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Real-time database platform SingleStore raises $80M more, now at a $940M valuation
Organizations are swimming in data these days, and so solutions to help manage and use that data in more efficient ways will continue to see a lot of attention and business. In the latest development, SingleStore — which provides a platform to enterprises to help them integrate, monitor and query their data as a single entity, regardless of whether that data is stored in multiple repositories — is announcing another $80 million in funding, money that it will be using to continue investing in its platform, hiring more talent and overall business expansion. Sources close to the company tell us that the company’s valuation has grown to $940 million.
The round, a Series F, is being led by Insight Partners, with new investor Hewlett Packard Enterprise, and previous backers Khosla Ventures, Dell Technologies Capital, Rev IV, Glynn Capital and GV (formerly Google Ventures) also participating. The startup has to date raised $264 million, including most recently an $80 million Series E last December, just on the heels of rebranding from MemSQL.
The fact that there are three major strategic investors in this Series F — HPE, Dell and Google — may say something about the traction that SingleStore is seeing, but so too do its numbers: 300%+ increase in new customer acquisition for its cloud service and 150%+ year-over-year growth in cloud.
Raj Verma, SingleStore’s CEO, said in an interview that its cloud revenues have grown by 150% year over year and now account for some 40% of all revenues (up from 10% a year ago). New customer numbers, meanwhile, have grown by over 300%.
“The flywheel is now turning around,” Verma said. “We didn’t need this money. We’ve barely touched our Series E. But I think there has been a general sentiment among our board and management that we are now ready for the prime time. We think SingleStore is one of the best-kept secrets in the database market. Now we want to aggressively be an option for people looking for a platform for intensive data applications or if they want to consolidate databases to one from three, five or seven repositories. We are where the world is going: real-time insights.”
With database management and the need for more efficient and cost-effective tools to manage that becoming an ever-growing priority — one that definitely got a fillip in the last 18 months with COVID-19 pushing people into more remote working environments. That means SingleStore is not without competitors, with others in the same space, including Amazon, Microsoft, Snowflake, PostgreSQL, MySQL, Redis and more. Others like Firebolt are tackling the challenges of handing large, disparate data repositories from another angle. (Some of these, I should point out, are also partners: SingleStore works with data stored on AWS, Microsoft Azure, Google Cloud Platform and Red Hat, and Verma describes those who do compute work as “not database companies; they are using their database capabilities for consumption for cloud compute.”)
But the company has carved a place for itself with enterprises and has thousands now on its books, including GE, IEX Cloud, Go Guardian, Palo Alto Networks, EOG Resources and SiriusXM + Pandora.
“SingleStore’s first-of-a-kind cloud database is unmatched in speed, scale, and simplicity by anything in the market,” said Lonne Jaffe, managing director at Insight Partners, in a statement. “SingleStore’s differentiated technology allows customers to unify real-time transactions and analytics in a single database.” Vinod Khosla from Khosla Ventures added that “SingleStore is able to reduce data sprawl, run anywhere, and run faster with a single database, replacing legacy databases with the modern cloud.”
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Human Interest raises $200M at a $1B valuation, plans for an IPO
Less than six months after raising $55 million in a Series C round of funding, SMB 401(k) provider Human Interest today announced it has raised $200 million in a round that propels it to unicorn status.
The Rise Fund, TPG’s global impact investing platform, led the round and was joined by SoftBank Vision Fund 2. The financing included participation from new investor Crosslink Capital and existing backers NewView Capital, Glynn Capital, U.S. Venture Partners, Wing Venture Capital, Uncork Capital, Slow Capital, Susa Ventures and others.
Over the past year, the San Francisco-based company has raised $305 million. With the latest financing, it has now raised a total of $336.7 million since its 2015 inception.
The company admittedly has an IPO in its sights, as evidenced by the appointment of former Yodlee CFO Mike Armsby to the role of CFO at Human Interest. It’s targeting a traditional IPO sometime in 2023, with execs saying the target is to have “$200 million+ in run-rate revenue before going public.” Currently, it’s at “tens of millions of run-rate revenue” now, and adding millions of new revenue each month.
