Author: azeeadmin

Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.

When we kicked off our series on private companies that have reached $100 million ARR, we didn’t expect it to last. Maybe a piece or two, but nothing more. Today’s entry should bring us past the thirty company mark.

It was less than a month ago that we added eight names to the club in a single post (HeadSpin, UiPath, DigitalOcean, BounceX, Wrike, Aeris, Podium and Lucid), the latter two of which had recently raised capital, announcing their revenue milestones at the same time. This morning, we’re appending just three names, but pay attention all the same.

We joked in February that our running tally of growth-oriented, private companies that had reached $100 million in annual recurring revenue read like a list of firms that either could, or should go public in short order. Since then, the IPO market has largely closed in light of COVID-19, so I suppose we’re more adding to the backlog than queuing up companies for an S-1.

Either way, let’s talk about ActiveCampaign, Recorded Future, and ON24 this morning!

New names

We’ll start, then, with Recorded Future .

Recorded Future

Boston-based Recorded Future, a cybersecurity company focused on “threat intelligence,” announced that it crossed the $100 million ARR mark recently, making the firm a success story for its city. But as with so many companies that we add to our list, its inclusion is slightly fraught.

Israeli cybersecurity company CyberArk has acquired identity startup Idaptive for $70 million in an all-cash deal.

CyberArk is one of the shining stars in the Israeli cybersecurity scene before its initial public offering in 2013 saw it go public on the Nasdaq. To date, its share price has almost quadrupled.

At the core of CyberArk’s identity and privileged access management technology is making sure the right people — like corporate employees — can access the right systems and services. Data suggests exposed or breached credentials can account for most data breaches. Having technologies in place that put barriers in place to prevent credential misuse can prevent further damage.

No wonder Idaptive makes for a good fit.

Idaptive, a Santa Clara, Calif.-based startup that spun out from Centrify in 2018, made a name for itself by taking a zero-trust approach to identity security. Zero-trust treats every user the same, whether they’re inside the firewall or not.

In a blog post, CyberArk said the acquisition will bolster its position in the identity management space, allowing its customers to improve their security posture across a multitude of different infrastructures, like hybrid and multi-cloud environments.

“Merging the innovative technology and talents of the Idaptive team with that of CyberArk represents an exciting opportunity to deliver a differentiated, modern approach as we work to continually meet the ever-changing needs of the dynamic threat landscape,” said CyberArk’s chief marketing officer Marianne Budnik.

Loon, the Alphabet -owned company that’s using stratospheric balloons to provide high-speed bandwidth to hard-to-serve areas without strong ground infrastructure, has signed a new deal with carrier Vodacom to expand its offering in Africa to Mozambique. This is the second commercial agreement that Loon has in place in the continent, and its close proximity to Kenya, where its first deal is in place, means that the company will be able to use balloons across both markets.

The way Loon provides internet is by sending balloons to extremely high altitudes, equipped with radio equipment that effectively turns them into floating cellular broadband towers. The stratospheric positioning means they can cover a much wider area than ground-based cell towers, and reach areas where it’s been hard due to costs or accessibility to actually put in ground towers to begin with.

The deal for coverage in Mozambique will work similarly to its arrangement in Kenya, providing access to Vodacom’s customers in Cabo Delgado and Niassa, two provinces in the country. Connectivity simply wasn’t available at all to some of the areas covered under the new agreement, and Loon has already worked with its partners to secure the permissions necessary to fly its balloons over the target coverage areas.

Next up is installing ore ground infrastructure that can help relay the signals needed to ensure consistent connectivity, and Loon will also be test flying its balloons above Mozambique in order to gather the seat necessary for it to train the automated systems that fly them while in operation. Loon’s tech works by training algorithms to determine the best way to navigate stratospheric air currents in patterns that mean the balloons can stay in a relatively stable position over the target coverage area.

As mentioned, the close proximity of Mozambique to Kenya means that Loon will be able to figure out even more efficient ways to share balloons across both areas, so that when they float out of one country’s coverage area, they’ll be able to float into one for the other. That should give you a clue about Loon’s future expansion plans – economically, it makes the most sense for it to pursue partnerships in areas where it can realize even more of these kinds of efficiencies.

