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The creator movement is entering prime time, and so is Circle with a fresh $4M

Published February 16, 2021

The creator movement has exploded in the last few years as platforms ranging from Substack to Clubhouse have made it easier than ever to reach an audience of willing readers and listeners. Yet the key to building sustainable creator businesses is the economics of these enterprises themselves. Get enough subscribers, and what often starts as a side hobby can quickly become a full-time job.

Circle was founded in January 2020 to make engaging with paying customers and thus building creator businesses as effortless as possible. We profiled the NYC-based startup last year when it announced its $1.5 million seed round in August, discussing how its founder DNA originates in the online course platform Teachable. Since then, all signs point to very strong early growth.

Creators need better community tools — Circle wants to fill the gap

The company surpassed $1 million ARR last month, and it already has 1,000 paying customers and is heading toward 2,000 paying communities. Usage is also growing rapidly, expanding 40-50% per month for both DAUs and MAUs, according to the company. It also brought its iOS app out of beta last month.

CEO and co-founder Sid Yadav said that “we happened to catch the tide at the right time [with] the creator movement, the community movement.” So far, paying communities have been largely centered around “a lot of YouTubers, course creators, Twitch streamers, Patreon personalities,” with Yadav estimating that 60% of the platform’s communities are “personality-led.” That said, “a lot of brands are starting to think of this creatively.”

All that positive news can’t be ignored by VCs too long. The company announced today that it has raised a $4 million seed round at a valuation “north of” $40 million, which closed late last year. The round was officially led by Notation Capital, which led the company’s pre-seed round last year, but the firm only took a quarter of a round according to Yadav.

Circle’s team has grown to 20 across multiple continents. Photo via Circle.

Instead, much of the round’s allocations were handed out to the entrepreneurs building on the platform. “We had all of these offers from top-tier firms, but for the kind of product that we are — which is a creator platform — it made sense to allocate the round as much as possible to our customers,” Yadav said. According to the company, a majority of the round went to individual angels and community builders on the platform, among them Anne-Laure Le Cunff, David Perell, Tiago Forte and Nat Eliason.

Given the company’s early stage, product development remains the highest priority. “Our approach is like a Notion,” Yadav said, describing how Circle allows its communities to stitch together “building blocks” to lay out pages. Circle’s primary mode is through a Space, where community members can discuss topics with each other and the creator as well. Communities built on Circle can be white-labeled, with their own custom domains.

Circle’s community platform allows creators to publish content and engage with their community. Photo via Circle.

Circle’s ultimate goal is to integrate under one roof every tool a creator needs to engage with a customer, from publishing newsletters and podcasts to setting up streaming, event ticket sales, merchandise and event calendars — all buttressed by a payments layer. Many of those features remain to be built on top of the company’s core community platform, but Yadav and his team are certainly ambitious in their expansive scope.

Circle’s team is now 20 people, with team members in Europe, India, Australia and across the United States.

Uber vet raises $5.2M for blue-collar logistics marketplace

Published February 16, 2021

After working as a general manager for Uber in Nevada, Jason Radisson realized the need for a way to connect blue-collar workers to companies looking to employ them.

So in late 2018, the idea for Shift One — a marketplace aimed at pairing workers and employers — was born. The startup is focused on last-mile logistics and delivery, e-commerce fulfillment and large-scale event management.

Since formally launching in 2019, Shift One has grown to have 25,000 workers on its platform — many of whom it says were unemployed at the time of hire. And it has about 50 clients in the U.S. and Colombia, including Amazon, NASCAR, Weee!, Mensajeros Urbanos and the Consumer Electronics Show (CES).

It matches employers with workers, and also helps them with tasks such as time, taxes, attendance, productivity and work-order management.

To help it grow and further expand its reach, Shift One just raised a $5.2 million seed round led by City Light Capital and Tinder co-founder Justin Mateen’s JAM fund, with participation from K50 Ventures, Ventura Investments and Human Ventures, as well as angel Felipe Villamarin.

On the operations side, all of Shift One’s original team either worked for Uber or Lyft, according to founder and CEO Radisson. The early technical team were all previously Uber employees.

Radisson says the impetus behind starting the company was the desire “to correct and improve some of the things in Gig 1.0.”

“We wanted it to be more balanced for workers, and break some negative flywheels where people were cycling through a lot of logistics jobs and not getting paid well,” he told TechCrunch. “We wanted to give them stability.”

