Author: azeeadmin

In the previous part of this EC-1, we looked at the technical details of CockroachDB and how it provides accurate data instantaneously anywhere on the planet. In this installment, we’re going to take a look at the product side of Cockroach, with a particular focus on developer relations.

As a business, Cockroach Labs has many things going for it. The company’s approach to distributed database technology is novel. And, as more companies operate on a global level, CockroachDB has the potential to gain some significant market share internationally. The company is seven years into a typical 10-year maturity model for databases, has raised $355 million, and holds a $2 billion market value. It’s considered a double unicorn. Few database companies can say this.

But its growth depends upon securing the love of developers while also making its product easier to use for new customers. To that end, I’m going to analyze the company’s pivot to the cloud as well as its extensive outreach to developers as it works to set itself up for long-term, sustainable success.

Cockroach Labs looks to the cloud

These days, just about any company of consequence provides services via the internet, and a growing number of these services are powered by products and services from native cloud providers. Gartner forecasted in 2019 that cloud services are growing at an annual rate of 17.5%, and there’s no sign that the growth has abated at all.

Its founders’ history with Google back in the mid-2000s has meant that Cockroach Labs has always been aware of the impact of cloud services on the commercial web. Unsurprisingly, CockroachDB could run cloud native right from its first release, given that its architecture presupposes the cloud in its operation — as we saw in part 2 of this EC-1.

Most database startups avoid building relational databases, since that market is dominated by a few goliaths. Oracle, MySQL and Microsoft SQL Server have embedded themselves into the technical fabric of large- and medium-size companies going back decades. These established companies have a lot of market share and a lot of money to quash the competition.

So rather than trying to compete in the relational database market, over the past decade, many database startups focused on alternative architectures such as document-centric databases (like MongoDB), key-value stores (like Redis) and graph databases (like Neo4J). But Cockroach Labs went against conventional wisdom with CockroachDB: It intentionally competed in the relational database market with its relational database product.

While it did face an uphill battle to penetrate the market, Cockroach Labs saw a surprising benefit: It didn’t have to invent a market. All it needed to do was grab a share of a market that also happened to be growing rapidly.

In previous parts of this EC-1, I looked at the origins of CockroachDB, presented an in-depth technical description of its product as well as an analysis of the company’s developer relations and cloud service, CockroachCloud. In this final installment, we’ll look at the future of the company, the competitive landscape within the relational database market, its ability to retain talent as it looks toward a potential IPO or acquisition, and the risks it faces.

CockroachDB’s success is not guaranteed. It has to overcome significant hurdles to secure a profitable place for itself among a set of well-established database technologies that are owned by companies with very deep pockets.

It’s not impossible, though. We’ll first look at MongoDB as an example of how a company can break through the barriers for database startups competing with incumbents.

When life gives you Mongos, make MongoDB

Dev Ittycheria, MongoDB CEO, rings the Nasdaq Stock Market Opening Bell. Image Credits: Nasdaq, Inc

MongoDB is a good example of the risks that come with trying to invent a new database market. The company started out as a purely document-centric database at a time when that approach was the exception rather than the rule.

Web developers like document-centric databases because they address a number of common use cases in their work. For example, a document-centric database works well for storing comments to a blog post or a customer’s entire order history and profile.

Bloomberg broke news earlier this week that Apple, the consumer hardware giant with a rising services focus, is building a buy now, pay later (BNPL) service that will integrate with its Apple Pay system. The news sent shares of Affirm down just over 10% by the end of the day, and it shed 2.5% of its value yesterday. It’s off a little more than 61% from the highs it set after debuting earlier this year.

In light of information that Apple could cut into Affirm’s business, investors decided the former consumer fintech unicorn and present-day public BNPL company was worth less. Why? Because rising competition from a player like Apple may limit its growth over time, impacting later profitability. Or more simply, public-market investors decided that the present value of its future cash flows had declined.

It’s not fair to focus on Affirm, of course. Afterpay is also a public BNPL firm; its shares also fell this week, slipping a similar 10% since its close on July 12, the day before the Apple news broke.

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Those are just two names. There are a host of rival BNPL concerns in the world, from small startups to private-market giants like Klarna. Affirm and Afterpay, however, as focused companies in the space that also float, make for a useful window into how investors’ views on the sector are changing in light of the recent Apple announcement.

Our question is what impact the Apple news item may have on startups, given that Apple Pay itself already accounts for about 5% of global card transactions (according to one analysis at least). The answer, I think, is that it will vary a lot based on the focus of the BNPL startup in question. The more specialized the BNPL provider, the less likely that Apple’s eventual foray into the BNPL space may prove combative; the more general the BNPL player, the more likely that Apple could cut into its business.

