04 Sep

Elliptic banks $23M to shrink crypto risk, eyeing growth in Asia

Crypto means risk. To UK company Elliptic it also means business. The startup has just closed a $23M Series B to step up growth for a crypto risk-management play that involves selling tech and services to help others navigate the choppy darks of cryptocurrencies.

The round was led by financial services and asset management firm SBI Group, a Tokyo-based erstwhile subsidiary of SoftBank . Also joining as a new investor this round is London-based AlbionVC. Existing investors including SignalFire, Octopus Ventures and Santander Innoventures also participated. SBI Group’s Tomoyuki Nii and Ed Lascelles of AlbionVC are also joining Elliptic’s board.

Flush with a sizeable injection of Series B capital, Elliptic is especially targeting business growth at Asia — with a plan to open new offices in Japan and Singapore. It says client revenues in the region have risen 11x over the past two years.

We last spoke to Elliptic back in 2016 when it had just raised a $5M Series A.

The 2013-founded startup began by testing the crypto waters with a storage product before zeroing in on financial compliance as a pain-point worth its time. It went on to develop machine learning tech that screens transactions to identify suspicious patterns and, via them, dubious transactors.

Now it offers an integrated suite of products and services for financial institutions and crypto businesses to screen volumes of crypto-flows that sum to billions of dollars in transactions per day — analyzing them for links to illicit activity such as money laundering, terrorist financing, sanctions evasion, and other financial crimes.

It’s focused on selling anti-money laundering compliance, crypto forensics and cryptocurrency investigation services to the private sector — though has also sold tools direct to law enforcement agencies in the past.

Billions of dollars in financial services terms is of course just a tiny drop in a massive ocean of money movements. And growth in the crypto risk-management space has clearly required more than a little patience, from a startup perspective.

Three years ago Elliptic’s first blockchain analytics product had 10-20 Bitcoin companies as customers. That’s now up to 100+ crypto businesses and financial institutions using its products to shrink their risk of financial crime when dealing with crypto-assets. But the more three than year gap between Elliptic’s Series A and B is notable.

“To date, we’ve focused on product development and assembling the right team as the market has matured. This new funding will help us expand in the right way, namely by making the push into Asia without diluting our focus on the US and EMEA,” says co-founder and CEO James Smith when asked about the gap between financing rounds.

He declines to comment on how far off Elliptic is from achieving breakeven or profitability yet.

“We provide best-in-class transaction monitoring products for crypto-assets, which are trusted by crypto exchanges and financial institutions worldwide,” he adds of its product suite. “Our products are used as key components of larger compliance processes that are designed to minimise money laundering risks.”

With the addition of SBI Group to its investor roster Elliptic gains a strategic partner in Asia to help push what it dubs “bank-grade risk data” at a new wave of established financial institutions it believes are eyeing crypto with growing appetite for risk as larger players wade in.

Larger players like Facebook . Elliptic’s PR name-drops the likes of Facebook’s Libra cryptocurrency, Line Corporation’s LINK and central bank digital currencies, as markers of a rise in mainstream attention on crypto assets. And it says Series B funds will be used to accelerate product development to support “an emerging class of asset-backed crypto-assets”.

Regulatory attention on crypto — which has been rising globally for years but looks set to zip up several gears now that Facebook has ripped the curtain off of an ambitious global digital currency plan which also has buy-in from a number of other household tech and fintech names — is another claimed feed in for Elliptic’s business. More crypto implies growing risk.

It also points to the intergovernmental Financial Action Task Force’s global regulatory framework for crypto-assets as an example of some of the wider risk-based requirements and now wrapped around those dealing in crypto.

The focus on Asia for business expansion is a measure of relative maturity of interest in opportunities around crypto-assets and localized attention to regulation, according to Smith.

“Revenue growth is certainly very strong in this region. We have been working with customers in Asia for a number of years and have seen first-hand how vibrant their crypto-asset ecosystems are. Countries such as Singapore and Japan have developed clear crypto-asset regulatory frameworks, and businesses based in these countries are serious about meeting their compliance obligations,” he says.

