularly hot industry for venture capital, but rising interest and investment in fertility tech may have shed light on opportunities in adjacent spaces. Adoption is one where significant improvements can be enabled by technology, meaning startups can grow fast while having a positive impact.
The company plans to use the money to expand its product portfolio, pursue more partnerships, and perhaps most importantly for its users, build a native mobile app, since 90 percent of the service’s viewership is mobile.
“We’re grateful to our expert and diverse group of investors who share our vision that adoption should be a viable path to parenting for more people,” said Quick in the release announcing the raise. “Like us, our investors believe in the importance of supporting Biological and Adopting Families along with the Adoptees, because adoption is not a single transaction but a journey they’re taking over the course of a lifetime.”
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Zolve raises $15 million for its cross-border neobank aimed at global citizens
Tens of thousands of students and professionals move out of India each year to pursue higher education and for work. Even after spending months in a new country, they struggle to get a credit card from local banks, and end up paying a premium to access a range of other financial services.
Banks in the U.S., or in most other countries for that matter, rely on local credit scores to determine the worthiness of potential applicants. Even if an individual had a great credit score in India, for instance, that wouldn’t hold any water for banks in a foreign land.
That was the takeaway Raghunandan G, the founder of ride-hailing firm TaxiForSure (sold to local giant Ola), returned to India with after a trip. After months of research and assembling a team, Raghunandan believes he has a solution.
On Wednesday, he announced Zolve, a neobanking platform for individuals moving from India to the U.S. (or the other way around).
The startup works with banks in the U.S. and India to provide consumers access to financial products seamlessly — without paying any premium or coughing up any security deposit.
In an interview with TechCrunch, Raghunandan said the startup underwrites the risks, which has enabled banks in foreign countries to extend their services to Zolve customers. “Consumers can open an account with us and access all banking services as if they are banking with their national bank,” he said.
As part of the announcement, Raghunandan said two-month-old Zolve has raised $15 million in a seed financing round led by Accel and Lightspeed. Blume Ventures and several high-profile angel investors, including Kunal Shah (founder of Cred), Ashish Gupta (formerly the MD of Helion), Greg Kidd (known for his investments in Twitter and Ripple), Rahul Mehta (managing partner at DST Global) and Rahul Kishore (senior managing director of Coatue Capital), also participated in the round. So did Founder Collective (which has backed Airtable and Uber), in what is its first investment in an Indian startup.
“Individuals with financial identities in multiple geographies need seamless global financial solutions and we believe the team’s strong identification with the problem will enable them to deliver compelling and innovative financial experiences,” said Bejul Somaia, Lightspeed India Partners, in a statement.
Before starting Zolve, Raghunandan founded TaxiForSure, a ride-hailing firm, that he later sold to Ola for $200 million. Image Credits: Zolve
Raghunandan acknowledged that a handful of other startups are also attempting to solve this challenge, but he said other firms are not making use of a consumer’s credit history from their origin nation. “We are the only one who is looking at this problem in a completely different light. We are not trying to solve the problem at the destination country where consumers face the challenges. We are finding the solution in the home country itself, where the consumers already have a reputation and credit history,” he said.
Once a customer has access to a credit card and other financial services in the new nation, they can quickly broaden their local credit history, something that otherwise takes years, he said.
“The global citizen community is largely underserved in terms of access to financial services and we believe that there is a huge market opportunity for Zolve. Raghu has a proven track record as a founder and we are delighted to partner with him again, on his latest venture. The team’s passion and commitment are commendable and we are positive that Zolve will create tremendous value for this community,” said Anand Daniel, partner at Accel, in a statement.
Headquartered in San Francisco and Bangalore, Zolve offers a range of compelling features even for those who don’t plan to visit a foreign land. If you’re in India, for instance, you can use Zolve to buy shares of companies listed at U.S. exchanges. You can also buy bitcoin and other cryptocurrency from exchanges based in the U.S. or Europe, said Raghunandan.
The startup, which has already amassed more than 5,000 customers, has formed revenue-sharing arrangements with its banking partners. Raghunandan said since Zolve currently onboards customers in India and generates much of its revenue from banking partners in the U.S., it’s already operating on a profitable model.
