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Tecton.ai emerges from stealth with $20M Series A to build machine learning platform
Three former Uber engineers, who helped build the company’s Michelangelo machine learning platform, left the company last year to form Tecton.ai and build an operational machine learning platform for everyone else. Today the company announced a $20 million Series A from a couple of high-profile investors.
Andreessen Horowitz and Sequoia Capital co-led the round with Martin Casado, general partner at a16z and Matt Miller, partner at Sequoia joining the company board under the terms of the agreement. Today’s investment combined with the seed they used to spend the last year building the product comes to $25 million. Not bad in today’s environment.
But when you have the pedigree of these three founders — CEO Mike Del Balso, CTO Kevin Stumpf and VP of Engineering Jeremy Hermann all helped build the Uber system — investors will spend some money, especially when you are trying to solve a difficult problem around machine learning.
The Michelangelo system was the machine learning platform at Uber that looked at things like driver safety, estimated arrival time and fraud detection, among other things. The three founders wanted to take what they had learned at Uber and put it to work for companies struggling with machine learning.
“What Tecton is really about is helping organizations make it really easy to build production-level machine learning systems, and put them in production and operate them correctly. And we focus on the data layer of machine learning,” CEO Del Balso told TechCrunch.
Image Credit: Tecton.ai
Del Balso says part of the problem, even for companies that are machine learning-savvy, is building and reusing models across different use cases. In fact, he says the vast majority of machine learning projects out there are failing, and Tecton wanted to give these companies the tools to change that.
The company has come up with a solution to make it much easier to create a model and put it to work by connecting to data sources, making it easier to reuse the data and the models across related use cases. “We’re focused on the data tasks related to machine learning, and all the data pipelines that are related to power those models,” Del Balso said.
Certainly Martin Casado from a16z sees a problem in search of a solution and he likes the background of this team and its understanding of building a system like this at scale. “After tracking a number of deep engagements with top ML teams and their interest in what Tecton was building, we invested in Tecton’s A alongside Sequoia. We strongly believe that these systems will continue to increasingly rely on data and ML models, and an entirely new tool chain is needed to aid in developing them…,” he wrote in a blog post announcing the funding.
The company currently has 17 employees and is looking to hire, particularly data scientists and machine learning engineers, with a goal of 30 employees by the end of the year.
While Del Balso is certainly cognizant of the current economic situation, he believes he can still build this company because he’s solving a problem that people genuinely are looking for help with right now around machine learning.
“From the customers we’re talking to, they need to solve these problems, and so we don’t see things slowing down,” he said.
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Attentive raises another $40M for mobile messaging, will invest in helping customers respond to COVID-19
Mobile messaging startup Attentive continues to bring in new funding.
The startup raised a $40 million Series B last summer, followed by a $70 million Series C at the beginning of this year. Today it’s announcing that it’s extended the Series C by another $40 million, bringing the total round size to $110 million.
CEO Brian Long (who previously founded TapCommerce with his Attentive co-founder Andrew Jones and sold the company to Twitter) told me that the new funding closed just a week ago. He said the money comes from institutional investors who had wanted to participate in the Series C, but “for whatever reason, the timing didn’t work out.”
Then, as the startup wanted to invest in new areas — particularly in response to the COVID-19 pandemic — Long reached out again. Once they saw Attentive’s numbers for the first quarter of 2020, the firms were willing to invest.
Apparently, the number of new customer sign-ups is only increasing, with Attentive now working with more than 1,000 businesses. Companies like Coach, Urban Outfitters, CB2, PacSun, Lulus and Jack in the Box use the platform to manage their mobile messaging, with tools around adding text message subscribers, creating engaging messages and tracking the results of those campaigns.
And while we’re at the beginning of what’s likely to be a dramatic slowdown in advertising and marketing, Long suggested that even if businesses pull back on acquiring new customers, they’ll still need to maintain a relationship with existing ones.
“CRM is such a critical channel for companies … email and text are the last thing you would shut down,” he said.