At the same time, Radisson said, he knew that companies on the logistics side were struggling to find good workers. Shift One works with a range of skill levels, from entry-level employees to supervisors and warehouse managers.

Knowing that many logistics workers are used to working as contract employees with no benefits, Shift One gives all the workers on its platform full benefits with “low contributions” from the first day of hire. It also provides them with checking accounts and debit cards.

“A lot of these workers are unbanked and didn’t have the ability to even get a paycheck,” Radisson said.

It also aims to give them “full schedules” and have them work on whole teams as much as possible.

“It’s part of our value prop that our teams are cohesive and really high functioning,” he added.

An even bigger battle for gig worker rights is on the horizon

Until now, San Francisco-based Shift One has been bootstrapped. It is “slightly” profitable and has been re-investing that money into growing the business. It saw its revenue climb by tenfold in 2020 from an admittedly “small base.” The startup has offices in Las Vegas, Minneapolis, Bogotá and Bucharest.

Looking ahead, it plans to use its new capital to expand into new markets (it’s currently operating in about 12 states), boost its headcount of 20 and accelerate its tech roadmap.

“In the last four to five months, we’ve moved very strong into last mile” as the COVID-19 pandemic has continued, Radisson said. “We want to give opportunities to millions that didn’t go to college and that have seen stagnant wages for years. We want to give them opportunities to get ahead.”

JAM Fund principal and Tinder co-founder Mateen believes Shift One is turning the labor problem of “adverse selection” on its head.

“Gig work has been defined by seasonality and availability — neither are particularly good for workers,” he said.

Even Miami Mayor Francis Suarez has thoughts, pointing out that blue-collar jobs have been among the hardest hit by COVID-19.

With Shift One, “workers receive fairly compensated jobs with the opportunity to grow and develop,” he said in a written statement. “Companies get access to a steady, predictable source of high-quality labor. And Miami benefits from the virtuous circle of higher employment and strong local businesses.”

We’ll discuss the future of the gig economy and contract work at TC Sessions: Justice on March 3

Ad Practitioners acquires Knoq to move the startup’s door-to-door marketing approach online

Published February 16, 2021

Knoq (formerly known as Polis) was a startup that recruited representatives to go door-to-door in their neighborhoods, talking up client products and services. So for obvious reasons, it faced challenges in 2020.

“We stopped knocking on doors in February, and this summer, we were trying to figure out what the path forward was,” founder and CEO Kendall Tucker told me.

The company had already pivoted once, shifting focus from political work to commercial marketing. But Tucker said Knoq also had some attractive assets, namely its “unique, huge consumer models” designed to predict whether someone would be interested in a given product, as well as “the experience of building out these teams of neighborhood representatives.”

So after what she described as a competitive bidding process, Knoq was acquired by Ad Practitioners, a digital media company that owns properties like Money.com and ConsumersAdvocate.org.

As part of Ad Practitioners, Tucker said Knoq’s network of “Knoqers” will be able to interact with visitors to those properties and help “pair consumers with the right product,” whether that’s auto insurance or software. After all, she noted that plenty of consumers are connecting with Ad Practitioners via chat bots and phone calls: “These are people already asking for help … we’re really just connecting the dots.”

Image Credits: Knoq

In the acquisition announcement, Ad Practitioners CEO Greg Powel made a similar point, saying that the deal represents “a shared vision of helping people make decisions through conversations driven by data and technology while educating people about products and services that matter.”

“The Money and ConsumersAdvocate.org brands are already trusted by millions of highly engaged users,” Powel continued. “Together, we foresee a world where consumers come to our sites for great content [and] reviews and to speak with representatives who can help them find the personal information they need.”

Knoq leadership has already moved to join Ad Practitioners in Puerto Rico, with the rest of the Knoq team set to relocate later this year as well.

You might think a startup would be inclined to stay put in its current location (in Knoq’s case, Boston), at least for the duration of the pandemic, but Tucker said she’s a big believer in seeing your team in person. In fact, the Knoq team had socially distanced outdoor meetups over the summer, “to brainstorm or just hang out and make sure people are okay.” Plus, she’s excited about the possibility of “hiring the amazing people on this island.”

The financial terms of the acquisition were not disclosed. Knoq had most recently raised $2.5 million from Initialized Capital and Haystack.vc, and Tucker said it was crucial that the acquisition provided a good outcome not just for her team and herself, but also her investors.

