Author: azeeadmin

Blackstone is acquiring a majority stake in Bangalore and San Francisco-headquartered edtech startup Simplilearn for $250 million.

Simplilearn operates an eponymous online bootcamp to help people learn data science, AI, machine learning, cloud computing and other skills that are in demand in the market.

The startup has partnerships with several universities and colleges including IIT Kanpur, Caltech, and Purdue University and students enrolling and completing these courses get a certificate from these institutes.

The 11-year-old startup, which runs 1,000 live classes each month, says it has helped over 2 million professionals and 2,000 companies including Facebook, Microsoft, Amazon across 150 countries.

The startup, which was last valued at $80 million in its 2016 Series C funding round, counts Brand Capital, Kalaari Capital, Helion Venture Partners, and Mayfield among its early backers. It had raised about $34.4 million prior to today’s deal, according to insight platform Tracxn.

Kalaari Capital, Helion Venture Partners and Mayfield Fund have taken exit as part of the new transaction but the leadership team of Simplilearn haven’t sold their stakes, according to a person familiar with the matter.

“The pandemic has only accelerated the need for digital skills and the industry has demonstrated absolute readiness for upskilling online. Hence, this is the most opportune time to take the next big leap in our journey to build the world’s largest digital skilling company,” said Krishna Kumar, founder and chief executive of Simplilearn, in a statement.

“We believe Blackstone can add significant value to our company because of their scale, commitment to building businesses, and global network, which will enable us to develop partnerships with businesses and universities as Simplilearn continues to expand around the world.”

The acquisition comes months after Blackstone-backed Aakash Education Services, which runs coaching centres across the country, was acquired by Byju’s — India’s most valuable startup — for nearly $1 billion. Blackstone has since also made an investment in Byju’s.

“This is Blackstone’s first private equity investment in Asia in a consumer technology company. […] We are excited to partner with Krishna Kumar and Simplilearn’s top-notch management team to accelerate growth and build the world’s pre-eminent digital learning company, and we expect this to be the first of many such investments in Asia,” said Amit Dixit, head of Asia for Blackstone, in a statement.

Temasek and Falcon Edge Capital have led a $220 million investment in Indian omni-channel eyewear retailer Lenskart, valuing the Bangalore-based startup at $2.5 billion.

The new investment, which includes primary and secondary transactions, is part of a new round Lenskart unveiled a month ago when it raised $95 million from global investment fund KKR. Bay Capital and Chiratae also participated in the new round.

Peyush Bansal, founder and chief executive of Lenskart, said the profitable startup — which sells eyeglasses and contact lenses online and through about 750 physical retail outlets across the country — has seen a surge in sales of eyewear products in the pandemic year.

The startup, which counts SoftBank among its investors, sold about 8 million pairs of eyewear last year.

Now the firm, which claims to lead the market in India, plans to scale its operations in Southeast Asia and Middle East. The combined market opportunity for eyewear in these regions will be about $15 billion by 2025, the startup said, citing its own projections.

“We’re already the largest eyewear player in India and in the top 3 in Singapore. Lenskart envisions to have 50% of India wearing its specs over the next 5 years and become the #1 eyewear platform in Southeast Asia and Middle East over the next 18 to 24 months through organic and inorganic expansion,” he said.

According to industry estimates, more than half a billion people in India are affected by poor vision and need eyeglasses, but only 170 million of them have opted to get their vision corrected.

The firm also plans to deploy some capital to broaden its technology stack to create a more personalized experience for its customers. The startup, which recently launched ‘Lenskart Vision Fund,’ said it is also looking to invest in other younger firms that are operating in eyewear, eyecare and omnichannel retail spaces.

“We are thrilled to join Peyush and his team in this journey and look forward to working closely with Lenskart’s team in helping them scale their business internationally, especially in the MENA region” said Navroz Udwadia, co-founder and partner at Falcon Edge Capital, in a statement.

The new investment comes at a time when Indian startups are raising capital at a record pace and a handful of mature firms are beginning to explore the public markets. Zomato raised $1.3 billion last week in the country’s first consumer tech IPO in a decade.

Paytm, the pioneer digital payments startup, as well as its rival Mobikwik also filed for IPOs last week.

Zoom is taking advantage of the impressive rise in its stock price in the past year to make its first major acquisition. The popular video conferencing firm, which was valued at about $9 billion at its IPO two years ago, said Sunday evening it has agreed a deal to buy cloud call centre service provider Five9 for about $14.7 billion in an all-stock transaction.

20-year-old Five9 will become an operating unit of Zoom after the deal, which is expected to close in the first half of 2022, the two firms said.

The proposed acquisition is Zoom’s latest attempt to expand its offerings. In the past year, the video conferencing software has added several office collaboration products, a cloud phone system, and an all-in-one home communications appliance.

The acquisition of Five9 will help Zoom enter the “$24 billion” market for contact centers, the company said.

“We are continuously looking for ways to enhance our platform, and the addition of Five9 is a natural fit that will deliver even more happiness and value to our customers,” said Eric S. Yuan, founder and chief executive of Zoom, in a statement.

Joining forces will offer both firms “significant” cross-selling opportunities in each other’s respective customer bases, the two firms said.

“Businesses spend significant resources annually on their contact centers, but still struggle to deliver a seamless experience for their customers,” said Rowan Trollope, chief executive of Five9.

“It has always been Five9’s mission to make it easy for businesses to fix that problem and engage with their customers in a more meaningful and efficient way. Joining forces with Zoom will provide Five9’s business customers access to best-of-breed solutions, particularly Zoom Phone, that will enable them to realize more value and deliver real results for their business. This, combined with Zoom’s ‘ease-of use’ philosophy and broad communication portfolio, will truly enable customers to engage via their preferred channel of choice.”

