Author: azeeadmin

London and Berlin usually top the lists of European startup hubs, but Central and Eastern European countries like the Czech Republic, Estonia, Croatia and Poland have claimed a growing portion of the startup pie in the past few years. Looking at Poland in particular, Krakow and Warsaw have blossomed into fertile grounds for entrepreneurs to grow and nurture companies, but they’re not alone.

One of Poland’s oldest and most picturesque cities, Wrocław is an up and coming contender in the startup space, thanks mostly to its academic history and its proximity to Prague, Berlin, and Warsaw. This city of 1.2 million people has a large student population that provides ready talent for the city’s startups. Indeed, since the beginning of the 20th century, this small city has been home to nine Nobel laureates.

Wroclaw has a decent number of startups, according to Startup Wroclaw, across sectors such as e-commerce (Divante, Shoptrotter), digital health (Infermedica, SensDx), software (Tooploox, Droids on Roids), analytics (Piwik Pro), work and HR (Kadromierz, ChallengeRocket), and edtech (Lerni, Flash Robotics).

So to find out what the startup scene in Wroclaw looks like, we spoke with local six investors, executives and founders. In short, the city appears to be strong in areas such as B2B, SaaS, marketplace, B2C, gaming, and medtech.

The country’s capital Warsaw has an angel investment scene, but founders instead often look to Germany for smaller investments because “the distance from Wrocław to Berlin is exactly the same as Wroclaw to Warsaw,” one of the executives said.

However, there is an air of optimism about the future: “We will have more and more global companies grown from the Wrocław’s startup scene as well as global corporations deciding to base their Polish office in the city,” one founder said.

We surveyed:

• Alena Hloba, community manager, RST Ventures for Earth
• Jakub Karkocha, CEO, LightApply
• Kamil Rudnicki, CEO, Timecamp
• Paweł Łopatka, VP Country Manager, SoftServe
• Michał Wędzicha, VP, CORE Services
• Maciej Wilczyński, CEO, Valueships

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Alena Hloba, community manager, RST Ventures for Earth

Which sectors is your tech ecosystem strong in? What are you most excited by? What does it lack?
We are excited by environmental and sustainability sector, which we invest in. We also see promise in food tech, robotics and industry 4.0 (we have some companies from these industries, too). I think we lack more solutions for nature and environment, and we are trying to fill this gap.

Which are the most interesting startups in your city?
Most of our portfolio companies: SellIntegro, Z Zieleniaka, ReactivePad, and Prosoma. There are also GlucoActive, LiveChat, Optimatik.

What are the tech investors like in Wroclaw? What’s their focus?
Most of our VCs, in my opinion, are focused on B2B, SaaS or marketplace-like startups. There are many who invest in B2C, gaming, and medical startups.

With the shift to remote working, do you think people will stay in Wroclaw, or will they move out? Will others move in?
I think most people are staying, especially the IT companies, because now it doesn’t matter where you are. It’s less probable that people will move to Wrocław unless there are less restrictive conditions to work, as in the neighboring countries.

Who are the key startup people in your city (e.g. investors, founders, lawyers, designers)?
We think that we are one of the most active investors in Wrocław, as well as VentureInc, Fidiasz.

Where do you think your city’s tech scene will be in five years?
It will develop more in the direction of sustainability (at least, we believe so). There will for sure be more startups, more investors and more startup organizations (like meetups or community builders).

Can you recommend any companies for our global Startup Battlefield competition?
We recommend us – RST Ventures for Earth as an investor, as well as our portfolio companies – ZEME, Electron Square, SellIntegro, Z Zieleniaka, ReactivePad, Samurai Labs, StethoMe, Prosoma, VersaBox, Plenti, and HerImpact.

Jakub Karkocha, CEO, LightApply

Which sectors is your tech ecosystem strong in? What are you most excited by? What does it lack?
Wrocław is quickly developing its startup ecosystem. Big companies like Google and Nokia are opening their offices in the city, which helps to educate world-class specialists who are then starting their own projects. An increasing number of events are organised by the city government and startup clusters, which helps to encourage young people to step in the IT world and bring their ideas to the table.

Poland is much cheaper in terms of salaries than Western Europe, so many companies from Germany and other countries decide to open their offices here. Wrocław is also quite close to the German border, which is a big plus — it’s well-connected both by road and air.

The biggest weakness of Poland is the mentality of the people. We are just growing our economy after getting full independence. Many older people have a strict understanding of a business and the startup ideas don’t match that. Those people might become investors, but they don’t trust in high-risk investments. We are forced to find investors abroad, which is not always easy.

Which are the most interesting startups in your city?
Some companies have left the startup phase, but they are still extremely interesting: Brand24, Divante, tensquaregames, Knights of Unity, ZMorph, and Monterail. Among startups, I would list iMieszkaniec, Infermedica, Primetric, PayEye, HerImpact, Droids on Roids, Smartlunch, Clearcode, and LightApply (of course!).

