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Brazilian proptech startup QuintoAndar lands $300M at a $4B valuation

Published May 28, 2021

Fintech and proptech are two sectors that are seeing exploding growth in Latin America, as financial services and real estate are two categories in particular dire need of innovation in a region.

Brazil’s QuintoAndar, which has developed a real estate marketplace focused on rentals and sales, has seen impressive growth in recent years. Today, the São Paulo-based proptech has announced it has closed on $300 million in a Series E round of funding that values it at an impressive $4 billion.

The round is notable for a few reasons. For one, the valuation — high by any standards but especially for a LatAm company — represents an increase of four times from when QuintoAndar raised a $250 million Series D in September 2019.

It’s also noteworthy who is backing the company. Silicon Valley-based Ribbit Capital led its Series E financing, which also included participation from SoftBank’s LatAm-focused Innovation Fund, LTS, Maverik, Alta Park, an undisclosed U.S.-based asset manager fund with over $2 trillion in AUM, Kaszek Ventures, Dragoneer and Accel partner Kevin Efrusy.

Having backed the likes of Coinbase, Robinhood and CreditKarma, Ribbit Capital has historically focused on early-stage investments in the fintech space. Its bet on QuintoAndar represents clear faith in what the company is building, as well as its confidence in the startup’s plans to branch out from its current model into a one-stop real estate shop that also offers mortgage, title, insurance and escrow services.

The latest round brings QuintoAndar’s total raised since its 2013 inception to $635 million.

Ribbit Capital Partner Nick Huber said QuintoAndar has over the years built “a unique and trusted brand in Brazil” for those looking for a place to call home.

“Whether you are looking to buy or to rent, QuintoAndar can support customers through the entire transaction process: from browsing verified inventory to signing the final contracts,” Huber told TechCrunch. “The ability to serve customers’ needs through each phase of life and to do so from start to finish is a unique capability, both in Brazil and around the world.”

QuintoAndar describes itself as an “end-to-end solution for long-term rentals” that, among other things, connects potential tenants to landlords and vice versa. Last year, it expanded also into connecting a home buyers to sellers.

Image Credits: QuintoAndar

TechCrunch spoke with co-founder and CEO Gabriel Braga and he shared details around the growth that has attracted such a bevy of high-profile investors.

Like most other businesses around the world, QuintoAndar braced itself for the worst when the COVID-19 pandemic hit last year — especially considering one core piece of its business is to guarantee rents to the landlords on its platform.

10 proptech investors see better era for residential and retail after pandemic

“In the beginning, we were afraid of the implications of the crisis but we were able to honor our commitments,” Braga said. “In retrospect, the pandemic was a big test for our business model and it has validated the strength and defensibility of our business on the credit side and reinforced our value proposition to tenants and landlords. So after the initial scary moments, we actually felt even more confident in the business that we are building.”

QuintoAndar describes itself as “a distant market leader” with more than 100,000 rentals under management and about 10,000 new rentals per month. Its rental platform is live in 40 cities across Brazil, while its home-buying marketplace is live in four. Part of its plans with the new capital is to expand into new markets within Brazil, as well as in Latin America as a whole.

The startup claims that, in less than a year, QuintoAndar managed to aggregate the largest inventory among digital transactional platforms. It now offers more than 60,000 properties for sale across Sao Paulo, Rio de Janeiro, Belho Horizonte and Porto Alegre. To give greater context around the company’s growth of that side of its platform: In its first year of operation, QuintoAndar closed more than 1,000 transactions. It has now surpassed the mark of 8,000 transactions in annualized terms, growing between 50% and 100% quarter over quarter.

As for the rentals side of its business, Braga said QuintoAndar has more than 100,000 rentals under management and is closing about 10,000 new rentals per month. The company is not profitable as it’s focused on growth, although it’s unit economics are particularly favorable in certain markets such as Sao Paulo, which is financing some of its growth in other cities, according to Braga.

Brazil’s Loft adds $100M to its accounts, $700M to its valuation in a single month

Now, the 2,000-person company is looking to begin its global expansion with plans to enter the Mexican market later this year. With that, Braga said QuintoAndar is looking to hire “top-tier” talent from all over.

“We want to invest a lot in our product and tech core,” he said. “So we’re trying to bring in more senior people from abroad, on a global basis.”

