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Investors are doubling down on Southeast Asia’s digital economy
Southeast Asian tech companies are drawing the attention of investors around the world. In 2020, startups in the region raised over $8.2 billion, about four times more than they did in 2015. This trend continued in 2021, with regional M&A hitting a record high of $124.8 billion in the first half of 2021, up 83% from a year earlier.
This begs the question: Who exactly is investing in Southeast Asia?
Let’s explore the three key types of investors pouring money into and driving the growth of Southeast Asia’s tech ecosystem.
Over 229 family offices have been registered in Singapore since 2020, with total assets under management of an estimated $20 billion.
Big tech
Southeast Asia has become an attractive market for U.S. and Chinese tech firms. Internet penetration here stands at 70%, higher than the global average, and digital adoption in the region remains nascent — it wasn’t until the pandemic that adoption of digital services such as e-wallets and online shopping took off.
China’s tech giants Tencent and Alibaba were among the first to support early e-commerce growth in Southeast Asia with investments in Sea Limited and Lazada, and have since expanded their footprint into other internet verticals. Alibaba has backed Akulaku, M-Pay (eMonkey), DANA, Wave Money and Mynt (GCash), while Tencent has invested in Voyager Innovations (PayMaya), SHAREit, iflix, Ookbee and Sanook.
U.S. tech firms have also recently entered the scene. In June 2020, Gojek closed a $3 billion Series F round from Google, Facebook, Tencent and Visa. Google, together with Singapore’s Temasek Holdings, invested some $350 million in Tokopedia in October. Meanwhile, Microsoft invested an undisclosed amount in Grab in 2018 and has invested $100 million in Indonesian e-commerce firm Bukalapak.
Venture capitalists
In Q1 2021, Southeast Asian startups raised $6 billion, according to DealStreetAsia, positioning 2021 as another record year for VC investment in the region.
The region is also rising in prominence as a destination for investment capital relative to the rest of Asia. Regional VC investment grew 5.2 times to $8.2 billion in 2020 from $1.6 billion in 2015, as we can see in the table below.
Image Credits: Jungle VC
Southeast Asia also has many opportunities for VC investment relative to its market size. From 2015 to 2020, China saw VC investment of nearly $300 per person; for Southeast Asia — despite a recent investment boom — this metric sits at just $47.50 per person, or just a sixth of that in China. This implies a substantial opportunity for investments to develop the region’s digital economy.
The region’s rising population and growth prospects are higher due to China’s population growth challenges, alongside the latter’s higher digital economy market saturation and maturity.
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Homebase raises $71M for a team management platform aimed at SMBs and their hourly workers
Small and medium enterprises have become a big opportunity in the world of B2B technology in the last several years, and today a startup that’s building tools aimed at helping them manage their teams of workers is announcing some funding that underscores the state of that market.
Homebase, which provides a platform that helps SMBs manage various services related to their hourly workforces, has closed $71 million in funding, a Series C that values the company between $500 million and $600 million, according to sources close to the startup.
The round has a number of big names in it that are as much a sign of how large VCs are valuing the SMB market right now as it is of the strategic interest of the individuals who are participating. GGV Capital is leading the round, with past backers Bain Capital Ventures, Baseline Ventures, Bedrock, Cowboy Ventures and Khosla Ventures also participating. Individuals include Focus Brands President Kat Cole; Jocelyn Mangan, a board member at Papa John’s and Chownow and former COO of Snag; former CFO of payroll and benefits company Gusto, Mike Dinsdale; Guild Education founder Rachel Carlson; star athletes Jrue and Lauren Holiday; and alright alright alright actor and famous everyman and future political candidate Matthew McConaughey.
Homebase has raised $108 million to date.
The funding is coming on the heels of strong growth for Homebase (which is not to be confused with the U.K./Irish home improvement chain of the same name, nor the YC-backed Vietnamese proptech startup).
The company now has some 100,000 small businesses, with 1 million employees in total, on its platform. Businesses use Homebase to manage all manner of activities related to workers that are paid hourly, including (most recently) payroll, as well as shift scheduling, timeclocks and timesheets, hiring and onboarding, communication and HR compliance.
