Rewarding Savers: HMBradley Raises $18.25M To Bank On Consumer Saving Habits


This post is by Christine Hall from Crunchbase News

As consumers look for ways to make their money earn more money, digital banking platform HMBradley is developing programs to reward savers.

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The Santa Monica, California-based startup closed on $18.25 million in Series A funding to build on its credit program and savings offerings. Acrew Capital led the round, which gives HMBradley approximately $22 million in venture-backed funding since the company was started in 2019.

“Everyone is paid the same interest rate,” Zach Bruhnke, co-founder and CEO of HMBradley, told Crunchbase News. “When you talk to a typical bank CEO, they want long-term, stable deposits that are growing. Consumers want to make more money for their money.”

The young company aims to align those incentives by offering higher annual percentage rates as customers save more. Not everyone will be in the top tier, Bruhnke said, but he believes this approach will drive more adoption.

For example, customers won’t earn dividends if they don’t utilize direct deposit, but people who save up to 20 percent of their earnings will yield up to 3 percent in interest.

“Tiers vary–the average is 2 percent APR–but it is really about aligning consumer behavior with the percentage of income they are saving,” he added.

Banking on engagement

Offering rewards is one of the up-and-coming attraction and retention approaches fintech companies are utilizing. A Crunchbase data search for fintech companies that described offering rewards to consumers yielded a little over 118 venture-backed companies that raised money in the past five years.

Companies raising more than $1 million in the past month include:

Meanwhile, HMBradley unveiled its savings program in April–through an arrangement with Hatch Bank–and has received more than $90 million in deposits. Its deposits doubled month-over-month in October, Bruhnke said.

In July, the company introduced a credit card and its one-click credit application. The card offers 3 percent cash back for purchases in their highest spending category, 2 percent for the next highest category, and 1 percent for all additional charges. Consumers who pair the card with a deposit account earn more.

“One-click credit is going to be the future because consumers will know where they stand and what they are good for in an easy manner,” Bruhnke added. “There is a renewed focus on how to drive deeper in the mindset of customers. Engagement is double what we have seen, and if it continues to grow, we think consumers will expect credit in a different way.”

Vishal Lugani, founding partner at Acrew Capital, supported the Acorns portfolio while he was with Greycroft and said in an interview that he is impressed with how fast the HMBradley team was able to roll out a credit program. It was a testament to the team’s early vision of setting everything up on the back end before launching.

“The engagement I saw with early users of the company was exceptional, measured by the percentage of people sending their paycheck for direct deposit, opting in with the one-click credit, and the staggering percentage of users engaging with their savings goals,” Lugani said. “While other credit card companies’ rewards programs are struggling, HMBradley is rewarding you on what you spend regardless of where.”

Illustration: Li-Anne Dias

The Briefing: CoStar Buys Homesnap, HelloFresh Acquires Factor 75, And More


This post is by Crunchbase News from Crunchbase News

The Briefing

Here’s what you need to know today in startup and venture news, updated by the Crunchbase News staff throughout the day to keep you in the know.

Subscribe to the Crunchbase Daily

CoStar to accquire Homesnap for $250M

CoStar Group, a leading provider of commercial property data, announced that it will pay $250 million in cash to acquire Homesnap, an online platform for real estate agents.

Founded in 2012, Washington DC-based Homesnap previously raised $32 million in venture funding, per Crunchbase data. The company offers an online and mobile software platform used by over 300,000 agents nationwide to help manage workflow and enhance client relationships.

CoStar says it anticipates the addition of Homesnap’s offerings will quadruple the number of professional, paying brokers and active agent users on its U.S. platforms from approximately 100,000 today to over 400,000.

M&A

  • HelloFresh acquires Factor 75: U.S. subsidiaries of  meal kit company HelloFresh announced an agreement to acquire all of the outstanding equity interests of Factor 75, a provider of fully-prepared fresh meals, for up to $277 million.  Of that amount, $177 million is payable upon the closing of the transaction and up to $100 million is structured as a performance-based earn-out,

Funding rounds

  • Gatik raises $25M for autonomous logistics: Gatik, a Palo Alto- and Toronto-based startup developing technology for deploying autonomous vehicles for short-haul  logistics, announced it has raised $25 million in a Series A funding round led by Wittington Ventures and Innovation Endeavors.

Illustration: Dom Guzman

 

Exclusive: Konnecto Lands $3.5M Seed To Provide Consumer Journey Insights


This post is by Christine Hall from Crunchbase News

Consumer intelligence startup Konnecto is putting $3.5 million of seed funding to work to provide brands with data and insights on their customers.

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Using machine learning, Konnecto’s “Reveal & Disrupt” platform applies data science at the SKU level to analyze the digital paths to purchase, then generates actionable recommendations.

“We help on three points: digital customer acquisition, marketing strategy and competitive intelligence before launching a product on the market,” Erez Nahom, CEO of Konnecto, told Crunchbase News. “The product impact can be measured in an increase in customers and a reduction of the marketing budget, while also increasing the ROI.”

The Tel Aviv-based company is backed by TPY Capital, which led the round, as well as Differential Ventures, Magna Capital Partners, SeedIL Ventures and Hike Ventures. Including this new round, Konnecto has raised $4 million in total venture-backed funding since the company was started in 2018, Nahom said.

The consumer analytics market is projected to grow from $10.5 billion this year to $24.2 billion by 2025, according to MarketsandMarkets Research.

Meanwhile, Konnecto is already working with a dozen Fortune 500 companies and plans to use the new funds to increase the size of its data science team, as well as expand into the fast-moving consumer goods and direct-to-consumer industries, Nahom added.

The company is active in the United States, United Kingdom, Germany, Italy and Spain with estimates of 80 percent growth in the next 12 months. Priority for growth will start in those regions, though Nahom aims to expand later into Brazil, Mexico, Japan and other Southeast Asian countries.

“It’s been exciting to watch Konnecto take off,” said Guy Yamen, general partner at TPY Capital, in a written statement. “Synthesizing unexplored consumer data sets and turning them into actionable business insights is needed more now–in the post-COVID world–than ever before, given the increased volume of online activity, as well as the drastic changes in consumers’ preferences and needs. We are excited to take part in this journey.”

Illustration: Dom Guzman

Exclusive: Phood Heats Up $2M Seed to Reduce Food Waste


This post is by Christine Hall from Crunchbase News

Phood Solutions aims to reduce food waste and has a new pile of green to help.

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The New York-based startup, developing a food waste prevention platform, raised its first institutional funding, a $2 million oversubscribed seed round co-led by New Stack Ventures and Story Ventures.

“Phood fits perfectly into our view of how the world is evolving–new forms of data capture that enable insights to modernize manual processes,” Story Ventures Partner Jake Yormak said in a written statement “ We particularly love the combination of innovative data capture with a positive mission.”

Here’s how it works: Phood uses computer vision and artificial intelligence to capture the food that businesses, such as restaurants, are purchasing, preparing and have sitting in refrigerators or on shelves, Luc Dang, Phood’s founder and CEO told Crunchbase News. All of that aggregate data is turned into actionable insights.

“We show the areas where they can make cuts and be more operationally efficient,” he added. “Fighting food waste is our most actionable solution to climate change.”

He plans to put the dollars to work expanding offerings to Phood’s “blue-chip” customer, Whole Foods Market, expanding industry reach, and helping foodservice operations reopen profitably.

Dang founded Phood in 2019 after spending years on a passion project to help spread information on food waste that included speaking around the world on the topic.