Some history

CEO Braga and CTO André Penha came up with the idea for QuintoAndar after receiving their MBAs at Stanford University. As many startups do, the company was founded out of Braga’s personal “nightmare” of an experience — in this case, of trying to rent an apartment in Sao Paulo.

The search process, he recalls, was difficult as there was not enough information available online and renters were forced to provide a guarantor, or co-signer, from the same city or pay rent insurance, which Braga described as “very expensive.”

“Overall, I felt it was a very inefficient and fragmented process with no transparency or tech,” Braga told me at the time of the company’s last raise. “There was all this friction and high cost involved, just real tangible problems to solve.”

The concept for QuintoAndar (which can be translated literally to “Fifth Floor” in Portuguese) was born.

“Little by little, we created a platform that consolidated supply and inventory in a uniform way,” Braga said.

The company took the search phase online for the first time, according to Braga. It also eliminated the need for tenants to provide a guarantor, thereby saving them money. On the other side, QuintoAndar also works to help protect the landlord with the guarantee that they will get their rent “on time every month,” Braga said.

It’s been interesting watching the company evolve and grow over time, just as it’s been fascinating seeing the region’s startup scene mature and shine in recent years.

SoftBank mints QuintoAndar a new unicorn in Latin American real estate tech

Dismantling the myths around raising your first check

Published May 27, 2021

As startups and venture capital grow in tandem, fundraising has gone from a formal affair on Sand Hill Road to a process that can happen anywhere from Twitter to Zoom.

While fundraising may no longer require a trip to California, it might depend on whether you got an invite to a private audio app. And while you may not need to be an insider, second-time founders — largely male and white — still have a competitive advantage.

If your intention is to build a company that you want to own and run indefinitely, and/or to grow more slowly and take fewer risks, traditional venture capital is not right for what you want to build.

The growing complexity of fundraising has the opportunity to make tech either inclusive or exclusive. For new founders looking to raise money, let’s dismantle the myths about raising your first check and instead focus on how investors and other successful founders describe the nuance needed to secure money.

What makes my business venture-worthy?

This question is existential, but it should be at the forefront throughout your journey as a founder. Elizabeth Yin, founding partner of Hustle Fund, says startups should be able to hit one of two goals: Reach $100 million ARR by its fifth year or get to $1 billion in valuation in the same time period.

“This is hard to do. And most businesses will never get there — not for a lack of trying — but there’s a lot of luck whether your idea has that much demand that quickly,” she added.

“I think you will know in the first year or two how ‘easy’ or ‘hard’ it is to get customers and whether you think on that trajectory you can get to $100 million a year in a few years,” Yin said. “And if it’s really hard, it doesn’t mean you throw in the towel. … There are many great companies that are not VC-backable where the founders will make a lot of money, but it just means you need to think through where to get your financing. Perhaps it’s from angels. Perhaps it’s from revenue-based financing funds. Perhaps it’s from customer crowdfunding.”

While VC is the flashy gold medal, the rapid growth of emerging fund managers means that a first check can be piecemealed together from a variety of different sources. The options for financing are seemingly endless: syndicates, public crowdfunding, VC firms, accelerators, debt financing, rolling funds, and, for the profitable few, bootstrapping.

“When people go around saying, ‘Do you want to run a VC-backable company?’ that feels weird — you don’t necessarily get to pick how fast you can grow — the market just may or may not be there,” Yin said. “There’s a lot of luck with that.”

Leslie Feinzaig, founder of Female Founders Collective, said that beyond economics, the hardest part of knowing whether your startup makes sense as a VC-backed business is understanding your own goals as an entrepreneur.

Box beats expectations, raises guidance as it looks for a comeback

Published May 27, 2021

Box executives have been dealing with activist investor Starboard Value over the last year, along with fighting through the pandemic like the rest of us. Today the company reported earnings for the first quarter of its fiscal 2022. Overall, it was a good quarter for the cloud content management company.

The firm reported revenue of $202.4 million, up 10% compared to its year-ago result, numbers that beat Box projections of between $200 million to $201 million. Yahoo Finance reports the analyst consensus was $200.5 million, so the company also bested street expectations.

The company has faced strong headwinds the past year, in spite of a climate that has been generally favorable to cloud companies like Box. A report like this was badly needed by the company as it faces a board fight with Starboard over its direction and leadership.