What are the tech investors like in Wroclaw? What’s their focus?
Poland is quite strong when it comes to VCs, and that applies to Wrocław too. We have couple of funds which are actively looking for innovative companies to invest in. As there are some funds from the EU, many VCs are investing in companies that can cover program requirements defined as KIS. It is much harder to find an angel investor in Wrocław — most are based in Warsaw. It is very popular to look for a smaller investment round in Germany, as the distance from Wrocław to Berlin is exactly the same as Wroclaw to Warsaw.

With the shift to remote working, do you think people will stay in Wroclaw, or will they move out? Will others move in?
Even before pandemic, suburbs in Wrocław were developing really fast. People were moving to Wrocław to work with LG, Nokia and Google. Good public transportation, small city and cheap apartments were all good reasons to buy your own flat. During the pandemic, people are usually staying home, but there has been no special change in terms of a place to live.

Who are the key startup people in your city (e.g. investors, founders, lawyers, designers)?
Tomasz Popów, Piotr Orzechowski, Tomasz Karwatka, Piotr Karwatka, Michał Sadowski.

Where do you think your city’s tech scene will be in five years?
We will have more and more global companies grown from Wrocław’s startup scene as well as global corporations deciding to base their Polish office in the city.

Can you recommend any companies for our global Startup Battlefield competition?
LightApply, Infermedica, and HerImpact.

 

Kamil Rudnicki, CEO, Timecamp

Which sectors is your tech ecosystem strong in? What are you most excited by? What does it lack?
SaaS, remote work.

Which are the most interesting startups in your city?
Livechat.

What are the tech investors like in Wroclaw? What’s their focus?
SaaS and health.

With the shift to remote working, do you think people will stay in Wroclaw, or will they move out? Will others move in?
Stay but work remotely.

 

Paweł Łopatka, VP country manager, SoftServe

Which are the most interesting startups in your city?
Litteract, Brand24, Woodpecker.

What are the tech investors like in Wroclaw? What’s their focus?
Focus is on early seed startups.

With the shift to remote working, do you think people will stay in Wroclaw, or will they move out? Will others move in?
Stay in the city – some will move out to regional areas.

Where do you think your city’s tech scene will be in five years?
Like Berlin :).

Can you recommend any companies for our global Startup Battlefield competition?
LitterAct.

 

Michał Wędzicha, VP, CORE Services

Which sectors is your tech ecosystem strong in? What are you most excited by? What does it lack?
Software development, software maintenance, team leasing, and IT specialists outsourcing.

Which are the most interesting startups in your city?
Spyrosoft

What are the tech investors like in Wroclaw? What’s their focus?
Investment funds and global players.

With the shift to remote working, do you think people will stay in Wroclaw, or will they move out? Will others move in?
Stay in the city.

Where do you think your city’s tech scene will be in five years?
Silicon valley of Poland.

 

Maciej Wilczyński, CEO, Valueships

Which sectors is your tech ecosystem strong in? What are you most excited by? What does it lack?
Software development, project and product management, design, devops. Definitely lack of capital, network and “how-to-scale” skillset.

Which are the most interesting startups in your city?
I deal mostly with SaaS, so: Brand24, Livechat (unicorn in two to three years), Timecamp, Infermedica (it will be big), and LiveSession,

What are the tech investors like in Wroclaw? What’s their focus?
Preseed/seed, heavily leveraged with public funds.

With the shift to remote working, do you think people will stay in Wroclaw, or will they move out? Will others move in?
They will stay but work remotely.

Who are the key startup people in your city (e.g. investors, founders, lawyers, designers)?
Tomasz Szpikowski, Rafal Sobczak, Tomasz Karwatka, Wojciech Mróz.

Where do you think your city’s tech scene will be in five years?
It will move towards more mature businesses for sure; more software and Industry 4.0 projects.

Can you recommend any companies for our global Startup Battlefield competition?
Brand24.

Indian e-commerce giant Flipkart has hit the market to raise about $1 billion at up to $30 billion valuation before its public listing, two people familiar with the matter told TechCrunch.

The Bangalore-based startup, which sold majority stake to Walmart in 2018, began exploring funding opportunities with some of its investors earlier this year. In recent months, the company has also internally discussed pushing its IPO process to early next year. (Media reports last year had suggested Flipkart might file for an IPO in 2021.)

SoftBank, one of Flipkart’s major investors, declined to comment on fundraise talks early this month. Another investor said it made sense that the e-commerce group was planning to raise some capital as the market currently has no shortage of it.

Flipkart was last valued at about $24.9 billion last year when it raised $1.2 billion in a round led by Walmart. TechCrunch hasn’t been able to identify the investors who might participate in the new investment round.

The Bangalore-headquartered firm competes neck to neck with Amazon in India. The American e-commerce group has invested over $6.5 billion in the South Asian market.