Why? Distribution and customer expertise.

This isn’t to say that Affirm, Afterpay and other BNPL players are set to follow the dodo; far from it. But if Apple wades into the BNPL market as anticipated, its Apple Pay service could provide a strong distribution network that may ease consumer onboarding. That Apple has also launched a credit card tied to its Apple Pay efforts and offers a lightweight cash-management solution in the United States could also lower the threshold for uptake of the product because consumers are already becoming comfortable with Apple as a banking player of sorts.

Apple also controls massive digital marketplaces, albeit places where BNPL services may prove less pertinent. But it controls brick-and-mortar stores for its own goods around the world, and a global e-commerce operation via its own websites that could provide extra distribution for BNPL services from the company. Simply: Apple sells a lot of pricey products that would be good candidates for BNPL purchases.

All of that will hit some startups. Let’s talk about which are going to dodge the incoming competitive bullet.

It seems like everything is being pushed online now, but network procurement stubbornly has remained an in-person or phone-based negotiation. Lightyear, an early stage New York City startup decided to change that last year, and the company announced a $13.1 million Series A today.

The round was led by Ridge Ventures with participation from Zigg Capital and a slew of individual investors. Today’s investment comes on the heels of a $3.7 million seed round last October, bringing the total raised to $16.8 million.

CEO and co-founder Dennis Thankachan says that the company has been able to gain customers by offering a new way to procure network resources, which was a great improvement over manual negotiating.

“Last year we launched Lightyear, which was the first tool for buying your telecom infrastructure on the web. And although changing behaviors and the way that enterprises have done things for years is difficult, the status quo in telecom has been zero transparency, no web-based ways to do things, and oftentimes interfacing with really, really large vendors where you have no negotiating leverage even if you’re a big enterprise. That experience was so poor that a lot of enterprises were extremely happy to see what we put in the market,” he said.

What Lightyear offers is an online marketplace where companies can interact with vendors and get a range of price quotes to make a more informed buying decision. The company spent a lot of time improving the product since last October when you could configure some basic stuff, get a price quote, and Lightyear would help you buy it.

Now Thankachan says that the solution covers the full lifecycle of services including configuring a bigger array of services, helping manage the installation of the services and helping reduce the amount of delays and errors in installs. Finally, they help track and manage network inventory and can automate renewal for a whole group of services,

That has resulted in 4X growth in just 9 months since the last round. In addition, the company had relationships with 400 vendors in October and has grown that to mid-500 vendors today. The startup has also doubled the number of employees to around 20.

Thankachan says that as a person of color he is particularly cognizant about building a diverse and inclusive culture. “I’m a person of color, who has been a minority in different work environments in the past, and I know how that feels and how frustrating that can be for a person who feels like their voice is not heard. […] So I think we can start to build a culture that is not necessarily the norm in [the telecommunications industry] by trying to give opportunities to [underrepresented] people,” he said.

Yousuf Khan, a partner at Ridge Ventures, who is leading the round and will be joining the board under the terms of the deal, says that as a former CIO he found Lightyear’s approach quite appealing.

“As a former CIO and someone who has led global technology operations, it’s refreshing to see Lightyear transforming the way business infrastructure gets bought…I wish Lightyear existed during my years as a CIO,” Khan said in a statement.

The mystery of who will occupy the final seat on Blue Origin’s debut human spaceflight next week is a mystery no longer: The company revealed today that the winning bidder who forked over $28 million for the privilege is actually going to fly on a later mission, and instead the final seat on the debut flight will go to Oliver Daeman, an 18-year-old high school graduate bound for the University of Utrecht. He’ll be the youngest person to travel to space, which means this launch will include both the youngest and the oldest people ever to make the trip.

Blue Origin is planning to fly its founder Jeff Bezos to space in just a few days on July 20, on its debut human spaceflight. That spacecraft will also be carrying Bezos’ brother, along with 82-year old aerospace pioneer Wally Funk, on the trip to suborbital space for a few minutes of weightlessness and unparalleled views before coming back down for a controlled landing in West Texas.

The final seat was auctioned off via a multi-stage process that culminated in a live online bidding rally, which brought the final total paid for the ticket to that whopping $28 million, which is much more than the regular price of the average seat will be during regular commercial flight of the New Shepard spacecraft. That winner, who remains anonymous for now, has declined to go on this one due to “scheduling conflicts.” The funds from the ticket auction are actually being donated to charity, however, rather than acting as revenue for Blue Origin in a commercial sense, going instead to its registered non-profit Club for the Future, which is dedicated to furthering STEM education.

