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Gatheround raises millions from Homebrew, Bloomberg and Stripe’s COO to help remote workers connect
Remote work is no longer a new topic, as much of the world has now been doing it for a year or more because of the COVID-19 pandemic.
Companies — big and small — have had to react in myriad ways. Many of the initial challenges have focused on workflow, productivity and the like. But one aspect of the whole remote work shift that is not getting as much attention is the culture angle.
A 100% remote startup that was tackling the issue way before COVID-19 was even around is now seeing a big surge in demand for its offering that aims to help companies address the “people” challenge of remote work. It started its life with the name Icebreaker to reflect the aim of “breaking the ice” with people with whom you work.
“We designed the initial version of our product as a way to connect people who’d never met, kind of virtual speed dating,” says co-founder and CEO Perry Rosenstein. “But we realized that people were using it for far more than that.”
So over time, its offering has evolved to include a bigger goal of helping people get together beyond an initial encounter –– hence its new name: Gatheround.
“For remote companies, a big challenge or problem that is now bordering on a crisis is how to build connection, trust and empathy between people that aren’t sharing a physical space,” says co-founder and COO Lisa Conn. “There’s no five-minute conversations after meetings, no shared meals, no cafeterias — this is where connection organically builds.”
Organizations should be concerned, Gatheround maintains, that as we move more remote, that work will become more transactional and people will become more isolated. They can’t ignore that humans are largely social creatures, Conn said.
The startup aims to bring people together online through real-time events such as a range of chats, videos and one-on-one and group conversations. The startup also provides templates to facilitate cultural rituals and learning & development (L&D) activities, such as all-hands meetings and workshops on diversity, equity and inclusion.
Gatheround’s video conversations aim to be a refreshing complement to Slack conversations, which despite serving the function of communication, still don’t bring users face-to-face.
Image Credits: Gatheround
Since its inception, Gatheround has quietly built up an impressive customer base, including 28 Fortune 500s, 11 of the 15 biggest U.S. tech companies, 26 of the top 30 universities and more than 700 educational institutions. Specifically, those users include Asana, Coinbase, Fiverr, Westfield and DigitalOcean. Universities, academic centers and nonprofits, including Georgetown’s Institute of Politics and Public Service and Chan Zuckerberg Initiative, are also customers. To date, Gatheround has had about 260,000 users hold 570,000 conversations on its SaaS-based, video platform.
All its growth so far has been organic, mostly referrals and word of mouth. Now, armed with $3.5 million in seed funding that builds upon a previous $500,000 raised, Gatheround is ready to aggressively go to market and build upon the momentum it’s seeing.
Venture firms Homebrew and Bloomberg Beta co-led the company’s latest raise, which included participation from angel investors such as Stripe COO Claire Hughes Johnson, Meetup co-founder Scott Heiferman, Li Jin and Lenny Rachitsky.
Co-founders Rosenstein, Conn and Alexander McCormmach describe themselves as “experienced community builders,” having previously worked on President Obama’s campaigns as well as at companies like Facebook, Change.org and Hustle.
The trio emphasize that Gatheround is also very different from Zoom and video conferencing apps in that its platform gives people prompts and organized ways to get to know and learn about each other as well as the flexibility to customize events.
“We’re fundamentally a connection platform, here to help organizations connect their people via real-time events that are not just really fun, but meaningful,” Conn said.
Homebrew Partner Hunter Walk says his firm was attracted to the company’s founder-market fit.
“They’re a really interesting combination of founders with all this experience community building on the political activism side, combined with really great product, design and operational skills,” he told TechCrunch. “It was kind of unique that they didn’t come out of an enterprise product background or pure social background.”
He was also drawn to the personalized nature of Gatheround’s platform, considering that it has become clear over the past year that the software powering the future of work “needs emotional intelligence.”
“Many companies in 2020 have focused on making remote work more productive. But what people desire more than ever is a way to deeply and meaningfully connect with their colleagues,” Walk said. “Gatheround does that better than any platform out there. I’ve never seen people come together virtually like they do on Gatheround, asking questions, sharing stories and learning as a group.”