This is a developing story. More to follow…

Even the most casual industry observer has to be stunned at times by the pace of dealmaking right now. Not quite halfway through 2021, startups are routinely closing new rounds just months apart and sometimes seeing their valuations triple and even quadruple with every new round.

Maybe they will all become trillion-dollar companies. It’s more likely, however, that they will not, which is where year-old Caplight comes in. Led by Javier Avalos, a former investment banker who recently spent more than three years with the secondaries platform Forge, Caplight is right now building a model that it says will enable institutional investors to take long and short private company positions via synthetic, cash-settled derivatives, so whether or not they own any actual shares in certain startups, they can bet on their rise or fall.

Caplight isn’t the first company drawn to the idea. Another young startup in New York, Apeira Capital, is also looking to “short” overvalued startups.  More, Avalos and his cofounder, Justin Moore, a former engineering manager at Forge, could also face competition, from their old firm, for example, as well as Carta, the venture-backed company that makes software to manage equity stakes in other startups.

Still, Avalos thinks he’s on to something. Caplight already has $400 worth of interest from more than 30 institutions, he says. It also just closed on $1.7 million in pre-seed funding led by Fin VC, with participation from Susquehanna Private Equity Investments, Clocktower Ventures, and Dash Fund. We talked with him late last week to learn more; below are excerpts from that chat, edited lightly for length.

TC: You were at Forge, which helps people buy and sell pre-IPO shares. What opportunity did you see while working there?

JA:  I think what platforms like Forge have done really well is build tech solutions for startup employees, for startup founders, and for the companies themselves, and that’s great. What we’re really focused on are larger institutions who need true liquidity, meaning higher frequency of trading, whether that’s buying and selling option contracts, or entering swap-type agreements. [They need a way] to quickly move in and out of positions, as well as hedge themselves.

Caplight [aims to become the] infrastructure that enables any other fund that is looking to take directional positions in private companies. It’s meant to be the plumbing that connects that fund to a market, but not just the marketplace –all of the infrastructure that comes with that. So holding assets in prime brokerage; being able to quickly settle transactions through clearinghouses; being able to provide [the] data to inform a mark to market to value those contracts.

TC: Even more specifically, what are you offering?

JA: So we [want to] allow institutional investors to hedge their private company stock — to generate income on their private company stock by selling out-of-the-money option contracts, for instance. We also allow institutional investors to take short or long positions [and] we’re doing all of our transactions synthetically, so the underlying shares don’t don’t actually have to move.

TC: Is that private company stock used as collateral or encumbered in any way? Do you need the permission of the startup?

JA: The pre-IPO stock can be used as collateral. It doesn’t always need to be though. The great thing about building a synthetic platform is you can inject liquidity into the market by working with sellers who don’t actually own the stock. If I’m a hedge fund, and I don’t own shares of a pre-IPO company, but I still want to express a short interest — a negative view on that company — I could use Caplight to do that. I’d just need to hold other tradable securities as collateral. That’s part of the beauty of what makes this a marketplace that can have very rapid settlement and execution.

TC: So if a hedge fund wants to go short, it just needs to needs to find another party on your service who’s willing to take that trade? 

JA: What you need is two parties — one who one who’s interested in going short on the name, and another who’s interested in going long on the name. Beyond that, you need a model that helps these parties arrive at not just an agreed-upon valuation of the company today, but also where they’re comfortable striking a contract at some point in the future, and then a methodology for valuation at any point in time in between those two points.What we’re talking about here is a methodology to create a mark to market on what the value of that contract is at any given time between the time you enter the contract and the time you ultimately go to settle the contract. Those are really the three main ingredients that are needed here.

TC: How do you develop this methodology? How automated is it?

JA: We’re in the process of building that out now. There’s quite a bit of work, as you can imagine, that goes into that. And part of the mandate that we have having raised this pre seed funding is to go out and find the best talent to come in and help us with this.

TC: Assuming some of these inputs would include fund-raising announcements, any announced revenues, and where things are trading on the secondary market, what are other inputs might surprise people?

JA: Maybe a less obvious one is that when public mutual funds own private tech companies’ stock, they have to report out on at least a quarterly basis where they’re marking those positions, and that’s all public information. So that’s another alternative data set that we would love to pull into our platform in product form.

TC: Why does your company make sense now versus earlier? Does it tie to smart contracts?

JA: Smart contracts are are definitely an enabler. But I think it’s more of a function of where we are in the markets. Forge alone is [ approaching a billion dollars a quarter of volume] and that’s just one platform. When you sum up all the activity, we think there is $20 billion of transaction volume, meaning pre IPO shares that are trading hands each year. For that size marketplace to exist without the ability to have directional bets on top of that, or hedging that is made very easy, it just didn’t make sense to us that hedging and derivative-type transactions don’t exist.

TC: This is a work in progress. In the meantime, what’s to stop Forge or Carta from doing what you’re doing?

