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Creator monetization and CRM startup Pico raises $6.5M

Published April 14, 2021

Pico, a New York startup that helps online creators and media companies make money and manage their customer data, announced today that it has launched an upgraded platform and raised $6.5 million in new funding.

In a statement, the startup’s co-founder and CEO Nick Chen said Pico helps creators with their two biggest problems — “how to make money more easily and how to get to know your audience better” — while also giving them control over their two most important assets, namely “your brand and the relationship to your audience.”

The company provides a long list of different tools, including landing pages, pop-ups to collect email addresses, paid newsletters, subscription paywalls, tiered membership programs, recurring and one-time donations and video revenue tools. With version 2.0, the company says it’s bringing all these features together with a unified data structure, so that customers can see “who is paying for what content and where they came from” in one dashboard.

Via email, co-founder and President Jason Bade (pictured above with Chen) pointed to “the power of our CRM to help creators understand their audience” as the most significant upgrade, suggesting that this “makes Pico the operating system for the creator economy.”

Image Credits: Pico

“A creator can’t scale a business without the proper tools,” Bade continued. “Take email capture, that is the first step in audience development. But what next? You need data and a CRM to handle it. 2.0 upgrades every part of Pico to rearchitect it for the scalability and extensibility that the creator economy demands.”

Pico also said it will be launching an API soon to support integrations with different parts of the platform.

Apparently, the company has seen its customer count increase nearly 5x in the past year, with customers including The Colorado Sun, Defector Media and The Generalist. And it recently recruited Rodolphe Ködderitzsch (who held a number of roles at YouTube, including global head of partner sales) as its chief revenue officer.

The new funding was led by Ann Lai at Bullpen Capital and brings Pico’s total funding to $10 million. Other investors include Precursor Ventures, Stripe, BloombergBeta and Village Global.

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

Stripe and Precursor lead $4.5M seed into media CRM startup Pico

Dell is spinning out VMware in a deal expected to generate over $9B for the company

Published April 14, 2021

Dell announced this afternoon that it’s spinning out VMware, a move that has been suspected for some time. Dell acquired VMware as part of the massive $58 billion EMC acquisition (announced as $67 billion) in 2015.

The way that the deal works is that Dell plans to offer VMware shareholders a special dividend of between $11.5 and $12 billion. As Dell owns approximately 81% of those shares that would work out to somewhere between $9.3 and $9.7 billion coming into Dell’s coffers when the deal closes later this year.

“By spinning off VMware, we expect to drive additional growth opportunities for Dell Technologies as well as VMware, and unlock significant value for stakeholders. Both companies will remain important partners, with a differentiated advantage in how we bring solutions to customers,” Dell CEO Michael Dell said in a statement.

$67 billion Dell-EMC deal closes today

While there is a fair amount of CEO speak in that statement, it appears to mean that the move is mostly administrative as the companies will continue to work closely together, even after the spin-off is official. Dell will remain as chairman of both companies.

In a presentation to investors, the companies indicated that the plan to work together is more than lip service. There is a five-year deal commercial agreement in place with plans to revisit that deal each year thereafter. In addition, there is a plan to sell VMware products through the Dell sales team and for VMware to continue to work with Dell Financial Services. Finally, there is a formalized governance process in place related to achieving the commercial goals under the agreement, so it’s pretty firm that these companies will continue to work closely together at least for another five years.

For its part, VMware said in a separate release that the deal will allow it “increased freedom to execute its strategy, a simplified capital structure and governance model and additional strategic, operational and financial flexibility, while maintaining the strength of the two companies’ strategic partnership.”

Dell shares are up more than 8% following the announcement. The company intends on using parts of its proceeds to deleverage, writing in a release that it will use “net proceeds to pay down debt, positioning the company well for Investment Grade ratings.” By that it means that Dell will reduce its net debt position and, it hopes, garner a stronger credit rating that will limit its future borrowing costs.

Unpacking how Dell’s debt load and VMware stake could come together

Even when it was part of EMC, VMware had a special status in that it operates as a separate entity with its own executive team and board of directors, and the stock has been sold separately as well.

The deal is expected to close at the end of this year, but it has to clear a number of regulatory hurdles first. That includes garnering a favorable ruling from the IRS that the deal qualifies for a tax-free spin-off, which could prove to be a considerable hurdle for a deal like this.

