1010Computers Staging

startups weekly

Auto Added by WPeMatico

1 2 3 … 7

How Duolingo became a $2.4B language unicorn

Published May 8, 2021

At the heart of Duolingo is its mission: to scale free education and increase income potential through language learning. However, the same mission that has helped it grow to a business valued at $2.4 billion with over 500 million registered learners, has led to tensions that continue to define the business.

How do you survive as a startup if you don’t want to charge users? How do you design a startup that isn’t too hard to lose people, but isn’t too easy to compromise education? How do you balance monetization goals while also keeping education as a product free?

For my first EC-1, I spent months with Duolingo executives, investors, and of course, competitors, to answer some of these questions.

One of my favorite details in the story that got left on the cutting room floor was Duolingo co-founder and CEO Luis von Ahn comparing his company to the elliptical. I was pressing him on the efficacy of Duolingo, and the long-standing critique that it still can’t teach a user how to speak a language fluently.

“Now, there’s a difference between whether you know you’re doing the elliptical or yoga or running, but by far, the most important thing is that you’re doing something [other than] just walking around,” he said.

What von Ahn is getting at is that Duolingo’s biggest value proposition is that it helps people get motivated to learn a language, even if it’s just five minutes — or an elliptical workout — a day. He thinks motivation is harder than the learning itself. Do you agree?

If you enjoyed my series, make sure to check out other EC-1s and subscribe to ExtraCrunch to support me, this newsletter and the rest of the team. I’d also love it if you followed me on Twitter @nmasc_.

In the rest of this newsletter, we’ll talk about Tesla, the morality of going public and verticalized telehealth.

There’s always a Tesla angle

When I was working in Boston, the newsroom saying was “there’s always a Boston Angle.” In a remote, tech-dominated world, I’ll tweak it: There’s always a Tesla angle. While we all prepare for Elon Musk to grace the SNL stage, there’s a story you might want to check out.

Here’s what to know: Tesla tapped a small Canadian startup to build cleaner and cheaper batteries. The price tag will shock you, but the story tells a bigger narrative about patented technology, and the outsized impact that a tiny startup has on Tesla’s route to batteries.

Literally moving us along:

Tesla taps tiny startup’s tech to build cheaper, cleaner batteries

Tesla electric vehicle china

Image Credits: Getty Images

The clash of the CFOs

While Equity usually keeps it light and punny, we chewed into a deeper topic this week: the morality of going public. Startups are staying private longer than ever before, but one CFO argues that it’s a moral obligation to leave the nest and provide returns to the general public. We had that CFO on the show, along with another CFO at a company pursuing a SPAC. It ended up being the most interesting clash of the CFOs I’ve been a part of.

Here’s what to know: The growth of venture capital as an asset class has a role to play in this whole mess and has kept the nest warm for many startups. We talk about if the tides are turning, or we’re saying goodbye to a world in which a company like Salesforce would debut price for $11 per share.

While you’re focused on Twitter’s tip jar, here’s other money news you may have missed in the meantime: 

The morality and efficacy of going public earlier

Image Credits: Getty Images / dane_mark

Where telehealth goes from here

As I start to cover digital health, one of the biggest questions I ask and get asked is where telehealth goes from here. Virtual caretaking had an uptick in usage because of the pandemic but is now starting to slow as the world reopens and vaccinations are on the rise. For telehealth startups, it means crafting a pitch that explains why virtual care makes sense for the conditions you serve.

Here’s what to know: I talked about how to become pandemic-proof in healthcare with Expressable, a virtual speech therapy startup that just raised millions in venture capital money. Part of the startups’ product differentiation is an edtech platform that motivates consumers to asynchronous practice speech exercises with the help of parents and friends.

And down the rabbit hole we go: 

Expressable launches with millions for scalable speech therapy

Image Credits: Getty Images / drante

Around TechCrunch

Announcing the TechCrunch Early Stage Marketing & Fundraising agenda

Seen on TechCrunch

Yale’s longtime — and legendary — endowment chief, David Swensen, has passed away at age 67

Seen on Extra Crunch

Freemium isn’t a trend — it’s the future of SaaS

And that’s that. Thank you for reading along and supporting me. I’ll never get over it.

N

Powered by WPeMatico

Emotional marketing and an e-mail titan walk into a bar

Published May 1, 2021

My mom cuts to the chase when she is describing my beat to others. In her words, I cover companies like Uber before they become companies like Uber. And honestly? I can’t exactly disagree with the description. The best feeling in tech journalism is telling a story about a startup before it becomes a household name. As an early-stage reporter, I honestly bet a lot on the potential of a savvy edtech founder or creative marketplace play. And when I’m doing my job right, I point to the unique insight that will make the startup successful or challenged in the future.

On that note, one of my favorite renewed series at TechCrunch is an EC-1 (Extra Crunch subscription required), a story series that goes through the nitty-gritty of a startup’s story, from its original days to its pivots along the way. I’ve spent the past few months on one of these projects — and mine is coming out next week! In the meantime, you’ve read packages about StockX and Tonal, and our latest just came out: the Klaviyo EC-1:

Image Credits: Nigel Sussman

Enjoy this long-form read and big thanks to Danny Crichton, my Equity co-host and managing editor here at TechCrunch, who has been managing and editing all of these projects.

In the rest of this newsletter we’ll get into All Raise data, the new Miami and a new lineup you don’t want to miss. Follow me on Twitter @nmasc_ for updates throughout the week.

All (aren’t) Raise(d)

All Raise, a nonprofit dedicated to increasing the footprint of women founders and funders, has released its annual report for 2020. The whole thing is honestly worth a read, but we especially paid attention to how funding has dropped for female founders:

  • Round sizes for women + non-binary founders were up to 49% lower than males
  • 85% of venture funding goes to all-male teams
  • 64% of VC firms still don’t have a single female partner
  • Black + Latinx female founders receive only 0.64% of VC funding, a slight uptick from the year prior.

Here’s what to know: On Equity, we talked about how these abysmal metrics were both a predicted but still surprising effect of Zoom investing. This disconnect is the conversation no one has during an upmarket — and metrics are one way we can benchmark progress.

Precursor Ventures’ Charles Hudson on ‘the conversation no one has during an upmarket’

Internet is the new Miami

To quote Winnie CEO and co-founder Sara Mauskopf, “Internet is the new Miami.” The networks made online — either through the rise of meme culture or Substack spice — can be a competitive advantage in the world of investment, as two new funds this week showed us.

