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Thursday 30 September 2021

SoftBank-backed Oyo files for $1.16 billion IPO

SoftBank-backed Oyo files for $1.16 billion IPO

Oyo is ready to explore the public markets. The eight-year-old Indian budget hotel giant has filed the paperworks with the local market regulator for an initial public offering, in which it is seeking to raise about $1.16 billion.

The Gurgaon-headquartered startup — which offers an operating system of sorts to help hoteliers accept digital bookings, payments, determine the best pricing for a room, and integrates with third-party booking services — is seeking to raise about $942 million through sale of new shares, while the rest is set aside for sales of existing shares (secondary transaction).

The startup — which counts SoftBank, Airbnb, Lightspeed Venture Partners, Sequoia Capital India, and Microsoft among its investors and was most recently valyed at $9.6 billion — has not offered a ton of other details about what it is looking for from the retail investors, but here’s what we know: as we reported earlier this week, Oyo is seeking a valuation of over $12 billion in the IPO. And the startup’s young founder — Ritesh Agarwal — doesn’t plan to sell his shares in the public offering.

The filing today marks a major turnaround for Oyo that grew too ambitiously in international markets in recent years but corrected course by hitting brakes on some of those efforts.

Much like every other hospitality and travel firm, Oyo was also severely disrupted by the pandemic. At one point, the startup reported that its business was down by up to 60% as several nations enforced lockdowns as they scrambled to contain the spread of the virus.

But it has been showing signs of fast recovery in recent weeks as some of its key markets opened up in recent quarters. The startup said in the filing today that four markets — India, Indonesia, Malaysia, and Europe — account for about 90% of its overall revenue.

Oyo has also improved its finances and streamlined its relationship with hotels in recent quarters. The startup today doesn’t own any hotel of its own and instead works with over 157,000 partners and helps them operate hotels, resorts, and homes. It doesn’t promise any minimum guarantees to those partners.

The story of Oyo — in which currently SoftBank has over 45% ownership — starts with Agarwal, who left his rural town in search of a better education in Rajasthan. He often visited his friends in Delhi and stayed at their houses or rented cheap hotels. That’s when Agarwal, then in his late teens and a recent college dropout, spotted a budget hotel that was struggling to fill its rooms each night.

Agarwal then, he has said in the past conversations, convinced the hotelier to broker a deal to let him renovate the hotel and started marketing it to businesses in exchange for a cut of future commissions.

That deal immediately proved to be a success, which then propelled Agarwal to explore broadening his offering — now using technology — to focus on what were the neglected segments of the market.

That’s the beginning of Oyo, which immediately found success and soon enough attracted the attention of a fellowship run by the foundation of PayPal co-founder Peter Thiel.

Oyo first assumed the market leading position and then started to expand — beginning with Southeast Asia, Europe, China, and the U.S., to name a few markets. Its aggressive expansion bet has had a mixed success rate. It’s doing well in Europe and Southeast Asia, but making inroads in China and North America have proven to be more difficult than the startup likely assumed.

At the height of that expansion, Agarwal, 27, invested $700 million into the startup. That year, he announced that he was planning to spend $2 billion through an entity called RA Hospitality Holdings to raise his stake in Oyo to 30%, from 10% prior to the $700 million investment.

Oyo said in the filing that its app has been downloaded more than 100 million times and 70% of its workforce lives in India. As of December 2019, it said in the filing, the startup viewed its total addressable market opportunity as serving 54 million short-stay storefronts.

Catherine Shu contributed to this story.



And that’s that, as the Zoom deal to buy Five9 is called off

And that’s that, as the Zoom deal to buy Five9 is called off

Talk about a roller coaster ride.

Zoom, the video conferencing company that became everyone’s primary means of communication around work during the pandemic, will no longer be acquiring Five9, a maker of cloud-based customer-service software. Though the all-stock deal, announced in July, was expected to enable Zoom to tap into the lucrative contact center market, a few major hiccups along the way seemingly led to today’s decision.

First, Zoom’s shares, which moved in nearly a straight line toward the sky over the last couple of years, have more recently come under pressure, so the deal for Five9, which was valued at $14.7 billion in July, would have been considerably less today given that Zoom’s shares were trading at around $360 when the deal was announced and are now trading at closer to $260 per share.

It certainly didn’t help matters that, last week, Zoom disclosed that a U.S. Justice Department-led panel has been investigating the tie-up over concerns that it might create national security risks given Zoom’s ties to China.

Founder Eric Yuan is a naturalized American citizen who was born in China and moved to the U.S. as a 27-year-old in 1997. (Several years ago, we talked with Yuan about overcoming numerous hurdles to do this.) Zoom also said last year that it had mistakenly routed some meetings through servers in China and that it shut down the account of an activist who was using the platform to commemorate China’s Tiananmen Square crackdown. Afterward, the company, which has said previously that a sizable part of its development team is in China (as is the case with many multinational companies), announced it would not permit requests from the Chinese government to impact anyone outside of mainland China.

Still, the figurative nail the coffin might have been a recommendation two weeks ago by the proxy advisory firm Institutional Shareholder Service that Five9 shareholders vote against the acquisition, owing to its concerns about Zoom’s slowing growth.

That advice appears to have been heeded, with Five9 today issuing a news release that the merger plan had been “terminated by mutual agreement” between the two companies. It was also expected, evidently. As news broke that the deal was off, shares of both Zoom and Five9 barely budged.



Foxconn will build EVs for Lordstown Motors and Fisker at Ohio plant

Foxconn will build EVs for Lordstown Motors and Fisker at Ohio plant

Foxconn will build electric vehicles for Lordstown Motors as well as its other partner Fisker Inc. at a former GM factory in Ohio, under an agreement announced Thursday.

Lordstown Motors, the beleaguered electric vehicle company that became publicly traded via a merger with a special purpose acquisition company, said Thursday it reached a nonbinding agreement with Foxconn to sell its 6.2-million-square-foot factory. Lordstown purchased the factory in 2019 from General Motors.

Under the agreement, which has yet to close, Foxconn will pay $230 million for the facility. The deal excludes certain assets such as Lordstown’s hub motor assembly line, battery module and packing line assets and certain intellectual property rights. Foxconn will also buy $50 million of Lordstown common stock.

The companies said they will negotiate a contract manufacturing agreement for Foxconn to assemble Lordstown’s Endurance full-size pickup truck at the facility. Reaching a contract manufacturing agreement is a condition to closing the facility purchase. The parties have agreed to explore licensing arrangements for additional pickup truck programs.

The deal comes at a critical moment for Lordstown Motors, a cash-strapped startup turned SPAC that had a string of missteps earlier this year. In August, the company hired Daniel A. Ninivaggi, a longtime automotive executive and former head of Carl C. Icahn’s holding company, as CEO and a board member. The appointment came after months of tumult at the company, including the resignation of its founder and CEO Steve Burns. CFO Julio Rodriguez resigned following a disappointing first-quarter earnings report that revealed the company was consuming more capital than expected and unable to reach previously forecasted production numbers for its electric Endurance pickup truck.

The goal of the partnership, the companies said in its announcement, is to present both Lordstown Motors and Foxconn with increased market opportunities in scalable electric vehicle production in North America. That includes Foxconn’s existing partnership with EV company Fisker Inc. (Lordstown and Fisker are separate companies and have no connection.)

In May, Fisker signed an agreement with Foxconn to co-develop and manufacture a new electric vehicle under a program called Project PEAR. Production on the Project PEAR car, which stands for Personal Electric Automotive Revolution, will be sold under the Fisker brand name in North America, Europe, China and India. Pre-production is expected tp begin in the U.S. by the end of 2023 and will then ramp up into the following year, Fisker told TechCrunch in an an August interview.

Fisker didn’t reveal the U.S. manufacturing location. The final decision would be Foxconn’s, Fisker noted at the time.

Fisker issued a statement Thursday welcoming the news from Foxconn.