“We have also found that traditional financial institutions in Asia are particularly keen to engage with crypto-assets, and we will be working with them as they take their first steps into this new asset class.”

“We believe that crypto-assets will play an increasingly important role in our everyday lives and are shaping the future of banking. Our investment in Elliptic is a further commitment to this belief and to SBI Holding’s appetite to help build the digital asset-related ecosystem,” adds Yoshitaka Kitao, CEO of the SBI Group, in a supporting statement.

“Elliptic’s pioneering approach is enabling the transparency, integrity, and trust necessary for this vision to become reality. We are seeing a growing demand for their services across our portfolio of crypto-assets related companies and view Elliptic as best-placed to meet this considerable opportunity.”

While Elliptic’s business is focused on reducing the risk for other businesses of inadvertently transacting with criminals using crypto to launder money or otherwise shift assets under the legal radar, the proportion of transactions that such illicit activity represents in the Bitcoin space represents a tiny fraction of overall transactions.

“According to our analysis, approximately $1BN in Bitcoin has been spent on the dark web, so far in 2019, on items ranging from narcotics to stolen credit cards. This represents a very small share of all Bitcoin activity — less than 0.5% of Bitcoin payments over this period,” says Smith.

Not that that diminishes the regulatory risk. Nor, therefore, the business opportunity for Elliptic to sell support services to help others avoid touching the hot stuff.

“Crypto money launderers are continually developing new techniques to cover their tracks — from the use of mixers to transacting in privacy coins such as monero,” Smith adds. “We are also constantly innovating to keep pace with this and help our clients to detect money laundering. For example our work with researchers from MIT and IBM demonstrated the application of deep learning techniques to the identification of illicit crypto-asset transactions.”


Source: TechCrunch – Funding and Exits

04 Sep

Loog launches a trio of new educational guitars

Educational guitar maker Loog returned to Kickstarter this week, some eight years after it first hitting the crowdfunding site. This fourth campaign from the company features a trio of instruments aimed at helping accelerating the learning process.

There are three models, each aimed at a different age group: the Loog Mini (ages 3+), Loog Pro (ages 8+) and Loog Pro VI (ages 12+). The latter of which is the company’s first guitar to sport the standard six strings (versus the three it usually offers).

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All have a built-n speaker and amp, reducing the need for additional accessories for a kid’s first instrument. They’re also designed to work with the company’s app, which now utilizes augmented reality (guitAR, if you will), to overlay instructions when using the front facing camera on a mobile device. The are flash cards (for chords), videos and games on-board, as well.

The app also has a song book, featuring a wide variety of popular artists, ranging from The Beatles to Taylor Swift. Kids can slow down and mute tracks to play along karaoke-style, while recording themselves in the process.

Kickstarter prices start at $99 for the Mini, versus $150 at retail. The company keeps going back to the crowdfunding well, but the model has worked pretty well so far. Loog’s started to gain some traction in the music education world and, as evidence by its Kickstarter video, landed in the hands of a couple of actual rockstars in the process.


Source: TechCrunch – Startups

07 Aug

Gogoro announces Yamaha, Aeon and PGO are the first manufacturers that will use its swappable batteries in their own scooters

Gogoro, the Taiwanese electric vehicle company, has announced its first manufacturing partners. Yamaha, Aeon Motor and PGO will all launch new scooters this summer that run on Gogoro’s swappable batteries and charging infrastructure.

This means consumers who like Gogoro’s battery system will have a choice between buying Gogoro’s own scooters or scooters from its three partners. All scooters that use Gogoro’s energy network can exchange batteries at the 1,300 GoStations currently in Taiwan.

Beyond its own electric scooters, Gogoro sees its technology, most of which is developed in-house, as an open platform for electric vehicles, with the goal of reducing pollution in cities with heavy traffic. It recently launched a ride-sharing platform that can be used as a white-label solution by companies that want to launch their own electric scooter sharing program (Gogoro’s scooters are already use by Coup, the European ride-sharing startup).

