Private Equity
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Vista Equity takes minority stake in Canada’s Vena with $242M investment
Vena, a Canadian company focused on the Corporate Performance Management (CPM) software space, has raised $242 million in Series C funding from Vista Equity Partners.
As part of the financing, Vista Equity is taking a minority stake in the company. The round follows $25 million in financing from CIBC Innovation Banking last September, and brings Vena’s total raised since its 2011 inception to over $363 million.
Vena declined to provide any financial metrics or the valuation at which the new capital was raised, saying only that its “consistent growth and…strong customer retention and satisfaction metrics created real demand” as it considered raising its C round.
The company was originally founded as a B2B provider of planning, budgeting and forecasting software. Over time, it’s evolved into what it describes as a “fully cloud-native, corporate performance management platform” that aims to empower finance, operations and business leaders to “Plan to Grow” their businesses. Its customers hail from a variety of industries, including banking, SaaS, manufacturing, healthcare, insurance and higher education. Among its over 900 customers are the Kansas City Chiefs, Coca-Cola Consolidated, World Vision International and ELF Cosmetics.
Vena CEO Hunter Madeley told TechCrunch the latest raise is “mostly an acceleration story for Vena, rather than charting new paths.”
The company plans to use its new funds to build out and enable its go-to-market efforts as well as invest in its product development roadmap. It’s not really looking to enter new markets, considering it’s seeing what it describes as “tremendous demand” in the markets it currently serves directly and through its partner network.
“While we support customers across the globe, we’ll stay focused on growing our North American, U.K. and European business in the near term,” Madeley said.
Vena says it leverages the “flexibility and familiarity” of an Excel interface within its “secure” Complete Planning platform. That platform, it adds, brings people, processes and systems into a single source solution to help organizations automate and streamline finance-led processes, accelerate complex business processes and “connect the dots between departments and plan with the power of unified data.”
Early backers JMI Equity and Centana Growth Partners will remain active, partnering with Vista “to help support Vena’s continued momentum,” the company said. As part of the raise, Vista Equity Managing Director Kim Eaton and Marc Teillon, senior managing director and co-head of Vista’s Foundation Fund, will join the company’s board.
“The pandemic has emphasized the need for agile financial planning processes as companies respond to quickly-changing market conditions, and Vena is uniquely positioned to help businesses address the challenges required to scale their processes through this pandemic and beyond,” said Eaton in a written statement.
Vena currently has more than 450 employees across the U.S., Canada and the U.K., up from 393 last year at this time.
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Founders who don’t properly vet VCs set up both parties for failure
There’s a disconnect between reality and the added value investors are promising entrepreneurs. Three in five founders who were promised added value by their VCs felt duped by their negative experience.
While this feels like a letdown by investors, in reality, it shows fault on both sides. Due diligence isn’t a one-way street, and founders must do their homework to make sure they’re not jumping into deals with VCs who are only paying lip service to their value-add.
Looking into an investor’s past, reputation and connections isn’t about finding the perfect VC, it’s about knowing what shaking certain hands will entail — and either being ready for it or walking away.
Entrepreneurs are increasingly demanding more than a blank check: They want mentorship, product understanding and emotional support, as well as industry connections and expertise. If VCs can’t bring that value, founders now have plenty of other funding routes to choose from, like crowdfunding, angel syndicates, tokenization and SPACs.
To stay competitive, VCs have to at least advertise that they have more than deep pockets. But what if it stops there? Founders have to know exactly what they’re looking for in a VC, which means looking past the front page and vetting their investors.
The ideal investor for modern startups is an operator VC — someone who was a founder or operator at a company before becoming an investor. But even then, ticking boxes isn’t enough to ensure the investor won’t come with their own challenges, like being too hands-on or less strategically minded.
Looking into an investor’s past, reputation and connections isn’t about finding the perfect VC, it’s about knowing what shaking certain hands will entail — and either being ready for it or walking away. There is no single solution to this issue, but here are my recommendations to founders seeking a successful investor relationship in 2021.
Have a guiding framework
No founder-investor relationship can survive misalignment. Because you share responsibility on so many processes, both parties have to be on the same page. So before you even start fundraising, nail down the expectations you need your future investor to meet. What do you need the most? What does your dream investor look like?
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2021 should be a banner year for biotech startups that make smart choices early
Last year was a record 12 months for venture-backed biotech and pharma companies, with deal activity rising to $28.5 billion from $17.8 billion in 2019. As vaccines roll out, drug development pipelines return to normal, and next-generation therapies continue to hold investor interest, 2021 is on pace to be another blockbuster year.
The median step up in valuations from seed to Series A is now 2x, higher than in all later rounds. As a result, biotech startups will continue to attract more investment at earlier stages from a larger, more diverse pool of venture capitalists.