Human Interest’s digital retirement benefits platform allows users “to launch a retirement plan in minutes and put it on autopilot,” according to the company. It also touts that it has eliminated all 401(k) transaction fees.
Demand for 401(k)s by SMBs appears to be at an all-time high, with Human Interest reporting that its sales tripled over the last year. The company has also more than doubled its headcount over the last 12 months to 350 employees.
The startup said it is seeing strong adoption in verticals that have not previously had retirement benefits, including construction, retail, manufacturing, restaurants, nonprofits and hospitality. For example, over the past three quarters, Human Interest has seen 4.5x customer growth in the restaurant sector. Since the start of the pandemic, Human Interest has experienced 2x higher enrollment growth among hourly workers than salaried workers, and hourly worker assets have tripled.
“Promoting financial health is a core investment pillar for The Rise Fund. Human Interest delivers one of the most compelling solutions to the persistent problem that roughly half of Americans will not have enough savings when they reach retirement age,” said Maya Chorengel, co-managing partner at The Rise Fund, in a written statement. “Despite recent legislation, primarily at the state level, legacy programs have not, to date, produced the same participant outcomes as Human Interest.”
The company said it will be using its new capital to expand its network of integrations and partnerships with financial advisers, benefits brokers and payroll companies. It also expects to, naturally, do some hiring –– another 200 employees by year’s end, primarily in its product, engineering and revenue teams.
The 401(k) for SMB space is heating up as of late. In June, competitor Guideline also raised $200 million in a round led by General Atlantic.
Additional details around the IPO and revenue were added post-publication.
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SingleStore, formerly MemSQL, raises $80M to integrate and leverage companies’ disparate data silos
While the enterprise world likes to talk about “big data”, that term belies the real state of how data exists for many organizations: the truth of the matter is that it’s often very fragmented, living in different places and on different systems, making the concept of analysing and using it in a single, effective way a huge challenge.
Today, one of the big up-and-coming startups that has built a platform to get around that predicament is announcing a significant round of funding, a sign of the demand for its services and its success so far in executing on that.
SingleStore, which provides a SQL-based platform to help enterprises manage, parse and use data that lives in silos across multiple cloud and on-premise environments — a key piece of work needed to run applications in risk, fraud prevention, customer user experience, real-time reporting and real-time insights, fast dashboards, data warehouse augmentation, modernization for data warehouses and data architectures and faster insights — has picked up $80 million in funding, a Series E round that brings in new strategic investors alongside its existing list of backers.
The round is being led by Insight Partners, with new backers Dell Technologies Capital, Hercules Capital; and previous backers Accel, Anchorage, Glynn Capital, GV (formerly Google Ventures) and Rev IV also participating.
Alongside the investment, SingleStore is formally announcing a new partnership with analytics powerhouse SAS. I say “formally” because they two have been working together already and it’s resulted in “tremendous uptake,” CEO Raj Verma said in an interview over email.
Verma added that the round came out of inbound interest, not its own fundraising efforts, and as such, it brings the total amount of cash it has on hand to $140 million. The gives the startup money to play with not only to invest in hiring, R&D and business development, but potentially also M&A, given that the market right now seems to be in a period of consolidation.
Verma said the valuation is a “significant upround” compared to its Series D in 2018 but didn’t disclose the figure. PitchBook notes that at the time it was valued at $270 million post-money.
When I last spoke with the startup in May of this year — when it announced a debt facility of $50 million — it was not called SingleStore; it was MemSQL. The company rebranded at the end of October to the new name, but Verma said that the change was a long time in the planning.
“The name change is one of the first conversations I had when I got here,” he said about when he joined the company in 2019 (he’s been there for about 16 months). “The [former] name didn’t exactly flow off the tongue and we found that it no longer suited us, we found ourselves in a tiny shoebox of an offering, in saying our name is MemSQL we were telling our prospects to think of us as in-memory and SQL. SQL we didn’t have a problem with but we had outgrown in-memory years ago. That was really only 5% of our current revenues.”
He also mentioned the hang up many have with in-memory database implementations: they tend to be expensive. “So this implied high TCO, which couldn’t have been further from the truth,” he said. “Typically we are ⅕-⅛ the cost of what a competitive product would be to implement. We were doing ourselves a disservice with prospects and buyers.”
