Month: August 2021

OwnBackup, the late stage startup that helps companies in the Salesforce ecosystem back up their data, announced a $240 million Series E today at a $3.35 billion valuation. The latter is up from $1.4 billion in January when the company announced a $167.5 million Series D.

Alkeon Capital and B Capital Group co-led today’s investment, which also included BlackRock Private Equity Partners and Tiger Global along with existing investors Insight Partners, Salesforce Ventures, Sapphire Ventures and Vertex Ventures. The company has now raised close to $500 million, over $455 million coming since last July.

That’s a lot of capital, but OwnBackup CEO Sam Gutmann says that as the Salesforce ecosystem has grown, which includes not only Salesforce itself, but companies like Veeva and nCino, business has been booming, growing 100% year-over-year since 2018. That kind of growth gets investor attention and Gutmann reported a lot of inbound investor interest in this round.

What’s more, the company announced that it will now support the same type of backup for Microsoft Dynamics 365 customers, thereby greatly expanding its potential market. “We’re also announcing that we are expanding into the Microsoft ecosystem specifically around Microsoft Dynamics 365’s huge ecosystem. I think it’s the second largest B2B SaaS ecosystem beyond Salesforce. We’re just getting started there, but super excited about the opportunity,” he said.

The company also sees the opportunity to grow the business through acquisition. Over the last year, it bought two small companies, but he says that was more focussed on acquiring specific talent to develop the platform, while future acquisitions could be more focussed on expanding the business itself. He certainl

As the company takes on this kind of investment, Gutmann sees an IPO possibility at some point in the future, but for now he’s concentrating on growth. “We’re not focused on exiting. We’ve really focused on developing what is already a huge market and growing into an even bigger market, continuing to expand with a business that has great unit economics and continues to grow nicely,” he said.

The company has ballooned to 500 employees this year with plans to double that number in the next year. As he does that, Gutmann says that hiring in general is challenging, but he is always looking to find ways to diversify his workforce. “It’s really, really hard. Our hiring managers definitely focus on [diversity], but at the end of the day, we want the best employees for the job. I think we’ve made a lot of strides. We’re working with one of our largest investors Insight, who is co-sponsoring a program to train, more on the junior side, some underrepresented minorities in technical fields and bring them on as full time employees after that program,” Gutmann said.

Gutmann says his offices have remained open throughout the pandemic, but nobody was required to come in. In fact, he says that his company is one of the few that has actually added office space to make it easier to distance. The company, which is located in New Jersey, has also expanded space outdoors for working outside when the weather permits.

Scotts Miracle-Gro knows how to make plants grow, and now the company is looking to cannabis companies to grow its balance sheet. The company today announced an investment entity specifically for cannabis.

Called The Hawthorne Collective, the entity is said to be pursuing minority investments in companies not currently being pursued by ScottsMiracle-Gro’s cannabis subsidiary, The Hawthorne Gardening Company, which owns and operates dozens of cannabis-focused gardening brands.

The Hawthorne Collective’s first investment comes in a $150 million convertible loan to Toronto-based RIV Capital, a cannabis investment and acquisition firm. According to the company’s press release, the note accrues interest at 2.03%, and upon close, RIV Capital will become The Collective’s preferred vehicle for future investments.

The addition of this investment vehicle gives Scotts Miracle-Gro a new entry into the expanding world of cannabis. Its operating subsidiary, The Hawthorne Gardening Company, already houses some of cannabis’ most potent gardening brands.

“Indeed, the growth of The Hawthorne Gardening Company over the past six years has generated significant shareholder value,” said Jim Hagedorn, Scotts Miracle-Gro Chairman and CEO, in a released statement. “It also has allowed us to develop a rare level of expertise and insight regarding the cannabis space without being involved in the plant-touching aspects of the industry. That is why we are beginning to invest in other areas of the industry through The Collective while continuing to pursue near-in strategic acquisitions to fold into the existing Hawthorne Gardening business.”

Upscribe founder and CEO Dileepan Siva watched the retail industry make a massive shift to subscription e-commerce for physical products over the past decade, and decided to get in it himself in 2019.

