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Arya raises $21M to provide farmers in India finance and post-harvest services
Only about a third of the yields Indian farmers produce reaches the big markets. Those whose produce makes it there today are able to leverage post-harvest services. Everyone else is missing out.
A Noida-based startup is working with all the stakeholders — farmers, food processors, traders and financial institutions — to bridge this post-harvest services gap — and it just secured new funds to continue its journey.
Seven-year-old Arya said on Tuesday it has raised $21 million in its Series B financing round. The round was led by Quona Capital, a venture firm that focuses on fintech in emerging markets. Existing investors LGT Lightstone Aspada and Omnivore also participated in the round, while multiple unnamed lenders are providing additional debt financing to the startup, Arya said.
Nearly all post-harvest interventions that exist in India today are focused largely toward major agriculture centres such as Kota in the northern Indian state of Rajasthan and Azadpur Mandi in capital New Delhi, explained Prasanna Rao, co-founder and chief executive of Arya, in an interview with TechCrunch.
This uneven concentration has deprived millions of farmers in the country of reasonable options to efficiently store and sell their produce and of financing options to maintain their cash flow, he said.
“Our belief is that we should cater to the two-thirds of the market that are currently underserved. The Kota mandi (market), for instance, has 35 bank branches in a kilometre of radius. But if you travel 70 to 80 kilometres away from Kota, this really declines,” said Rao, who previously worked at a bank.
Arya is solving all the aforementioned challenges: It operates a network of more than 1,500 warehouses in 20 Indian states where it stores over $1 billion worth of commodities. This network allows farmers to store their produce at a centre that is much nearer to their farms, avoiding any spillage and exorbitant real estate costs of the big markets. On the credit side, Arya has disbursed over $36.5 million to farmers and its banking partners have disbursed more than $95 million.
“Arya is addressing a vastly underserved market of farmers in India, half of whom previously had little access to post-harvest finance,” said Ganesh Rengaswamy, co-founder and partner at Quona Capital, in a statement. “We believe Arya’s unique approach, providing a full-service digital platform with embedded finance and differentiated efficiencies for small farmholders, will drive the future of farming in India.”
The startup’s offerings have proven even more useful during the coronavirus pandemic, which saw New Delhi enforce one of the world’s strictest lockdowns earlier this year. The lockdown broke the supply chain network, and prices of agricultural commodities dropped by over 20%.
To navigate this, Arya connected farmer produce organizers, or FPOs, with buyers through its own digital marketplace a2zgodaam.com. “The need for immediate liquidity saw demand increase for credit against these warehouse receipts. Arya’s credit portfolio saw a 3x jump year-on-year,” wrote Prashanth Prakash, a founding partner at Accel in India, and Mark Kahn, managing partner at Omnivore in an industry report last week.
Rao said Arya will deploy the fresh capital to scale its fintech platform in a “big way” as the startup broadens its network of warehouses across the country. Additionally, the startup plans to fuel the growth of a2zgodaam.com, which also aggregates unorganized warehouses, and supercharge them with their own set of financiers and insurers and ways to allow farmers to sell directly through these warehouses if they need.
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Sequoia picks its horse in the consumer carbon offset market, leading a $2.5 million round for Joro
Sanchali Pal first woke up to the world’s climate crisis after watching the 2008 documentary Food Inc.
The Princeton undergraduate saw the film in 2011, and it started her on the journey that would lead her to launch Joro, the Sequoia-backed startup that monitors consumer spending to offer tips on how to offset and reduce a user’s carbon footprint.
After scoring a job at the development firm Dalberg, then working in India and Ethiopia, Pal returned to the U.S. to pursue an MBA at Harvard Business School. She initially thought she’d focus on transportation, but her mind kept returning to consumer consumption habits and the potential to reduce CO2 emissions by targeting consumer behavior.
“I started thinking about it in the fall of my first year at business school, and I kind of put it on the back burner because I didn’t know how to do it from a practical stand. I wasn’t a technology person. I didn’t build software myself,” Pal told Jason Jacobs, the host of the My Climate Journey podcast. “I didn’t know how we would capture the data to show someone their carbon footprint and help them reduce it until I met my co-founder [J. Cressica Brazier], and I met her at an MIT event in the spring of that year two years ago, and the wheels started turning, maybe there’s a tool here that we could build together.”
The Joro app uses consumer spending data culled from integrations with Plaid to identify changes in users’ personal habits that can make an impact on their overall carbon footprint — based on their personal spending.