The transaction is not a surprise. The company has been open about its intention to shake up its broader corporate structure. And with Dell bloated in debt terms and, perhaps, in product scope as well, the VMware deal could be an intelligent way forward. Dell investors are more excited about the transaction than VMware shareholders, with the latter company’s stock is up a more modest 1.4%.

VMware’s most recent earnings release notes that it had $4.715 billion in “total cash, cash equivalents and short-term investments.” Perhaps its shareholders aren’t enthused at the prospect of levering VMware’s balance sheet to help Dell do the opposite.

Dell’s debt hangover from $67B EMC deal could put VMware stock in play

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

Published April 14, 2021

A few years ago, founder Sean Lane thought he’d achieved product-market fit.

Speaking to attendees at TechCrunch’s Early Stage virtual event, Lane said Queue, a secure digital check-in tablet for hospital waiting rooms that reduced wait times by uniting and correcting electronic medical records, was “selling like hotcakes.” But once Lane realized it would only ever address one piece of a much bigger market opportunity, he sold off the product, laid off two-thirds of the people affiliated with it and redirected the employees who were left.

Lane explained that what he really wanted to build is what his company — since renamed Olive — has now become, a robotic process automation (RPA) company that takes on hospital workers’ most tedious tasks so nurses and physicians can spend more time with patients.

Customers seem to like it. According to Lane, more than 600 hospitals use the service to assist employees with tasks like prior authorizations and patient verifications.

Investors clearly approve of what Olive is selling, too: Last year, the company raised three rounds of funding totaling roughly $380 million and valuing the company at $1.5 billion. According to Crunchbase, it’s raised a total of $456 million altogether.

In fact, VCs think so much of Lane that in February, they invested $50 million in another company that Lane runs simultaneously called Circulo, a startup that describes itself as building the “Medicaid insurance company of the future.”

Still, the path from point A to B was painful, and it might not have happened if Lane didn’t have a few things going for him, including a deeply personal reason to build something that could have greater impact on the U.S. healthcare system.

TikTok funds first episodic public health series ‘VIRAL’ from NowThis

Published April 14, 2021

TikTok is taking another step toward directly funding publishers’ content with today’s announcement that it’s financially backing the production of media publisher NowThis’ new series, “VIRAL,” which will feature interviews with public health experts and a live Q&A session focused on answering questions about the pandemic. The partnership represents TikTok’s first-ever funding of an episodic series from a publisher, though TikTok has previously funded creator content.

Through TikTok’s Instructive Accelerator Program, which was formerly known as the Creative Learning Fund, other TikTok publishers have received grants and hands-on support from TikTok so they could produce quality instructive content for TikTok’s #LearnOnTikTok initiative. The program today is structured as four eight-week cycles, during which time publishers post videos four times per week.

NowThis had also participated in the Creative Learning Fund last year and was selected for the latest cycle of the Instructive Accelerator Program. But its “VIRAL” series is separate from these efforts.

NowThis says it brought the concept for the show to TikTok earlier this year outside of the accelerator program, and TikTok greenlit it. TikTok then co-produced the series and provided some funding. Neither NowThis nor TikTok would comment on the extent of the financial backing involved, however.

The “VIRAL” series itself is hosted by infectious disease clinical researcher Laurel Bristow, who spent the last year working on COVID treatments and research. Every Thursday, Bristow will break down COVID facts in easy-to-understand language, NowThis says, including things like vaccine efficacy, transmission timelines and treatment. The show will also bust COVID myths, provide information about ongoing public health risks and feature interviews with a cross-section of experts.

Each episode will be 45 minutes in length and will also include an interactive segment where the TikTok viewing audience will be able to engage in a real-time Q&A session about the show’s content. In total, five episodes are being produced, and will air starting on Thursday April 15 at 6 PM ET and will run through Thursday May 13 on the @NowThis main TikTok page.

@nowthisTune in to our new TikTok live show VIRAL on Thursdays at 6pm ET with host @kinggutterbaby♬ original sound – nowthis

NowThis has become one of the most-followed news media accounts on TikTok, with 4.6 million followers across its news and politics channels, since launching a little over a year ago. Because of its focus on video, it’s been a good fit for the TikTok’s platform.

The approach TikTok is taking with “VIRAL’s” production, it’s worth noting, stands in contrast to how other social media platforms are handling the pandemic and COVID-19 information. While most, including TikTok, have pledged to fact-check COVID-19 information, remove misinformation and conspiracies, point users to official sources for health information and provide other resources, TikTok is directly funding public health content featuring scientists and researchers, and then promoting it on its network.