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Grain, a startup built expressly atop of Zoom for note-taking and video-clip making, raises $4 million
Whenever a platform breaks out, companies emerge to seize on its reach by building their services or products atop it. It happened with Facebook and Twitter and Slack. Now, it’s happening with Zoom, the video conferencing company that took the world by storm earlier this year as the coronavirus sent people around the globe indoors and into self-imposed isolation.
It’s not a brand-new trend. Plenty of companies are selling their wares through the Zoom App Marketplace, which launched in the fall of 2018 and now features 18 pages of providers. But Grain, founded in 2018 in San Francisco, is among the first to build its entire business around it, at least as a starting point.
What is that business? According to co-founder and CEO Mike Adams, the idea is to capture content in Zoom calls that can be saved and shared across platforms, including Twitter, Discord, Notion, Slack and iMessages.
Say a student wants to take notes; he or she can record part of what a teacher is saying to save or share with classmates, without having to rewatch an entire lecture. The same is true in work settings. By using Grain, a colleague can flag the most important bits of information that was conveyed, then share just those bits via a clip that has its own unique URL.
Grain also transcribes content in clips and allows users to turn on closed captions if they choose.
The video clips can range from 30 seconds up to 10 minutes. They can also be strung together into reels to create summary highlights. (These have no time limit.) Not last, users can trim or adjust the length of the highlight after it has been recorded, as well as control who else can edit the video afterward to prevent nefarious actors from manipulating the snippets.
Adams says he and his brother, Jake — a former software engineer at Branch Metrics with whom he co-founded the company — are even using Grain to save snippets of precious moments on Zoom involving nieces and nephews, though the focus is very much on the companies and schools that will pay on a per-seat basis for the software.
Indeed, Adams says the idea for Grain was really born at the last company he co-founded: MissionU, a Zoom-based one-year alternative to a traditional college whose students weren’t asked for tuition but instead agreed to hand over up to 15% of their incomes for three years once they landed a job that paid $50,000 or more.
MissionU — which was founded in 2016 and raised $11.5 million from investors — sold to WeWork in 2018 in a stock deal before its students earned anything (they were released from their income-sharing agreements). Still, the experiment was long enough that Adams, who left MissionU at the time of the sale, says he saw firsthand the need for better tools to help students capture what’s important in their online content.
The question, of course, is whether Zoom also sees the opportunity. Relying so heavily on another company is always a risk. (See Facebook and Twitter and the long list of third-party developers that have been burned by both companies.)
If Zoom, which is starting to make venture-like bets, were an investor in Grain, it might help inoculate it from potential competition down the road.
Still, that it isn’t didn’t dissuade other investors who are betting that Zoom will prove friend and not foe. In fact, late last year, Grain raised $4 million over two seed rounds from a long list of notable investors, including Acrew Capital, Founder Collective, Peterson Partners, Slack Fund, Scott Belsky, Sriram Krishnan, Andreas Klinger, Scooter Braun and others.
Now its 11-person team is ready to take the wraps off what they’ve been building in beta with some of that capital.
Certainly, Grain — which plans to eventually integrate with numerous other companies — could do worse as springboards go than Zoom, one of the rare new breakout platform companies in memory and a tool that, early this week, Oracle co-founder Larry Ellison called an “essential service” that will change how work is done.
Zoom has long been powered by viral end user adoption, enjoying growth internally and externally because of the nature of video conferencing across companies. Now, its pick-up as a consumer company is following a similar trajectory, with a high percentage of new users who are invited to Zoom calls eventually signing up for the service so that they can themselves host a call.
If Grain gets lucky, some percentage of that percentage will also discover Grain.
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Despite winter’s chill, the Northeast’s tech ecosystem is white-hot
Hello and welcome back to our regular morning look at private companies, public markets and the grey space in between.
Today, we’re digging into a host of data concerning the East Coast venture capital scene, specifically looking into the performance of its two key startup markets.
It’s 12 degrees Fahrenheit as I write this in my office situated between Boston and New York City — a perfect vantage point for studying these vibrant tech ecosystems. Let’s see what the data tells us.