John Waldmann, Homebase’s founder and CEO, said the funding will go toward both continuing to bring on more customers as well as expanding the list of services offered to them, which could include more features geared to frontline and service workers, as well as features for small businesses who might also have some “desk” workers who might still work hourly.
The common thread, Waldmann said, is not the exact nature of those jobs, but the fact that all of them, partly because of that hourly aspect, have been largely underserved by tech up to now.
“From the beginning, our mission was to help local businesses and their teams,” he said. Part of his inspiration came from people he knew: a childhood friend who owned an independent, expanding restaurant chain, and was going through the challenges of managing his teams there, carrying out most of his work on paper; and his sister, who worked in hospitality, which didn’t look all that different from his restaurant friend’s challenges. She had to call in to see when she was working, writing her hours in a notebook to make sure she got paid accurately.
“There are a lot of tech companies focused on making work easier for folks that sit at computers or desks, but are building tools for these others,” Waldmann said. “In the world of work, the experience just looks different with technology.”
Homebase currently is focused on the North American market — there are some 5 million small businesses in the U.S. alone, and so there is a lot of opportunity there. The huge pressure that many have experienced in the last 16 months of COVID-19 living, leading some to shut down altogether, has also focused them on how to manage and carry out work much more efficiently and in a more organized way, ensuring you know where your staff is and that your staff knows what it should be doing at all times.
What will be interesting is to see what kinds of services Homebase adds to its platform over time: In a way, it’s a sign of how hourly wage workers are becoming a more sophisticated and salient aspect of the workforce, with their own unique demands. Payroll, which is now live in 27 states, also comes with pay advances, opening the door to other kinds of financial services for Homebase, for example.
“Small businesses are the lifeblood of the American economy, with more than 60% of Americans employed by one of our 30 million small businesses. In a post-pandemic world, technology has never been more important to businesses of all sizes, including SMBs,” Jeff Richards, managing partner at GGV Capital and new Homebase board member, said in a statement. “The team at Homebase has worked tirelessly for years to bring technology to SMBs in a way that helps drive increased profitability, better hiring and growth. We’re thrilled to see Homebase playing such an important role in America’s small business recovery and thrilled to be part of the mission going forward.”
It’s interesting to see McConaughey involved in this round, given that he’s most recently made a turn toward politics, with plans to run for governor of Texas in 2022.
“Hardworking people who work in and run restaurants and local businesses are important to all of us,” he said in a statement. “They play an important role in giving our cities a sense of livelihood, identity and community. This is why I’ve invested in Homebase. Homebase brings small business operations into the modern age and helps folks across the country not only continue to work harder, but work smarter.”
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Orca Security raises $210M Series C at a unicorn valuation
Orca Security, an Israeli cybersecurity startup that offers an agent-less security platform for protecting cloud-based assets, today announced that it has raised a $210 million Series C round at a $1.2 billion valuation. The round was led by Alphabet’s independent growth fund CapitalG and Redpoint Ventures. Existing investors GGV Capital, ICONIQ Growth and angel syndicate Silicon Valley CISO Investment also participated. YL Ventures, which led Orca’s seed round and participated in previous rounds, is not participating in this round — and it’s worth noting that the firm recently sold its stake in Axonius after that company reached unicorn status.
If all of this sounds familiar, that may be because Orca only raised its $55 million Series B round in December, after it announced its $20.5 million Series A round in May. That’s a lot of funding rounds in a short amount of time, but something we’ve been seeing more often in the last year or so.
Orca Security co-founders Gil Geron (left) and Avi Shua (right). Image Credits: Orca Security
As Orca co-founder and CEO Avi Shua told me, the company is seeing impressive growth and it — and its investors — want to capitalize on this. The company ended last year beating its own forecast from a few months before, which he noted was already aggressive, by more than 50%. Its current slate of customers includes Robinhood, Databricks, Unity, Live Oak Bank, Lemonade and BeyondTrust.
“We are growing at an unprecedented speed,” Shua said. “We were 20-something people last year. We are now closer to a hundred and we are going to double that by the end of the year. And yes, we’re using this funding to accelerate on every front, from dramatically increasing the product organization to add more capabilities to our platform, for post-breach capabilities, for identity access management and many other areas. And, of course, to increase our go-to-market activities.”