“We’re so excited for Kendall and her team on their successful exit to Ad Practitioners,” said Initialized General Partner Alda Leu Dennis in a statement. “It’s been a pleasure partnering with Knoq over the last few years. The Knoq team will bring a tech-forward approach to sales outreach and customer analytics. And, Kendall’s skills as a brilliant builder, operator and strategic thinker will be a huge asset for Ad Practitioners.”

3 adtech and martech VCs see major opportunities in privacy and compliance

LA-based Metropolis raises $41 million to upgrade parking infrastructure

Published February 16, 2021

Metropolis is a new Los Angeles-based startup that’s looking to compete with BMW-owned ParkMobile for a slice of the automated parking lot management market.

Upgrading parking with a computer vision-based system that recognizes cars as they enter and leave garages has been Metropolis’ mission since founder and chief executive Alex Israel first formed the business back in 2017.

Israel, a serial entrepreneur, has spent decades thinking about parking. His last company, ParkMe, was sold to Inrix back in 2015. And it was with those earnings and experience that Israel went back to the drawing board to develop a new kind of parking payment and management service.

Inrix Buys ParkMe To Add Smart Parking Services To Its Real Time Traffic Data

Now, the company is ready for its closeup, announcing not only its launch, but $41 million in financing the company raised from investors, including the real estate managers Starwood and RXR Realty; Dick Costolo and Adam Bain’s 01 Advisors; Dragoneer; former Facebook employees Sam Lessin and Kevin Colleran’s Slow Ventures; Dan Doctoroff, the head of Alphabet’s Sidewalk Labs initiative; and NBA All Star and early-stage investor, Baron Davis. Global growth equity firm 3L led the round.

According to Alex Israel, the parking payment application is the foundation for a bigger business empire that hopes to reimagine parking spaces as hubs for a broad array of urban mobility services.

In this, the company’s goals aren’t dissimilar from the Florida-based startup, REEF, which has its own spin on what to do with the existing infrastructure and footprint created by urban parking spaces. And REEF’s $700 million round of funding from last year shows there’s a lot of money to be made — or at least spent — in a parking lot.

REEF Technology raises $700M from SoftBank and others to remake parking lots

Unlike REEF, Metropolis will remain focused on mobility, according to Israel. “How does parking change over the next 20 years as mobility shifts?” he asked. And he’s hoping that Metropolis will provide an answer.

The company is hoping to use its latest funding to expand its footprint to more than 600 locations over the course of the next year. In all, Metropolis has raised $60 million since it was formed back in 2017.

While the computer vision and machine learning technology will serve as the company’s beachhead into parking lots, services like cleaning, charging, storage and logistics could all be part and parcel of the Metropolis offering going forward, Israel said. “We become the integrator [and] we also in some cases become the direct service provider,” Israel said.

The company already has 10,000 parking spots that it’s managing for big real estate owners, and Israel expects more property managers to flood to its service.

“[Big property owners] are not thinking about the infrastructure requirements that allow for the seamless access to these facilities,” Israel said. His technology can allow buildings to capture more value through other services like dynamic pricing and yield optimization as well.

“Metropolis is finding the highest and best use whether that be scooter charging, scooter storage, fleet storage, fleet logistics or sorting,” Israel said.

Axiom Space raises $130 million for its commercial space station ambitions

Published February 16, 2021

One of the new space startups with the loftiest near-term goals has raised $130 million in a Series B round that demonstrates investor confidence in the scope of its ambitions: Axiom Space, which has been tapped by NASA to add privately developed space station modules to the ISS, announced the new funding led by C5 Capital.

This is the latest in a string of high-profile announcements for Axiom, which was founded in 2016 by a team including space professionals with a history of demonstrated expertise working on the International Space Station. Eventually, Axiom hopes to go from adding the first private commercial modules to the existing station, to creating their own, wholly private on-orbital platforms — for research, space tourism and more.

Axiom announced the people who will take part in its first-ever private astronaut launch to the ISS, which is set to fly next January using a SpaceX Dragon spacecraft and Falcon 9 rocket. Axiom is the service provider for the mission, brokering the deal for the private spacefarers and setting up training and mission profile. That should be the first time we see a crew made up entirely of private individuals (i.e. not astronauts selected, trained and employed by their respective national government) make its way to the station.