“Achieving key program objectives such as time to market, access to a well-developed supplier ecosystem and overall cost targets were all important factors in the decision to locate manufacturing in Ohio,” Henrik Fisker said in an emailed statement. “Since signing the agreement with Foxconn earlier this year, we have been working together intensively on all aspects of Project PEAR including design, engineering, supply chain and manufacturing. Fisker’s commitment to volume manufacturing in the United States takes another important step forward today with the signing of this agreement.”

Fisker also has another vehicle program in the works with a different contract manufacturer. The Fisker Ocean SUV will be assembled by automotive contract manufacturer Magna Steyr in Europe. The start of production is still on track to begin in November 2022, the company reiterated in its second-quarter earnings call. Deliveries will begin in Europe and the United States in late 2022, with a plan to reach production capacity of more than 5,000 vehicles per month during 2023. Deliveries to customers in China are also expected to begin in 2023.



Tech giants brace for impact in India as new recurring payments directive goes into effect

Tech giants brace for impact in India as new recurring payments directive goes into effect

Apple, Sony, Google, Zoom, PayPal and several other tech companies as well as scores of banks have cautioned customers and partners in India to expect a surge in declined transactions as the world’s second-largest internet market’s central bank enforces a new directive for the way recurring payments are processed in the country.

The Reserve Bank of India’s directive, which goes into effect on Friday, requires banks, financial institutions and payment gateways to obtain additional approval for auto-renewables transactions worth over 5,000 Indian rupees ($67) from users by conducting notifications, e-mandates and Additional Factors of Authentication (AFA). The directive impacts all such transactions for debit cards as well as credit cards.

The directive, which was first unveiled in 2019, was scheduled to go into effect in April this year but was extended to September 30 after banks and other players said they were not fully prepared to comply.

India’s central bank was not amused by the way the industry handled its directive, saying in March that “any further delay in ensuring complete adherence to the framework beyond the extended timeline will attract stringent supervisory action.”

The Reserve Bank of India said in the original circular in 2019, that the framework was designed to serve as “a risk mitigant and customer facilitation measure,” adding that the issuer processing such transactions “shall send a pre-transaction notification to the customer, at least 24 hours prior to the actual charge by SMS or email, as per the customer’s preferences.”

Several companies have reminded their customers and in some cases, other business partners, about the new directive.

On Wednesday, Apple reminded developers that due to the new directive, “some transactions that don’t meet these requirements will be declined by banks or card issuers.”

HDFC, the largest private bank in India, has posted the following message on its website: “Please note: Effective 1st Oct 2021, the Bank will NOT approve any Standing Instruction (e-Mandate for processing of recurring payments) given at Merchant Website / App, on HDFC Bank Credit card/Debit Card, unless it is as per RBI compliant process.” Several banks, including HDFC, Axis and Kotak have said this week that they will be complying with the new rule.

In May this year, Google stopped on-boarding new recurring payment customers on its Play Store. The company told developers that free trials and introductory pricing should be removed from the apps until “the ecosystem challenges are addressed.” YouTube has moved to support only a prepaid — pay as you go — payments acceptance model for its Premium service.

In the same month, Amazon said it was “temporarily” discontinuing new member sign-ups for Amazon Prime free trial until further notice. There hasn’t been any change to that notice since.

The directive doesn’t impact recurring payments made through UPI, a payments infrastructure built by a coalition of retail banks. Which explains why some firms — including Netflix — have added support for auto-pay on UPI in the country.

But its impact is likely to be far-reaching. A fintech founder told TechCrunch that the payments provider they use to advertise on Facebook and Google had informed them that their automatic-payments won’t be processed starting later this week, citing the central bank’s rule. The founder requested anonymity to discuss what he deemed to be sensitive.

The new rule is the latest in a series of guidelines the Indian central bank has proposed or enforced in recent years. As Pratik Bhakta outlines in a post on The CapTable, the moves illustrate that though the regulator has encouraged the proliferation of fintech startups that are innovating for users, the RBI is closely watching whether any trend is attempting to hurt those consumers.

“Until legislation catches up, regulation has to adapt to ensure that the financial system absorbs digital innovation in a non-disruptive manner,” said RBI Deputy Governor T Rabi Sankar at a conference earlier this week. “We would only be able to reach a thriving and mature payments system if, over time, all stakeholders attach due importance to long-term improvements over short-term gains and internalise mature practices like informed consent and transparency of data usage.”

In emails to PlayStation Plus subscribers on Thursday, Sony said, “From 30 September 2021, you may see your credit and/or debit card payments for PlayStation Plus fail when trying to pay for a subscription on PlayStation Store.”

“This applies to both new subscription purchases and payment of recurring subscription fees. This means that any future PlayStation Plus subscription fees set up to be charged automatically may fail. If that happens, your PlayStation Plus subscription will come to an end.”



What you should know about working with corporate venture investment committees

What you should know about working with corporate venture investment committees

Brian Walsh Contributor
Brian Walsh is the head of WIND Ventures, the venture capital arm of COPEC, a leading energy company in Central and South America and the U.S. WIND Ventures provides mobility, energy and retail startups and scaleups with access to Latin America.
More posts by this contributor

With global corporate-venture-capital-backed (CVC) funding reaching $79 billion across 2,099 deals in the first half of 2021, according to CB Insights, the chances are high that startups will find great opportunities with this growing investor set.

Entrepreneurs, however, are likely to discover that the investment process can be different for CVCs compared to private venture capital firms. While both types of investment firms tend to make decisions via an investment committee (IC), private VCs (inclusive of VCs with corporate backers that have an independent LPA structure) make up their ICs with firm partners and/or other venture-minded people.

As CVCs become more active, entrepreneurs often don’t understand that the decision to invest, or not, doesn’t rest solely within a subgroup of the direct investment team or with venture-minded people.

But for CVCs investing off a corporate balance sheet, the IC can include corporate-minded people, such as the CEO or business unit leaders, who generally tend to be detached from the venture mindset and the requirements for operating in the VC world. As such, entrepreneurs will realize that a successful CVC investment decision tends to have different requirements compared to a private VC firm’s decision.

So what do entrepreneurs seeking investment need to know about this relatively new but powerful participant in the funding process? I’ll do my best to demystify the role of the CVC IC and shine a light on how entrepreneurs can navigate some of the hidden pitfalls while taking advantage of the opportunities.

The arbiters of investment

While private VCs immerse themselves into the venture ecosystem, CVCs live in the middle of two very different worlds and mindsets: corporate and venture. The CVC must engage the venture ecosystem to attract deal flow while also driving opportunities that can be of strategic interest to the corporation.

To do this well, a CVC ideally should have a well-defined mandate and IC purpose statement — to deem investment opportunities as strategic, for example. A business unit leader or CEO who spends about an hour on a monthly IC session is nearly completely immersed within the corporate mindset while making a decision related to the venture world.



Evil Geniuses CEO on the path toward esports ubiquity

Evil Geniuses CEO on the path toward esports ubiquity

The pandemic brought a new class of gamers online for the very first time, and the gaming space has never been larger or more diverse. At the same time, while esports saw some viewership gains in the past year, it still had to deal with plenty of hurdles tied to pandemic restrictions on physical events.

At TechCrunch Disrupt, we recently sat down with Evil Geniuses CEO Nicole LaPointe Jameson who helms one of the oldest esports leagues around as one of the youngest CEOs in her class. We chatted about the challenges facing the esports industry to keep pace with a rapidly diversifying audience and the opportunities for building a league that can adjust to those shifts faster than others.

Evil Geniuses (EG) was founded in 1999 and has had a winding journey since. LaPointe Jameson got involved when the Chicago-based firm she worked for, Peak6 Investments, took over EG as part of an Amazon divestment following its acquisition of Twitch, which had previously owned Evil Geniuses. The capital injection came at a time when esports leagues were finally catching the attention of institutional investors who saw big opportunity in the space.