James Cham, partner at Bloomberg Beta, agrees with Walk that the founding team’s knowledge of behavioral psychology, group dynamics and community building gives them an edge.
“More than anything, though, they care about helping the world unite and feel connected, and have spent their entire careers building organizations to make that happen,” he said in a written statement. “So it was a no-brainer to back Gatheround, and I can’t wait to see the impact they have on society.”
The 14-person team will likely expand with the new capital, which will also go toward helping adding more functionality and details to the Gatheround product.
“Even before the pandemic, remote work was accelerating faster than other forms of work,” Conn said. “Now that’s intensified even more.”
Gatheround is not the only company attempting to tackle this space. Ireland-based Workvivo last year raised $16 million and earlier this year, Microsoft launched Viva, its new “employee experience platform.”
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Arthur.ai snags $15M Series A to grow machine learning monitoring tool
At a time when more companies are building machine learning models, Arthur.ai wants to help by ensuring the model accuracy doesn’t begin slipping over time, thereby losing its ability to precisely measure what it was supposed to. As demand for this type of tool has increased this year, in spite of the pandemic, the startup announced a $15 million Series A today.
The investment was led by Index Ventures with help from newcomers Acrew and Plexo Capital, along with previous investors Homebrew, AME Ventures and Work-Bench. The round comes almost exactly a year after its $3.3 million seed round.
As CEO and co-founder Adam Wenchel explains, data scientists build and test machine learning models in the lab under ideal conditions, but as these models are put into production, the performance can begin to deteriorate under real-world scrutiny. Arthur.ai is designed to root out when that happens.
Even as COVID has wreaked havoc throughout much of this year, the company has grown revenue 300% in the last six months smack dab in the middle of all that. “Over the course of 2020, we have begun to open up more and talk to [more] customers. And so we are starting to get some really nice initial customer traction, both in traditional enterprises as well as digital tech companies,” Wenchel told me. With 15 customers, the company is finding that the solution is resonating with companies.
It’s interesting to note that AWS announced a similar tool yesterday at re:Invent called SageMaker Clarify, but Wenchel sees this as more of a validation of what his startup has been trying to do, rather than an existential threat. “I think it helps create awareness, and because this is our 100% focus, our tools go well beyond what the major cloud providers provide,” he said.
Investor Mike Volpi from Index certainly sees the value proposition of this company. “One of the most critical aspects of the AI stack is in the area of performance monitoring and risk mitigation. Simply put, is the AI system behaving like it’s supposed to?” he wrote in a blog post announcing the funding.
When we spoke a year ago, the company had eight employees. Today it has 17 and it expects to double again by the end of next year. Wenchel says that as a company whose product looks for different types of bias, it’s especially important to have a diverse workforce. He says that starts with having a diverse investment team and board makeup, which he has been able to achieve, and goes from there.
“We’ve sponsored and work with groups that focus on both general sort of coding for different underrepresented groups as well as specifically AI, and that’s something that we’ll continue to do. And actually I think when we can get together for in-person events again, we will really go out there and support great organizations like AI for All and Black Girls Code,” he said. He believes that by working with these groups, it will give the startup a pipeline to underrepresented groups, which they can draw upon for hiring as the needs arise.
Wenchel says that when he can go back to the office, he wants to bring employees back, at least for part of the week for certain kinds of work that will benefit from being in the same space.
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Noyo raises $12.5M Series A to keep building its health insurance API business
This morning, Noyo, a startup that provides APIs that link players in the health insurance space, announced that it has closed a $12.5 million Series A round of funding.
The new capital comes less than a year after the startup disclosed that it had raised around $4 million in pre-seed and seed capital, and that its product was already in the market.
At the time it was clear that Noyo had a laser focus on its part of the healthcare world. Now, nearly a year later, the company confirmed to TechCrunch during conversations surrounding its new capital raise that it’s keeping its focus for now.
Linking the carriers and platforms of other insurance verticals, or varietals, will have to wait.
