Pinwheel is the API platform for income verification that every fintech and neobank needs


This post is by Danny Crichton from Fundings & Exits – TechCrunch

A lot of founders start building one idea and in the process, find another one that is more alluring. Perhaps the most well-known example is Tiny Speck, a game publisher of a relatively uninteresting MMORPG where the founders grew sufficiently frustrated with their internal team communications tools that they migrated from game building to designing a chatting app known as Slack.

That’s the story of Pinwheel and its founders Kurt Lin, Anish Basu, and Curtis Lee. Lee, who formerly founded Luxe, a valet service that sold to Volvo in 2017, had hired Lin as the company’s GM. After two years of “innovating” within the confines of a massive automobile manufacturer, the two were ready to spin out and head back to the open world of startups. Meanwhile, Lee and Basu had worked together previously at social gaming company Zynga on Mafia Wars, and connected the whole group together for a new project.

The big question was what to build. They started by developing a software platform for companies to easily offer their employees pre-tax benefits like expensing transit passes and funding health savings accounts. They hit a programming wall though: there was no easy way to connect their product to the myriad of payroll providers out there.

“We had built an internal platform with integrations into payroll systems … and what we realized as we were building was that there was kind of no solution out there that both aggregated and unlocked access in payroll systems largely because they’re very old and kind of closed systems,” Lin said. As they talked with other fintech founders about how to solve the roadblock, they realized that the lack of an API that they could use for their product was actually a potential product in and of itself.

And so came the idea for Pinwheel, an API layer for payroll data that handles everything from income and employee verification to easily switching and managing direct deposit. The company officially came out of stealth today and announced that it has raised a $7 million seed round from Josh Kopelman at First Round Capital and Greg Bettinelli at Upfront Ventures, who will both join the company’s board.

Like any API platform, there are a range of users and data that they want to connect to. For consumers, the main draw is automated direct deposit control, which will allow consumers to control where their paychecks go. For instance, if they want to split a direct deposit into multiple accounts, or regularly move part of their paycheck into a savings app like Digit or Acorns, Pinwheel can help them do that easily.

But the real interesting use cases start coming with other fintech business users of the platform. Take mortgages for instance. The process to apply for a mortgage is arduous, requiring numerous documents to prove income and employment status. Some of that is now digital — you can use tools like Notarize to digitally sign documents — but few options exist to directly pull payroll data into a unified, machine-readable format for all use cases. “Even in 2020 right now, most people still have to submit a paper pay stub or tax document every time they need to substantiate [their] data,” Lin said. Pinwheel wants to be the layer to power all of this data flow.

Kopelman of First Round says that it is precisely financial applications like mortgages and lending that attracted him to the company. “You take what would happen in four weeks and [Pinwheel] turns it into four minutes,” he said.

He first learned about the company during a board meeting of one of his portfolio companies and was intrigued. As he dug in, he liked that the founders “were extremely focused on the users” and he liked the focus on payroll. “It’s the source of truth and the source of funding,” he said. He noted that First Round has invested in a variety of future of work companies like Uber and TaskRabbit, and saw firsthand the need for better options for accessing payroll data easily and securely.

According to Pinwheel, 82% of Americans get paid via direct deposit — which means that the vast majority of income data is sitting in payroll systems.

Pinwheel is not a replacement for incumbent payroll providers like ADP or upstart companies like Gusto. Instead, it layers on top of them, much in the way that, say, Plaid is a layer on top of existing banks to provide other fintech companies secure access to a user’s banking data.

With Luxe, Lin and Lee formerly built an on-demand valet service, and I was curious what they learned from that experience and how that affected their approach to Pinwheel. Lee said that the big difference was understanding what works and what doesn’t when it comes to building valuable companies. “Certain businesses are just conducive to better outcomes versus others,” he said. He noted that compared to an on-demand business like Luxe, Pinwheel’s API play was not as capital intensive, had limited marginal costs, and it’s a pure technology play, making it easier to create value for the startup.

One other change: the team moved from San Francisco where Luxe was headquartered to New York City, where Pinwheel is based.

In the company’s current roster, Lin serves as CEO, Basu as CTO, and Lee is executive chairman. Lee is also a venture partner at NYC-based Primary Venture Partners.

In addition to First Round and Upfront, Wonder Ventures participated as did angels such as Adam Nash, the former CEO of personal finance manager Wealthfront and Mike Vaughan, former COO of payment app Venmo.

Invia Robotics Announces $20M Series B

Exciting days for Invia Robotics.

I am super excited to partner with @DanGwak and P72 Ventures team on the @InviaRobotics $20M Series B investment. I believe what @liorelazary and his entire team are building is some of the most exciting technology coming out of #LongLA.

We originally invested in Invia Robotics a year ago (before there were any real customers) and already their low-cost goods-to-person robotics solution is seamlessly integrating directly with human workers to automate fulfillment systems in the commerce warehouses. Live. In the wild.