For a deeper look into the company’s origins and plans, Extra Crunch subscribers can read a recently published interview with Gogoro co-founder and CEO Horace Luke.


Source: TechCrunch – Startups

06 Aug

DeepCode gets $4M to feed its AI-powered code review tool

DeepCode, a Swiss startup that’s using machine learning to automate code reviews, has closed a $4M seed round, led by European VC firm Earlybird, with participation from 3VC and existing investor btov Partners.

The founders described the platform as a sort of ‘Grammarly for coders’ when we chatted to them early last year. At the they were bootstapping. Now they’ve bagged their first venture capital to dial their efforts up.

DeepCode, which is spun-out of Swiss technical university ETH Zurich, says its code review AI is different because it doesn’t just pick up syntax mistakes but is able to determine the intent of the code because it processes millions of commits — giving it an overview that allows it to identify many more critical bugs and vulnerabilities than other tools.

“All of the static analysis and lint tools out there (there are hundreds of those) are providing similar code analysis services but without the deeper understanding of code, and mostly focusing on one language or specific languages,” says CEO and co-founder, Boris Paskalev, going on to name-check the likes of CA Technologies, Micro Focus (Fortify), Cast Software, and SonarSource as the main competitors DeepCode is targeting.

Its bot is free for enterprise teams of up to 30 developers, for open source software, and for educational use.

To use it developers connect DeepCode with their GitHub or Bitbucket accounts, with no configuration required. The bot will then immediately start reviewing each commit — picking up issues “in seconds”.  (You can see a demo of the code review tool here.)

“We do not disclose developer information but the number of Open Source Repositories that are using DeepCode have hundreds of thousands of total contributors,” Paskalev tells us when asked how many developers are using the tool now.

“We do not count rules per se as our AI Platform combines thousands of programming concepts, which if combined in individual rules will result in millions of separate rules,” he adds.

The seed funding will go on supporting additional integrations and more programming languages than the three currently supported (namely: Java, JavaScript, and Python); on improving the scope of code recommendations, and on expanding the team internationally.

Commenting in a statement, Christian Nagel, partner and co-founder of Earlybird, said: “For all industries and almost every business model, the performance and quality of coding has become key. DeepCode provides a platform that enhances the development capabilities of programmers. The team has a deep scientific understanding of code optimization and uses artificial intelligence to deliver the next breakthrough in software development.”


Source: TechCrunch – Funding and Exits

10 Jul

Remitly raises $220M to expand from money transfers to financial services, now at $900M+ valuation

When it comes to financial services in emerging markets, remittances — people sending money to each other across international borders, often not to established bank accounts — continues to be one of the biggest, with the World Bank estimating that $529 billion was sent in and out of lower-income countries in 2018, up 9% over 2017. And today, Remitly, one of the bigger startups providing these services, is announcing that it has raised $220 million in funding to ride that wave.

CEO and founder Matt Oppenheimer said in an interview that the startup will use the money both to help it continue to keep growing that money transfer business, and to catch new opportunities as they appear, in the form of new financial services for the immigrants and migrants that make up the majority of its customer base.

The money is coming in the form of equity and debt, specifically a $135 million Series E led by Generation Investment Management, and $85 million in debt from Barclays, Bridge Bank, Goldman Sachs, and Silicon Valley Bank. Owl Rock Capital, Princeville Global, Prudential Financial, Schroder & Co Bank AG, and Top Tier Capital Partners; and previous investors DN Capital, Naspers’ PayU, and Stripes Group all also participated in the equity round.

Oppenheimer said the equity will both be used to expand its remittance business but mainly to invest in that new wave of services it’s eyeing up. The debt, meanwhile, is to fuel the growth of its “express” fast-send option. “Today we can post funds, but we can also pre-fund for express transfers, and we wanted to have the capacity and the line of credit to be able to fund the pre-funding part, which is growing rapidly,” he said of the debt portion of the financing.

