Y Combinator
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Y Combinator’s Vitable Health is bringing basic healthcare to underserved populations
Joseph Kitonga, the 23-year-old entrepreneur behind Vitable Health, first saw the need for a new kind of healthcare service growing up in Philadelphia and seeing the experience of the home healthcare workers who worked at his parents’ business.
The Kitongas immigrated to the United States a decade ago and settled down in Philadelphia, where they started a home-care business matching workers with patients in need. What was surprising to the younger Kitonga was that the people who worked for his parents taking care of others couldn’t afford basic healthcare coverage themselves.
It was that observation that provided the seed for the business idea that would become Vitable Health, Kitonga’s first business and a recent member of Y Combinator’s latest summer cohort.
The company provides affordable acute healthcare coverage to underinsured or un-insured populations and was born out of his experience watching employees of his parents’ home healthcare agency struggle to receive basic healthcare coverage.
A lot of caregivers make $10 per hour, which is too much to qualify for Medicaid and too little to afford health insurance, Kitonga says.
Even with the Affordable Care Act, many workers in the home-care business that Kitonga’s parents ran in Philadelphia were unable to receive care.
So Kitonga built a service that could cover everything but catastrophic coverage for lower costs than the company’s customers would have to pay if they went to an urgent care facility.
Vitable is able to lower the cost of care through its use of nurse practitioners instead of doctors to provide the care. For a small monthly fee, the company will send providers to make house calls or customers can receive a consultation over the phone.
“We focus on acute and preventive coverage,” says Kitonga. “Most high deductible plans are geared toward providing catastrophic coverage.”
What Kitonga saw with his parents’ employees was that they would wind up going to the emergency room and put $1,300 in charges on their credit cards rather than pay for insurance per month.
Vitable’s lowest plan levels start at $15 per month and the co-payment is $30, according to Kitonga. Vitable’s technicians will do in-home lab tests.
There’s just no low-cost care option available for the population that Kitonga wants to serve, he said. These are people who will be referred to emergency rooms by nearby care providers because they lack the necessary insurance. “The population that we service has been ignored by healthcare providers,” said Kitonga.
For now, the service is only available in Philadelphia, but Kitonga says there are already 1,000 people who receive care through Vitable. “We work with a lot of small businesses that might have 10 or 20 employees,” Kitonga said.
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Without desks and a demo day, are accelerators worth it?
As a result of the pandemic, accelerators have moved operations fully remote to abide by social distancing. The shift has forced well-known programs like 500 Startups, Y Combinator and Techstars to go fully online, while encouraging existing venture capital firms to launch new digital-only fellowships like Cleo Capital and NextView Ventures.
Before the pandemic, accelerators could advertise their value by lending desk space once used by Airbnb, Twilio and Brex’s co-founders, plus a glitzy demo day. Now, stripped of their in-person element, the actual value of an accelerator program — and the network they provide — is being tested in new ways.
So a question remains for participating founders: Are they getting the benefits of what they thought they signed up for?
In the Zoom where it happened
The last thing Michael Vega-Sanz wanted to do was was join another Zoom get-together for entrepreneurs. But the car-sharing company he co-founded with twin brother Matthew was in the middle of a pivot, so they joined NextView Ventures’ inaugural remote accelerator program.
“I envisioned an accelerator with awkward happy hours, mass Zoom calls,” Vega-Sanz said. Fast-forward one month into the program, he says it “has been quite the opposite.”
Before joining NextView’s accelerator, Vega-Sanz did an in-person incubator at Babson College in Boston, but there’s “a lot less fluff” in being virtual, he told TechCrunch.
“[With in-person] the reality was you’d go to lunch, and by the time you drove over there and had all your side talk, small talk, chit-chat and actually got into the nitty-gritty of the event, there was a lot of time loss,” he said. “You could have been working for your company during that time.”
If possible, Vega-Sanz still recommends that first-time founders attend a physical accelerator instead of a virtual one for the energy it brings, even with the downside of useless events.
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YC-backed Glimpse helps Airbnb hosts make money through product placement
Glimpse is giving Airbnb hosts a way to make extra money while also supplying their accommodations with new products.