As we move through life in the pandemic, companies are being forced to review and understand how workflows happen. How do you distribute laptops to your workforce? How do you make sure everyone has the correct tool set? FortressIQ, a startup that wants to help companies use data to understand and improve internal processes, announced a $30 million Series B investment today.

M12, Microsoft’s venture fund and Tiger Global Management led the round with help from previous investors Boldstart Ventures, Comcast Ventures, Eniac Ventures and Lightspeed Venture Partners. The company has now raised almost $65 million, according to Pitchbook data.

As the product has matured, founder and CEO Pankaj Chowdhry, says its focus has shifted a bit. Whereas before it was primarily about using computer vision to understand workflows, customers are now using that data to help drive their own internal transformations.

That used to require a high priced consulting team to pull off, but FortressIQ is trying to use software, data and artificial intelligence to replace the consultant and expose processes that could be improved.

“We’re building this kind of cool computer vision to help with process discovery, mostly in the automation space to help you automate processes. But what we’ve seen is people leveraging our data to drive transformation strategies, of which automation ends up being a pretty small component,” Chowdry explained.

He said that this is helping define new ways of using the tool they hadn’t considered when they first started the company. “If you think about it, we can use analytics to drive better experiences, better training, all of that. We’ve seen how customers are driving overall improvement strategies by leveraging the data coming out of this system,” he said.

The company currently has 65 employees, but he couldn’t commit to a future number at this point because of the uncertainty that exists in the economy. He knows he wants to hire, but he’s not sure what that will look like. He said they used to revisit hiring every six months. Now it’s ever six weeks, and so they keep having to reevaluate based on an ever-shifting set of conditions.

Chowdry believes that companies will need to be more agile moving forward to react more quickly to changing circumstances beyond the current crisis, and he thinks that’s going to require solid business relationships to pull off.

“I think the idea is to be leveraging this time to build that relationship with your customers so as they do start looking at what are they going to do and where they need to be invested in the business, that we’ve got both the data and the infrastructure to help them do that.”

With November looming, the scramble to protect the 2020 U.S. election from coronavirus chaos is on.

To that end, a small, skilled cluster of voting rights advocates are launching a new voter mobilization project. Called VoteAmerica, the new non-profit shares DNA with Vote.org, the esteemed nonpartisan voter mobilization site VoteAmerica founder Debra Cleaver first launched in 2008.

VoteAmerica’s goal is to boost voter turnout by helping people vote by mail. In a normal year that might mean striving to drive record turnout. But in the midst of the pandemic, the team is working to ensure that 2020’s presidential election turnout doesn’t slump like it would in a midterm election year.

“It seems at this point that Americans are either going to be unable or unwilling to vote in person in the November election, which could lead to catastrophically low turnout,” Cleaver said in an interview with TechCrunch. “But if we have our way, there will be no perceivable dip in turnout in November.”

While Vote.org is still around, the organization severed ties with Cleaver last summer in a drawn out battle with the group’s board. As Recode reported last month, some key Vote.org partners and donors walked out the door with Cleaver—a major concern for an organization with valuable ties in Silicon Valley and a more dire mission than ever in 2020.

With VoteAmerica, they might be back in the picture. Some of Cleaver’s previous Silicon Valley backers include Y Combinator’s Sam Altman (Cleaver is a YC alum), LinkedIn founder Reid Hoffman and angel investor Ron Conway. In a conversation with TechCrunch, Cleaver noted that at least Conway is back on board, pitching in with the $5 million in initial funding—a mix of grants and early contributions—to get the fledgling organization off the ground.

“We have the expertise, the team, the experience, and the plan,” Cleaver wrote in a Facebook post last month, adding that a “generous donor” had already stepped up to cover the nascent organization’s payroll costs.

Cleaver describes VoteAmerica as a lean team with deep experience—and one ready to hit the ground running. The project’s new website VoteAmerica.com fittingly displays an election day countdown clock in stark white-on-red lettering to convey the urgency of its task.

In the announcement for the new project, Cleaver said she believes that the 2020 elections “will be the most chaotic in American history”—a prediction that unfortunately is very difficult to argue with.

“Chaos driven by a global pandemic, foreign interference, threats of political violence, a radicalized electorate, a virulent campaign of disinformation, and fragile election administration technology all combine to make voting in person more difficult and less secure than ever before,” Cleaver said.