This may also change the nature of biotech founders themselves: As a blog post from Y Combinator suggests, these founders are trending younger and perhaps less willing to cede control to VCs and hired executives than they might have in years past (i.e., via the “venture creation” model so predominant among early-stage biotech companies).
Founders are some of the most creative people out there, but legal documentation should be anything but.
As longtime members of the biotech startup community — as executives, entrepreneurs, advisors and legal counsel — we’ve seen our fair share of founder missteps early in the fundraising journey result in severe consequences.
In this exciting moment, when younger founders will likely receive more attention, capital and control than ever, it’s crucial to avoid certain pitfalls.
Clarity trumps creativity
Founders are some of the most creative people out there, but legal documentation should be anything but. Keep it as simple and clear as possible. That means using National Venture Capital Corporation documents that everyone knows and understands, as well as keeping organized documentation for employee intellectual property (IP) assignment and NDAs, option grants, independent contractor agreements, tax documents and other key contracts and paperwork.
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Fraud prevention platform Sift raises $50M at over $1B valuation, eyes acquisitions
With the increase of digital transacting over the past year, cybercriminals have been having a field day.
In 2020, complaints of suspected internet crime surged by 61%, to 791,790, according to the FBI’s 2020 Internet Crime Report. Those crimes — ranging from personal and corporate data breaches to credit card fraud, phishing and identity theft — cost victims more than $4.2 billion.
For companies like Sift — which aims to predict and prevent fraud online even more quickly than cybercriminals adopt new tactics — that increase in crime also led to an increase in business.
Last year, the San Francisco-based company assessed risk on more than $250 billion in transactions, double from what it did in 2019. The company has over several hundred customers, including Twitter, Airbnb, Twilio, DoorDash, Wayfair and McDonald’s, as well a global data network of 70 billion events per month.
To meet the surge in demand, Sift said today it has raised $50 million in a funding round that values the company at over $1 billion. Insight Partners led the financing, which included participation from Union Square Ventures and Stripes.
While the company would not reveal hard revenue figures, President and CEO Marc Olesen said that business has tripled since he joined the company in June 2018. Sift was founded out of Y Combinator in 2011, and has raised a total of $157 million over its lifetime.
The company’s “Digital Trust & Safety” platform aims to help merchants not only fight all types of internet fraud and abuse, but to also “reduce friction” for legitimate customers. There’s a fine line apparently between looking out for a merchant and upsetting a customer who is legitimately trying to conduct a transaction.
Sift uses machine learning and artificial intelligence to automatically surmise whether an attempted transaction or interaction with a business online is authentic or potentially problematic.
Image Credits: Sift
One of the things the company has discovered is that fraudsters are often not working alone.
“Fraud vectors are no longer siloed. They are highly innovative and often working in concert,” Olesen said. “We’ve uncovered a number of fraud rings.”
Olesen shared a couple of examples of how the company thwarted fraud incidents last year. One recently involved money laundering through donation sites where fraudsters tested stolen debit and credit cards through fake donation sites at guest checkout.
“By making small donations to themselves, they laundered that money and at the same tested the validity of the stolen cards so they could use it on another site with significantly higher purchases,” he said.
In another case, the company uncovered fraudsters using Telegram, a social media site, to make services available, such as food delivery, with stolen credentials.
The data that Sift has accumulated since its inception helps the company “act as the central nervous system for fraud teams.” Sift says that its models become more intelligent with every customer that it integrates.
Insight Partners Managing Director Jeff Lieberman, who is a Sift board member, said his firm initially invested in Sift in 2016 because even at that time, it was clear that online fraud was “rapidly growing.” It was growing not just in dollar amounts, he said, but in the number of methods cybercriminals used to steal from consumers and businesses.
“Sift has a novel approach to fighting fraud that combines massive data sets with machine learning, and it has a track record of proving its value for hundreds of online businesses,” he wrote via email.
When Olesen and the Sift team started the recent process of fundraising, Insight actually approached them before they started talking to outside investors “because both the product and business fundamentals are so strong, and the growth opportunity is massive,” Lieberman added.
“With more businesses heavily investing in online channels, nearly every one of them needs a solution that can intelligently weed out fraud while ensuring a seamless experience for the 99% of transactions or actions that are legitimate,” he wrote.
The company plans to use its new capital primarily to expand its product portfolio and to scale its product, engineering and sales teams.
Sift also recently tapped Eu-Gene Sung — who has worked in financial leadership roles at Integral Ad Science, BSE Global and McCann — to serve as its CFO.