With the equity portion, Remitly’s valuation is now at around $900 million, sources close to the company say. As a point of comparison, that puts Remitly on par with World Remit, another big player in remittances for emerging markets that raised $175 million in June also at around a $900 million valuation. (Transferwise, which focuses on ‘banked’ accounts and mostly mature markets, earlier this year closed funding that valued it at $3.5 billion.)

It’s the biggest round of funding yet for the startup, and for some context, it was valued at just $230 million when it last disclosed the number. (Remitly did not disclose valuation in its most recent funding before this one, a $115 million round led by Naspers that finally closed in the beginning of 2018.)

Today, Remitly’s services cover 16 “send” (originating) and 44 “receive” countries, covering a total of some 700 “corridors” where the company specialises in providing an easy way — either online or by phone — for individuals to send money, with the service localised on the receiving end to come in formats that are most popular in each specific market.

The company said that average annual revenue growth has been at around 100% each year for the past three. Oppenheimer — who coincidentally used to be an executive for one of its new backers, Barclays — wouldn’t break out which markets were growing faster than the others, but that figure includes both Remitly’s more mature corridors as well as those that it’s added in recent years.

The plan for diversification is not surprising. The remittance market is extremely fragmented and — with the rise of smartphones that have untethered users from physical retail locations — getting even more so, with incumbents like Western Union accounting for less than 20 percent of the market today, bigger startups like TransferWise also looking like it’s also increasingly eyeing emerging markets as well, and completely new concepts like using the blockchain to transfer money also potentially disrupting the disruptors.

That means pricing on money transfers for a section of that market that is already price-sensitive — immigrants and migrants — is very competitive, which in turn means a hit on remittance companies’ margins. Remitly itself has varying rates for different markets based on demand: sending money for example to Kenya from the UK currently costs nothing if you’re using MPESA accounts (other corridors obviously have higher costs than this).

Oppenheimer wouldn’t specify what kinds of other financial services it’s considering until they are closer to getting launched.

“We’re still working on that, but you can imagine the immigrant or migrant journey and the challenges that they face as they move to a new country,” he said. “It can have a painful impact not having a credit history: how do you get a loan, or set up a bank account? That is the strategic angle… The idea is to transform the lives of immigrants and their families.”

That mindset has been what helped Remitly raise this recent round. Generation — the investment firm co-founded by Al Gore — has made it a mission to put its money into sustainability. In its case, this means not only planet health but people health, in the form of services that improving the lives. Financial services for emerging markets is an important area for it in that regard.

Lucia Rigo, a director in growth equity at Generation who is joining Remitly’s board with this round, said that Generation had been looking at the remittance market for a while and had honed in on Remitly as a key company within it that ticked all the right boxes in terms of its mission, its journey so far, its numbers, and most importantly its prospects.

“Foreign-born or foreign-resident populations in developed markets is a segment that is just not catered for well,” she said in an interview. “There are a lot of digital means for sending money today, which is definitely driving down the cost of doing so, but we also think that digital penetration is just at its early stages, and new markets will drive differentiation and that will expand the customer base, and Remitly’s services.”


Source: TechCrunch – Startups

09 Jul

AppLovin acquires SafeDK to improve brand safety

Mobile marketing company AppLovin is announcing that it has acquired SafeDK.

While AppLovin started out as a mobile ad business, it now bills itself as “a comprehensive mobile gaming platform,” offering tools for game developers around user acquisition, monetization, analytics and (through Lion Studios, launched last year) publishing. SafeDK, meanwhile, allows developers to manage all the different SDKs on which their apps rely.

Palo Alto-headquartered AppLovin says that by incorporating SafeDK technology, it will help its publishers ensure GDPR compliance and brand safety.

It also says SafeDK will continue to support existing customers, while its headquarters in Herzliya, Israel will become AppLovin’s first office in Israel. Co-founders Orly Shoavi and Ronnie Sternberg will remain on-board as the heads of SafeDK and general managers of AppLovin Israel.