Blue Origin’s New Shepard launch vehicle is designed for suborbital commercial human spaceflight, including both tourism and research uses. The fully reusable system consists of a booster and an upper stage that includes a crew capsule, and after a series of test flights that began in 2015, Blue Origin is now ready to fly it with people on board for the first time, as a final set of

Aurora Innovation, the autonomous vehicle startup that acquired Uber’s self-driving unit in December, is going public via a merger with special purpose acquisition company Reinvent Technology Partners Y.

The deal announced Thursday confirms TechCrunch’s reporting in June that the startup was in final talks with the SPAC launched by LinkedIn co-founder and investor Reid Hoffman, Zynga founder Mark Pincus and managing partner Michael Thompson.

The combined company, which is will  be listed on Nasdaq with the ticker symbol AUR, will haven implied valuation of $13 billion.

Through the deal, Aurora is capturing $1 billion from private investors including Baillie Gifford, funds and accounts managed by Counterpoint Global (Morgan Stanley), funds and accounts advised by T. Rowe Price Associates, Inc., PRIMECAP Management Company, Reinvent Capital, XN, Fidelity Management and Research LLC, Canada Pension Plan Investment Board, Index Ventures, and Sequoia Capital, as well as strategic investments from Uber, PACCAR, and Volvo Group.

The combined company said it’s expected to have about $2.5 billion in cash at closing, including up to $977.5 million of cash held in Reinvent’s trust account from its initial public offering which closed on March 18, 2021, according to regulatory filings.

Aurora has gone from buzzy startup to publicly traded company-via-SPAC in a span of four years. The company was founded in 2017 by Sterling Anderson, Drew Bagnell and Chris Urmson, all whom have a history of working on automated vehicle technology.

In December, the company reached an agreement with Uber to buy the ride-hailing firm’s self-driving unit in a complex deal that valued the combined company at $10 billion. Under the terms of that acquisition, Aurora did not pay cash for Uber ATG, a company that was valued at $7.25 billion following a $1 billion investment in 2019 from Toyota, DENSO and SoftBank’s Vision Fund. Instead, Uber handed over its equity in ATG and invested $400 million into Aurora. Uber received a 26% stake in the combined company, according to a filing with the U.S. Securities and Exchange Commission.

Since the acquisition, Aurora has spent the past several months integrating Uber ATG employees and now has a workforce of about 1,600 people. Aurora more recently said it reached an agreement with Volvo to jointly develop autonomous semi-trucks for North America. That partnership, which is expected to last several years and is through Volvo’s Autonomous Solutions unit, will focus on developing and deploying trucks built to operate autonomously on highways between hubs for Volvo customers.

Venture capital at scale

Hoffman, Pincus and Thompson have promoted a concept  that they call “venture capital at scale.” To date, SPACs have been the conduit to reach that scale. The trio have formed three SPACs, or blank-check companies.

Two of those SPACs have announced mergers with private companies. Reinvent Technology Partners announced a deal in February to merge with the electric vertical take off and landing company Joby Aviation, which will be listed on the New York Stock Exchange later this year. Reinvent Technology Partners Z merged with home insurance startup Hippo.

Their third SPAC — the one now merging with Aurora — is called Reinvent Technology Partners Y, priced its initial public offering of 85 million units at $10 per unit to raise $850 million. The SPAC issued an additional 12.7 million shares to cover over allotments with total gross proceeds of $977 million, according to regulatory filings. The units are listed on the Nasdaq exchange and trade under the ticker symbol “RTPYU.”

In many ways, the Aurora-Reinvent SPAC is a union that makes sense.

Aurora already has a relationship with Hoffman. In February 2018, Aurora raised $90 million from Greylock Partners and Index Ventures. Hoffman, who is a partner at Greylock, and Index Ventures’ Mike Volpi became board members of Aurora as part of the Series A round. The following year, Aurora raised more than $530 million in a Series B round led by Sequoia Capital and included Amazon and T. Rowe Price Associates. Lightspeed Venture Partners, Geodesic, Shell Ventures and Reinvent Capital also participated in the round, as well as previous investors Greylock and Index Ventures.

Hoffman and Reinvent showing up on two sides of a SPAC deal is not unprecedented. It’s not commonplace either. Urmson told TechCrunch that to avoid potential conflicts of interest Hoffman didn’t particpate in discussions

On the one hand, Reid, given his understanding and history with the company, is one of the people best suited to understand the opportunity here,” Urmson said, adding that to avoid a conflict of interest on both sides Hoffman wasn’t involved in any discussions on the Aurora or Reinveint side.