The two firms will do a joint Zoom call Monday to share more about the transaction.

While working as the chief operating officer of a pizza chain in Vietnam, Taku Tanaka saw how difficult it is for restaurants to connect with farmers. Many small F&B businesses can’t buy in large volumes, so they rely on nearby markets or multiple suppliers who only sell one category. In turn, this means farmers are disconnected from the end customers of their products, making it hard to predict selling prices or plan their crops. Tanaka founded Kamereo, B2B platform with its own warehouse and last-mile delivery network, to focus on those problems.

Based in Ho Chi Minh City, the company announced today that it has raised $4.6 million co-led by food conglomerate CPF Group, Quest Ventures and Genesia Ventures. The capital will be used for hiring, building a new warehouse management system, user interface upgrades and expanding into Hanoi next year.

Before founding Kamereo in 2018, Tanaka was COO of Pizza 4Ps, which grew from one location in Ho Chi Minh City when he joined to 10 stores three years later (it now has more than 30 locations in Vietnam).

Kamereo works with about 15 farmers, including cooperatives, and serves more than 400 active customers, ranging in size from family-owned restaurants to chains with more than 20 locations. Despite COVID-19 related movement restrictions and temporary business closures, Kamereo says it has grown by 15% every month over the last 12 months. It currently has about 100 employees.

F&B businesses use the platform to order from multiple farmers. Kamereo handles supplier negotiations, order processing and management, and fulfillment. Tanaka told TechCrunch that the company operates its own warehouses and last-mile delivery network because it is cheaper than working with third-party providers.

One of Kamereo’s warehouses for fresh farm products

Most of Kamereo’s last-mile deliveries are done by motorbikes since Vietnam has many small roads that are inaccessible to trucks. Tanaka said one drawback is how many goods can be delivered in one trip. Since drivers need to make multiple trips each day, Kamereo plans to expand its micro-warehouse network in Ho Chi Minh City so they don’t need to travel long distances. Its tech team is also building an internal system to manage inventory, fulfillment and last-mile deliveries with the goal of minimizing variable costs.

In a statement about the investment, Quest Ventures partner Goh Yiping said, “Kamereo sites in one of the largest food production hubs of Southeast Asia, and there is much room to grow in solving many of the inefficiencies of the supply chain today, improving farmers’ livelihood outcomes and procuring the best products for businesses and homes.”

Several weeks ago, the Linux community was rocked by the disturbing news that University of Minnesota researchers had developed (but, as it turned out, not fully executed) a method for introducing what they called “hypocrite commits” to the Linux kernel — the idea being to distribute hard-to-detect behaviors, meaningless in themselves, that could later be aligned by attackers to manifest vulnerabilities.

This was quickly followed by the — in some senses, equally disturbing — announcement that the university had been banned, at least temporarily, from contributing to kernel development. A public apology from the researchers followed.

Though exploit development and disclosure is often messy, running technically complex “red team” programs against the world’s biggest and most important open-source project feels a little extra. It’s hard to imagine researchers and institutions so naive or derelict as not to understand the potentially huge blast radius of such behavior.

Equally certain, maintainers and project governance are duty bound to enforce policy and avoid having their time wasted. Common sense suggests (and users demand) they strive to produce kernel releases that don’t contain exploits. But killing the messenger seems to miss at least some of the point — that this was research rather than pure malice, and that it casts light on a kind of software (and organizational) vulnerability that begs for technical and systemic mitigation.

I think the “hypocrite commits” contretemps is symptomatic, on every side, of related trends that threaten the entire extended open-source ecosystem and its users. That ecosystem has long wrestled with problems of scale, complexity and free and open-source software’s (FOSS) increasingly critical importance to every kind of human undertaking. Let’s look at that complex of problems:

• The biggest open-source projects now present big targets.
• Their complexity and pace have grown beyond the scale where traditional “commons” approaches or even more evolved governance models can cope.
• They are evolving to commodify each other. For example, it’s becoming increasingly hard to state, categorically, whether “Linux” or “Kubernetes” should be treated as the “operating system” for distributed applications. For-profit organizations have taken note of this and have begun reorganizing around “full-stack” portfolios and narratives.
• In so doing, some for-profit organizations have begun distorting traditional patterns of FOSS participation. Many experiments are underway. Meanwhile, funding, headcount commitments to FOSS and other metrics seem in decline.
• OSS projects and ecosystems are adapting in diverse ways, sometimes making it difficult for for-profit organizations to feel at home or see benefit from participation.

Meanwhile, the threat landscape keeps evolving:

• Attackers are bigger, smarter, faster and more patient, leading to long games, supply-chain subversion and so on.
• Attacks are more financially, economically and politically profitable than ever.
• Users are more vulnerable, exposed to more vectors than ever before.
• The increasing use of public clouds creates new layers of technical and organizational monocultures that may enable and justify attacks.
• Complex commercial off-the-shelf (COTS) solutions assembled partly or wholly from open-source software create elaborate attack surfaces whose components (and interactions) are accessible and well understood by bad actors.
• Software componentization enables new kinds of supply-chain attacks.
• Meanwhile, all this is happening as organizations seek to shed nonstrategic expertise, shift capital expenditures to operating expenses and evolve to depend on cloud vendors and other entities to do the hard work of security.