JA: It’s something I spend a lot of time thinking about. It goes back to a point that I mentioned earlier, which is that I think Carta and Forge have done a really good job of building tech solutions that serve the companies, and I think a lot of future growth from Carta and Forge and some of the other players is pegged on their ability to develop company relationships. And when you have a lot of [your] growth pegged on building out these relationships — a lot of the valuation that’s being ascribed to Forge and Carta and other secondary platforms is tied their ability to maintain those relationships — to turn around and stand up a marketplace that allows institutions to go short on the same companies that you’re fighting to build relationships with is a direct conflict.

Above, from left to right, Caplight founders Javier Avalos and Justin Moore. For more from this chat, including some of the legal hurdles Caplight has to overcome to operate its business, and how it attracts buyers and sellers to the platform, you can hear our longer conversation here.

Serialized fiction app Radish has been acquired by Kakao Entertainment in a transaction valued at $440 million. Kakao Entertainment is owned by Kakao, the South Korean internet giant whose services include its eponymous messaging platform. Radish founder Seungyoon Lee will hold onto his role as its chief executive officer, while also becoming Kakao Entertainment’s global strategy officer to lead its growth in international markets.

Radish claims millions of users in North America, and the acquisition will be help Kakao Entertainment expand its own webtoons and web novel business there, and in other English-speaking markets. Radish will retain management autonomy and continue operating as its own brand.

Founded in 2015, Radish originally focused on user-generated content, but now the core of its business is Radish Originals, or serial fiction series designed specifically for the app. The company said the launch of Radish Originals in 2018 helped propel its growth, with revenue increasing more than 10 times in 2020 from the previous year.

Radish monetizes content through its micropayments system, which allows users to read several free episodes before making payments of about 20 to 30 cents to unlock new episodes (users also have the option of waiting an hour to unlock episodes for free). About 90% of its revenue now comes from Radish Originals.

The acquisition means that Radish Originals’ intellectual property will now be adapted by Kakao into webtoons, videos and other content, increasing their reach. Since 2016, Kakao Entertainment has adapted several web novels including “What’s Wrong with Secretary Kim?,” “A Business Proposal” and “Solo Leveling” into webtoons and other media.

Lee told TechCrunch that Radish started exclusively distributing several of Kakao Entertainment’s most popular original series, like “What’s Wrong with Secretary Kim?” last month. It plans to launch more content from Kakao Entertainment’s portfolio and are also “looking at ways in which we can make original localized novel adaptions of Kakao’s popular stories,” he added.

In a press statement, Kakao Entertainment CEO Jinsoo Lee said, “Radish has firmly established itself as a leading web novel platform and yet we see even greater growth potential… With the combination of Kakao’s expertise in the IP business and Radish’s strong North American foothold, we are excited about what we can achieve together.”

The acquisition has been approved by Radish’s board of directors, which includes a representative from SoftBank Ventures Asia, its largest investor, and the majority of its shareholders. Radish’s other backers include Lowercase Capital, K50 Ventures, Nicolas Bergruen, Charlie Songhurst, Duncan Clark and Amy Tan, the best-selling author.

Toyota has tapped Japanese company Eneos to help develop the hydrogen fuel cell system that will power its futuristic prototype city Woven City.

The vision for the 175-acre city, where people will live and work amongst all of Toyota’s projects, including its autonomous e-Palette shuttles and robots, is to build a fully connected ecosystem powered by hydrogen fuel cells.

Woven Planet, the innovation-focused subsidiary of Toyota that is in charge of the project, announced Monday that ENEOS, a Japanese petroleum company that’s investing heavily into hydrogen, will help make Toyota’s “human-centered” city of the future. This new partnership not only signifies Toyota’s backing of hydrogen over electric, but it also could help Japan achieve carbon neutrality by 2050.

The two companies will work together to test the feasibility of a hydrogen-based supply chain, from production to delivery to usage. To facilitate this, ENEOS will further its technological developments in hydrogen production in order to achieve a fully carbon-free supply chain. 

“As Japan’s leading integrated energy company, ENEOS has demonstrated its valuable expertise in all vital processes from hydrogen production to sales and we are confident they have the holistic perspective we require for success,” said Akio Toyoda, president and CEO of Toyota Motor Corporation, in a statement. “To realize a hydrogen-based society, in addition to the evolution of individual technologies, it is essential to seamlessly integrate all the processes of production, delivery, and use.” 

Toyota is positioning hydrogen as a top viable clean energy source for the future with this partnership, although it certainly has more electric vehicles on the market than hydrogen, including three new ones this year. Its iconic hydrogen fuel-cell powered car, the Toyota Mirai, saw a 2021 upgrade, and it’s the same tech that Toyota used in its Kenworth T680 tractor. 

As part of its partnership with Woven City, ENEOS will use its expertise of operating 45 commercial hydrogen refueling stations in the four major metropolitan areas in Japan to establish one outside of Woven City. The company will also be expected to produce hydrogen derived from renewables, to help install stationary fuel cell generators inside Woven City and to work with Toyota to research hydrogen supply. 