Here’s what to know: Ryan Hoover and Vedika Jain announced Weekend Fund 3, which will include a $1 million community raise. And Chief Meme Officer Turner Novak finally debuted Banana Capital’s debut fund launched with $9.99 million in funding.

Banana Capital’s debut fund is for internet-first founders

Novak explained how being internet-first impacts his investments:

“It just kind of happens where [my investments] are people who understand the culture of the internet, to understand memes and understand wit and humor and appreciate that a little bit more,” he said. “Those are probably the people that are more naturally intuitive investments, so it definitely does skew that direction.”

While Novak didn’t share explicit targets or mandates around investment in diverse founders, he pointed to his track record at Gelt VC, in which 41% of capital went to woman CEOs. To date, 65% of Banana Capital’s portfolio founding teams include non-white founders and 50% of the teams include more than one gender.

Around TechCrunch

Announcing the Agenda for TC Sessions: Mobility 2021

Across the week

Seen on TechCrunch

The AWS for blockchain

Atlassian launches a Jira for every team

CES will return to Las Vegas in 2022

Microsoft’s new default font options, rated

Seen on Extra Crunch

Hacking my way into analytics: A creative’s journey to design with data

How Brex more than doubled its valuation in a year

Hacking my way into analytics: A creative’s journey to design with data

And finally

India is in crisis. It is devastating and heartbreaking to watch this unfold and impact our family and friends and colleagues and people. My colleague Manish Singh, who is based there, wrote up the different ways you can donate to help out.

India’s entrepreneurs and investors are mobilizing to help the nation fight COVID-19 — and you can too

I’ll end by quoting Singh:

With several major industries, including film and sports, going about their lives pretending there is no crisis, entrepreneurs and startups have emerged as a rare beam of hope in recent days, springing to action to help the nation navigate its darkest hours.

It’s a refreshing change from last year, when thousands of Indian startups themselves were struggling to survive. And while some startups are still severely disrupted, offering a helping hand to the nation has become the priority for most.

Until next week,

N

Powered by WPeMatico

What the MasterClass effect means for edtech

Published April 24, 2021

MasterClass, which sells a subscription to celebrity-taught classes, sits on the cusp of entertainment and education. It offers virtual, yet aspirational learning: an online tennis class with Serena Williams, a cooking session with Gordon Ramsay. While there’s the off chance that an instructor might actually talk to you — it has happened before — the platform mostly just offers paywalled documentary-style content.

The vision has received attention. MasterClass is raising funding that would value it at $2.5 billion, as scooped by Axios and confirmed independently by a source to TechCrunch. But while MasterClass has found a sweet spot, can the success be replicated?

Investors certainly think so. Outlier, founded by MasterClass’ co-founder, closed a $30 million Series C this week, for affordable, digital college courses. The similarities between Outlier and its founder’s alma mater aren’t subtle: It’s literally trying to apply MasterClass’ high-quality videography to college classes. This comes a week after I wrote about a “MasterClass for Chess lovers” platform launched by former Chess World Champion Garry Kasparov.

Two back-to-back MasterClass copycats raising millions in venture capital makes me think about if the model can truly be verticalized and focused down into specific niches. After 2020 and the rise of Zoom University, we know edtech needs to be more engaging, but we don’t know the exact way to get there. Is it by creating micro-learning communities around shared loves? Is it about gamification? Aspirational learning has different incentives than for-credit learning. In order to be successful, Outlier needs to prove to universities it can use MasterClass magic for true outcomes that rival in-person lectures. It’s a harder, and more ambtious promise.

My riff aside, I turned to two edtech founders to understand how they see the MasterClass effect panning out, and to cross-check my gut reaction.

Taylor Nieman, the founder of language learning startup Toucan:

Although I do love how these models try to lean into this theme of “invisible learning” like we leverage with Toucan, it faces the same issues as so many other consumer products that try to steal time out of people’s very busy days. Constantly competing for time leads to terrible engagement metrics and very high churn. That leads me to question what true learning outcomes could occur from little to no usage of the product itself.

Amanda DoAmaral, the founder of Fiveable, a learning platform for high school students:

Masterclass is important for showing us why educational content should be treated more like entertainment. All of our bars for content quality is much higher now than it ever was before and I’m excited to see how that affects learning across the board.

For students, it’s about creating environments that support them holistically and giving them space to collaborate openly. It feels so obvious that these spaces should exist for young people, but we’ve lost sight of what students actually need. At my school, we built policies that assumed the worst in students. I want to flip that. Assume the best, be proactive to keep them safe, and create ways to react when we need to.

Anyways, that’s just some nuance to chew on during this fine day. In the rest of this newsletter, we will focus a lot on tactical advice for founders, from the money they raise to the peacock dance they might want to do one day. Make sure to follow me on Twitter @nmasc_ so we can talk during the week, too!

Garry Kasparov launches a community-first chess platform

The peacock dance

You know when male peacocks fan their feathers to court a lover? That, but for startups trying to get acquired. As one of our many rabbit holes on Equity this week, we talk about Discord walking away from a Microsoft deal, and if that deal ever existed in the first place or if it was just a way to drum up investor excitement in the audio gaming platform.

Here’s what to know: Discord is reportedly pursuing an IPO after walking away from talks with multiple companies that were looking to acquire the audio gaming giant.

Discord aside, the consolidation environment continues to be hot for some sectors.

Four business people used ropes to tighten their money bags, economic austerity, reduced income, economic crisis

Image Credits: VectorInspiration / Getty Images

Even venture capital knows that the future isn’t simply venture capital

Clearbanc, a Toronto-based fintech startup that gives non-dilutive financing to businesses, has rebranded alongside a $100 million financing that valued it at $2 billion. Now rebranded as Clearco, the startup wants to be more than just a capital provider, but a services provider, too.