The Los Angeles-based company, developing subscription software for direct-to-consumer e-commerce merchants, is Siva’s fourth startup experience and first time as founder. He closed a $4 million seed round to go after two macro trends he is seeing: buying physical products, like consumer-packaged goods, on a recurring basis, and new industries offering subscriptions, like car and fashion companies.

Merchants use Upscribe’s technology to drive subscriber growth, reduce churn and enable their customers to personalize a subscription experience, like skipping shipments, swapping out products and changing the order frequency. Brands can also feature products for upsell purposes throughout the subscriber lifecycle, from checkout to post-purchase.

Upscribe also offers APIs for merchants to integrate tools like Klaviyo, Segment and Shopify — a new subscription offering for checkouts.

Uncork Capital led the seed round and was joined by Leaders Fund, The House Fund, Roach Capitals’ Fahd Ananta and Shippo CEO Laura Behrens Wu.

“As the market for D2C subscriptions booms, there is a need for subscription-first brands to grow and scale their businesses,” said Jeff Clavier, founder and managing partner of Uncork Capital, in a written statement. “We have spent a long time in the e-commerce space, working with D2C brands and companies who are solving common industry pain points, and Upscribe’s merchant-centric approach raised the bar for subscription services, addressing the friction in customer experiences and enabling merchants to engage subscribers and scale recurring revenue growth.”

Siva bootstrapped the company, but decided to go after venture capital dollars when Upscribe wanted to create a more merchant-centric approach, which required scaling with a bigger team. The “real gems are in the data layer and how to make the experience exceptional,” he added.

The company is growing 43% quarter over quarter and is close to profitable, with much of its business stemming from referrals, Siva said. It is already working with customers like Athletic Greens, Four Sigmatic and True Botanicals and across multiple verticals, including food and beverage, health and wellness, beauty and cosmetics and home care.

The new funding will be used to “capture the next wave of brands that are going to grow,” he added. Siva cites the growth will come as the DTC subscription market is forecasted to reach $478 billion by 2025, and 75% of those brands are expected to offer subscriptions in the next two years. As such, the majority of the funding will be used to bring on more employees, especially in the product, customer success and go-to-market functions.

Though there is competition in the space, many of those are focused on processing transactions, while Siva said Upscribe’s approach is customer relationships. The cost of acquiring new customers is going up, and subscription services will be the key to converting one-time buyers into loyal customers.

“It is really about customer relationships and the ongoing engagement between merchants and subscribers,” he added. “We are in a different world now. The first wave could play the Facebook game, advertising on social media with super low acquisition and scale. That is no longer the case anymore.”

 

Weeks after Instagram rolled out increased protections for minors using its app, Google is now doing the same for its suite of services, including Google search, YouTube, YouTube Kids, Google Assistant, and others. The company this morning announced a series of product and policy changes that will allow younger people to stay more private and protected online and others that will limit ad targeting.

The changes in Google’s case are even more expansive than those Instagram announced, as they span across an array of Google’s products, instead of being limited to a single app.

Though Congress has been pressing Google and other tech companies on the negative impacts their services may have on children, not all changes being made are being required by law, Google says.

“While some of these updates directly address upcoming regulations, we’ve gone beyond what’s required by law to protect teens on Google and YouTube,” a Google spokesperson told TechCrunch. “Many of these changes also extend beyond any single current or upcoming regulation. We’re looking at ways to develop consistent product experiences and user controls for kids and teens globally,” they added.

In other words, Google is building in some changes based on where it believes the industry is going, rather than where it is right now.

On YouTube, Google says it will “gradually” start adjusting the default upload setting to the most private option for users ages 13 to 17, which will limit the visibility of videos only to the the users and those they directly share with, not the wider public. These younger teen users won’t be prevented from changing the setting back to “public,” necessarily, but they will now have to make an explicit and intentional choice when doing so. YouTube will then provide reminders indicating who can see their video, the company notes.

YouTube will also turn on its “take a break” and bedtime reminders by default for all users ages 13 to 17 and will turn off autoplay. Again, these changes are related to the default settings  — users can disable the digital well-being features if they choose.