But Noyo is working in an enormous market, namely the U.S. health insurance universe, one that could provide it with space to grow for years to come. The startup sells the use of its application programming interfaces, or APIs, which in Noyo’s case allow customers to “execute, track, and confirm the fulfillment of member transaction requests to carriers,” citing the startup’s documentation.
The company’s product was born out of frustration that Noyo co-founders Shannon Goggin and Dennis Lee dealt with while working for Zenefits, an HR tech unicorn that ran into problems with regulators and customers alike. For more on that story, our prior reporting is useful. (Notably, AgentSync is another API startup play under construction by Zenefits alums.)
The American healthcare market is enormous, lucrative and fraught with inefficiencies and antiquated technology. And the insurance portion of the healthcare market is similarly titanic and broken, providing an outsize opportunity for a startup that can navigate its politics and unique needs with a technology solution able to help incumbents speed up, and save money.
The Series A
Noyo’s new funding event was led by Costanoa Ventures and Spark Capital. Prior investors Core Innovation Capital, Garuda Ventures, the Webb Investment Network, Precursor Ventures and Homebrew upped their investment in the new round.
Homebrew’s Satya Patel was effusive about the company in a comment provided to TechCrunch, saying that Noyo’s “technology and strategic vision have convinced major industry leaders to get on board right out of the gate.” This tracks with what the company has said, including that it has lined up new partnerships with insurance providers Ameritas and Humana.
Patel also noted that “Noyo is helping connect insurance companies and the growing ecosystem of insurtechs,” a portion of the startup market that TechCrunch has worked to track in the last year as it has raised piles of capital, seen notable liquidity and continues to drive headlines more recently.
A good question to ask startups that don’t run their cash accounts near zero before raising new funds is why they raised now. In Noyo’s case, I was curious what was the catalyzing factor for it to go out and raise more capital.
Goggin said that Noyo had found “really good signal and pickup from our early clients and partners.” That, combined with what she described as a “very clear sense of what we needed to do, and how we could accelerate bringing our future vision to life” were enough for her team to say “alright, let’s settle down, this is working, let’s be able to take the big swings.”
And thus the Series A came together.
Noyo has plans to keep hiring, with Goggin telling TechCrunch that her company is currently around 20 people, but will be around 30 by the time 2021 kicks off. She added that “the nice thing” about her new capital raise is that her startup won’t have “a staffing constraint” when it wants to “roll out a new product.”
The pace at which Noyo builds, then, should accelerate.
Which, in turn, should yield more revenue growth. Goggin cautioned that Noyo is not aiming for profitability but is, at the same time, “a real business with a viable model.” The Series A stage is generally a bit early to press founders on growth metrics, as most won’t share unless they are outlier-good. But happily, by the time that Noyo raises a Series B, it should have enough revenue history for some useful year-over-year comparisons, and we will ask for them.
The Noyo round is another data point that API-delivered startups are seeing good market traction, and that investors are taking notice. Expect to hear from a few more related companies in the next few weeks if my inbox is any indicator of what’s coming up.
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Extension rounds help some startups play offense during COVID-19
The venture capital world is constantly changing, and its evolution can sometimes flip pieces of conventional wisdom on their heads. For example, a recent flurry of extension rounds from Silicon Valley’s hottest startups like Stripe and Robinhood seem to signal that the investment type has suddenly become cool.
Extensions evolving from unloved to hot is not the first time that a type of VC deal has gained, or lost luster. In past times, for example, raising consecutive rounds from the same lead investor was often perceived as a negative signal; why couldn’t the startup find a new, different lead investor? Today, in contrast, venture capitalists are using inside rounds to double-down on winning startups, a way of helping ensure returns for their own backers.
The recent phenomenon of extensions becoming vogue is a tale of the times, in which the best startups get to play offense, and startups that can’t show accelerating growth are left behind. Let’s explore what has changed.
A series of fortunate extensions
TechCrunch first wrote about the new extension-round trend after seeing what felt like a wave of the deals crop up. Some were large, like MariaDB’s huge $25 million add-on to its Series C, or Robinhood’s biblical $320 million addition to its Series F.