Because states conduct elections in the United States, her group’s core mission is to shepherd voters through the national patchwork of voting registration systems. On the simple site, visitors can register to vote, check their registration status, find a polling place, request an absentee ballot or sign up to vote-by-mail.

While many states in the U.S. already administer a large chunk of their voting through absentee vote-by-mail, It looks likely that the urgent public health threat posed by the coronavirus will mean that mass public gatherings in crowded polling places remain unwise. In light of that threat, states are looking to dramatically scale up those systems now to get them ready in time for November.

Old systems, new solutions

For VoteAmerica, navigating the quirks of American election systems can look like lending voters a fax machine.

“You can only sign up [for a mail-in ballot] online in 15 states, which is not actually a significant number, but there’s another 15 more where you can fax in your form, which doesn’t seem relevant because it’s 2020 and who uses a fax machine?”

But using fax APIs, VoteAmerica is building out a system that allows voters to request a vote-by-mail application just by taking a photo of their signature. VoteAmerica’s tool then uses code to put the signature in the right spot on the form and then programmatically faxes it to the relevant local election official.

“This is kind of wonky because we’re using truly antiquated technology to modernize the vote-by-mail process,” Cleaver said. “But if you have a mobile device—and 87% of Americans have a smartphone—we’re building technology that lets you sign up directly from your mobile device without printing and mailing.”

It’s just one way that VoteAmerica plans to employ technology solutions to civic problems—like the outdated government systems that still haunt American life. The solution sounds small, but at scale it can mobilize a huge amount of voters who otherwise could have been tangled up in the bureaucratic process. Naturally, that kind of elegant workaround to inefficient systems attracts interest from the tech community.

“We definitely do get a lot of tech money, and I think it’s because tech people both appreciate and trust using technology to clear antiquated hurdles,” Cleaver said.

“The things that we do, people in Silicon Valley are very receptive to it, whereas people outside the Valley might take a little more time to warm up to it.”

Even in these trying economic times, there are some services that companies can’t do without. Having good security tools is one of them. Expel, a 4-year old startup that offers security operations as a service, announced a $50 million Series D financing today.

CapitalG led the round with participation from existing investors Battery Ventures, Greycroft, Index Ventures, Paladin Capital Group and Scale Venture Partners. The company has now raised almost $117 million, according to Pitchbook data.

It’s never easy finding quality security talent to help protect a large organization. The idea behind Expel is to give customers a set of tools to help use automation to reduce the number of people required to keep an organization safe.

Most companies struggle to find experienced security employees, so it’s using automation to solve a real pain point for them. While co-founder and CEO Dave Merkel says you still need to staff the security operations center, you can do it with fewer people with his platform.

“You may have a 24×7 Security Operations Center, but you don’t need the number of people everybody else does to protect your customers because Workbench does all of the heavy lifting for you. So instead of a SOC with 100 people, maybe you’ve got one with 15 people, and that gives tremendous leverage through this platform, and the platform ensures that you can provide high quality security without having to continually grow headcount,” Merkel explained.

Merkel sees the same economy everyone else does, but he believes that companies will continue to invest in security because they have to.

“Security tends to be a need as opposed to a want in many organizations, and so we still do see business happening. We will be using some of the money to continue to invest smartly in sales and marketing, but we’ll just need to be deliberate to make sure that we’re picking the right things that are still effective right now,” he said.

One thing that’s remarkable about this round is that Expel didn’t go looking for this new money. In fact, CapitalG came knocking, according to CapitalG general partner Gene Frantz.

“We sought out Expel, first and foremost. It wasn’t that Expel sought out to raise money and they called a bunch of people. We called them, and that was in response to a bunch of thematic work that we continually do in the security space,” Frantz told TechCrunch.

That work involved three main areas, where Expel happened to check all the boxes. The first was the threat landscape becoming ever more treacherous. The second was information overload from a variety of security products, and finally the dearth of experienced security personnel to deal with the first two problems.

“And so our bet is that this is the company in the space that actually will take on and address these challenges,” Frantz said.

Merkel describes having a company like CapitalG come to him as a humbling experience for him and his co-founders, especially under the current circumstances.

“It’s tremendous validation, but it is also humbling. We’re pretty thankful to be in that position, and we want to make sure that we do the right things to continue to honor the opportunity that we see in front of us.”