Tom Cruise reportedly talking to SpaceX about shooting a movie in space

The company was also in discussions with Tom Cruise about filming at least part of an upcoming film aboard the ISS, and it’s in development with a production company on a forthcoming competition reality show that will see contestants vie for a spot on a private flight to the station.

Axiom is emerging as the leading linkage between private human spaceflight and the existing infrastructure and industry, covering both public sector partners like NASA, and the “rails” of the bourgeoning industry — SpaceX and its ilk. It’s been focused on this unique opportunity longer than most in the private market, and it has all the relationships and in-house expertise to make it work.

Contestants will compete for a SpaceX trip to the International Space Station in new reality TV show

This new, significant injection of capital will help the company hire, as well as boost its ability to construct the pieces of its forthcoming private space station modules, as well as its eventual station itself. The Houston-based company aims to put its ISS modules on the station by 2024, and it has raised $150 million to date.

Citadel ID raises $3.5M for API-delivered income and employment verification

Published February 16, 2021

This morning Citadel ID announced a combined $3.5 million raise for its income and employment verification service. The startup provides an API to customer companies, allowing them to rapidly verify details of consumer employment.

The capital came from a blend of venture firms and angels. On the firm side, Abstract and Soma VC were in there, along with ChapterOne. Brianne Kimmel put capital in as well, according to the startup. And denizens with work histories at companies like Zynga (Mark Pincus), Stripe (Lachy Groom), Carta (Henry Ward) and others also put cash into the fundraise. (The company reached out to add that Fathom Capital also put a good amount in the round.)

Citadel was founded back in June of 2020, before raising capital, snagging its first customer and shipping its product all inside of the same year.

The idea for Citadel ID came when co-founder Kirill Klokov worked at Carta, the cap-table-as-a-service startup that recently built an exchange for the trading of private stock. Klokov discovered while working on the tech side of the company how hard it was to verify certain data, like employment and income and identity.

Carta’s startup liquidity service CartaX conducts first transactions on its own cap table

As Carta deals with money, stock and the collection and distribution of both, you can imagine why having a quick way to verify who worked where, and since when, mattered to the company. But Klokov came to realize that there wasn’t a good solution in the market for what Carta needed, sans building integrations to a host of payroll managers by hand and dealing with lots of data with varying taxonomies. That or using an in-the-market product, like Equifax’s The Work Number, which the founder described as expensive and offering relatively low coverage.

To fill the market void Klokov helped found Citadel ID, quickly building integrations into payroll managers where there were hooks for code, and working around older login systems when needed. Citadel ID’s service allows regular folks to provide access to their employment data to others, allowing for the verification of their income (a rental group, perhaps), or employment (Carta, perhaps) quickly.

Per the startup the market demand for such verifications is in the hundreds of millions every year in the United States. So, Citadel should have plenty of market space to grow into. Citadel ID has around 20 customers today, it told TechCrunch, and charges on a per verification basis.

Finally, while Citadel also offers data via its website and not merely through its API, the startup still fits inside the growing number of startups we’ve seen in recent quarters foregoing traditional SaaS, and instead offering their products via a developer hook (sometimes referred to as a “headless” approach). API-delivered startups are not new, after all Twilio went public years ago. But their model of product delivery feels like it’s gaining momentum over managed software offerings.

Let’s see how quickly Citadel ID can scale before it raises its Series A.

API startups are so hot right now

Valoreo closes on $50M to roll up LatAm e-commerce brands

Published February 16, 2021

A new breed of startups is acquiring and growing small but promising third-party merchants, and building out their own economies of scale.

And while there are a number of such startups based in the U.S. and Europe, none had emerged in the Latin American market. Until now.

Valoreo, a Mexico City-based acquirer of e-commerce businesses, announced Tuesday that it has raised $50 million of equity and debt financing in a seed funding round.

The dollar amount is large for a seed round by any standards, but most certainly ranks among the highest ever raised by a Latin American startup — further evidence of increased investor interest in the region’s burgeoning venture scene.

Upper90, FJ Labs, Angel Ventures, Presight Capital and a slew of angel investors participated in the round. Those angels included David Geisen, head of Mercado Libre Mexico; BEA Systems’ co-founder Alfred Chuang; and Tushar Ahluwalia, founder of Razor Group, a European marketplace aggregator, among others.