Sequoia Capital Global Equities and Coatue are the new investors in the Series C. Sequoia’s venture fund already led (or co-led) the Series C and the Series B, but Long said he was interested in working with the firm’s crossover fund — and with Coatue — partly because they invest in public companies as well.
Not that he has immediate plans for Attentive to go public, but he said, “It just creates optionality,” so that there are fewer financial pressures regardless of the route the company takes.
Other investors in the Series C include IVP, Bain Capital Ventures, NextView Ventures, Eniac Ventures and High Alpha.
“Attentive’s rapid growth is an indicator of how consumers are eager to find a more direct, personalized and efficient channel to interact with businesses,” said Jeff Wang, managing partner at Sequoia Capital Global Equities, in a statement. “We’ve been impressed by how quickly Attentive’s business has scaled, its strong customer momentum, and the expertise of the team. We are thrilled to increase Sequoia’s partnership with Attentive through our Global Equities fund.”
As for how Attentive is responding to COVID-19, the startup plans to create funds to help customers navigate the economic fallout. There will be more details released in the coming weeks, but Long said the idea is to launch funds focused on the e-commerce/retail, food/beverage and educational sectors, providing free access to Attentive tools and services “to help those companies get recharged.”
Long added that he hopes to grow Attentive’s headcount from 260 employees to more than 400 by the end of this year.
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Startups, VCs in India request ‘relief package’ from the government to fight coronavirus disruption
More than six dozen startup founders, venture capitalists and lobby groups in India have requested the government to grant them a “robust relief package” to help combat severe disruptions their businesses face due to the coronavirus outbreak.
In a joint letter to India’s Prime Minister Narendra Modi, startups requested the government to bankroll 50% of their workforce’s salaries for six months, provide interest-free loans from banks, waive rent for three months and offer tax benefits among other things.
“Unfortunately, our startup companies across the nation are inherently young, less resilient and most vulnerable. Many of them face likely devastation during this extraordinary economic downturn. At this dire moment, Indian startups need a robust relief package from the government, lest all our collective efforts of the past few years are in vain,” they wrote.
Among those who have signed the letter include Mohit Bhatnagar, a managing director at Sequoia Capital, which is in advanced stages to close a fresh $1.3 billion fund for India and Southeast Asia, Gaurav Agarwal of online medicine store 1mg, Debjani Ghosh of industry body Nasscom, Karthik Reddy of Blume Ventures, Anand Lunia of India Quotient, Deepinder Goyal of Zomato, and Sriharsha Majety of Swiggy.
Some prominent startup founders and VCs including Vijay Shekhar Sharma of Paytm, and Ritesh Agarwal of Oyo, have also held a meeting with Piyush Goyal, the commerce minister in India, for a similar relief.
“We seek your urgent intervention to help ensure India’s startup ecosystem survives this crisis to emerge as a pillar of growth, employment and innovation to help drive India’s recovery. We need the startup ecosystem to survive in order to help the economy bounce back. We have enclosed herewith our submission for your kind consideration and we look forward to your support in this regard,” the joint letter reads.
The request for bailout comes amid a national lockdown in India that has disrupted countless businesses. New Delhi ordered a 21-day lockdown last month in a bid to curtail the spread of Covid-19.
Earlier this month, ten prominent VC and PE funds in India cautioned startups to brace for the “worst” months ahead.
“Assumptions from bull market financings or even from a few weeks ago do not apply. Many investors will move away from thinking about ‘growth at all costs’ to ‘reasonable growth with a path to profitability.’ Adjust your business plan and messaging accordingly,” they said.
As India, where the economy growth has been slowing for several quarters, scrambles to provide for its 1.3 billion citizens, the letter has drawn some criticism from industry figures.
Disappointed to see many startup leaders & investors that I admire add their names to this shameful letter to the govt asking for bailouts – surely at this time the govt has more important things to worry about than pay “50% of salary bills & contract wage bills paid by startups”
— Sumanth Raghavendra (@sumanthr) April 10, 2020
“I can’t fathom how such a list gets made in a country of more than a billion people who are facing a crisis unlike any they’ve seen before. A significant majority of them daily wage earners who have no financial cushion or any idea where their next meal is going to come from. Let’s not even stray into health and the need for medical emergencies; just putting three square meals on the table a day is proving to be impossible for so many,” wrote Ashish K. Mishra in a column on The Morning Context.