The company explained to TechCrunch its thinking on the matter.

“As the pandemic continues to evolve, we think it’s important to provide our community an outlet to dispel misinformation and communicate with public health experts in real time,” said Robbie Levin, manager of Media Partnerships at TikTok. “NowThis has consistently been a great partner that produces engaging and informative content, so we felt this series would be an impactful and important avenue for our users to receive credible information on our platform,” Levin noted.

Clubhouse promises its accelerator participants either brand deals or $5K per month during the program

While the pandemic has driven the topic of choice here, paying creators for content is not new. And TikTok isn’t the only one to do so. Instagram and Snapchat are both funding creator content for their TikTok clones, Reels and Spotlight, respectively. And new social platforms like Clubhouse are funding creators’ shows, as well.

TikTok says it’s not currently talking to other publishers to produce more series like “VIRAL,” but it isn’t ruling out the idea of expanding its creator funding and producing efforts. In addition to its accelerator program, which is continuing, TikTok says if “VIRAL” proves successful and the community responds positively, it will pursue similar opportunities in the future.

TikTok is a marketer’s shiny new toy, but how do you optimize campaigns?

Beat the deadline: Apply to compete in Startup Battlefield at TC Disrupt 2021

Published April 14, 2021

Startup Battlefield — the matriarch of all pitch competitions — is the stuff of tech legend. Heck, it even played a role in the HBO show, “Silicon Valley,” and its influence touches early-stage startups around the globe. Under no circumstance will you find a bigger, better platform for launching your startup to the world.

Battlefield has a long history of producing notable names. Need an example? A little startup by the name of Dropbox competed in the Battlefield at TC50 (the precursor to Disrupt) way back in 2008.

TechCrunch is on the hunt for innovative, game-changing startups to take the Startup Battlefield challenge and wrangle with the best-of-the-best at TC Disrupt 2021 in September. Are you game?

Apply to compete in Startup Battlefield before the deadline closes on May 13 11:59 pm (PT).

The stakes: A shot at $100,000 in equity-free prize money. Major exposure for all competing startups — think investors eager to find and fund the next big thing, journalists in search of exciting, game-changing startups to cover and potential customers and partners who can help take your business to new levels of success.

The investment: Your time. Yup, that’s it. Applying to and participating in Startup Battlefield is 100% free. No fees, no equity cut. You simply invest your time — all participating founders receive several weeks of training with the Startup Battlefield team. Your demo and presentation will be, well, pitch perfect when you deliver it to panels of top VC judges. And you’ll be thoroughly prepped to handle the Q&A that follows.

The perks: In addition to the massive interest from just about all Disrupt attendees, competing startups get exhibition space in the Startup Alley expo area, free passes to future TechCrunch events, a free membership to Extra Crunch and invitations to private events like the Startup Battlefield reception.

You’ll meet members of the Startup Battlefield alumni community — we’re talking about 922 companies (like Vurb, Mint, Yammer and, yes, Dropbox) that have collectively raised $9.5 billion and produced 117 exits. Once Disrupt ends, you’re part of this phenomenal community — just imagine the networking possibilities.

The details: Read more about how Startup Battlefield works.

Applications for Startup Battlefield at TC Disrupt 2021 are now open

TC Disrupt 2021 takes place September 21-23. If you’ve got an innovative, game-changing startup, apply to compete in Startup Battlefield. Make sure you submit your completed application before the deadline expires on May 13 11:59 pm (PT).

Is your company interested in sponsoring or exhibiting at Disrupt 2021? Contact our sponsorship sales team by filling out this form.

MIT startup Pickle raises $5.75M for its package-picking robot

Published April 14, 2021

There’s no doubt this past year has been a major watershed moment for the robotics industry. Warehouse and logistics have been a particular target for an automation push, as companies have worked to keep the lights on amidst stay at home orders and other labor shortages.

MIT spinoff Pickle is one of the latest startups to enter the fray. The company launched with limited funding and a small team, though it’s recently changed one of these, telling TechCrunch this week that it has raised $5.57 million in funding during this hot investment streak. The seed round was led by Hyperplane and featured Third Kind Venture Capital, Box Group and Version One Ventures, among others.