Company co-founder and CEO Aaron Levie is hoping this report will mark the beginning of a positive trend. “I think you’ve got a better economic climate right now for IT investment. And then secondarily, I think the trends of hybrid work, and the sort of long-term trends of digital transformation are very much supportive of our strategy,” he told TechCrunch in a post-earnings interview.

While Box acquired e-signature startup SignRequest in February, it won’t actually be incorporating that functionality into the platform until this summer. Levie said that what’s been driving the modest revenue growth is Box Shield, the company’s content security product and the platform tools, which enable customers to customize workflows and build applications on top of Box.

As activist investors loom, what’s next for Box?

The company is also seeing success with large accounts. Levie says that he saw the number of customers spending more than $100,000 with it grow by nearly 50% compared to the year-ago quarter. One of Box’s growth strategies has been to expand the platform and then upsell additional platform services over time, and those numbers suggest that the effort is working.

While Levie was keeping his M&A cards close to the vest, he did say if the right opportunity came along to fuel additional growth through acquisition, he would definitely give strong consideration to further inorganic growth. “We’re going to continue to be very thoughtful on M&A. So we will only do M&A that we think is attractive in terms of price and the ability to accelerate our roadmap, or the ability to get into a part of a market that we’re not currently in,” Levie said.

A closer look at the financials

Box managed modest growth acceleration for the quarter, existing only if we consider the company’s results on a sequential basis. In simpler terms, Box’s newly reported 10% growth in the first quarter of its fiscal 2022 was better than the 8% growth it earned during the fourth quarter of its fiscal 2021, but worse than the 13% growth it managed in its year-ago Q1.

With Box, however, instead of judging it by normal rules, we’re hunting in its numbers each quarter for signs of promised acceleration. By that standard, Box met its own goals.

How did investors react? Shares of the company were mixed after-hours, including a sharp dip and recovery in the value of its equity. The street appears to be confused by the results, weighing the report and working out whether its moderately accelerating growth is sufficiently enticing to warrant holding onto its equity, or more perversely if its growth is not expansive enough to fend off external parties hunting for more dramatic changes at the firm.

KKR hands Box a $500M lifeline

Sticking to a high-level view of Box’s results, apart from its growth numbers Box has done a good job shaking fluff out of its operations. The company’s operating margins (GAAP and not) improved, and cash generation also picked up.

Perhaps most importantly, Box raised its guidance from “the range of $840 million to $848 million” to “$845 to $853 million.” Is that a lot? No. It’s +$5 million to both the lower and upper-bounds of its targets. But if you squint, the company’s Q4 to Q1 revenue acceleration, and upgraded guidance, could be an early indicator of a return to form.

Levie admitted that 2020 was a tough year for Box. “Obviously, last year was a complicated year in terms of the macro environment, the pandemic, just lots of different variables to deal with…” he said. But the CEO continues to think that his organization is set up for future growth.

Will Box manage to perform well enough to keep activist shareholders content? Levie thinks if he can string together more quarters like this one, he can keep Starboard at bay. “I think when you look at the next three quarters, the ability to guide up on revenue, the ability to guide up on profitability. We think it’s a very very strong earnings report and we think it shows a lot of the momentum in the business that we have right now.”

Aaron Levie: ‘We have way too many manual processes in businesses’

On-demand grocery startup Food Rocket launches in the Bay Area, goes up against delivery giants

Published May 27, 2021

On-demand grocery startups like Gorillas are invading Europe right now, but although on-demand-everything is kinda old-hat in the Bay Area, a new startup thinks it might just be able to do something new.

Food Rocket says it has raised a $2 million investment round from AltaIR Capital, Baring Vostok fund and the Angelsdeck group of business angels, including Philipp Bashyan, of Russia’s Yonder, who has joined as an investor and advisor.

Yes, admittedly, this tiny startup is competing with DoorDash, GoPuff, InstaCart and Amazon Fresh. Maybe let’s not get into that…

Using the company’s mobile app, users can order fresh groceries, ready-to-eat meals and household goods that will be delivered within 10-15 minutes, says the startup, which will be servicing SoMa, South Park, Mission Bay, Japantown, Hayes Valley and other areas. The company hopes to open 150 “dark stores” on the West Coast as part of its infrastructure.