“At this very moment, it is they who need the government’s support. Not fat cats with bloated, middling business models and venture capital funds whose begging bowls are now seemingly larger than their risk appetite,” he added.
Companies asking for a bailout is not limited to India. Oil giants have sought similar help from the U.S. President Donald Trump — and VCs and startups are beginning to explore their option. Brent Hoberman, chairman and co-founder of Founders Factory and Firstminute Capital, urged the UK government to provide some relief to startups last month. But the government has yet to do much about it, just ask Deliveroo, Graphcore and other big UK startups.
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Agritech startup DeHaat raises $12M to reach more farmers in India
DeHaat, an online platform that offers full-stack agricultural services to farmers, has raised $12 million as it looks to scale its network across India.
The Series A financial round for the eight-year-old Patna and Gurgaon-based startup was led by Sequoia Capital India. Dutch entrepreneurial development bank FMO, and existing investors Omnivore and AgFunder, also participated in the round. The startup, which began to seek funding from external investors last year, has raised $16 million to date and $3 million in venture debt.
DeHaat (which means village in Hindi) eases the burden on farmers by bringing together brands, institutional financers and buyers on one platform, explained Shashank Kumar, co-founder and chief executive of the startup, in an interview with TechCrunch.
The platform helps farmers secure thousands of agri-input products, including seeds and fertilizers, and receive tailored advisory on the crop they should sow in a season. “We have built a comprehensive database of crop tests to offer advice to farmers,” he said.
DeHaat, which employs 242 people, also helps them connect with 200 institutional partners to provide farmers with working capital, and when the season is over, helps them sell their yields to bulk buyers such as Reliance Fresh, food delivery startup Zomato and business-to-business e-commerce giant Udaan.
DeHaat today operates in 20 regional hubs in the eastern part of India — states such as Bihar, Uttar Pradesh, and Jharkhand — and serves more than 210,000 farmers, said Kumar.
Shashank Kumar, Amrendra Singh, Adarsh Srivastav and Shyam Sundar Singh co-founded DeHaat in 2012
The startup has developed a network of hundreds of micro-entrepreneurs in rural areas that distribute agri-input goods to farmers from their regional hubs and then bring back the output to the same hub.
“We have an app in local languages and a helpline desk that farmers, many of whom don’t own a smartphone, use to reach out to us and explain their pain points and needs,” he said.
DeHaat does not charge any fee for its advisory, but takes a cut whenever farmers use its platform to buy agri-inputs or sell their crop yields.
The startup will use the fresh capital to extend its network to 2,000 rural retail centres, on-board more micro-entrepreneurs for last-mile delivery and reach 1 million farmers by June of next year, said Kumar. DeHaat is also working on automating its supply chain and developing more sophisticated data analytics, he said.
At stake is India’s agriculture market that is worth $350 billion and serves nearly 100 million small and independent farmers, said Abhishek Mohan, VP at Sequoia Capital India, the VC fund that writes more checks than anyone else in the country.
“This industry is on the brink of a massive transformation thanks to ease of regulation, farmers getting organized and increasing penetration of smartphones. DeHaat is leveraging these trends to build the next-gen product in agricultural supply chain,” said Mohan in a statement.
“The tipping point that led to Sequoia India’s decision to partner with them was the field visit, where the farmers expressed how proud they were to be associated with a platform they felt truly worked in their favour. This impact and deep brand loyalty stems from the leadership team’s razor-sharp focus, deep empathy and fine execution,” he added.
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China Roundup: Enterprise tech gets a lasting boost from coronavirus outbreak
Hello and welcome back to TechCrunch’s China Roundup, a digest of recent events shaping the Chinese tech landscape and what they mean to people in the rest of the world. This week, a post from Sequoia Capital sounding the alarm of the coronavirus’s impact on businesses is reaching far corners of tech communities around the world, including China.