Here’s what to know: The startup has been on a tear of product development for the past year, launching services such as valuation calculators or runway tools. It’s a step away from what Clearbanc originally flexed: the 20-minute term sheet and rapid-fire investment. I talk about some of the levers at play in my piece:

Many of Clearco’s newest products are still in their infancy, but the potential success of the startup could nearly be tied to the general growth of startups looking for alternatives to venture capital when financing their startups. Similar to how AngelList’s growth is neatly tied to the growth of emerging fund managers, Clearco’s growth is cleanly related to the growth of founders who see financing as beyond a seed check from Y Combinator.

abstract human brain made out of dollar bills isolated on white background

Abstract human brain made out of dollar bills isolated on white background. Image Credits: Iaremenko / Getty Images

Don’t market your opportunity away

Keeping on the theme of tactical advice for founders, let’s move onto talking about marketing. Tim Parkin, president of Parkin Consulting, explained how startup founders can use marketing as a tool to stand out in the noisy environment. Differentiation has never been harder, but also more imperative.

Here’s what to know: Parkin outlines four ways that martech will shift in 2021, strapped with anecdotes and a nod to the importance of investing in influencers.

Red ball on curved light blue paper, blue background. Image Credits: PM Images / Getty Images

Around TechCrunch

Your humble yet favorite startup podcast, Equity, got nominated for a Webby! Me and the team need your help to win, so please vote for us here. Your support means a ton.

This newsletter will always be free, but if you do want to support me, feel free to use code STARTUPSWEEKLY for 25% off a subscription to Extra Crunch.

Across the site

Seen on TechCrunch

The rise of the next Coinbase, thanks to Coinbase

Attack of the robotic SPACs

Tiger Global backs Indian crypto startup at over $500M valuation

This is your brain on Zoom

Early Coinbase backer Garry Tan is keeping the ‘vast majority’ of his shares because of this deal

Seen on Extra Crunch

Dear Sophie: How can I get my startup off the ground and visit the US?

How to pivot your startup, save cash and maintain trust with investors and customers

How startups can ensure CCPA and GDPR compliance in 2021

As UiPath closes above its final private valuation, CFO Ashim Gupta discusses his company’s path to market

European VC soars in Q1

zoom glitch

Image Credits: TechCrunch

Thanks for reading along today and everyday. Sending love to my readers in India and everyone around the world that is facing yet another deadly surge of this horrible disease. I’m rooting for you.

N

How to pivot your startup, save cash and maintain trust with investors and customers

Powered by WPeMatico

What does it take to create a startup ecosystem?

Published April 17, 2021

Say it louder for the people in the back: As tech grows bigger by the minute and venture capital adds dollar signs by the day, a startup hub’s success is not an either/or situation. The next Silicon Valley is a tired narrative, when in reality startups look, innovate and create differently all over the world.

On that note, my colleagues spent the past few months digging into the market in Detroit, Michigan:

While StockX is the startup darling that may have put the region in the generalist spotlight, I soon learned that the sneaker marketplace company wasn’t at all where the city’s story started and ended. Instead, it started a little more at ground level.

Detroit techies consistently point to billionaire Dan Gilbert, the co-founder of Quicken Loans and the owner of the Cleveland Cavaliers, as the reason behind the region’s startup growth. It made me immediately wonder if all it takes to create a startup ecosystem is deep pockets.

Turns out it’s a little more complicated than that.

Gilbert has poured at least $2.5 billion into rehabilitating buildings in the core of Detroit. Then he invested in the companies that took office space in those buildings, the restaurants that would feed those new families in the area and the retailers that would fill up the side blocks. It wasn’t one check by one billionaire, but instead a measured and consistent approach to try to reestablish Detroit as a city of innovation within the United States.

Detroit’s native son, billionaire Dan Gilbert, makes the case for his town

I think one founder put it best: “there are a lot of people who hate him, but the reality is that, while he wasn’t the only billionaire in town, he’s the only one who heavily invested in Detroit.”

Beyond Gilbert, the vitalization is spread throughout different sectors. There’s a 12-year-old early-stage venture firm that was one of the first to ever bet on mobility as an investment thesis; there’s a thriving garden startup; and there’s a hardware company that, despite remote work, is finding space to scale:

We’ll continue exploring emerging tech hubs, so throw us suggestions as we virtually (and one day physically) road trip across the country.

The TechCrunch Survey of tech startup hubs in England and Wales

 

In the rest of this newsletter, we’ll talk about Tiger Global, IPOs and a few exciting upcoming events. Make sure to follow me on Twitter @nmasc_ to hang during the week.

Tiger Global has a spending problem

This week on Equity, we talked about Tiger Global’s aggressive investment approach and what it could mean for early-stage firms and founders.

Here’s what to know: One of the reasons Tiger Global is feeling spendy is that it just closed one of the biggest venture funds ever. In 2020, the firm closed $3.75 billion in capital commitments. In 2021, it nearly doubled its own record, with $6.7 billion raised for its latest fund.

Tiger Global just closed one of the biggest venture funds ever, with $6.7 billion

And if you don’t believe me, below is a list of just some of the New York-based firms’ recent activity:

Crypto’s Coinbase moment

Cryptocurrency trading giant Coinbase went public this week. The company opened at $381 per share, valuing the exchange at nearly $100 billion. It was a massive exit for the company, which underwent scrutiny last year when it banned politics at work.

Here’s what to know: It’s fairly obvious that Coinbase’s successful IPO was a big moment for fintech and crypto startups, as well as the decentralized finance movement. My colleagues Alex Wilhelm and Anna Heim dug into how the crypto ripple effect could look from the perspective of a few venture capitalists. There are too many good bits for me to choose an excerpt, so read it for yourself here, and a take sneak peek below:

So while there is an ocean of bullish sentiment that the Coinbase listing will lead to rising venture capital investment into crypto startups, there’s also some caution to be had; how much of the growing market that Coinbase can capture and control is not yet clear, though IVP’s Loverro was very bullish during our interview about the company’s expanding feature set — things like staking Tezos, or buying Uniswap. Its backers think that Coinbase is well-positioned to absorb future market upside in its niche.

Around TechCrunch

As always, we have a ton of exciting events coming up. Here’s just a taste:

Tamika Butler, Remix’s Tiffany Chu and Revel’s Frank Reig to discuss how to balance equitability and profitability at TC Sessions Mobility

Across the week

Seen on TechCrunch

Pakistan temporarily blocks social media

Republican antitrust bill would block all Big Tech acquisitions

Can the tech trade show return in 2021?

Garry Kasparov launches a community-first chess platform

Garry Kasparov launches a community-first chess platform

Seen on Extra Crunch

What’s fueling hydrogen tech?