The robots pick and deliver totes and trays directly to pickers, eliminating unnecessary, wasteful travel time in the warehouse aisles. The system merges with existing warehouse management software, offering a more complete solution with predictable costs and scalability.

We are lucky to have great partners like Rakuten Super Logistics and @Hollar who are actively using and expanding their Invia Robotics solutions.

As an example, this great video shows off our autonomous mobile robots actually working their way through the @Hollar warehouse. The inVia robots have increased productivity in some functions by as much as 5x already.

The reality is warehouse automation is now an essential part of any competitive commerce supply chain. Dominant retailers like Amazon have set a high bar for order fulfillment, delivery and scale.

We are super excited about how Invia moves forward.


Invia Robotics Announces $20M Series B was originally published in Upfront Insights on Medium, where people are continuing the conversation by highlighting and responding to this story.

The Changing of the Live Ticketing Experience

It is no secret that Venture Capitalists like myself love startups operating in categories ripe for disruption — but what does that really look like? Well, it is a category whose standard technology was built on outdated principles. Whose business model is too entrenched by incumbents to properly modernize. Who is deeply unpopular or broken for its end-users. And where a clear technological or social change is clear and inevitable.

In what now feels like a previous life, I spent six-years of my career in live event ticketing (at eBay, StubHub and LiveNation), so I know firsthand that the category is one of the most outdated, unpopular, entrenched, and broken industries around. That is why I’m so excited for our investment in live event platform Rival, announced to the public today. My worlds are colliding.

Despite being a $100B industry ($35B alone in the US), the business of event ticketing really

Continue reading “The Changing of the Live Ticketing Experience”

Softbank Vision Fund: What the Hell?

That was literally my first question when I sat down at the Upfront Summit a few weeks ago to interview Colin Fan and Lydia Jett from Softbank’s Vision Fund. Along with — how does a team think about deploying $100B of capital? What post-investment value comes alongside the capital? And have they ever lost a deal?

Colin and Lydia answered all this (mostly) and more, giving the audience insight into Softbank and Masa Son’s 30-to-300 year vision for their portfolio companies — companies they expect to be historically transformational. You will also hear their perspective on why “they don’t have enough money to invest,” why they hope to catalyze other investors into larger, longer-term investments, and how Masa is here to “suspend the real world.”

I truly enjoyed this discussion and encourage you all to watch the full interview, below. Thanks to Colin Fan and Lydia Jett for their participation.

Softbank Vision Fund: What the Hell?

That was literally my first question when I sat down at the Upfront Summit a few weeks ago to interview Colin Fan and Lydia Jett from Softbank’s Vision Fund. Along with — how does a team think about deploying $100B of capital? What post-investment value comes alongside the capital? And have they ever lost a deal?

Colin and Lydia answered all this (mostly) and more, giving the audience insight into Softbank and Masa Son’s 30-to-300 year vision for their portfolio companies — companies they expect to be historically transformational. You will also hear their perspective on why “they don’t have enough money to invest,” why they hope to catalyze other investors into larger, longer-term investments, and how Masa is here to “suspend the real world.”

I truly enjoyed this discussion and encourage you all to watch the full interview, below. Thanks to Colin Fan and Lydia Jett for their participation.

Softbank Vision Fund: What the Hell?

That was literally my first question when I sat down at the Upfront Summit a few weeks ago to interview Colin Fan and Lydia Jett from Softbank’s Vision Fund. Along with — how does a team think about deploying $100B of capital? What post-investment value comes alongside the capital? And have they ever lost a deal?

Colin and Lydia answered all this (mostly) and more, giving the audience insight into Softbank and Masa Son’s 30-to-300 year vision for their portfolio companies — companies they expect to be historically transformational. You will also hear their perspective on why “they don’t have enough money to invest,” why they hope to catalyze other investors into larger, longer-term investments, and how Masa is here to “suspend the real world.”

I truly enjoyed this discussion and encourage you all to watch the full interview, below. Thanks to Colin Fan and Lydia Jett for their participation.

Automation is Coming to Commerce … And Why That’s a Good Thing

When we order something online, we want it yesterday…and for free. For this to happen, after an item is ordered, in the time it takes to stream of a Master of None episode, it needs to be picked and packed in the appropriate fulfillment warehouse, sorted and loaded onto the next departing truck, routed through transportation hubs for consolidation and deconsolidation, and finally put on a box truck for delivery to your home or place of work. Oh yeah — that doesn’t come cheap: probably $10/$15 per order.