“We believe that hydrogen energy will play an integral role in the realization of carbon neutrality on a global scale,” Katsuyuki Ota, president of ENEOS said in a statement. “By working together with Toyota to fully explore hydrogen’s potential, we believe we can make a significant contribution to the creation of new hydrogen-based lifestyles.”

Construction at the Woven City site in Susono City, Shizuoka Prefecture, at the base of Mount Fuji began in February. A month later, the Toyota subsidiary launched Woven Capital, a new venture fund that will invest in technologies that will build the future of safe mobility. Woven Capital’s first investment is in autonomous delivery company Nuro. 

More investors are joining the wave to bet on lidar, the remote sensing method that uses laser light to measure distances and has garnered ample interest from automakers in recent times. But it’s also a technology that has long been scorned by Elon Musk partly due to its once exorbitant costs.

Innovusion, a five-year-old lidar company and a supplier to Chinese electric car upstart Nio, just landed a Series B funding round of $64 million. The new proceeds boost its total investment to over $100 million, not a small amount but the startup is in a race crowded with much bigger players that have raised hundreds of millions of dollars, like Velodyne and Luminar.

Temasek, the Singaporean government’s sovereign wealth fund, led Innovusion’s latest financing round. Other investors included Bertelsmann Asia Investment Fund, Joy Capital, Nio Capital, Eight Roads Ventures, and F-Prime Capital.

Innovusion runs core development teams out of Sunnyvale, California and Suzhou, an eastern Chinese city near Shanghai that the autonomous driving unicorn Momenta also calls home.

Junwei Bao, Innovusion’s co-founder and CEO, is not deterred by the industry’s existing giants. Back at Baidu where Bao oversaw sensors and onboarded computing systems for autonomous driving, he also worked on Baidu’s investment in Velodyne five years ago.

“They were designing things more like a college student designing in their labs,” Bao said of Velodyne.

Lidar was a niche market up until about five years ago, the founder explained, for the technology was mostly used by a small community of amateurs and areas such as military, surveying and mapping. These were relatively small markets in terms of shipping volume and Velodyne filled the demand.

“They were not thinking about industrialization, volume manufacturing, or roadmap extensibility. They were a pioneer and we [Baidu] recognized their value… but we also knew their weakness.”

In fairness, Silicon Valley-based Velodyne today is a $2.2 billion company supplying to some of the world’s largest automakers including Toyota and Volkswagen. It also pocketed a hefty sum of cash after going public via a SPAC merger. Innovusion’s strategy is to make sensors for automakers that are “good enough for the next five years,” according to Bao. The company chooses “mature components” so it can quickly ramp up production to 100,000 units a year.

Its biggest customer at the moment is Nio, a Chinese challenger to Tesla which has backed Innovusion through its corporate venture fund Nio Capital. For mass production of its auto-grade lidar, Innovusion is partnering with Joynext, a smart vehicle arm of the Chinese automotive component supplier, Joyson Electronics.

For now, China is the largest market for Innovusion. The startup is scheduled to ship a few thousand units this year, mainly for smart transportation and industrial use. Next year, it has a target to deliver several tens of thousands of units to Nio’s luxury sedan ET7, which is said to have a scanning range of up to 500 meters, an ambitious number, and a standard 120-degree field of view.

Similar alliances between carmakers and lidar suppliers have played out in China as the former race to fulfill their “autonomous driving” promises with the aid of lidar. Xpeng, a competitor to Nio, recently rolled out a sedan powered by Livox, a lidar maker affiliated with DJI that markets its consumer-grade affordability.

Price is similarly important to Innovusion, which sells lidars to automakers for about $1,000 apiece at the volume of 100,000 per year.

“Adding $1,000 upfront cost plus another couple thousand dollars for a car that’s selling for $30,000 or $50,000 is affordable,” Bao suggested.

With the fresh capital, Innovusion plans to increase the production volume of its automotive-grade lidar for the OEM market and put more R&D efforts into smart cities and vehicles. The company has over 100 staff and plans to expand its headcount to over 200 this year.

Singapore-based Aspire, which wants to become the financial services “one-stop shop” for SMEs, announced that its business accounts have reached $1 billion in annualized transaction volume one year after launching. The company also unveiled Bill Pay, its latest feature that lets businesses manage and pay invoices by emailing them to Aspire’s AI-based digital assistant.

Launched in May 2020, Aspire’s online business accounts are targeted to startups and small- to medium-sized enterprises, and do not require minimum deposits or monthly fees. Co-founder and chief executive officer Andrea Baronchelli told TechCrunch more than 10,000 companies now use Aspire’s business accounts and that adoption was driven by two main reasons. The first was Aspire’s transition to a multi-product strategy early last year, after focusing on corporate cards and working capital loans. The second reason is the COVID-19 pandemic, which made it harder for companies to open accounts at traditional banks.