The information we’re examining today comes from White Star Capital (often via CBInsights), a venture capital firm that describes itself as “transatlantic” and takes part in seed, Series A and Series B rounds around the globe. The group last raised a $180 million fund that TechCrunch covered here, noting at the time that capital pool was “oversubscribed from an initial target of $140 million” and would be invested into “around 20 new companies from the new fund, writing opening cheques of between $1 million and $6 million.”
With boots on the ground in New York, White Star cares about the East Coast, so the fund’s put dossier on the region isn’t unexpected. What it includes, however, is.
We’ll start with NYC and its surprising 2019 before turning to Boston, digging into its super-giant venture totals and hearing from Founder Collective’s Eric Paley on the state of things in urban Massachusetts.
New York City
White Star’s report details record-breaking figures for NYC’s current year. Off of effectively flat deal volume (New York City sees around 775 venture deals per year at the moment, or a little more than two per day), the overgrown town should set record venture dollar volume in 2019.
Observe the following, astounding chart detailing the abnormality of 2019 from a comparative venture dollar perspective:
By smashing 2017’s local maximum, 2019 appears set to crush the city’s record — and rich — venture investment totals. The graphic also manages to point out (somewhat embarrassingly) that Gotham will manage to best a number of European countries’ aggregate venture dollar investments by itself this year.
That’s is a useful bit of context as in the United States, New York City is always Number Two to Silicon Valley. But, this chart argues, being number two in the number-one market is still a hell of a lot of capital.
Putting New York City’s venture into even sharper comparative perspective, observe the following table:
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No one knows how effective digital therapies are, but a new tool from Elektra Labs aims to change that
Depending on which study you believe, the wearable and digital health market could be worth anywhere from $30 billion to nearly $90 billion in the next six years.
If the numbers around the size of the market are a moving target, just think about how to gauge the validity and efficacy of the products that are behind all of those billions of dollars in spending.
Andy Coravos, the co-founder of Elektra Labs, certainly has.
Coravos, whose parents were a dentist and a nurse practitioner, has been thinking about healthcare for a long time. After a stint in private equity and consulting, she took a coding bootcamp and returned to the world she was raised in by taking an internship with the digital therapeutics company Akili Interactive.
Coravos always thought she wanted to be in healthcare, but there was one thing holding her back, she says. “I’m really bad with blood.”
That’s why digital therapeutics made sense. The stint at Akili led to a position at the U.S. Food and Drug Administration as an entrepreneur in residence, which led to the creation of Elektra Labs roughly two years ago.
Now the company is launching Atlas, which aims to catalog the biometric monitoring technologies that are flooding the consumer health market.
These monitoring technologies, and the applications layered on top of them, have profound implications for consumer health, but there’s been no single place to gauge how effective they are, or whether the suggestions they’re making about how their tools can be used are even valid. Atlas and Elektra are out to change that.
The FDA has been accelerating its clearances for software-driven products like the atrial fibrillation detection algorithm on the Apple Watch and the ActiGraph activity monitors. And big pharma companies like Roche, Pfizer and Novartis have been investing in these technologies to collect digital biomarker data and improve clinical trials.
Connected technologies could provide better care, but the technologies aren’t without risks. Specifically, the accuracy of data and the potential for bias inherent in algorithms that were created using flawed data sets mean there’s a lot of oversight that still needs to be done, and consumers and pharmaceutical companies need to have a source of easily accessible data about the industry.
”The increase in FDA clearances for digital health products coupled with heavy investment in technology has led to accelerated adoption of connected tools in both clinical trials and routine care. However, this adoption has not come without controversy,” said Coravos in a statement. “During my time as an Entrepreneur in Residence in the FDA’s Digital Health Unit, it became clear to me that like pharmacies which review, prepare, and dispense drug components, our healthcare system needs infrastructure to review, prepare, and dispense connected technologies components.”
The analogy to a pharmacy isn’t an exact fit, because Elektra Labs currently doesn’t prepare or dispense any of the treatments that it reviews. But Atlas is clearly the first pillar that the digital therapeutics industry needs as it looks to supplant pharmaceuticals as treatments for some of the largest and most expensive chronic conditions (like diabetes).