The app also has a community component, connecting users with sustainability challenges, classes and other educational tools, along with a social network to communicate with peers to track relative progress.
Consider it a version of keeping up with the Joneses, but for planetary health and eco-consciousness.
To date, the app’s community of users have reduced nearly 6 million kilograms of carbon dioxide emissions in 2020. Which sounds impressive, but given reductions in travel due to COVID-19 mitigation restrictions, the largest contribution that a consumer can make is reducing their meat consumption. While that only leads to roughly 4% reductions in global carbon emissions, it reduces about 1,200 pounds of carbon emissions. Over the 6 million kilograms that would mean a little bit over 10,000 people may be using the app.
Pal would not comment on the number of users her company’s app has managed to attract.
Image Credit: Joro
What the company does have now is $2.5 million in seed funding from investors including Sequoia Capital, which doubled down on its $1 million pre-seed commitment made when Joro was part of the firm’s early-stage founder program.
Other investors and advisors include the venture firms Expa and Amasia, and angel investors and advisors like James Park, the co-founder of Fitbit; Rich Pierson, the co-founder of Headspace; Sebastian Knutsson, the chief creative head and co-founder of King; the actress Maisie Williams; Philian, the private investment company of Karl-Johan Persson, chairman of H&M; Tom Baruch; and Anjula Acharia, a partner at Trinity Ventures.
“At Expa we are focused on backing remarkable founders that are passionate about the product they are building,” said Expa founder Garrett Camp in a statement. “We saw that in Sanchali – she had a big vision and conveyed it very strongly to us. We have conviction that Joro can build a great product and a great business. The world will be a better place because of what Joro will bring to market.”
Pal estimates that behavioral changes and better consumer choices can reduce an individual’s carbon footprint by up to 30%.
It’s a bet that other companies are making too. For instance, the Los Angeles challenger bank Aspiration, founded by Andrei Cherny, has a tool that can measure the “social impact” of a consumer’s monthly spending — that includes the climate impact of daily consumption.
Pal hopes that through the education and community components of the app, consumers can put pressure on the systems and industries that are the primary producers of greenhouse gas emissions to change their ways.
“Systems are made of people. Like us,” Pal wrote in a blog post. “Companies and governments change when enough people demand it through their actions and behaviors. No, we’re not a silver bullet — we need policymakers and businesses to take sweeping action. But we’re not powerless either. Together we can accelerate the pace of change by demonstrating our demand for a cleaner society.”
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German Bionic raises $20M led by Samsung for exoskeleton tech to supercharge human labor
Exoskeleton technology has been one of the more interesting developments in the world of robotics: Instead of building machines that replace humans altogether, build hardware that humans can wear to supercharge their abilities. Today, German Bionic, one of the startups designing exoskeletons specifically aimed at industrial and physical applications — it describes its Cray X robot as “the world’s first connected exoskeleton for industrial use,” that is, to help people lifting and working with heavy objects, providing more power, precision and safety — is announcing a funding round that underscores the opportunity ahead.
The Augsburg, Germany-based company has raised $20 million, funding that it plans to use to continue building out its business, as well as its technology, both in terms of the hardware and the cloud-based software platform, German Bionic IO, that works with the exoskeletons to optimize them and help them “learn” to work better.
The Cray X currently can compensate up to 30 kg for each lifting movement, the company says.
“With our groundbreaking robotic technology that combines human work with the industrial Internet of Things (IIoT), we literally strengthen the shop floor workers’ backs in an immediate and sustainable way. Measurable data underscores that this ultimately increases productivity and the efficiency of the work done,” says Armin G. Schmidt, CEO of German Bionic, in a statement. “The market for smart human-machine systems is huge and we are now perfectly positioned to take a major share and substantially improve numerous working lives.”
The Series A is being co-led by Samsung Catalyst Fund, a strategic investment arm from the hardware giant, and German investor MIG AG, one of the original backers of BioNtech, the breakthrough company that’s developed the first COVID-19 vaccine to be rolled out globally.
Storm Ventures, Benhamou Global Ventures (founded and led by Eric Benhamou, who was the founding CEO of Palm and before that the CEO of 3com) and IT Farm also participated. Previously, German Bionic had only raised $3.5 million in seed funding (with IT Farm, Atlantic Labs and individual investors participating).