“We can go in and say we offer all-in-one financial tools for growing businesses,” he said. “People come in and use one thing first, and then we offer them other things later on, so that’s been a huge success for us.”

Founded in 2018, Aspire has raised about $41.5 million in funding so far, including a Series A announced in July 2019. Its investors include MassMutual Ventures Southeast Asia, Arc Labs and Y Combinator.

Baronchelli said Aspire’s business account users consist of two main segments. The first are “launchers,” or people who are starting their first businesses and need to set up a way to send and receive money. Launchers typically make less than $400,000 a year in revenue and their Aspire account serves as their primary business account. The second segment are companies that make about $500,000 to $2 million a year and already had another bank account, but started using Aspire for its credit line, expense management or foreign exchange tools, and decided to open an account on the platform as well.

The company has customers from across Southeast Asia, and is particularly focused on Singapore, Indonesia and Vietnam. For example, it launched Aspire Kickstart, with incorporation services for Singaporean companies, at the start of this year.

Bill Pay, its newest feature, lets business owners forward invoices by email to Aspire’s AI-based digital assistant, which uses optical character recognition and deep learning to pull out payment details, including terms and due dates. Then users get a notification to do a final check before approving and scheduling payments. The feature syncs with accounting systems integrated into Aspire, including Xero and Quickbooks. Baronchelli said Aspire decided to launch Bill Pay after interviewing businesses and finding that many still relied on Excel spreadsheets.

Aspire’s offerings overlap with several other fintech companies in Southeast Asia. For example, Volopay, Wise and Revolut offer business accounts, too, and Spenmo offers business cards. Aspire plans to differentiate by expanding its stack of multiple products. For example, it is developing tools for accounts receivable, such as invoice automation, and accounts payable, like a dedicated product for payroll management. Baronchelli said Aspire is currently interviewing users to finalize the set of features it will offer.

“I don’t want to close the door that others might come toward a multiple product approach, but if you ask me what our position is now, we are basically the only one that offers an all-in-one product stack,” he added. “So we are a couple years ahead of the competition and have a first-mover advantage.”

 

While consumers and businesses continue to use their purchasing power to spin the wheels of the globalized economy, one of the companies that’s built a technology platform to help that economy operate more smoothly is announcing an investment to double down on growth.

Zencargo, which has built a digital platform to enable freight forwarding — the process by which companies organize and track the movements of items they are making and selling (and the components needed for those items) — has raised £30 million (about $42 million). Alex Hersham, the CEO who co-founded the company with Richard Fattal (CCO) and Jan Riethmayer, said that London-based Zencargo will be using the funding to open offices in The Netherlands, Hong Kong and the U.S.; to more than double its headcount to 350 from 150 today; and to begin to make moves into trade finance — a critical lever for facilitating the trading activities that are the bread and butter of Zencargo’s business.

The Series B is being led by Digital+ Partners, with HV Capital, which led its previous round, also participating. Zencargo is not disclosing its valuation but the company — which provides services to both to companies and distributors like Amazon to ship goods to its fulfillment centers; and brands like Vivienne Westwood, Swoon Furniture, and Soho Home — said that it is on track to make £100 million in revenues this year, and £200 million in 2022.

That is against the backdrop of some major world events that have both proven to be challenges as well as opportunities for the startup.

Brexit in the UK has created quite a mess for moving goods in and out of the country and into Europe (difficult but ultimately a net positive for Zencargo: it helps facilitate some aspects of that movement for its clients). Covid-19, meanwhile, has impacted economies (again: a difficult impact but also a positive, in that people are spending more money on goods for themselves and less on travel, leading to more demand for shipping those goods around the globe).

The Suez Canal blockage, on the other hand, also continues to loom (not great: Hersham said that Zencargo and others are still dealing with the fallout of those delays, although it’s highlighted the need for blended approaches when it comes to moving goods, with some items shipped slower by sea, and others faster by air or road). And there is the growing priority of how shipping impacts carbon footprints (an area of opportunity, interestingly: Zencargo can provide more efficient routing, and also services to consider how to carbon offset shipping activities).

The more general challenge that Zencargo is tackling goes hand in hand with our existence as consumers.

Many of us do not blink an eye when we go online or to a store to procure something, and we get whatever that happens to be right away.

But the simplicity of wanting and subsequently obtaining goods sits on top of a huge, and hugely complex, logistics operation. It might involve components, assembly, or growing and processing things, shipping from one place to another, passing through multiple distribution and shipping hubs, customs, retailers and finally delivery to your store, or directly to you — a logistics chain that, taking all the world’s goods into account, has been estimated to be worth up to $12 trillion annually. Freight forwarding is the process by which all of that logistics works as it should, and in itself accounts for hundreds of billions of dollars in spend, and potentially more than $1 trillion in costs when things go awry.