The net result is that projects of the scale and utter criticality of the Linux kernel aren’t prepared to contend with game-changing, hyperscale threat models. In the specific case we’re examining here, the researchers were able to target candidate incursion sites with relatively low effort (using static analysis tools to assess units of code already identified as requiring contributor attention), propose “fixes” informally via email, and leverage many factors, including their own established reputation as reliable and frequent contributors, to bring exploit code to the verge of being committed.

This was a serious betrayal, effectively by “insiders” of a trust system that’s historically worked very well to produce robust and secure kernel releases. The abuse of trust itself changes the game, and the implied follow-on requirement — to bolster mutual human trust with systematic mitigations — looms large.

But how do you contend with threats like this? Formal verification is effectively impossible in most cases. Static analysis may not reveal cleverly engineered incursions. Project paces must be maintained (there are known bugs to fix, after all). And the threat is asymmetrical: As the classic line goes — blue team needs to protect against everything, red team only needs to succeed once.

I see a few opportunities for remediation:

• Limit the spread of monocultures. Stuff like Alva Linux and AWS’ Open Distribution of ElasticSearch are good, partly because they keep widely used FOSS solutions free and open source, but also because they inject technical diversity.
• Reevaluate project governance, organization and funding with an eye toward mitigating complete reliance on the human factor, as well as incentivizing for-profit companies to contribute their expertise and other resources. Most for-profit companies would be happy to contribute to open source because of its openness, and not despite it, but within many communities, this may require a culture change for existing contributors.
• Accelerate commodification by simplifying the stack and verifying the components. Push appropriate responsibility for security up into the application layers.

Basically, what I’m advocating here is that orchestrators like Kubernetes should matter less, and Linux should have less impact. Finally, we should proceed as fast as we can toward formalizing the use of things like unikernels.

Regardless, we need to ensure that both companies and individuals provide the resources open source needs to continue.

Relevance is often tied to rarity. As a result, the first anything — whether a birthday, scientific feat or female vice president — comes with its own weight. Whether that pressure is warranted is a discussion in and of itself, but today, we’ll focus on the ripple effects of India’s first unicorn IPO: Zomato.

Food delivery startup Zomato, set to start trading public shares next week, has been labeled by journalists and industry experts as India’s biggest tech public offering to date. The company could be valued at up to $8.6 billion in its public debut, and early indications of investor interest were strong. 

As my colleagues Alex Wilhelm and Anna Heim put it in their column, the eventual performance of Zomato will be watched by Paytm and MobiKwik, two Indian fintech unicorns also looking to go public soon, the some 100 Indian unicorns, and, of course, returns-focused venture capitalists. The success of the startup could lead to more venture funding, exits down the road, and overall, highlight a milestone for growth investments amid legislative and regulatory tension. 

While the pressure is on for Zomato not to get squashed by the public markets, it’s not simply baseless, anticipatory energy. Our on-the-ground reporter Manish Singh has religiously reported on all the signs that India has been building toward this event, from the early-stage startup fundraising frenzy to how engineers suddenly feel empowered to ask for more money thanks to an increase in demand.

A Zomato success may turn more investors to pay attention to the startup scene, but they will be playing catch-up: Indian startups have raised a record $10.46 billion in the first half of 2021, up from $4 billion during the same period last year, and $5.4 billion in the first half of 2019, data insight platform Tracxn told TechCrunch. For comparison, Indian startups had raised $11.6 billion in all of 2020.

The takeaway here, both in life and in startups, is that the first anything is rarely a result of a single decision. Often, if you look closely, a massive milestone is due to an amalgamation of different wins, successes, failures, and tinier milestones along the way. This doesn’t take away its title as the biggest tech startup to go public in India (relevant, and rare!) but it does suggest that ripple effects aren’t just a side effect of a financing event, but maybe the impetus of the IPO in the first place.

In the rest of this newsletter, we’ll get into emerging fund manager trends, as well as funding round advice that has nothing to do with closing a round. You can find me on Twitter @nmasc_ or listen to me as a co-host on Equity.

Emerge, then converge

Image Credits: Bryce Durbin/TechCrunch

The clip of closed funds led by diverse, emerging fund managers is unlike anything I’ve seen before. In the last week, Female Founders Fund closed $57 million for Fund III, Nasir Quadree announced one of the largest solo GP funds, Peter Boyce II is nearing a $40 million close for Stellation Capital and H Ventures landed a $10 million debut fund.

Here’s what to know: More and more established venture firms are turning to emerging managers for deal flow, and frankly, new partners, per my colleague Connie Loizos. Just this week, Initialized Partner scooped up Parul Singh from Founder Collective, making her a new partner at the firm. Don’t expect the trend to slow down anytime soon.

Your funding round isn’t special, but you may be

Image Credits: Mohd Hafiez Mohd Razali/EyeEm (opens in a new window)

It may be easier to fundraise than it is to secure fundraising coverage. As we talked about in our recent Equity podcast, featuring special guest Forbes Senior Editor Alex Konrad, the bar for “the funding round story” has never been higher.

Here’s what to know: In order to stand out, founders need to be transparent about competition, their industry and leave those godforsaken preapproved quotes and talking points. We get into specific advice on the show, and how a numbing effect could hurt historically overlooked individuals.

For more fundraising advice:

• Norwest’s Lisa Wu explains how to think like a VC when fundraising
• Cleo Capital’s Sarah Kunst explains how to get ready to raise your next round

Around TC

• The TechCrunch Disrupt Agenda just went live. It’s a must-read line up and a must-attend event.
• Have you ever taken a cohort-based course from an edtech platform? I’m writing a story, so please e-mail if you’re open to chatting about your experience at one.
• Shout out to Christine Hall for recently joining the TechCrunch team. Follow her on Twitter. I’ll wait!