As to whether or not that meant an IPO is in Sift’s future, Olesen said that Sung’s experience of taking companies through a growth phase such as what Sift is experiencing would be valuable. The company is also for the first time looking to potentially do some M&A.
“When we think about expanding our portfolio, it’s really a buy/build partner approach,” Olesen said.
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With $30M extension, BigID boosts Series D to $100M at $1.25B valuation
When we last heard from BigID at the end of 2020, the company was announcing a $70 million Series D at a $1 billion valuation. Today, it announced a $30 million extension on that deal valuing the company at $1.25 billion just four months later.
This chunk of money comes from private equity firm Advent International, and brings the total raised to more than $200 million across four rounds, according to the company. The late-stage startup is attracting all of this capital by building a security and privacy platform. When I spoke to CEO Dimitri Sirota in September 2019 at the time of the $50 million Series C, he described the company’s direction this way:
We’ve separated the product into some constituent parts. While it’s still sold as a broad-based [privacy and security] solution, it’s much more of a platform now in the sense that there’s a core set of capabilities that we heard over and over that customers want.
Sirota says he has been putting the money to work, and as the economy improves he is seeing more traction for the product set. “Since December, we’ve added employees as we’ve seen broader economic recovery and increased demand. In tandem, we have been busy building a whole host of new products and offerings that we will announce over the coming weeks that will be transformational for BigID,” he said.
He also said that as with previous rounds, he didn’t go looking for the additional money, but decided to take advantage of the new funds at a higher valuation with a firm that he believes can add value overall. What’s more, the funds should allow the company to expand in ways it might have held off on.
“It was important to us that this wouldn’t be a distraction and that we could balance any funding without the need to over-capitalize, which is becoming a bigger issue in today’s environment. In the end, we took what we thought could bring forward some additional product modules and add a sales team focused on smaller commercial accounts,” Sirota said.
Ashwin Krishnan, a principal on Advent’s technology team in New York, says that BigID was clearly aligned with two trends his firm has been following. That includes the explosion of data being collected and the increasing focus on managing and securing that data with the goal of ultimately using it to make better decisions.
“When we met with Dimitri and the BigID team, we immediately knew we had found a company with a powerful platform that solves the most challenging problem at the center of these trends and the data question,” Krishnan said.
Past investors in the company include Boldstart Ventures, Bessemer Venture Partners and Tiger Global. Strategic investors include Comcast Ventures, Salesforce Ventures and SAP.io.
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Announcing our TC Sessions: SaaS virtual event happening October 27
Software-as-a-service (SaaS) is now the default business model for most B2B and B2C software startups. And while it’s been around for a while now, its momentum keeps accelerating and the ecosystem continues to expand as technologists and marketers are getting more sophisticated about how to build and sell SaaS products. For all of them, we’re pleased to announced TechCrunch Sessions: SaaS 2021, a one-day virtual event that will examine the state of SaaS to help startup founders, developers and investors understand the state of play and what’s next.
The single-day event will take place 100% virtually on October 27 and will feature actionable advice, Q&A with some of SaaS’s biggest names and plenty of networking opportunities. Importantly, $75 Early Bird passes are now on sale. Book your passes today to save $100 before prices go up.
We’re not quite ready to disclose our agenda yet, but you can expect a mix of superstars from across the industry, ranging from some of the largest tech companies to up-and-coming startups that are pushing the limits of SaaS.
The plan is to look at a broad spectrum of what’s happening with B2B startups and give you actionable insights into how to build and/or improve your own product. If you’re just getting started, we want you to come away with new ideas for how to start your company, and if you’re already on your way, then our sessions on scaling both your technology and marketing organization will help you to get to that $100 million annual run rate faster.
In addition to other founders, you’ll also hear from enterprise leaders who decide what to buy — and the mistakes they see startups make when they try to sell to them.
But SaaS isn’t only about managing growth — though ideally, that’s a problem founders will face sooner or later. Some of the other specific topics we will look at are how to keep your services safe in an ever-growing threat environment, how to use open source to your advantage and how to smartly raise funding for your company.
We will also highlight how B2B and B2C companies can handle the glut of data they now produce and use it to build machine learning models in the process. We’ll talk about how SaaS startups can both do so themselves and help others in the process. There’s nary a startup that doesn’t want to use some form of AI these days, after all.
And because this is 2021, chances are we’ll also talk about building remote companies and the lessons SaaS startups can learn from the last year of working through the pandemic.
Don’t miss out. Book your $75 Early Bird pass today and save $100.
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Do you fit the mold for the next generation of values-driven VCs?
More individuals than ever are donning the investor cap. Almost a fifth of U.S. equity trading in 2020 was driven by mom-and-pop investors — up from around 15% in the previous year. With such impressive returns to be made, many are deciding to set up a full-fledged investment business.