Shua argues that most current cloud security tools don’t really work in this new environment. Many, because they are driven by metadata, can only detect a small fraction of the risks, and agent-based solutions may take months to deploy and still not cover a business’ entire cloud estate. The promise of Orca Security is that it can not only cover a company’s entire range of cloud assets but that it is also able to help security teams prioritize the risks they need to focus on. It does so by using what the company calls its “SideScanning” technology, which allows it to map out a company’s entire cloud environment and file systems.
“Almost all tools are essentially just looking at discrete risk trees and not the forest. The risk is not just about how pickable the lock is, it’s also where the lock resides and what’s inside the box. But most tools just look at the issues themselves and prioritize the most pickable lock, ignoring the business impact and exposure — and we change that.”
It’s no secret that there isn’t a lot of love lost between Orca and some of its competitors. Last year, Palo Alto Networks sent Orca Security a sternly worded letter (PDF) to stop it from comparing the two services. Shua was not amused at the time and decided to fight it. “I completely believe there is space in the markets for many vendors, and they’ve created a lot of great products. But I think the thing that simply cannot be overlooked, is a large company that simply tries to silence competition. This is something that I believe is counterproductive to the industry. It tries to harm competition, it’s illegal, it’s unconstitutional. You can’t use lawyers to take your competitors out of the media.”
Currently, though, it doesn’t look like Orca needs to worry too much about the competition. As GGV Capital managing partner Glenn Solomon told me, as the company continues to grow and bring in new customers — and learn from the data it pulls in from them — it is also able to improve its technology.
“Because of the novel technology that Avi and [Orca Security co-founder and CPO] Gil [Geron] have developed — and that Orca is now based on — they see so much. They’re just discovering more and more ways and have more and more plans to continue to expand the value that Orca is going to provide to customers. They sit in a very good spot to be able to continue to leverage information that they have and help DevOps teams and security teams really execute on good hygiene in every imaginable way going forward. I’m super excited about that future.”
As for this funding round, Shua noted that he found CapitalG to be a “huge believer” in this space and an investor that is looking to invest into the company for the long run (and not just trying to make a quick buck). The fact that CapitalG is associated with Alphabet was obviously also a draw.
“Being associated with Alphabet, which is one of the three major cloud providers, allowed us to strengthen the relationship, which is definitely a benefit for Orca,” he said. “During the evaluation, they essentially put Orca in front of the security leadership at Google. Definitely, they’ve done their own very deep due diligence as part of that.”
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Proving voicemail doesn’t have to be wack, the Slack-backed startup Yac raises $7.5 million
Yac, the Orlando, Florida-based startup that’s digitizing voice messages for remote offices, has raised $7.5 million in a new round of funding.
The company’s service has garnered enough attention to pick up a pretty sizable new round from investors led by GGV Capital and a return investment from the Slack Fund.
Apparently, reinventing voicemail is a multi-million-dollar endeavor.
“The future of meetings will be asynchronous, in your ears and hands-free,” says Pat Matthews, the chief executive and founder of Active Capital, when the company announced its seed round nearly a year ago.
Co-founded by Justin Mitchell, Hunter McKinley and Jordan Walker, Yac was spun out of the digital agency SoFriendly, and was developed as a pitch for Product Hunt’s Maker Festival. The voice messaging service won that startup competition at the event and attracted the interest of Boost VC and its founder, the third-generation venture capitalist Adam Draper.
About six months after that seed round, Yac received outreach from Slack thanks to a referral from another entrepreneur. Throughout their negotiations last year, the teams used Yac to conduct due diligence, according to Mitchell. At the time of the company’s August announcement that Slack had come on to finance the company, Yac had a bit over 5,000 users on its service; it charges per seat, in the same way Slack does.
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Fairmarkit lands $30M Series B to modernize procurement
As the pandemic has raged on, it has shone a spotlight on the importance of procurement, especially in certain sectors. Fairmarkit, a Boston startup, is working to bring a modern digital procurement system to the enterprise. Today, the company announced a $30 million Series B.
GGV Capital and Insight Partners led the round with help from existing investors 1984 VC, NewStack and NewFund. Today’s investment brings the total raised to $42 million, according to the company.
Fairmarkit wants to replace large procurement software systems from companies like Oracle and SAP that have been around for decades, says company co-founder and CEO Kevin Frechette. When he looked around a couple of years ago, he saw a space full of these legacy vendors and ripe for disruption.