The company liked the name SingleStore because it is based a conceptual idea of its proprietary technology. “We wanted a name that could be a verb. Down the road we hope that when someone asks large enterprises what they do with their data, they will say that they ‘SingleStore It!’ That is the vision. The north star is that we can do all types of data without workload segmentation,” he said.
That effort is being done at a time when there is more competition than ever before in the space. Others also providing tools to manage and run analytics and other work on big data sets include Amazon, Microsoft, Snowflake, PostgreSQL, MySQL and more.
SingleStore is not disclosing any metrics on its growth at the moment but says it has thousands of enterprise customers. Some of the more recent names it’s disclosed include GE, IEX Cloud, Go Guardian, Palo Alto Networks, EOG Resources, SiriusXM + Pandora, with partners including Infosys, HCL and NextGen.
“As industry after industry reinvents itself using software, there will be accelerating market demand for predictive applications that can only be powered by fast, scalable, cloud-native database systems like SingleStore’s,” said Lonne Jaffe, managing director at Insight Partners, in a statement. “Insight Partners has spent the past 25 years helping transformational software companies rapidly scale-up, and we’re looking forward to working with Raj and his management team as they bring SingleStore’s highly differentiated technology to customers and partners across the world.”
“Across industries, SAS is running some of the most demanding and sophisticated machine learning workloads in the world to help organizations make the best decisions. SAS continues to innovate in AI and advanced analytics, and we partner with companies like SingleStore that share our curiosity about how data and analytics can help organizations reimagine their businesses and change the world,” said Oliver Schabenberger, COO and CTO at SAS, added. “Our engineering teams are integrating SingleStore’s scalable SQL-based database platform with the massively parallel analytics engine SAS Viya. We are excited to work with SingleStore to improve performance, reduce cost, and enable our customers to be at the forefront of analytics and decisioning.”
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Couchbase raises $105M Series G funding round
Couchbase, the Santa Clara-based company behind the eponymous NoSQL cloud database service, today announced that it has raised a $105 million all-equity Series G round “to expand product development and global go-to-market capabilities.”
The oversubscribed round was led by GPI Capital, with participation from existing investors Accel, Sorenson Capital, North Bridge Venture Partners, Glynn Capital, Adams Street Partners and Mayfield. With this, the company has now raised a total of $251 million, according to Crunchbase.
Back in 2016, Couchbase raised a $30 million down round, which at the time was meant to be the company’s last round before an IPO. That IPO hasn’t materialized, but the company continues to grow, with 30% of the Fortune 100 now using its database. Couchbase also today announced that, over the course of the last fiscal year, it saw 70% total contract value growth, more than 50% new business growth and over 35% growth in average subscription deal size. In total, Couchbase said today, it is now seeing almost $100 million in committed annual recurring revenue.
“To be competitive today, enterprises must transform digitally, and use technology to get closer to their customers and improve the productivity of their workforces,” Couchbase President and CEO Matt Cain said in today’s announcement. “To do so, they require a cloud-native database built specifically to support modern web, mobile and IoT applications. Application developers and enterprise architects rely on Couchbase to enable agile application development on a platform that performs at scale, from the public cloud to the edge, and provides operational simplicity and reliability. More and more, the largest companies in the world truly run their businesses on Couchbase, architecting their most business-critical applications on our platform.”
The company is playing in a large but competitive market, with the likes of MongoDB, DataStax and all the major cloud vendors vying for similar customers in the NoSQL space. One feature that has always made Couchbase stand out is Couchbase Mobile, which extends the service to the cloud. Like some of its competitors, the company has also recently placed its bets on the Kubernetes container orchestration tools with, for example the launch of its Autonomous Operator for Kubernetes 2.0. More importantly, though, the company also introduced its fully managed Couchbase Cloud Database-as-a-Service in February, which allows businesses to run the database within their own virtual private cloud on public clouds like AWS and Microsoft Azure.
“We are excited to partner with Couchbase and view Couchbase Server’s highly performant, distributed architecture as purpose-built to support mission-critical use cases at scale,” said Alex Migon, a partner at GPI Capital and a new member of the company’s board of directors. “Couchbase has developed a truly enterprise-grade product, with leading support for cutting-edge application development and deployment needs. We are thrilled to contribute to the next stage of the company’s growth.”