He is not alone. The United States wastes approximately 40 percent of the food it produces, and globally, $2.6 trillion annually is lost. Other sustainable food startups addressing this problem are:

While it is too early to talk specifics about growth, Dang said the company is beginning to see a focus on waste as an opportunity and collaboration among startups working toward the same goal.

“We are expanding around our current customer base, as well as helping businesses target reopening,” he added. “We are also expanding our team to ensure the right folks are here to glean customer needs and ensure our value proposition.”

Illustration: Li-Anne Dias

Wish Files For IPO Citing Losses, Revenue Growth Due To COVID-19


This post is by Christine Hall from Crunchbase News

Mobile e-commerce startup Wish filed to go public Friday, capping off a week that has seen some other big brands doing the same, including Roblox, Affirm and Airbnb.

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San Francisco-based Wish joins a list of nearly 650 e-commerce companies that have gone public since 1995, according to Crunchbase data. This list is by no means exhaustive, but reveals that 18 industry IPOs occurred so far in 2020, down from the 38 during all four quarters in 2019. Meanwhile, the largest concentration of IPOs has happened in the past 10 years.

Before Wish makes its public debut, let’s take a look at its funding history and valuation, and dive into its S-1 registration statement, filed under its corporate name, ContextLogic Inc.. The company intends to list its shares on the Nasdaq Global Select Market under the symbol WISH.

What is Wish?

Wish, founded in 2010, offers a mobile digital shopping mall. It’s known for its highly-visual and personalized browsing format. In fact, the company revealed in its S-1 that more than 70 percent of the sales on its platform came from personalized browsing.

The company said it has 100 million monthly active users in over 100 countries and works with more than 500,000 merchants offering about 150 million items. Approximately 1.8 million items are sold per day through the Wish app.

Wish said it was operating in a global mobile commerce market valued at $2.1 trillion in 2019, and that is expected to more than double to $4.5 trillion by 2024. Meanwhile, the global e-commerce market was valued at $3.4 trillion in 2019, and is expected to nearly double to $6.3 trillion by 2024, the company added.

While an e-commerce company might not want to help brick-and-mortar stores, Wish is different. By creating the Wish Local program in 2019 to help those merchants “increase their online reach and discovery, gain foot traffic and drive additional sales,” it now has more than 50,000 partners in 50 countries.

S-1 reveals rising revenue, net losses

Wish revealed in its IPO filing that it is quite cash wealthy, with about $1.1 billion in cash, cash equivalents and marketable securities.

Meanwhile, its revenue grew steadily between 2017 and 2019, going from $1.1 billion to $1.7 billion in 2018 and then $1.9 billion in 2019. That is an increase of 57 percent between 2017 and 2018, but a more modest growth of 10 percent between 2018 and 2019.

In the first nine months of 2019, Wish reported revenue of $1.3 billion, compared with the $1.7 billion reported for the same period in 2020, a 30 percent increase from the year-ago amount.

In addition to revenue gains, the company reported some losses, too. Although the company had managed to whittle its net losses down to $5 million during the first three quarters of 2019, that loss deepened to $176 million for the same period in 2020.

The COVID-19 pandemic increased the use of e-commerce channels as people stayed home and turned to buying online, and either picking up from the store or having items delivered, which seemed to have a positive impact on Wish.

“We benefited from greater mobile usage and less competition from physical retail as a result of shelter-in-place mandates,” Wish said, also noting the pandemic caused initial supply interruptions and delivery delays in places like China.

“… during the initial outbreak of COVID-19, our cross-border logistics function was severely impacted in terms of both disrupted processing capabilities and increased costs, which resulted in a decrease in sales due to higher logistics costs and higher refund rates due to poor performance,” the company said.

Funding history

Wish first raised money in March 2011, with $1.7 million in angel funding. It then went on to raise money nearly each year, with funding topping out between 2015 and 2017, when it brought in three $500 million rounds led individually by DST Global, Temasek and Everbright-IDG Industrial Fund. In total, the company raised $2.1 billion in venture-backed funding, according to Crunchbase data.

After 2017, the company didn’t raise funds until a $300 million Series H round in 2019, led by General Atlantic. That round brought Wish’s valuation to more than $11 billion.

Among Wish’s largest institutional shareholders are: DST Global, Formation8, Founders Fund, GGV Capital, and Republic Technologies, according to the S-1. Peter Szulczewski, Wish’s founder and CEO, will also be winning once shares begin trading. He controls 65 percent of the company’s Class B shares and approximately 58 percent of the total voting power before the IPO, the filing said.

IPO pipeline

Analysts and venture capitalists who spoke with Crunchbase News earlier this month said they expect to see a robust lineup of venture-backed companies going public in the final two months of 2020 and into early 2021. DoorDash last week filed to go public and, as mentioned above, Airbnb, Affirm and Roblox followed suit earlier this week. Poshmark is also expected to file soon.

Illustration: Dom Guzman

Wish Files For IPO Citing Losses, Revenue Growth Due To COVID-19


This post is by Christine Hall from Crunchbase News

Mobile e-commerce startup Wish filed to go public Friday, capping off a week that has seen some other big brands doing the same, including Roblox, Affirm and Airbnb.

Subscribe to the Crunchbase Daily

San Francisco-based Wish joins a list of nearly 650 e-commerce companies that have gone public since 1995, according to Crunchbase data. This list is by no means exhaustive, but reveals that 18 industry IPOs occurred so far in 2020, down from the 38 during all four quarters in 2019. Meanwhile, the largest concentration of IPOs has happened in the past 10 years.

Before Wish makes its public debut, let’s take a look at its funding history and valuation, and dive into its S-1 registration statement, filed under its corporate name, ContextLogic Inc.. The company intends to list its shares on the Nasdaq Global Select Market under the symbol WISH.

What is Wish?

Wish, founded in 2010, offers a mobile digital shopping mall. It’s known for its highly-visual and personalized browsing format. In fact, the company revealed in its S-1 that more than 70 percent of the sales on its platform came from personalized browsing.

The company said it has 100 million monthly active users in over 100 countries and works with more than 500,000 merchants offering about 150 million items. Approximately 1.8 million items are sold per day through the Wish app.

Wish said it was operating in a global mobile commerce market valued at $2.1 trillion in 2019, and that is expected to more than double to $4.5 trillion by 2024. Meanwhile, the global e-commerce market was valued at $3.4 trillion in 2019, and is expected to nearly double to $6.3 trillion by 2024, the company added.

While an e-commerce company might not want to help brick-and-mortar stores, Wish is different. By creating the Wish Local program in 2019 to help those merchants “increase their online reach and discovery, gain foot traffic and drive additional sales,” it now has more than 50,000 partners in 50 countries.

S-1 reveals rising revenue, net losses

Wish revealed in its IPO filing that it is quite cash wealthy, with about $1.1 billion in cash, cash equivalents and marketable securities.

Meanwhile, its revenue grew steadily between 2017 and 2019, going from $1.1 billion to $1.7 billion in 2018 and then $1.9 billion in 2019. That is an increase of 57 percent between 2017 and 2018, but a more modest growth of 10 percent between 2018 and 2019.

In the first nine months of 2019, Wish reported revenue of $1.3 billion, compared with the $1.7 billion reported for the same period in 2020, a 30 percent increase from the year-ago amount.

In addition to revenue gains, the company reported some losses, too. Although the company had managed to whittle its net losses down to $5 million during the first three quarters of 2019, that loss deepened to $176 million for the same period in 2020.

The COVID-19 pandemic increased the use of e-commerce channels as people stayed home and turned to buying online, and either picking up from the store or having items delivered, which seemed to have a positive impact on Wish.