The startup was founded by CEO Akash Raju, COO Anuj Mehta and CPO Kushal Negi, who all attended Purdue University together. It’s part of the current batch of startups at accelerator Y Combinator — where, coincidentally or not, Airbnb is the most famous alum.
Raju said that he and his co-founders came up with the idea while they were still in school and working with brands to create pop-up shops on campus. They realized that many new, direct-to-consumer brands are looking to increase awareness, and they decided that Airbnbs were the perfect place to convince someone to try (for example) a new mattress or a new kind of coffee. After all, hotels are already in the product placement business.
If you’re an Airbnb host, you can sign up and then browse offers for free product samples. (If you really want to stock up, you can buy larger quantities at a discounted price.)
Glimpse works with you to showcase the products on your properties, and to email a digital “lookbook” highlighting the various products to guests at the beginning and end of their stay. You then earn a commission fee (Raju said $100 to $500 on average, though it can be even higher for big-ticket items) when these samples lead consumers to make a purchase.
Glimpse founders
Brands that have marketed themselves through the platform include the GhostBed mattress and Liquid Death water.
The startup first launched in March of this year — not exactly the best time for the travel business. Raju recalled, “We actually launched right before COVID started. After that, what we really spent a lot of time on was empathizing with hosts.”
In fact, some of Glimpse’s early partners stopped listing their properties for a while. But travel is on the rise again, including (or even especially) via Airbnb, and Raju said many of Glimpse’s 750 current properties are now fully booked through September. And given the lost income of the past few months, hosts might be even more interested than usual.
He added that the team will continue building out the platform with new features for product discovery and attribution, but he said, “The key thing that makes us unique is our emphasis on that in-home experience.”
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Reflect wants to help you automate web testing without writing code
Reflect, a member of the Y Combinator Summer 2020 class, is building a tool to automate website and web application testing, making it faster to get your site up and running without waiting for engineers to write testing code, or for human testers to run the site through its paces.
Company CEO and co-founder Fitz Nowlan says his startup’s goal is to allow companies to have the ease of use and convenience of manual testing, but the speed of execution of automated or code-based testing.
“Reflect is a no-code tool for creating automated tests. Typically when you change your website, or your web application, you have to test it, and you have the choice of either having your engineers build coded tests to run through and ensure the correctness of your application, or you can hire human testers to do it manually,” he said.
With Reflect, you simply teach the tool how to test your site or application by running through it once, and based on those actions, Reflect can create a test suite for you. “You enter your URL, and we load it in a browser in a virtual machine in the cloud. From there, you just use your application just like a normal user would, and by using your application, you’re telling us what is important to test,” Nowlan explained.
He adds, “Reflect will observe all of your actions throughout that whole interaction with that whole browser session. And then from those actions, it will distill that down into a repeatable machine executable test.”
Nowlan and co-founder Todd McNeal started the company in September 2019 after spending five years together at a digital marketing startup near Philadelphia, where they experienced problems with web testing first-hand.
They launched a free version of this product in April, just as we were beginning to feel the full force of the pandemic in the U.S, a point that was not lost on him. “We didn’t want to delay any longer and we just felt like, you know you got to get up there and swing the bat,” he said.
Today, the company has 20 paying customers, and he has found that the pandemic has helped speed up sales in some instances, while slowing it down in others.
He says the remote YC experience has been a positive one, and in fact he couldn’t have participated had they had to show up in California as they have families and homes in Pennsylvania. He says that the remote nature of the current program forces you to be fully engaged mentally to get the most out of the program.
“It’s just a little more mental work to prepare yourself and to have the mental energy to stay locked in for a remote batch. But I think if you can get over that initial hump, the information flow and the knowledge sharing is all the same,” he said.
He says as technical founders, the program has helped them focus on the sales and marketing side of the equation, and taught them that it’s more than building a good product. You still have to go out there and sell it to build a company.
He says his short-term goal is to get as many people as he can using the platform, which will help them refine their ability to automate the test building. For starters, that involves recording activities on-screen, but over time they plan to layer on machine learning and that requires more data.
“We’re going to focus primarily over the next six to 12 months on growing our customer base — both paid and unpaid — and I really mean that we want people to come in and create tests. Even if they [use the free product], we’re benefiting from that creation of that test,” he said.