But most were smaller events like Sayari adding $2.5 million to its Series B, or CALA adding $3 million to its seed round. Even more recently, Eterneva raised another $3 million on top of its seed round, and also out this week was a million pounds more for Edinburgh-based Machine Labs’ seed round.
One reason for the growth of extension rounds in 2020 has been runway — making sure that a startup has enough. Upstarts often raise on an 18-month cadence. But because of COVID-19 and its constituent economic disruptions, many have reduced costs in a bid to bolster how long they have until their cash stores reach zero.
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Ethena raises $2 million in seed funding for smarter anti-harassment software
Corporate harassment training is often defined by mandatory annual workshops, stock photo-ridden curricula and, often, outdated scenarios. Harvard graduates Roxanne Petraeus and Anne Solmssen think there’s a business in doing better than that.
The duo co-founded Ethena, a software-as-a-service startup that sells anti-harassment training software that is more comprehensive and flexible than the status quo.
Ethena sends “nudges,” or personalized short-form bits of training content, to employees throughout the year. One nudge could be about office dating, and a few weeks later, another nudge could be about mentorship.
Each month a user would get either an e-mail or Slack notification saying it is time to train. Then the user would go to a browser-based app and take a lesson, which depends on your managerial status, state of residence and other factors. The sessions would then be five to 10 minutes.
The distributed approach takes away the ability for an employee to front-load hours of training on their first week. Instead, Ethena’s consistent check-ins are aiming at a difficult metric to track: comprehension within compliance training.
“The reason we do that is because in the adult learning base it is pretty emphatic that repetition is crucial,” Petraeus said.
This format also gives the company a chance to adapt its content to the world users are living in. Ethena’s content has to follow a certain curriculum based on state law, but, it can add its own flavor. For example, when COVID-19 became a serious threat, Ethena was able to send users training in regards to online harassment and cyberbullying. Old curricula might not account for what Zoom harassment might look like.
Petraeus said of the examples users see in the software, “it makes no sense to have Jim and Jan go to a bar if that’s not the environment we are in.”
Ethena also works as a replacement for in-person anti-harassment workshops during COVID-19 and resulting shelter-in-place orders. As offices continue to remain shut down, companies need to find new ways to talk about issues that are not going away.
Efficacy of anti-harassment training is hard to track with numbers. If a company tried to measure Ethena’s efficacy with data around the number of harassment reports filed before and after the software was used, it presumes that victims are choosing to report in the first place. Victims, for a variety of reasons, often don’t report due to fear of retaliation or inaction.
For the co-founders, a lack of hard data about whether their software works meant that they had to find another way to pitch to customers.
“It would be really irresponsible to just kind of bank on ‘everyone will believe in this mission with us,’ ” said Petraeus. “We read the newspaper; that will not happen.”
Instead, the co-founders think that sweeping training regulations and legal obligations might be what force companies to onboard more intensive software.
“We keep companies in a legally, very safe position because their employees are always sort of ahead of what they need to stay compliant with state regulations,” Solmssen said. “We’re able to become a part of the fabric of everyday thinking and behavior for employees.”
Long term, Ethena is working with a peer-reviewed journal to see if effective anti-harassment training can be related to higher retention rates in companies.
The company envisions early adopters to be small companies that are scaling. It charges companies per seat, which comes out to $4 per employee per month, and $48 per employee per year.
Petraeus and Solmssen piloted the program in November 2019 and launched in January. Today, the startup told TechCrunch they have raised $2 million in seed funding led by GSV, with participation from Homebrew, Village Global and more. It has 50 customers.
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‘The best VC on Instagram’ is now VC-backed
About 18 months ago, Jenny Gyllander created an Instagram account by the name of @thingtesting.
The premise was simple. Gyllander, who was at the center of the London startup ecosystem as an investor with the British seed fund Backed.VC, would upload photos of interesting direct-to-consumer products with a caption that served as a bite-sized review. The experiment began with Birchbox, a provider of curated boxes of beauty products that rose to prominence amid the subscription box hype of yesteryear. In her short review, tailored perfectly for the Instagram generation, Gyllander admitted to being “like 10 years late to this much hyped subscription-everything party,” adding that “after two boxes and ten products, only three products were relevant to me.” Her honesty, and perhaps more importantly, her brevity, garnered her a small following of venture capitalists, founders and consumer-brand enthusiasts.