What’s more, he says that these systems have been designed to track only the biggest purchases over $500,000 or $1 million. Anything under that is what’s known as tail spend. “So procurement really focuses on companies’ biggest purchases, say things over a million, but anything under that size just gets forgotten about and neglected. It’s called tail spend, and it’s still 80% of what they buy, 80% of their vendors and 20% of the budget,” he told me.
This spending accounts for billions of dollars, yet Frechette says, it has lacked a good tracking system. He saw an opportunity, and he and his co-founders built a solution. Its first customer was the MBTA, Boston’s mass transit system (a system that could use all the help it can get in terms of getting more efficient). Today the company has more than 50 customers across a variety of industries.
The system acts as a marketplace for vendors and a central buying system for customers where they can find goods and services at this price point below $1 million. It imports a customer’s vendor data, and then combines this with other data to build a huge database of buying information. From that, they can determine what a customer needs and using AI, find the best prices for a particular order.
Frechette says this not only provides a way to save money — he says customers have been able to cut purchase costs by 10% with his system — it also provides a way to surface diverse vendors, whether that’s businesses owned by women, people of color, veterans, local business or however you define that.
He says too often what happens is that these deals aren’t put under typical procurement department scrutiny and they just get passed through, but Fairmarkit helps surface these companies and give them a shot at the business. “So because the core of our technology is a vendor recommendation engine […], we can help to invite those diverse vendors and really just give them a fair shot,” he said.
The company started the year with 40 employees and have added 30 since. The plan is to double that number next year, and as they do, Frechette hopes to reflect the diversity of the company’s product by building a correspondingly diverse employee base.
“It’s really just keeping it at the forefront. We want to make sure that we’re not just doing surveys around how we are doing for diversity and inclusion, but we’re putting programs in place to help out with it. It’s something I’m very very passionate about because it’s been such a sticking point as well on how we’re helping diverse vendors,” he said.
Frechette says that he has managed to grow the company and build a culture in spite of the pandemic not allowing employees to come into an office. He doesn’t see a world where the office will be a requirement in the future.
“We’ve hit an inflection point this year where there’s no world where we need everyone to be in an office […], which once again only helps to accelerate our business because we’re not constricted by everyone in this one small [geographical] sector. We can operate across the board [from anywhere],” he said.
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GrubMarket raises $60M as food delivery stays center stage
Companies that have leveraged technology to make the procurement and delivery of food more accessible to more people have been seeing a big surge of business this year, as millions of consumers are encouraged (or outright mandated, due to COVID-19) to socially distance or want to avoid the crowds of physical shopping and eating excursions.
Today, one of the companies that is supplying produce and other items both to consumers and other services that are in turn selling food and groceries to them, is announcing a new round of funding as it gears up to take its next step, an IPO.
GrubMarket, which provides a B2C platform for consumers to order produce and other food and home items for delivery, and a B2B service where it supplies grocery stores, meal-kit companies and other food tech startups with products that they resell, is today announcing that it has raised $60 million in a Series D round of funding.
Sources close to the company confirmed to TechCrunch that GrubMarket — which is profitable, and originally hadn’t planned to raise more than $20 million — has now doubled its valuation compared to its last round — sources tell us it is now between $400 million and $500 million.
The funding is coming from funds and accounts managed by BlackRock, Reimagined Ventures, Trinity Capital Investment, Celtic House Venture Partners, Marubeni Ventures, Sixty Degree Capital and Mojo Partners, alongside previous investors GGV Capital, WI Harper Group, Digital Garage, CentreGold Capital, Scrum Ventures and other unnamed participants. Past investors also included Y Combinator, where GrubMarket was part of the Winter 2015 cohort. For some context, GrubMarket last raised money in April 2019 — $28 million at a $228 million valuation, a source says.
Mike Xu, the founder and CEO, said that the plan remains for the company to go public (he’s talked about it before), but given that it’s not having trouble raising from private markets and is currently growing at 100% over last year, and the IPO market is less certain at the moment, he declined to put an exact timeline on when this might actually happen, although he was clear that this is where his focus is in the near future.