“We benefited from greater mobile usage and less competition from physical retail as a result of shelter-in-place mandates,” Wish said, also noting the pandemic caused initial supply interruptions and delivery delays in places like China.

“… during the initial outbreak of COVID-19, our cross-border logistics function was severely impacted in terms of both disrupted processing capabilities and increased costs, which resulted in a decrease in sales due to higher logistics costs and higher refund rates due to poor performance,” the company said.

Funding history

Wish first raised money in March 2011, with $1.7 million in angel funding. It then went on to raise money nearly each year, with funding topping out between 2015 and 2017, when it brought in three $500 million rounds led individually by DST Global, Temasek and Everbright-IDG Industrial Fund. In total, the company raised $2.1 billion in venture-backed funding, according to Crunchbase data.

After 2017, the company didn’t raise funds until a $300 million Series H round in 2019, led by General Atlantic. That round brought Wish’s valuation to more than $11 billion.

Among Wish’s largest institutional shareholders are: DST Global, Formation8, Founders Fund, GGV Capital, and Republic Technologies, according to the S-1. Peter Szulczewski, Wish’s founder and CEO, will also be winning once shares begin trading. He controls 65 percent of the company’s Class B shares and approximately 58 percent of the total voting power before the IPO, the filing said.

IPO pipeline

Analysts and venture capitalists who spoke with Crunchbase News earlier this month said they expect to see a robust lineup of venture-backed companies going public in the final two months of 2020 and into early 2021. DoorDash last week filed to go public and, as mentioned above, Airbnb, Affirm and Roblox followed suit earlier this week. Poshmark is also expected to file soon.

Illustration: Dom Guzman

The Briefing: Revolution Raising $500M Fund, FireEye Acquires Respond Software, And More


This post is by Crunchbase News from Crunchbase News

The Briefing

Here’s what you need to know today in startup and venture news, updated by the Crunchbase News staff throughout the day to keep you in the know.

Subscribe to the Crunchbase Daily

Revolution seeks $500M for growth fund

Revolution, the Washington, D.C.-based venture capital firm founded by AOL 1co-founder Steve Case, is seeking to raise $500 million for a fourth growth fund, according to a securities filing.

Founded in 2005, the firm is a prolific investor, with 266 investments to date, per Crunchbase data. The firm is also known for its focus on startups located outside of larger coastal tech hubs.

Recent deals include a Series A for ShearShare, a salon space marketplace; Good Buy Gear, a seller of secondhand kids items; and MilkRun, a grocery service.

Revolution has three fund categories, one focused on growth, another on early stage, and its Rise of the Rest funds, which focus on seed-stage deals.

M&A

  • FireEye acquires Respond Software for $186M: Cybersecurity provider FireEye has announced that it is acquiring Respond Software, a provider of tools for investigating and understanding security incidents, for $186 million. Silicon Valley-based Respond previously raised $32 million in known venture funding, per Crunchbase data.

New funds

  • Astanor Ventures raises $325M food tech fund: Brussels-based Astanor Ventures has raised $325 million for a new fund that will invest in European and North American startups in the food, agriculture and ocean tech spaces that are focused on solving systemic challenges across the food system.

Illustration: Dom Guzman


  1. AOL is an investor in Crunchbase. They have no say in our editorial process. For more, head here.

The Briefing: Revolution Raising $500M Fund, FireEye Acquires Respond Software, And More


This post is by Crunchbase News from Crunchbase News

The Briefing

Here’s what you need to know today in startup and venture news, updated by the Crunchbase News staff throughout the day to keep you in the know.

Subscribe to the Crunchbase Daily

Revolution seeks $500M for growth fund

Revolution, the Washington, D.C.-based venture capital firm founded by AOL 1co-founder Steve Case, is seeking to raise $500 million for a fourth growth fund, according to a securities filing.

Founded in 2005, the firm is a prolific investor, with 266 investments to date, per Crunchbase data. The firm is also known for its focus on startups located outside of larger coastal tech hubs.

Recent deals include a Series A for ShearShare, a salon space marketplace; Good Buy Gear, a seller of secondhand kids items; and MilkRun, a grocery service.

Revolution has three fund categories, one focused on growth, another on early stage, and its Rise of the Rest funds, which focus on seed-stage deals.

A16z closes on $4.5B in two funds

Andreessen Horowitz (a16z) is starting the weekend off with a bang. The Menlo Park-based venture capital firm closed on a pair of funds totaling $4.5 billion that brings its total assets under management to nearly $16.5 billion, according to a Friday blog post.

The firm, founded in 2009 by Marc Andreessen and Ben Horowitz, raised $1.3 billion in a Fund VII to invest in early-stage consumer, enterprise and financial services technologies startups. The $3.2 billion Growth II fund will focus on later-stage investments across consumer, enterprise, financial technology, bio and crypto, the firm said.

These follow two other funds the firm closed on this year: a $2.2 billion fund focused on entrepreneurs who have talent and ideas, but lack resources and access, and a $750 million fund earmarked for biotechnology and health care investing.

Robinhood co-CEO steps down ahead of expected IPO

Stock trading app Robinhood said Friday that it’s ditching the dual CEO model it’s employed since its launch in 2013, with co-founder Baiju Bhatt stepping down from the position. Vlad Tenev will be Robinhood’s sole CEO.

Sources told Forbes that the change came about as Robinhood grows and the co-CEO arrangement has become increasingly unwieldy. Robinhood is widely expected to make a run at the public markets before the end of this year or in early 2021.

The change was not the result of strife in the C-suite, the sources said, and the new arrangement will let Bhatt devote more time to projects he most enjoys.” A company spokesperson told Forbes that Bhatt will continue “supporting key business initiatives and serving on Robinhood’s board of directors.”

Robinhood has raised $2.2 billion in venture backing, according to Crunchbase data, and was valued at $11.7 billion as of September after its Series G funding.

Funding rounds

  • Chainalysis gears up to raise $100M at unicorn valuation: Chainalysis, a bitcoin investigation startup, told Forbes that it’s in the process of raising $100 million in new funding at a $1 billion valuation. The Series C funding, expected next week, will be led by Tiger Global Management alumnus Lee Fixel’s newly founded firm, Addition. Previous investors Accel, Benchmark and Ribbit Capital are also reportedly expected to join.
  • Alto Solutions banks $2.8M for IRA product: Alto Solutions, a Nashville-based fintech that enables individuals to use their IRA to invest in alternative investments like startups, private real estate, cryptocurrency and securitized art, raised a $2.8 million venture round. The investment was backed by institutional and individual investors, including Acrew Capital, Alpha Edison and Carta Ventures.
  • Stackline snags $50M: Stackline, a Seattle-based provider of enterprise tools to help retailers and brands manage e-commerce, closed a $50 million Series A investment from Goldman Sachs Growth Equity. The company will use the new proceeds for product innovation and to expand its network of brand and retail partners.
  • Canvas raises $19M: Construction robotics startup Canvas publicly launched Thursday and announced $19 million in funding led by Brick & Mortar Ventures. The company, which was founded in 2017 and is based in San Francisco, uses technology to make drywall finishing more efficient.
  • Factory_OS lands $55M: Proptech company Factory_OS has raised a $55 million Series B led by Lafayette Square and including participation from Autodesk, Citi, Facebook, Morgan Stanley and Google. Factory_OS, which is aiming to create more multifamily housing, plans use the money to speed up growth.
  • Connect Homes closes $5M: Connect Homes has raised $5 million in round led by Brick & Mortar Ventures. The company, which makes modular homes, also announced Greg Leung as its new CEO.