German Bionic’s rise comes at an interesting moment in terms of how automation and cloud technology are sweeping the world of work. When people talk about the next generation of industrial work, the focus is usually on more automation and the rise of robots to replace humans in different stages of production.
But at the same time, some robotics technologists have worked on another idea. Because we’re probably still a long way away from being able to make robots that are just like humans, but better in terms of cognition and all movements, instead, create hardware that doesn’t replace, but augments, live laborers, to help make them stronger while still being able to retain the reliable and fine-tuned expertise of those humans.
The argument for more automation in industrial settings has taken on a more pointed urgency in recent times, with the rise of the COVID-19 health pandemic: Factories have been one of the focus points for outbreaks, and the tendency has been to reduce physical contact and proximity to reduce the spread of the virus.
Exoskeletons don’t really address that aspect of COVID-19 — even if you might require less of them as a result of using exoskeletons, you still require humans to wear them, after all — but the general focus that automation has had has brought more attention to the opportunity of using them.
And in any case, even putting the pandemic to one side, we are still a long way away from cost-effective robots that completely replace humans in all situations. So, as we roll out vaccinations and develop a better understanding of how the virus operates, this still means a strong market for the exoskeleton concept, which analysts (quoted by German Bionic) predict could be worth as much as $20 billion by 2030.
In that context, it’s interesting to consider Samsung as an investor: The company itself, as one of the world’s leading consumer electronics and industrial electronics providers, is a manufacturing powerhouse in its own right. But it also makes equipment for others to use in their industrial work, both as a direct brand and through subsidiaries like Harman. It’s not clear which of these use cases interests Samsung: whether to use the Cray X in its own manufacturing and logistics work, or whether to become a strategic partner in manufacturing these for others. It could easily be both.
“We are pleased to support German Bionic in its continued development of world-leading exoskeleton technology,” says Young Sohn, corporate president and chief strategy officer for Samsung Electronics and chairman of the board, Harman, in a statement. “Exoskeleton technologies have great promise in enhancing human’s health, wellbeing and productivity. We believe that it can be a transformative technology with mass market potential.”
German Bionic describes its Cray X as a “self-learning power suit” aimed primarily at reinforcing lifting movements and to safeguard the wearer from making bad calls that could cause injuries. That could apply both to those in factories, or those in warehouses, or even sole trader mechanics working in your local garage. The company is not disclosing a list of customers, except to note that it includes, in the words of a spokesperson, “a big logistics player, industrial producers and infrastructure hubs.” One of these, the Stuttgart Airport, is highlighted on its site.
“Previously, efficiency gains and health promotion in manual labor were often at odds with one another. German Bionic Systems managed to not only break through this paradigm, but also to make manual labor a part of the digital transformation and elegantly integrate it into the smart factory,” says Michael Motschmann, managing partner with MIG in a statement. “We see immense potential with the company and are particularly happy to be working together with a first-class team of experienced entrepreneurs and engineers.”
Exoskeletons as a concept have been around for over a decade already — MIT developed its first exoskeleton, aimed to help soldiers carrying heavy loads — back in 2007, but advancements in cloud computing, smaller processors for the hardware itself and artificial intelligence have really opened up the idea of where and how these might augment humans. In addition to industry, some of the other applications have included helping people with knee injuries (or looking to avoid knee injuries!) ski better, and for medical purposes, although the recent pandemic has put a strain on some of these use cases, leading to indefinite pauses in production.
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In&motion raises $12 million for its wearable airbag systems
French startup In&motion has raised a $12 million (€10 million) funding round led by Upfront Ventures, with 360 Capital also participating. The company has been working on wearable airbag systems for motorbikes.
Integrated in a vest, the airbag is completely autonomous and can detect crashes in 60 milliseconds. The company has worked on a device called the In&box that analyzes movements in real time. Thanks to different sensors, the device can determine when it’s time to activate the airbag.
In&motion has worked on different profiles for different types of activities. For instance, if you’re riding a motorcycle on a MotoGP track, chances are you’re going to move faster and change your trajectory quite often. You can choose between traditional motorcycle riding, track and off-road.
Professional racers are increasingly using airbag systems. In addition to MotoGP racers, participants in the 2021 Dakar Rallye will have to use airbags.
The go-to-market strategy is interesting as the startup isn’t selling its system directly to end users. In&motion has partnered with existing motorcycle brands so they can integrate the system in some vests. This way, In&motion doesn’t have to build out a network of resellers from scratch. So far, the company has sold tens of thousands of systems.