Years later, that potential is still there, but the path toward mainstream embrace has been more circuitous than many had hoped. Hard viewership numbers are hard to come by but signal a subindustry that’s growing more slowly than the overall industry it sits inside. Still, LaPointe Jameson believes the industry has plenty of room left for rising players to innovate and create new opportunities for the whole industry.



Alloy raises $100M at a $1.35B valuation to help banks and fintechs fight fraud with its API-based platform

Alloy raises $100M at a $1.35B valuation to help banks and fintechs fight fraud with its API-based platform

Alloy, which has built an identity operating system for banks and fintechs, announced Thursday that it has raised $100 million at a $1.35 billion valuation.

Lightspeed Venture Partners led the Series C round, which comes just over one year after New York-based Alloy raised $40 million in a Series B financing. Existing backers Canapi Ventures, Bessemer Venture Partners, Avid Ventures and Felicis Ventures all put money in the latest round, bringing Alloy’s total raised to over $150 million since its 2015 inception.

Alloy was founded primarily to fix a “broken” onboarding process that has historically involved manual review when people applied for bank accounts online. Put simply, the startup’s initial mission was to help banks and fintechs make better identity and risk decisions using its single API service and SaaS platform. 

Over the last year, Alloy has evolved that platform to not only automate onboarding identity decisions but to also automate transaction monitoring and soon, credit underwriting. Also over the past 12 months, the company has seen its annual recurring revenue (ARR) triple and number of customers double, according to Alloy CFO Kiran Hebbar. Today, the company has more than 200 clients, including Ally Bank, HMBradley, Brex, Marqeta, Gemini, Ramp and Evolve Bank & Trust — up from 90 at this time last year.

Alloy connects its users to data from 120 identity providers, and then uses that data to help financial institutions avoid fraud during initial customer onboarding and when conducting ongoing transactions. Questions it aims to answer for banks and fintechs include: “Is this a real person? Will they defraud us?”

And it does it by giving them a way to create instant decisioning systems that are customized to their needs from a regulatory compliance and risk perspective.

“It’s really hard for fintech companies and banks to deploy products that are both safe for them, meaning they won’t take on a bunch of fraud or compliance losses, but also seamless for their users,” said CEO and co-founder Tommy Nicholas.

What has historically ended up happening is that financial institutions’ efforts to mitigate risk have resulted in less than ideal user experiences.

“Our entire mission is to make that go away and have risk be something you can just install and put into the background to solve all the problems of users who can take money from you,” Nicholas told TechCrunch. “And we’ve gotten really good at helping them automate and optimize those processes. We’re basically asking people to take the most important processes that they run and put those into one central system.”

As more companies become fintechs, or rather embed things like payments into their platforms (e-commerce companies are a prime example), Alloy has seen an increase in the number of companies that could take advantage of what it does, according to Nicholas.

Also, as mentioned above, the company has now expanded into transactional monitoring, with plans to launch a product focused on credit underwriting later this year.

Image Credits: Alloy

The startup plans to use its new capital mainly toward building out “continuously evolving” customer identity profiles that can be used to prevent fraud and minimize risk. Down the line, Alloy plans to incorporate “richer data and risk signals” with the mission of giving banks and fintechs a 360-degree view of their customers. It also, simply, wants to improve the developer experience.

“We want to make building a fintech product as easy as building an e-commerce product,” Nicholas said. “Identity and its associated risk isn’t something businesses should be figuring out, it should just be something they install. As Alloy grows…we can not only help make risk easier to understand, but also further industry innovation by making fintech products easier to build.”

Justin Overdorff, partner at Lightspeed Venture Partners, first invested in Alloy as an angel in its Series A round of funding in 2019.

“When that round happened, I acutely had firsthand knowledge and experience of this problem at Stripe, going through the process of cobbling together sources of data for many years,” he recalls.

The process, he said, was “very, very challenging.”

“You want to say yes to as many of the best customers as possible,” Overdorff said, “but you don’t want false positives or to turn away good customers, because every good customer you turn away, that’s revenue that’s lost.”

That experience made him “intrigued” by what Alloy was building.

“For me the exciting thing is that revenue is growing rapidly, the company is growing rapidly,” he told TechCrunch. “I think the big picture here is that the opportunity is just quite large. There’s a proliferation of the number of financial service companies, both big and small, and even to some extent some software companies, that are embedding financial services in their products….And every single one of those companies is going to need to onboard customers and go through that KYC (Know Your Customer), AML (Anti-money laundering) onboarding process initially.”



Spotify rolls out podcast polls and Q&As to creators and users worldwide

Spotify rolls out podcast polls and Q&As to creators and users worldwide

Spotify earlier this year began beta testing new features to make podcasts more interactive through the use of listener polls and Q&As. Today, the company says these features will become publicly available to all creators through its podcast creation app, Anchor.

To use the new options, creators who publish and distribute using Anchor will be able to post a question or poll alongside their episode. At present, Anchor supports adding just one poll and one Q&A to an individual episode, not several.

When the podcast is published on Spotify, the polls and Q&As will appear at the bottom of the podcast’s episode page on the Spotify mobile app, both iOS and Android. Listeners can then follow the prompt to respond to the poll or Q&A in the app.

Image Credits: Spotify

After responding to the poll, listeners will immediately be able to view how the rest of the podcast audience voted so they can see how their own answers stacked up. But their Q&A responses are delivered privately to the podcaster. The podcast creator can choose to pin specific responses that will appear publicly below the question. These will display the listener’s Spotify username, so the feature should be used with that in mind. In other words, this feature is the podcast equivalent of the radio call-in — except it’s not live or recorded audio from the listener, it’s text.

These features have been in testing before today’s public launch with hundreds of creators throughout the year. During this time, the company says creators have used Q&As to ask for suggestions for future guests, get feedback about topic choice and format, and add gamification elements to their programs, where listeners are encouraged to return to hear what the hosts say about the listeners’ response.

Image Credits: Spotify

The new features are now being made available to any Anchor creators and Spotify users in 160 markets around the world. This is not Spotify’s entire global footprint, which is today 178 markets per its website. But it is a large majority.

Interactivity is just one way that Spotify has been working to revamp the traditional podcast experience. The company has also rolled out paid podcast subscriptions, a combined “Music + Talk” show format, and an app for hosting “live” shows, called Spotify Greenroom.



Ola Electric raises $200 million at $3 billion valuation

Ola Electric raises $200 million at $3 billion valuation

Ola Electric said on Thursday it has raised over $200 million in a new financing round at a valuation of $3 billion, up from $1 billion two years ago, as it looks to scale its electric vehicle manufacturing business in the South Asian market.

Falcon Edge Capital and SoftBank Vision Fund 2 co-led the financing round, the Bangalore-based startup said. TechCrunch reported last month that the startup was in talks to raise at over $2.75 billion.

The fundraise follows Ola Electric recently launching its first electric scooter, called Ola S1, that is priced at 99,999 Indian rupees, or $1,350. The electric scooter offers a range of 121 kilometers (75 miles) on a complete charge. The startup said it had sold scooters worth $150 million in just two days.

The startup, which was once the part of the ride-hailing giant Ola, said it will deploy the fresh funds to accelerate development of other vehicle platforms including electric motorbike, mass market scooter and its electric car. It’s also setting up what is the world’s largest manufacturing factory for electric scooters. The 500-acre factory in the Southern Indian state of Tamil Nadu will have a capacity to produce roughly one electric scooter every two seconds.

“We’re proud to lead the EV revolution from India to the world. India has the talent and the capability to build technologies of the future for the industries of the future for the entire world. I thank our existing investors and welcome new ones to Ola. Together we will bring mobility to a billion and sustainability to the future,” said Bhavish Aggarwal, founder and chief executive of Ola, in a statement. Aggarwal is also the founder and chief executive of Ola Electric.

In recent quarters, Aggarwal has urged New Delhi, and players in the industry to evolve from using gasoline-powered vehicles and switch to those run by electric by 2025.