Since that first post, Gyllander has featured and reviewed more than 100 products on her Instagram account — which today counts 32,800 followers. And she quit her day job and began building an Instagram-inspired, full-fledged review business.
“I found something I am very, very passionate about,” Gyllander tells TechCrunch. “Finding the D2C niche was for me a little bit of a Holy Grail. It’s where brands and startups align for the first time in a concrete way.”
With a $300,000 pre-seed investment from angel investor and Homebrew co-founder Hunter Walk, who previously called Thingtesting “The best VC on Instagram,” early Spotify investor Shakil Khan and more, Gyllander wants to create a full-scale D2C review platform with a team of reviewers and content creators, and a portal for her loyal followers to write and submit their own reviews. She compares what she envisions for Thingtesting to that of Rotten Tomatoes. Akin to the popular website for movie and television reviews, each product review on her future website will include a Thingtesting score and an audience score. The goal is to help consumers shop smarter and filter through the D2C noise.
“People are confused right now by the sheer amount of products launching,” Gyllander said. “I want Thingtesting to be a filter for people to consume better … It’s a role department stores used to have back in the day, but nobody has really filled that role in the online world.”
Gyllander, already making money from what was once a side project, has plans in store to generate significantly more revenue. Currently, she’s capitalizing off Instagram’s Close Friends list, which the social media hub launched last year to allow users to share content to fewer people. Gyllander, like a slew of other Instagram influencers, however, quickly realized an opportunity to monetize content using the feature, a trend explained in detail in a recent report from The Atlantic.
Gyllander charges a lifetime fee of $100 to her followers hoping for a spot on her Close Friends list. Those followers are then provided exclusive content, including behind-the-scenes looks at her product review journeys. So far, 300 people have been granted access to the exclusive group as others sit on the waitlist. Gyllander explains she hasn’t green-lit every request to enter the coveted group because she wants to maintain a sense of community as the account grows in popularity. Early next year, she hopes, she will have launched a Thingtesting website and a new subscription-based membership tier targeting D2C connoisseurs, investors and anyone interested in a front-seat view of the booming D2C industry.
As Thingtesting morphs into a digital review platform and expands from the bounds of Instagram, Gyllander will have to work harder to differentiate what she’s built from other review sites and D2C blogs. Her secret weapon, she believes, is her authenticity.
“It’s my honesty,” Gyllander said. “And it’s the fact that there’s no payment involved from the brands and that I’m not being paid to review products. That’s something quite rare in the Instagram world today. There aren’t that many accounts that are just talking about new products with non-monetary incentives.”
Since launching with a review of Birchbox, Gyllander has shared her thoughts on Magic Spoon, a D2C cereal company: “one bowl kept me full for hours,” she wrote, ultimately concluding she wouldn’t continue eating the cereal. More recently, she referred to the D2C aperitif brand Haus as “stunning;” wrote a lukewarm review of the blue light-protecting eyewear brand Felix Gray; and posted a glowing summary of Dripkit, a D2C coffee brand.
To secure a spot on Gyllander’s grid, a product must bring something new to the market, as well as boast killer branding and packaging. The former VC says she tries out about 20 products a month and shares official reviews of four or five.
“The majority of people today, when it comes to modern brands, they have their first interaction through an ad or an influencer telling them about the product,” Gyllander explained. “Discovery is in a weird place right now when it comes to the general consumer.”
It’s difficult to imagine a venture-scale business within Gyllander’s vision for Thingtesting. But one should never underestimate the value of an exclusive and hyper-focused network. Gyllander, in a short time, has created a meeting place for D2C aficionados and venture capitalists and, as she’s proven, her thoughts are worth paying for.
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Unstoppable exploit in Nintendo Switch opens door to homebrew and piracy
The Nintendo Switch may soon be a haven for hackers, but not the kind that want your data — the kind that want to run SNES emulators and Linux on their handheld gaming consoles. A flaw in an Nvidia chip used by the Switch, detailed today, lets power users inject code into the system and modify it however they choose.