Across the week

Seen on TechCrunch

• New York City’s new biometrics privacy law takes effect
• Crypto investors like Terraform Labs so much, they’re committing $150 million to its ‘ecosystem’
• Blue Origin’s final passenger for its first human spaceflight will be 18-year-old Oliver Daemen
• The case for funding fusion

Seen on Extra Crunch

• Outdoorsy co-founders detail how they expanded the sharing economy to RVs
• How to navigate an acquisition without alienating your current employees
• 5 advanced-ish SEO tactics to win in 2021
• Dear Sophie: Tell me more about the EB-1A extraordinary ability green card
• How to make the math work for today’s sky-high startup valuations

Thanks for reading along, everyone. Have a good weekend, and if you liked this newsletter, make sure to share it with at least one friend!

N

Welcome back to The TechCrunch Exchange, a weekly startups-and-markets newsletter. It’s inspired by what the weekday Exchange column digs into, but free, and made for your weekend reading. Want it in your inbox every Saturday? Sign up here. 

Friends! Hello and thanks for dropping by. Today we have lots of our usual fare: Funding rounds to digest, some data on the startup market (thank you, DocSend), and the like. But we’re starting with a passion of mine: Racing.

The Exchange has made various jokes about technology money finding its way into the Formula One world this year. Companies like Splunk and Webex and Microsoft and Zoom and Oracle and others are sponsoring teams, races and the league itself.

One particular F1 partner of note is Amazon. Its public cloud project, AWS, has powered on-screen graphics for the sport, for example. Sure, sometimes fans wonder precisely how the group’s compute clusters are coming up with certain metrics, but AWS’ notes on tire wear are useful and timely.

It turns out, however, that behind the scenes Amazon has been more active in the F1 world than I had previously understood. In short, the tech-and-F1 money story that we’ve discussed was just a piece of a larger puzzle. How so? It turns out that AWS was key to the design process of F1’s new 2022 car.

It looks like this:

Image Credits: Formula One

Pretty neat, yeah?

I’ll bet you are wondering why it is so swoopy. The answer to that is that the car is designed with some very specific aerodynamic goals in mind. Like reducing something called “dirty air,” a phenomenon when the wind flying off the back of an F1 car makes the car following it struggle to stay on the track.

Today’s F1 cars — we’re in the midst of the last season with the current generation of Formula One hardware; let’s go Lando! — generate lots of dirty air. Which makes for somewhat awkward racing as the cars on the track can’t get too close to one another for fear of losing their all-important downforce. You know, the stuff that keeps the cars on the tarmac and not in the wall.

To design a base car that will do what F1 wanted for its next era of competition, namely cut dirty air and allow for more close racing, a lot of computing effort had to go into computational fluid dynamics, or CFD. And it turns out that AWS handled the computing needs of the racing group.

The Exchange got on Amazon Chime — our first time on the platform, we might add — to chat with F1’s Rob Smedley, its director of Data Systems, to chat about how it all came together. Per the former Ferrari and Williams engineer, the racing org and Amazon have been working on the new car project since 2018. F1 has lots of in-house brains to handle its own side of the affair, while Amazon provided thousands of cores to do all the tricky math.

According to Smedley, if his team had used the same computing power that individual F1 teams are allowed — the sport of Formula One racing is replete with regulations designed to help keep teams on a somewhat equal footing, or to hold Mercedes back, depending on your perspective — it would have taken four days per compute cycle to model two of the new cars driving one behind the other.

But with Amazon providing 2,500 compute cores, Smedley and the data boffins at F1 could get the same work done in six or eight hours. That means that the group could run more simulations and design a better car. At times they absorbed even more compute, with the data director telling The Exchange that at one point last year his team was running simulations on more than a dozen iterations concurrently. That was made possible by around 7,500 cores powering the data work. The simulation runs took 30 hours.

This is all to say that yes, there is lots of tech money in Formula One helping the teams do their job and stay financially solvent. But there’s also a boatload of tech going into the real guts and bolts of F1 as well. And as an F1 dweeb, it brings me great joy to see a passion of mine intersect with work.

Now, back to our more regular fare.

The Midwest’s latest unicorn

M1 Finance is a company that keeps cropping up in my reporting life. Mostly because it keeps raising money and announcing new performance metrics. This week the company landed a $150 million round at a valuation of $1.45 billion. The consumer fintech superapp’s latest funding was led by SoftBank’s Vision Fund 2.

So, why do we care? Well what’s super fun about M1 is that the company told us how to track its revenue growth over time. Early in my coverage of the startup its CEO said that it hopes to generate around 1% of its assets under management (AUM) as revenue. So, we can kinda back-of-the-envelope the company’s revenue growth by tracking how quickly it accretes AUM.

And the company keeps releasing AUM numbers. (PR folks, providing longitudinal data is a great way to keep us interested in a startup!)

Here’s a rundown of M1’s AUM over time:

• June, 2020: $1.45 billion.
• October, 2020: $2 billion.
• March, 2021: $3.5 billion.
• July, 2021: $4.5 billion.

At its 1% target, those work out to target run rates of $14.5 million, $20 million, $35 million and $45 million. Or the company effectively tripled its revenues since last June. That’s pretty good and is the sort of growth that investors want to back. Hence today’s round. And M1’s new unicorn price tag.

Truveta

Remember Truveta? We’ve talked about it before, back when it was taking the wraps off its plans. Former Microsoft exec Terry Myerson is part of the team, and since I used to cover Microsoft for a living I paid attention to the startup’s early days. Truveta, as a reminder, wants to “collect oodles of data from healthcare providers, anonymize it, aggregate it and make it available to third parties for research,” as we put it last time.