Meanwhile, Ola is seriously exploring the public markets and may file the paperworks for an initial public offering this year. Ahead of it, the startup recently closed a $500 million financing round from Temasek, Warburg Pincus, and Agarwal.

India’s startup ecosystem, a journey which kickstarted in late 2000s, is finally beginning to produce firms that have matured to stages where they can become public companies. And retail investors are showing great interest, too.

Food delivery startup Zomato had a stellar debut on Indian stock exchanges earlier this year. Scores of other firms including Paytm, MobiKwik, CarTrade, Nykaa, and PolicyBazaar have filed the paperworks for their initial public offerings. Indian hospitality giant Oyo is expected to follow suit as soon as this week, TechCrunch reported earlier.



Tiger Global backs India’s OfBusiness at $3 billion valuation

Tiger Global backs India’s OfBusiness at $3 billion valuation

OfBusiness, a commerce startup that sells industrial goods and provides small businesses with credit, has doubled its valuation in less than two months to $3 billion.

Tiger Global led the six year-old startup’s $207 million Series F round, and SoftBank and Alpha Wave participated in it, OfBusiness said. The new investment comes just two months after SoftBank led a $160 million round in OfBusiness at a $1.5 billion valuation.

Thursday’s announcement is the third financing round for OfBusiness this year. The startup, whose business has grown multiple folds this year, was valued at $800 million in April this year.

OfBusiness operates as a raw material aggregator and procurement finance provider. The startup works with banks to offer credit lines to small and medium enterprises that have an annual turnover of over $3 million.

The platform collects data on user activity that it relies on to underwrite loans to businesses that are using the OfBusiness platform for sourcing raw material and tenders. “This enables us to move from collateral based loans to cash-flow/ transaction-based lending – a key differentiator to banks,” the startup’s co-founder and chief executive Asish Mohapatra told Bernstein analysts last year.

“The SMEs pay interest on their working capital loan (issued in form of card limits), and a margin on the raw material procured. Bid-Assist platform is a repository for SMEs to look up tenders suitable for their business. The tender sourcing and raw material margin provide better monetization and more importantly, predictive data useful for underwriting.”

The startup’s revenue run-rate is over $1 billion, and it’s profitable. By July this year, its loan book size had increased to $220 million.

“We provide credit lines, akin to cash-credit/ overdraft. Borrowers pay interest only on the limits drawn and are required to procure raw material from the platform. This provides us with a view on end-use of the loan and data for fresh underwriting and monitoring. Borrowers using leverage for inventory are better than those using loans to pay off old loans.”

The startup plans to deploy the fresh funds to expand its operations in India. OfBusiness is also eyeing merger and acquisitions opportunities, the startup said.

OfBusiness is Tiger Global’s latest investment in India. The New York-headquartered firm has backed nearly two dozen startups in the country this year, including Apna, BharatPe, Gupshup, DealShare, Classplus, Urban Company, CoinSwitch Kuber and Groww.

Tiger Global goes super aggressive in India



Matternet’s automated drone-docking station makes its real-life debut in Switzerland

Matternet’s automated drone-docking station makes its real-life debut in Switzerland

No one knows exactly how drone delivery will fit into the future of logistics, but one thing is for sure: the aircraft aren’t going to drop off important payloads directly onto someone’s lawn. Matternet’s Station, an automated landing space and payload control tower, may be the solution, and the flower-like structure has finally made the jump from render to reality at a medical facility in Switzerland.

The Station was teased early last year, but one never knows with these concept renders whether the final result will be anything like the idea. In this case it’s dead on, looking for anything like a prop from a ’60s sci-fi flick.

The unusual shape serves a purpose, however, providing a safe place for a cargo drone to land and swap its battery out, protected from the elements and the type of ne’er-do-wells who would snatch a medical payload from an innocent robot.

That package, in the case of this first installation, will be a temperature-sensitive hardshell case with numerous vials inside that would normally be transferred overland. These might be lab samples, blood, medications, anything that has a short shelf life and needs to travel between facilities for one reason or another.

A woman sorts vials to put in a SwissPost carrier for a drone to take to another facility.

Image Credits: Matternet

Inside the Station, the case is removed from the craft and stored for retrieval by someone authorized to take it — there’s a little collection door secured by the same kind of badge you might use to key into a restricted area at the hospital. The idea is to integrate it with the usual authentication systems, and make a drone delivery as simple as a pneumatic tube, cart, or manila envelope but without the necessity of being in the same building.

The first Station is in Lugano, at the EOC Hospital Group, but the first big deployment will be in Abu Dhabi, where the company will be working with SkyGo and the city’s health department to build a network of 40 Stations around the city. These would be used for the same general purpose — relatively lightweight and urgent medical deliveries — but on a larger scale:

Map of the proposed Matternet/SkyGo network in Abu Dhabi.

Last month Matternet became the first drone company to transport Pfizer vaccine doses between locations — the kind of short-term logistics any hospital network or health department would love to be able to pull off. Big rush on shots downtown? Airlift a couple hundred doses from the distribution center or a nearby clinic rather than sending people away.

Of course, the idea that such a valuable payload might just land in the courtyard or on a random roof is unacceptable — hence the Station as a prerequisite for this type of network. Don’t hold your breath on getting one in your back yard, though.



Found comes out of stealth with $32M in funding, former Bumble exec as its new CEO

Found comes out of stealth with $32M in funding, former Bumble exec as its new CEO

Found, a startup focused on weight care management, is emerging from stealth today with $32 million in total funding and the news that it has appointed former Bumble COO Sarah Jones Simmer as its new chief executive.

Austin-based Found was incubated at Atomic, a San Francisco-based venture studio in the spring of 2020. Earlier this year, it raised $24 million in a Series A round led by GV (formerly Google Ventures) and Atomic, with participation from Define Ventures. And over the course of the last year, it raised $8 million in previously unannounced seed funding, largely from Atomic in addition to Define Ventures.

Jack Abraham, co-founder of Found and Atomic managing partner, said the startup was built to address the “challenging” issue of weight care while incorporating telehealth. (Abraham also is a co-founder of hims and hers, a telehealth service for wellness and care.)

“With over 70% of the population overweight or obese and these numbers increasing at a concerning rate, we saw a need for a personalized, science-based approach to help bend the curve,” said Abraham, who initially started Found with Atomic’s Emily Yudofsky.

And while some point solutions exist for a specific medication or treatment, Abraham added, Found was started in an effort to offer “a comprehensive, tailored, and precision-based solution to help anyone looking to lose weight.”

By comprehensive, he means that the startup draws from “dozens” of medications, supplements, diet plans, exercise routines and coaching programs to help its members achieve their personal weight and health goals.

Since its 2020 launch, Found has helped “tens of thousands” of members lose over 200,000 pounds, according to co-founder and COO Swathy Prithivi, who had served as the company’s interim CEO before Jones Simmer’s hiring earlier this month. It is currently available in 31 states at an “average” cost of $100 per month with a variety of plans.

“A lot of what spurred creating Found was that obesity is a disease, not a decision, and that it’s time that we modernized weight care so that obesity is treated like a disease and not a decision,” she told TechCrunch.

Weight, continued Prithivi, is “deeply stigmatized” as a category.

“We’ve all been told to eat less and move more, and then shamed for our lack of willpower when we don’t see success,” she said, “but there’s very little success to be seen when 50% of the U.S. is on diets but only 5% lose weight. And this is despite decades of research that show us that losing weight and keeping it off is more than just diet and working out.” 

Found, she said, aims to help people focus more on body positivity and what they can “find” — such as being able to finish a 5K or keeping up with their grandkids or a newfound confidence — during their weight management journey. And it does it by combining advice from clinicians, a community of others going through the same process and “prescription interventions” when deemed necessary. The company aims for a holistic, personalized and integrated approach that includes addressing sleep, “mindful” eating, movement, stress and a person’s biology.