As millions of students and teachers shift to learn from home in response to the novel coronavirus disease, modern-day flashcard business Quizlet has raised $30 million in a Series C round led by General Atlantic.

Quizlet’s chief executive officer Matthew Glotzbach said that the new funding values the business at $1 billion, up five times from its last funding round in 2018. Quizlet’s total known financing is more than $60 million.

The fresh funding comes off the heels of unprecedented usage for Quizlet, which connects students to virtual flashcards and study guides. Once a user makes a guide, they can share a unique link with friends and collaborate ahead of a test. School shutdowns due to COVID-19 have caused students to flock to the platform as they look for new ways to study, retain information and collaborate.

Students ask over 1 billion questions on Quizlet each week and more than 400 million virtual study guides have been created. The San Francisco-based startup is also seeing “massive international growth,” with 200% to 400% new user growth across its top international markets.

The company declined to share daily numbers, but said it sees over 50 million users every month, which is similar to a statistic it shared two years ago.

Glotzbach noted that more than two-thirds of high schoolers in the United States use Quizlet. At least half of U.S. college students have used the platform. That kind of market hold only comes from two aspects: volume and variety. The site’s curriculum spans from acid and bases in chemistry to the science of roller coasters to the art of sensation and perception.

As for why a flash card business could be worth a billion dollars, it isn’t. But an AI-powered tutoring platform could be, and that’s exactly what Quizlet is focusing on as a core product move in the foreseeable future. Quizlet Learn, Glotzbach says, is the most popular feature on the site and uses AI to help users study topics and learn mastery by a certain time.

Quizlet’s newest investor, General Atlantic, has invested in a number of edtech companies around the world, like OpenClassrooms, Ruangguru, Unacademy and, recently, Duolingo. Glotzbach said that Quizlet will continue to expand to new international markets, but does not have any “specific targets or names.” It is currently used in 130 countries across 19 localized languages, so it has a lot of room to grow.

Quizlet did not comment on profitability, but said its revenue is growing 100% year over year.

Quizlet views its closest competitor as Chegg, an online textbook company that went public in November 2013. Glotzbach says it has a larger audience and bigger footprint on education in the United States. He noted that other learning apps like Duolingo are vertical and subject focused, while Quizlet has a more broad curriculum.

While the new funding officially makes Quizlet a unicorn, Glotzbach said that when he announced the funding to his staff he compared the company more closely to a camel.

“We’ve built a very large-scale business with products that are easy to use, easy to get up and running and easy to share,” he said. “We use a low-cost subscription model that is very inexpensive so we get a lot of people upgrading to our premium product, and it drives economic business.”

Slow and steady is part of its founding story: Quizlet was founded in 2005 by a 15-year-old, Andrew Sutherland. It was fully bootstrapped until 2015. Glotzbach, who was previously an executive at YouTube, then joined in 2016.

But while it has humble roots, this new round was closed in the heat of a global pandemic.

“We saw record drops in the stock market multiple days in a row while trying to both manage [the round] and move an entire company to remote work,” he detailed. “It was closed during such a volatile time.”

Glotzbach said that the round was more opportunistic, and that it didn’t “need an injection of capital to make ends meet.”

Therefore, Quizlet’s new shiny valuation is yet another example of how edtech has found both revitalization and green shoots during this catastrophic time, and how remote learning is going from a tool to a necessity for many learners.

Rocket Lab is already in the testing phase for a new engine it’s building to propel its forthcoming Photon Lunar spacecraft, according to CEO and founder Peter Beck . Beck shared an image of the engine, called hyperCurie, undergoing tests conducted by the company’s propellant team.

HyperCurie, as its name implies, is an evolution of the Curie engine that currently powers the third stage of the Electron rocket that Rocket Lab uses for its missions, as well as the Photon satellite bus. The hyperCurie will power the forthcoming Photon Lunar, which is a new satellite bus being developed by Rocket Lab to carry small payloads to the Moon, Mars, Venus and even beyond.

Rocket Lab was awarded a contract to launch a payload to the Moon on behalf of NASA back in February, and it clearly sees more opportunity in delivering small satellites both to lunar orbit and to other deep space destinations on behalf of the agency as well as other clients. The NASA lunar mission will be a precursor to the agency’s ultimate goal of building and deploying a Lunar Gateway orbital station near the Moon, which will be a key element for future Moon exploration and long-term human missions.