Many echo Sequoia’s observation that the companies that are the “most adaptable” are the likeliest to survive. Others cling to the hope of “[turning] a challenging situation into an opportunity to set yourself up for enduring success.”
Two weeks ago I wrote about how the private sector and the government in China are working together to contain the epidemic, bringing a temporary boost to the technology industry. This week I asked a number of investors and founders which of these changes will stand to last, and why.
B2B on the rise
The business-to-business (B2B) space was rarely a hot topic in China until online consumer businesses became relatively saturated in recent times. And now, the COVID-19 epidemic has unexpectedly breathed life into the once-boring field, which stretches from virtual meetings, online education, digital healthcare, cybersecurity, telecommunications, logistics to smart cities, analysis from investment firm Yunqi Partners shows.
For one, there is an obvious opportunity for remote collaboration tools as people work from home. Downloads of indigenous work apps like Dingtalk, WeChat Work, TikTok’s sister Lark as well as America’s Zoom jumped exponentially amid the health crisis. While some argue that the boom is overblown and will dissipate as soon as businesses are back to normal, others suggest that the shift in behavior will endure.
Like other work collaboration services, Zoom soared in China amid the coronavirus outbreak, jumping from No. 180 in late January to No. 28 as of late February in overall app installs. Data: App Annie
“People are reluctant to change once they form a new habit,” suggests Joe Chan, partner at Hong Kong-based Mindworks Ventures. The virus outbreak, he believes, has educated the Chinese masses to work remotely.
“Meeting in person and through Zoom both have their own merits, depending on the social norm. Some people are used to thinking that relationships need to be established through face-to-face encounters, but those who don’t hold that view will have fewer meetings. [The epidemic] presents a chance for a paradigm shift.”
But changes are slow
Growth in enterprise businesses might be less visible than what China witnessed over the SARS epidemic that fueled internet consumer verticals such as ecommerce. That’s because software-as-a-services (SaaS), cloud computing, health tech, logistics and other enterprise-facing services are intangible for most consumers.
“Compared to changes in consumer behavior, the adoption of new technologies by enterprises happen at a slower pace, so the impact of coronavirus on new-generation innovations [B2B] won’t come as rapidly and thoroughly as what happened during SARS,” contended Jake Xie, vice president of investment at China Growth Capital.
Xie further suggested that the opportunities presented by the outbreak are reserved for companies that have been steadily investing in the field, in part because enterprise services have a longer life cycle and require more capital-intensive infrastructure. “Opportunists don’t stand a chance,” he concluded.
As for changing consumer behavior, such as the uptick in grocery delivery usage by seniors trapped indoors, the impact might be short-lived. “The only benefit that the epidemic brings to these apps is getting more people to try their services. But how many of them will stay? The argument that people will keep using these apps over concerns of getting sick in offline markets is unsubstantiated. The strength of a business lies in its ability to solve user problems in the long term, for example, providing affordability and convenience,” suggested Derek Shen, chairman of Danke Apartment, the Chinese co-living startup slated to list on NYSE.
Summoned by Beijing
The adjacent sector of enterprise services — at-scale technologies tailored to energizing government functions — has also seen traction over the course of the epidemic. Private firms in China have teamed up with regional authorities to better track people’s movements, ramp up facial recognition capacities aimed at a mask-wearing public, develop contact-free consumer experience, among other measures.
Tech firms touting services to the government are no stranger to criticisms concerning the lack of transparency in how user data is used. But the appeal to private firms is huge, not only because state contracts tend to provide a steady stream of long-term revenue, but also that certain public-facing projects can be billed as a fulfillment of corporate social responsibilities. Following the virus outbreak, Chinese tech companies of all sizes hastened to offer contributions, with efforts ranging from making monetary donations to building tools that keep the public informed.
On the flip side, the government also needs private help in emergency management. As prominent Chinese historian Luo Xin poignantly pointed out in podcast SurplusValue’s recent episode [1:00:00], some of the most efficient and effective responses to the public health crisis came not from the government but the private sector, whether it is online retailer JD.com or logistics firm SF Express delivering relief supplies to the epicenter of the outbreak.