Of course expertise in merchandising, pricing and product differentiation have been the table stakes for any commerce provider since the original general store, and whether online or offline they will never stop iterating and competing on merchandise. But giving consumers not just what they want, but how, where, and when they want it is the holy grail — and in the coming years, I believe as a

Continue reading “Automation is Coming to Commerce … And Why That’s a Good Thing”

Automation is Coming to Commerce … And Why That’s a Good Thing

When we order something online, we want it yesterday…and for free. For this to happen, after an item is ordered, in the time it takes to stream of a Master of None episode, it needs to be picked and packed in the appropriate fulfillment warehouse, sorted and loaded onto the next departing truck, routed through transportation hubs for consolidation and deconsolidation, and finally put on a box truck for delivery to your home or place of work. Oh yeah — that doesn’t come cheap: probably $10/$15 per order.

Of course expertise in merchandising, pricing and product differentiation have been the table stakes for any commerce provider since the original general store, and whether online or offline they will never stop iterating and competing on merchandise. But giving consumers not just what they want, but how, where, and when they want it is the holy grail — and in the coming years, I believe as a

Continue reading “Automation is Coming to Commerce … And Why That’s a Good Thing”

Second-Order Market Innovation and The Future of Drones

Lady Gaga at Super Bowl LI; Image courtesy of Intel

One of the most exciting parts of watching a new technology and market develop is observing the ancillary opportunities created that may not have been obvious initially. Often, these second-order innovations present meaningful investment opportunities, as the initial technology has enabled a market to develop and created fertile ground for new, related ideas to take root; sometimes, these ideas are actually solutions to brand new problems that this technology has created. Happy Returns is a great example from my own experience — the team is tackling a problem (convenient, in-person retail and broken reverse return logistics) that never existed before the rise of e-commerce, and is creating real value to all involved stakeholders.

I am also watching the rise of the commercial drone industry closely and am excited about drones’ ability to drive huge business value in both the short and long

Continue reading “Second-Order Market Innovation and The Future of Drones”

Second-Order Market Innovation and The Future of Drones

Lady Gaga at Super Bowl LI; Image courtesy of Intel

One of the most exciting parts of watching a new technology and market develop is observing the ancillary opportunities created that may not have been obvious initially. Often, these second-order innovations present meaningful investment opportunities, as the initial technology has enabled a market to develop and created fertile ground for new, related ideas to take root; sometimes, these ideas are actually solutions to brand new problems that this technology has created. Happy Returns is a great example from my own experience — the team is tackling a problem (convenient, in-person retail and broken reverse return logistics) that never existed before the rise of e-commerce, and is creating real value to all involved stakeholders.

I am also watching the rise of the commercial drone industry closely and am excited about drones’ ability to drive huge business value in both the short and long

Continue reading “Second-Order Market Innovation and The Future of Drones”

DroneBase: Long Term Disruption, Immediate Business Impact

Aerial footage via DroneBase

At the risk of stating the obvious, the very industry of venture capital is about investors taking a chance on companies, industries and markets that are not yet fully developed. That’s because true value creation — the kind of billion dollar-plus businesses — takes time, unbelievable effort, and more than a little good fortune. We are investing on the potential of a market or solution, in most times years before the business will have a scalable product. Sometimes, that means we pick companies with potential for long-term global impact or in companies with a bleeding-edge product that will be a catalyst for making a currently niche market a mass market one. We also invest in a phenomenal founder with the proverbial “unfair advantage” in a category, even if all they have is an idea or an early working prototype.

In any of these scenarios, investing for long-term disruption is a

Continue reading “DroneBase: Long Term Disruption, Immediate Business Impact”

DroneBase: Long Term Disruption, Immediate Business Impact

Aerial footage via DroneBase

At the risk of stating the obvious, the very industry of venture capital is about investors taking a chance on companies, industries and markets that are not yet fully developed. That’s because true value creation — the kind of billion dollar-plus businesses — takes time, unbelievable effort, and more than a little good fortune. We are investing on the potential of a market or solution, in most times years before the business will have a scalable product. Sometimes, that means we pick companies with potential for long-term global impact or in companies with a bleeding-edge product that will be a catalyst for making a currently niche market a mass market one. We also invest in a phenomenal founder with the proverbial “unfair advantage” in a category, even if all they have is an idea or an early working prototype.

In any of these scenarios, investing for long-term disruption is a

Continue reading “DroneBase: Long Term Disruption, Immediate Business Impact”

GOAT raises $5 million to help sneakerheads buy and sell covetable kicks

Footwear is evaluated for authenticity and condition before being shipped to a GOAT customer. Los Angeles startup GOAT (incorporated as 1661 Inc.) has raised $5 million in new venture funding to grow its mobile-only marketplace for used and collectible sneakers. The GOAT app features everything from Adidas’ Yeezys to Nike’s Jordans and Flyknits, in men’s or women’s sizes, new and used condition. Instead of operating like an open marketplace such as E-bay, letgo… Read More

GOAT: In Defense of the Pivot

The “pivot.” If you spend much time in the VC industry or reading tech press, it starts to sound like a cliche. Like a punchline. A last, desperate scramble to make something out of a business that, rightly or wrongly, couldn’t make their model work the way originally thought or how early metrics had indicated it might.