“The only success criteria of my startup career is whether GrubMarket can eventually make $100 billion of annual sales,” he said to me over both email and in a phone conversation. “To achieve this goal, I am willing to stay heads-down and hardworking every day until it is done, and it does not matter whether it will take me 15 years or 50 years.”
I don’t doubt that he means it. I’ll note that we had this call in the middle of the night his time in California, even after I asked multiple times if there wasn’t a more reasonable hour in the daytime for him to talk. (He insisted that he got his best work done at 4:30 a.m., a result of how a lot of the grocery business works.) Xu on the one hand is very gentle with a calm demeanor, but don’t let his quiet manner fool you. He also is focused and relentless in his work ethic.
When people talk today about buying food, alongside traditional grocery stores and other physical food markets, they increasingly talk about grocery delivery companies, restaurant delivery platforms, meal kit services and more that make or provide food to people by way of apps. GrubMarket has built itself as a profitable but quiet giant that underpins the fuel that helps companies in all of these categories by becoming one of the critical companies building bridges between food producers and those that interact with customers.
Its opportunity comes in the form of disruption and a gap in the market. Food production is not unlike shipping and other older, non-tech industries, with a lot of transactions couched in legacy processes: GrubMarket has built software that connects the different segments of the food supply chain in a faster and more efficient way, and then provides the logistics to help it run.
To be sure, it’s an area that would have evolved regardless of the world health situation, but the rise and growth of the coronavirus has definitely “helped” GrubMarket not just by creating more demand for delivered food, but by providing a way for those in the food supply chain to interact with less contact and more tech-fueled efficiency.
Sales of WholesaleWare, as the platform is called, Xu said, have seen more than 800% growth over the last year, now managing “several hundreds of millions of dollars of food wholesale activities” annually.
Underpinning its tech is the sheer size of the operation: economies of scale in action. The company is active in the San Francisco Bay Area, Los Angeles, San Diego, Seattle, Texas, Michigan, Boston and New York (and many places in between) and says that it currently operates some 21 warehouses nationwide. Xu describes GrubMarket as a “major food provider” in the Bay Area and the rest of California, with (as one example) more than 5 million pounds of frozen meat in its east San Francisco Bay warehouse.
Its customers include more than 500 grocery stores, 8,000 restaurants and 2,000 corporate offices, with familiar names like Whole Foods, Kroger, Albertson, Safeway, Sprouts Farmers Market, Raley’s Market, 99 Ranch Market, Blue Apron, Hello Fresh, Fresh Direct, Imperfect Foods, Misfit Market, Sun Basket and GoodEggs all on the list, with GrubMarket supplying them items that they resell directly, or use in creating their own products (like meal kits).
While much of GrubMarket’s growth has been — like a lot of its produce — organic, its profitability has helped it also grow inorganically. It has made some 15 acquisitions in the last two years, including Boston Organics and EJ Food Distributor this year.
It’s not to say that GrubMarket has not had growing pains. The company, Xu said, was like many others in the food delivery business — “overwhelmed” at the start of the pandemic in March and April of this year. “We had to limit our daily delivery volume in some regions, and put new customers on waiting lists.” Even so, the B2C business grew between 300% and 500% depending on the market. Xu said things calmed down by May and even as some B2B customers never came back after cities were locked down, as a category, B2B has largely recovered, he said.
Interestingly, the startup itself has taken a very proactive approach in order to limit its own workers’ and customers’ exposure to COVID-19, doing as much testing as it could — tests have been, as we all know, in very short supply — as well as a lot of social distancing and cleaning operations.
“There have been no mandates about masks, but we supplied them extensively,” he said.
So far it seems to have worked. Xu said the company has only found “a couple of employees” that were positive this year. In one case in April, a case was found not through a test (which it didn’t have, this happened in Michigan) but through a routine check and finding an employee showing symptoms, and its response was swift: the facilities were locked down for two weeks and sanitized, despite this happening in one of the busiest months in the history of the company (and the food supply sector overall).
That’s notable leadership at a time when it feels like a lot of leaders have failed us, which only helps to bolster the company’s strong growth.