With the fundraising world becoming more democratic and accessible, we should help people find the right path to setting up a venture capital firm and also make sure the right people are entering the VC sphere. Startups are changing, and any new investment manager will have to adapt to the shifting landscape. VCs today have to provide more than money to get the best portfolio, and they must have a strong focus on impact to get the best institutional investors into their funds.
Startup investors can be the financial backbone for mass disruption. That’s why, at Founder Institute, we believe in the need for more VCs with strong values: Because they will prop up the companies that will build a brighter future for humanity. We’re not the only ones — our first “accelerator for ethical VCs” was oversubscribed.
VCs today have to provide more than money to get the best portfolio, and they must have a strong focus on impact to get the best institutional investors into their funds.
So if you want to lead your own VC fund in 2021, here are the main questions aspiring investors need to ask themselves.
Are you doing this for the right reasons?
Investing in startups is not just about making money. In selecting the startups that will become future industry leaders, VCs have a lot more power than most to do good (or harm). If you’re only interested in money, you likely won’t go too far. Identifying the greatest businesses means seeing beyond their capital into the longevity of their vision, their real-life impact on society, and how much consumers will love or hate them.
After all: Most startup founders pour their blood, sweat and tears into building a business not just to make money, but also to make an impact on the world and build products that align with their mission. Any new venture capitalist looking to attract the best founders needs to think about the vision and mission of their fund in the same terms.
Although VC firms have been slow on the uptake when it comes to environmental, social and governance (ESG) goals, there are signs that times are changing. Some firms are forming a community around implementing ESG, not only because of the external impact but because it furthers their business goals. To help accelerate this trend, we asked our VC Lab participants to take The Mensarius Oath (Latin for “banker” or “financier”), a professional code of conduct for finance professionals to create an ethical, prosperous and healthy world.
What value do you bring to the table?
The number of VCs are growing and the industry is increasingly becoming concentrated. This means that simply offering large sums of money won’t get you traction with the best startups. Founders are looking for value over volume — they usually want mission alignment, connections, value-added services and industry expertise more than a blank check.
Remember that the best founders get to choose their VCs from a menu of options, not the other way around. To convince them that you’re the right match, you’ll need a proven track record in the same industry (or transferable experience from another industry) and referrals from credible people. You’ll also need a strong value proposition or niche that sets you apart from other funds. For example, Untapped Capital invests in “unexpected” and “undernetworked” founders, while R42 Group invests in AI and longevity-focused businesses.
If you don’t think you’ve got the profile to offer value to founders just yet, it’s worth taking some time to lay out exactly who you are. That is: what you hope to achieve as a fund manager, the vision you have for your portfolio companies and how you alone can help them get there.
What’s your secret sauce?
As a new VC fund without historical data points, limited partners (LPs) will naturally be cautious to invest in your fund. So, you have to build a brand that tells your story and proves your reputation.
Go back to the basics and pinpoint exactly what your strengths are. If you’re having trouble finding inspiration, use statements like, “I can get the best deal because I have X,” or, “I help grow my portfolio companies by X” to get the ball rolling. Be wary of saying that the amount of money you have is your strength — at this stage, your bank balance isn’t your competitive edge. Focus instead on what makes you unique, credible and relevant. Having a high number of strategic contacts, extensive industry experience or a backsheet of successful exits could be your secret ingredients. For extra guidance, check out this resource my team put together to help fund managers consolidate their niche in an “investment thesis.”
Once you have a list, choose your top three strengths and write a followup sentence detailing how each of them can be enriched by your network and expertise. Ideally, share these with a test group (friends, family or fellow entrepreneurs) and ask them which is the most compelling. If there’s a general consensus toward one point, you know to make that a large chunk of your VC fund’s thesis.
Do you have a solid network?
Who you know is just as important as what you know, and the most prominent VCs tend to be in the middle of a flow of information and people. Your network tells founders that you’re respected and reassures them that they will probably be brought into the fold to connect with future mentors, customers, investors or hires.
If you’re a thought leader, the alumni of a well-known company like Uber or PayPal, or if you’ve started a community around an emerging vertical, you’re more likely to form a positive deal flow. But this status and these relationships have to be established before you launch your fund — if you try to network from zero, you’ll be spinning too many plates and won’t have the social proof to back yourself up.
Don’t just rely on your gut to tell you whether your network is satisfactory. Map out your personal ecosystem, sorting people based on familiarity (close contacts or acquaintances) and defining characteristics (consumers, finance, ex-CEOs, etc.). That “map” can be as basic as an Excel sheet with a column for each category, or you could use more attractive visual tools like Canva — great for sharing with your future team and encouraging them to fill any network gaps.