There’s also a subscription component, with unlimited warranty and the ability to replace the In&box device with a new model after three years.
With today’s funding round, the company wants to expand beyond its home country with a focus on Germany and the U.S. The company plans to double the size of its team.
Image Credits: In&motion
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Sweden’s Tink raises $103M as its open banking platform grows to 3,400 banks and 250M customers
Open banking platforms, where services that might not have previously lived next to each other are now joined up by way of APIs, has been one of the emerging trends of the last couple of years, and today one of the leaders in the space out of Europe has closed a round of funding to expand its business.
Tink, a startup out of Stockholm, Sweden that aggregates a number of banks and financial services by way of an API so that those can in turn be accessed via new channels, has raised €85 million (or $103 million at current rates), at a post-money valuation of €680 million (or around $825 million). It plans to use the capital to double down on expanding its network of banks and payment services in Europe. Tink already links up 3,400 banks, covering some 250 million people, with partners including PayPal, NatWest, ABN AMRO, BNP Paribas, Nordea and SEB, some of which are also strategic investors. On the other side, it has some 8,000 developers using its APIs.
This latest tranche of funding is being co-led by new investor Eurazeo Growth and Dawn Capital, with PayPal Ventures, HMI Capital, Heartcore, ABN AMRO Ventures, Poste Italiane and BNP Paribas’ venture arm, Opera Tech Ventures, also participating.
The funding comes less than a year after it announced a round of €90 million ($105 million) in January 2020, and is more specifically an extension of that round. For context, that previous round was at a €415 million ($503 million) valuation, and the company has definitely grown since then: in January it said it had 2,500 banking partners in its network. It has now raised €175 million in total.
The last year — shaped by a global health pandemic — has been all about bringing more services online and into the cloud, so people and businesses that can no longer do things like banking or selling/shopping in person can still get things done. That has most definitely played out strongly in the world of financial services, with banks, bank competitors and their tech partners seeing a surge in demand for more flexible, digital channels.
“Despite the difficulties of 2020, it was a year of great growth for Tink,” said Daniel Kjellén, co-founder and CEO of Tink, in a statement. “2020 has seen payments powered by open banking take-off, and in 2021 we expect to see this scale – most prominently in the UK, followed by Europe. This funding extension will further facilitate the development of our payment initiation services across Europe, while continuing to deliver new data-products built on open banking technology to our customers.”
Tink is not the only company that is looking to capitalize on this. Just earlier this week, another startup, Unit, came out of stealth with $18.6 million in funding. It also has ambitions to provide a way to integrate banking features, and banks, into environments where they might have not previously existed. Others also linking up financial services and helping them integrate into other platforms and apps include Plaid and Rapyd.
Plaid is in the process of getting acquired by Visa for $5.3 billion, although that deal is currently under antitrust scrutiny. Rapyd remains VC-backed and was last valued at $1.3 billion. The proliferation and growth of these might prove to be a strong argument in favor of the market not being sewn up by Plaid (no pun intended), although having one owned by a single payments giant would definitely shift how the market is evolving.
“The open banking movement continues to pick up pace, with 2021 showing every sign that it will bring increased collaboration between fintechs and large enterprises, who want to take digitally enabled services to their customers with a tried and trusted partner,” said Zoé Fabian, MD of Eurazeo Growth, in a statement. “Since its inception eight years ago, Tink has proven itself to be the leading open banking platform in Europe, and our investment underlines the confidence we and the industry have in Tink and open banking. We look forward to supporting them on their continued journey.”
Tink’s business is based around payment initiation technology, providing easy integrations into existing banking services, and then making a commission on transactions that subsequently take place. The company said that it currently processes around 1 million payment transactions per month in five markets.
Although it doesn’t specify the value of those transactions, or how much it makes itself, it notes that current customers include Kivra, a digital mailbox provider with 4 million adults in Sweden; and, as of earlier this year, payment fintech Lydia, with over 5 million customers. It is live in Sweden, U.K., France, Spain, Germany, Italy, Portugal, Denmark, Finland, Norway, Belgium, Austria and the Netherlands and the plan is to expand to 10 markets in 2021.
While the company will be using the funding to expand partnerships and its footprint, it’s also not shying away from inorganic growth. This year it made no less than three acquisitions to expand its business — a sign also of how there is likely more consolidation to come as not every company can find the scale and funding to grow in the current market. Tink’s acquisitions included Swedish credit decisioning firm Instantor, to expand in credit risk products; Spanish account aggregation provider Eurobits; and U.K. aggregation platform OpenWrks.