The exploit, known as Fusée Gelée, was first hinted at by developer Kate Temkin a few months ago. She and others at ReSwitched worked to prove and document the exploit, sending it to Nvidia and Nintendo, among others.
Although responsible disclosure is to be applauded, it won’t make much difference here: this flaw isn’t the kind that can be fixed with a patch. Millions of Switches are vulnerable, permanently, to what amounts to a total jailbreak; only new ones with code tweaked at the factory will be immune.
That’s because the flaw is baked into the read-only memory of the Nvidia Tegra X1 used in the Switch and a few other devices. It’s in the “Boot and Power Management Processor” to be specific, where a misformed packet sent during a routine USB device status check allows the connected device to send up to 64 kibibytes (65,535 bytes) of extra data that will be executed without question. You need to get into recovery mode first, but that’s easy.
As you can imagine, getting arbitrary code to run on a device that deep in its processes is a huge, huge vulnerability. Fortunately it’s only available to someone with direct, physical access to the Switch. But that in itself makes it an extremely powerful tool for anyone who wants to modify their own console.
Modding consoles is done for many reasons, and indeed piracy is among them. But people also want to do things Nintendo won’t let them, like back up their saved games, run custom software like emulators or extend the capabilities of the OS beyond the meager features the company has provided.
Temkin and her colleagues had planned to release the vulnerability publicly on June 15 or when someone releases the vulnerability independent of them — whichever came first. It turned out to be the latter, which apparently came as a surprise to no one in the community. The X1 exploit seems to have been something of an open secret.
The exploit was released anonymously by some hacker and Temkin accordingly published the team’s documentation of it on GitHub. If that’s too technical, there’s also some more plain-language chatter about the flaw in a FAQ posted earlier this month. I’ve asked Temkin for a few more details.
In addition to Temkin, failOverflow announced a small device that will short a pin in the USB connector and put the device into recovery mode, prepping it for exploitation. And Team-Xecuter was advertising a similar hardware attack months ago.
The answer to the most obvious question is no, you can’t just fire this up and start playing Wave Race 64 (or a pirated Zelda) on your Switch 15 minutes from now. The exploit still requires technical ability to implement, though as with many other hacks of this type, someone will likely graft it to a nice GUI that guides ordinary users through the process. (It certainly happened with the NES and SNES Classic Editions.)
Although the exploit can’t be patched away with a software update, Nintendo isn’t powerless. It’s likely that a modified Switch would be barred from the company’s online services (such as they are) and possibly the user’s account, as well. So although the hacking process is, compared with the soldering required for modchips of decades past, low on risk, it isn’t a golden ticket.
That said, Fusée Gelée will almost certainly open the floodgates for developers and hackers who care little for Nintendo’s official ecosystem and would rather see what they can get this great piece of hardware to do on their own.
I’ve asked Nintendo and Nvidia for comment and will update when I hear back.
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Homebrew closed $90 million fund
Homebrew is announcing the close of its third fund. This time they’ve raised $90 million, an increase from $50 million in 2015 and $35 million for its debut fund in 2013. Led by Hunter Walk and Satya Patel, the seed-stage venture firm has spent the past five years investing in U.S.-based startups at the onset. Read More
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Klout’s Joe Fernandez is back with Joymode, an equipment rental startup with a focus on experiences
Joymode is a startup for people who want to do fun things like host a backyard movie night or go on a camping trip — but don’t necessarily want to buy all the requisite equipment, especially if they’re only going to use it once. The company was founded by Joe Fernandez, Waynn Lue and Keith Walker. Fernandez previously founded social influence startup Klout and sold it to… Read More
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Doomed-i-corns: Unicorns Seemingly Reach a Tipping Point
This morning, the law firm Fenwick & West published new findings about all the U.S.-based unicorn financings that took place during the last nine months of 2015. It’s rife with interesting nuggets, but perhaps most fascinating is that in the fourth quarter of last year, half of the 12 rounds it tracked featured valuations in the $1 billion to $1.1 billion range — and with… Read More
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