Beck previously shared a detailed wireframe schematic drawing of Photon Lunar at the beginning of this month, showing the forthcoming spacecraft with the hyperCurie engine attached. HyperCurie uses electric pumps, unlike the pressure-fed Curie, to improve its peformance and produce more thrust.

Rocket Lab’s lunar delivery mission for NASA is set to take place in 2021 based on current timelines, so it makes sense that the engine would already be ar enough along to be in the active testing phase.

I’ve been following the Nura story since the Australian startup brought an unfinished prototype of its first headphones to our offices four years back. When I finally had the opportunity to review the Nuraphones the following year, I put the noise-adapting headphones at the top of my list of 2017’s best gadgets.

There was a lot to like about the product, which was clearly lovingly crafted, right down to the packing material it shipped in. The build quality was great, the app was well-designed and the custom audio fingerprinting felt downright revolutionary for home audio listening. There was, however, one thing I and everyone else who reviewed the original asked: why not earbuds?

One of the more peculiar things about the Nuraphones is that the sound was largely contained in a pair of earbud-style nubs that sit inside over-ear cups. The cups, meanwhile, largely existed to deliver a more immersive bass experience. But while bass is no doubt an essential part of music listening, it’s something many manufacturers have used to overcompensate for other shortcomings. Heck, that was Beats’ whole M.O. in the first place.

For me, the bass cups always felt like an interesting but inessential aspect of the experience. One of my earliest pieces of feedback to Nura was the fact that I would have happily traded it for something more portable. NuraLoop earbuds were finally unveiled at CES 2019 — albeit as dummy units. Now, a year-and-a-half later, they’re finally shipping.

As with their predecessors, it’s clear a lot of thought went into the product here — a marked benefit of being a startup that has thus far produced two products in five years. Once again, even the packaging is nice here — albeit less elaborate. They also ship with a lovely little leather pouch — good for carting around both the headphones and their accessories.

Rather than going fully wireless — as is the trend of the day — the Loops are tethered. This serves a number of purposes, perhaps most important of which is an included magnetic adapter that turns them into hardwired headphones.

I suspect the feature will have limited applications for most users, as smartphones have largely abandoned the headphone jack. When the product was announced, CEO Dragan Petrovic told me the accessory was included for professional musicians who had asked for a hardwired version of the product to serve as stage monitors. It’s a niche category of user, naturally, but I appreciate the inclusion nonetheless as someone who uses hardwired headphones to edit my podcast on the fly.

The ability to snap two pieces together and plug into my MacBook is fantastic.The charger also takes advantage of the magnetic adapter. Once snapped in place, a white light will begin glowing softly to let you know it’s working. Ten minutes of charge should get you about two hours of battery. Fully charged, you should get more than a day’s worth of listening (rated at 16 hours), a nice benefit of the tethered design.

The buds themselves use an over-ear loop to stay in place — displacing a bit of the strain from their relatively large size, as well. I did start to find them a bit uncomfortable after wearing them for an extended period. Obviously ear sizes are a bit like snowflakes and your mileage may vary. The buds ship with three sizes of removable silicone tips, which are a bit shallower than the standard version.

Fit is always important for a pair of earbuds, but even more so here. The company’s app needs a perfect seal to do its audio profile readings. Thankfully, unlike the original Nuraphones, I was able to get the fit working pretty quickly here. The original models are pretty frustrating to get working. The whole process takes a few seconds, vibrating the hair cells within your ear, which then send back an ”otoacoustic emission.” Once done, you have a customized profile, including a visualization of your hearing.

And once again, the headphones sound great. It’s remarkable what the company’s technology is able to do, building one of the best sound set of Bluetooth earbuds around. Music sounds fuller on the NuraLoop buds. There are subtle artifacts you miss on less sophisticated headphones — and likely enough details you may not have heard in familiar pieces of music. The bass is certainly less intense than on the over-ear models, but it’s still rich and fun. Better yet, it’s adjustable.