The companies are not disclosing the financial terms of the deal, except to say that it was all-cash. According to Crunchbase, SafeDK has raised a total of $5.8 million from investors, including Samsung Next Tel Aviv, Marius Nacht, StageOne Ventures and Kaedan Capital.

“We are delighted to be working with the AppLovin team to help mobile game publishers grow their businesses,” Shoavi said in a statement. “AppLovin has been a trusted partner for the biggest mobile game studios around the world and SafeDK’s technology will strengthen that trust.”


Source: TechCrunch – Funding and Exits

12 Jun

Modern Fertility raises $15 million to sell its hormone tests — and gather more fertility data from its users

Modern Fertility is a San Francisco-based company that sells fertility tests directly to consumers, but increasingly, those customers will be educating the company, too. Indeed, the two-year-old startup now plans to develop a database of anonymized data about its largely younger demographic.

A fresh $15 million in funding led by Forerunner Ventures should help. Forerunner founder Kirsten Green, who takes a board seat as part of the round, is known for countless savvy bets on a wide number of consumer brands that have taken off with users, from Dollar Shave Club to Bonobos to Glossier. With Forerunner’s help, Modern Fertility may well become a breakout hit, too, though potential customers should also understand its limitations before they click the “buy” button.

First, let’s back up. We’d originally written about Modern Fertility last year, when it began selling a kit from its website that’s sent to women’s doorsteps and allows them to gauge their levels of eight different reproductive hormones by using a finger prick. More specifically, the startup sends off its customers’ panels to CLIA-certified labs, where the tests are conducted, and most prominently, those tests are looking at the women’s level of AMH, or anti-mullerian hormone.

Why that’s relevant: every egg inside a woman’s ovaries sits within a fluid-filled sac full of cells that support egg maturation and produce hormones, including AMH. A woman’s AMH levels can provide one clue about how many of these sacs — or follicles — she has. That in turn provides a clue as to how many eggs she can release, or her ovarian reserve.

The point, says Modern Fertility’s cofounder and CEO, Afton Vechery, is to enable women to learn more about their bodies without having to shell out $1,500 to gain access to a similar picture by turning to a reproductive endocrinologist, of which there are relatively few.  According to the Centers for Disease Control and Prevention, there are roughly 500 infertility clinics in the U.S., and 2,000 reproductive endocrinologists.

Mixed feelings in medical community . . .

It’s a compelling pitch, especially given that women are putting off children longer for a variety of reasons, including to secure their financial future. In 2017, for the first time, U.S. women in their early 30s eclipsed younger moms to become the group with the highest birth rate, according to CDC data.

But there is room for pushback. The reality is that AMH and other tests can be conducted elsewhere, including by competing startups, for roughly the same cost that Modern Fertility is charging its customers. (Its kits originally sold from its website for $199; today, they sell for $159.)

Fertility testing is also generally is covered by health insurance plans because fertility problems can be linked to or caused by other health problems like endometriosis. (Not covered, typically: actual infertility treatments.)

A far bigger concern to some doctors is the unnecessary alarm that AMH screening may create for women who haven’t been diagnosed with infertility and who are less than 35 years old.

As Zev Rosenwaks, director of the Center for Reproductive Medicine at Weill Cornell Medicine and NewYork-Presbyterian, told the New York Times a couple of years ago, “All it takes is one egg each cycle . . . AMH is not a marker of whether you can or cannot become pregnant.”

Esther Eisenberg, the program director of the Reproductive Medicine and Infertility Program at the National Institutes of Health, has also said that AMH doesn’t dictate a woman’s reproductive potential. In fact, the NIH funded research in 2017 that found a “non-statistical difference” between low and normal AMH levels in a time-to-pregnancy study of women who were between the 30 to 44 years and who did not have a history of infertility.

Asked about such findings, Vechery, who was most recently a former product manager at the genetic testing company 23andMe, is clearly aware of them. She readily acknowledges that AMH is “not an indicator of your ability to get pregnant right now in this moment,” adding that “it has so many other helpful benefits in thinking about your reproductive health in a much broader sense.”