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Sidekick embraces remote working with always-on teleconferencing hardware
Those forced to acclimate to remote work understand what a pain it can be. Sure, there are certainly benefits to not having to commute into work each day, but among other things, you lose a lot when you eliminate human interaction. Apps like Zoom and Slack have their place, certainly, but none does a particularly good job replicating the in-person work environment.
Formed by three ex-Palantir employees and a former Googler, Y Combinator-backed Sidekick has impeccable timing. The startup (which is fittingly remotely split between the Bay Area and New York), has built a hardware solution designed to bring an always-on video connection to the desk of remote workers (which, as it so happens, is most of us non-essentials, these days).
Development of the project began in earnest when the startup set out interviewing 100+ teams to discuss the challenges of remote work.
“We reflected deeply on what’s needed to enable these organic conversations. We came from a background as ICs and managers working on distributed teams at Palantir and Google, where we had all the shiniest collaboration tools at our disposal — Slack, Zoom, Notion, Tandem,” Sidekick writes in a recent blog post. “Despite this entire suite of shiny tools, we would still fly out for a week every month from our home office in NYC to join our remote halves in London — over 20 hours in travel and thousands of dollars in expenses every month.”
Image Credits: Sidekick
Sidekick contends that teleconferencing apps like Zoom create too much friction between the user and creating a kind of virtual open office. The teams the company spoke with suggested that a dedicated hardware device was the way to go here, so Sidekick repurposed an OEMed tablet, forking Android to their purpose. The company’s roadmap involves a proprietary hardware device sporting key aspects like a depth sensor.
For now, however, it’s selling its version of the existing consumer tablet through a hardware-as-a-service plan. Customers will be charged $50 per month, per device.
“They should only pay us as long as we’re delivering that value, and stop paying us if we’re not,” Sidekick told TechCrunch when asked about the subscription method. “We see the hardware as the best way of delivering that, but we believe that what’s most fair is for our users to pay for exactly the continued value we provide — not the hardware itself.”
There’s a physical button that puts the system to sleep, but when it’s on, it’s on. Users can’t turn the camera off and remain in stealth, either. Personally, I’d be hesitant to have an always-on camera sitting in my living room (small, one bedroom New York apartment) with a direct line to my co-workers. One of the things you risk working from home is getting a little too…comfortable, if you will. After a few hours of not interacting, it’s easy to forget that there’s a camera trained on you.
The startup tells TechCrunch that the system isn’t for everyone. “Sidekick is meant for fast-moving teams, often forced into remote work, that truly need to be in the same room to make progress,” the company explains. “Teams like startup founding teams, product leadership, executives/chief-of-staffs and sales.”
There’s probably something to be said for the executives themselves who are looking for an easier way to keep tabs on employees now that they can’t just swing by their cubicle. Sidekick has a purchasing option “for teams of all sizes and setups,” though hopefully the product remains more about collaboration and less about monitoring for most teams.
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Recurrency is taking on giants like SAP with a modern twist on ERP
Recurrency, a member of the Summer 2020 Y Combinator cohort, was started by a 21 year old just out of college. He decided to take on a highly established market that is led by giants like SAP, Infor, Oracle and Microsoft, but instead of taking a highly complex area of enterprise software in one big bite, he is starting by helping wholesale businesses.
Sole founder and company CEO Sam Oshay just graduated from the University of Pennsylvania with a dual degree that straddled engineering and business, before joining the summer batch. Oshay is bringing a modern twist to ERP by using machine learning to drive more data-driven decision making.
“What makes us different from other ERPs like SAP, Infor and Epicor is that we can tell the user something that they don’t already know.” He says these traditional ERPs are basically data entry systems. For example, you could enter a pricing list, but you can’t do anything with it in terms of predictions.
“We can scan historical data and make pricing recommendations and predictions. So we are an ERP that not only does data analysis, but also imports external data and matches it to internal data to make recommendations and predictions,” Oshay explained.
While he doesn’t expect to remain confined to just the wholesale side of the business, it makes sense that he started with it because his family has a history of running these kinds of businesses. In fact, his grandfather immigrated to the U.S. after World War II and started a hardware wholesale business that his uncle still runs today. His dad started his own business selling wholesale shipping supplies, and he grew up in the family business, giving him some insight that most recent college grads probably wouldn’t have.