The company tells me that it plans to use the new funding to continue its “accelerated trajectory with investment in each of their three core pillars: sustained differentiation, profitable growth, and world class teams.” Of course, Couchbase will also continue to build new features for its NoSQL server, mobile platform and Couchbase Cloud — in addition, the company will continue to expand geographically to serve its global customer operations.
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Human Interest tacks on $10M more to its Series C
The COVID-19 pandemic is making life worse for many startups, but not all. Those benefiting are often taking advantage of the market updraft to add more capital to their accounts. Robinhood, for example, saw usage of its consumer fintech product rise rapidly. Then the company raised a Series F worth $280 million at a new, higher valuation.
Another startup has done something similar. Human Interest, a finservices 401(k) provider for SMBs, added $10 million to its Series C today. The company’s Series C round is now worth a total of $50 million. Glynn Capital led the Series C extension.
The reason for the new capital is simple. According to Jeff Schneble, the company’s CEO, Human Interest has seen “some of the strongest sales months in the company’s history, and are seeing 2-3X year-over-year growth in customer acquisition even in the midst of the COVID-19 crisis.”
When usage and revenue scale ahead of expectations, options open up. TechCrunch had a few questions about the additional capital. Let’s explore.
$10 million more
TechCrunch first wanted to know if the San Francisco-based Human Interest’s new $10 million — which brings its total known capital raised to around $80 million — is earmarked for offense (greater investment into GTM functions, for example), or defense (runway extension, and so forth).
According to the CEO, the round is “more about playing offense,” with the executive adding that offense has been “something we’ve had the luxury of thinking about since the beginning of the crisis, given our large raise in February.” Human Interest intends to double its engineering team, and is “aggressively ramping up [its] GTM team (more reps, more partners, growing our marketing team and budget).”
TechCrunch was also curious about its customer profile — is Human Interest seeing growth from a different set of customers in the COVID-19 era? According to Schneble, not really: “We have not seen a significant shift in customer size, geography or vertical,” he said.
Human Interest, however, is seeing more companies coming to it looking to change 401(k) providers. Schneble told TechCrunch that “historically” 85% of his company’s customers are looking to offer “a retirement benefit for the first time.” However, “in the last couple of months” Human Interest has seen “a surge of customers with existing retirement plans that want to move to a lower-cost benefit.”
As Human Interest uses “technology, rather than people” to run its 401(k) service, the startup can offer a service that is “typically 30-50% lower-cost than a legacy 401(k) plan,” according to Schneble.
Is this new demand changing the company’s economics? TechCrunch wanted to know if market interest in 401(k) plans — consumers are flocking to savings and investing apps, likely driving more companies to add retirement savings plans for their employees — was lowering Human Interest’s customer acquisition costs (CAC).
According to the CEO, Human Interest focuses on gross-margin payback, or the time period it takes for gross-margin adjusted revenue to repay CAC. “I can’t stress how important profitability is in this space,” Schneble told TechCrunch, adding that “many of [his] competitors have negative contribution margins, which is obviously not a recipe for building a successful public company.”
The company’s gross-margin payback pace is improving, with the company telling TechCrunch that it has “come down by ~70% in the past 12 months, and is now approaching zero for many of our customers (meaning the margin contribution from their initial payment when they launch their plan covers our CAC).”
Human Interest’s gross margins help with that, with Human Interest telling TechCrunch that it has “typical software margins” on its product. That means 70%+ gross margins.
Back to the $10 million add-on, TechCrunch confirmed that the new capital was raised at the same pre-money valuation as the rest of its Series C. The CEO added the following color:
We had interest from several of the later-stage growth funds we talked to in our Series C process, but decided to move forward with Glynn Capital. They are long-term investors that plan to hold their investment in us long after we’re public (similar to one of our other large investors, Oberndorf Enterprises). While we probably could have demanded a higher price for the extension, given the acceleration we’ve seen in the last few months, we decided to optimize on partner quality instead.
Now with more capital aboard, expectations are even higher for Human Interest. Let’s see how fast it can grow.
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