Well, this week the startup announced new partnerships and $95 million in funding. That’s a pretty big check! The startup now has 17 partner health groups to boot.

By bringing together lots more data in one place, the startup hopes to help make the medical world better and more equitable. And now it has a zillion bucks to go after that goal. Let’s see what it can get done.

Other important things

To save modestly on word count and avoid braking the c0py editng stiff here at TechCrunch [ed. note: done broke], here’s the rest of what’s important that we couldn’t get to in other pieces:

Cambridge Savings Bank (CSB) gets into fintech: Remember how Goldman launched Marcus, a digital bank for regular folks? It’s not alone in the effort. Now CSB has built and launched its own digital-first bank called Ivy. Frankly I kinda like this idea: Take a bank that has a long operating history and a classic tech stack and services suite. Then build something right next to it that is more modern. It’s probably a better solution than trying to force an old bank to learn new tricks. Also if more banks do this, it undercuts neobanks to some degree, right?

Code-X raises $5 million, proves that you can share your valuation and not burst into flame: A small note that Code-X, a Florida-based startup that has built a “lattice-based data protection platform,” is now worth $40 million thanks to its latest capital raise. No, I don’t know what a “lattice-based data protection platform” is. But I do know that Code-X announced its valuation as part of an early-stage round. That’s worth applauding. Good on Code-X.

Finally, data from DocSend: The document-sending company with a somewhat literal name dropped some new data this week that I’ve been chewing on. Here’s the core bit:

[N]ew Q2 2021 data from DocSend’s Startup Index shows a 41% year-over-year (YOY) increase in investor interest and engagement (a proxy for demand) with startup pitch decks. Links created by founders actively fundraising with their pitch decks (an indicator of supply) were up 36% YOY in Q2 2021.

Why is this fun? Demand went up more than supply! Ha! That really kinda says it all.

We’ve been digging into the venture world’s Q2 results for weeks now, and somehow failed to summarize succinctly. Why are startup valuations going up? Why are startups raising more, and faster? Because amongst venture-backable companies, investor demand is far greater than startup supply.

2021 in a nutshell.

You are amazing and delightful and look great today!

Next week we’ll have notes on two battery-focused SPACs, namely Evonix and SES. Lots to chat about there when it comes to battery tech, energy density and the future of well, everything. And money.

Your friend,

— Alex

Like some of the best consumer tech from the last decade, I didn’t know I needed an e-bike until I was on one, breezing down the bike lane contemplating my newfound freedom.

Before buying a Nintendo Switch, I would have never guessed how much a candy-colored gaming console that I could pop out of a dock and into my backpack for long flight would fill me with joy. An e-bike, particularly this e-bike, the VanMoof X3, feels like that.

For anyone who hasn’t spent time riding an electric bike, the sensation of effortlessly zipping around, electricity near-silently humming beneath you, is difficult to describe and best experienced first-hand.

I live in Portland, Oregon, land of ample bike lanes and naked bike rides. When I first moved here, I biked everywhere, but that habit slowly dissolved over the years. First, I bought a car for weekend camping trips, which slowly became weekday errand running.

A few years later, I got diagnosed with a chronic illness and suddenly found myself much less confident in what my body could do and where it could comfortably take me. Over time, my bike would only see a handful of rides a season on beautiful days, when I’d always sigh and think I wish I biked more — it makes me feel good!

Before testing the X3, I’d find excuses to drive short distances instead of riding my bike. What if I got tired and didn’t feel like biking home? What if it starts pouring rain? What’s if it’s too hot? What if I’m too sweaty when I get to the office? Riding an e-bike erases most of those concerns outright.

The X3 is an effortless enough ride that I can still zoom to work if it’s 95+ degrees out. It’s fast enough that I can get out of a surprise rainstorm quickly if need be. If I don’t want to be sweaty at the start of the day, I can lean on sweet, sweet electricity to whisk me away, rolling up to my office without breaking a sweat. And it can’t go unstated that going fast on a bike — the whole time, with as much or little effort as you feel like putting in — is really, really fun.

VanMoof’s handsome pair of high tech bikes, the X3 and its larger cousin the S3, are far from the only options on the market, so some of their pluses would hold true for any electric bike. But that doesn’t make the VanMoof interchangeable either. The VanMoof X3 has a very specific look, feel and feature set that will perfectly suit a certain kind of rider (myself included) but other e-bike shoppers will still want to play the field. We’ll get into that — here goes!

VanMoof X3 in the city of roses.

APPEARANCE

I tested the VanMoof X3 over the S3 not by choice — its geometry is a little wacky looking in pictures — but because I’m 5’4″. The X3, which fits anybody from 5′-6’5″, is a little smaller and less traditional looking than the S3, which suits anyone taller than 5’8″. The X3 has 24″ wheels rather than the S3’s 28″ wheels and it has a little bungee-corded platform in the front where presumably you could carry something, but I still have no idea what (You can also buy an add-on front basket that slots in there and looks very cute.)

Like most e-bikes, the X3 is much, much heavier than a normal road or commuter bike. The listed weight is 45.8 lbs and you’ll feel every pound of it if you ever need to carry it very far. I live in a standalone house in Portland, Oregon and had to carry the X3 down a very short front step to ride it — totally fine!

I used to live in a fifth floor walkup in Brooklyn and carrying it up or down that would have been impossible. If you can’t store the X3 (or most any e-bike) around ground level with access to a charger, it might not be a good fit for you. (Note that in our pictures, the small platform above the chain area is where an optional external battery pack, discussed later, sits. The platform is removable.)