The company’s making some pretty big claims around the efficacy of its first robot named, get this, “Dill” (the company clearly can’t avoid a clever name). It says the robot is capable of 1,600 picks per hour from the back of a trailer, a figure it claims is “double the speed of any competitors.”

CEO Andrew Meyer says collaboration is a key to the company’s play. “We designed people into the system from the get-go and focused on a specific problem: package handling in the loading dock. We got out of the lab and put robots to work in real warehouses. We resisted the fool’s errand of trying to create a system that could work entirely unsupervised or solve every robotics problem out there.”

Orders for the first product targeted at trailer unloading will open in June, with an expected ship date of early 2022.

Why so many robotic startups fail, and what can be done about it

Alexa von Tobel outlines how founders should manage personal finances

Published April 14, 2021

Few people are more knowledgable on the topic of how founders should manage their finances than Alexa von Tobel. She is a certified financial planner, started her own company in the midst of the recession (which happened to be a wildly successful personal finance startup that sold for hundreds of millions of dollars) and is now a VC who invests and advises founders.

At Early Stage 2021, she gave a presentation on how founders should think about managing their own wealth. Startup founders can often put all their money into their venture and end up paying more attention to the finances of their company than their own bank account.

Von Tobel outlined the various steps you can take to stay out of debt, build credit and accumulate wealth through investments to ensure you have financial peace of mind as you take on the most stressful venture of your life: Starting a company.

Know your numbers

The first step in getting organized and being proactive is often taking inventory. Von Tobel believes that knowing your numbers and getting organized digitally is the first step to having financial peace of mind.

Know all your numbers. Know your net worth. What are your assets? What’s your debt? What does your total financial picture look like? Get everything online. You should have all the mobile apps downloaded so that, in minutes, you can actually see your full financial life. And keep it simple. Fewer accounts are better. I always tell people, if you have seven credit cards, plus three savings accounts, that’s a lot. You’re never going to be as good at managing your finances. Simplify your accounts. (Time stamp — 2:50)

Manage your credit and debt

Coinbase opens at $381 per share, valuing the crypto exchange at nearly $100B

Published April 14, 2021

Today shares of Coinbase began to trade after the company executed a direct listing. From a reference price of $250, Coinbase shares opened at $381 today, a change of around 52%. At its open Coinbase was valued at $99.6 billion on a fully diluted basis. As of the time of writing Coinbase has appreciated further to just over $400 per share, valuing the company at a touch more than $104 billion.

Coinbase was worth $65.3 billion at its reference price, on a fully diluted basis.

Coinbase’s debut has been hotly anticipated, thanks to its position inside the greater crypto economy and, from a purely startup perspective, its huge value unlock. Private investors poured capital into the company during its life as a private company, valuing it as high as $8 billion.

The company’s new valuation dwarfs that prior figure, implying strong returns for its long-term backers. Today even regular folks could get a scratch at the company’s equity, and they were willing to pay up for the privilege. TechCrunch asked its audience about the debut, pre-trading results that served as an anti-indicator of where the crypto-unicorn’s shares would trade:

Would you pay more or less than $250/share for Coinbase? (read up on today’s direct listing: https://t.co/xd8xP4YwWX)

— Extra Crunch (@ExtraCrunch) April 14, 2021

For Coinbase the road ahead is interesting. The company is richly capitalized and posted monster profits in its most recent quarter. However, Coinbase has yet to chart a future sufficiently delinked from the impacts of cryptocurrency price levels and resulting trading volume to be immune to a potential setback in growth and income if the value of bitcoin, et al. dropped.

But for crypto believers, watching Coinbase list is a win; it is ironic that a traditional company listing on an old-fashioned exchange is a key moment for the crypto economy, but most things come in steps. Perhaps the next major crypto company trading debut will be on a decentralized exchange.

Five takeaways from Coinbase’s S-1

Zeta in talks with SoftBank to raise at over $1 billion valuation

Published April 14, 2021

Banking tech startup Zeta is inching closer to the much sought-after unicorn status as it engages with investors to finalize a new round, two sources familiar with the matter told TechCrunch.

SoftBank Vision Fund 2 is in advanced stages of talks to lead a ~$250 million Series D round in the five-year-old startup, the sources said. The investment proposal values the Indian startup, co-founded by high-profile entrepreneur Bhavin Turakhia, at over $1 billion, up from $300 million in its maiden external funding (Series C) in 2019.