What size fund do you want to launch?
A VC fund runs like any other business — you have to develop a vision, recruit a team, form an entity, raise money, deliver value and report to stakeholders. To kick things off, you need to consider what size fund you want, and then secure significant commitments from LPs — at least 10% of your total fund. LPs can be corporations, entrepreneurs, government agencies and other funds.
Also keep in mind that most LPs will want you to personally invest at least 1% of the total fund size so that you have “skin in the game.”
For that reason especially, it’s best to start small, somewhere between $5 million and $20 million, and use this “training fund” to demonstrate returns and create a launchpad for bigger raises to follow.
Can you help founders from launch to exit?
Your partnership with companies will be for the long haul, so you can’t rely just on offering value when you wire the money. Founders need consistent support across the full startup lifecycle, meaning you need to be conscious not to overpromise and fail to deliver. Think of the startups you’d most like to work with: How could you help them now? How could you help them in the future? And how could you help them exit?
You can take a skills-centric approach, where you reserve different resources and connections based on marketing, hiring, fundraising and culture-creation that can be applied as the startup grows. Alternatively, you might want to make sprint-like plans, where you check in with founders on a repeating basis and iterate the support you offer based on their progress. Whatever way you chose to structure your support, ensure that you’re realistic about what you can bring to the table, your availability, preferred involvement and how you’ll document it.
The future of VC will be driven by venture capitalists with strong values who have built funds with the new needs of founders in mind. VC may once have been exclusive and mysterious, but 2021 could be the year VC becomes a more open and fair space for businesses and investors alike.
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Inside the US’ epic first-quarter venture capital results
It’s no surprise that the venture capital market was incredibly active in the United States during the first quarter of 2021, but precisely how strong has only recently become clear. This morning, we’re digging into the data.
According to a report from PitchBook, venture capitalists unleashed a wave of capital in the first three months of the year. So much, in fact, that funding in the United States nearly doubled compared to the same quarter of 2020.
We’ll dig into specific numbers and trends regarding aggregate venture capital results in a moment, but what stood out the most while digesting the Q1 dataset was how strong VC results appeared across different states; a solo late-stage boom the quarter was not.
Seed deal volume appeared strong and early-stage venture capital activity could reach new highs in 2021, but late-stage venture capital activity in the United States is already setting records in both deal count and invested dollars.
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We’ll parse the headline numbers and then dive into seed and super late-stage data with the help of Sarah Kunst of Cleo Capital, Jenny Lefcourt of Freestyle Capital, Iris Choi of Floodgate and Laela Sturdy of CapitalG.
With their help, we’ll contextualize the numbers and weave anecdotal observations into what the charts and graphs tell us. Especially in the case of seed data, which is famously laggy, added context is crucial. Let’s go!
A Q1 overview
According to PitchBook’s report, some 3,987 venture capital rounds were closed in the United States during Q1 2021. Those deals were worth $69 billion, a figure up nearly 93% from 2020’s first-quarter results.
In broad strokes, the United States had a crushing venture capital start to the new year, pandemic be damned. That is especially true when we consider 2020’s full-year figures. Last year, venture capitalists deployed some $166 billion into U.S.-based startups across 12,546 rounds. In contrast, if the first quarter’s pace was maintained during the rest of 2021, the United States would see around 16,000 rounds worth around $280 billion.
Of course, we cannot see the future, so those projections are merely shared to underscore how active the first quarter proved to be; we’ll have to wait for at least another quarter’s data to confidently predict full-year records for 2021.
Powering the rapid start to the venture capital year was a holistic boom: Seed deal volume is forecasted to have set a multiyear high, perhaps matching the historically strong Q2 2018 period. Early-stage venture capital during Q1 2021 was also robust, with $14.5 billion deployed across 1,170 rounds. Both numbers set a pace for fresh records in 2021.
Then there was late-stage dealmaking, which soared in the first quarter. In 2020, late-stage venture capital deals were worth $111.4 billion raised from 3,504 rounds. In the first quarter of 2021, some $51.9 billion was invested into late-stage startups across 1,291 deals.
Valuations and round sizes continued to rise across the board. If there was a better time to raise a big whack of venture capital as a U.S.-based startup, we cannot recall it. And the data seems to scream that the good times are now as good, or gooder, than ever.
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With a team that helped build the brain behind Alexa, HomeX raises $90M
HomeX, a home services platform for homeowners and service providers, has raised $90 million in a funding round led by New Mountain Capital.
New Mountain Capital, a New York-based investment firm with more than $30 billion in assets under management, was the only institutional investor to put money in this round alongside company executives. The company was bootstrapped until a 2019 $50 million-plus debt financing.