Billion-dollar B2B: cloud-first enterprise tech behemoths have massive potential

For startups choosing a platform, a decision looms: build or buy?

Building customer-first relationships in a privacy-first world is critical

The IPO market is sending us mixed messages

What’s fueling hydrogen tech?

Best,

N

Powered by WPeMatico

Let’s talk about gaslighting and fundraising

Published April 12, 2021

“Most of the startups I give advice to about how to raise venture capital shouldn’t be raising venture capital,” an investor recently told me. While the idea that every startup isn’t venture-backable might run counter to the narrative to the barrage of funding news each week, I think it’s important to double click on the topic. Plus, it keeps coming up, off the record, on phone calls with investors!

As venture grows as an asset class, the access to capital has broadened from a dollar perspective, but I do think the difficulties that remain is an important dynamic to call out (and something no one talks about during an upmarket). Beyond the fact that only a small subset of startups truly can pull off scaling to the point of venture-level returns, it is still hard for even qualified founders to raise venture capital. Venture capital is still a heavily white, male-led industry, and as a result contains bias that disproportionately limits access for underrepresented founders.

Eniac founding partner Hadley Harris applied this dynamic to the current market boom in a recent tweet: A lot of people are misunderstanding this VC funding market. More money is flowing into the market but the increase is not evenly distributed. The market believes winners can be much bigger but not necessary that there will be more winners. It’s still very hard for most to raise a VC.

To say otherwise is to gaslight the early-stage or first-time founders that have spent months and months trying to raise their first institutional dollars and failed. So ask yourself: Seed rounds have indeed grown bigger, but for who? What comes at the cost of the $30 million seed round? Are the founders that can raise overnight from diverse backgrounds? Are investors backing first-time founders as much as they are backing second- or third-time entrepreneurs?

The answers might leave you debating about the boundaries, and limitations, of the upcoming hot-deal summer.

A few weeks ago, I wrote about the disconnect between due diligence and fundraising right now. Now we’ve moved onto the disconnect, and bifurcation, within first-check fundraising itself. There is so much more we can get into about the fallacy of “democratization” in venture capital, from who gets to start a rolling fund to the lack of assurance within equity crowdfunding campaigns.

The disconnect between Y Combinator Demo Day and due diligence

We’ll get through it all together, and in the meantime make sure to follow me on Twitter @nmasc_ for more hot takes throughout the week.

In the rest of this newsletter, we will talk about fintech politics, the Affirm model with a twist, and sneakers-as-a-service.

Ex-Coinbase talks politics

The inimitable Mary Ann Azevedo has been dominating the fintech beat for us, covering everything from the latest Uruguayan unicorn to Acorn’s scoop of a debt management startup. But the story I want to focus on this week is her interview with ex-Coinbase counsel & former Treasury official, Brian Brooks.

Here’s what to know: Coinbase CEO Brian Armstrong notoriously released a memo last year denouncing political activism at work, calling it a distraction. In this exclusive interview, Brooks spoke about how blockchain is the answer to financial inclusion, and argued why politics needs to be taken out of tech.

We don’t want bank CEOs making those decisions for us as a society, in terms of who they choose to lend money to, or not. We need to take the politics out of tech. All of us do a lot of different things, and we have no idea on a given day, whether what we’re doing is popular with our neighbors or popular with our bank president or not. I don’t want the fact that I sometimes feel Republican to be a reason why my local bank president can deny me a mortgage.

Image Credits: Bryce Durbin/TechCrunch

The Affirm for X model

While Affirm may have popularized the “buy now, pay later” model, the consumer-friendly business strategy still has room to be niched down into specific subsectors. I ran into one such startup when covering Plaid’s inaugural cohort of startups in its accelerator program.

Here’s what to know: Walnut is a new seed-stage startup that is a point-of-sale loan company with a healthcare twist. Unlike Affirm, it doesn’t make money off of fees charged to consumers.

Image Credits: Bryce Durbin/TechCrunch

Everything you could ever want to know about StockX

In our latest EC-1, reporter Rae Witte has covered a startup that leads one of the most complex and culturally relevant marketplaces in the world: sneakers.

The StockX EC-1

Here’s what to know: StockX, in her words, has built a stock market of hype, and her series goes into its origin story, authentication processes and a market map.

Image Credits: Nigel Sussman

Around TechCrunch

Found, a new podcast joining the TechCrunch network, has officially launched! The Equity team got a behind-the-scenes look at what triggered the new podcast, the first guests and goals of the show. Make sure to tune into the first episode.

Saying hello to TechCrunch’s newest podcast: Found

Also, if you run into any paywalls while browsing today’s newsletter, make sure to use discount code STARTUPSWEEKLY to get 25% off an annual or two-year Extra Crunch subscription.

Across the week

Seen on TechCrunch

Okta launches a new free developer plan

New Jersey announces $10M seed fund aimed at Black and Latinx founders

Education nonprofit Edraak ignored a student data leak for two months

6 VCs talk the future of Austin’s exploding startup ecosystem

Dear Sophie: Help! My H-1B wasn’t chosen!

Seen on Extra Crunch

5 machine learning essentials nontechnical leaders need to understand

How we dodged risks and raised millions for our open-source machine language startup

Giving EV batteries a second life for sustainability and profit

And that’s a wrap! Thanks for making it this far, and now I dare you to go make the most out of the rest of your day. And by make the most, I mean listen to Taylor’s Version.

Warmly,

N

Powered by WPeMatico

Nonobvious acquisitions are on my 2021 bingo board

Published April 3, 2021

At the end of 2020, I argued that edtech needs to think bigger in order to stay relevant after the pandemic. I urged founders to think less about how to bundle and unbundle lecture experience, and more about how to replace outdated systems and methods with new, tech-powered solutions. In other words, don’t simply put engaging content on a screen, but innovate on what that screen looks like, tracks and offers.

A few months into 2021, the exit environment in edtech…feels like it’s doing exactly that. The same startups that hit billion and multi-billion valuations during the pandemic are scooping up new talent to broaden their service offerings.

Ruben Harris, the founder of Career Karma, a platform that matches aspiring coding professionals to bootcamps, put together a massive report recently with his team to talk about the pandemic’s impact on the bootcamp market.

James Gallagher, the author of the report, tells me:

It is important to note that the full potential of bootcamps has not yet been realised. We are now seeing more exploration of niches like technology sales which provide gateways into new careers in tech for people who otherwise may not have been able to acquire training. To scale such models, new businesses will need venture capital.