Vitaly Aleksandrov, CEO, and co-founder of Food Rocket, said: “The level of competition in this market in the U.S. is still manageable, which is why we have the opportunity to become leaders in the sphere of fast delivery of basic products and household goods. We aim to replace brick-and-mortar supermarkets and to change consumers’ current habits in regards to grocery shopping.”

What can we say? Good luck?

Who’s building the grocery store of the future?

Orbiit raises seed funding to automate the interactions within an online community

Published May 27, 2021

Orbiit, a startup that automates the interactions within an online community, has raised a $2.7 million round led by Bread and Butter Ventures, with participation from new investors High Alpha Capital, LAUNCHub Ventures and Company Ventures. Existing investors Founders Fund, which led Orbiit’s $1 million pre-seed round, Acceleprise and other angels also participated. The capital will be used to build out the Orbiit product and engineering team.

Orbiit says its platform handles the communications, matching, scheduling, feedback collection and analytics for people connecting with each other in an online community. The idea is that the communities therefore learn and network better, engage more and share more knowledge.

CEO and co-founder Bilyana Freye said: “Tailored 1:1 connections allow members to discuss difficult topics, be vulnerable and share learnings with one another. Those 1:1 connections are the hardest to execute, but when you start investing in them, with the help of Orbiit, you see engagement feeding into all other initiatives and a vibrant, active community that truly delivers on the promise to its members.”

Bread and Butter Ventures Managing Partner Mary Grove added: “This age-old question of how to leverage technology at scale to drive meaningful connections across communities both internal to an organization and across the globe is a problem we’ve been actively seeking a solution to for a decade. Orbiit brings the perfect blend of tech-enabled software with human curation to create strong connections and provide insights back to community managers.”

The platform is being used by startup communities at True Ventures, GGV and Lerer Hippeau; private networking groups such as Dreamers & Doers; and customer communities, like the CFO community run by fintech leader Spendesk.

Founders Fund Principal Delian Asparouhov said: “We see Orbiit as a key platform for peer learning within companies and communities, unlocking untapped knowledge through curated matchmaking.”

LAUNCHub Ventures participated in the round, following the recent first close of its new $70 million fund.

LAUNCHub Ventures heading towards a $85M fund for South Eastern European startups

CorrActions raises $2.7M to help avoid errors in human-machine interactions

Published May 27, 2021

CorrActions, a noninvasive neuroscience startup that uses sensor data to evaluate a user’s cognitive state due to drowsiness, alcohol, fatigue and other issues, today announced that it has raised a $2.7 million seed round. Early-stage fund VentureIsrael, seed fund Operator Partners and the Israeli Innovation Authority are backing the company, which is based out of OurCrowd’s Labs/02 incubator.

The idea here is to use touch sensors wherever humans may interact with machines, be that in a fighter jet’s cockpit, a car or anywhere else where knowing a user’s cognitive state could prevent potentially catastrophic errors. CorrActions promises that its proprietary algorithms can identify the user’s cognitive state and detect errors 150 milliseconds before they occur by “decoding unconscious brain signals through body motion monitoring.” For the most part, the system is use-case agnostic since it’s basically a generic platform that is independent of where it is implemented.

“Using sensors that already exist in nearly every electronic device like smartwatches, smartphones and even steering wheels and joysticks, CorrActions is the first in the world to be able to read a person’s cognitive state at any given moment by analyzing micro changes in their muscular activity,” explained Eldad Hochman, the company’s co-founder and CSO. “It is enough for the person to come in contact with an electronic device for two minutes and we can accurately quantify cognitive state and even predict a rapid deterioration, which may lead to failure or accidents. We can see this coming seconds before it occurs. This means that we can quantify the level of fatigue, intoxication, exhaustion or lack of concentration at any given moment.”

A lot of modern cars already feature sensors that can monitor your alertness, of course, and so it’s maybe no surprise that CorrActions is already working on proofs of concept with a few players in the automotive industry. In addition, it is also working on projects with the defense industry to show that its systems can assess a pilot’s performance, for example. But Hochman also believes that the company’s algorithms may be able to alert athletes or the elderly when they may be at risk of injury and falls.

The company says it will use the new funding to further develop its algorithms and support its current deployment partners, especially in the automotive industry.