Though on paper I’d prefer the look of the S3, the X3 doesn’t look strange at all IRL, whether parked or with somebody riding it. It’s cute, futuristic but not conspicuous and gets plenty of compliments. My wife described its aesthetic as “Death Star chic” and while I don’t totally know what that means, she’s not wrong. On the way to my office a sanitation truck driver rolled down his window to bellow “HEY—THAT’S A REALLY COOL BIKE.” Thanks, my dude!

The current generation of VanMoof e-bikes are coated in matte paint and you can choose between a classic, sexy matte black or a pleasantly cheery matte light blue. A previous version of the bikes used glossy coating, but apparently the matte is supposed to be more scratch resistant. The paint does seem pretty tough though it’s not totally bombproof. Somehow the handlebars picked up a little nick in the paint, though I still have no idea where it came from or what did it (owls?).

Something important to note is that neither the VanMoof X3 or S3 look like e-bikes. They don’t have an ugly bulge jutting out from the frame and the top tube and down tube are both thick but uniform — and not so thick you’d think twice about it.

The electronic components are nestled away in the frame and even the drivetrain is tucked away and enclosed. And while there’s a deeply cool LED matrix display embedded in the top tube, only the rider really sees it. For anyone looking for an e-bike that doesn’t scream e-bike!!!! the VanMoof is one of the best choices if not the best choice you could make. It’s an awesome looking bike — not just an awesome looking e-bike.

Matrix display shows battery life, speed and other key info.

RIDING

The VanMoof X3 is a nice-looking bike — you get it. But what about, you know, the biking? I can confidently report that from the first time you hop on it to your twentieth commute to work, the X3 is an absolute joy to ride.

As an e-bike newcomer I had reservations. Would the electric assistance cheapen the magic of riding a bike? Do I really want a bike doing the shifting for me? As it turns out, quite the opposite and yes, absolutely.

The VanMoof X3 (and its sibling the S3) give you an electric boost while pedaling — you’ll still be pedaling but it feels enticingly easy and you’ll go faster with less effort. The bike also features a Turbo Boost button on the right-side handlebar that gives you a big boost on top of the smoother normal electronic assistance, up to 20 miles per hour in the U.S.

You can choose the amount of help that you want. Using the VanMoof app, which we’ll get to, or a physical button, you can select what level of power assist you’d like from zero to four. Zero is you pedaling a heavy-ass bike alone with no help (it sucks) and four makes everything feel so easy there’s almost no way to break a sweat.

In my time testing the bike, I’d use “two” when I felt like getting a bit of a workout with extra pep in my pedal, four when I was in a hurry to get to my co-working space in the mornings and three the rest of the time, like riding to brunch on a weekend. Being able to choose the level of pedal assistance is a huge perk and it makes the bike feel flexible for different uses.

The kick lock button, back wheel and enclosed chain.

Whatever mode you’re on, the turbo boost button is a killer feature. It flattens steep hills and makes it feel way safer to zip across busy intersections where you’re not sure drivers are paying attention. It’s fun and awesome for safe, defensive city riding.

It takes a little bit to get used to the automatic electronic shifting but that’s silky smooth too. I initially assumed that, like many things that worked perfectly well before having some extraneous “smart” high-tech nonsense draped over them (fridges! lamps! vibrators!) the technology would fail just often enough to be a nuisance.

After a long period of testing, I can report that the X3 rides as smooth and seamless as ever. Every once in a while I’d crunch down on the pedal or a gear won’t catch right away but it’s super rare. You can even use the app to customize when the bike shifts up and down and it’s worth playing around with that to find something that feels just right.

What else? The X3’s maximum assisted speed is in the U.S. is 20 mph (32km/hr), but anyone in Europe will be limited to 15.5 mph (25km/hr). The U.S. speed feels great and it’s painless to get up to 20mph and maintain that speed with the X3 in a way I’d have to destroy my quads to manage otherwise, even on my zippy non-electric road bike.

Beyond that, the seat is very comfy and the ride is pleasantly upright and natural. After riding the X3 for a while I had a hard time going back to hunching over on my (adorable) little Bianchi and pined for the comfy ride I’d gotten so used to.

Tail light from the future.

VALUE

The VanMoof X3 is an excellent value, all things considered. The company has a weird habit of tinkering with its pricing, but after a redesign and a colossal price drop in 2020 ($3,398 to $1,998 at the time) the bikes feel very well priced. Now they’re retailing for $2,298 — $300 more than the previous price but still a fine deal for anyone looking for a very full-featured e-bike without spending more than around $2,000.

That’s not very much more than you’d spend on a regular bike, sans electricity and many, many cool bells and whistles. And if you’re into higher end bikes, it could even be a lot less. It’s also substantially less than the high end of e-bike competition, which the VanMoof bikes feel like they compete with, even with the wallet-friendlier price tag.

Still, it’s kind of stressful that VanMoof is quietly messing around with the pricing with the bikes already out in the wild. It would suck to plan to buy one only to see the price shoot up before you’d pulled the trigger.

The company should be more transparent about this, giving set future dates for planned price changes. There also seem to be updates within generations of the bikes, so an X3 you buy now might differ from an X3 you could buy in 2020. That’s confusing and all of it should be made clearer somewhere obvious on the website.

The VanMoof app’s in-app ride tracking and summary stats.

RANGE

One of the biggest considerations with an e-bike (or an e-anything!) is range. VanMoof says the X3’s range is 37 miles using “full power” and up to 93 miles in economy mode. If you’re getting 93 miles out of the battery, you probably aren’t even using the pedal assistance at all, so you can just toss that number out. The low end estimate of 37 miles might be a little generous for someone who’s using the bike on the fourth power assistance level and smashing the turbo boost regularly, but 35-45 miles feels about right from my testing (usually mode 3 or 4, occasionally 2, light use of turbo button).