M&A

  • FireEye acquires Respond Software for $186M: Cybersecurity provider FireEye has announced that it is acquiring Respond Software, a provider of tools for investigating and understanding security incidents, for $186 million. Silicon Valley-based Respond previously raised $32 million in known venture funding, per Crunchbase data.

New funds

  • Astanor Ventures raises $325M food tech fund: Brussels-based Astanor Ventures has raised $325 million for a new fund that will invest in European and North American startups in the food, agriculture and ocean tech spaces that are focused on solving systemic challenges across the food system.

Illustration: Dom Guzman


  1. AOL is an investor in Crunchbase. They have no say in our editorial process. For more, head here.

Paceline Pumps Up New Wellness Platform With $5M Seed


This post is by Christine Hall from Crunchbase News

Fintech startup Paceline received a cash infusion of $5 million in seed funding to continue building out its health and wellness platform that rewards physical activity with financial benefits.

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The San Francisco-based company is out to reinvent the financial industry with the aim of making it more technology-enabled and better at engaging with consumers.

“Financial services companies should not just force you to transact, but be there in a way you transact,” CEO Joel Lieginger told Crunchbase News. “Healthy people have a behavioral trait of prioritizing health and wellness, which makes them a better risk over time and a better contributor to society.”

Paceline is building out a full stack platform that will eventually have credit card, banking and insurance products. In fact, Lieginger said the company is building it backwards: building a “freemium” model of a financial services company and giving users rewards for free.

Here’s how it works: The platform tracks physical activity through wearables and also leverages customer spending data–accessed through a linked credit card–to curate rewards. Paceline uses this data to build financial products, starting with a health and wellness credit card and life insurance products, to change the behavioral habits of its members.

“People should be paid for the data they provide,” Lieginger added. “We want you to benefit from your data, and we can make a better world as a result.”

What investors have to say

The seed round was co-led by Montage Ventures and Propel Venture Partners, with participation from Northwestern Mutual and BlackRock’s Mark McCombe as an angel investor. This is the startup’s first institutional funding since the company was founded by Lieginger in 2019.

Funds will be used for product and engineering, as well as to build out the credit card and insurance products that will launch in 2021.

The breadth of investors involved includes a group of what Lieginger called “a unique mix of fintech, insurance and big funds on the future of health and wellness.”

“We are thrilled to be supporting Paceline’s mission to promote healthier lifestyles,” said Jay Reinemann, general partner at Propel Venture Partners, in a written statement. “Physical and financial health are tightly connected for the overall wellbeing of the consumer and at Paceline we have the opportunity to reward healthy consumers, and incentivize less healthy ones, with material financial benefit through financial products that better match their lifestyle.”

Growth

Since coming on the scene with its beta test in January, Paceline has amassed 50 brand partners. At the same time, members have logged more than 1.2 million workouts, which equates to more than 65 million exercise minutes. As a result, they have earned and redeemed more than 70,000 rewards valued at more than $500,000.

Meanwhile, Lieginger expects to double his team over the next 12 months, while also maintaining a lean center by partnering with companies that will provide resources as Paceline scales its product offerings.

The financial services market is valued at $2 trillion, Lieginger said. Paceline aims to make the industry more profitable, and he sees the market eventually becoming a $4 trillion one that would give back $1 trillion to users, which would be good for everyone.

Although Paceline has its roots in financial services, Lieginger sees the company also within the wellness industry. The Global Wellness Institute valued the global wellness economy at $4.5 trillion in 2018, and just the physical activity economy part of the industry is expected to surpass $1.1 trillion by 2023.

“We are creating a new category,” he said. “We are really a fintech company, but creating a community in health and wellness. That is the big trend going forward–embedded financial services–and we are building the biggest one for health and wellness.”

Illustration: Li-Anne Dias

Paceline Pumps Up New Wellness Platform With $5M Seed


This post is by Christine Hall from Crunchbase News

Fintech startup Paceline received a cash infusion of $5 million in seed funding to continue building out its health and wellness platform that rewards physical activity with financial benefits.

Subscribe to the Crunchbase Daily

The San Francisco-based company is out to reinvent the financial industry with the aim of making it more technology-enabled and better at engaging with consumers.

“Financial services companies should not just force you to transact, but be there in a way you transact,” CEO Joel Lieginger told Crunchbase News. “Healthy people have a behavioral trait of prioritizing health and wellness, which makes them a better risk over time and a better contributor to society.”

Paceline is building out a full stack platform that will eventually have credit card, banking and insurance products. In fact, Lieginger said the company is building it backwards: building a “freemium” model of a financial services company and giving users rewards for free.

Here’s how it works: The platform tracks physical activity through wearables and also leverages customer spending data–accessed through a linked credit card–to curate rewards. Paceline uses this data to build financial products, starting with a health and wellness credit card and life insurance products, to change the behavioral habits of its members.

“People should be paid for the data they provide,” Lieginger added. “We want you to benefit from your data, and we can make a better world as a result.”

What investors have to say

The seed round was co-led by Montage Ventures and Propel Venture Partners, with participation from Northwestern Mutual and BlackRock’s Mark McCombe as an angel investor. This is the startup’s first institutional funding since the company was founded by Lieginger in 2019.

Funds will be used for product and engineering, as well as to build out the credit card and insurance products that will launch in 2021.

The breadth of investors involved includes a group of what Lieginger called “a unique mix of fintech, insurance and big funds on the future of health and wellness.”

“We are thrilled to be supporting Paceline’s mission to promote healthier lifestyles,” said Jay Reinemann, general partner at Propel Venture Partners, in a written statement. “Physical and financial health are tightly connected for the overall wellbeing of the consumer and at Paceline we have the opportunity to reward healthy consumers, and incentivize less healthy ones, with material financial benefit through financial products that better match their lifestyle.”

Growth

Since coming on the scene with its beta test in January, Paceline has amassed 50 brand partners. At the same time, members have logged more than 1.2 million workouts, which equates to more than 65 million exercise minutes. As a result, they have earned and redeemed more than 70,000 rewards valued at more than $500,000.

Meanwhile, Lieginger expects to double his team over the next 12 months, while also maintaining a lean center by partnering with companies that will provide resources as Paceline scales its product offerings.

The financial services market is valued at $2 trillion, Lieginger said. Paceline aims to make the industry more profitable, and he sees the market eventually becoming a $4 trillion one that would give back $1 trillion to users, which would be good for everyone.

Although Paceline has its roots in financial services, Lieginger sees the company also within the wellness industry. The Global Wellness Institute valued the global wellness economy at $4.5 trillion in 2018, and just the physical activity economy part of the industry is expected to surpass $1.1 trillion by 2023.

“We are creating a new category,” he said. “We are really a fintech company, but creating a community in health and wellness. That is the big trend going forward–embedded financial services–and we are building the biggest one for health and wellness.”

Illustration: Li-Anne Dias

Strategy Session: Vertex US On Early Stage Investing


This post is by Christine Hall from Crunchbase News

Strategy Session is a feature for Crunchbase News where we ask venture capital firms five questions about their investment strategies.

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Vertex US is taking a unique approach to early-stage investments by investing early and often first.

The firm intentionally makes a select number of investments each year to be true partners to startups from Day One to 100 and beyond.

The Palo Alto-based firm is now investing from its second fund, the $150 million Vertex US Fund II, in enterprise tech investments. Upsolver’s $13.3 million Series A was the company’s first lead funding amid the global pandemic. Upsolver manages, integrates and structures streaming data for analysis at unprecedented ease.