That said, Luo argued there are signs that some local authorities’ tendency to centralize control is getting in the way of private efforts. For example, some government offices have stumbled in their attempts to develop crisis management systems from scratch, overlooking a pool of readily available and proven infrastructure powered by the country’s tech giants.
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VCs warn coronavirus will impact fundraising for the next 2 quarters
As of this writing, COVID-19 has killed more than 3,400 people around the globe and the coronavirus has infected tens of thousands more. But its impact has gone much further, causing major disruptions in public markets and leading corporations to pull out of conferences and delay travel. Big tech companies are asking workers to stay home and investors are now urging startups to prepare accordingly.
Coronavirus fears are now affecting fundraising for startups. I am seeing advice that tells any company that might run out of cash in 2020 to start raising now before things might get a lot tighter. RIPGoodTimes?
— Josh Elman (@joshelman) March 1, 2020
Sequoia Capital sent a letter to its founders on Thursday warning that the coronavirus was a “black swan” event and startups should “brace themselves for turbulence” by considering if they have enough cash and preparing to face supply chain disruptions. The letter also warned they could have a harder time fundraising, similar to the market downturns of 2001 and 2009.
The coronavirus effect is rippling throughout the tech world. Seattle, which has seen a cluster of cases, seems almost a ghost town in some parts, according to entrepreneur and former Madrona Capital partner Shauna Causey. She told TechCrunch that many of the coffee shops and co-working spaces popular among VCs have gone empty in the last week and all of her fundraising meetings are conducted via Zoom.
Given that fundraising can take several months, if their cash out date is 2020, they should be fundraising soon anyway
also hearing from founders it’s already getting hard
— Evelyn Rusli (@EvelynRusli) March 2, 2020
A Singapore-based VC firm told a startup I’m working with that they’re not going to wire the entire $2m investment they committed to in the Series A, which has been in closing the last few weeks. The rationale was to conserve capital due to coronavirus. The funding risk is real.
— Tommy Leep (@leepnet) March 4, 2020
And already there’s some chatter that funding might be drying up for early-stage startups, though Bloomberg Beta’s Roy Bahat tells TechCrunch that startups should always be fundraising as soon as they can to protect themselves from this type of calamity.
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Mobile banking app Empower Finance just closed a $20 million Series A round
Another afternoon, another round of funding for a mobile banking app. This time, it’s Empower Finance, a San Francisco-based company that’s headed up by former Sequoia Capital partner Warren Hogarth and which just closed on $20 million in Series A funding from Icon Ventures and Defy Ventures.
David Velez, who is the founder and CEO of Nubank, the largest fintech in Latin America, also joined the round.
We’d first written about the company in 2017, when Hogarth was just getting the business off the ground. Fast-forward a bit and Empower now employs 35 people and has attracted more than 600,000 active users to its platform, says Hogarth. What has drawn them in: the company’s promise of combining AI and actual human financial planners to help millennials in particular accrue some wealth, including, more newly, through its own checking account product and through a savings account that’s currently promising 1.60% in annual percentage yield with no minimums, no overdraft fees and unlimited withdrawals.
It’s all part of an overall offering that crunches through account holders’ bank and credit card accounts, and recommends how much they save into which account, how much they should spend given their overall picture, various ways they can cut costs and where and when they’ve surpassed their pre-configured budgets.
Of course, the company has so much competition it’s dizzying, but like the various upstarts against which it’s battling for mindshare, the opportunity that Empower is chasing is enormous, too. Though companies like Chime can seem overpriced given how fast investors have marked up their rounds — Chime’s newest financing, announced in December, was done at a $5.8 billion post-money valuation, which was four times more than the company was worth at the outset of 2019 — digital banks are still tiny fish in an ocean of institutional financial services, representing something like 3% of the market.
They’re gaining more market share by the day, too, including by charging far lower fees for much more.