On YouTube’s platform for younger children, YouTube Kids, the company will also add an autoplay option, which is turned off autoplay by default so parents will have to decide whether or not they want to use autoplay with their children. The change puts the choice directly in parents’ hands, after complaints from child safety advocates and some members of Congress suggested such an algorithmic feature was problematic. Later, parents will also be able to “lock” their default selection.

YouTube will also remove “overly commercial content” from YouTube Kid, in a move that also follows increased pressure from consumer advocacy groups and childhood experts, who have long since argued that YouTube encourages kids to spend money (or rather, beg their parents to do so.) How YouTube will draw the line between acceptable and “overly commercial” content is less clear, but the company says it will, for example, remove videos that focus on product packaging — like the popular “unboxing” videos. This could impact some of YouTube’s larger creators of videos for kids, like multi-millionaire Ryan’s Toy Review.

Elsewhere on Google, other changes impacting minors will also begin rolling out.

In the weeks ahead, Google will introduce a new policy that will allow anyone under the age of 18, or a parent or guardian, to request the removal of their images from Google Image search results. This expands upon the existing “right to be forgotten” privacy policies already live in the E.U., but will introduce new products and controls for both kids and teenagers globally.

The company will make a number of adjustments to user accounts for people under the age of 18, as well.

In addition to the changes to YouTube, Google will restrict access to adult content by enabling its SafeSearch filtering technology by default to all users under 13 managed by its Google Family Link service. It will also enable SafeSearch for all users under 18 and make this the new default for teens who set up new accounts. Google Assistant will enable SafeSearch protections by default on shared devices, like smart screens and their web browsers. In school settings where Google Workspace for Education is used, SafeSearch will be the default and switching to Guest Mode and Incognito Mode web browsing will be turned off by default, too, as was recently announced.

Meanwhile, location history is already off by default on all Google accounts, but children with supervised accounts now won’t be able to enable it. This change will be extended to all users under 18 globally, meaning location can’t be enabled at all under the children are legal adults.

On Google Play, the company will launch a new section that will inform parents about which apps follow its Families policies, and app developers will have to disclose how their apps collect and use data. These features — which were partially inspired by Apple’s App Store Privacy Labels — had already been detailed for Android developers before today.

Google’s parental control tools are also being expanded. Parents and guardians who are Family Link users will gain new abilities to filter and block news, podcasts, and access to webpages on Assistant-enabled smart devices.

For advertisers, there are significant changes in store, too.

Google says it will expand safeguards to prevent age-sensitive ad categories from being shown to teens and it will block ad targeting based on factors like age, gender, or interests for users under 18. While somewhat similar to the advertising changes Instagram introduced, as ads will no longer leverage “interests” data for targeting young teens and kids, Instagram was still allowing targeting by age and gender. Google will not. The advertising changes will roll out globally in the “coming months,” the company says.

All the changes across Google and YouTube will roll out globally.

 

Every woman will go through menopause some time during her life, but like many other femtech topics, this one is still not talked about as much as it should be.

Enter Elektra Health, a women’s health technology company startup that raised $3.75 million in seed funding to continue developing its platform that provides evidence-based care, education and a community for women going through the various stages of menopause.

Co-founders Alessandra Henderson and Jannine Versi told TechCrunch that more than 50 million women in the United States are currently in some stage of menopause, while the industry itself represents a $600 billion global market opportunity.

CEO Henderson, whose background includes business creation platform Human Ventures, called menopause a “cultural zeitgeist” that is coming into its own in terms of the conversation and having investors believe in Elektra’s mission. The company is also personal for Henderson — she went on a hormonal health journey that began four years ago after experiencing symptoms that went unexplained by specialists.

Several years later, she wanted to start a company in femtech. There was so much already in the reproductive space, yet no one was talking about what comes next or the phases for moving through menopause, Henderson said. It was when she was introduced to her co-founder Versi, whose background is in digital health, that the idea for Elektra came together.

Menopause is a hormonal health transition that typically starts in women when they reach their 40s or 50s. There have been up to 34 identified symptoms of menopause, and research has found that 80% of women say menopause symptoms have negatively impacted their quality of life in some way. At the same time, less than 20% of obstetrics/gynecology residency programs educate doctors about menopause.