“I learned about the wholesale business at a very deep level. And what I observed is that so many of the issues with my dad’s business came down to issues with his ERP system. It occurred to me that if someone were to build an ERP extension or a better ERP, they could unlock so much of the value that is currently locked inside these legacy systems,” he said.
So he did what good entrepreneurs do, and began building it. For starters, his system plugs into legacy systems like SAP or NetSuite, but the plan is to build a better ERP, one step at a time. For now, it’s about wholesale, but he has a much broader vision for his company.
He originally applied to YC during the Fall 2019 semester of his junior year, and was admitted to the winter batch, but deferred to the Summer 2020 group to complete his studies. He spent his remaining time at UPenn sprinting to early graduation, taking 10 classes to come close to finishing his studies (with just a dissertation standing between him and his degree).
With this batch being delivered remotely, he says that the YC team has taken that into account and is still offering a meaningful experience for the summer group. “All of the events that YC would normally be doing are still happening, just remotely. And to my knowledge, some of the events we’re doing are designed specifically for this weird set of circumstances. The YC team has put quite a bit of thought into making this batch meaningful and I think they’ve succeeded,” he said.
While the pandemic has created new challenges for an early-stage business, he says that in some ways it’s helped him focus better. Instead of going out with friends, he’s home with his head down working on his company with little distraction.
As you would expect, it’s early days for the product, but he has three customers who are operational and two more in the implementation phase. He also has two employees so far, a front end and back end engineer.
For now, he’s going to continue building his product and his business, and he sees the pandemic as a time when businesses might be more open to changing a system like a legacy ERP. “If they want to try something new, and you can make it easier for them to try that, I’ve found that’s a place where you can make a sale,” he said.
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Mighty Health created a wellness app with older adults top of mind
Virtual classes might make it easier to work out anywhere, anytime, but not for anyone. Mainstream fitness tech often targets the young and fit, in advertisements and cardio-heavy exercises. It effectively excludes aging adults from participating.
This gap between mainstream fitness and elders is where Mighty Health, a Y Combinator graduate, comes in.
Mighty Health has created a nutrition and fitness wellness app that is tailored to older adults who might have achy hips or joint problems. Today, the San Francisco-based startup has announced it raised $2.8 million in funding by Y Combinator, NextView Ventures, RRE Ventures, Liquid2 Ventures, Soma Capital and more.
Founder and CEO James Li is the child of immigrants, a detail he says helped him lean into entrepreneurship. He had the idea for Mighty Health after his father was rushed to the hospital for emergency open-heart surgery.
“Growing up, we can often think of our parents as invincible — they look after you and take care of you, and you usually don’t worry too much about them,” Li said. His dad survived the surgery, and Li thought about the evolving health needs and limitations of folks over 50 years old. He teamed up with co-founder Dr. Bernard Chang, the youngest-ever ED doctor to receive a top-tier NIH grant and the vice chair of research at Columbia University Medical Center, to create Mighty Health.
Mighty Health’s product is focused on three things: live coaching; content focused on nutrition, preventative checkups and workouts; and celebrations that let family members tune into their loved ones’ achievements.
The app has inclusivity built into its functionality. Everyday, a user logs in and gets a set of three to five tasks to complete, distributed among nutrition, exercise and workouts. The workouts are pre-recorded videos with trainers that have focused on the over-50 population. Think indoor cardio sets focused on being kinder to joints or lower her impacts.
Image Credits: Mighty Health
One customer, Elizabeth, is a 56-year-old mother who joined Mighty Health after suffering a cardiac incident. The app got her to start walking 9,000 steps a day, lose weigh, lower cholesterol and, best of all, discover a love for a vegetable she had recently written off: brussels sprouts.
Mighty Health’s other core focus, beyond fitness, is nutrition. The app pairs users with a coach to help them create healthy habits around nutrition and lifestyle. The coaching is done through text message. Li says this was intentional because in the early days of Mighty Health, he saw that coaching in-app was difficult for users to navigate.
Image Credits: Mighty Health
“You have to meet them in the middle where they are,” Li said. The live coaching is also met with phone calls, although 90% of coach interactions are text-message based.