The round has yet to close, a third person said.

A SoftBank spokesperson declined to comment.

Five-year-old Zeta helps banks launch modern retail and fintech products. The thesis is that banks — largely operating on antiquated technologies — today don’t have the time and expertise to offer the best experience to hundreds of millions of customers and fintech firms they serve.

Zeta is attempting to help banks either use the startup’s cloud-native, API-first banking stack as its core framework or build services atop it to offer better a experience to all customers — think of improved mobile app and debit and credit features. It also offers API, SDKs and payment gateways to banks to work more efficiently with fintech firms.

The startup has amassed clients in several Asian and Latin American markets.

Turakhia, with his brother Divyank, started his first venture in 1998. Along the way, they sold four web companies to Endurance for $160 million. Zeta is the third startup Bhavin has co-founded since then — the other being business messaging platform Flock and Radix.

When the deal is finalized, Zeta would join a growing list of Indian startups that have turned a unicorn in recent months. Last week, social commerce Meesho — also backed by SoftBank Vision Fund 2 — fintech firm CRED, e-pharmacy firm PharmEasy, millennials-focused Groww, business messaging platform Gupshup and social network ShareChat attained the unicorn status.

The story was updated with additional details and to note that the round hasn’t closed.

How Pilot charted a course of not raising too much money

Published April 14, 2021

A few weeks ago, we wrote about fintech Pilot raising a $100 million Series C that doubled the company’s valuation to $1.2 billion.

Bezos Expeditions — Amazon founder Jeff Bezos’ personal investment fund — and Whale Rock Capital joined the round, adding $40 million to a $60 million raise led by Sequoia about one month prior.

That raise came after a $40 million Series B in April 2019 co-led by Stripe and Index Ventures that valued the company at $355 million.

Both raises were notable and warranted coverage. But sometimes it’s fun to take a peek at the stories behind the raises and dig deeper into the numbers.

So here we go.

Jeff Bezos’ investment fund is backing a startup hoping to be the AWS for SMB accounting

First off, San Francisco-based Pilot — which has a mission of affordably providing back-office services such as bookkeeping to startups and SMBs — apparently had term sheets that offered “2x the $40M” raised in its Series B. But it chose not to raise so much capital.

I also heard that the same investor that ended up leading a now defunct competitor’s $60 million raise first asked to invest $60 million in Pilot as a follow-on to that Series B prior to making the other investment. While I don’t know for sure, I can only presume that what is being referred to is ScaleFactor’s $60 million Series C raise in August 2019 that was led by Coatue Management. (ScaleFactor crashed and burned last year.)

According to CFO Paul Jun: “There were many periods when Pilot turned away new customers and growth capital instead of absolutely maximizing short-term growth…Pilot prioritized building the foundational investments needed for scalability, reliability and high velocity. When it was presented with the opportunity for additional funding towards further growth in 2019, it declined to do so.”

Co-founder and CEO Waseem Daher elaborates, pointing out that the first company that Pilot’s founding team ran, Ksplice, was bootstrapped before getting acquired by Oracle in 2011. (It’s also worth noting that the founding team are all MIT computer scientists.)

“Ultimately, the reason to raise money is you believe that you can deploy the capital, to grow the company or to basically cause the company to grow at the rate you’d like to grow. And it doesn’t make sense to raise money if you don’t need it, or don’t have a good plan for what to do with it,” Daher told TechCrunch. “Too much capital can be bad because it sort of leads you to bad habits…When you have the money, you spend the money.”

So despite what he describes as “a great deal of institutional interest” in 2019, Pilot opted to raise just $40 million, instead of $80 million to $100 million, because it was the amount of capital the company had confidence that it could deploy successfully.

Pilot CEO Waseem Daher tears down his company’s $60M Series C pitch deck

Also, Jun shared some numbers beyond the recent raise amount and valuation.

The company has tripled revenue every year since inception, except for 2020 when it doubled revenue.
Pilot claims to have had a cash burn of $800,000 per month in 2020 against a starting balance of $40 million.
The startup touts a 60% GAAP gross margin. Daher notes: “We feel really good about having long-term unit economics that will work for this business without resorting to offshoring or outsourcing in a way that could compromise quality and compromise relationships.”

Bottom line is companies don’t have to accept all the capital that’s offered to them. And maybe in some cases, they shouldn’t.