“We are developing, and already seeing significant results for a technology which has the potential to save companies man-hours and money by preventing basic operational errors,” said CorrActions co-founder and CEO Zvi Ginosar. “Moreover, the application of our platform can be used to save lives, and prevent thousands of accidents and errors. In the next months we hope to be able to report more ground-breaking results and proof of concept trials, and this funding will greatly help us reach this goal.”

‘It’s almost like placing an IV’: Brain monitoring electrode receives FDA 510(k) clearance

Augmented reality NFT platform Anima gets backing from Coinbase

Published May 27, 2021

Augmented reality and non-fungible tokens, need I say more? Yes? Oh, well NFTs have certainly had their moment in 2021, but the question of what they do or what can be done with them has certainly been getting voiced more frequently as the speculative gold rush begins to cool off and people start to think more about how digital goods can evolve in the future.

Anima, a small creative crypto startup built by the founders of photo/video app Ultravisual, which Flipboard acquired back in 2014, is looking to use AR to shift how NFT art and collectibles can be viewed and shared. Their latest venture is an effort to help artists bring their digital creations to a bigger digital stage and help find what the future of NFTs looks like in augmented reality.

The startup has put together a small $500K pre-seed round from Coinbase Ventures, Divergence Ventures, Flamingo DAO, Lyle Owerko and Andrew Unger.

“As NFTs move away from being a more speculative market where it’s all about returns on your purchases, I think that’s healthy and it’s good for us specifically because we want to make things that are more approachable,” co-founder Alex Herrity says.

The NFT craze will be a boon for lawyers

Their broader vision is finding ways for digital objects to interact with the real world, something that’s been a pretty top-of-mind concern for the AR world over the last few years, though augmented reality development has cooled more recently as creators have sunk into a wait-and-see attitude toward new releases from Apple and Facebook. Both the AR and NFT spaces are incredibly early, something Anima’s co-founders were quick to admit, but they think both spaces have matured enough that the gimmicks are out in the open.

“There’s a context shift that happens when you see AR as a vehicle to have a tactile relationship with something that you collected or that you see is a lifestyle accessory versus the common thing now where it’s a little bit more of an experiential gimmick,” co-founder Neil Voss tells TechCrunch.

The team has worked with a couple artists already as they’ve made early experiments in bringing digital art objects into AR and they’re launching a marketplace late next month based on ConsenSys’s Palm platform, where they hope to showcase more of their future partnerships.

ConsenSys launches a more energy-efficient NFT ecosystem with a project from artist Damien Hirst as its first drop

Just 12 hours left to apply to Startup Battlefield at TC Disrupt 2021

Published May 27, 2021

We’ve been urging you to apply to Startup Battlefield at TechCrunch Disrupt 2021 for weeks now, and you have just over 12 hours left before the application window slams shut on May 27 at 11:59 p.m. (PT). Don’t procrastinate — the experience alone, whether you win the $100,000 prize or not, can improve the trajectory of your business.

Case in point: Mollie Breen started out as a mathematician at the National Security Agency before co-founding an IoT/OT security startup called Perygee. She and her team competed in Startup Battlefield last year at Disrupt 2020. Although they didn’t reach the finals, Breen has plenty to say about the experience. Here’s what she shared with us in a quick Q&A.

TC: Why did you apply to Startup Battlefield?

Breen: I admired the leadership and growth of other companies that, at one point, were Startup Battlefield contestants. I noticed they had similar traction to us when they applied, and their products resembled ours in their ability to disrupt the respective industry.

TC: What was the training process like?

Breen: It was incredibly valuable both in the short term and long term. Every team gets a weekly session with the Battlefield editor. Together you rehearse and go over every iteration of the pitch line-by-line and slide-by-slide. After each session, I walked away with constructive feedback on everything — the content, the speaking style and even the font color on a particular slide.

This was a unique opportunity, and we put in extra hours to be ahead of schedule, sent drafts for review in the off hours and even doubled down on additional practice with Q&As. As a result, we couldn’t have been more prepared for pitch day. And the training has stayed with Perygee well past the sessions and the competition.

TC: What did it feel like to pitch at Disrupt?

Breen: Pitching at Disrupt was, in some ways, like other pitches except that you have an international audience. Since, at that point, we had practiced our pitch dozens of times, the real unknown during the competition was the Q&A with the VC judges.