“Tink has truly emerged as Europe’s leading open banking platform and is quickly becoming a key strategic piece of financial technology infrastructure,” said Josh Bell, general partner of Dawn, in a statement. “We have seen activity across Tink’s network rapidly accelerate this year, with increasing adoption and implementation of open banking products and services across their platform. We are delighted to support Tink’s latest funding round, and look forward to working with the team across 2021 to expand the breadth and depth of its already considerable network of banks, accelerate the rollout of its account-to-account payments initiation solutions, and continue to deliver exceptional value to its fast-growing customer base.”
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Cosmos Video — a ‘Club Penguin for adults’ to socialise and work — raises $2.6M from LocalGlobe
All over the world startups are piling into the space marked “virtual interaction and collaboration”. What if a startup created a sort of “Club Penguin for adults”?
Step forward Cosmos Video, which has a virtual venues platform that allows people to work, hang out and socialize together. It has now raised $2.6 million in seed funding from LocalGlobe, with participation from Entrepreneur First, Andy Chung and Philipp Moehring (AngelList), and Omid Ashtari (former president of Citymapper).
Founders Rahul Goyal and Karan Baweja previously led product teams at Citymapper and TransferWise, respectively.
Cosmos allows users to create virtual venues by combining game mechanics with video chat. The idea is to bring back the kinds of serendipitous interactions we used to have in the real world. You choose an avatar, then meet up with their colleagues or friends inside a browser-based game. As you move your avatars closer to another person you can video chat with them, as you might in real life.
The competition is the incumbent video conferencing platforms such as Zoom and Microsoft Teams, but calls on these platforms have a set agenda, and are timeboxed — they’re rigid and repetitive. On Cosmos you sit on the screen and consume one video call after another as you move around the space, so it is mimicking serendipity, after a fashion.
As well as having a social application, office colleagues can work collaboratively on tools such as whiteboards, Google documents and Figma, play virtual board games or gather around a table to chat.
Cosmos is currently being used in private beta by a select group of companies to host their offices and for social events such as Christmas parties. Others are using it to host events, meetup groups and family gatherings.
Co-founder Rahul Goyal said in a statement: “Once the pandemic hit, we both saw productivity surge in our respective teams but at the same time, people were missing the in-office culture. Video conferencing platforms provide a great service when it comes to meetings, but they lack spontaneity. Cosmos is a way to bring back that human connection we lack when we spend all day online, by providing a virtual world where you can play a game of trivia or pong after work with colleagues or gather round a table to celebrate a friend’s birthday.”
George Henry, partner at LocalGlobe, said: “We were really impressed with the vision and potential of Cosmos. Scaling live experiences online is one of the big internet frontiers where there are still so many opportunities. Now that the video infrastructure is in place, we believe products like Cosmos will enable new forms of live online experiences.”
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Providing healthcare to lower-income communities values Cityblock Health at $1 billion
Cityblock Health, a company that provides healthcare services to low-income communities, is now commanding a high-priced valuation of over $1 billion after venture capitalists poured $160 million into the company.
The round was led by new investor General Catalyst with participation from crossover investor Wellington Management and support from major existing investors, including Kinnevik AB, Maverick Ventures, Thrive Capital, Redpoint Ventures and more, according to a statement from the company.
Cityblock works with community caregivers to work with residents to provide primary care, behavioral health and other services to address social determinants of health, in person and… increasingly… through virtual consultations.
The company first spun out of Alphabet’s Sidewalk Labs in 2017 and initially partnered with EmblemHealth. By relying primarily on licensed clinical social workers, community health partners and a network of specialized practice clinicians and doctors to provide basic primary care and supporting health services, Cityblock believes it can drive down the costs of healthcare.
Some 70,000 patients use Cityblock services in four major U.S. cities, the company said.
To date, Cityblock has raised $300 million.
The company said in a statement that the new funding will be used to support Cityblock’s national expansion in caring for Medicaid and dually-eligible communities, to attract and onboard talent across its product, engineering, data science, clinical and business operations, to launch new service lines and to continue investing in its proprietary technology platform, Commons.
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Turing nabs $32M more for an AI-based platform to source and manage engineers remotely
As remote work continues to solidify its place as a critical aspect of how businesses exist these days, a startup that has built a platform to help companies source and bring on one specific category of remote employees — engineers — is taking on some more funding to meet demand.