We spoke with Vertex’s General Partner Jonathan Heiliger and Partner Sandeep Bhadra about the firm’s friendly approach to investing.

Your approach to early-stage investments is unique–investing early and often first. How did you settle on that thesis?

Heiliger: Before starting Vertex, we collectively had made more than 40 angel investments. We enjoy seeing, picking, winning and working with companies. In our former roles, we thought focus was an important ingredient. On our website, you don’t see the word “focus,” but you do see “no bullshit.” Early on, Sandeep said make a few investments and make them count.

How do you like to work with founders?

Heiliger: Our approach to investing is that while everyone touts being founder-friendly or been a founder before, in our case, our three partners were actually founders. We think that not only sets us apart from other investors by virtue of us being founders, we also have empathy. We end up being a couch for them to talk. You have to stretch your perception of what is possible and take the leap with the founder. Being able to respond quickly and interactively is important.

Bhadra: It’s also how we operate and use our time. Time is a constraint for any investor, and our portfolio is concentrated. We might do seven or eight Series A and seven or eight seed investments. We start bigger and expect to have some not make it to next term. Each of us takes up one to two new projects each year. We don’t treat investments as call options. Even in seed investments, we spend time with founders and do it with intention.

Among the enterprise tech investments you are looking at right now, what area or sector is attractive to you?

Bhadra: We are still in the early innings of moving to the cloud, the adoption of enterprise software, and formalization of work through software. IT was a department that would keep blinking machines working inside the broom closet. Then the cloud happened, and five years ago we all thought super artificial intelligence was going to take our jobs. However, there is a happy medium that software will work as a handmaid to humans. There is a symbiotic relationship. You can see acceleration through the pandemic that brought forward a digitalization strategy. We are now in a weird place where the market has come to us. We are fortunate to live through a time where work is being transformed through technology.

Heiliger: It’s the move to development and operations. To enterprises, this is new, interesting or novel, but they don’t have the bandwidth to build them, so they have to buy it. Just as businesses outsourced to places like AWS, this is another level, like doing it through tokenization. That is a trend we are betting on as the line of infrastructure goes from raw to a higher and higher level of things.

You are now working on your second fund. What lessons did you learn from your first fund that you are applying here?

Heiliger: Lots. It is worth repeating that we believed in the founder vision early on. We catch ourselves all the time. We get in the weeds all the time, and need to think where the company will be in three to five years and dream that dream. You also have to consider how to remain curious, especially now that there are no serendipitous conversations in the office. Now you have to be creative with the tools, be adaptive and continue to dig. During the first fund, we spent a lot of time putting our shingle out in the world, so deal flow was slow, and in fund two, we hit it hard and fast. The second fund closed in February 2019, and we made nine investments that year because we were primed and ready.

Vertex has seen several companies exit. While it’s difficult to pick a favorite, is there one that you were most excited to see exit?

Heiliger: SpaceIQ’s exit to WeWork (acquisition in 2019). We incubated with the founder, helped create the idea and set up interviews to validate. The idea is doing seed planning for offices used to be Post-its on a blueprint. They modernized it to become something you could drag and drop. What was going on under the hood was more advanced. Various teams grow and shrink at different rates, so you need to adjust planning, and they built this business, and it started going well. WeWork approached them to combine, and it was in the press pretty heavily. We literally closed the acquisition a week prior to the whole thing unraveling. We had coffee recently with the founders. It was kind of sad, because it went from a great marriage to not.

Illustration: Dom Guzman

Strategy Session: Vertex US On Early-Stage Investing


This post is by Christine Hall from Crunchbase News

Strategy Session is a feature for Crunchbase News where we ask venture capital firms five questions about their investment strategies.

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Vertex US is taking a unique approach to early-stage investments by investing early and often first.

The firm intentionally makes a select number of investments each year to be true partners to startups from Day One to 100 and beyond.

The Palo Alto-based firm is now investing from its second fund, the $150 million Vertex US Fund II, in enterprise tech investments. Upsolver’s $13.3 million Series A was the company’s first lead funding amid the global pandemic. Upsolver manages, integrates and structures streaming data for analysis at unprecedented ease.

We spoke with Vertex’s General Partner Jonathan Heiliger and Partner Sandeep Bhadra about the firm’s friendly approach to investing.

Your approach to early-stage investments is unique–investing early and often first. How did you settle on that thesis?

Heiliger: Before starting Vertex, we collectively had made more than 40 angel investments. We enjoy seeing, picking, winning and working with companies. In our former roles, we thought focus was an important ingredient. On our website, you don’t see the word “focus,” but you do see “no bullshit.” Early on, Sandeep said make a few investments and make them count.

How do you like to work with founders?

Heiliger: Our approach to investing is that while everyone touts being founder-friendly or been a founder before, in our case, our three partners were actually founders. We think that not only sets us apart from other investors by virtue of us being founders, we also have empathy. We end up being a couch for them to talk. You have to stretch your perception of what is possible and take the leap with the founder. Being able to respond quickly and interactively is important.

Bhadra: It’s also how we operate and use our time. Time is a constraint for any investor, and our portfolio is concentrated. We might do seven or eight Series A and seven or eight seed investments. We start bigger and expect to have some not make it to next term. Each of us takes up one to two new projects each year. We don’t treat investments as call options. Even in seed investments, we spend time with founders and do it with intention.

Among the enterprise tech investments you are looking at right now, what area or sector is attractive to you?

Bhadra: We are still in the early innings of moving to the cloud, the adoption of enterprise software, and formalization of work through software. IT was a department that would keep blinking machines working inside the broom closet. Then the cloud happened, and five years ago we all thought super artificial intelligence was going to take our jobs. However, there is a happy medium that software will work as a handmaid to humans. There is a symbiotic relationship. You can see acceleration through the pandemic that brought forward a digitalization strategy. We are now in a weird place where the market has come to us. We are fortunate to live through a time where work is being transformed through technology.

Heiliger: It’s the move to development and operations. To enterprises, this is new, interesting or novel, but they don’t have the bandwidth to build them, so they have to buy it. Just as businesses outsourced to places like AWS, this is another level, like doing it through tokenization. That is a trend we are betting on as the line of infrastructure goes from raw to a higher and higher level of things.

You are now working on your second fund. What lessons did you learn from your first fund that you are applying here?

Heiliger: Lots. It is worth repeating that we believed in the founder vision early on. We catch ourselves all the time. We get in the weeds all the time, and need to think where the company will be in three to five years and dream that dream. You also have to consider how to remain curious, especially now that there are no serendipitous conversations in the office. Now you have to be creative with the tools, be adaptive and continue to dig. During the first fund, we spent a lot of time putting our shingle out in the world, so deal flow was slow, and in fund two, we hit it hard and fast. The second fund closed in February 2019, and we made nine investments that year because we were primed and ready.

Vertex has seen several companies exit. While it’s difficult to pick a favorite, is there one that you were most excited to see exit?

Heiliger: SpaceIQ’s exit to WeWork (acquisition in 2019). We incubated with the founder, helped create the idea and set up interviews to validate. The idea is doing seed planning for offices used to be Post-its on a blueprint. They modernized it to become something you could drag and drop. What was going on under the hood was more advanced. Various teams grow and shrink at different rates, so you need to adjust planning, and they built this business, and it started going well. WeWork approached them to combine, and it was in the press pretty heavily. We literally closed the acquisition a week prior to the whole thing unraveling. We had coffee recently with the founders. It was kind of sad, because it went from a great marriage to not.