There was additional pressure to answer succinctly and convincingly within a time constraint that you wouldn’t have during a normal one-on-one pitch. But with the prep help from the TechCrunch team, I felt ready to speak in front of such a large audience. I encourage anyone who might be nervous about the big stage to go for it and trust you’ll have more than enough preparation when you get there.

TC: What was the post-pitch impact? Did you meet investors, press or other key partners?

Breen: It helped accelerate our progress. Following Battlefield, we closed an oversubscribed fundraising round. We acquired additional beta users, including our first beta user who messaged us after reading about Perygee on TechCrunch. We also gained numerous press opportunities to share our story.

It’s almost a year since Startup Battlefield, and I’m still impressed by how many people start the conversation saying they watched the pitch while reading our company’s background. It’s a reminder that the opportunities created by being a TechCrunch Battlefield company continue.

TC: Do you have any great news to share since your pitch?

Breen: At TechCrunch Battlefield we were a small team doing MVP testing and just about to start raising. Since the pitch, we have scaled on all fronts. We grew the founding team and the engineering team, and we deployed the product to enterprise networks. Some of those deployments include contacts who reached out because of TechCrunch — and we raised our seed round!

TC: Is there anything else you’d like to share?

Breen: I’m grateful for the camaraderie and relationships we developed with the other teams. What you didn’t see on stage during the pitches was all of us cheering one another on from the group chat or social media feed. Even now, we continue to support one another through navigating business questions or promoting product launches. If it weren’t for Startup Battlefield, I would never have met this awesome group of startups.

You have just 24 hours left to channel your inner Mollie Breen. Apply to Startup Battlefield before the deadline expires on May 27 at 11:59 p.m. (PT). Get moving!

Breinify announces $11M seed to bring data science to the marketing team

Published May 27, 2021

Breinify is a startup working to apply data science to personalization, and do it in a way that makes it accessible to nontechnical marketing employees to build more meaningful customer experiences. Today the company announced a funding round totaling $11 million.

The investment was led by Gutbrain Ventures and PBJ Capital with participation from Streamlined Ventures, CXO Fund, Amino Capital, Startup Capital Ventures and Sterling Road.

Breinify co-founder and CEO Diane Keng says that she and co-founder and CTO Philipp Meisen started the company to bring predictive personalization based on data science to marketers with the goal of helping them improve a customer’s experience by personalizing messages tailored to individual tastes.

“We’re big believers that the world, especially consumer brands, really need strong predictive personalization. But when you think about consumer big brands or the retailers that you buy from, most of them aren’t data scientists, nor do they really know how to activate [machine learning] at scale,” Keng told TechCrunch.

She says that she wanted to make this type of technology more accessible by hiding the complexity behind the algorithms powering the platform. “Instead of telling you how powerful the algorithms are, we show you [what that means for the] consumer experience, and in the end what that means for both the consumer and you as a marketer individually,” she said.

Marketing in 2021 is emotional and not just transactional

That involves the kind of customizations you might expect around website messaging, emails, texts or whatever channel a marketer might be using to communicate with the buyer. “So the AI decides you should be shown these products, this offer, this specific promotion at this time, [whether it’s] the web, email or SMS. So you’re not getting the same content across different channels, and we do all that automatically for you, and that’s [driven by the algorithms],” she said.

Breinify launched in 2016 and participated in the TechCrunch Disrupt Startup Battlefield competition in San Francisco that year. She said it was early days for the company, but it helped them focus their approach. “I think it gave us a huge stage presence. It gave us a chance to test out the idea just to see where the market was in regards to needing a solution like this. We definitely learned a lot. I think it showed us that people were interested in personalization,” she said. And although the company didn’t win the competition, it ended up walking away with a funding deal.

Today the startup is growing fast and has 24 employees, up from 10 last year. Keng, who is an Asian woman, places a high premium on diversity.

“We partner with about four different kinds of diversity groups right now to source candidates, but at the end of the day, I think if you are someone that’s eager to learn, and you might not have all the skills yet, and you’re [part of an under-represented] group we encourage everyone to apply as much as possible. We put a lot of work into trying to create a really well-rounded group,” she said.