Founded in 2017, Chicago-based HomeX aims to “radically improve” home services by pairing service workers with homeowners, both virtually and in person. It also has built software, and offers services for, contractors that are aimed at helping them drive and manage demand “more efficiently.”
Notably, one of the company’s co-founders, CTO Simon Weaver, and several team members were on the development team of Evi, a startup that had built an AI program that can be communicated with using natural language via an app, that was acquired by Amazon in 2012. That technology was essentially the brain behind Amazon’s virtual assistant Alexa.
HomeX uses artificial intelligence to diagnose home issues virtually before a contractor even goes out to a home, with the goal of helping them resolve a problem faster (by having the necessary equipment ahead of time for example), which in turn makes customers happier.
“We’re using machine-generated content to create solutions that are specific to a homeowner’s issues,” said co-founder and president Vincent Payen. “Using machines to understand symptoms, the questions to ask and to actually get to a diagnosis and a recommendation or resolution is where AI absolutely shines and allows us to do things that were not possible even three or five years ago.”
Founder and CEO Michael Werner worked in the $500 billion services industry for years (his family founded Werner Ladders) and recognized just how fragmented it was. He also acknowledges that, especially in certain markets, “there’s a terrible imbalance between very high demand and not enough contractors to do the work, or rather, a terrible labor shortage.”
HomeX Remote Assist in particular virtually connects homeowners (via phone, video or chat) with HomeX’s licensed technicians to diagnose and repair common home issues. That business unit has experienced more than 400% growth in less than a year, according to Werner. Last year, the company grew by “about 5x” the number of contractors on its platform. It declined to reveal revenue figures.
Image courtesy of HomeX
“For homeowners, we’re making home maintenance less complicated,” Werner said. “At the same time, we want to help the contractor succeed. Similar to how telemedicine has changed how medicine is delivered, HomeX Remote Assist is going to change the service experience for taking care of your home.”
Another area of HomeX’s business that is growing rapidly is its B2B offering. Home warranty and insurance companies see remote services “as very additive to make their business more efficient,” notes Payen.
“We are using some of our capital toward a pilot program and a number of business development opportunities there,” he said.
For now, while the company is not profitable overall, it is profitable in the services side of its business, according to Werner. In the last 12 months alone, it has served “hundreds of thousands” of clients via its platform, defined by unique virtual and physical appointments.
New Mountain Capital Managing Director Harris Kealey said his firm viewed HomeX as a business that is primed to reshape the home and commercial services industry.
“The market is massive and the need for change and innovation is substantial,” he said in a written statement.
Another company in the space, Thumbtack, recently expanded into video home checkups. Thumbtack, a marketplace where you can hire local professionals for home improvement and other services such as repairs, in December acquired Setter, a startup which provided its customers with video home checkups conducted by experts, and then offered personalized plans for how to address any issues.
Thumbtack had laid off 250 employees at the end of March 2020, after the company saw big declines in its major markets. Since then, however, CEO Marco Zappacosta told TechCrunch there’s been “a renewed focus on the home and an acceleration of digital adoption.”
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Extra Crunch roundup: StockX EC-1, Early Stage recaps, unpacking Alkami’s IPO, more
Over the last few days, we’ve published several articles recapping panels from last week’s TechCrunch Early Stage virtual conference.
Each story is based on an interview with a founder or investor who addressed some of the most common startup dilemmas. Predictably, they’re mostly focused on the how and why:
How do I get into an accelerator? When should I hire a sales team? What’s the best way to earn attention from investors?
TechCrunch reporter Natasha Mascarenhas interviewed Kleiner Perkins partner Bucky Moore to get sector-agnostic advice for founders who are ready to raise a Series A.
Their conversation isn’t a rehash of basic best practices — Moore says the pandemic has fundamentally changed the way he does business: “I actually believe that first meetings over Zoom are here to stay; I think it’s far more efficient.”
I’m looking forward to the eventual return of live TechCrunch events, but each Early Stage recap includes video and a complete transcript. As ever, full articles are available for Extra Crunch members.
Thanks very much for reading — I hope you have a fantastic weekend.
Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist
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Use discount code ECFriday to save 20% off a one- or two-year subscription
The StockX EC-1
Image Credits: Nigel Sussman
Have you ever bought a pig in a poke?
It’s a saying from medieval times: A farmer traveling on an unfamiliar road agrees to buy a baby pig in a bag from a passing stranger. Unfortunately, when the farmer gets back to their hut and opens the sack, there’s a kitten inside.
The risk of getting stuck with a counterfeit item when buying online is real, especially when it comes to sneakers, jewelry and other designer products. That’s why online marketplace StockX created a rigorous product verification and authentication process.