And when you’re surrounded by examples of failed pivots, it can be easy to become jaded about them. For every successful pivot like a Twitter, Instagram, or Slack, there are countless others, high profile and low profile, that never managed to find product-market fit and simply ran out of runway.

I sometimes say be careful with pivots, as the referee will blow the whistle for traveling. You can lose your key players, key coaches and influential fans and supporters. And yet, sometimes that pivot can create a clear path to the basket leading to

Continue reading “GOAT: In Defense of the Pivot”

GOAT: In Defense of the Pivot

The “pivot.” If you spend much time in the VC industry or reading tech press, it starts to sound like a cliche. Like a punchline. A last, desperate scramble to make something out of a business that, rightly or wrongly, couldn’t make their model work the way originally thought or how early metrics had indicated it might.

And when you’re surrounded by examples of failed pivots, it can be easy to become jaded about them. For every successful pivot like a Twitter, Instagram, or Slack, there are countless others, high profile and low profile, that never managed to find product-market fit and simply ran out of runway.

I sometimes say be careful with pivots, as the referee will blow the whistle for traveling. You can lose your key players, key coaches and influential fans and supporters. And yet, sometimes that pivot can create a clear path to the basket leading to

Continue reading “GOAT: In Defense of the Pivot”

Who is #LongLA?

This is a list of known firms and individuals with a home base or whose investment focus includes Southern California. It includes Accelerators, Angels, Corporate VCs, Family Offices, Hedge Funds, Seed Funds and Traditional VCs.

The list was inspired by @shaig‘s seed fund google doc. Tweet or comment additions, corrections or deletions. “Home base” definition and right to add is at my discretion. Investors w/ known funds are listed under Fund Name (ie: Matt Mazzeo via Lowercase Capital and Michael Eisner via Tornante Company)

Google Doc is accessible here. Originally created July 5, 2014 and has been modified many times.

#LongLA Tech Investor List

Who is #LongLA?

This is a list of known firms and individuals with a home base or whose investment focus includes Southern California. It includes Accelerators, Angels, Corporate VCs, Family Offices, Hedge Funds, Seed Funds and Traditional VCs.

The list was inspired by @shaig‘s seed fund google doc. Tweet or comment additions, corrections or deletions. “Home base” definition and right to add is at my discretion. Investors w/ known funds are listed under Fund Name (ie: Matt Mazzeo via Lowercase Capital and Michael Eisner via Tornante Company)

Google Doc is accessible here. Originally created July 5, 2014 and has been modified many times.

#LongLA Tech Investor List

Who is #LongLA?

This is a list of known firms and individuals with a home base or whose investment focus includes Southern California. It includes Accelerators, Angels, Corporate VCs, Family Offices, Hedge Funds, Seed Funds and Traditional VCs.

The list was inspired by @shaig‘s seed fund google doc. Tweet or comment additions, corrections or deletions. “Home base” definition and right to add is at my discretion. Investors w/ known funds are listed under Fund Name (ie: Matt Mazzeo via Lowercase Capital and Michael Eisner via Tornante Company)

Google Doc is accessible here. Originally created July 5, 2014 and has been modified many times.

#LongLA Tech Investor List

Who is #LongLA?

This is a list of known firms and individuals with a home base or whose investment focus includes Southern California. It includes Accelerators, Angels, Corporate VCs, Family Offices, Hedge Funds, Seed Funds and Traditional VCs.

The list was inspired by @shaig‘s seed fund google doc. Tweet or comment additions, corrections or deletions. “Home base” definition and right to add is at my discretion. Investors w/ known funds are listed under Fund Name (ie: Matt Mazzeo via Lowercase Capital and Michael Eisner via Tornante Company)

Google Doc is accessible here. Originally created July 5, 2014 and has been modified many times.

#LongLA Tech Investor List

Loot Crate: Tapping fandom to build a next-gen commerce company

Fandom is a powerful force, be it affinity to a sports team, an entertainment franchise, a band or musician, a school or university, or even an admired consumer brand. The passion and intense tribal mentality and emotional dedication that exists within and around these communities is something that nearly everyone can relate to on some level (just follow me on Twitter these days and it may seem that all I really care about is the Golden State Warriors NBA Playoff run).

Since my business operating days at eBay, StubHub, and even Live Nation, I have been a huge believer in the power of super-fans and the impact of their passion, even for things that appear to others to be “niche” categories. As a result, businesses that can effectively tap into these unique and sometimes immeasurable fan dynamics can be incredibly attractive. The challenge from an investor perspective is that

Continue reading “Loot Crate: Tapping fandom to build a next-gen commerce company”