In Empower’s case, users pay $6 a month, but Hogarth says they also save $300 a year in additional fees they would pay a brick-and-mortar bank. He insists that on average, it also helps them save $1,300 more annually, too.
As for all those other companies — Mint, Acorns, the list goes on — Hogarth sounds surprisingly sanguine. “If you look at it from the outside, it looks crowded. But the consumer financial services in the U.S. is a $2 trillion business, and we haven’t had a fundamental shift since maybe Schwab came along 30 years ago.”
Indeed, says Hogarth, because Empower and its rivals are mobile and branchless and don’t have legacy software to contend with, they’re able to take 60 to 70% of the cost structure out of the business.
What that means on an individual company level is that even if each upstart can attract 2 to 3 million customers, they can get to a multibillion-dollar market cap. At least, that kind of math is “why there’s so much interest in this space,” says Hogarth.
It’s also why people like Nubank’s Velez, who have seen this story play out in Europe and Latin America and who are seeing the early phases of it in the U.S., are apparently keeping the money spigot open for now.
Empower had earlier raised an undisclosed amount of seed funding from Sequoia, followed by a $4.5 million round led by Initialized Capital.
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Expanding its women’s health benefits offerings for employers, Maven raises $45 million
Over the past 12 months, Maven, the benefits provider focused on women’s health and family planning, has expanded its customer base to include more than 100 companies, and grown its telehealth services to include 1,700 providers across 20 specialties — for services like shipping breast milk, finding a doula and egg freezing, fertility treatments, surrogacy and adoption.
The New York-based company, which offers its healthcare services to individuals, health plans and employers, has now raised an additional $45 million to expand its offerings even further.
Its new money comes from a clutch of celebrity investors, like Mindy Kaling, Natalie Portman and Reese Witherspoon, and institutional investors led by Icon Ventures and return backers Sequoia Capital, Oak HC/FT, Spring Mountain Capital, Female Founders Fund and Harmony Partners. Anne Wojcicki, the founder of 23andMe, is also an investor in the company.
“Maven is addressing critical gaps in care by offering the largest digital health network of women’s and family health providers,” said Tom Mawhinney, lead investor from Icon Ventures, who will join the Maven board of directors, in a statement. “With its virtual care and services, Maven is changing how global employers support working families by focusing on improving maternal outcomes, reducing medical costs, retaining more women in the workplace, and ultimately supporting every pathway to parenthood.”
In the six years since founder Katherine Ryder first launched Maven, the company has raised more than $77 million for its service and she became a mother of two boys.
“You go through this enormous life experience; it’s hugely transformative to have a child,” she told TechCrunch after announcing the company’s $27 million Series B round, led by Sequoia. “You do it when your career is moving up — they call it the rush hour of life — and with no one supporting you on the other end, it’s easy to say ‘screw it, I’m going home to my family’ … If someone leaves the workforce, that’s fine, it’s their choice, but they shouldn’t feel forced to because they don’t have support.”
Some of Maven’s partners include Snap and Bumble to provide employees access to its women’s and family health provider network. The company connects users with OB-GYNs, pediatricians, therapists, career coaches and other services around family planning.
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Twitter-backed ShareChat eyes fantasy sports in India
The growing market of fantasy sports in India may soon have a new and odd entrant: ShareChat .
The local social networking app, which in August last year raised $100 million in a financing round led by Twitter, has developed a fantasy sports app and has been quietly testing it for six months, two sources familiar with the matter told TechCrunch.
ShareChat’s fantasy sports app, called Jeet11, allows betting on cricket and football matches and has already amassed more than 120,000 registered users, the sources said. The app, or its website, does not disclose its association with ShareChat.
A ShareChat spokesperson confirmed the existence of the app and said the startup was testing the product.
Jeet11 is not available for download on the Google Play Store due to the Android maker’s guidelines on betting apps, so ShareChat has been distributing it through Xiaomi’s GetApps app store and the Jeet11 website, and has been promoting it on Instagram. It is also available as a web app.
Fantasy sports, a quite popular business in many markets, has gained some traction in India in recent years. Dream11, backed by gaming giant Tencent, claimed to have more than 65 million users early last year. It has raised about $100 million to date and is already valued north of $1 billion.