To date, its users have conducted more than 10 million transactions for sneakers, handbags, streetwear, watches and other high-end items that are often produced in limited quantities.
StockX’s prices are regulated and all transactional data is transparent, factors that have combined to help the platform reach a $2.8 billion valuation.
In a four-part series that dropped this week, Extra Crunch analyzes this “foundational new category of market” that began as a hobbyist’s sneaker price chart.
- Part 1: How StockX became the stock market of hype
- Part 2: Authentication and StockX’s global arms race against fraudsters
- Part 3: Where StockX fits in the business of sneakers
- Part 4: The consequences of scaling up sneaker culture
Will Topps’ SPAC-led debut expand the bustling NFT market?
Image Credits: Nigel Sussman (opens in a new window)
Yes, the baseball card company is going public in a debut that could easily be read as a way to put money into the NFT craze without actually having to buy cryptocurrencies.
Digging into the Alkami Technology IPO
Image Credits: Nigel Sussman (opens in a new window)
It appears that the slowdown in tech debuts is not a complete freeze; despite concerning news regarding the IPO pipeline, some deals are chugging ahead.
Alkami Technology joins a list that includes Coinbase’s impending direct listing and Robinhood’s expected IPO.
Texas-based Alkami Technology is a software company that delivers its product to banks via the cloud, so it’s not a legacy player scraping together an IPO during boom times.
Let’s dig into the latest SEC filing from the software unicorn.
Chinese startups rush to bring alternative protein to people’s plates
Image Credits: TechCrunch
Last year could well have been the dawn of alternative protein in China. More than 10 startups raised capital to make plant-based protein for a country with increasing meat demand. Of these, Starfield, Hey Maet, Vesta and Haofood have been around for about a year; ZhenMeat was founded three years ago; and Green Monday is a nine-year-old Hong Kong firm pushing into mainland China.
The competition intensified further last year when American incumbents Beyond Meat and Eat Just entered China.
Although some investors worry the sudden boom of meat-substitute startups could turn into a bubble, others believe the market is far from saturated.
LG’s exit from the smartphone market comes as no surprise
Image Credits: Joan Cros/NurPhoto/Getty Images
For those who follow the space, LG will be remembered fondly as a smartphone trailblazer. For well over a decade, the company was a major player in the Android category and a driving force behind a number of innovations that have since become standard.
LG continued pushing envelopes — albeit to mixed effect. But in the end, the company just couldn’t keep up.
This week, the South Korean electronics giant announced it will be getting out of the “incredibly competitive” category, choosing instead to focus on its myriad other departments.
Giving EV batteries a second life for sustainability and profit
Image Credits: Getty Images
Electric cars and trucks seem to have everything going for them: They don’t produce tailpipe emissions, they’re quieter than their fossil-fuel-powered counterparts and the underlying architecture allows for roomier and often sleeker designs.
But the humble lithium-ion battery powering these cars and trucks leads a difficult life. Irregular charging and discharge rates, intense temperatures and many partial charge cycles cause these batteries to degrade in the first five to eight years of use, and, eventually, they end up in a recycling facility.
Instead of sending batteries straight to recycling for raw material recovery — and leaving unrealized value on the table — startups and automakers are finding ways to reuse batteries as part of a small and growing market.
How to kick the 10 worst startup habits with Fuel Capital’s Leah Solivan
Image Credits: Meg Messina
Fuel Capital General Partner Leah Solivan joined us at TechCrunch Early Stage 2021 to explain how to avoid early mistakes in building your startup.
Solivan has ample experience on both sides of the fence, as she founded TaskRabbit and led it to exit through an acquisition by Ikea in 2017. She shared a list of 10 things to avoid in total, but here are some highlights of what to watch out for.
How founders can avoid blind spots and make better decisions with EchoVC’s Eghosa Omoigui
Image Credits: miodrag ignjatovic / Getty Images
Eghosa Omoigui, the founder and managing general partner of EchoVC Partners, has helped entrepreneurs navigate the first steps of starting a company and laying the right foundation early on.
Omoigui advocates for founders to develop their own All-22 tape — a tool used by professional football coaches that allows the viewer to see all 22 players on the field at the same time. It improves a coach’s line of sight, and, most importantly, helps avoid missing a critical motion or player.
The concept of this tool can — and should — be applied in the startup world as well, Omoigui said during the virtual TC Early Stage event. He explained what it means to have an All-22 tape and the steps founders should take to develop a skill set that will allow them to see and understand the playbook from all sides.
Building and leading an early-stage sales team with Zoom CRO Ryan Azus
Image Credits: Zoom Video Communications, Inc.
This year at Early Stage, TechCrunch spoke with Zoom Chief Revenue Officer Ryan Azus about building an early-stage sales team.