Breinify tells online retailers what customers want to buy at a specific point in time

RevenueCat raises $40M Series B for its in-app subscription platform

Published May 27, 2021

RevenueCat, a startup offering a series of tools for developers of subscription-based apps, has raised $40 million in Series B funding, valuing its business at $300 million, post-money. Founded by developers who understood the difficulties in scaling a subscription app firsthand, RevenueCat’s software development kit (SDK) solution gives companies the tools they need to build a subscription business, including not just adding subscriptions themselves, but maintaining them over time even as the app stores implement changes. It also aids by sharing subscription data with other tools the business uses, like those for advertising, analytics or attribution.

The funding round was led by Y Combinator’s Continuity Fund and included participation from Index Ventures, SaaStr, Oakhouse, Adjacent and FundersClub, as well as Blinklist CTO Tobias Balling and Algolia CEO Nicolas Dessaigne. With the round, YC Continuity Partner Anu Hariharan is joining RevenueCat’s board, which today includes Index’s Mark Fiorentino in addition to the founders.

Explains RevenueCat CEO Jacob Eiting, the idea for the company came about after he and co-founder Miguel Carranza Guisado (CTO) struggled to figure out subscription infrastructure while working together at Elevate. After years of untangling a “subscription mess” in order to figure out answers to basic questions like subscriber retention and lifetime value, they realized there was potential in helping solve this problem for other developers.

Apple and Google, Eiting explains, aren’t always up to date with what companies actually need to build subscription businesses. “They’re kind of learning as they go. They just weren’t able to provide us the data we needed, and then also the infrastructure to do that is non-trivial.”

Image Credits: RevenueCat

When Eiting and Guisado sat down to work on RevenueCat in 2017, no one else was even building anything like this. But the demand for the startup’s tools and integrations soon resonated with developers who had faced similar challenges in the growing subsection app market.

Using the service, developers can access a real-time dashboard that display key metrics, like subscription revenue, churn, LTV (lifetime value), subscriber numbers, conversions and more. The data can then be shared through integrations with other tools and services, like Adjust, Amplitude, Apple Search Ads, AppsFlyer, Branch, Facebook Ads, Google Cloud Intercom, Mixpanel, Segment and several others.

After launching out of Y Combinator’s accelerator the following year, RevenueCat was soon live with 100 apps and had crossed $1 million in tracked revenue by the time it raised its $1.5 million seed round.

Today, RevenueCat has more than 6,000 apps live on its platform, with over $1 billion in tracked subscription revenue being managed by its tools. That’s double the number of apps that were using its service as of its $15 million Series A last August.

With the additional funding, the company will lower its pricing to put its tools in reach of more developers. Previously, it charged $120 per month for its charts and some of its integrations, or $499 per month for access to all integrations. This was affordable for larger companies, but could still be a difficult sell to the long tail of app developers where revenues ranged from $10K to $50K per month.

Now, RevenueCat will charge a small percentage of an app’s sales instead of a flat fee. Developers with up to $10,000 in monthly tracked revenue (MTR) can get started with the service for free and as their demands grow — like needing access to charts, support for web hooks, integrations and others — they can move up to either the Starter or Pro plans as $8/mo or $12/mo per $1,000 in MTR, respectively.

“I’m excited to give those tools to developers, especially on the small end, because it might be what they need to get out of that ‘less than $10K range,’ ” Eiting says. “Also, the beauty of freemium, or having a really generous free tier, is that it makes your tool the de facto — you remove as much friction as possible for providing software services and then, if you get your pricing right — which I think we have — it all kind of pays for itself,” he adds.

The company also plans to use the new funds to further invest in its business, expanding from App Store and Google Play support to include Amazon’s Appstore. It will also grow its team.

As part of its expected growth, RevenueCat recently hired a head of Product, Jens-Fabian Goetzmann, previously a PM at Microsoft and then product head at fitness app 8fit. Currently 30 people, in the year ahead, RevenueCat will grow to 60 people, hiring across design, product, engineering, sales and other roles.

“The world is moving toward subscriptions — and for companies, building out this model translates to weeks of developers’ time,” says YC Continuity’s Hariharan. “RevenueCat helps developers roll out subscriptions in minutes and creates a source of truth for customer data. With developers creating solutions to problems in the world, it’s important that they can find ways to monetize, grow, and support their most committed customers. RevenueCat is doing so by building subscriptions 2.0.”