This story is developing.

How do you go beyond the names and numbers with your startup pitch deck? For Doug Landis, the answer is one simple compound gerund: storytelling. It’s a word that gets thrown around a lot of late in Silicon Valley, but it’s one that could legitimately help your startup stand out from the pack amid the pile of pitches.

Landis knows a fair bit about the concept. Following stints at Salesforce and Google, he served as the “chief storyteller” at Box. These days, Landis is the growth partner at Emergence Capital, where he helps tell the stories of the firm’s portfolio companies.

Landis joined us on the first day of TechCrunch Early Stage: Marketing and Fundraising event to offer a presentation about the value of storytelling for startups, whittling down the standard two-hour conversation to a 30-minute version. Though he still managed to rewind things pretty far, opening with, “400,000 years ago, men and women used to sit around the fire pit and tell stories about their day, about their hunt, about the one that got away.”

Connect the dots

More often than not, decks include a series of numbers and charts. The job of a story pitch is weaving a good narrative around these figures.

If you think about storytelling, and you think about the physiological and psychological elements — what’s happening between the storytelling and the listener — we’re actually looking for the patterns. If you think about it, it’s why those jingles and commercials get stuck in our head, and we can’t forget it, even though we don’t even know much about the product. But we remember the jingle, remember the commercial, we remember the brand. Because as humans, we’re looking for the patterns in our communication. Our job is to connect the facts and fill in the holes. And from those connections, we create a story. We create a story in our brain, because our brain actually processes information through story form. (Timestamp 3:20)

• Investor Marlon Nichols and Wonderschool’s Chris Bennett on getting to the point with a pitch deck

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Get to the point

They don’t call it an elevator pitch for nothing. And sometimes even the best storytellers have a habit of rambling. Here’s an exercise for cutting away some of the excess when attempting to get your story in front of VCs.

When you tell the story at work, ask your peers or the listener to share back with you in one sentence what the point of that story was. Get immediate feedback, and you can then identify whether or not your story was on target or not. The story needs to be relevant to the audience who’s there, but the reality is, you need to be very clear about the point you’re trying to make with a story. (Timestamp 6:33)

• 11 words and phrases to cut from your VC pitch deck
• Don’t send VC a cold deck ever again: Start sending video pitches

Zūm, the startup that provides child transportation for school districts and families, is aiming to use its fleet of electric school buses to deliver power back to grid when it’s needed most. 

The company is partnering with AutoGrid, which provides energy management and distribution software, to transform Zūm’s fleet of electric school buses into one of the largest virtual power plants in the world, according to a statement from the companies. Zūm eventually plans to have a fleet of 10,000 electric buses by 2025. Once Zūm hits that 10,000 EV bus goal, the company says it will have the capacity to send one gigawatt of energy back to the grid. To put that to scale, that’s enough to power 110 million LED lightbulbs or 300,000 homes. However, Zum is far short of that 10,000-bus goal. Currently only 10% of the company’s buses are electric due to a shortage of supply, CEO and co-founder Ritu Narayan told TechCrunch.

“School buses are the largest battery on wheels,” said Narayan. “Interestingly, they are not utilized when there is a peak time for electricity, so either in the evenings or in summertime. So our bigger plan is not only what we are actually using the vehicles for during the daytime.”

This scope of the partnership, while a creative way to repurpose school bus fleets, is becoming more common in the electric vehicle industry. As EV ownership increases, companies like Zūm are recognizing the need for a give-and-take when it comes to an increasingly strained energy grid. This week, mobility company Revel announced it would work with GridRewards, an app that offers similar services to AutoGrid, in order to adjust its e-moped fleet charging schedule so it can provide power back to the grid if needed. 

School buses do present a big opportunity for such energy sharing, today more than ever. The Biden Administration has proposed a $25 billion investment in electric school buses. There are more than 500,000 yellow school buses transporting over 27 million students everyday.

The companies plan are launching the partnership in San Francisco, where Zūm has a fleet of 206 school buses, and in Oakland Unified School District, where it has 70 buses, according to Narayan. Zūm does have aspirations to expand nationwide. The company already works with schools districts in California, as well as Seattle, Chicago and Dallas, and it’s targeting Washington D.C. next.

“The transition to EVs for the school transportation sector will play a critical role in helping communities improve air quality and environmental health for student passengers and area residents,” the company said in a statement. 