Traditionally, a lot of freight forwarding work has been done offline, a messy process involving paper and faxing, prone to mistakes, over- and under-supply based on sales and typically hard to scrutinize because of the lack of centralized information. Companies like Zencargo — along with others in the same space like Flexport — have built digitized platforms to manage all of this, tracking items by SKU data, matching shipments with real-time insights into sales and demand, and balancing different kinds of freight options to provide the right items at the right time. (Zencargo works across sea, air and land freight, with sea accounting for about half of all of its traffic, Hersham said.)

Zencargo’s services arguably will continue to see demand growing in line with the growth of the logistics industry, but the curve balls of the last several years, and in the last 12 months in particular, that have impacted the shipping business lay out an interesting road ahead for the startup in the future.

“The freight industry has struggled to keep pace with innovation. Archaic processes are still in place across the board, resulting in widespread inefficiencies,” said Patrick Beitel, Managing Director and Founding Partner at Digital+ Partners, in a statement. “Zencargo’s cutting edge technologies, plus deep industry experience and knowledge, are transforming the supply chain, and that marries up perfectly with Digital + Partners’ mission to back companies with best-in-class technology and exceptional management teams. We are honoured to join them on the next stage of their journey.”

Toronto-based Wattpad is officially part of South Korean internet giant Naver as of today, with the official close of the $600 million cash and stock acquisition deal. Under the terms of the acquisition, Wattpad will continue to be headquartered in, and operate from Canada, with co-founder and Allen Lau remaining CEO of the social storytelling company and reporting to the CEO of Naver’s Webtoon, Jun Koo Kim.

I spoke to Lau about what will change, and what won’t, now that Wattpad is part of Naver and Webtoon. As mentioned, Wattpad will remain headquartered in Toronto — and in fact, the company will be growing its headcount in Canada under its new owners with significant new hiring.

“For Wattpad itself, last year was one of our fastest growing years in terms of both in terms of revenue and company size,” Lau said. “This year will be even faster; we’re planning to hire over 100 people, primarily in Toronto and Halifax. So in terms of the number of jobs, and the number of opportunities, this puts us on another level.”

While the company is remaining in Canada and expanding its local talent pool, while maintaining its focus on delivering socially collaborative fiction, Lau says that the union with Naver and Webtoon is about more than just increasing the rate at which it can grow. The two companies share unique “synergies,” he says, that can help each better capitalize on their respective opportunities.

“Naver is one of the world’s largest internet companies,” Lau told me. “But the number one reason that this merger is happening is because of Webtoon. Webtoon is the largest digital publisher in the world, and they have over 76 million monthly users. Combined with our 90 million, that adds up to 166 total monthly users — the reach is enormous. We are now by far the leader in this space, in the storytelling space, in both comics and fiction: By far the largest one in the world.”

The other way in which the two companies complement each other is around IP. Wattpad has demonstrated its ability to take its user-generated fiction, and turn that into successful IP upon which original series and movies are based. The company has both a Books and a Studios publishing division, and has generated hits like Netflix’s The Kissing Booth out of the work of the authors on its platform. Increasingly, competing streaming services are looking around for new properties that will resonate with younger audiences, in order to win and maintain subscriptions.

“Wattpad is the IP factory for user generated content,” Lau said. “And Webtoons also have a lot of amazing IP that are proven to build audience, along with all the data and analytics and insight around those. So the combined library of the top IPs that are blockbusters literally double overnight [with the merger]. And not just the size, but the capability. Because before the acquisition, we had our online fiction, we have both publishing business, and we have TV shows and movies, as well; but with the combination, now we also have comics, we also have animation and potentially other capabilities, as well.”

The key to Wattpad’s success with developing IP in partnership with the creators on its platform isn’t just that its’ user-generated and crowd-friendly; Wattpad also has unique insight into the data behind what’s working about successful IP with its fans and readers. The company’s analytics platform can then provide collaborators in TV and movies with unparalleled, data-backed perspective into what should strike a chord with fans when translated into a new medium, and what might not be so important to include in the adaptation. This is what provides Wattpad with a unique edge when going head-to-head with legacy franchises including those from Disney and other megawatt brands.

“No only do we have the fan bases — it’s data driven,” Lau said. “When we adapt from the fiction on our platform to a movie, we can tell the screenwriter, ‘Keep chapter one, chapter five and chapter seven, but in seven only the first two paragraphs,’ because that’s what the 200,000 comments are telling us. That’s what our machine learning story DNA technology can tell you this is the insight; where are they excited? This is something unprecedented.”

With Naver and Webtoon, Wattpad gains the ability to leverage its insight-gathering IP generation in a truly cross-media context, spanning basically every means a fan might choose to engage with a property. For would-be Disney competitors, that’s likely to be an in-demand value proposition.

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Today as we dig deep into Expensify, its history and its current ramp toward the public markets after reaching $100 million in ARR, a quick note on where we are in the world of exits.

