Year: 2021

Late last week, independent journalist Eric Newcomer reported that Databricks is raising new capital at a valuation of “about $27 billion.” A few days later, another publication chimed in, saying that they had heard that the round could be worth $29 billion at a slightly higher valuation.

Well, well!

Last year, The Exchange covered Databricks’ financial progress as a private company. Databricks, as a refresher, provides its customers with analytics and data science tooling and crossed a $350 million run rate at the end of Q3 2020.

That figure was up from $200 million in the year-ago period. As we wrote at the time, Databricks was “an obvious IPO candidate” and a company with “broad private-market options.” Reports that it has raised more capital underscore our previous notes.

But we took it all one step further after news surfaced that Databricks could go public in the first half of 2021, noodling around with all the financial information we could scrape together for the company to come up with a valuation range. Our resulting figures were a bit low compared to recent news, which forms the crux of our work today: Can we come up with a set of numbers that help make sense of Databricks at $27 billion?

Databricks declined to comment. But that won’t stop us from having fun. So, let’s remind ourselves of what we know about Databricks’ growth history, economics and scale.

From there we will be able to check our estimates against its purported new valuation range and come up with some implied multiples. Then, we’ll contrast those with some high-flying public companies.

Do the numbers somewhat fit? Can we see Databricks making sense at more than $25 billion, more than four times its 2019-era private valuation of $6.2 billion? Let’s find out.

What’s it worth?

In our previous work, we ran a number of growth scenarios to come up with different estimates for Databricks’ current scale. Sparing you several hundred words, given how the company grew from $200 million in annual run rate to $350 million between Q3 2019 and Q3 2020, we estimated that the company would close Q1 2021 with between $425 million and $486.5 million in annualized revenue.

Looking at different data points from the Bessemer Cloud Index at the time while using some flexible-but-not-conservative estimates for Databricks’ revenue quality, we came up with market comps that would have given it a sales multiple of between 20x and 38x. At the high end of our revenue run rate guess for Q1 2021, and top multiple, you get a valuation of $18.5 billion.

Years ago, Uber had a problem. With millions of users and tens of thousands of drivers scattered across a widening expanse of the globe, the fast-growing mobility startup wanted to display more accurate maps to users about where their ride was coming from and where it was intending to go to reach its destination. The challenge is that geospatial datasets can easily reach into the petabytes, so how do you transmit and visualize such data — particularly on mobile?

“We were tasked with this massive planetary dataset,” Sina Kashuk explained about the purpose of Uber’s data visualization team, and “if money wasn’t an object, how would you architect this so that it would have the best performance?” That was the active problem that confronted a quad of engineers and data scientists tasked with solving the problem. Kashuk, Shan He, Isaac Brodsky and Ib Green collectively spent about 16 years at Uber, and they and their teammates at Uber built up what is today Uber’s extensive geospatial data visualization system. He, Brodsky and Green had joined Uber around 2014 and 2015, while Kashuk joined later in 2017.

Thankfully, the code they developed wasn’t locked inside the Uber app — core elements of their engineering were open-sourced into two libraries: Kepler.gl, a web application that can take geospatial datasets and visualize them, and Deck.gl, which offers an extensible application framework for processing geospatial datasets and preparing them for visualization. According to Kashuk, Green was one of the leaders in the development of Deck.gl, and He developed Kepler.gl a year later using Deck.gl as a base. Both libraries remain in active development on GitHub and through Uber’s Visualization team.

Eventually, the quad realized that they could offer services on top of these libraries to other businesses, given some of the interest they were seeing with the open-source projects. “What we realized is that [these libraries] are all mature and they are ready to go to the market [and] there is opportunity beyond usage at Uber, and we thought that we can take these technologies to the next level,“ Kashuk said. The four departed Uber and eventually came together to create Unfolded.ai in late 2019.

The four founders of Unfolded.ai. Via Unfolded.ai.

The startup’s main product is called Unfolded Studio, which acts as a backend-as-a-service for applications built on top of Kepler.gl (which is only a frontend library itself) handling components like data management and server communications. In particular, the product is designed to bring different geospatial datasets together and allow them all to interact with each other in one unified view.