Daloopa closed on a $20 million Series A round, led by Credit Suisse Asset Management’s NEXT Investors, to continue developing its data extraction technology for financial institutions, which is now being expanded globally.

When company co-founder and CEO Thomas Li worked as a hedge fund analyst, he often performed repetitive data extraction in order to gather insights for analysis and forecasts.

In fact, he found lawyers and similar financial professionals at financial institutions were spending about a third of their time on those same tasks, while also manually entering everything into spreadsheets.

“This was a big enough problem for one company to support all of the data analysis and forecasting without having to manually convert the data,” Li told TechCrunch. “This frees up analysts to then do what they are supposed to do.”

The idea for Daloopa came to Li five years ago, but he said the data extraction technology was not in place to get it off the ground. Then in 2019, the state of technology was such that Li and co-founders Daniel Chen and Jeremy Huang could create data extraction capabilities through the use of artificial intelligence-driven software. Customers can request data sets with a couple of clicks of a button and have it delivered the next day.

Accuracy in financial data collection “is mission critical,” but artificial intelligence models aren’t often able to get to 99% accuracy, whereas Daloopa is able to surpass that, Li said. Latency and volume also need to be at a point where infrastructure can support the algorithms needed to gather data from thousands of different documents.

Joining Credit Suisse in the Series A were existing investors Nexus Venture Partners, Uncorrelated Ventures and Hack VC. Daloopa previously raised both pre-seed and seed funds to give it $24 million to date.

As part of the investment, NEXT Investors and Nexus Venture Partners will each assign a member to Daloopa’s board of directors.

“Daloopa is disrupting how financial data is extracted and consumed,” said Abhishek Sharma, managing director at Nexus Venture Partners, via email. Nexus led both the pre-seed and seed rounds into the company. “Its intelligent automation approach eliminates the cost bloat and makes data extraction scalable, accurate and referenceable.”

Meanwhile, the company will use the new funding on R&D for product development, hiring additional staff members and building out the tech stack for those people to work on. It will also focus on sales, marketing and operations functions.

Li did not disclose revenue metrics, but said Daloopa self-launched its product six months ago, and today has 40 enterprise customers. It is headquartered in New York with offices in New Delhi and Rio de Janeiro.

Initially, Daloopa focused on public company financials, but plans to move into data extraction for more private documents, like documents a bank uses with its customers.

Walking into an auto repair shop can sometimes feel like taking a step into the past. The handwritten notes and receipts, the clunky point-of-sales system and scheduling tools — if those are even there — can make customers feel like they’re in the 1990s, not the 21st century.

Shopmonkey is trying to change that.

“It’s been an amazing industry to serve that I just feel like has trailed modern times and modern services by a factor of five to 10 years,” Shopmonkey CEO Ashot Iskandarian said in a recent interview with TechCrunch.

His company offers a cloud-based shop management software designed for the auto repair industry. Now, less than a year after announcing a $25 million Series B, Shopmonkey has garnered another fresh round of capital. The company has raised a $75 million Series C led by previous investors Bessemer Venture Partners and Index Ventures, as well as additional participation from returning investors Headline and I2BF, and new investor ICONIQ Growth.

The financing will be used to grow Shopmonkey’s product, sales and marketing teams, and further fuel development of its platform.

Iskandarian noticed that many auto repair shops were victims to their own processes: owners bogged down using many different tools and platforms to perform tasks like invoicing, scheduling and parts ordering. Or else they’re using a shop management system that’s downloaded on a single, local machine. “That’s the world that these shops are coming from,” he said.

Image Credits: Shopmonkey (opens in a new window)

Shopmonkey consolidates these different functions into a single cloud-based tool, so it can be accessed on multiple computers, tablets or smartphones. The software also helps the shop communicate with customers, by providing appointment reminders, confirmations and upsell offers.

Iskandarian founded Shopmonkey in 2017. Since that time, its workforce has grown to more than 125 people, and over 2,500 shops use the software. He said that changing demographic trends amongst shop owners and customer pressure has led more and more auto repair shops to look for a management solution.

Like many sectors, the auto repair industry took a hit during the coronavirus pandemic. But it’s bouncing back: according to one report, it’s expected to recover and grow 7% this year, as millions of people get back on the road or decide to purchase a used car. That’s good news for auto repair shops – and for Shopmonkey, which sees opportunity in this increased demand.

COVID and other dynamics have placed “massive tailwinds on the automotive aftermarket with used cars, used cars repairs, and just that whole sector,” Iskandarian said. “It’s a good time to be a founder and it’s a good time to be an auto repairer.”