Founded in late 2020, Valoreo aims to invest in, operate and scale e-commerce brands as part of its self-described mission “to bring better products at more affordable prices” to the Latin American consumer.

“We were substantially oversubscribed and were therefore able to select investors that not only provide capital, but also additional know-how in key areas,” said co-founder Alex Gruell.

Valoreo joins the growing number of startups focused on rolling up e-commerce brands.

The company’s model is similar to that of Thrasio — which just raised another $750 million –– and Perch in the U.S. But Valoreo says its approach has been tailored to “the specific needs of the Latin American market and is specifically focused on the Latin American end customer.”

Another new company in the space called Branded recently launched its own roll-up business on $150 million in funding. Others in the space include Berlin Brands Group, SellerX, Heyday and Heroes.

But as my colleague Ingrid Lunden points out, “the feverish pace of fundraising in the area of FBA roll-ups feels very much like a bubble in the market — not least because none of these still-young companies have yet to prove that the strategy to buy up and consolidate these sellers is a useful and profitable one.”

Thrasio raises $750M more in equity for its Amazon roll-up play

How it works

Valoreo (which the company says is an extension of the Spanish word “valor,” meaning to add value), acquires merchants that operate their own brands and primarily sell on online marketplaces such as Mercado Libre, Amazon and Linio. The company targets brands that offer “category-leading products” and which it believes have “significant growth potential.” It also develops brands in-house to offer a broader selection of products to the end customer.

Like Thrasio, Valoreo says it’s able to help entrepreneurs who may lack the resources and access to capital to take their businesses to the next level.

Co-founder and co-CEO Stefan Florea says the company takes less than five weeks typically from its initial contact with a seller to a final payout.

Then, the acquired and developed brands are integrated into the company’s consolidated holding. By tapping its team of “specialists” in areas such as digital marketing and supply chain management, it claims to be able to help these brands “reach new heights” while giving the entrepreneurs behind the companies “an attractive exit,” or partial exit in some cases.

“We have different structures, always taking into account the personal objectives of the seller,” Stefan Florea added.

Latin America’s digital transformation is making up for lost time

Generally Valoreo acquires the majority of the business, with the purchase price typically being a combination of an upfront cash payment and a profit share component so sellers can still earn money.

Looking ahead, Valoreo plans to use its new capital mostly to acquire and develop “interesting” brands, as well as build out its current team of 10 while expanding its infrastructure and operations.

The company is currently focused on the Mexican and Brazilian markets, but is planning its expansion into other Latin American countries where it has strong local support systems, such as Colombia, according to co-founder Martin Florea.

“Our mission is to be a pan-Latin American player providing value to the entire region,” Martin Florea said. “Latin America in general and Mexico in particular are in a distinct situation which provides phenomenal opportunities for e-commerce merchants on the one hand but also presents particular challenges on the other hand.”

Those challenges, according to Martin Florea, include limited access to growth capital, a lack of specialized expertise in certain areas (such as supply chain management), limited opportunities to sell their business and pursue new ventures, as well as operational burdens and the lack of capacities to expand into new countries and marketplaces.

Valoreo emphasizes it is not out to compete with Mercado Libre, Amazon and other regional marketplaces but instead wants to partner with them.

“Without these platforms, this opportunity would not exist,” Martin Florea said.

Hernán Fernández, founder and managing partner of Angel Ventures, believes Valoreo “will add a lot of value” to the Latin American e-commerce landscape, which is experiencing both market growth and the fragmentation of the seller space.

Jüsto co-founder and CEO (and Valoreo investor) Ricardo Weder notes that the e-commerce market is at an inflection point in Latin America. According to eMarketer, the region was the fastest-growing e-commerce market in the world in 2020, with 37% year over year growth. However, it is a much more fragmented and crowded market compared to other regions, such as the United States.

Mexican online grocer Jüsto raises $65M in General Atlantic-led Series A

This, Valoreo believes, provides an opportunity for consolidation.

“There are still many consumers that are not aware of the great variety of outstanding local brands that sell innovative products on marketplaces online,” Stefan Florea said. “In the U.S. or Europe e-commerce is the new way of shopping, offering an even greater range of products and brands than offline shopping. We firmly believe it will not take long until end-customers in Mexico and across Latin America discover all the benefits that e-commerce offers.”