Jones Simmer comes to Found from Bumble, where she essentially led that company’s entire initial public offering. During that process, she was battling Stage 3 breast cancer — doing drafts of the S-1 from a chemo chair and sending it to the board the morning of her double mastectomy.

The move to Found from a company she’d worked at from its early days of being founded out of a two-bedroom apartment was, in large part, a personal one that stemmed from her experience in fighting cancer. She was also drawn to the company’s mission to fight stigma around obesity and weight loss in a similar way that Bumble fought stigmas around online dating.

“I entered remission very shortly after the IPO, and after a pretty grueling year or so of treatment that I think was like, 20-plus rounds of chemo, multiple surgeries and 37 rounds of radiation,” Jones Simmer said. “ All of that really causes you to reflect on how you want to spend your days and what’s important to you.”

So despite her deep respect for Bumble CEO and founder Whitney Wolfe Herd, and love for the company and team, Jones Simmer left Bumble earlier this year because she wanted to “take a bet” on herself.

“At one point during my fight with cancer, my doctor gave me a timeline that made me reconsider whether I had a lifetime to achieve my personal and professional goals,” she said. “My prognosis looks better now, but my viewpoint has changed permanently.”

Plus, she says, she missed building and wanted to go back to something earlier stage.

“I wanted the chance to integrate the lessons I learned at Bumble and really think about building something else that had a similar opportunity for impact and that could touch people’s lives,” Jones Simmer told TechCrunch.

Today, Found has 130 employees, including its coaching staff, and a large part of its capital will go toward expanding its headcount. The company also announced today that it has named Alexandre Linares as its new chief product officer. Linares previously served as the VP of product at Headspace, where he oversaw product and growth for the app, which today serves an estimated 70 million people.

GV Partner Frederique Dame, who has also invested in the likes of Pill Club and Kindbody, has joined Found’s board as part of the Series A.

She said she backed Found because its mission resonated with her. 

“Found takes a fresh approach to helping people lose weight, bringing the weight clinic model online with personalized, evidence-based coaching designed to improve patient outcomes,” wrote Dame via email.

Also, Dame and Prithivi worked closely together at Uber from 2012 to 2016.

“I always admired her focus and dedication to operational excellence,” Dame said.

Found, she believes, is unique in two key ways. For one, its toolkit’s diversity, which includes medication tailored to one’s needs, coaching support and community. And second, its approach to stigma and attempting to shift the narrative around weight management.

“It’s the most integrated platform, and the most tailored to your needs,” Dame told TechCrunch. “And, Found makes access to care easy and convenient, while emphasizing body positivity and self acceptance.”



DNA-based data storage platform Catalog raises $35M

DNA-based data storage platform Catalog raises $35M

Conventional electronic media like flash drives and hard drives require energy consumption to process a vast amount of high-density data and information overload and are vulnerable to security issues due to the limited space for storage. There is also an expensive cost issue when it comes to transmitting the stored data.

To solve the problems of traditional electronic media, a startup in Boston, Catalog, was founded in 2016 by MIT scientists including co-founder and CEO Hyunjun Park, developing an energy efficient, cost competitive, and more secure data storage and computation platform by using synthetic DNA.

The startup announced today it has secured a $35 million Series B round to continue developing its DNA-based data computation tools.

South Korea’s Hanwha Impact led the Series B round and was joined by existing backer Hong Kong-based Li Ka-Shing’s Horizons Ventures, CEO Hyunjun Park said in an interview with TechCrunch.

The latest funding will be used to accelerate development of Catalog’s synthetic DNA-powered computing platform, which enables data management, computation, and automation. Over the next two to three years, Catalog also plans to put more investment into developing computation functions, Park told TechCrunch. The platform is expected to be commercialized around 2025, Park said.

The company, which is a member of DNA Storage Alliance, will continue to support collaborators and partners of the DNA-based computing system for helping the industry grow, according to Park.

The Series B brings its total funding up to approximately $60 million; Park declined to disclose its valuation. This round comes after a $10 million Series A led by Horizons Ventures in 2020 and a $9 million seed round in 2018 co-led by New Enterprise Associates and OS Fund and other investors, Park said.

While the concept of using DNA as a medium for data storage and computing has been around for years, a lot of the work has been relegated to the academic realm. Catalog has discovered the means to incorporate DNA into algorithms and applications with potential widespread commercial use through its proprietary data encoding scheme to automation.

“Catalog’s proprietary approach to writing information into DNA, namely its encoding scheme, is revolutionary in that minimal de novo DNA synthesis is required to store a tremendous amount of information. Because the low speed and high cost of DNA synthesis have traditionally been the bottleneck in this field,” Park explained.

Catalog’s custom-developed DNA writer, Shannon, is capable of hundreds and thousands of chemical reactions per second. Shannon, which is designed to write at a speed of over 10Mb/sec at full capacity, stores up to 1.63Tb of compressed data in a single run.

Expected applications for Catalog’s technology include fraud detection in financial services, image processing for defect discovery in manufacturing, and digital signal processing such as seismic processing in the energy sector.

“Catalog has worked with companies in IT, media, entertainment, and energy sectors. Through this work, we have discovered the broad applicability of our [DNA-based data storage and computing] platform across industries and heavy data users,” Park said. He added that the dozen or so companies working as co-development partners and collaborators are based in the US and Europe.

The IT industry has witnessed a proliferation of purpose-fit technologies over the last several years, including accelerators (GPUs, FPGAs), quantum computers, as well as extreme parallel computers. The advent of the DNA-based computer complements this portfolio, emphasizing low-energy, spatially dense, and secure computing, divorced from the realities and limitations of electronic systems, as per its statement.

“As a reference point, the high-performance computing market is currently about $40 billion annually, and growing rapidly,” Park said when asked regarding the global market size.

“Companies including Microsoft, Twist, Illumina, and Western Digital formed the DNA Storage Alliance earlier this year. Catalog is a member of this organization and is taking this to the next level by focusing on computation and thereby enabling enterprises to generate business value from data that otherwise would have been thrown away or left in cold storage,” Park said.

“Catalog’s technology represents a viable pathway to solve the issue of not only mass data accumulation and preservation but more importantly, the effective usage of data,” said Nick Ha, vice president of Hanwha Impact Partners.

Early this year, Catalog opened an office in Seoul, South Korea, a wholly subsidiary of Catalog, for Asia expansion, Park noted.

Genetics startup Twist Bioscience is working with Microsoft to store the world’s data in DNA



Spudsy bags $3.3M to turn ‘ugly’ sweet potatoes into snacks

Spudsy bags $3.3M to turn ‘ugly’ sweet potatoes into snacks

Spudsy, a brand that upcycles imperfect sweet potatoes and turns them into plant-based snacks, announced Thursday that it raised $3.3 million in Series A funding in a round led by KarpReilly and Stage 1 Fund.

With the new funding, the company has raised a total of $6.5 million since the company was founded three years ago, Ashley Rogers, Spudsy founder and CEO told TechCrunch.

“Being a young brand, we don’t know everything, and these investors have a portfolio of food and beverage companies and have been doing this forever,” she said. “Their expertise and guidance has provided us checks and balances and connected us with Amazon and direct-to-consumer agencies.”

Rogers has been in the food industry for the past seven years and had founded another brand called Buff Bake, a protein cookie.

She sold her share of the company to her business partners and started Spudsy when she saw a white space in the market for a brand that focused on sweet potatoes to compete against others that were making snacks from other vegetables.

“We started with puff snacks — they were on trend and [we] saw no one else doing it,” she added.

In addition to the puff, which comes in five flavors, Spudsy launched a sweet potato “fry,” similar to a straw, in four flavors over the past year.

Spudsy claims that 150 million pounds of sweet potatoes end up in landfills due to minor imperfections like shape, size and color. The brand is currently working with a farm in South Carolina to use the potatoes left in the field and is on track to save 1 million of these so-called flawed sweet potatoes by the end of 2021, Rogers said.