If you are bored of IPOs, consider it a luxury. For years, the unicorn market was all hype and no liquidity. But in the last year or so, the public market has been a welcome and lucrative exit path for a host of unicorns. The same excitement that has led to record venture capital results in the private sector has been at play amongst public investors, boosting the value of many a former unicorn as they left their startup days behind them.

But an April pause led to some concern that the IPO market was cooling. News out today details an IPO climate that is warming once again. For Expensify, and other unicorns on the sidelines like Robinhood, it’s good news.

For one company in particular, warm IPO markets could not have come back at a better time. Let’s talk about Expensify.

A deep dive into Expensify ahead of its IPO

TechCrunch’s continuing series of deep dives on the most interesting startup companies continues this week, with the kickoff of our look at Expensify. Unlike some other companies we’ve profiled as part of our EC-1 series, like Tonal, perhaps, you’ve probably used Expensify’s software.

So you know the company in question. What you might not have known is just what a wild ride Expensify has been on during its startup life. From the introduction to the Expensify series, I present the following paragraph:

Most interestingly, this is a story about just not giving a damn about what anyone goddamn thinks, an approach to life and business that led to more than $100 million in annual revenue, and an IPO incoming on what looks to be a very quick timetable. Prodigious revenues, 10 million users and only 130 employees running the whole shebang — that’s a hell of an achievement in only 13 years.

You can read the first main piece here. The rest will be coming out over the next few weeks. Get hype!

Startups and venture capital

We have a lot to get through, so please excuse the following list of bullets:

• This founder raised millions to build Fair, a neobank for immigrants — The core promise of fintech is that it should apply technology to an ossified, inequitable and often iniquitous financial system. Fair wants to do that for immigrants via a neobank. And it’s doing it with alternative capital. Super cool.
• Crypto asset manager Babel raises $40M from Tiger Global, Bertelsmann and others — By this point in the business cycle, we should not be shocked at $40 million Series A rounds. Especially if Tiger is involved. In this case Babel is the recipient of the outsized round, with the startup busy at work building “a suite of [crypto] asset management products and services tailored to enterprise clients around the world,” Rita reports.
• Blind raises $37M to double down on workplace gossip and career advice — If your friends don’t send you Blinds on what is going on at their workplace, are you really friends? Maybe. But Blind has found a big niche with its focus on providing verified-ish gossip on companies you can name. Also journalists love it. As do, Danny reports, investors.
• Indy VC firm Sixty8 Capital launches $20M fund aimed at underrepresented founders — According to Ron, Sixty8 Capital is launching a “new $20 million fund aimed at providing early-stage funding for underrepresented founders” from “smack dab in the middle of the United States.” It’s not alone in raising capital in the Midwest; TechCrunch reported that M25 recently raised a new fund as well.
• Snack, a ‘Tinder meets TikTok’ dating app, opens to Gen Z investors — What is more Gen Z than a Tinder-TikTok mobile app tie up? How about Snack allowing its young users to invest in its upcoming round? The kids are just fine, it turns out. This is great.

4 lessons I learned about getting into Y Combinator (after 13 applications)

Can you imagine making 13 attempts at something before attaining a successful outcome?

Alex Circei, CEO and co-founder of Git analytics tool Waydev, applied 13 times to Y Combinator before his team was accepted. Each year, the accelerator admits only about 5% of the startups that seek to join.

“Competition may be fierce, but it’s not impossible,” says Circei. “Jumping through some hoops is not only worth the potential payoff but is ultimately a valuable learning curve for any startup.”

In an exclusive exposé for TechCrunch, he shares four key lessons he learned while steering his startup through YC’s stringent selection process.

The first? “Put your business value before your personal vanity.”

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

The tech giants

Tech’s bigger players have been busy today, giving us quite a lot to chew on. Facebook, for example, is taking fire from state lawyers arguing that its idea of building an Instagram for kids is a bad idea. Not that the complaints will stop Facebook from doing whatever it wants, but the level of criticism is notable. Facebook doesn’t have a lot of political goodwill to spend, these days.

Facebook is also following in Twitter’s footsteps in asking users to read articles before they share them. Because the world going digital has not yet stopped humans from being in need of chronic correction.

In order of descending market capitalization, Spotify is next on our list. The company is improving its social sharing capabilities, in essence boosting the ability of its users to share podcasts intelligently. As Sarah reports, “Spotify will also now allow users to share a time-stamped link to a podcast, which allows users to tune into a particular moment of the podcast episode.”

Thank everything, and it’s about time. Even if everyone who listens to my show uses Apple Podcasts.

Finally, enterprise storage, security and collaboration company Box is in the middle of a very public fight with an activist investor. In short, Box’s growth is slowing. While the company’s leadership is confident that it can restart its growth engine, outside parties want more control. Yoof.

Community

The fun thing about setting up something new like our Discord server is that it’s new. The tough thing about setting up something new (like the Discord server) is that it needs folks like you to come make it great. Join us! (New this week, a room about fintech and one dedicated to space!)