The nutrition program also accounts for a diverse user base. Mighty Health chose not to offer or push recipes upon members, unlike a lot of other applications, because all countries and cultures might not find generic recipes accessible.
“Instead, we focus on the ingredient level,” he said. “We send them ingredients that they can piece together however they like at home in the way that they cook their cultural meals.”
The company offers a free seven-day trail, followed by a membership fee of $20 per month. It’s also having discussions with a number of health insurers to offer Mighty Health as a benefit.
With the new capital, the startup hired a few engineers and a designer to build out product integrations with fitness trackers, plus add new content. For now, Li sees his father’s progress with pride.
“Though I’m sure he sometimes thinks I just went from nagging him directly to nagging him through my product, he’s been eating healthier and exercising nearly every day,” Li said. So far, his father has lost 25 pounds.
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Athlane looks to connect brands and esports streamers with a fresh $3.3 million in funding
Athlane, the YC-backed company from the Summer ’19 cohort, is today ready to launch with a fresh $3.3 million in capital. Investors include Y Combinator, Jonathan Kraft (New England Patriots), Michael Gordon (President of Fenway Sports Group, which owns the Red Sox and Liverpool Football Club), Global Founders Capital, Romulus Capital, Seabed VC and more.
The startup originally positioned itself as the “NCAA of esports” but, after some time in stealth, has taken a new approach. Athlane is looking to be the connective fiber between streamers and brands, facilitating sponsorship and endorsement deals with more transparent data and analytics and a streamlined communications flow.
Athlane has products for both brands and streamers.
Brands can use the Athlane Terminal to manage their sponsorships. The Insights Hub uses proprietary data to help brands understand which streamers are followed by their target demographic, and whether or not the products will resonate with that fan base. Insights also allow brands to see when a streamer’s viewership is growing.
From there, brands can send out sponsorship deals to streamers directly through the Athlane Terminal, and then track the ROI on that sponsorship deal throughout the campaign.
On the streamer side, the company has built out a platform called Athlane Pro, which lets streamers manage each task from their sponsors individually. Streamers can also use Athlane Pro to counter-offer inbound sponsorship deals or negotiate terms.
Streamers can also use Athlane’s machine learning algorithm to get clearer insights on their stream performance, such as whether their YouTube viewership overlaps with their Twitch viewership, or see which videos do better based on title or thumbnail. But more importantly, the Athlane Content Hub gives streamers the opportunity to understand if their fan base specifically aligns with this or that brand, and gives them the tools to reach out directly to that brand to solicit a sponsorship.
Athlane has also built out a Shop tool that lets streamers build out a no-code storefront for their fans, which they can link to on their Twitch, Twitter, Instagram, etc. This storefront can be a repository for all the products that streamer is endorsing, allowing fans to see products from multiple brands in a single place.
“We have a number of proprietary partnerships with data providers including companies like Twitter,” said co-founder Faisal Younus. “For example, we have a partnership with the leading manufacturer of apparel in esports, which ties back into our system so we can look at how merchandise is moving.”
That data, when paired with the data provided when a streamer signs in and integrates with the platform, becomes very precise, according to the company.
The startup charges brands using a tiered SaaS model, and streamers can do their first sponsorship for free on the platform. After the first sponsorship, streamers are charged a fee between $10 and $20 per deal. Athlane has also started working with agencies that represent brands and charges a discovery fee for talent those agencies find on the platform.
“COVID-19 has brought on very rapid growth on the viewership side, and because of that we’ve seen an intense interest from a number of brands while conventional entertainment is shut down,” said Younus. “A lot of media spend is going to go unspent, but there is also a higher risk appetite for spending a little bit in esports, and our challenge is making sure this industry growth is sustained.”
He added that helping brands understand the true ROI of that spend will be key.
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QuestDB nabs $2.3M seed to build open source time series database
QuestDB, a member of the Y Combinator summer 2020 cohort, is building an open source time series database with speed top of mind. Today the startup announced a $2.3 million seed round.
Episode1 Ventures led the round with assistance from Seedcamp, 7percent Ventures, YCombinator, Kima Ventures and several unnamed angel investors.