Starting in the salted snack aisle made the most sense for the company. Salty snacks is one of the top-selling items in the snack category, accounting for $27 billion in sales in the United States in 2017, according to Statista. Rogers estimates that this has grown in the past four years to be between $30 and $36 billion.

However, her vision for the company is to “become a platform brand and live in different areas of the grocery store,” including frozen foods, bread, tortilla and any other carb. Spudsy products are already in Whole Foods, Kroger and Sam’s Club.

The company built out much of its executive suite last year and will focus some of the new capital to hiring, but most of it will go to supporting the “ton of national retailer” inquiries Spudsy is receiving and investing in store demonstrations.

Having launched the fries product line two months ago, most of the company’s focus is there for now, but Rogers is also looking at direct-to-consumer and Amazon sales.

“We have dabbled in DTC, but not focused on and plan to get that working next year,” she added.

Chinese startups rush to bring alternative protein to people’s plates



Empathy raises $30M for a personal assistant that helps with the practical and emotional process of bereavement

Empathy raises $30M for a personal assistant that helps with the practical and emotional process of bereavement

Death is one of the hardest things to cope with in life, both from an emotional and organizational standpoint. And what’s worse is that the latter of these is inevitably compounded by the fact that those left behind are grieving and focused on that. Unsurprisingly, tech that is being built to help in these situations is seeing a lot of traction.

Empathy, a startup that emerged from stealth earlier this year with a digital assistant aimed at helping bereaving families navigate those choppy waters resulting from the death of someone close to them — with a diverse range of services, from providing links to counselling to helping plan estate paperwork and taxes — is capitalizing on that opportunity. It has now raised $30 million in funding on the back of some very strong interest in its services.

The Series A is coming just five months after Empathy announced a $13 million seed round. Entrée Capital led the latest investment, with previous backers General Catalyst and Aleph (which co-led the seed), LocalGlobe, Primetime Partners, and prominent angel investors including Shai Wininger (CEO & Co-Founder of Lemonade), Sir Ronald Cohen, John Kim (ex-President of New York Life), and Micha Kaufman (CEO & Co-Founder of Fiverr) all investing.

The company is not disclosing its valuation.

Part of the reason for the swift arrival of the Series A is to help Empathy keep up with what has proven to be strong early demand. The company’s tech was built in Israel but it chose to launch in the U.S. first, where co-founder and CEO Ron Gura tells me that it’s already amassed a “nice, single digit percent” of the market, in the form of seeing some 250,000 bereaved executors visiting and using Empathy’s services each month. Those services range from practical estate planning and tax tools through to links for counseling and other support.

“Some visitors are practical, and some come to find meaning,” he said. It’s a tricky balance when you think about it — having one side by side with the other inevitably might offend those looking specifically for one service, only to be confronted by another, so that Empathy has managed to build and operate such a platform is an achievement in itself.

It’s also building out its business by partnering increasingly with other stakeholders in the end-of-life process, be they hospice centers or funeral homes. To date, it has some 300 cemeteries and 72 funeral homes referring customers to Empathy, Gura told me. The reason for this is simple: bereaving families often start to ask questions of the people who are connected to those final stages, but those people’s focus is the job at hand, as much as they’d like to help with other aspects and to provide comfort.

“When families come into the hospice, the truth is around the corner,” Gura said, “and they turn to the coordinator. And the coordinators all want to do is help: they are usually good people who work in a complex field, but they have limited resources and capabilities as they need to move on to the next family.

“The funeral director is the closest thing to a concierge in this situation,” he added a little bit of irony, but also just talking straight.

It is indeed not an easy job, and not a glamorous one, but it has to be done, and so to have a company building some help that takes some of the pain of figuring things out for yourself, in a way that’s not an invasive and expensive business in itself (some services are totally free; others are not) is not such a bad thing.

“We are proud to continue to support Empathy as it strengthens its position as a market leader in the end-of-life industry and provides a service that is incredibly necessary for families struggling with loss,” said Joel Cutler, MD of General Catalyst, in a statement. “Empathy has proven both its commitment and its determination to reach as many families as possible, partnering with companies across different sectors to connect with diverse audiences, as well as recruiting the best and the brightest to further their mission. We look forward to seeing Empathy continue to prove how technology can make a major difference for bereaved families.”



Elevation Capital, General Catalyst lead $12M round into health insurance startup Loop Health

Elevation Capital, General Catalyst lead $12M round into health insurance startup Loop Health

Loop Health aims to be the “Oscar Health of India” and targets the country’s health insurance gap with its approach to primary care and insurance.

The Pune-based company is also the latest startup to raise funding in this area, bringing in $12 million in Series A funding in a round co-led by Elevation Capital and General Catalyst. Joining the two firms is Vinod Khosla, through Khosla Ventures, YC Continuity Fund, Tribe Capital and a group of angel investors, including NoBroker founder and CEO Amit Kumar Agarwal, Livspace founder and COO Ramakant Sharma, Meesho co-founders Vidit Aatrey and Sanjeev Barnwal, Carbon Health co-founder and CEO Eren Bali, Codecademy co-founder and CEO Zach Sims and Maven Clinic founder and CEO Kate Ryder.

The new funding gives Loop Health a total of $14 million in funding since it was founded in 2018, Mayank Kale, co-founder and CEO, told TechCrunch. This includes a previous $2.3 million seed raise. The company was part of Y Combinator’s Winter 2020 accelerator program.

Kale, who was previously building digital patient health records across India, started the company with Ryan Singh, Amrit Singh, and Shami Raj to provide group health insurance plans from large insurers to companies of all sizes that includes a virtual primary care experience through Loop Health’s in-house medical team and network of service providers.

It is estimated that fewer than 15% of people in India have purchased healthcare insurance, and of those who have it, most plans only work on hospitalizations and medical procedures, Kale said. Loop Health aims to change that by providing ongoing care so that a person shouldn’t have to go into the hospital unless necessary.

“In talking to potential customers, half of them are buying insurance for the first time,” Kale added. “Now employees are asking for it so that the company is competitive with others providing the benefit, but then COVID made it one of the central benefits to people. The sentiment has flipped now.”

Loop Health app. Image Credits: Loop Health

Legacy insurance plans don’t typically provide coverage for most diseases for up to four years after purchasing it, but with Loop Health, 40% of Loop’s customers consult a Loop doctor in the first three months on the plan, Kale said.

Over the past 12 months, the company has begun working with over 150 companies that represent about 50,000 total members, including Shaadi.com, rediff.com, Helpshift, Knorr-Bremse, Shoptimize, Weikfield and Moonshine Meadery. Loop Health has a target to cover 1 million members by the end of 2022 and 5 million members across Southeast Asia over the next five years.

At the same time, the company has grown 50% month over month in revenue and went from 10 employees to about 80 operating in Pune, Mumbai and Bengaluru. That includes 15 care specialists, Kale said.

Khosla Ventures leads Even’s $5M seed to give India the kind of healthcare their insurance doesn’t

To keep the momentum going, he intends to use the new round of capital to onboard more members, build physical healthcare clinics, hire in sales, engineering and product development.

“We will keep growing quickly and are on track to onboard a couple hundred more companies over the next 18 months,” Kale said. “We are optimizing for trust. We want to be the trusted healthcare provider, and we will do that by providing a health concierge that responds to calls in 50 seconds, provides same-day consultations, personalized care plans for chronic disease and financial cover when patients need it.”

In addition to Loop Health, other startups are addressing health insurance in India. For example, this investment follows a seed round that Khosla Ventures made into healthcare membership startup Even. Meanwhile, Tiger Global led a $15.6 million Series A round into Plum, a startup enabling employers to provide insurance coverage to their employees, and Policybazaar raised $75 million this year for its insurance marketplace.

Mayank Khanduja, partner at Elevation Capital, considers Loop Health primarily a healthcare company that also provides insurance. Insurance is difficult to figure out, and many policyholders are even unsure of which hospital to even go to, he said.