The range feels good. Even using the X3 most days out of the week, charging is infrequent enough to never feel annoying. In my case, that meant daily short rides (2.5-5 miles, usually) and the occasional longer ride (10-20 miles). If you’re using the X3 or S3 to commute to work somewhere that’s farther away, you’re going to find yourself plugging in more. Even so, I never got into a situation where I was concerned that I’d run out of battery far from home. And even if you do, you can still pedal the bike — it’s just really heavy. Most people will probably charge up overnight, but you can fill up the battery in four hours if you need to.

Something to note is that you’ll plug in a wall charger directly to the bike to charge it. For anyone who can’t charge and store the X3 on ground level, know you’ll have to carry the whole dang bike to an outlet. The lack of a removable battery might be a strike against the VanMoof bikes for folks who live in walk-ups or small apartments, but for people with somewhere easy to store it, this wasn’t something I thought twice about.

While the built-in range is totally adequate for a lot of use cases, VanMoof just introduced an external add-on battery pack for both the X3 and S3. The battery slots into a little platform, pictured below and mounted on our test bike, and it extends the X3’s range considerably. VanMoof sells the PowerBank accessory for $348. The thing isn’t small — it weighs six pounds — but VanMoof says it’ll give you anywhere from 28 to 62 miles of extra range. Again, almost nobody is going to hit the high end of this, but even at the low end it almost doubles the bike’s existing range.

External PowerBank via VanMoof

The PowerBank is big and pretty clunky. It doesn’t look awful, but it definitely makes the X3 look like an e-bike. It’s not elegant like the removable battery on the Cowboy, another extremely handsome e-bike, but it’s ok. If everything else about a VanMoof suits you perfectly but you need more range, it’s great to have the option, even if you’ll be shelling out for it.

TECH FEATURES

The tech bells and whistles are something that really makes the VanMoof X3 and S3 stand out from the crowd. The X3’s price feels reasonable for a reliable, great-looking e-bike, but on top of that you’ll be getting an electric steed with some pretty sweet tricks. I’ll list them!

• Matrix display: On the bike’s top tube an array of LED lights built into the metal displays your speed, battery life and other useful info. This is a killer feature, it’s extremely cool!
• Alarm. You can activate an alarm that will *literally growl* at anyone who jostles your bike. It’s intense and really loud.
• Kick lock. You can kick a small physical button to alarm the bike and lock the back wheel. If you live in a city with bike theft, someone could still toss the bike in a truck easily so this isn’t a single security solution (use a normal lock!)
• Find My on iOS. If you’re an iOS user you can track your bike’s whereabouts easily. It’s a nice feature, though ideally if your bike is well-locked you aren’t going to be messing with this much.

VanMoof support for “Find My” app in iOS

• Lights. The VanMoof X3 has great built-in lights, front and back.
• App: Surprisingly, the app is actually pretty good. You can customize lots of small things (bell noise, alarm on or off, shifting preferences), use it to track your rides and more. You also don’t have to be connected to the bike with the app to do the most essential stuff, liking riding it, unlocking it and changing your level of electric assistance. I had an occasional connectivity problem with the app (usually on Android) but this was easily resolved and never kept me from biking anywhere, though it did mean some rides weren’t automatically tracked.

Overall, something great about the X3 is that the tech features aren’t just fancy tricks — they really enhance the experience. And even so, they’re optional. You can ride the bike and benefit from the power assistance without using the app. You can use a regular lock and skip the alarm system if you choose to, or use a physical button code to disable it manually. You can change the power assistance mode with the same button. This is all huge and lets you use the e-bike how you want to. Personally, I’d never buy an e-bike that required connectivity, a phone or an app to operate it; that’s just asking for trouble.

OTHER CONSIDERATIONS

Shipping and Assembly: The VanMoof X3 and S3 come in the mail in a big box. The assembly process was almost painless — except for this one really fiddly bit you have to slide into another fiddly bit which took me the better part of an hour and some searching on the VanMoof subreddit (not the only one with this problem!)

Extra Support: VanMoof offers three paid plans to keep your bike in working order and in your possession. You can buy a three-year maintenance plan for $348, a three-year theft recovery plan for $398 or a combined plan for $690 (broken down via VanMoof below).

Maintenance: Where you live should be a major consideration when thinking about buying a VanMoof. In my time testing it for reliability over an extended period, I was surprised at how few problems came up. I had to mess around with re-centering the front wheel at some point because a brake pad was rubbing, but aside from occasional app connectivity issues, that was pretty much it. Of course, significant wear and tear means any bike could benefit from a pro tune up from someone who knows the model.

VanMoof has full-fledged stores in Amsterdam, London, Paris, Berlin, New York, San Francisco, Seattle and Tokyo. Beyond its flagship stores, the company relies on an expanding network of service centers and “certified workshops” to maintain its bikes, so be sure to check what’s near you. Personally, I’d want to be near enough to a VanMoof store or at least a service center to guarantee my $2,000+ investment and its many, many technological bits could be maintained in perfect health. Nobody wants to ship a bike back for repairs, especially this one.

Prior to testing out the X3, e-bikes aren’t something I’d thought a lot about. I first heard of VanMoof a couple of years ago when a close friend and much more serious biker than me bought one for towing her dog (the goodest girl) on a long work commute. We rode to the farmer’s market together and her bike looked very cool, but I was skeptical that something with so much technology under the hood could prove reliable over time.