Turing — which has built an AI-based platform to help evaluate prospective, but far-flung, engineers, bring them together into remote teams, then manage them for the company — has picked up $32 million in a Series B round of funding led by WestBridge Capital. Its plan is as ambitious as the world it is addressing is wide: an AI platform to help define the future of how companies source IT talent to grow.
“They have a ton of experience in investing in global IT services, companies like Cognizant and GlobalLogic,” said co-founder and CEO Jonathan Siddharth of its lead investor in an interview the other day. “We see Turing as the next iteration of that model. Once software ate the IT services industry, what would Accenture look like?”
It currently has a database of some 180,000 engineers covering around 100 or so engineering skills, including React, Node, Python, Agular, Swift, Android, Java, Rails, Golang, PHP, Vue, DevOps, machine learning, data engineering and more.
In addition to WestBridge, other investors in this round included Foundation Capital, Altair Capital, Mindset Ventures, Frontier Ventures and Gaingels. There is also a very long list of high-profile angels participating, underscoring the network that the founders themselves have amassed. It includes unnamed executives from Google, Facebook, Amazon, Twitter, Microsoft, Snap and other companies, as well as Adam D’Angelo (Facebook’s first CTO and CEO at Quora), Gokul Rajaram, Cyan Banister and Scott Banister, and Beerud Sheth (the founder of Upwork), among many others (I’ll run the full list below).
Turing is not disclosing its valuation. But as a measure of its momentum, it was only in August that the company raised a seed round of $14 million, led by Foundation. Siddharth said that the growth has been strong enough in the interim that the valuations it was getting and the level of interest compelled the company to skip a Series A altogether and go straight for its Series B.
The company now has signed up to its platform 180,000 developers from across 10,000 cities (compared to 150,000 developers back in August). Some 50,000 of them have gone through automated vetting on the Turing platform, and the task will now be to bring on more companies to tap into that trove of talent.
Or, “We are demand-constrained,” which is how Siddharth describes it. At the same time, it’s been growing revenues and growing its customer base, jumping from revenues of $9.5 million in October to $12 million in November, increasing 17x since first becoming generally available 14 months ago. Current customers include VillageMD, Plume, Lambda School, Ohi Tech, Proxy and Carta Healthcare.
Remote work = immediate opportunity
A lot of people talk about remote work today in the context of people no longer able to go into their offices as part of the effort to curtail the spread of COVID-19. But in reality, another form of it has been in existence for decades.
Offshoring and outsourcing by way of help from third parties — such as Accenture and other systems integrators — are two ways that companies have been scaling and operating, paying sums to those third parties to run certain functions or build out specific areas instead of shouldering the operating costs of employing, upsizing and sometimes downsizing that labor force itself.
Turing is essentially tapping into both concepts. On one hand, it has built a new way to source and run teams of people, specifically engineers, on behalf of others. On the other, it’s using the opportunity that has presented itself in the last year to open up the minds of engineering managers and others to consider the idea of bringing on people they might have previously insisted work in their offices, to now work for them remotely, and still be effective.
Siddarth and co-founder Vijay Krishnan (who is the CTO) know the other side of the coin all too well. They are both from India, and both relocated to the Valley first for school (post-graduate degrees at Stanford) and then work at a time when moving to the Valley was effectively the only option for ambitious people like them to get employed by large, global tech companies, or build startups — effectively what could become large, global tech companies.
“Talent is universal, but opportunities are not,” Siddarth said to me earlier this year when describing the state of the situation.
A previous startup co-founded by the pair — content discovery app Rover — highlighted to them a gap in the market. They built the startup around a remote and distributed team of engineers, which helped them keep costs down while still recruiting top talent. Meanwhile, rivals were building teams in the Valley. “All our competitors in Palo Alto and the wider area were burning through tons of cash, and it’s only worse now. Salaries have skyrocketed,” he said.
After Rover was acquired by Revcontent, a recommendation platform that competes against the likes of Taboola and Outbrain, they decided to turn their attention to seeing if they could build a startup based on how they had, basically, built their own previous startup.
There are a number of companies that have been tapping into the different aspects of the remote work opportunity, as it pertains to sourcing talent and how to manage it.
They include the likes of Remote (raised $35 million in November), Deel ($30 million raised in September), Papaya Global ($40 million also in September), Lattice ($45 million in July) and Factorial ($16 million in April), among others.