Each ear has touch control. Running your fingers around the dial on the right adjusts the volume and on the left, noise canceling/social mode. The noise cancellation leaves something to be desired, versus a product like the AirPods Pro, so if that’s your main concern, look elsewhere. I also found the connectivity to be a little spottier than other models when attempting to walk into another room.

Those complaints are fairly minor though, for what’s a really great little package. You get a lot for $199 here. Nura missed out on quite a bit of potential market by waiting this long to release its first fully wireless earbuds. The space has grown a lot more mature — and crowded — since the company was founded in 2015. But if waiting meant getting the product right, I can’t complain.

And even with a crowded market, there’s still nothing else out there that’s quite like the NuraLoop buds. The underlying technology is excellent, and it’s wrapped up in a well-thought-out package. I suspect the Australian startup is a prime candidate for acquisition from some giant headphone maker eager to get its hands on the tech. For now, however, it’s great to have a unique startup that’s still able to turn the industry on its ear.

Rakuten, often referred to as the “Amazon of Japan” with extensive holdings in e-commerce and streaming media, has made an acquisition that will help it build up and flex a newer arm of its business: communications services. Today, the company announced that it is buying Innoeye, an engineering company based out of Herndon, VA, with offices also in India, which builds cloud-based solutions aimed at carriers and enterprises to manage networks and deploy services across them. The financial terms of the deal were not disclosed.

Rakuten and Innoeye — which was privately held, and didn’t appear to have outside investors — already had a relationship. The Japanese company has been working with Innoeye in its bid to build and operate Rakuten Mobile, a new 4G and 5G mobile network in Japan that launched in April to go head to head with Docomo and others. Rakuten Mobile projects it will have 3 million customers by the end of this year but its losses are mounting in the meantime.

That is not the only area where Innoeye will be active, though. Rakuten Mobile is part of a newer business unit called Rakuten Communications Platform, and a Rakuten spokesperson confirmed today that while Innoeye will continue to support Rakuten Mobile, it will also be selling its services globally to carriers and enterprises.

Innoeye has around 500 employees, so this presumably will also mean that current customers of Innoeye will continue to remain so, although the company has never disclosed who those customers might be.

We typically think of traditional carriers are the key holders when it comes to building and operating mobile and other communications networks, but newer generations of technology, new regulations, and new customer demands have turned that premise on its head.

Carriers might still account for the vast majority of traffic, but these days it’s become much easier for enterprises to build these — for example, to run machine-based IoT systems, or to better manage fleets of workers or customers — and for new entities to emerge to take on carriers at their own game, or at least (thanks to apps and other over-the-top services) nab a decent proportion of services revenue away from carriers.

That is the opportunity that Innoeye has been targeting, and that Rakuten is also trying to capitalise upon. And that is because — as Amazon has done with voice-based home hubs and AWS — Rakuten is focused on finding its own window of opportunity to expand beyond, or capitalise further on, its existing business, using its own economies of scale to get there.

“Since we first envisioned the launch of Rakuten Mobile two years ago, we have also planned to bring to market our own expertise and technology stack as a unique service that will enable operators around the world to deploy fully cloud-native telco networks of the future,” said Tareq Amin, Representative Director, Executive Vice President and CTO of Rakuten Mobile, in a statement. “With the planned acquisition of Innoeye, we are one step closer to closing the circle in bringing to market a carrier grade telco cloud product that is as simple as click, purchase and deploy.”

The services that Rakuten plans to offer through RCP is pretty extensive. It includes cloud-based OSS components to run carrier networks; the necessary hardware and software to run 5G networks on behalf of clients; infrastructure to provide communications services; and a multi-vendor “marketplace” of apps aimed at telcos and enterprises that run their own networks.

“Innoeye is delighted by the opportunity to become part of the Rakuten Mobile family,” said Rajeev Gupta, CEO of Innoeye. “Joining hands with Rakuten Mobile will provide us with unique ability to contribute towards this large industry movement and create a highly innovative cloud-based communication platform that is open, scalable and highly secure. Rakuten Communications Platform will disrupt the industry and pave the way for the next level of innovation. We look forward to being a part of this journey.”

The company’s acquisition of messaging app Viber several years ago initially might have looked like a way to expand the company’s e-commerce ambitions — and indeed it has built links within Viber for that purpose — but now, you could also see that deal as its first foray into providing text, video and voice communications services, an area it is now expanding with a more concerted business unit.