Elektra’s platform is picking up that slack by offering clinical care via telemedicine and its proprietary “Meno-morphosis” program that features evidence-based guidance on symptoms, a community of support and access to a 1:1 dedicated menopause expert. The program will open completely to the public in 2022.

“We are all about caring for women by providing content, education, care, coaching and counseling, especially working in the arc of their journey,” Versi said. “This is such an intimate topic, but we have referral rates of 40% where women are talking about it themselves and then bring a friend along. Sustaining that is important to us. We are seeing clusters of friends come along and really bond with the community.”

The New York-based company’s seed funding was co-led by Alexis Ohanian’s Seven Seven Six and Flare Capital Partners, with participation from City Light Capital, January Ventures, Human Ventures, The Fund, Community Fund and a group of angel investors, including Hannah and Guy Raz, Claire Diaz-Ortiz and Jenny Fielding.

This new round of funding will be used to grow its team and to expand its integrative, evidence-based solution to millions of women in the U.S., and beyond.

Since launching the company in 2020, more than 1,800 women have participated in Elektra’s private beta educational programming.

“Last year was about learning and growing the things that women want,” Henderson said. “We are making an impact in the way women deserve.”

Much of women’s health technology is aimed at fertility, but Elektra Health is not alone in tackling this issue: new startup Peppy recently reported funding to address menopause in employee health; meanwhile, Vira Health raised £1.5 million in seed funding for a U.K. platform. Other startups, like The Cusp, Clue and CurieMD, are also targeting this space with products and services.

Katelin Holloway, founding partner at Seven Seven Six, said in her previous roles leading compensation and benefits for companies, she became increasingly aware that the need for menopause care was just as desired by employees as fertility benefits.

When her employees began requesting desk fans, she started investigating the source of the requests and found it was from the company’s non-Gen Z employees, and all women.

“I realized I had a decent cohort of women experiencing menopause,” Holloway said. “The fan on the desk was kind of a ‘bat signal’ to other employees, unlocking conversations between them where they had previously been experiencing these symptoms in silos.”

Once she became an investor, she put out the call again looking for a company providing that kind of care and was introduced to Elektra. Holloway said there is a whole new group of women entering their 40s who want to talk about menopause and have the technology available, while also wanting privacy for care and a community to share in the experience.

She called Elektra’s co-founders “incredible women who care deeply about this space and have amazing credentials and background to bring to this company.” She also said she was sold on their approach of care, community and content, which aligns with what was working in the pregnancy and fertility spaces.

 

Home-cooked food delivery service WoodSpoon is planning an expansion after raising $14 million in Series A funding.

Restaurant Brands International led the round along with World Trade Ventures and a group of individual investors, including Victor Lazarte.

New York-based WoodSpoon was started in 2019 by Oren Saar and Merav Kalish Rozengarten, two Israelis in America that longed for the food they grew up with. They began reaching out to local home chefs in the area and gathered them together in a marketplace where they could share their culture and passion of food with others.

Two years later, the company boasts over 16,000 active customers in Manhattan, Brooklyn and Queens and 50% month over month growth. Customers can order dishes that run the gambit of world cuisine through WoodSpoon’s website or app and receive on-demand delivery to their doorstep or schedule service. Saar told TechCrunch that 35% of WoodSpoon’s customers have ordered four times in 17 days after their first order.

The new funding gives the company a total of $16 million — it raised $2 million at the end of 2020. Saar said the Series A enables the company to accelerate growth through R&D and marketing and to double its team so it can expand into new markets, like major cities across the United States, over the next 12 months.

At the same time as it brings customers culturally diverse food, WoodSpoon helps generate income for its home chefs — a mix of 150 active professional chefs, immigrants and cooks making dishes for the company at least three times a month. WoodSpoon interviews each chef, inspects their kitchens and provides training to keep consistent quality.

“When you scale, you can lose touch with your customers and lose the personal connection with the home chefs,” Saar said. “We feel every home chef is part of our family and want to help them build their brand, so it is important that this food is high quality.”

WoodSpoon has about 30 employees and plans to hire more engineers to continue developing its technology. Saar said a new product will be launching at the end of August, while WoodSpoon’s app will get an overhaul to have a new look and feel.

The Series A also enables WoodSpoon to onboard its waitlist of hundreds of home chefs that want to join the marketplace.