What’s interesting about Turing is how it’s trying to address and provide services for the different stages you go through when finding new talent. It starts with an AI platform to source and vet candidates. That then moves into matching people with opportunities, and onboarding those engineers. Then, Turing helps manage their work and productivity in a secure fashion, and also provides guidance on the best way to manage that worker in the most compliant way, be it as a contractor or potentially as a full-time remote employee.
The company is not freemium, as such, but gives people two weeks to trial people before committing to a project. So unlike an Accenture, Turing itself tries to build in some elasticity into its own product, not unlike the kind of elasticity that it promises its customers.
It all sounds like a great idea now, but interestingly, it was only after remote work really became the norm around March/April of this year that the idea really started to pick up traction.
“It’s amazing what COVID has done. It’s led to a huge boom for Turing,” said Sumir Chadha, managing director for WestBridge Capital, in an interview. For those who are building out tech teams, he added, there is now “No need for to find engineers and match them with customers. All of that is done in the cloud.”
“Turing has a very interesting business model, which today is especially relevant,” said Igor Ryabenkiy, managing partner at Altair Capital, in a statement. “Access to the best talent worldwide and keeping it well-managed and cost-effective make the offering attractive for many corporations. The energy of the founding team provides fast growth for the company, which will be even more accelerated after the B-round.”
PS. I said I’d list the full, longer list of investors in this round. In these COVID times, this is likely the biggest kind of party you’ll see for a while. In addition to those listed above, it included [deep breath] Founders Fund, Chapter One Ventures (Jeff Morris Jr.), Plug and Play Tech Ventures (Saeed Amidi), UpHonest Capital (Wei Guo, Ellen Ma), Ideas & Capital (Xavier Ponce de León), 500 Startups Vietnam (Binh Tran and Eddie Thai), Canvas Ventures (Gary Little), B Capital (Karen Appleton Page, Kabir Narang), Peak State Ventures (Bryan Ciambella, Seva Zakharov), Stanford StartX Fund, Amino Capital, Spike Ventures, Visary Capital (Faizan Khan), Brainstorm Ventures (Ariel Jaduszliwer), Dmitry Chernyak, Lorenzo Thione, Shariq Rizvi, Siqi Chen, Yi Ding, Sunil Rajaraman, Parakram Khandpur, Kintan Brahmbhatt, Cameron Drummond, Kevin Moore, Sundeep Ahuja, Auren Hoffman, Greg Back, Sean Foote, Kelly Graziadei, Bobby Balachandran, Ajith Samuel, Aakash Dhuna, Adam Canady, Steffen Nauman, Sybille Nauman, Eric Cohen, Vlad V, Marat Kichikov, Piyush Prahladka, Manas Joglekar, Vladimir Khristenko, Tim and Melinda Thompson, Alexandr Katalov, Joseph and Lea Anne Ng, Jed Ng, Eric Bunting, Rafael Carmona, Jorge Carmona, Viacheslav Turpanov, James Borow, Ray Carroll, Suzanne Fletcher, Denis Beloglazov, Tigran Nazaretian, Andrew Kamotskiy, Ilya Poz, Natalia Shkirtil, Ludmila Khrapchenko, Ustavshchikov Sergey, Maxim Matcin and Peggy Ferrell.
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Fairmarkit lands $30M Series B to modernize procurement
As the pandemic has raged on, it has shone a spotlight on the importance of procurement, especially in certain sectors. Fairmarkit, a Boston startup, is working to bring a modern digital procurement system to the enterprise. Today, the company announced a $30 million Series B.
GGV Capital and Insight Partners led the round with help from existing investors 1984 VC, NewStack and NewFund. Today’s investment brings the total raised to $42 million, according to the company.
Fairmarkit wants to replace large procurement software systems from companies like Oracle and SAP that have been around for decades, says company co-founder and CEO Kevin Frechette. When he looked around a couple of years ago, he saw a space full of these legacy vendors and ripe for disruption.
What’s more, he says that these systems have been designed to track only the biggest purchases over $500,000 or $1 million. Anything under that is what’s known as tail spend. “So procurement really focuses on companies’ biggest purchases, say things over a million, but anything under that size just gets forgotten about and neglected. It’s called tail spend, and it’s still 80% of what they buy, 80% of their vendors and 20% of the budget,” he told me.