The team first funded their operations with some consulting projects, including with Google Earth, but now it has raised a seed round to further expand the team and its ambitions. To date according to Kashuk, Unfolded has raised a bit more than $6 million, with a seed round that closed last week led by Shvet Jain at S28 Capital with participation from other firms including Fontinalis Ventures. Auren Hoffman wrote the first personal check into the company, and the first institutional VC was IA Ventures.

Some of the first customers of the Unfolded platform have been in agtech, including a company called Indigo Agriculture, which focuses on helping farmers grow crops and livestock sustainably. Unfolded sees potential in many markets where location data intersects business, but for now, remains mostly heads down building out its platform and readying itself for more customers.

Years ago, Uber had a problem. With millions of users and tens of thousands of drivers scattered across a widening expanse of the globe, the fast-growing mobility startup wanted to display more accurate maps to users about where their ride was coming from and where it was intending to go to reach its destination. The challenge is that geospatial datasets can easily reach into the petabytes, so how do you transmit and visualize such data — particularly on mobile?

“We were tasked with this massive planetary dataset,” Sina Kashuk explained about the purpose of Uber’s data visualization team, and “if money wasn’t an object, how would you architect this so that it would have the best performance?” That was the active problem that confronted a quad of engineers and data scientists tasked with solving the problem. Kashuk, Shan He, Isaac Brodsky and Ib Green collectively spent about 16 years at Uber, and they and their teammates at Uber built up what is today Uber’s extensive geospatial data visualization system. He, Brodsky and Green had joined Uber around 2014 and 2015, while Kashuk joined later in 2017.

Thankfully, the code they developed wasn’t locked inside the Uber app — core elements of their engineering were open-sourced into two libraries: Kepler.gl, a web application that can take geospatial datasets and visualize them, and Deck.gl, which offers an extensible application framework for processing geospatial datasets and preparing them for visualization. According to Kashuk, Green was one of the leaders in the development of Deck.gl, and He developed Kepler.gl a year later using Deck.gl as a base. Both libraries remain in active development on GitHub and through Uber’s Visualization team.

Eventually, the quad realized that they could offer services on top of these libraries to other businesses, given some of the interest they were seeing with the open-source projects. “What we realized is that [these libraries] are all mature and they are ready to go to the market [and] there is opportunity beyond usage at Uber, and we thought that we can take these technologies to the next level,“ Kashuk said. The four departed Uber and eventually came together to create Unfolded.ai in late 2019.

The four founders of Unfolded.ai. Via Unfolded.ai.

The startup’s main product is called Unfolded Studio, which acts as a backend-as-a-service for applications built on top of Kepler.gl (which is only a frontend library itself) handling components like data management and server communications. In particular, the product is designed to bring different geospatial datasets together and allow them all to interact with each other in one unified view.

The team first funded their operations with some consulting projects, including with Google Earth, but now it has raised a seed round to further expand the team and its ambitions. To date according to Kashuk, Unfolded has raised a bit more than $6 million, with a seed round that closed last week led by Shvet Jain at S28 Capital with participation from other firms including Fontinalis Ventures. Auren Hoffman wrote the first personal check into the company, and the first institutional VC was IA Ventures.

Some of the first customers of the Unfolded platform have been in agtech, including a company called Indigo Agriculture, which focuses on helping farmers grow crops and livestock sustainably. Unfolded sees potential in many markets where location data intersects business, but for now, remains mostly heads down building out its platform and readying itself for more customers.

TikTok, UC Browser, UC News, Baidu Map, Xiaomi’s Video and Community and 53 other Chinese apps that India banned in late June won’t be returning to the country anytime soon, the Indian government has decided, a source familiar with the matter told TechCrunch.

Last week New Delhi told the parent firms of these apps that it wasn’t satisfied with the responses they had provided so far to address cybersecurity concerns charged against them, the source said, requesting anonymity as the communication is private.

Citing this reason, New Delhi has said that it will retain the ban on these apps, but it has not completely shut communication channels with the firms, the source said. Indian media reported last week that the country, which is the world’s second largest internet market with over 600 internet users, was making the ban permanent.