Illustration: Dom Guzman

Roblox Is Expected To File For An IPO Soon. Here’s Who Its Biggest Investors Are


This post is by Sophia Kunthara from Crunchbase News

Online game platform Roblox will reportedly file to go public this week, as more startups hurry to file their S-1 registration statements in time to go public before the end of the year.

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Airbnb and Affirm this week filed to go public. Wish is also expected to do so this week, according to CNBC

If Roblox files for its IPO this year, it will follow Unity Technologies, another gaming company, to the public markets. Unity, which makes video game software, went public in September. Its stock has since risen around 70 percent.

Before Roblox makes its public debut, let’s take a look at its funding history and valuation.

What is Roblox?

Roblox is a platform where users can create their own games and play games made by others. It’s popular in the world of gaming, especially among younger users (the company says it’s safe for users age 4 and older). 

The company recently made headlines for hosting its first virtual concert featuring a star born out of another app popular among kids and teens: Lil Nas X, who first found fame on video sharing app TikTok

Roblox was founded in 2004 and is based in San Mateo, California. The company says 37 billion hours have been played on its platform since 2008 and it logs approximately 3 billion total engagement hours each month. About $241 million dollars have been paid to community developers on its platform, per Roblox. 

Funding history

Roblox first raised money in January 2005, with a $560,000 Series A. It raised funding steadily in the following years, landing a $1.1 million Series B in August 2006, a $2.9 million Series C in January 2008, a $2.2 million Series D in July 2009, and another $4 million in May 2011, according to Crunchbase data.

Roblox then didn’t raise money for several years, picking back up with a $25 million Series E in January 2017 led by Index Ventures and Meritech Capital Partners. The company didn’t start raising supergiant rounds (what we refer to as rounds larger than $100 million) until July 2018, with its $150 million Series F led by Greylock Partners and Tiger Global Management

Most recently, the company raised a $150 million Series G led by Andreessen Horowitz in February. The Series G brought Roblox’s valuation to more $4 billion, per Crunchbase data.

What’s Next

While we won’t know Roblox’s financial details until the S-1 is filed, we do know that the company, at least back in February when it raised its Series G, was cash flow positive

Of course, the COVID-19 pandemic has taken hold since then, but with streaming, connected fitness and other stay-at-home activities seeing increased demand, Roblox’s business has likely benefited from more people staying home for the past eight months.

Roblox is set to be among a number of highly valued tech companies to go public in December. DoorDash, Airbnb and Affirm, have all publicly filed their S-1s at this point, and there are some other companies, such as Poshmark, that could file or make their confidential filings public soon too.

Analysts and venture capitalists who spoke with Crunchbase News earlier this month said they expect to see a robust lineup of venture-backed companies going public in the final two months of 2020 and into early 2021.

Image courtesy of Roblox

Roblox Had ‘Rapid’ Revenue Growth Due to COVID-19, Its IPO Filing Reveals, But Growing Losses Too


This post is by Sophia Kunthara from Crunchbase News

Online game platform Roblox filed to go public on Thursday, revealing explosive revenue growth but increasing losses as the COVID-19 pandemic boosted its business. 

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The San Mateo-based startup will follow Unity Technologies, another gaming company, in hitting the public markets this year. Unity, which makes video game software, went public in September. Its stock has since risen around 70 percent.

Before Roblox makes its public debut, let’s take a look at its funding history and valuation, and dive into its S-1 registration statement to go public.

What is Roblox?

Roblox is a platform where users can create their own games and play games made by others. It’s popular in the world of gaming, especially among younger users. In fact, Roblox said in its S-1 that 25 percent of its users are under the age of 9, and 29 percent are between the ages of 9 and 12. 

The company recently made headlines for hosting its first virtual concert featuring a star born out of another app popular among kids and teens: Lil Nas X, who first found fame on video-sharing app TikTok

Roblox was founded in 2004. The company says on its website that 37 billion hours have been played on its platform since 2008 and it logs about 3 billion total engagement hours each month. About $241 million have been paid to community developers on its platform, per the website. 

The company has about 31.1 million daily active users, according to the S-1.

S-1 reveals rising revenue, losses

Roblox reported more than $488 million in revenue for the year that ended on Dec. 21, 2019, up 56 percent from around $312.8 million in revenue it generated during the same period in the year prior. 

More recently, the company reported $588.7 million in revenue for the first nine months of 2020, up 68 percent from $349.9 million during the same period last year. 

The COVID-19 pandemic has evidently boosted Roblox’s numbers, as people have stayed home and turned to streaming, gaming and other forms of home entertainment.

“We have experienced rapid growth in the three months ended June 30, 2020, September 30, 2020 and for a portion of the three months ended March 31, 2020, due in part to the COVID-19 pandemic given our users have been online more as a result of global COVID-19 shelter-in-place policies,” Roblox wrote. 

Bookings increased 171 percent between the nine months ended Sept. 30, 2019 and the same period this year, the company said. 

Still, the company does “not expect these activity levels to be sustained, and in future periods we expect growth rates for our revenue to decline, and we may not experience any growth in bookings or our user base during periods where we are comparing against COVID-19 impacted periods (i.e. the three months ended March 31, 2020, June 30, 2020, and September 30, 2020).”

That explosive growth appears to have caused losses to go up as well. Roblox’s consolidated net losses decreased from around $97.2 million in 2018 to around $86.1 million in 2019. But its consolidated net losses then grew again in the first nine months of 2020, from $46.3 million in the same period the year prior to $205.9 million. 

So it looks like while Roblox was getting its losses under control pre-COVID, those losses accelerated with the pandemic: Losses from operations increased more than 344 percent between the first nine months of last year and the same period in 2020.

Funding history

Roblox first raised money in January 2005, with a $560,000 Series A. It raised funding steadily in the following years, landing a $1.1 million Series B in August 2006, a $2.9 million Series C in January 2008, a $2.2 million Series D in July 2009, and another $4 million in May 2011, according to Crunchbase data.

Roblox then didn’t raise money for several years, picking back up with a $25 million Series E in January 2017 led by Index Ventures and Meritech Capital Partners. The company didn’t start raising supergiant rounds (what we refer to as rounds larger than $100 million) until July 2018, with its $150 million Series F led by Greylock Partners and Tiger Global Management

Most recently, the company raised a $150 million Series G led by Andreessen Horowitz in February. The Series G brought Roblox’s valuation to more $4 billion, per Crunchbase data.

Among the largest shareholders of Roblox are Altos Ventures, First Round Capital, Index Ventures, Meritech Capital Partners and Tiger Global Management, according to the S-1.

IPO pipeline

Analysts and venture capitalists who spoke with Crunchbase News earlier this month said they expect to see a robust lineup of venture-backed companies going public in the final two months of 2020 and into early 2021. DoorDash last week filed to go public. Airbnb and Affirm followed suit earlier this week. Poshmark is also expected to file soon and Wish could drop its S-1 before the weekend

Image courtesy of Roblox

The Briefing: SellerX Raises $118M, ZenBusiness Lands $55M, And More


This post is by Crunchbase News from Crunchbase News

The Briefing

Here’s what you need to know today in startup and venture news, updated by the Crunchbase News staff throughout the day to keep you in the know.

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SellerX raises $118 to grow Amazon businesses

Berlin-based SellerX, a new startup that aims to consolidate and grow promising smaller businesses that sell via Amazon’s platform, has raised $118 million in what is reportedly being called a seed funding round.