He went on to explain how a notable acquisition from 2020 was K12 scooping up Galvanize, “which would give K12 exposure into corporate training and the coding bootcamp space, a market outside of K12’s focus at the moment.”

To me this report signal two things: the financial interest in boot camps isn’t simply stemming from other bootcamps (although that is happening), but it’s surprising partnerships. Leaving this subsector, we see creative acquisitions such as a Roblox for edtech buying a language learning tool, and a startup known for flashcards scooping up a tech tutoring service.

Readers should know by this point that I love a nonobvious acquisition (except when this almost happened), so if you have any more tips on coming deals in edtech, please Signal me or direct message me on Twitter.

I’ll end with this: Successful startup founders are innately ambitious, finding opportunity in moonshots and convincing others that the odds are in their favor. However, the ceiling for what defines ambition heightens almost everyday. What used to be a win is now a nonnegotiable, and a feat is only a feat until your competitor hits the exact same milestone.

To win post-pandemic, edtech needs to start thinking big

Acquisitions are one way to scoop up competition and synergistic talent, but it’s what happens next that matters the most.

In the rest of this newsletter, we will talk about Clubhouse competitors, how a homegrown experiment became one of the fastest growing companies in fitness tech and a cool-down in public markets (?!). As always, you can get this newsletter in your inbox each Saturday morning, so subscribe here to join the cool kids.

Clubhouse might create billions in value, but could capture none of it

Remember when everyone was buzzing around about building Stories? That’s so pre-pandemic. A number of companies recently announced plans to build their own versions of Clubhouse, after the buzzy app unearthed the consumer love for audio.

Here’s what to know: It might be easier to start guessing who isn’t building a Clubhouse clone at this point. Our predictions are already starting, but jokes aside, the rise in clones could mean that Clubhouse might have to make a run for its pre-monetized money (cough, cough, Twitter spaces). It doesn’t matter if a startup is first in unlocking a key insight, all that matters is who executes that key insight the best.

Image Credits: Getty Images

A strong unicorn, literally

Tonal, a fitness tech startup, became a unicorn this week after raising a new tranche of capital.

Here’s what to know: The new status underscores market growth for at-home fitness solutions. And while we don’t have a Tonal S-1 yet, we do have a Tonal EC-1. EC-1’s are TechCrunch’s riff on an S-1, and are essentially a deep dive into a company.

The Tonal EC-1

Reporter JP Mangalindan wrote thousands and thousands of words about Tonal, from its origin story to business model, its focus on communities and its biggest hurdles ahead.

Image Credits: Nigel Sussman

Initial public o….no

You’ve probably had a better week than Compass, Deliveroo and Kaltura. The three companies all had different events that illustrate a potential damper on the part that has been the public markets.

Here’s what to know: Compass cut its shares and lowered pricing of said shares, Deliveroo had a rough debut as a delivery company on the public markets, and Kaltura postponed its IPO after valuation demand didn’t hit expectations.

In other news, though:

Photo Taken In Arizona, United States. Image Credits: Jure Batagelj / 500px / Getty Images

Around TechCrunch

Thanks to everyone who tuned in to TechCrunch Early Stage! If you enjoyed the event (or missed it), don’t worry: Disrupt is almost here.

Buy a pass to Disrupt 2021 and get a free Extra Crunch membership

Across the week

Seen on TechCrunch

How startups can go passwordless, thanks to zero trust

Tips for founders thinking about doing a remote accelerator

US iPhone users spent an average of $138 on apps in 2020, will grow to $180 in 2021

Niantic CEO shares teaser image of AR glasses device

The Weeknd will sell an unreleased song and visual art via NFT auction

Seen on Extra Crunch

Embedded procurement will make every company its own marketplace

5 mistakes creators make building new games on Roblox

E-commerce roll-ups are the next wave of disruption in consumer packaged goods

How our SaaS startup improved net revenue retention by more than 30 points in two quarters

Powered by WPeMatico

Startups, Supreme, and soft-circling your way to an investment

Published March 20, 2021

In an Extra Crunch Live this past week, Cleo Capital founding partner Sarah Kunst broke down what founders can learn from Supreme, a sought-after streetwear brand. She argued that founders, similar to Supreme, should build a brand around themselves that is so well-respected and has clout that whenever they start something new, investors will line up.

“A Supreme shirt that costs $100 bucks in the store will cost $1,000 online so, as an investor, I am just a kid on the street corner flipping sportswear,” Kunst mentioned. “Who do I think is going to be an investment with such velocity that getting in early is going to be more than worth it as they grow.”

I think this is the best framing I’ve seen about how to drum up excitement for a startup as a founder. FOMO isn’t a strategy, it’s a tactic. What really works, as Kunst alluded to, is when founders can point to key insights they’ve had throughout their career beyond the context of a fundraising process. In other words, anyone can create a nice t-shirt and slap a logo on it. Which founder in this sector is going to give it meaning? It might be the one with the big former exit, the one that was the first Black woman to ever build a unicorn, or the one that was on the ground facing the pain point they now want to solve.

We get into how to build a fundraising process, the concept of soft-circling an investor and what Kunst says is one of her biggest pet-peeves in a pitch deck on the site, but I wanted to give you that sneak peek for now.

Saying ‘yes, please’ to no code

This week, Airtable was valued at $5.77 billion from a fresh Series E fundraise.

Here’s what to know: As we discussed on Equity, Airtable is far more than a savvy Excel sheet with bells and whistles. It is one of the leaders in the no-code movement, and founder Howie Liu recently opened up its API to promote developer innovation atop its platform.

Okay, the GPT-3 hype seems pretty reasonable

Image Credits: Cadalpe (opens in a new window) / Getty Images

A seedy asset class

Per Climate Editor Jonathan Shieber, farmland could become the next big asset class modernized by marketplace startups.

Here’s what to know: One startup, AcreTrader, is trying to create a Robinhood for buying farmland, which I think is indicative of how lucrative some view a patch of land. CEO Carter Malloy thinks that while private equity often gets press for being in the land game, most land is owned by smaller ownership through families.

“Over the last few months, we’ve consistently seen our offering sizes grow while our funding windows shrink, showcasing the fast-growing desire surrounding this resilient asset class,” he said.