“Having a proven track record of sustained hypergrowth and net income profitability, GrubMarket stands out as an extraordinarily rare Silicon Valley startup in the food technology and ecommerce segment,” said Jay Chen, managing partner of Celtic House Venture Partner. “Scaling over 15x in 4 years, GrubMarket’s creativity and capital efficiency is unmatched by anyone else in this space. Mike’s team has done an incredible job growing the company thoughtfully and sustainably. We are proud to be a partner in the company’s rapid nationwide expansion and excited by the strong momentum of WholesaleWare, their SaaS suite, which is the best we have seen in space.”
Updated with more detail on the valuation.
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Avo raises $3M for its analytics governance platform
Avo, a startup that helps businesses better manage their data quality across teams, today announced that it has raised a $3 million seed round led by GGV Capital, with participation from Heavybit, Y Combinator and others.
The company’s founder, Stefania Olafsdóttir, who is currently based in Iceland, was previously the head of data science at QuizUp, which at some point had 100 million users around the world. “I had the opportunity to build up the Data Science Division, and that meant the cultural aspect of helping people ask and answer the right questions — and get them curious about data — but it also meant the technical part of setting up the infrastructure and tools and pipelines, so people can get the right answers when they need it,” she told me. “We were early adopters of self-serve product analytics and culture — and we struggled immensely with data reliability and data trust.”
Image Credits: Avo
As companies collect more data across products and teams, the process tends to become unwieldy and different teams end up using different methods (or just simply different tags), which creates inefficiencies and issues across the data pipeline.
“At first, that unreliable data just slowed down decision making, because people were just like, didn’t understand the data and needed to ask questions,” Olafsdóttir said about her time at QuizUp. “But then it caused us to actually launch bad product updates based on incorrect data.” Over time, that problem only became more apparent.
“Once organizations realize how big this issue is — that they’re effectively flying blind because of unreliable data, while their competition might be like taking the lead on the market — the default is to patch together a bunch of clunky processes and tools that partially increase the level of liability,” she said. And that clunky process typically involves a product manager and a spreadsheet today.
At its core, the Avo team set out to build a better process around this, and after a few detours and other product ideas, Olafsdóttir and her co-founders regrouped to focus on exactly this problem during their time in the Y Combinator program.
Avo gives developers, data scientists and product managers a shared workspace to develop and optimize their data pipelines. “Good product analytics is the product of collaboration between these cross-functional groups of stakeholders,” Olafsdóttir argues, and the goal of Avo is to give these groups a platform for their analytics planning and governance — and to set company-wide standards for how they create their analytics events.
Once that is done, Avo provides developers with typesafe analytics code and debuggers that allows them to take those snippets and add them to their code within minutes. For some companies, this new process can help them go from spending 10 hours on fixing a specific analytics issue to an hour or less.
Most companies, the team argues, know — deep down — that they can’t fully trust their data. But they also often don’t know how to fix this problem. To help them with this, Avo also today released its Inspector product. This tool processes event streams for a company, visualizes them and then highlights potential errors. These could be type mismatches, missing properties or other discrepancies. In many ways, that’s obviously a great sales tool for a service that aims to avoid exactly these problems.
One of Avo’s early customers is Rappi, the Latin American delivery service. “This year we scaled to meet the demand of 100,000 new customers digitizing their deliveries and curbside pickups. The problem with every new software release was that we’d break analytics. It represented 25% of our Jira tickets,” said Rappi’s head of Engineering, Damian Sima. “With Avo we create analytics schemas upfront, identify analytics issues fast, add consistency over time and ensure data reliability as we help customers serve the 12+ million monthly users their businesses attract.”
As most startups at this stage, Avo plans to use the new funding to build out its team and continue to develop its product.
“The next trillion-dollar software market will be driven from the ground up, with developers deciding the tools they use to create digital transformation across every industry. Avo offers engineers ease of implementation while still retaining schemas and analytics governance for product leaders,” said GGV Capital Managing Partner Glenn Solomon. “Our investment in Avo is an investment in software developers as the new kingmakers and product leaders as the new oracles.”
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Merico raises $4.1M for its developer analytics platform
Merico, a startup that gives companies deeper insights into their developers’ productivity and code quality, today announced that it has raised a $4.1 million seed round led by GGV Capital, with participation from Legend Star and previous investor Polychain Capital. The company was originally funded by the open source-centric firm OSS Capital.