Vechery also notes the company’s team of PhDs. She points to a clinical study that was published in The Green Journal (the official publication from The American College of Obstetricians and Gynecologists). She also speaks of Modern Fertility’s medical advisory board, which includes dedicated five medical doctors, including reproductive endocrinologists Nataki Douglas, a former associate professor at Columbia University Medical Center, and Scott Nelson, a professor at the University of Glasgow.

All are important pieces to building Modern Fertility, but it’s nevertheless worth mentioning that the company employs just two full-time PhDs currently.

Further, the company’s medical advisory members, including Nelson, are paid consultants.

As for the study, which Modern Fertility sponsored, it doesn’t actually prove anything about the power of AMH testing, though it does underscore that AMH, along with the seven other hormones the company measures on behalf of its customers, can be tested just as effectively with “fingerstick sampling” as a traditional blood draw.

The teacher becomes the student . . .

Those curious about Modern Fertility — often younger women eager to get a jump on any later reproductive issues they may face — may well decide that information about their hormone levels is enough to part with the cost of a kit, the results of which are reviewed by a physician and that comes with a one-on-one phone consultation with a nurse.

Interestingly, when they do, they’ll increasingly be asked to opt-in to questions about their health, lifestyles, and more. They may be asked repeatedly, too, as the company recommends that customers re-take the test yearly to track their hormones over time. Indeed, because so many of Modern Fertility’s customers do not have fertility issues, the company hopes to aggregate as much pertinent information from them as possible in order to complement the vast amounts of research that has been conducted on infertility.

“The fertility space needs to catch up, and a huge part of what we’re focused on is moving fertility science forward,” says Vechery. “So much research is primarily done on these women who are having issues; Modern Fertility is interested in flipping that around.”

It’s a strange state of affairs, but we’ve talked with several customers of the company in the past, and one can imagine them supporting it however they can, thanks in part to the sense of community that Modern Fertility has also been fostering. Among other things, for example, the company hosts get-togethers for customers in San Francisco so they can share their thoughts, their fears, and, presumably, their results.

As for whether Modern Fertility is also interested in selling that anonymized data as has happened at genetic testing outfits like Ancestry and Vechery’s former employer, 23andMe, Vechery insists that it will not, that the information will instead be used to inform the company’s product development.

Fertility startups have generally been on a fundraising tear, and little wonder. According to one estimate, the  global fertility services market is expected to exceed $21 billion by 2020. In fact, while venture capital has poured into everything from period-tracking apps to sperm storage startups, Modern Fertility has its own direct competitors, excluding obstetricians. Among these is KindBody, a New York-based startup that raised $15 million two months ago, and three-year-old, Austin-based Everlywell, which has garnered $55 million from VCs so far.

Notably, Modern Fertility represents Forerunner’s first foray into the so-called femtech space. Asked about Green’s involvement, Vechery notes she was particularly “excited about the community,” which Phil Barnes of First Round Capital, has also cited as the reason he wrote Modern Fertility an early check.

Ultimately, though, says Vechery, “Our business model is information, and I think for Kirsten, seeing what that trusted brand could do in women’s health and the conversations it could spark” was what she found most compelling about the company.

We understand why. We also can’t help but wonder if those conversations will drive some women to see — unnecessarily — the very specialists that Modern Fertility wants to free them of visiting.

Modern Fertility has now raised $22 million to date. Among its other backers are Maveron and Union Square Ventures as investors.

Pictured above: Modern Fertility cofounders Afton Vechery and Carly Leahy. Vechery is CEO; Leahy is the company’s chief creative officer.


Source: TechCrunch – Startups

11 Jun

Foodles raises another $10 million for its cloud canteen

French startup Foodles is raising a $10 million funding round (€9 million). The company provides canteen-like services using connected fridges and daily deliveries.