Meanwhile, the global online food delivery services market is forecasted to be $126.91 billion in 2021, and then reach $192.16 billion in 2025, according to consultancy firm Research and Markets.

Chris Brigleb, head of corporate development at Restaurant Brands International, said technology is a big focus for his company, which spent a lot of time looking around for potential investments beyond the traditional quick-serve restaurant space.

He began meeting with tech-enabled businesses and came across WoodSpoon four months ago. The more Brigleb learned about the company, the more he liked it, and even encouraged Saar to speed up WoodSpoon’s growth and fundraising plans, he said.

Though WoodSpoon’s concept is not new, he felt its approach was the complete package of user experience on the customer side, the ease of searching the marketplace by chef or cuisine and support for the chef in terms of providing packaging and logistics management.

“The delivery was a key for us and a differentiator,” Brigleb said. “They take all of the hard parts about delivering for home chefs off of their plate so they can focus on the actual cooking that is special to them.”

 

Niantic continues to push forward in its quest to build a 3D map of the world.

This morning the company announced that it has acquired Scaniverse, an iPhone/iPad app for scanning objects and environments in high-resolution 3D.

A rep for Niantic tells me that Scaniverse will remain on the App Store, with plans to continue supporting it as a standalone app. Features previously limited to a $17-per-year “Pro” subscription, including higher-resolution processing and support for exporting models to other 3D software, will now be free.

As I first wrote about years ago, one of Niantic’s goals is to build a detailed and endlessly-evolving 3D map of the world — a step they see as fundamental to enabling true, rich augmented reality experiences if/when the world ever embraces something like AR glasses. It’s a rather massive (and never ending) task, but one made a bit more feasible by way of its ever-roaming player base across games like Pokémon GO, Harry Potter Wizards Unite, and Ingress.

As part of the deal, Scaniverse creator Keith Ito will be joining Niantic’s AR team. The company declined to outline any other terms of the acquisition. This is Niantic’s latest acquisition in the 3D mapping space, having acquired 6D.ai for an undisclosed sum in early 2020.

For context, here’s a demo of the Scaniverse app doing its thing:

 

Leafly is turning to a SPAC with Merdia Merger Corp. I to go public. The deal, valued at about $532 million and expected to generate proceeds of up to $161.5 million, includes Leafly’s recent capital raise of $31.5 million from investors, including Merida Capital Holdings.te

The company is expected to list on Nasdaq under the ticker symbol of LFLY as Merida will adopt the Leafly name. Existing Leafly shareholders will own about 72% of the merged company. The deal is expected to close in the fourth quarter of 2021.

Leafly was founded in 2010 and has grown into a leading marketplace and resource. The company offers a deep library of content for consumers, including detailed information about strains, retailers, and current events. For retailers, Leafly offers a subscription-based platform that 7,800 brands and 4,600 retail subscribers use. According to a report, the company is expected to see revenue hit $43 million in 2021 and $65 million in 2022.

Despite the successes, Leafly experienced a turbulent 2020 with layoffs and leadership changes. Yoko Miyashita took over as the company’s CEO in August 2020 and has been focused on Leafly, leaning heavily into building a better online shopping experience. In February 2021, the company partnered with Jane to improve Leafly’s e-commerce tools.

By going public through a SPAC, Leafly is signaling it’s entering a growth phase just in time for the US Government to loosen cannabis restrictions.

This morning, Wix announced a new product for business owners called Branded App by Wix, which allows users to develop native apps without writing code. The publicly-traded company provides tools for people and businesses to manage their online presence, but it’s most well-known for its drag-and-drop website builder. Now, the platform is expanding its user-friendly approach by making it possible for anyone to build an app without learning how to code.

“Users came to us with the need to create a native app that is branded with their name and logo,” said Ronny Elkayam, SVP of Mobile, App Market & Strategic Products at Wix. “Many of our users are businesses, and businesses have a desire to portray a situation that they are bigger than they are. They want to follow the big businesses that have native apps.”

At $200 per month, Branded App by Wix is no small investment; users will also have to pay a yearly $99 fee to be on the App Store, and a one-time $25 fee for Google Play. But according to Wix, native mobile apps can help businesses ultimately drive more sales. For users that already have a Wix website, the app builder can automatically integrate features from their website, making the process more simple.