The database was originally conceived in 2013 when current CTO Vlad Ilyushchenko was building trading systems for a financial services company and he was frustrated by the performance limitations of the databases available at the time, so he began building a database that could handle large amounts of data and process it extremely fast.
For a number of years, QuestDB was a side project, a labor of love for Ilyushchenko until he met his other co-founders Nicolas Hourcard, who became CEO and Tancrede Collard, who became CPO, and the three decided to build a startup on top of the open source project last year.
“We’re building an open source database for time series data, and time series databases are a multi-billion-dollar market because they’re central for financial services, IoT and other enterprise applications. And we basically make it easy to handle explosive amounts of data, and to reduce infrastructure costs massively,” Hourcard told TechCrunch.
He adds that it’s also about high performance. “We recently released a demo that you can access from our website that enables you to query a super large datasets — 1.6 billion rows with sub-second queries, mostly, and that just illustrates how performant the software is,” he said.
He sees open source as a way to build adoption from the bottom up inside organizations, winning the hearts and minds of developers first, then moving deeper in the company when they eventually build a managed cloud version of the product. For now, being open source also helps them as a small team to have a community of contributors help build the database and add to its feature set.
“We’ve got this open source product that is free to use, and it’s pretty important for us to have such a distribution model because we can basically empower developers to solve their problems, and we can ask for contributions from various communities. […] And this is really a way to spur adoption,” Hourcard said.
He says that working with YC has allowed them to talk to other companies in the ecosystem who have built similar open source-based startups and that’s been helpful, but it has also helped them learn to set and meet goals and have access to some of the biggest names in Silicon Valley, including Marc Andreessen, who delivered a talk to the cohort the same day we spoke.
Today the company has seven employees, including the three founders, spread out across the US, EU and South America. He sees this geographic diversity helping when it comes to building a diverse team in the future. “We definitely want to have more diverse backgrounds to make sure that we keep having a diverse team and we’re very strongly committed to that.”
For the short term, the company wants to continue building its community, working on continuing to improve the open source product, while working on the managed cloud product.
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YC to cut the size of its investment in future YC startups
In a blog post this Friday afternoon, Y Combinator’s president Geoff Ralston said that the accelerator would make two changes to its terms for startups.
The first would see the size of the standard deal for YC startups decline from $150,000 for 7% (roughly a $2.1 million post-money valuation) to $125,000 for the same equity (or roughly a $1.79 million post-money valuation). The deal will continue to be offered using a SAFE, which YC and a group of others pioneered as a simpler investment option compared to convertible notes.
Interestingly, the firm is always writing into its terms that it will only take pro rata up to 4% of a subsequent round’s size, which is obviously smaller than the 7% ownership that the company is buying in its financing. That 4% number is a ceiling — in cases where the accelerator has less ownership than 4%, the smaller percentage applies. Full terms of Y Combinator’s deal are available on its website.
The new deal will apply to startups who join Y Combinator in the Winter 2021 batch, and doesn’t include startups in the current summer batch (who have already presumably been funded)
YC’s deal has varied over the years. When it first launched more than a decade ago, it offered terms of $20,000 for 6%.
A Y Combinator spokeswoman said that the change was in line with the fundraising and budget realties of the accelerator going forward. “The future of the economy is unpredictable, and we feel it is prudent during these times to switch to a leaner model,” she said. “In our case, we want to be set up to fund as many great founders as possible — especially during a time that is creating an unprecedented change to consumer and business behavior; with these changes comes endless opportunities for startups. And with the changes made to our standard deal, we can fund as many as 3000 more companies.”
Outside of budget, at least a couple of factors are potentially at work here. One is the increased use of Work From Anywhere, which presumably can help lower some of the running costs of a startup, particularly in its earliest days (e.g., no need to pay for that WeWork flex desk).
Y Combinator has also invested more of its funds into emerging markets startups, which can have dramatically lower costs of development given prevailing wages for talent in local markets.
Yet, the cutback is also a sign that the flood of capital entering the Valley in recent years has receded — if ever so slightly — in the wake of COVID-19. Valuations are depressing, and while $25,000 is not a massive loss considering the scale of later venture financings, the 16% valuation haircut is in line with other numbers we have seen in the Valley in recent weeks.
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