Creadev, DN capital and Adelie are participating in today’s round. This isn’t just fresh capital as existing shareholder Elior is selling its shares in the company. Elior is a large catering and foodservice company — in some way, Elior and Foodles are competitors at a very different scale.

Foodles solves a specific issue for the French market. French companies have to subsidize lunch for their employees. They have two options — they can either open a canteen in the office or hand out meal vouchers to financially contribute to everyone’s lunch.

While big public companies usually work with a foodservice company, such as Elior, the upfront investment is too important for most small companies. Foodles addresses small companies with its full-stack solution.

When you sign up to Foodles, the company delivers connected fridges to your office. Every day, Foodles comes to your office to deliver 20 to 200 meals at once. By default, you get a handful of options.

Employees can then unlock the fridge by scanning a card, grab something and eat. They’re then charged automatically. It usually costs way less than ordering something on Deliveroo for instance.

If you want something different, you can also order a specific meal in the Foodles app. You can top up your account from the app as well.

With today’s funding round, the startup plans to double the size of the team and expand beyond the Paris area. And it’s also worth noting that Foodles is currently profitable thanks to positive unit economics — one delivery represents dozens of meals after all.

Recently, there have been many scandals about riders for food startups, such as Deliveroo, Uber Eats, Glovo and Frichti. They are underpaid, overworked and have to take many risks in order to generate a decent wage. Foodles knows that this is a key issue and promises that delivery people are full-time employees.

So far, the company has managed to convince 50 companies to switch to Foodles. The startup delivers around 5,000 meals per day. Foodles says that it plans to have a more aggressive sales strategy to sign more customers in the coming months.


Source: TechCrunch – Funding and Exits

15 May

VMware acquires Bitnami to deliver packaged applications anywhere

VMware announced today that it’s acquiring Bitnami, the package application company that was a member of the Y Combinator Winter 2013 class. The companies didn’t share the purchase price.

With Bitnami, the company can now deliver more than 130 popular software packages in a variety of formats, such as Docker containers or virtual machine, an approach that should be attractive for VMware as it makes its transformation to be more of a cloud services company.

“Upon close, Bitnami will enable our customers to easily deploy application packages on any cloud — public or hybrid — and in the most optimal format — virtual machine (VM), containers and Kubernetes helm charts. Further, Bitnami will be able to augment our existing efforts to deliver a curated marketplace to VMware customers that offers a rich set of applications and development environments in addition to infrastructure software,” the company wrote in a blog post announcing the deal.

Per usual, Bitnami’s founders see the exit through the prism of being able to build out the platform faster with the help of a much larger company. “Joining forces with VMware means that we will be able to both double-down on the breadth and depth of our current offering and bring Bitnami to even more clouds as well as accelerating our push into the enterprise,” the founders wrote in a blog post on the company website.

Holger Mueller, an analyst at Constellation Research says the deal fits well with VMware’s overall strategy. “Enterprises want easy, fast ways to deploy packaged applications and providers like Bitnami take the complexity out of this process. So this is a key investment for VMware that wants to position itselfy not only as the trusted vendor for virtualizaton across the hybrid cloud, but also as a trusted application delivery vendor,” he said.

The company has raised a modest $1.1 million since its founding in 2011 and says that it has been profitable since early days when it took the funding. In the blog post, the company states that nothing will change for customers from their perspective.

“In a way, nothing is changing. We will continue to develop and maintain our application catalog across all the platforms we support and even expand to additional ones. Additionally, if you are a company using Bitnami in production, a lot of new opportunities just opened up.”

Time will tell whether that is the case, but it is likely that Bitnami will be able to expand its offerings as part of a larger organization like VMware. The deal is expected to close by the end of this quarter (which is fiscal Q2 2020 for VMware).

VMware is a member of the Dell federation of products and came over as part of the massive $67 billion EMC deal in 2016. The company operates independently, is sold as a separate company on the stock market and makes its own acquisitions.