Azus is perhaps best known for leading the video-calling giant’s income arm during COVID-19, but his experience building RingCentral’s North American sales organization from the ground up made him the perfect guest to chat with about building an early-stage sales team.
We asked him about when founders should step aside from leading their startup’s sales org, how to build a working sales culture, hiring diversely, how to pick customer segments and how to build a playbook.
The dos and don’ts of bug bounty programs with Katie Moussouris
Image Credits: Bryce Durbin / TechCrunch
Katie Moussouris has been in cybersecurity circles since some of the world’s biggest tech companies were startups, and helped to set up the first vulnerability disclosure and bug bounty programs.
Moussouris, who runs consultancy firm Luta Security, now advises companies and governments on how to talk to hackers and what they need to do to build and improve their vulnerability disclosure programs.
At TC Early Stage, Moussouris explained what startups should (and shouldn’t) do, and what priorities should come first.
Start your engines, TechCrunch is (virtually) headed to Detroit
Join us on our next (virtual) field trip to Southeast Michigan. All lights will be shining on the Motor City.
Why Detroit? This is where StockX and Rivian call home, along with a growing stable of medical technology companies, fintech startups and security companies. The area is quickly transforming thanks to active investors, low cost of living and access to amazing universities that have a long history of supporting entrepreneurs.
If you’re interested in what’s happening in Detroit in general, are seeking out a new up-and-coming city to live in, or looking for cool companies and talented founders to invest in, then you’ll want to register and drop Thursday, April 15, on your calendar.
How to get into a startup accelerator
Image Credits: Techstars
Should you try to get your company into an accelerator? How far along should your idea and your team be before applying? When it is time to apply, how do you make your application stand out from hundreds or thousands of others? How fancy do you need to get with the application video?
For answers, we spoke with Neal Sáles-Griffin, managing director of Techstars Chicago and an adjunct professor at Northwestern University. He’s got an incredible wealth of knowledge about all things startups.
Understanding how fundraising terms can affect early-stage startups
Image Credits: Fenwick
Fenwick & West partner (and business lawyer) Dawn Belt joined us at TechCrunch Early Stage to break down some of the terms that trip up first-time entrepreneurs.
Belt has been involved in a number of key Silicon Valley moves, including EV company Proterra’s recent decision to go public via SPAC, as well as IPOs for Bill.com and Facebook. Here, she discusses key concepts like equity and the right of first refusal, and the role they play in the early stages of startup funding.
Bootstrapping, managing product-led growth and knowing when to fundraise
Image Credits: Calendly / OpenView
Product-led growth is all the rage in the Valley these days, and we had two leading thinkers discuss how to incorporate it into a startup at TechCrunch Early Stage 2021.
Tope Awotona is the CEO and founder of Calendly, which bootstrapped for much of its existence before raising $350 million at a $3 billion valuation from OpenView and Iconiq. And on the other side of that table (and this interview) sat Blake Bartlett, a partner at OpenView who has been leading enterprise deals based around the principles of efficient growth.
The two talked about bootstrapping and product-led growth, expanding internationally, when to bootstrap and when to fundraise, and how VCs approach a profitable company (carefully, and with a big stick). Oh, and how to spend $350 million.
Four strategies for getting attention from investors
Image Credits: MaC Venture Capital
Being a successful early-stage investor is about a lot more than simply identifying trends; a successful VC needs to think several steps ahead. For MaC Venture Capital founder Marlon Nichols, it’s an ability that’s helped him spot big names like Gimlet Media, MongoDB, Thrive Market, PlayVS, Fair, LISNR, Mayvenn, Blavity and Wonderschool early on.
Nichols joined us on TechCrunch Early Stage to discuss his strategies for early-stage investing and how those lessons can translate into a successful launch for budding entrepreneurs.
Setting up a management board for success with Dave Easton
Image Credits: Generation Investment Management
Viewed from the outside, board selection and corporate governance can seem like a bit of a black box — particularly at a startup.
Generation Investment Management partner Dave Easton spoke at TechCrunch Early Stage about how to build a board as a founder, and, specifically, how to build a board you can live with. Easton’s experience serving on boards as both a full member and as an observer helped peel back the curtain on the murky topic of good governance.
Founder and investor Melissa Bradley outlines how to nail your virtual pitch meeting
Image Credits: Ureeka
Zoom-based pitch meetings became standard during the pandemic, but many investors say they intend to maintain the practice as more people are vaccinated.
In conversation with Jordan Crook, founder, investor, and business school professor Melissa Bradley offered pointers for how founders can prepare for Zoom calls, common pitfalls to avoid, and how to allocate time during the meeting.
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