More places for investors to throw their money reminds me of two other stories for you to check out:

"A green row celery field in the Salinas Valley, California USA"

A green row celery field in the Salinas Valley, California USA. Image Credits: Pgiam (opens in a new window)/ Getty Images

Around TechCrunch

Consider these upcoming notes as the coupon section for your early-stage founder and investor dreams.

First up, I’m tossing you a discount code to our TechCrunch Early Stage conference, our two-day virtual event for founders, investors and operators. Use code “TCARTICLE” to get 20% off your ticket so you can attend super cool events like how to bootstrap with Calendly’s Tope Awotona and OpenView’s Blake Bartlett, how to pitch your Series A fundraise with Kleiner Perkins’ Bucky Moore, and finance for founders with Alexa von Tobel.

Secondly, we are already well into planning TechCrunch Disrupt 2021! Grab super early-bird passes for less than $100, to attend our all-virtual event.

Thirdly, thank you for all the support. DM me any questions you might have, and I really hope to see your lovely faces there.

Across the week

Seen on TC

Uber under pressure over facial recognition checks for drivers

5 trends in the boardrooms of high-growth private companies 

Forget medicine, in the future you might get prescribed apps

Tech companies should oppose the new wave of anti-LGBTQ legislation

Seen on EC 

Social+ payments: Why fintechs need social features

Snowflake gave up its dual-class shares, should you?

MaaS transit: The business of mobility as a service

Survey: Share feedback on Extra Crunch

Talk next week,

N

Survey: Share feedback on Extra Crunch

Powered by WPeMatico

The Product Manager asterisk

Published March 8, 2021

Product manager might be one of the most grey roles within a startup. However, as a company progresses and the team grows, there comes a time when a founder needs to carve out dedicated roles. Of these positions, product management might be one of the most elusive — and key — roles to fill.

Ken Norton, who recently left his job as director of product at Figma to consult rising PMs, thinks it’s easier to start with defining what they aren’t: the CEO of the product.

“Product managers need to realize that there is a lot of janitorial work that gets done in product management,” he said. “It’s not fun or glamorous, and it’s certainly not being the CEO of the product. It’s just stuff that needs to get done.” I wrote up a guide on how and when to hire your first product manager that expands on some of these insights, including how focus might be the biggest trait to interview for:

Hiring continues to be one of the hardest parts of building a startup, and those early employees can define the trajectory, culture and eventual success of it. Even during TC Sessions: Justice this past week, Precursor’s Sydney Thomas explained how startups need to make “pretty final decisions, pretty early on in what type of company you want to build.”

How and when to hire your first product manager

It’s a slight asterisk to the common narrative of how startups pivot every other day. It’s not that simple, and I’ll probably remind you of that every other week, dear Startups Weekly readers.

The rest of today’s newsletter will include notes on a hot up-and-coming edtech IPO, an exit that includes Jay-Z, and the latest in agricultural tech robots. Also, remember you can always find me on Twitter @nmasc_ or e-mail me at natasha.m@techcrunch.com.

The public markets get educated

It’s been yet another busy week for the public markets. I published a scoop earlier this week that Coursera is filing to go public soon, which would be one of the first debuts that will let us see how an education company’s finances changed, and accelerated, amid the pandemic’s impact on remote learning.

Here’s what to know: Like clockwork, Coursera’s S-1 dropped late Friday, giving us the first glance of the numbers behind the business. The startup tried to pain a picture of a path of profitability, with rising revenues as well as rising net losses. We get into the meat of it here. 

Image Credits: Fotograzia / Getty Images

What’s better than one billionaire? Two 

One of the biggest headlines of this past week was Square buying a majority stake of Tidal. A fintech and music collaboration might not seem that obvious, but the music economy remains one of the most under-tapped (and under-innovated) opportunities that remains out there.

Square buys majority of Tidal, adds Jay-Z to its board in bid to shake up the artist economy

Here’s what to know: Square CEO Jack Dorsey used his other company, Twitter, to share more information about the $297 million deal. As part of this transaction, Tidal owner Jay-Z got a board seat with Square, triggering conversations about the future of musical NFTs. The deal also officially confirmed that Jay-Z isn’t just a businessman, he’s a business, man.

Singer Jay-Z performs before US President Barack Obama speaks at a campaign rally in Columbus, Ohio, on November 5, 2012. After a grueling 18-month battle, the final US campaign day arrived Monday for Obama and Republican rival Mitt Romney, two men on a collision course for the world’s top job. The candidates have attended hundreds of rallies, fundraisers and town halls, spent literally billions on attack ads, ground games, and get out the vote efforts, and squared off in three intense debates. AFP PHOTO/Jewel Samad (Photo credit should read JEWEL SAMAD/AFP/Getty Images)

Decentralized insect farming, anyone?

In this week’s Equity Wednesday episode, we brought on TC’s climate tech editor, Jonathan Shieber, to talk about the opportunities within agtech right now. We covered a lot within the 20-minute episode: from $100 million for mealworms, farm-to-grill robots and decentralized insect farming.

$100 million for mealworms

Here’s what to know: Farms have always had a compelling reason to turn to robotics to make tedious work much, much easier. We got into two different businesses and their approaches on how to serve farm robots, from SaaS leases to selling the robots one by one.

Image Credits: Fernando Trabanco Fotografía / Getty Images

Around TechCrunch

Thanks to all of you who tuned into TC Sessions: Justice this past week, it was so fun to hang — and make sure to give virtual kudos to my colleague, and showrunner, Megan Rose Dickey.

Next up is TechCrunch Early Stage, our yearly event that is all about tactical advice to help new and first-time founders navigate the Wild West world that is venture capital and startups. We just announced the judges of the pitch-off competition, and have already landed top-tier venture capitalists to share what you won’t find on Twitter: behind the scenes startup advice that is beyond 180 characters.

Announcing the Early Stage Pitch-Off judges

It’s the bootcamp you always wished you could attend, so get your tickets here.