“If you’re a restaurant, and you have your menu configured on your website for online ordering, the same menu is going to show up on the app. You don’t need to configure it. Any purchases or any orders from that menu are going to show up in your dashboard,” Elkayam said.

Out of Wix’s 200 million users, 5 million are paid subscribers. For businesses, Wix’s most popular plan is $27 per month for a website, which includes access to e-commerce features. Even users with a free website (which has limited capabilities and is emblazoned with the Wix logo) can create an app — Branded App by Wix is a new product, not an additional feature for existing subscribers. Business owners can customize their app’s icon, layout, and content, including product pages, booking services, forums and groups, chat functions, blogs, push notifications, and more. Wix will automatically update users’ apps to remain compatible with the latest versions of iOS and Android.

A competitor in the no-code app building space, Bubble charges between $29 and $529 per month, with a free plan for users to learn how to use the product and develop their app. But Bubble’s offerings are web-based, while Wix’s apps are native, which means they can be downloaded from the App Store and Google Play.

In 2020, Wix had 31 million new users — Elkayam said that Wix’s growth increased under the conditions of the coronavirus pandemic. The company will announce its Q2 earnings tomorrow, but in Q1, the company had $304 million in revenue, up 41% year-over-year.

After beta testing with hundreds of users, Branded App by Wix is now available to all users. Those who sign up during the temporary “presale” will get the product for 50% off for life.

Working in the world of disability insurance for a decade, Colin Nabity felt not everyone could access this type of insurance due to its nature of it being difficult to understand and underwrite.

Disability and critical illness insurance is typically income protection should someone be too sick or hurt to work. An average of 5.6% of working Americans each year will experience a short-term disability during a period of six months or less due to illness, injury or pregnancy. At the same time, 1 in 4 Americans currently live with a disability that impacts their major life activities.

Similar to other insurance products, disability insurance was sold the same way for more than 20 years: using outdated technology, data science and underwriting that didn’t provide consumers an appropriate policy based on their occupation and health. In addition, there was not a digital platform to sell this type of insurance directly to consumers, Nabity said.

Enter Omaha, Nebraska-based Breeze, the company Nabity started in 2019 with Cody Leach to enable individuals to go online and complete in 10 minutes the application process to receive a personalized quote for either disability insurance or critical illness insurance.

There are large incumbents in the space — for example Aflac, but Nabity said Breeze’s platform offers a digital approach to disability and critical illness applications, quotes and policy-making that offers consumers protection during events like cancer, heart attacks, strokes and other medical conditions that can lead to a loss of income if someone is unable to work.

The U.S. market for disability insurance was valued at $19.1 billion as of this year and was declining slightly since 2016, IBIS World reported. Breeze is reimagining these products to make them more affordable — a policy for several thousand dollars costs, on average, around $20 a month — and to provide consumer education so that purchasing this type of insurance is less intimidating, he added.

“We want a way for people to understand this type of insurance, make it more affordable and be bought completely online,” Nabity told TechCrunch. “These illnesses and injuries wreck families because they can be so financially devastating.”

Breeze raised $10 million in Series A funding in a round led by Link Ventures that Nabity boasts is the “largest first round of institutional capital ever invested in a Nebraska-based software startup.” Northwestern Mutual Ventures, Silicon Valley Bank, M25, Fiat Ventures and Invest Nebraska also participated in the financing.

Lisa Dolan, managing director at Link Ventures, said she found the company while examining web traffic data, where Breeze was listed among industry incumbents among consumers searching for disability.

Dolan admits that even she was not familiar, at the time, with disability insurance and has since learned that the market is larger than originally thought. She believes that by using technology to route the appropriate customer to the approach insurance, Breeze is able to reach customers that incumbent insurance carriers can’t get to.

Nabity did not disclose any growth metrics, but said he intends to use the new funding — the company’s first round of institutional capital — to grow its core products and add new products, carriers and agents to the platform. He will also increase Breeze’s headcount in the areas of software development, customer service and marketing.

“We are in the process of opening up our platform to agents that have not sold these products before, and we will need product and support teams to handle that increased volume,” he added.