Beginning in late June, India banned over 200 apps including PUBG Mobile with links to China last year amid geo-political tension between the two neighboring nations. All these apps engaged in activities that posed threats to “national security and defence of India, which ultimately impinges upon the sovereignty and integrity of India,” the nation’s IT ministry has said.

New Delhi has so far only reached out to the apps that were banned in late June.

TikTok has been the most high-profile app to be banned by India. ByteDance’s crown app had more than 200 million users in India prior to being blocked in the nation. Despite the ban, the company has retained most of its India-based employees so far.

A source told TechCrunch that ByteDance operates several properties in India including a productivity suite called Lark that remains operational in the country and the team continues to develop these apps. This information has not been previously reported. (UC Browser, too, was once very popular in India, though the rising popularity of Google’s Chrome browser put an end to the Chinese app’s dominance in the country.)

Despite the ban, TikTok and several of the blocked Chinese apps still maintain millions of users in the country who are using specialized software such as virtual private networks to access them. TikTok had over 5 million active users (MAU) in India last month, and PUBG Mobile over 15 million, according to mobile insight firm App Annie, data of which an industry executive shared with TechCrunch.

TikTok said it was reviewing New Delhi’s notice. “We continually strive to comply with local laws and regulations and do our best to address any concerns the government may have. Ensuring the privacy and security of all our users remains to be our topmost priority,” a spokesperson said.

The ban — as well as the whole U.S. drama about a potential block — hasn’t made much impact on ByteDance’s financials. The Information reported on Tuesday that ByteDance more than doubled its revenue last year to $37 billion, and increased its operating profit to $7 billion, from $4 billion in 2019.

American and Chinese firms have rushed to India in the past decade in search for their next billion users. But the South Asian nation contributes very little to these firms’ bottom line. Kunal Shah, a serial entrepreneur in India, said at a conference in 2018 that the nation has become an “MAU farm” for many companies.

Regardless, since their ban, TikTok and PUBG Mobile have explored various ways to make a comeback in India. TikTok engaged in early investment talks with Reliance Industries, one of India’s largest conglomerates, and PUBG Mobile cut ties with game publisher Tencent and pledged to invest $100 million in India.

Streaming data is not new. Kafka has existed as an open source tool for a decade. Vectorized was founded on the premise that the existing tools were too complex and not designed for today’s streaming requirements. Today the company released its first product, Redpanda, an open source tool designed to make it easier for developers to build streaming data applications.

While it was at it, the startup announced a $15.5 million funding round, which is actually a combination of a previously unannounced $3 million seed round led by Lightspeed Venture Partners and a $12.5 million Series A, which was also from Lightspeed with help from Google Ventures.

Redpanda is an open source tool that is delivered as an “intelligent API” to help “turn data streams into products,” company founder and CEO Alexander Gallego explained. It’s built to be a Kafka replacement, while remaining Kafka-compatible to help deal with backwards compatibility.

At the same time, it takes a more modern approach. Gallego points out that teams building data streaming applications have been getting lost in the complexity and he recognized an opportunity to build a company to simplify that.

“People are drowning in complexity today managing Kafka, ZooKeeper (an open source configuration management tool) and the data lake,” he said, adding “We enable new things that couldn’t be done before for several reasons: one is performance, one is simplicity and the other one is this store procedures.”

He says that the key to developer adoption is making the product free through open source, and having Kafka compatibility so that developers don’t feel like they have to just dump existing projects and start from scratch. While the company is launching with an open source tool, it plans to use the funding to build a hosted version of Redpanda to put it within reach of more organizations. “This funding round in particular is to power our cloud,” he said.

Arif Janmohamed, a partner at Lightspeed Ventures who is leading the investment in Vectorized sees a company looking to improve upon an existing technology with a better approach. “With a simple, elegant solution that doesn’t require any changes to an existing application’s code, Vectorized delivers 10x better performance, a much simpler management paradigm, and new functionality that will unleash the next set of real-time applications for the next decade,” Janmohamed said.