Across the week

Seen on Extra Crunch

Understanding how investors value growth in 2021

Dear Sophie: Can you demystify the H-1B process and E-3 premium processing

11 words and phrases to cut from your VC pitch deck

Making sense of the $6.5B Okta-Auth0 deal

11 words and phrases to cut from your VC pitch deck

Seen on TechCrunch

SoftBank makes mountains of cash off of human laziness

Mary Meeker’s Bond has closed its second fund with $2 billion

The technology selloff is getting to be somewhat material

What China’s Big Tech CEOs propose at the annual parliament meeting

Mary Meeker’s Bond has closed its second fund with $2 billion

And finally…

I wanted to end by using this platform to address the rise of anti-Asian violence across our country. Conversations around how to be a more inclusive and anti-racist society need to be more loud, and more collaborative in order for change to actually happen. Intention around inclusion will impact the world we live in, the startups we create and the success of our collective. Here are some resources to donate, petition and learn.

Thanks,

N

Powered by WPeMatico

How capital-as-a-service can help you get your first check in 2021

Published February 27, 2021

“A lot of founders mix up raising money with making money.”

This quote, which Career Karma founder Ruben Harris mentioned off-hand on a phone call with me, has been on my mind for months. In fact, raising money can cost you money, in the form of that sweet, sweet ownership and equity.

That’s why Clearbanc, a startup I have covered for years, has always had a compelling pitch.

The company, co-founded by Michele Romanow and Andrew D’Souza, positions itself as an alternative equity-free capital solution for early-stage founders. Flexing its “20-minute term sheet” the startup uses an algorithm to shift through a startup’s data, and if it has positive ad spend and positive unit economics, they make an investment worth anything from $10,000 to over $10 million. It makes money through a revenue-share agreement versus an equity stake.

“While we’ve invested in over 4,000 businesses using this model, we’ve also turned away over 50,000 who weren’t at this scale or level of repeatability,” D’Souza tells TechCrunch. So, the startup told me this week that they have raised $10 million to create a new product: ClearAngel.

The startup is trying to back anyone with an online business that has early revenue, but pre-broad traction. Clearbanc wants to replace friends and family money, a concept that D’Souza says is “quite elitist,” with its own version of an angel check, while also offering founder services such as supply chain analysis, introductions to networks and competitive landscape analysis.

The startup just needs to make around $1,000 in monthly revenue to qualify for cash. In return for an investment between $10,000 to $50,000, founders have to pay up to 2% of their revenue over four years.

Clearbanc’s repayment works for some startups, but for others, a traditional bank loan could work better. Its biggest hurdle, I’d argue, is that if a startup has great revenue already, you might not want to take a revenue-share agreement loan.

As for if a startup takes ClearAngel capital and doesn’t make the minimum revenue?

“Then the ClearAngel product isn’t working,” he said. “There are bound to be some companies who still can’t make it, that’s the risk we take.”

Alternative capital has pros and cons, just like venture capital has pros and cons. If the end goal is to become a billion-dollar business, what’s the best route to do that? Is taking a revenue-share agreement going to hurt your chances as a pre-seed startup trying to raise capital? Does YC care at all?

Those are some of my biggest questions, and we’ll explore all (and more!) in my alternative financing panel next week for TC Sessions: Justice. It costs $5 to attend the entire conference, and speakers include Backstage Capital’s Arlan Hamilton and Congresswoman Barbara Lee.

Remember that you can get Startups Weekly in your inbox before anyone else, if you subscribe. It’s free! As always, you can find me @nmasc_ on Twitter or e-mail me at natasha.m@techcrunch.com. That is free too!

Register for TC Sessions: Justice for a conversation on diversity, equity and inclusion in the startup world

Coinbase files to go public

After being valued at $100 billion in the secondary markets, Coinbase has finally filed to go public. The S-1, as Winnie founder Sara Mauskopf tweeted, is #goals. The crypto unicorn, as my colleague Alex Wilhelm notes, grew just over 139% in 2020, a massive improvement on its 2019 results.

Here’s what to know:

As the SPAC frenzy continues, questions arise about how much the market can absorb

Other notes:

Coinbase Co-founder and CEO Brian Armstrong

SAN FRANCISCO, CA – SEPTEMBER 07: Coinbase Co-founder and CEO Brian Armstrong speaks onstage during Day 3 of TechCrunch Disrupt SF 2018 at Moscone Center on September 7, 2018 in San Francisco, California. (Photo by Steve Jennings/Getty Images for TechCrunch)

Mobility-as-a-service

I caught up with Eric Eldon, managing editor at TechCrunch and former Startups Weekly writer, about the recent work he’s been doing with Kirsten Korosec, our transportation editor.

Here’s what he had to say: Startup employees may not be going into the office as often again — or ever. But everyone will still need to go places, or at least want to! How will they do it? What will we do? How will our altered set of needs and wants reshape cities, right as new technologies are fundamentally altering transportation, too? We’re going to be covering this topic in-depth this year, as we all figure out how to go back to work.

Other reading:

TechCrunch Mobility

Crazy ride on the night by car. Image Credits: franckreporter/Getty Images.

Spain wants startups to succeed on its soil

The Spanish government, led by Prime Minister Pedro Sanchez, has announced plans to turn itself into an entrepreneurial nation. The Startup Act is the first piece of dedicated legislation meant to help create tech innovation within Spain. The goals are to promote innovation, new capital through domestic and foreign investments, and to seed the future of Spain as a hub for new companies.

Here’s what to know: Driving innovation can start with relaxing on regulatory concerns.

Among a package of some 50 support measures, the entrepreneurial strategy makes a reference to “smart regulation” and floats the idea of sandboxing for testing products publicly (i.e. without needing to worry about regulatory compliance first).

Spain’s ten-year plan to put startups in the economic driving seat

Other news this week:

Image Credits: MHJ (opens in a new window) / Getty Images

Some personal news

As loyal Equity listeners may have already noticed, we’ve been quietly experimenting with the concept of adding on a third show to our weekly production. This week, we told the world! Along with our current shows, which help listeners start and end the week with tech news, we’re going to bring on a Wednesday deep dive into a topic, subject area or person. Our first mid-week episode went live this week, and it was all about space (so yes, expect a lot of puns and Elon jokes).

SpaceX is really just SPAC and an ex

The show is about to celebrate its four-year anniversary, and I’m about to celebrate my one-year anniversary as a co-host. We’re all so thankful for your support, and can’t wait to bring you more laughs and learnings.