Bangalore-based MPL, which counts Sequoia Capital India as an investor and has raised more than $40 million, appointed Virat Kohli, the captain of the Indian cricket team, as its brand ambassador last year.
In the last two years, scores of startups have emerged to grab a slice of the market, and the vast majority of them are focused on cricket. Cricket is the most popular sport in India, just ask Disney’s Hotstar, which claimed to have more than 100 million daily active users during the cricket season last year.
Or ask Facebook, which unsuccessfully bid $600 million to secure streaming rights of the IPL cricket tournament. It has since grabbed rights to some cricket content and appointed the Hotstar chief as its India head.
So it comes as no surprise that many sports betting apps have signed cricketers as their brand ambassador. Hala-Play has roped in Hardik Pandya and Krunal Pandya, while Chennai-based Fantain Sports has appointed Suresh Raina.
But despite the growing popularity of fantasy sports apps, where users pick players and bet real money on their performances, the niche is still sketchy in many markets that consider it betting. In fact, Twitter itself restricts promotion of fantasy sports services in many markets across the world.
In India, too, several states, including Assam, Arunachal Pradesh, Odisha, Sikkim and Telangana, have banned fantasy sports betting. Jeet11 currently requires users to confirm that they don’t live in any of the restricted states before signing up for the service.
“It doesn’t help matters either that the fantasy sports business’ attempts at legitimacy involve trying to be seen as video games — a cursory glance at a speakers panel for any Indian video game developer event is evidence of this — rather than riding on its own merits,” said Rishi Alwani, a long-time analyst of Indian gaming market and publisher of news outlet the Mako Reactor.
An executive who works at one of the top fantasy sports startups in India, speaking on the condition of anonymity, said that despite handing out cash rewards to thousands of users each day, it is still challenging to retain customers after the conclusion of any popular cricket tournament. “And that’s after you have somehow convinced them to visit your website or download the app,” he said.
For ShareChat, which has been exploring ways to monetize its 60 million-plus users and posted a loss of about $58 million on no revenue in the financial year ending March 31, that’s anything but music to the ears. In recent months, the startup, which serves users in more than a dozen local languages, has been experimenting with ads.
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Where top VCs are investing in open source and dev tools (Part 1 of 2)
The once-polarizing world of open-source software has recently become one of the hotter destinations for VCs.
As the popularity of open source increases among organizations and developers, startups in the space have reached new heights and monstrous valuations.
Over the past several years, we’ve seen surging open-source companies like Databricks reach unicorn status, as well as VCs who cashed out behind a serious number of exits involving open-source and dev tool companies, deals like IBM’s Red Hat acquisition or Elastic’s late-2018 IPO. Last year, the exit spree continued with transactions like F5 Networks’ acquisition of NGINX and a number of high-profile acquisitions from mainstays like Microsoft and GitHub.
Similarly, venture investment in new startups in the space has continued to swell. More investors are taking shots at finding the next big payout, with annual invested capital in open-source and dev tool startups increasing at a roughly 10% compounded annual growth rate (CAGR) over the last five years, according to data from Crunchbase. Furthermore, attractive returns in the space seem to be adding more fuel to the fire, as open-source and dev tool startups saw more than $2 billion invested in the space in 2019 alone, per Crunchbase data.
As we close out another strong year for innovation and venture investing in the sector, we asked 18 of the top open-source-focused VCs who work at firms spanning early to growth stages to share what’s exciting them most and where they see opportunities. For purposes of length and clarity, responses have been edited and split (in no particular order) into part one and part two of this survey. In part one of our survey, we hear from:
- Vas Natarajan, Accel
- Stephanie Zhan, Sequoia Capital
- Tomasz Tunguz, Redpoint Ventures
- Deepak Jeevankumar, Dell Technologies Capital
- Anna Khan, CRV
- Peter Levine, Andreessen Horowitz
- Ilya Kirnos, SignalFire
- S. Somasegar, Madrona Ventures
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