The company has 22 employees today with plans to add another 8 in the first half of this year, mostly engineers to help build the hosted version. As a Latino founder, Gallego is acutely aware of the need for a diverse and inclusive workforce. “What I have found is that being a [Latino] CEO, it attracts more people that look like me, and so that’s been a big thing, and it’s made a difference [in attracting diverse candidates],” he said.

One concrete thing he has done is start a scholarship to encourage under represented groups to become developers. “I started a scholarship where we just give money and mentorship to communities of Latino, Black and female developers, or people that want to transition to software engineering,” he said. While he says he does it without strings attached, he does hope that some of these folks could become part of the tech industry eventually, and perhaps even work at his company.

This morning Fast, a startup that provides online checkout and identity products, announced that it has closed a $102 million Series B. The new funding event was led by Stripe, a previous investor in Fast.

Stripe, an online payments giant, also led Fast’s Series A last year, a deal worth $20 million. Fast has raised $124 million to date, it said in a release.

TechCrunch reached out to Fast for comment regarding its growth pace. The company shared that gross merchandise volume (GMV) processed by its checkout service has “more than tripled each month,” adding that it expects that “trend to continue and increase.” The growth pace is hard to rate as we lack a base from which to scale, but we do now have an expectation for future GMV progress from Fast that we can use as a measuring stick.

Fast’s outsized Series B comes after a number of rival online checkout providers have also raised large rounds.

In late December Bolt, which provides online checkout, identity, and payments services raised a $75 million extension to its Series C round. The company also shared a number of growth metrics, allowing TechCrunch to get a handle on its current size, and expectations for future performance.

Then in mid-January Checkout.com raised $450 million at a $15 billion valuation. TechCrunch wrote at the time that “Checkout.com wants to build a one-stop shop for all things related to payments, such as accepting transactions, processing them and detecting fraud.” So, similar to Bolt and in competition with elements of what Fast offers.

Finally, Rapyd announced that it raised $300 million at a $2.5 billion valuation one day later. Rapyd provides fintech services via an API, TechCrunch noted, but as it does support global ecommerce payments and sells anti-fraud tech, it seems to fit inside this group.

Tack on Fast’s new Series B and inside the last month or so we’ve seen $927 million — at least — flow into startups with overlapping ecommerce infrastructure market targets. That’s just under $26 million a day since the Bolt round, an enormous amount of capital in a short period of time.

How are the companies all raising in such rapid-fire fashion? The most obvious answer to the question is that ecommerce is so big, and so critical to the global economy, that improving the experience of vending goods online for both sellers and buyers is a problem space with room for many players. That so many startups in the race to solve online commerce have each raised implies that they are all, so far, enjoying strong growth rates; and that implies a gigantic market into which they all hope to grow.

And it’s hard to argue in the wake of COVID-19 boosting ecommerce, and generally accelerating the digitization of the global economy, that such technologies will be constrained by market size anytime soon.

As the world moves towards remote work, the collaborative tools market continues to expand. Jam, a platform for editing and improving your company’s website, is adding to the trend by introducing a new arm to its product today called Jam Genies.

Jam Genies is a network of highly experienced product experts that Jam users can tap for guidance and advice around their specific issue or challenge.

Cofounder Dani Grant explained to TechCrunch that many small and early-stage companies don’t have the deep pockets to hire a consultant when they run into a challenge, as many charge exorbitant rates and they often have a minimum time requirement. It can be incredibly difficult to get bite-sized advice at a reasonable cost.

That’s where Jam Genies comes in.

Genies hail from a variety of ‘verticals’, such as investors, designers, brand people, and growth hackers. The list includes:

• Brianne Kimmel – Angel investor and founder of Worklife VC. Investor in Webflow, Hopin & 40+ software companies building the future of work.
• Erik Torenberg – Partner at Village Global, a fund backed by Bill Gates, Jeff Bezos, Mark Zuckerberg and others. Founding team at Product Hunt.
• Sahil Lavingia – Founder & CEO of Gumroad, first engineer at Pinterest, and angel investing $10 million a year via shl.vc.
• Iheanyi Ekechukwu – Engineer turned angel investor, and scout investor for Kleiner Perkins.
• Soleio – Facebook’s second product designer, former head of design at Dropbox, and advisor at Figma. Invests in design-focused founders at Combine.
• Dara Oke – Product design lead at Netflix, formerly designed and built products at Microsoft, Twitter, and Intel.
• Katie Suskin – Designed many products you know and love like Microsoft Calendar, OkCupid, Tia, and … Jam.
• Julius Tarng – Helped scale design at Webflow and led design tooling at Facebook.
• Abe Vizcarra – Currently leading brand at Fast, former Global Design Director at Snap Inc.
• Tiffany Zhong – CEO, Zebra IQ. Recognized by Forbes as one of the Top 10 Gen Z Experts.
• Nicole Obst – Former Head of Web Growth (B2C) at Dropbox and Head of Growth at Loom
• James Sherrett – 9th employee at Slack, led the original marketing and sales of Slack.
• Asher King Abramson – CEO at Got Users, a growth marketing platform widely used by startups around Silicon Valley.

Users on the Jam platform can choose a Genie and set an appointment through Calendly. The sessions last half an hour and cost a flat fee of $250, all of which goes to the Genie.

Jam raised $3.5 million in October, from firms like Union Square Ventures, Version One Ventures, BoxGroup, Village Global and a variety of angel investors, to fuel growth and further build out the product. Jam Genies is, in many respects, a growth initiative for the company to better acquaint early-stage startups with the platform.

The main Jam product lets groups of developers and designers work collaboratively on a website, leaving comments, discuss changes and create and assign tasks. The platform integrates with all the usual suspects, such as Jira, Trello, Github, Slack, Figma, and more.

Since its launch in October 2020, the company has signed up 4,000 customers for its private beta waitlist, with 14,000 Jam comments created on the platform. The introduction of Jam Genies could add momentum to this growth push.

It’s been a wild 12 months for fitness platforms, as the world’s population has struggled to adapt to workouts outside of the gym. From Lululemon’s massive Mirror acquisition to companies like Apple and Samsung launching their own solutions, exercise technology has thrived amid the pandemic.

Talent Hack is one of a large (and growing) number of companies looking to make fitness more accessible in a world where the gym just isn’t an option for many. Rather than creating its own front-end, curated platform, however, the New York-based startup’s Spaces is designed to offer a B2C platform for fitness instructors and studios.

This week, the company announced that it has raised a $4.7 million seed round, led by Global Founders Capital. The Fund is also participating in the round, along with Mindbody Online’s Rick Stollmeyer, as well as Lucy Deland, Hannah Bronfman, Amanda Freeman, Ellie Burrows and Amy Klein.

Spaces has been operating with a relatively low public profile since January 2019, though more than 50,000 fitness professions have signed up for the service. The company says it’s managed to help top earners pull in $250,000.

“We are the first fitness and technology company that is a true partner for the individual wellness instructor, facilitating agency and power to the individual in the rising 30% YoY at-home fitness market,” CEO and co-founder Alexandra Bonetti says in a release tied to the news. “Our mission is to empower fitness and wellness professionals with the tools and resources they need to propel and scale their businesses so they can remain focused on what they do best.”

Talent Hack says this round will go toward increasing its marketing, improving the customer experience and expanding recruiting.

As the global pandemic continues, having options for keeping active at home is increasingly top-of-mind. Treadly is a startup focused on building a home treadmill that’s compact and convenient, with smart connected features that boost engagement. The company recently released its second-generation product, and it’s super compact, with hardware improvements that boost the weight limit for users and add cooling benefits that extend workout times.

Basics

Treadly’s design is probably a lot smaller than you’re expecting – it’s just 3.7-inches tall for the base, and it weights just 77 lbs. The whole deck is just 56-inches long by 25-inches wide, and there’s a flip-down handle that you extend when you want to jog at a faster pace, while folding it away for strictly walking workouts.

There’s a display built into the deck itself, offering a simple but easy to read black and white readout of key stats, including speed, total steps, time and distance. The handrail features manual controls, and the Treadly 2 can also be controlled either via a dedicated remote control for the basic model, or through the Treadly app (iOS only now, but Android coming soon) via Bluetooth for the upgraded Treadly 2 Pro version.