“The mission of Merico is to empower every developer to build better and realize more value. We are excited that GGV Capital and our other investors see the importance of bringing more useful data to the software development process,” said Merico founder and CEO Jinglei Ren. “In today’s world, enabling remote contribution is more important than ever, and we at Merico are excited to continue our pursuit of bringing the most insightful and practical metrics to support both enterprise and open-source software teams.”
Merico head of business development Maxim Wheatley tells me that the company plans to use the new funding to enhance and expand its existing technology and marketing efforts. As a remote-first startup, Merico already has team members in the U.S., Brazil, France, Canada, India and China.
“In keeping with our roots and mission in open source, we will be focusing some of these new resources to engage more collaboratively with open-source foundations, contributors and maintainers,” he added.
The idea behind Merico was born out of two key observations, Wheatley said. First of all, the team wanted to create a better way to analyze developer productivity and the quality of the code they generate. Some companies still simply use the number of lines of code generated by a developer to allocate bonuses for their teams, for example, which isn’t a great metric by any means. In addition, the team also wanted to find ways to better allocate income and recognition to the community members of open-source projects based on the quality of their contributions.
The company’s tool is systems agnostic because it bases its analysis on the codebase and workflow tools instead of looking at lines of codes or commit counts, for example.
“Merico evaluates the actual code, in addition to related processes, and places productivity in the context of quality and impact,” said Merico CTO Hezheng Yin . “In this process, we evaluate impact leveraging dependency relationships and examine fundamental indicators of quality including bug density, redundancy, modularity, test-coverage, documentation-coverage, code-smell and more. By compiling these signals into a single point of truth, Merico can determine the quality and the productivity of a developer or a team in a manner that more accurately reflects the nature of the work.”
As of now, Merico supports code written in Java, JavaScript (Vue.js and React.js), TypeScript, Go, C, C++, Ruby and Python, with support for other languages coming later.
“Merico’s technology delivers the most advanced code analytics that we’ve seen on the market,” said GGV’s Jenny Lee . “With the Merico team, we saw an opportunity to empower the organizations of tomorrow with insight. In this era of remote transformation, there’s never been a more critical time to bring this visibility to the enterprise and to open source; we can’t wait to see how this technology drives innovation in both technology and management.”
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Valence, the site dedicated to increasing economic opportunity for the Black community, raises $5.25 million
Valence, the Los Angeles-based online community dedicated to increasing economic opportunity for the Black community, has raised $5.25 million in financing as it looks to continue to expand its network for Black professionals in all fields.
The timing for the investment is critical as the country reckons with the implications and effects of systemic racism. In no field is the under-representation of Black professionals more deeply felt than the tech industry, where lack of diversity can have profound implications on products and services that are becoming increasingly central to large swaths of the economy.
Problems with under-representation and underlying issues of systemic racism manifest in facial recognition technologies, social networking applications and decision-making software for lending and credit that are aspects of how American society functions.
It’s with an eye toward technology and entrepreneurship that Valence raised its most recent round, according to a letter sent to the company’s users by new chief executive officer Guy Primus.
“Now that we have the capital that we were seeking, we will be doing three things. First we will improve the current product. We are very proud of what we have built thus far, but we know there are a few issues. We will continue to address those issues and will accelerate work to enhance technical performance on the platform,” Primus wrote. “Second, we will be expanding the team. We expect the team to more than triple in the coming months so that we can better serve you. Finally, we’ll be adding features and expanding our services. We will be delivering additional tools that facilitate even more meaningful connections and will expand Valence’s scope to include the professional growth and development of our members.”
A lot of that product development will go toward building tools that can help with professional development and career growth.
“We’re being very targeted in how we can drive economic opportunity and wealth creation in the black community,” said Valence co-founder and Upfront Ventures general partner Kobie Fuller.
Already, Valence has brought on some of the top names in Silicon Valley as participants in a program to promote entrepreneurship and career development.
Valence currently has 10,000 people signed up for the platform and is growing at about 20% per month, according to Primus. The goal is to serve educational advice and tools to Valence users while at the same time making that group of career-minded Black professionals available to companies that would want to hire them.
Primus said that Valence will be selling its database and access to companies that would want to find prospective hires on the platform in a per-seat licensing model that would be accessible to headhunters and human resources departments.