Cherry Ventures, Felix Capital and TriplePoint Capital led the financing, which the company reportedly plans to use to roll up smaller businesses using Fullfilment by Amazon for payments, logistics and delivery.

SellerX’s focus will be consumer goods, covering categories including household, pets, garden supplies, goods for kids, and beauty.

Funding rounds

  • ZenBusiness lands $55M: Austin-based ZenBusiness, provider of an online platform for starting a business, raised $55 million in a Series B round led by Cathay Innovation.
  • Apprentice.io raises $24M for pharma innovation:  Apprentice.io has announced the close of a $24 million Series B round led by Insight Partners. The Jersey City, New Jersey-based company develops an intelligent manufacturing execution system that helps life science teams scale faster, with applications in COVID-19 therapies and other areas.

Illustration: Dom Guzman

FirstVet Is All Paws In For American Expansion Following $35M Financing Round


This post is by Christine Hall from Crunchbase News

The adoption of telemedicine services for humans during the global pandemic has also trickled down to our four-legged friends.

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Swedish startup FirstVet is expanding its on-demand video consultation platform in the United States after securing a $35 million financing round.

Mubadala Capital led the round with participation from Cathay Innovation, as well as existing backers, OMERS Ventures 1 and Creandum. Since its inception in 2016, FirstVet has raised a total of $65 million in funding, including an approximately $22 million Series B round in 2019, according to Crunchbase data.

Using some of the new round, FirstVet established a U.S. presence with 14 staff members in New York to care for the 184 million cats and dogs there, David Prien, FirstVet co-founder and CEO told Crunchbase News. It offers its video-based vet consultation service in all 50 states, including 24/7 expert advice and diagnoses for a variety of different animals, ranging from cats and dogs to horses and reptiles.

Prien, who has been involved in the veterinary and pet space for the past 12 years, started out by providing a content-driven website for pet stores.

“That worked tremendously well and became popular, though it never converted to e-commerce as we had hoped,” he said. “We created similar content for FirstVet, but we have full-time vets hired to answer the questions that are coming in.”

He sees virtual veterinary visits as a “super nascent field” in Europe to address the 20 percent year-over-year increase in average price of vet visits. It also increased the insurance penetration. People who had insurance for their pets were taking them to the vet all the time, but those who didn’t were reluctant to seek vet care because of the cost, he added.

Testing that format led to FirstVet, which Prien describes as a mix of triage and telemedicine, a space that has gained investor attention recently. The Crunchbase database shows that in the past two years, just over 100 startups working in the veterinary space have received more than $2.6 billion in funding.

Investments in the past few months, according to our database, include:

In the last 12 months, the company’s revenue grew approximately 2.5 times, Prien said. In addition, its workforce has grown to 60 employees in addition to its approximately 250 staff veterinarians.

Meanwhile, FirstVet operates within six markets, including the Nordics, Germany and the

United Kingdom, partnering with more than 40 insurance companies across Europe. Next year, it will launch in Canada and France.

“After this round, the stars really aligned and we have been able to bring on partners with deep market knowledge and exposure,” Prien said. “The rush now is having the right partners and the right positioning given where we stand.”

Photo of David Prien and Per Victor courtesy of FirstVet.
Blogroll illustration: Dom Guzman


  1. OMERS Ventures is an investor in Crunchbase. They have no say in our editorial process. For more, head here.

Zapata Computing Raises $31M As Quantum Computing Nears


This post is by Chris Metinko from Crunchbase News

Boston-based quantum computing software-maker Zapata Computing closed a $31 million Series B as the promise of the next generation of computing gets closer.

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The new round was led by Comcast Ventures, Pitango and Prelude Ventures, with the support of existing investors BASF Venture Capital, Robert Bosch Venture Capital and The Engine Accelerator Fund, as well as new investors, including Ahren Innovation Capital, Alumni Ventures Group, Honeywell Venture Capital, ITOCHU Corp. and Merck Global Health Innovation Fund.

While the full potential of quantum computing has yet to be realized, Zapata founder and CEO Christopher Savoie said it is only a matter of time before the new computing method–based on the principles of quantum theory and explains the behavior of energy and material on an atomic or subatomic level–is used in fields such as energy, supply chain optimization and any industry using chemistry.

Zapata’s software attempts to allow users to take advantage of advancements in near-term quantum computing, Savoie said. The platform allows enterprises to improve data and compute workflows on current high-performance computers with the capability to eventually move to commercial quantum computing, he added.

“We’ve looked at both software and hardware players in quantum computing,” said Prem Tumkosit, managing director of the Merck Global Health Innovation Fund. “But Zapata can provide near-term and long-term return.”

Zapata started working with customers in 2018 and has several “seven-figure engagements” with companies, Savoie said. The company also is partnering with hardware providers, including IBM, Honeywell and College Park, Maryland-based IonQ to accelerate the adoption of quantum computing.

The company will use its new cash for more research and development on the platform, meeting increased customer demand, and adding to its staff of more than 50 employees, he added.

Quantum computing startups have been attractive to investors this year. In April, it was reported Palo Alto, California-based PsiQuantum had raised $215 million. In June, IonQ announced it had raised a Series B round, bringing the company’s total amount raised to $84 million.

“Quantum computing’s time is happening,” Savoie said.

Zapata has raised more than $64 million since being founded in 2017.

Illustration: Li-Anne Dias.

Accel’s Philippe Botteri: How Cloud Computing In Europe Is Coming Into Its Own


This post is by Gené Teare from Crunchbase News

In 2020 the global market has seen a significant increase in valuations to private and public cloud companies. Philippe Botteri, a longtime partner at Accel in London who invests in cloud applications and security companies, charts this expansion for European companies in Accel’s  2020 Euroscape report.

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“The entire amount invested in private cloud companies in Europe and Israel in 2020 has grown close to 30% so far to $9-9.5 billion, which is nearly half the $20 billion invested in US-born cloud companies,” said Botteri in the latest report on European cloud companies.

Botteri attributes this growth to Europe’s leadership in artificial intelligence in math, science and data, along with the increase in the number of ecosystems across Europe that are attracting startups, which in turn impact one another.

Accel’s London office earlier this year celebrated its 20th anniversary and the firm has been front and center through Europe’s rise as a startup hub.

Key findings

  • Two European software companies were valued at more than $10 billion in July this year.
    • UiPath, now headquartered in New York, was valued over $10 billion.
    • Norway’s Visma was acquired with a total valuation above $12 billion.
  • There are 100 companies to watch on Accels Euroscape cloud list, with 19 championship companies, up from 13 a year ago.
  • A public index of 10 cloud companies founded in Europe and Israel is worth over $100 billion.
Click Here To See List

From consumer to cloud

Botteri built a cloud-investing profile in the early days of cloud at Bessemer Venture Partners in the U.S. When he moved to Accel, London in 2011, there was very little happening in software at the time.

For the first three years in Europe, Botteri’s investments were in marketplace companies like BlaBlaCar and Fiverr—more internet than software–Botteri told Crunchbase News. His first software investments were in PeopleDoc in 2014, and then Algolia and Doctolib.

“Europe had created some leading consumer companies like Spotify and Deliveroo from 2010 to 2015, and then moved into the era of software from 2016 to 2020,” said Botteri.

Accel’s investments mirror this progress. Between 2011 and 2015, Accel made 14 software investments in seven cities, and from 2016 to 2020, 35 investments in 20 cities. The investment amount rose from $150 million to $740 million when comparing these two time periods.

This rise in European cloud companies follows through in global revenue predictions. According to the report, the global cloud applications market has increased to $100 billion in 2020 and is estimated to grow to $1 trillion by 2025.