The Treadly 2 also features a built-in Bluetooth speaker, which allows you to connect your smartphone and play music via whatever app you want. The Treadly iOS app also offers community iterative training, and live video integration. Treadly is also introducing new groups features to the app to allow users form their own communities, and also new challenges that users can issue to one another, like step count records and more.

Design and features

Treadly’s design is very compact, as mentioned, and it’s the perfect size for small spaces. It’ll slide easily under most couches thanks to its low height, and it can also be stored vertically if you want to put it against the wall or in a larger closet. The design is also attractive and minimal, which make it more unobtrusive than most exercise equipment even if left out in plain view.

The built-in display in the deck itself is a nice accommodation for keeping the dimensions compact, while also providing all the feedback you’d expect from a piece of home gym equipment. It’d be easier to check periodically if it was mounted into the fold-down handlebar, but that would definitely lead to increased bulk. Plus, having the stats slightly difficult to access is probably actually better for many people, since zeroing in on those can make a workout more arduous than it needs to be.

For the basic model, the remote is effective and compact, with a wriststrap included so that you can keep track of it easily while using the treadmill. The built-in Bluetooth speaker isn’t amazing, as you might expect, but it’s more than good enough to provide a soundtrack if you don’t have other speakers or earbuds on hand to use.

Image Credits: Treadly

As for the experience of actually using Treadly 2 to run or walk, it definitely delivers, with a few caveats: First, don’t expect this to provide a true indoor running experience. While it definitely offers impressive weight capacity for a treadmill of this size, the max speed is 5 mph, which is a low-intensity jog for most people. With the handrail down, that drops to just 3.7 mph, which is a brisk walk.

For something this compact, that’s actually still very impressive – especially since there’s no time limit on how long you can use the treadmill at 5 mph thanks to Treadly 2’s new and improved cooling system. For avoiding a sedentary lifestyle while remaining mostly indoors, the Treadly 2’s speed settings more than deliver, and that’s probably enough for most users, advanced fitness buffs excluded.

Bottom line

The Treadly 2 is a connected treadmill that provides a great blend of convenience, social features, guided usage, connected control and space-saving design into a reasonably-priced package starting at $749 for the Basic and $849 for the Pro with special New Year Sale pricing. It’s like the Peloton that most people are actually more likely to use long-term, and it’s a great way to stay active during the long winter months in our unprecedented times.

PepsiCo, the planetary purveyor of sugary drinks, greasy chips, and (weirdly) oatmeal, hummus, and gazpacho(?) is partnering with Beyond Meat, the publicly traded plant-based protein provider, on a poorly named joint venture to hawk new plant-based food and beverages to consumers.

The PLANeT Partnership (which was clearly branded by the same genius behind the comic sans font), will combine Beyond Meat’s skills with protein prestidigitation and PepsiCo’s marketing and manufacturing savvy to flood the global market with new snacks and drinks, the two companies said.

Neither company disclosed any financial terms and other pesky details around who, what, where, and when, except to say that the the joint venture operations will be managed through the newly created PLANeT Partnership.

(If the companies put as much effort into running the business as they did with naming and branding it, Impossible Foods shouldn’t have much to worry about…. The capitalization and branding of this thing is an affront to the English language is all I’m saying.)

“Plant-based proteins represent an exciting growth opportunity for us, a new frontier in our efforts to build a more sustainable food system and be a positive force for people and the planet, while meeting consumer demand for an expanded portfolio of more nutritious products,” said Ram Krishnan, PepsiCo Global Chief Commercial Officer, in a statement.

In the announcement touting the new JV, PepsiCo referred to its storied history of snack innovation including baked LAY’S chips, Sabra Snack Cups, Alvalle ready-to-drink gazpacho, Quaker Breakfast flats and Gatorade Juiced.

The company has also acquired BFY Brands, which makes PopCorners; SodaStream, which makes… well… SodaStreams… and BareSnacks, which makes baked fruit and vegetable chips.

The deal is the latest really really big partnership for Beyond Meat and follows an oddly botched announcement with McDonald’s that the two companies would be collaborating on new menu items.