This spending accounts for billions of dollars, yet Frechette says, it has lacked a good tracking system. He saw an opportunity, and he and his co-founders built a solution. Its first customer was the MBTA, Boston’s mass transit system (a system that could use all the help it can get in terms of getting more efficient). Today the company has more than 50 customers across a variety of industries.
The system acts as a marketplace for vendors and a central buying system for customers where they can find goods and services at this price point below $1 million. It imports a customer’s vendor data, and then combines this with other data to build a huge database of buying information. From that, they can determine what a customer needs and using AI, find the best prices for a particular order.
Frechette says this not only provides a way to save money — he says customers have been able to cut purchase costs by 10% with his system — it also provides a way to surface diverse vendors, whether that’s businesses owned by women, people of color, veterans, local business or however you define that.
He says too often what happens is that these deals aren’t put under typical procurement department scrutiny and they just get passed through, but Fairmarkit helps surface these companies and give them a shot at the business. “So because the core of our technology is a vendor recommendation engine […], we can help to invite those diverse vendors and really just give them a fair shot,” he said.
The company started the year with 40 employees and have added 30 since. The plan is to double that number next year, and as they do, Frechette hopes to reflect the diversity of the company’s product by building a correspondingly diverse employee base.
“It’s really just keeping it at the forefront. We want to make sure that we’re not just doing surveys around how we are doing for diversity and inclusion, but we’re putting programs in place to help out with it. It’s something I’m very very passionate about because it’s been such a sticking point as well on how we’re helping diverse vendors,” he said.
Frechette says that he has managed to grow the company and build a culture in spite of the pandemic not allowing employees to come into an office. He doesn’t see a world where the office will be a requirement in the future.
“We’ve hit an inflection point this year where there’s no world where we need everyone to be in an office […], which once again only helps to accelerate our business because we’re not constricted by everyone in this one small [geographical] sector. We can operate across the board [from anywhere],” he said.
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UserLeap raises $16 million to bring better qualitative data to PMs
Product managers can only be successful if they can make effective use of both quantitative and qualitative data. But mapping the former to the latter, and collecting high-quality data, is a huge challenge to organizations looking to rapidly productize and innovate.
UserLeap, a company founded by serial product manager Ryan Glasgow, thinks it has found a better way, and so do its investors. The company today announced the close of a $16 million Series A financing led by Accel (Dan Levine led the round), with participation from angels like Elad Gil, Dylan Field, Ben Porterfield, Akshay Kothari, Jack Altman and Bobby Lo.
One of the main challenges of rapid product development is that the ratio of quantitative data to qualitative data isn’t equal. It can take weeks or even months to get results from user surveys, and that’s only if users actually respond. According to UserLeap, the average response rate for email surveys is between 3% and 5%. To add to the headache, PMs and data teams usually have to parse that information and organize it manually.
UserLeap offers product teams the ability to put a short line of code into their product that then delivers contextual micro-surveys to users right within the product. The company says that these micro-surveys usually see a 20% to 30% response rate, and sometimes that even pops all the way to 90%.
Plus, the UserLeap dashboard processes the natural language from respondents and organizes the data. For example, if one user references price and another references cost, those responses are grouped together.
Because the surveys are built right into the product and targeted to a specific action or flow, and because the data is parsed and automatically sorted, product teams usually have access to this data within a few hours.
UserLeap charges based on the number of end users tracked, plus the number of surveys sent out per month, offering tiers for those surveys in groupings of five. Glasgow says this is a bit of a differentiator when compared to other survey products like SurveyMonkey or TypeForm.
“We have a usage-based pricing model, where our competitors often have a seat-based pricing model,” said Glasgow. “We don’t care how many people have access to us. Really, our goal is to get you to use our product.”
In other words, the insights gleaned from UserLeap can be shared and used across the entire organization without affecting the price.
This latest funding brings UserLeap’s total funding to $20 million — First Round Capital previously led a $4 million seed round.
Customers include Square, Opendoor and Codecademy. Thus far, the company has tracked more than 500 million visitors, and gotten 600,000 survey question responses.
The UserLeap team is currently made up of 15 people, with females representing 50% and people of color making up 33% of the leadership team. Across the company, women represent 32% of the team and people of color represent 42%.
“UserLeap cares deeply about diversity and inclusion,” said Glasgow. “Having a diverse team helps to ensure our employees feel comfortable and valued so that they can bring their whole selves to work. For that reason, UserLeap has a part-time recruiting sourcer dedicated to engaging underrepresented candidates and these efforts have contributed towards our diversity goals.”
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