Our latest episodes:

Across the week

Seen on TechCrunch

The startup bootcamp you’ve always needed is finally here

Scoop: VCs are chasing Hopin upwards of $5-6B valuation

Lisbon’s startup scene rises as Portugal gears up to be a European tech tiger

Sources: Lightspeed Venture Partners is close to hiring a London-based partner to put down roots in Europe

Contra wants to be a community for independent workers

Seen on Extra Crunch

Ironclad’s Jason Boehmig: The objective of pricing is to become less wrong over time

As BNPL startups raise, a look at Klarna, Affirm and Afterpay earnings

4 essential truths about venture investing

4 essential truths about venture investing

And that’s the jam-packed week! As an insider tip to those that subscribe, I’m starting to cover health tech (along with edtech) for the TC team. So throw me the smartest person you know on the topic, and extra points if that’s you.

N

Powered by WPeMatico

Multiplayer fintech, and the muddled world of startup data

Published February 13, 2021

There’s always a fintech angle, even on Valentine’s Day.

This week, I covered Zeta, a new startup working on joint finances for modern couples. It aims to take away the money chores of a relationship, from splitting the bill at dinner to requesting rent through a payment app every month.

Aditi Shekar, the co-founder, gave me some notes about why the ongoing popularity of Venmo is validation for the company, instead of competition.

Here’s what I learned:

The success of Zeta hinges on the idea that people want to share their finances in an ongoing and meaningful way, and that the world of finance is ready to shift from individualism to collectivism earlier and louder. It sounds daunting, but we already know that social finance is big, as shown by apps like Venmo and Splitwise, and phenomena like the GameStop saga from just a few weeks ago.

Other startups have taken notice too, entering the world of multiplayer fintech, a term that categorizes socially focused and consumer-friendly financial services. Braid, a group-financing platform, is trying to make transactions work for various entities, from shared households to side hustles to creative projects.

Money is emotional and complex, and the opportunity within the multiplayer fintech reflects just that. The next wave of products will be able to straddle the line of comfort to successfully get adoption, and cultural shift to successfully deliver a truly collaborative cash experience.

What should banking look like for modern couples?

(And in case that wasn’t enough Valentine’s Day content for you, here’s one more piece about a new dating app for gamers).

In the rest of this newsletter, we’ll talk about the new career path to CEO, our favorite startups from Techstars Demo Day and the latest SPAC you should probably know about. As always, you can find me on Twitter @nmasc_ or e-mail me at natasha.m@techcrunch.com. Want this in your inbox each week? Sign up here.

Data on startups is dreadful

Data about startups is helpful to understand directional trends and how the flow of capital works and changes over time. But as ventures as an asset class grows and the documentation around raises gets thornier, the data can sometimes be missing a big chunk of what’s actually happening on the scenes.

Here’s what to know per Danny Crichton and Alex Wilhelm: PSA: most aggregate VC trend data is garbage and Are SAFEs obscuring today’s seed volume are two pieces that explain some of the reasons why the numbers might be flawed today. The good news is that the government is also in the dark about funding data; the bad news is that without good tracking, we don’t know how progress is being made.

Etc: Shameless plug for you to tip us on Secure Drop, TechCrunch’s submission system for any news you think is important to share. You can stay anonymous.

Image via Getty Images / Sadeugra

The new CEO

Amazon founder and CEO Jeff Bezos announced weeks ago that he was shifting into an executive chairman role and AWS CEO Andy Jassy would take over as chief executive. In this analysis, our enterprise cloud reporter Ron Miller explores the question: is overseeing cloud operations the new path to CEO?

Is overseeing cloud operations the new career path to CEO?

Here’s what to know, per Andrew Bartels, an analyst at Forrester Research:

“In both cases, these hyperscale business units of Microsoft and Amazon were the fastest-growing and best-performing units of the companies. [ … ] In both cases, cloud infrastructure was seen as a platform on top of which and around which other cloud offerings could be developed,” Bartels said. The companies both believe that the leaders of these two growth engines were best suited to lead the company into the future.

Etc: Ember names former Dyson head as consumer CEO as the startup looks beyond the smart mug, and Monzo, the British challenger bank nearing 5 million customers, has recruited a new US CEO.

AWS CEO Andy Jassy and Microsoft CEO Satya Nadella

Image Credits: Amazon / Microsoft

A triple-hitter Demo Day

TechCrunch covered favorites from Techstars’ three Demo Days, which were focused on Chicago, Boston and workforce development. Make sure to dig into the startups yourself to form your own opinions, but if you care what stood out to us, here’s what we ended up with.

TechCrunch’s favorites from Techstars’ Boston, Chicago and workforce accelerators

Here’s what to know: The reason I love Demo Days is that it’s a fast way to understand what the next wave of startups and entrepreneurs are thinking about. In this year’s cohorts, we saw an exclusive sneaker marketplace, flexible life insurance and a part-time childcare platform that helps parents cover random gaps in their childcare schedule.

Etc: Without desks and a demo day, are accelerators worth it?

Image Credits: Paper Boat Creative (opens in a new window) / Getty Images

Public markets fly high

Archer Aviation, the electric aircraft startup targeting the urban air mobility market, is teaming up with United Airlines to become a publicly traded company via, you guessed it, a SPAC.

Archer lands $1B order from United Airlines and a SPAC deal

Here’s what to know per Kirsten Korosec, our transportation editor:

The agreement to go public and the order from United Airlines comes less than a year after Archer Aviation came out of stealth. Archer was co-founded in 2018 by Adam Goldstein and Brett Adcock, who sold their software-as-a-service company Vettery to The Adecco Group for more than $100 million. The company’s primary backer was Lore, who sold his company Jet.com to Walmart in 2016 for $3.3 billion. Lore was Walmart’s e-commerce chief until January.

Etc: Bumble priced and Nigeria’s IROKO plans to go public on the London Stock Exchange.

Use cloud foam to dollar sign

Around TC

Across the week

Seen on TechCrunch

Seen on Extra Crunch

@Equitypod: Does SoftBank have 20 more DoorDashes?

SoftBank earnings always give key insights about how a heavyweight in venture capital is performing (and the bonanza always comes with a healthy share of content and memes). This week on Equity, we couldn’t resist nerding out about it:

Of course, if SoftBank isn’t your jam, there was a whole host of other news we chatted about, from Reddit’s latest raise to DoorDash buying a salad robot. Listen here.

DoorDash acquires salad-making robotics startup, Chowbotics

Until next week,

N

 

Powered by WPeMatico

1 2 3 … 7