He estimates the market to be valued at $3.5 billion and growing annually at 20% to 25%. It is a deep enough pool for someone like Loop Health to attack it and grow fast, especially with the push by employees driven by COVID.

“This was missing in India,” Khanduja added. “Insurance is sold in India as a commodity product — something to keep in the drawer to hold and hope you don’t have to use it. That is what is exciting to us about Loop Health. They are providing corporate insurance, but then also a full suite of primary care intervention, which will hopefully take care of you to where you don’t need hospitalization.”

Insurtech is hot on both sides of the Atlantic



Speedata emerges from stealth with $70M and groundbreaking chip technology to accelerate big data analytics processing

Speedata emerges from stealth with $70M and groundbreaking chip technology to accelerate big data analytics processing

Datacenters are taking on ever-more specialized chips to handle different kinds of workloads, moving away from CPUs and adopting GPUs and other kinds of accelerators to handle more complex and resource-intensive computing demands. In the latest development, a startup called Speedata, which is building a processor (fabless) to cover the specific area of big data analytics, is coming out of stealth and announcing $70 million in funding to continue building its product and embark on its first commercial deals. In a market that’s seeing a proliferation of purpose-built chipsets these days, Speedata claims to have, in its own words, “the world’s first dedicated processor for optimizing cloud-based database and analytic workloads.”

The news comes after a period in which Israel-based Speedata has piloted its tech with a mix of large companies — hardware makers, end users, big-name cloud providers — to show how it can speed up their workloads, which it has, by some two orders of magnitude, CEO and co-founder Jonathan Friedmann told TechCrunch. Speedata is a fabless chip startup, so the next steps will be to produce the chips and ink commercial deals, likely with some of those running tests with the company.

Speedata was founded in 2019 and has been in stealth since then, and so the funding getting announced today is actually in two parts. First, there is a $15 million seed round led by Viola and Pitango that dates from some time back. And second, a newer $55 million Series A led by Walden Catalyst Ventures, 83North, and Koch Disruptive Technologies (KDT), with Pitango and Viola participating, alongside Eyal Waldman, co-founder and former CEO of Mellanox Technologies.

Friedmann and others on the founding team — the other co-founders are Dan Charash, Rafi Shalom, Itai Incze, Yoav Etsion and Dani Voitsechov — have an impressive track record in the worlds of academia and the chip industry, with multiple exits and groundbreaking patents behind them — one key factor in the company accruing so much backing without a single commercial deal yet to its name. “We were grossly oversubscribed for this round,” he said.

The reason Speedata has focused on big data analytics is that, first of all, it’s been a hard problem to solve for the fragmentation in data sources (and before you wonder, the company is not disclosing how and why it was able to make this breakthrough now; the stealth element persists). And second of all, because, in Friedmann’s words, “it’s probably the biggest workload in the datacenter” and so is overdue for more dedicated processor attention beyond the CPUs and FPGAs that are currently being used to support it.

To be clear, its focus on big data analytics is not the same as computing AI workloads, an area currently dominated by Nvidia, although Nvidia also becomes a potential competitor as it expands its own horizons.

That is also why striking while the iron is hot is of the essence for Speedata right now, he added. One reason it has yet to be addressed is because it’s only really starting to emerge as a bottleneck now.

Data, and the generation of it in the enterprise, is currently exploding exponentially — Speedata cites research from IDC that projects the amount of data that will be created in the next three years will exceed the amount created in the past 30.

But analytics processing around that is no longer advancing at the rate it used to — in part because of that volume of data — and so looking at how to fix that by way of better processors is a multidisciplinary problem, Friedmann said. “It’s a human problem, but also one of networking improvements and needing a deep understanding of what is going on in the deep learning software,” he said.

“We really have a once in a lifetime opportunity,” he said. “We are approaching a huge, not niche, market. Analytics covers about 50% of the expense in a data center, so that is a huge market. There are so many things to do around that.”

The payoff of course is gaining much deeper insights and knowledge that can help in many areas such as medical research, financial services, cybersecurity, autonomous systems and more. Big data analytics is projected to be a $70 billion market by 2025, and that implies better hardware and services built to support that.

“Datacenter analytics are being completely transformed, and accelerated processors are set to play a substantial role in this revolution,” said Waldman in a statement. “Much like NVIDIA’s GPU revolutionized the AI space, Speedata’s unique APU will transform database computing. Data processing is a swiftly growing, multi-billion-dollar market in which acceleration will unleash the use of data in the applications of tomorrow and help countless entities reliant on big data innovate and compete. I look forward to supporting this extraordinary team as they reimagine big data processing for years to come.”



Alphabet gives some Loon patents to SoftBank, open sources flight data and makes patent non-assertion pledge

Alphabet gives some Loon patents to SoftBank, open sources flight data and makes patent non-assertion pledge

Alphabet’s Loon was a stratospheric moonshot that saw the company fly high-altitude balloons to provide cellular network coverage to target areas. The project broke a lot of new ground, including developing technology that enabled balloons to navigate autonomously and stay in one area for long stretches of time, but ultimately came to an end. Now, Alphabet is divvying up the Loon assets, many of which are being either made available to others in the industry for free — or handed over to key partners and strategic investors.

SoftBank is one company that walks away with some intellectual property; the Japanese telecommunication giant gets around 200 of Loon’s patents related to stratospheric communications, service, operations and aircraft, which it says it will put to use developing its own High Altitude Platform Stations (HAPS) business. SoftBank was an erstwhile partner of Loon’s, having founded the ‘HAPS Alliance’ to further the industry. SoftBank’s own HAPS business focused on autonomous gliders, but it adapted its communications payloads to work on Loon’s balloons, too. SoftBank is also an investor in Loon, having put $125 million in the Alphabet company in 2019.

The other company to get a windfall of sorts out of Loon’s closure is Raven, another partner and a company that focuses on the manufacture of the high altitude balloons that the Alphabet moonshot operated. It picks up patents related specifically to balloon manufacturing. Neither SoftBank nor Raven had to fork over any money in order to pick up that IP.

Testing the impact of lightning on Loons hardware in the lab.

A significant chunk of the rest of Loon’s work and accomplishments will be made available generally to advance the state of the art in stratospheric science and industry. Alphabet has open sourced data from Loon’s collective 70 million kms or so of flight, including GPS and sensor data. The company also made a non-assertion commitment for 270 of its patents and patent applications, dealing with everything from balloon launching, to in-flight navigation, to managing balloon fleets and more. For would-be stratospheric balloon mavens, and the general public, Loon also compiled a book about the Loon experience, which is available as a free PDF embedded below.

The temptation to draw Icarus comparisons with this particular project is very high, but Alphabet’s moonshots have a higher than average possibility of failure baked in from the start so it’s not really that apt. Also, the fact that all of this IP and data gets made available to the public is a pretty good outcome for the scientific community, too.



Fairphone adds a 5G smartphone, touting software support until at least 2025

Fairphone adds a 5G smartphone, touting software support until at least 2025

Dutch social enterprise Fairphone has announced its first 5G smartphone, the Fairphone 4.

The ‘greentech’ mobile maker differentiates from almost the entire smartphone industry through a promise of sustainability via repairable modularity.

It combines this with a big push around socially responsibility and ethical electronics — touting fairly sourced materials and better conditions for workers (through a living wage program) across a supply chain that spans the dirty business of mining rare earth minerals and all the other components used in making mobile devices, as well as the handset manufacture itself.

The Fairphone 4 comes with a five year warranty and a guarantee of software support until the end of 2025 — including upgrades to at least Android 12 and 13. (It runs Android 11 out of the box.)

The startup also hopes to be able to extend the phone’s lifespan even further — saying its goal is software support until 2027 and upgrades to Android 14 and 15 too.

The new flagship follows the launch of the Fairphone 3+ last year — which enabled owners of its prior top-of-the-range handset to upgrade to for as little as €70 just by swapping out a few modules.