European ecosystems

Botteri said that Europe was already very connected, and is now even more international due to the rise in remote work sparked by the COVID-19 pandemic. Europe’s time zones make it easier for people to hire in neighboring countries.

“There is a lot more mobility between these hubs than people think,” Botteri said. “You’ll see a company in Paris with engineers from Portugal, from Spain, from the U.K., even from the U.S.”

Many global software companies founded in Europe and Israel create U.S. headquarters while retaining R&D in Europe. “For every dollar spent globally on software, 50 cents are spent in the U.S. You can’t be a global software company and not have significant market share in the U.S.,” he said.

For Botteri, it really depends on the sector and the market being addressed on whether to have a U.S. headquarters or not. The Accel Euroscape Champions League includes 19 companies—all listed on the Crunchbase Unicorn Board—collectively valued at $48.4 billion. Of these companies, 10 are headquartered in the U.S.

Click Here To See List

The most highly valued companies, which were all founded in Europe and Israel, include New York-headquartered robotic process automation company UiPath valued at $10.2 billion, London-based online payment solution Checkout.com at $5.5 billion, and customer cloud communications company MessageBird based in Amsterdam and customer-engagement platform Talkdesk headquartered in San Francisco, each valued at $3 billion.

Security company Snyk, based in London, raised its Series A in March 2018 and reached a unicorn valuation at its Series C within two years. And live virtual-events platform Hopin, also based in London, which raised a Series A earlier this year, was most recently valued at $2.1 billion in November.

Just a year ago, the 2019 Champions league of 13 companies were valued collectively at $19.5 billion. Now, the new Champions league list of 19 companies for 2020 are valued at $48.4 billion, more than double the valuation of the 2019 list.

Predicting Patient Outcomes: ClosedLoop.ai Secures $11M Series A For Health Models


This post is by Christine Hall from Crunchbase News

Even before a patient walks into the doctor’s office, ClosedLoop.ai aims to predict whether that patient may be admitted to the hospital soon or is likely to cancel an appointment.

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The Austin-based company is using a new $11 million Series A cash infusion to continue developing its health care data science platform that uses artificial intelligence, machine learning and automation to enable data scientists to build and deploy predictive models.

“We consider ‘who is most likely to X,’ for example, admitted to the hospital, develop a chronic disease or be a no-show for an appointment,” ClosedLoop co-founder and CEO Andrew Eye told Crunchbase News. Eye and Dave DeCaprio founded the company in 2017.

The Series A was co-led by Greycroft and .406 Ventures with participation from Silicon Valley Bank and Meridian Street Capital. Including the new round, ClosedLoop has raised a total of $15 million, which includes a $3 million seed round in 2018, according to Crunchbase data.

The company intends to invest the funds in product and engineering, as well as sales and marketing. Eye said the company has attracted recent attention after being rated a “top performer in health care-focused AI” on the KLAS Healthcare AI 2020 report, as well as being named one of seven finalists in the Centers for Medicare & Medicaid ServicesArtificial Intelligence Health Outcomes Challenge.

“With all of this recognition, the timing for the new investment is good,” Eye added.

Predicting behavior

It’s well known that 5 percent of Americans account for 50 percent of the country’s health care costs. If doctors are able to identify the 5 percent of at-risk patients within their practices, they can intervene with them directly, Eye said.

“If you can find those people, and do something like a home visit, you have a bigger opportunity to impact negative health outcomes and cost impact,” he added.

ClosedLoop’s content library provides more than 2,000 health care features, including medication adherence, frailty and co-morbidities so that predictive and prescriptive models for common health care use cases can be built.

The company is disrupting the traditional model of health care, which involves fee-based care. Instead, value-based care is becoming the new way, and providers have a financial incentive to take care of a patient prior to them coming in, Eye said.

Using insurance claims, doctors can see health history to spot potential chronic diseases and other challenges, but social determinant information helps doctors see if someone has access to fresh food, live in a walkable area or may need transportation or referrals.

“You could identify people overutilizing the emergency department and give them a free Uber ride to follow-up visits,” Eye said. “It’s unlikely you can do that for everyone, but you could do it for people most likely to have these problems. You could also predict things like falls, and help the patient put a step stool next to the bed. It’s a $50 action versus repairing a broken hip.”

What’s next

Although Eye would not disclose revenue figures, he said ClosedLoop’s growth is a result of working within four market buckets: providers, payers, pharma and health IT. Health care spending was 17.7 percent of the nation’s Gross Domestic Product in 2018, according to the CMS.

Eye said that is more like 25 percent today, with $1 out of every $4 spent on health care.

“The industry is behind in using artificial intelligence to look at electronic health records and claims to see what is wrong with you and predict future health events,” he added. “By providing an end-to-end platform purpose-built for health care and the industry’s largest catalog of prebuilt models and features, we allow customers to go from raw, messy health care data to production-ready predictive models in as little as 24 hours.”

Illustration: Dom Guzman

Medable Locks In $91M Series C To Digitize Clinical Trials


This post is by Christine Hall from Crunchbase News

Clinical trials research company Medable secured $91 million in Series C funding to continue efforts to revamp the way clinical trials are performed. This is the second investment this year for the company, which raised a $25 million round in May.

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Sapphire Ventures led the new round of funding and was joined by existing investors GSR Ventures, PPD and Streamlined Ventures. The funding brings Medable’s total capital raised to more than $136 million since the company’s inception in 2015.

Palo Alto-based Medable aims to reduce clinical trial timelines by 50 percent through its decentralized trial platform by streamlining design, recruitment, retention and the collection of data. Siloed systems are replaced with integrated digital tools, data and interfaces to accelerate trial execution. In addition, Medable connects patients, sites and clinical trial teams to improve patient access, experience and outcomes.

The company grew revenue by more than 500 percent in 2020 as a shift occurred toward decentralizing clinical trials, Medable co-founder and CEO Michelle Longmire, M.D., told Crunchbase News.

“We are looking at capturing high-quality data through connected devices, as well as providing a seamless user experience,” she added. “The world is gravitating toward digital health, and while Medable was early to the party with digital connections, we are now seeing a larger appetite for it, which is driving adoption.”

The new funding comes on the heels of new application launches, including TeleVisit, TeleConsent and TeleCOA that connect patients virtually with sites and sponsors so they can get medical advice, capture informed consent and re-consent, and share clinical outcome assessments.

Back in May, Longmire estimated that 70 clinical trials were related to COVID-19, and that number has essentially quadrupled, she said. It is one of the areas where the new funds will be useful to meet that demand, she said. In general, Medable customers reported three times faster enrollment and 90 percent retention rates.

Now that the company has gone through this acceleration, Longmire expects to see both patient and clinician preferences in relation to clinical trials whenever the world becomes post-COVID. In addition, clinical trial teams are becoming more comfortable with the technology and where it ultimately fits in, and will have more experience on the backside, including where to use the technology when designing future trials, she added.

“This is a big milestone for the company,” Longmire said. “This technology and any new technology will shorten the timeline for clinical trials, and to be in this position is really exciting.”

Meanwhile, as part of the investment, David Hartwig, managing director at Sapphire Ventures, is joining Medable’s board.

“We’re all aware of the challenges with clinical trials, and it’s a problem we’re excited to help solve,” Hartwig said in a written statement. “Medable is doing groundbreaking work, and we’re excited to partner with Michelle and team as they revolutionize how care is being delivered by digitizing the clinical trial process.”

Illustration: Li-Anne Dias