Bikes are mechanical and simple — that’s something wonderful about them! Could an e-bike really translate the joyful simplicity of biking into something much more high tech? As it turns out, yes. After test riding the VanMoof X3 to get a sense of its reliability over time and how its features hold up in normal day-to-day use, I regret my early skepticism.

I don’t know if I can overstate how much riding an e-bike, specifically this e-bike, has enhanced my life in small ways for the better. I feel happier and healthier, transitioning out of the intensely sedentary pandemic period into daily habits and outside activities that make me feel more connected to the world around me. I’m seeing my city with fresh eyes, biking to new neighborhoods I’ve never explored and appreciating all of the little things I took for granted. My only e-bike regret is not hopping on one sooner.

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Hello and welcome to Daily Crunch for July 16, 2021. A PSA: A few of us at TechCrunch took some time this week to chat about funding rounds, covering them and how startups might stand out. If that’s your sort of thing, you can check out the chat here. OK, news time! — Alex

The TechCrunch Top 3

• The Zomato IPO: Indian unicorn Zomato’s IPO had a good run this week, raising lots of money and generally being oversubscribed. TechCrunch also dug into what the first unicorn offering in the country might mean for other high-priced startups in the country. For more on the company’s finances, head here.
• Intel’s big buy? Back in the United States, news broke this week that aging chip giant Intel may dish out $30 billion for GlobalFoundries. That’s a lot of money. The deal could help make Intel a full-stack chipmaker able to make silicon for, well, just about anything. More capacity for manufacturing during a global chip shortage wouldn’t be so bad, right?
• What’s next for Virgin Galactic: Our own Devin Coldewey got some time with the president of Virgin Galactic to chat about the future of the company after its recent jaunt to space (or nearly space, depending on how you measure). It turns out the company expects to reuse its space plane hundreds of times. That should make for pretty attractive economics, we reckon.

Startups/VC

• Blend is no longer a startup: Banking tech unicorn Blend went public this week. It’s now worth $4 billion or so, more than its final private round. So consider the company not only no longer a startup, but also no longer a private unicorn. Blend’s software powers the mortgage option in other apps, making it a company that you may not have heard of but may have used.
• Halla raises $4.5M to help guess what you are going to eat: Buying groceries online is big business. Amazon is into it. It’s Instacart’s core remit. And European grocery delivery services have been raising oodles of money. Halla wants to help those companies sell more stuff by “using human behavior to steer shoppers to food items they want while also discovering new ones as they shop online.”
• Rivian once again delays EV deliveries: The global chip shortage — see our earlier note regarding Intel — is showing up in a host of places, including Rivian’s ramp toward commercial production of its electric vehicles. Other issues are holding the company up, but this chip shortage is a real kettle of fish for companies of all shapes and sizes.
• Yummy wants to build Venezuela’s superapp: Then there’s Yummy, which just raised a $4 million round. It has big aspirations: ride-hailing, delivery and more. The superapp model may have been spearheaded in Asia, but it’s going global. Yummy will need more than $4 million to build it, however. So if things go well, expect the company to raise again in short order.

From our recent Early Stage event, we have something new for your enjoyment: Cleo Capital’s Sarah Kunst explains how to get ready to raise your next round.

Outdoorsy co-founders detail how they expanded the sharing economy to RVs

Seven years ago, ad executive Jen Young and tech entrepreneur Jeff Cavins stepped away from the careers they’d built to launch Outdoorsy, an RV rental marketplace.

Last month, they announced a partnership with high-end camping company Collective Retreats and raised a $90 million Series D and $40 million in debt to speed up an already impressive rate of growth.

To learn more about their approach to building a transportation company that caters to people who crave a taste of nomadic existence, Rebecca Bellan interviewed Young and Cavins for Extra Crunch.

Their conversation explored the impacts of COVID-19, their business strategy and why they decided to take on $30 million in debt financing:

Jeff Cavins: We like to look at macro trends as a business and I think U.S. monetary policy is going to get us all in a little bit of trouble. So we wanted to lock in a credit facility for the company at advantageous terms.

(Extra Crunch is our membership program, which helps founders and startup teams get ahead. You can sign up here.)

Big Tech Inc.

• FedEx pours $100M into Delhivery: First, we love the name for the Indian logistics startup. It’s rumored to be heading for an IPO this year. The deal underscores how key the Indian market is proving to be not merely for its domestic investors and founders, but also for global brands.
• Paytm is going public: Indian fintech giant Paytm has filed to go public. We’re including it in this section of the newsletter because, as we reported, the private company “plans to raise up to $2.2 billion in an initial public offering.” That’s a huge, huge amount of money. It’s hard to call Paytm a startup when it’s raising a few venture capital funds’ worth of capital in a single go.
• Tumblr’s parent company buys Pocket Casts: Automattic, famous for WordPress and the owner of what’s left of Tumblr, is buying popular podcasting service Pocket Casts. It’s not impossible to see how a publishing platform might integrate with a podcasting service, yeah?

To close us off from the world of Big Tech backing money, this from Connie Loizos: Traditional VCs turn to emerging managers for deal flow and, in some cases, new partners.

TechCrunch Experts: Growth Marketing

Image Credits: SEAN GLADWELL (opens in a new window) / Getty Images

We interviewed Kathleen Estreich, formerly of Intercom, Box, Facebook and Scalyr, and Emily Kramer, formerly of Asana, Carta, and Astro (acquired by Slack), as part of TechCrunch Experts. We’re taking this conversation to Twitter Spaces on Tuesday, July 20, at 5 p.m. EDT. Join TechCrunch’s Danny Crichton and the MKT1 team as they dive further into the growth marketing trends they’re seeing.