The new investment round was led by GGV Capital, the international investment firm whose investments include Slack, Peloton, Wish and StockX. Hans Tung, the managing director who invested in those marquee deals, will be joining the company’s board of directors.
Other investors in the round include Upfront Ventures, along with Maveron, the SoftBank Opportunity Fund and Silicon Valley Bank.
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With former Misfit founder Sonny Vu at the helm, Arevo raises $25 million for its 3D printing tech
Sonny Vu, the former founder and chief executive of the wearable technology company Misfit, has had a busy summer since he was named the new chief executive of 3D printing technology company Arevo.
Vu’s new startup brought on a new executive management team, launched a crowdfunding campaign for its 3D-printed Superstrata bicycle and is now announcing the close of a $25 million financing round to support the growth of its business.
It’d be a lot for anyone to take on even if it didn’t happen in the middle of a global pandemic. But Vu, a serial entrepreneur whose last business went head-to-head with Apple before it was acquired by Fossil for $260 million, doesn’t shy away from challenges.
Vu was first introduced to Arevo in 2019 and was initially going to come on as an advisor to the company. Since the acquisition of Misfit he had been investing from Alabaster, his personal investment vehicle. First introduced by Vinod Khosla, an investor in the business, Vu quickly moved from being an advisor to an executive at the helm of the business and an investor providing bridge financing until the company could close its latest round.
Vu had initially intended to start his own business, but was drawn to Arevo’s potential. “3D printing is about making things slowly and in small quantities. With Arevo’s technology you can make big things quite fast,” Vu said in an interview.
Several companies are attempting to take 3D printing into heavy industry and large-scale manufacturing. Relativity raised $140 million in its most recent financing to make rockets using 3D printers, Velo3D is a supplier of 3D printers to SpaceX and now Arevo has $34 million for its efforts to scale 3D printers. Of course, all of these investments pale in comparison to the whopping $438 million that Desktop Metal has raised for its 3D printing tech.
“Arevo is a compelling opportunity for us as it combines our three main investment foci: consumer internet, enterprise, and smart tech. We see fantastic potential in this market, and have backed Sonny before at Misfit,” said Hans Tung, in a statement. “Arevo is led by an experienced team with solid technological foundation and 3D printing manufacturing know-how at scale – to offer breakthrough products at competitive prices.”
Arevo already has a successful proof of concept with its Superstrata bicycle and manufacturing facilities in Vietnam that are intended to prove that the company’s technology will work as expected.
“We’re making this bike to make a point that we can make complex shapes at a pretty large scale,” Vu said. Unlike other companies that sell their printers to manufacturers, Arevo intends to sell parts. That’s because the printers are a pretty hefty ticket for anyone to buy. At $1 million to $1.4 million, it’s a big ask for a company to acquire if it wants to start using 3D printing.
On top of that cost, Vu said candidly that the company’s Achilles’ heel was the post-manufacturing treatment process required to finish the pieces. And while Arevo already counts automotive and aerospace companies as customers (including Airbus, which previously invested in the business), Vu wants to bring this to consumers. “We’ve had tennis racquet companies, golf clubs, surfboards,” approach Arevo about using the company’s technology, Vu says.
“We can do about two frames per day per machine,” Vu says of the latest production rates. “And coming up with our next-gen system we can do about six frames per day.”
The ascension of Vu to the chief executive position and the new capital infusion marks the latest chapter for Arevo, which is on its third chief executive since it was founded. Two years ago, Jim Miller, a former Amazon and Google executive, was brought on board to take the reins at the company. Miller’s appointment coincided with a $12.5 million investment round led by Asahi Glass, with Sumitomo Corp., Leslie Ventures and Khosla Ventures participating. Miller was involved with collaborating with Studio West on the design of its Superstrata bike.
Now, Defy Partners and GGV Capital are joining to lead the company’s Series B round with participation from Khosla Ventures, Alabaster and others. Brian Shin, a scout with Defy Ventures is joining the board, which now counts Bruce Armstrong, from Khosla Ventures, and Hemant Bheda, Arevo’s co-founder, as directors (along with Vu).
“Arevo’s new platform enables fabrication of high-strength, low-weight carbon fiber parts, currently not possible with today’s standard techniques,” said Trae Vassallo, founding partner at Defy. “We are thrilled to be working with the team to help scale up this incredibly impactful technology.”
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