Source: TechCrunch – Funding and Exits

15 May

Tealium, a big data platform for structuring disparate customer information, raises $55M at $850M valuation

The average enterprise today uses about 90 different software packages, with between 30-40 of them touching customers directly or indirectly. The data that comes out of those systems can prove to be very useful — to help other systems and employees work more intelligently, to help companies make better business decisions — but only if it’s put in order: now, a startup called Tealium, which has built a system precisely to do just that and works with the likes of Facebook and IBM to help manage their customer data, has raised a big round of funding to continue building out the services it provides.

Today, it is announcing a $55 million round of funding — a Series F led by Silver Lake Waterman, the firm’s late-stage capital growth fund; with ABN AMRO, Bain Capital, Declaration Partners, Georgian Partners, Industry Ventures, Parkwood and Presidio Ventures also participating.

Jeff Lunsford, Tealium’s CEO, said the company is not disclosing valuation, but he did say that it was “substantially” higher than when the company was last priced three years ago. That valuation was $305 million in 2016, according to PitchBook — a figure Lunsford didn’t dispute when I spoke with him about it, and a source close to the company says it is “more than double” this last valuation, and actually around $850 million.

He added that the company is close to profitability and is projected to make $100 million in revenues this year, and that this is being considered the company’s “final round” — presumably a sign that it will either no longer need external funding and that if it does, the next step might be either getting acquired or going public.

This brings the total raised by Tealium to $160 million.

The company’s rise over the last eight years has dovetailed with the rapid growth of big data. The movement of services to digital platforms has resulted in a sea of information. Much of that largely sits untapped, but those who are able to bring it to order can reap the rewards by gaining better insights into their organizations.

Tealium had its beginnings in amassing and ordering tags from internet traffic to help optimise marketing and so on — a business where it competes with the likes of Google and Adobe.

Over time, it has expanded and capitalised to a much wider set of data sources that range well beyond web and commerce, and one use of the funding will be to continue expanding those data sources, and also how they are used, with an emphasis on using more AI, Lunsford said.

“There are new areas that touch customers like smart home and smart office hardware, and each requires a step up in integration for a company like us,” he said. “Then once you have it all centralised you could feed machine learning algorithms to have tighter predictions.”

That vast potential is one reason for the investor interest.

“Tealium enables enterprises to solve the customer data fragmentation problem by integrating and enriching data across sources, in real-time, to create audiences while providing data governance and fidelity,” said Shawn O’Neill, managing director of Silver Lake Waterman, in a statement. “Jeff and his team have built a great platform and we are excited to support the company’s continued growth and investment in innovation.”

The rapid growth of digital services has already seen the company getting a big boost in terms of the data that is passing through its cloud-based platform: it has had a 300% year-over-year increase in visitor profiles created, with current tech customers including the likes of Facebook, IBM, Visa and others from across a variety of sectors, such as healthcare, finance and more.

“You’d be surprised how many big tech companies use Tealium,” Lunsford said. “Even they have a limited amount of bandwidth when it comes to developing their internal platforms.”

People like to say that “data is the new oil,” but these days that expression has taken on perhaps an unintended meaning: just like the overconsumption of oil and fossil fuels in general is viewed as detrimental to the long-term health of our planet, the overconsumption of data has also become a very problematic spectre in our very pervasive world of tech.

Governments — the European Union being one notable example — are taking up the challenge of that latter issue with new regulations, specifically GDPR. Interestingly, Lunsford says this has been a good thing rather than a bad thing for his company, as it gives a much clearer directive to companies about what they can use, and how it can be used.

“They want to follow the law,” he said of their clients, “and we give them the data freedom and control to do that.” It’s not the only company tackling the business opportunity of being a big-data repository at a time when data misuse is being scrutinised more than ever: InCountry, which launched weeks ago, is also banking on this gap in the market.

I’d argue that this could potentially be one more reason why Tealium is keen on expanding to areas like IoT and other sources of customer information: just like the sea, the pool of data that’s there for the tapping is nearly limitless.


Source: TechCrunch – Startups