Bitcoin briefly breaks the $50,000 barrier as Coinbase’s direct listing looms

Published February 16, 2021

The hodl-crew are having quite the moment as bitcoin passed the $50,000 mark earlier today for the first time. Data pegs the peak at just over $50,500.

The price of bitcoin, the world’s best-known cryptocurrency, has historically proven a reasonable proxy for consumer interest in the cryptocurrency space, and for trading activity amongst blockchain-based assets. Bitcoin’s price has retreated since the milestone, and is now worth just over $49,000.

Bitcoin has been on a tear this year, rising from around the $30,000 mark at the start of 2021 to its recent $50,000 milestone, a gain of around 66%. Looking back a year and the gains are even more impressive, with the price of bitcoin rising from around $10,000 a year ago to its current price, a gain of 400%.

Jack Dorsey and Jay Z invest 500 BTC to make Bitcoin ‘internet’s currency’

Luckily for investors and believers in other decentralized tokens, it’s not just bitcoin that is enjoying a valuation updraft. Cardano, one of the most highly valued blockchain assets, is up around 27% in the last week, according to CoinMarketCap. Its total value is nearing the $27 billion mark.

Companies built atop the burgeoning cryptocurrency space could be enjoying a boom as the price of bitcoin advances; as trading activity and consumer interest tend to rise along with the price of bitcoin, and companies like Coinbase make money from trading activity and consumer use, 2021 is starting off strongly.

Coinbase has filed to go public, and intends to pursue a direct listing in short order.

What’s driving up the price of bitcoin and its sister-tokens in the short-term? In a market melt-up its hard to point fingers with any accuracy. But broadly speaking, if it feels that nearly every asset class is setting new all-time records, so why not bitcoin as well?

Coinbase files to go public confidentially and we’re hyped

Tencent backs digital rights startup Pex in $57M round

Published February 16, 2021

Pex, a startup aiming to give rightsholders more control over how their content is used and reused online, has raised $57 million in new funding.

The round comes from existing investors including Susa Ventures and Illuminate Ventures, as well as Tencent, Tencent Music Entertainment, the CueBall Group, NexGen Ventures Partners, Amaranthine and others.

Founded in 2014, Pex had previously raised $7 million, and it acquired music rights startup Dubset last year. Founder and CEO Rasty Turek told me that while the product has evolved from what he described as “a Google-like search engine for rightsholders to find copyright infringement” into a broader platform, the vision of creating a better system of managing copyright and payments online has remained the same.

The startup describes its Attribution Engine as the “licensing infrastructure for the Internet,” bringing together the individuals and companies who own content rights, creators who might want to license and remix that content, the big digital platforms where content gets shared and the law enforcement agencies that want to monitor all of this.

The product includes six modules — an asset registry, a system for identifying those assets when they’re used in new content, a licensing system, a dispute resolution system, a payment system and data and reporting to see how your content is being used.

Turek said that while Pex is being used by “most of the largest rightsholders in the world,” the system was built to be accessible to “a struggling musician out on the streets of Los Angeles” who doesn’t have the resources to “police all of this content” online.

Pex CEO Rasty Turek. Image Credits: Pex

He also suggested that the broader regulatory environment is calling for a solution like Pex, with the European Union passing a new copyright directive that’s set to take effect this year, and new copyright legislation also on the table in the United States. The EU bill was criticized for potentially prompting larger platforms to preemptively block broad swaths of content, but Turek argued, “There’s so much content out there in search of an audience that this is going to be the opposite of overblocking.”

Not that Pex is relying entirely on regulators. Turek also said the platform is structured to balance the needs of the different groups using it — and that it has an incentive to strike that balance because its revenue comes from licensing deals, so it’s focused on “really being the Switzerland, really being the neutral party.”

The new stimulus bill makes illegal streaming a felony

“We designed all of our business around the idea that if we try to abuse the system, we lose, too,” he said. “We don’t make money [when someone] abuses the system, we only make money when everybody plays nice.”

Turek also claimed that public domain and Creative Commons licenses are “first-class citizens” on the platform, and that many of the rightsholders using the Attribution Engine don’t necessarily want monetary compensation: “A lot of people are happy to do this for recognition. We are social animals.” (Plus, recognition can lead to moneymaking opportunities.)

Pex says the new funding will allow it to continue scaling the Attribution Engine.