Fairphone’s new flagship, the 3+, costs just €70 as a modular upgrade

Prioritizing reuse to reduce e-waste is a key goal for Fairphone — so even though it’s announcing another new phone this year it is taking steps to avoid being accused of creating more e-waste by generating demand for new hardware.

The Fairphone 4 is the first it’s made that’s being billed as “electronic waste neutral” — as it says it will “compensate” users’ phones and spare parts by “responsibly recycling one phone (or an equal amount of small electronic waste) for every Fairphone 4 sold”. Or else take back and refurbish at least one other phone to prevent the production of a new one.

In another development towards its ambitious goal of making truly sustainable and ethical personal electronics, Fairphones notes that it’s been able to expand its list of fairly obtained materials, adding six new ones. In the Fairphone 4 these include Fairtrade-certified gold, aluminium from Aluminium Stewardship Initiative (ASI) Performance Standard certified vendors, fair tungsten from Rwanda, recycled tin, rare earth minerals and plastics.

Consumers have long been holding onto smartphones for considerably longer than upgrade cycles of the early years of the market as the space has matured and device refreshes have become increasingly iterative.

Simultaneously environmental concerns are also stepping up driving changes in how consumers buy and use mobile devices. So the new shiny thing, in consumer demand terms, might actually be keeping the old shiny thing for as long as possible and responsibly recycling it when it finally comes to the end of its run.

In Europe, lawmakers are also considering right to repair legislation.

Fairphone’s modular design, which allows the user to easily swap out and replace components (like the screen, battery and camera) if a part of the device breaks or malfunctions, may provide a glimpse of the future of consumer electronics — if regulators go down the path of mandating repairability in order to tackle e-waste and incentivize reduced consumption as part of measures to decarbonize the economy and respond to the climate crisis.

Image credits: Fairphone

Commenting on the launch of the Fairphone 4 in a statement, Eva Gouwens, CEO of Fairphone, said: “We want to challenge the traditional way of designing devices, including the notion that thinner is better. The starting point in development was to produce a premium sustainable smartphone that is future-proof, easily repairable, designed to last and therefore more circular and fair.”

The tech specs of Fairphone’s latest device have also had a boost vs the previous flagship — so as well as 5G the phone comes with either 6GB or 8GB of RAM and 128GB or 256GB of storage, a Qualcomm Snapdragon 750G chipset, beefed up rear & front cameras and a 6.3in display, among other tweaks.

The handset will be available for pre-order from today via Fairphone’s website and through selected partners, with RRP at €579 (for 6GB RAM/128GB) or €649 (8GB RAM/256GB).

The two variants will be released in Europe on October 25 through Fairphone’s network of regional distributors.

Available colors for the handset are grey for the 6GB device; and grey, green and green speckled (exclusively through Fairphone’s website) for the 8GB handset. 

The startup is also branching out to expand its product portfolio — adding its first non-mobile product, a pair of wireless earbuds, which are made with 30% recycled plastics and with Fairtrade Gold integrated into its supply chain.

Can Fairphone 3 scale ethical consumer electronics?



VertoFX picks up $10M for cross-border payments play in emerging markets

VertoFX picks up $10M for cross-border payments play in emerging markets

VertoFX, a global B2B payments platform that allows small and medium-sized enterprises (SMEs) to make payments to their suppliers, today announced that it has closed $10 million in Series A funding.

Quona Capital, an emerging fintech-focused venture capital firm, led the round. Other firms also participated, including The Treasury, founded by Betterment’s Eli Broverman and Acorns’ Jeff Cruttenden; Middle East Venture Partners (MEVP); U.K.-based TMT Investments; Unicorn Growth Capital; Zrosk Investments; and P1 Ventures. 

The lack of interoperability between African currencies is primarily behind why a Kenyan business owner who wants to pay an invoice to another business owner in South Africa with either shillings or rands ends up using the dollar — the currency that powers almost 80% of Africa’s bilateral trade.

As trade and supply chains become increasingly global, international payments remain a complicated and expensive proposition. The case is particularly problematic in emerging markets like Africa, where local currencies are less liquid than those in developed markets. 

While fintechs are creating solutions around peer-to-peer payments and remittances, most are consumer-focused. Meanwhile, the B2B market, accounting for 30% of the world’s global imports and 45% of total employment in emerging markets — is largely untouched.

Hence the reason why Ola Oyetayo and Anthony Oduwole started VertoFX in 2018. And instead of focusing on Africa, the two U.K.-based Nigerians took an emerging markets approach.

Initially, the YC-backed company acted as a currency exchange marketplace to help businesses transact illiquid currencies into liquid pairs. But upon gaining transaction and subsequently raising a $2 million seed round two years ago, feedback from users highlighted the importance of providing cross-border payments as well.

VertoFX raises $2M for its African and EM currency trading platform

It is not hard to see the value chain: a business going to a platform to swap or exchange one currency for another invariably does that intending to pay another business in a different country.

“We’ve now evolved more from not just being a currency exchange marketplace to a full suite of cross border payments product for businesses,” Oyetayo told TechCrunch.

On the VertoFX platform, businesses can exchange money in over 200 countries across 39 currencies, up from 120 countries and 19 currencies the last time the company spoke with us.

Per its website, VertoFX is designed for freelancers, SMEs and corporates, providing payments, exchange and multi-currency accounts to each segment.

These business owners can send cross-border B2B payments at FX rates up to nine times cheaper than they could through traditional banks, CEO Oyetayo said. And most importantly, without a fee.

A no-fee proposition has caught on well with a userbase of over 2,000 businesses, each transacting an average of $30,000. Together they have facilitated billions of dollars in transaction volume yearly, according to the company. 

The CEO says since the start of the pandemic, VertoFX’s user growth has grown 11x and 8x in revenue without giving specific numbers.

Similar to most fintechs, the company has benefited from a global shift of people moving to digital methods of payments and the fact that more homogeneous businesses in Africa are transacting with each other through digital channels.

Not only can businesses use VertoFX for their personal payments needs, but they can also piggyback on the company’s rails to build solutions for their end clients. For instance, an investment management platform that allows customers to buy stocks on its platform can use Verto to convert currencies and facilitate pay-ins and payouts.

“That solution is geared towards developing markets where it takes businesses to pay customers days or weeks to make payments,” said Oduwole. “Our in-house compliance solution allows them to transact and get settled instantly, or in some cases a couple of hours.”

If cross-border payments are free, how then does the company make money? VertoFX takes a small amount of commission when businesses use its currency exchange service and charges a 1% commission when they use its price discovery marketplace solution.

In the future, at some point, VertoFX “will potentially start making revenue of API calls, and also revenue off payments made on the platform,” the CEO said.

In a statement, Monica Brand Engel, the co-founder and managing partner at lead investor Quona Capital (also a backer of Nigeria’s Cowrywise), hails the platform’s ability to address problems businesses face with low visibility, slow speeds and high costs of cross-border payments. VertoFX is doing “important and impactful work,” she said.

Before the end of the year, VertoFX expects to increase the list of currencies on its platform to 51, CTO Oduwole said. The company will use the investment to achieve that while building its platform to enable businesses to move money across borders more efficiently, it added in a statement.

Interestingly, VertoFX has only six African currencies on its platform; they cover 60% of the continent’s GDP. And with the B2B global payments industry expected to grow to almost $200 trillion by 2028, VertoFX plans to accelerate its geographical expansion into more markets in Africa and the Middle East.

“We want to get to a point in the future where someone can easily swap a Ghanian cedi to rand without having to transact with dollars or euros,” the founders said.

They also pointed out that the company, in a way, drives financial inclusion for businesses that could not move money from, say, India to Turkey without going to a bank. VertoFX is placing businesses in underserved regions on an even playing field as their counterparts in developed markets, said the CEO.

“Ultimately, we want to help a business in an emerging market send money to another business elsewhere, as easy as sending a text message.”



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