Courtesy of Andrea Coravos/Elektra Labs
Coravos and here team interviewed more than 300 professionals as they built the Atlas toolkit for pharmaceutical companies and other healthcare stakeholders seeking a one-stop shop for all their digital healthcare data needs. Like a drug label, or nutrition label, Atlas publishes labels that highlight issues around the usability, validation, utility, security and data governance of a product.
In an article in Quartz earlier this year, Coravos made her pitch for Elektra Labs and the types of things it would monitor for the nascent digital therapeutics industry. It includes the ability to handle adverse events involving digital therapies by providing a single source where problems could be reported; a basic description for consumers of how the products work; an assessment of who should actually receive digital therapies, based on the assessment of how well certain digital products perform with certain users; a description of a digital therapy’s provenance and how it was developed; a database of the potential risks associated with the product; and a record of the product’s security and privacy features.
As the projections on market size show, the problem isn’t going to get any smaller. As Google’s recent acquisition bid for Fitbit and the company’s reported partnership with Ascension on “Project Nightingale” to collect and digitize more patient data shows, the intersection of technology and healthcare is a huge opportunity for technology companies.
“Google is investing more. Apple is investing more… More and more of these devices are getting FDA cleared and they’re becoming not just wellness tools but healthcare tools,” says Coravos of the explosion of digital devices pitching potential health and wellness benefits.
Elektra Labs is already working with undisclosed pharmaceutical companies to map out the digital therapeutic environment and identify companies that might be appropriate partners for clinical trials or acquisition targets in the digital market.
“The FDA is thinking about these digital technologies, but there were a lot of gaps,” says Coravos. And those gaps are what Elektra Labs is designed to fill.
At its core, the company is developing a catalog of the digital biomarkers that modern sensing technologies can track and how effective different products are at providing those measurements. The company is also on the lookout for peer-reviewed published research or any clinical trial data about how effective various digital products are.
Backing Coravos and her vision for the digital pharmacy of the future are venture capital investors, including Maverick Ventures, Arkitekt Ventures, Boost VC, Founder Collective, Lux Capital, SV Angel and Village Global.
Alongside several angel investors, including the founders and chief executives from companies including: PillPack, Flatiron Health, National Vision, Shippo, Revel and Verge Genomics, the venture investors pitched in for a total of $2.9 million in seed funding for Coravos’ latest venture.
“Timing seems right for what Elektra is building,” wrote Brandon Reeves, an investor at Lux Capital, which was one of the first institutional investors in the company. “We have seen the zeitgeist around privacy data in applications on mobile phones and now starting to have the convo in the public domain about our most sensitive data (health).”
If the validation of efficacy is one key tenet of the Atlas platform, then security is the other big emphasis of the company’s digital therapeutic assessment. Indeed, Coravos believes that the two go hand-in-hand. As privacy issues proliferate across the internet, Coravos believes that the same troubles are exponentially compounded by internet-connected devices that are monitoring the most sensitive information that a person has — their own health records.
In an article for Wired, Koravos wrote:
Our healthcare system has strong protections for patients’ biospecimens, like blood or genomic data, but what about our digital specimens? Due to an increase in biometric surveillance from digital tools—which can recognize our face, gait, speech, and behavioral patterns—data rights and governance become critical. Terms of service that gain user consent one time, upon sign-up, are no longer sufficient. We need better social contracts that have informed consent baked into the products themselves and can be adjusted as user preferences change over time.
We need to ensure that the industry has strong ethical underpinning as it brings these monitoring and surveillance tools into the mainstream. Inspired by the Hippocratic Oath—a symbolic promise to provide care in the best interest of patients—a number of security researchers have drafted a new version for Connected Medical Devices.
With more effective regulations, increased commercial activity, and strong governance, software-driven medical products are poised to change healthcare delivery. At this rate, apps and algorithms have the opportunity to augment doctors and complement—or even replace—drugs sooner than we think.
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Ethyca raises $4.2M to simplify GDPR compliance
GDPR, the European data privacy regulations, have been in effect for more than a year, but it’s still a challenge for companies to comply. Ethyca, a New York City startup, has created a solution from the ground up to help customers adhere to the regulations, and today it announced a $4.2 million investment led by IA Ventures and Founder Collective.