“I don’t believe investments are validation,” Turek added. “I believe they’re more obligation than validation, but they do prove you are directionally correct.”

Pex buys Dubset to build YouTube ContentID for TikTok & more

Zencastr raises $4.6M as its beta video offering goes live for all

Published February 16, 2021

Founded in late-2014, Salt Lake City-based Zencastr has become a kind of lifeline for many podcasters, as the pandemic pushed formerly in-person podcasts online. The startup is hardly a household name, but the company says it’s used by around 6% of all podcasts, based on an estimated 800,000 to 1.2 million active shows in the world.

I can certainly say, anecdotally, that just about every podcaster I’ve spoken to has tried the service, which offers a more specialized solution than video chat programs like Zoom and Skype. Some have managed to retrofit the latter to their needs, but Zencastr’s solution offers, among other things, high-quality audio recordings saved both locally and in the cloud.

As of last June, the company has also been testing a video feature. That’s long been a missing piece of the puzzle. I know I’ve moved over to Zoom since taking my show online during the pandemic. As pretty much any person can tell you a little over a year into the pandemic, video chat is no replacement for in-person interactions, but it works in a pinch. At the very least, it creates an additional dimension of human interaction you don’t get with voice alone.

Up to now, the video offering was only available as a closed beta. Today the beta opens to all users, bringing with it HD video recording, coupled with the already high-quality sound. I’ve been toying around with the feature for my own podcast and find it to be less straightforward than services like Zoom, but more customizable. It leaves you with HD video files you can edit into a tighter show or simply go with the split screen. There’s also a live chat, footnotes and a soundboard, much of which seemed aimed at essentially editing the shows in real time.

Along with the broader arrival of the video feature, Zencastr is announcing a $4.6 million seed round — the service’s first major funding since launch.

Zencastr is testing a video podcasting tool in limited beta

Founder and CEO Josh Nielsen tells TechCrunch that Zencastr has thus far been, “bootstrapped, self-funded and really just kind of a grassroots company in the podcasting space. A lot of people are getting interested in podcasting right now and we feel like it’s important to have a company like ours continue to represent our creators. They’re our North Star.”

As interest in podcasting has grown, Zencastr’s use has expanded with it. The company says it has seen around a 147% growth in podcasting hours since the beginning of COVID-19. The seed round is led by Utah-based Kickstart, with participation from former Flipagram executives Brian Dilley and Farhad Mohit and former Skullcandy CEO Jeremy Andrus, among others.

“This company started off pretty small and didn’t have a lot of resources,” Nielsen adds. “But we’ve always been profitable, we’ve always been growing. We still are, but we’re raising money to accelerate that growth. This is also a rebrand and a step forward in the reliability and stability of the platform.”

Stability has been something of an issue in the past with many of the Zencastr users I’ve spoken to. Spending more time with this service ahead of this news, I certainly found some nits to pick, including an audio delay I haven’t experienced with non-devoted services like Skype and Zoom. It’s not the end of the world, but it’s the kind of thing that can really throw you off your rhythm during an interview. The video presentation is also lacking in sophistication, but that’s to be expected in a closed beta.

The funding will go to smoothing out some of those wrinkles, as well as hiring.

“Headcount is one of the primary reasons for raising this round,” co-founder and CPO Adrian Lopez tells TechCrunch. “We were a fully distributed team before COVID existed. We have people in 11 different countries around the world. That was a very conscious choice. We believe that distribution allows us to work with some of the best people, regardless of where they are.”

Today also sees the launch of “Digital Nomad,” a podcast series produced by Zencastr that explores its own origin story. Though, the company is quick to add that this isn’t the beginning of a major push into producing original content.

“We believe strongly in podcasting as a medium that connects people,” says Lopez. “We formed the company around that. We’re fully distributed so we can put our money where our mouth is and put people all over and connect via this medium. We want to start telling that story.”

Zencastr has seen a fair bit of increased competition in the category, including the likes of SquadCast and Riverside.fm. The company’s solid growth over the past year could also see some regression as more people feel comfortable recording shows in person, as the vaccines have been sufficiently distributed.

“We’re going to see some retraction, I think, as things and people go back to work,” says Lopez. “But I think it will all come out in the wash, because there’s just a much bigger-growing interest in podcasting over all. It happened before COVID and it will continue after COVID.”

Zencastr waives hobbyist limits, since we’re all stuck at home podcasting now