Table Management, Sinai Ventures, Cheddar founder Jon Steinberg and Moat co-founder Jonah Goodhart also participated.
At its heart, Ethyca is a data platform that helps companies discover sensitive data, then provides a mechanism for customers to see, edit or delete their data from the system. Finally, the solution enables companies to define who can see particular types of data across the organization to control access. All of these components are designed to help companies comply with GDPR regulations.
Ethyca enterprise transaction log (Screenshot: Ethyca)
Company co-founder Cillian Kieran says that the automation component is key and should greatly reduce the complexity and cost associated with complying with GDPR rules. From his perspective, current solutions that involve either expensive consultants or solutions that require some manual intervention don’t get companies all the way there.
“These solutions don’t actually solve the issue from an infrastructure point of view. I think that’s the distinction. You can go and use the consultants, or you can use a control panel that tells you what you need to do. But ultimately, at some point you’re either going to have to build or deploy code that fixes some issues, or indeed manually manage or remediate those [issues]. Ethyca is designed for that and takes away those risks because it is managing privacy by design at the infrastructure level,” Kieran explained.
If you’re worried about the privacy of providing information like this to a third-party vendor, Kieran says that his company never actually sees the raw data. “We are a suite of tools that sits between business processes. We don’t capture raw data, We don’t see personal information. We find information based on unique identifiers,” he said.
The company has been around for more than a year, but has been spending its first year developing the solution. He sees this investment as validation of the problem his startup is trying to solve. “I think the investment represents the growing awareness fundamentally from both with the investor community, and also in the tech world, that data privacy as a regulatory constraint is real and will compound itself,” he said.
He also points out that GDPR is really just the tip of the privacy regulation iceberg, with laws in Australia, Brazil and Japan, as well as California and other states in the U.S. due to come online next year. He says his solution has been designed to deal with a variety of privacy frameworks beyond GDPR. If that’s so, his company could be in a good position moving forward.
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CREXi raises $11 million to bring commercial real estate out of the Dark Ages
Managing, buying and selling commercial real estate is a fairly primitive process. CREXi founder Mike DeGiorgio remembers one experience in 2014 when he was required to fax and mail details about an urgent transaction to the leasing office, a move that made him think he was back in the era of Pogs and MTV’s Real World Season 1.
“There simply was no great industry solution for researching markets, finding comps, transacting, connecting with key stakeholders, purchasing or investing in properties, renting or leasing space, getting a loan, finding partners to purchase properties with, marketing yourself or the properties you own, sell or lease etc.,” he said. “I started thinking about technology solutions for the commercial real estate industry to solve many of these inefficiencies in the CRE space. I could not figure out why it hadn’t been done and set out to build CREXi to help industry stakeholders be more efficient and to make the industry more liquid, transparent and easier to access.”
CREXi — the CRE stands for “commercial real estate” — has been around since 2015, but recently announced an $11 million Series A as well as some interesting user numbers. Key investors include Jackson Square Ventures, Manifest Investment Partners, Lerer Hippeau, Freestyle Capital, TenOneTen Ventures and Founder Collective. The company has managed more than 100,000 “properties brought to market” on its platform and they have 200,000 users per month. They see more than 6,000 properties listed on the site each month.
The service is a suite of tools that streamlines the entire CRE processing.
“We give brokers the ability to find, manage and qualify leads, market their properties with customizable emails, and communicate with interested parties through in-app messaging. Additionally, our features help brokers interact with the industry and its stakeholders; solicit, make, accept, counter and negotiate offers; run competitive bidding processes; run escrow and closing processes; research markets and sold properties etc.,” said DeGiorgio.
While CRE isn’t very sexy, it’s clear that the industry can use all the help it can get. Considering CREXi manages $450 billion in property value, it’s also clear that this is a lucrative market ripe for disruption.
“We are the first platform to take the entire commercial real estate transaction process online with a simple to use and intuitive interface,” said DeGiorgio. “We collaborate with brokers and principals to blend technology with the fundamentals of CRE transactions, addressing the shifting needs of industry professionals to maximize revenue and minimize time spent on administrative tasks.”
Now he just has to get everyone to throw away their postal scales and fax machines and help CRE enter the era of Honey Boo Boo and leave the era of the Olsen Twins.
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