Author: azeeadmin

Sherpa, a startup from Bilbao, Spain that was an early mover in building a voice-based digital assistant and predictive search for Spanish-speaking audiences, has raised some more funding to double down on a newer focus for the startup, building out privacy-first AI services for enterprise customers.

The company has closed $8.5 million, funding that Xabi Uribe-Etxebarria, Sherpa’s founder and CEO, said it will be using to continue building out a privacy-focused machine learning platform based on a federated learning model alongside its existing conversational AI and search services. Early users of the service have included the Spanish public health services, which were using the platform to analyse information about Covid-19 cases to predict demand and capacity in emergency rooms around the country.

The funding is coming from Marcelo Gigliani, a managing partner at Apax Digital; Alex Cruz, the chairman of British Airways; and Spanish investment firms Mundi Ventures and Ekarpen. The funding is an extension to the $15 million Sherpa has already raised in a Series A. From what I understand, Sherpa is currently also raising a larger Series B.

The turn to building and commercializing federated learning services comes at a time when the conversational AI business found itself stalling.

Sherpa saw some early traction for its Spanish voice assistant, which first emerged at a time when efforts from Apple in the form of Siri, Amazon in the form of Alexa, and others hadn’t really made strong advances to address markets outside of those where English is spoken.

The service passed 5 million users as of 2019 — customers using its conversational AI and predictive search services include the Spanish media company Prisa, Volkswagen, Porsche and Samsung.

But as Uribe-Etxebarria describes it, while that assistant business is still chugging along, he came up against a difficult truth: the biggest players in English voice assistants eventually did add Spanish, and the conversational AI investments they would make over time would make it impossible for Sherpa to keep up in that market longer term on its own.

“Unless we did a big deal with a company, we wouldn’t be able to compete against Amazon, Apple and others,” he said.

That led the company to start exploring other ways of applying its AI engine.

It came on to federated privacy, Uribe-Etxebarria said, when it started to look at how it might expand its predictive search services into productivity applications.

“A perfect assistant would be able to read emails and know which actions to take, but there are privacy issues around how to make that work,” Uribe-Etxebarria said. Someone suggested to him to look at federated learning as one way to “teach” its assistant to work with email. “We thought, if we put 20 people to work, we could build something to read and respond to emails.”

The platform that Sherpa built, Uribe-Etxebarria said, worked better than they had anticipated, and so a year later, the team decided that it could use it for more than just triaging email: it could be productized and sold to others as an engine for training machine learning models with more sensitive data in a more privacy-compliant way.

It’s not the only company pursuing this approach: Tensorflow from Google also uses federated learning, as does Fate (which includes cloud computing security experts from  Tencent contributing to it), and Pysyft, a federated learning open source library.

Sherpa is working with several companies under NDAs in areas like healthcare and Uribe-Etxebarria said it plans to announce customers in other areas like telecoms, retail and insurance in the near future.

Sherpa, a startup from Bilbao, Spain that was an early mover in building a voice-based digital assistant and predictive search for Spanish-speaking audiences, has raised some more funding to double down on a newer focus for the startup, building out privacy-first AI services for enterprise customers.

The company has closed $8.5 million, funding that Xabi Uribe-Etxebarria, Sherpa’s founder and CEO, said it will be using to continue building out a privacy-focused machine learning platform based on a federated learning model alongside its existing conversational AI and search services. Early users of the service have included the Spanish public health services, which were using the platform to analyse information about Covid-19 cases to predict demand and capacity in emergency rooms around the country.

The funding is coming from Marcelo Gigliani, a managing partner at Apax Digital; Alex Cruz, the chairman of British Airways; and Spanish investment firms Mundi Ventures and Ekarpen. The funding is an extension to the $15 million Sherpa has already raised in a Series A. From what I understand, Sherpa is currently also raising a larger Series B.

The turn to building and commercializing federated learning services comes at a time when the conversational AI business found itself stalling.

Sherpa saw some early traction for its Spanish voice assistant, which first emerged at a time when efforts from Apple in the form of Siri, Amazon in the form of Alexa, and others hadn’t really made strong advances to address markets outside of those where English is spoken.

The service passed 5 million users as of 2019 — customers using its conversational AI and predictive search services include the Spanish media company Prisa, Volkswagen, Porsche and Samsung.

But as Uribe-Etxebarria describes it, while that assistant business is still chugging along, he came up against a difficult truth: the biggest players in English voice assistants eventually did add Spanish, and the conversational AI investments they would make over time would make it impossible for Sherpa to keep up in that market longer term on its own.

“Unless we did a big deal with a company, we wouldn’t be able to compete against Amazon, Apple and others,” he said.

That led the company to start exploring other ways of applying its AI engine.

It came on to federated privacy, Uribe-Etxebarria said, when it started to look at how it might expand its predictive search services into productivity applications.

“A perfect assistant would be able to read emails and know which actions to take, but there are privacy issues around how to make that work,” Uribe-Etxebarria said. Someone suggested to him to look at federated learning as one way to “teach” its assistant to work with email. “We thought, if we put 20 people to work, we could build something to read and respond to emails.”

The platform that Sherpa built, Uribe-Etxebarria said, worked better than they had anticipated, and so a year later, the team decided that it could use it for more than just triaging email: it could be productized and sold to others as an engine for training machine learning models with more sensitive data in a more privacy-compliant way.

It’s not the only company pursuing this approach: Tensorflow from Google also uses federated learning, as does Fate (which includes cloud computing security experts from  Tencent contributing to it), and Pysyft, a federated learning open source library.

Sherpa is working with several companies under NDAs in areas like healthcare and Uribe-Etxebarria said it plans to announce customers in other areas like telecoms, retail and insurance in the near future.

Stripe gets a mind-boggling valuation, Facebook promotes COVID vaccines and Elon Musk has an interesting new title. This is your Daily Crunch for March 15, 2021.

The big story: Stripe valued at $95B

That’s right: The popular payments company has raised $600 million in new funding at a $95 billion valuation. It says it will use the money to expand in Europe while also growing its global payments and treasury network.

“Whether in fintech, mobility, retail or SaaS, the growth opportunity for the European digital economy is immense,” said president and co-founder John Collison in a statement.

Meanwhile, over in Extra Crunch, Alex Wilhelm takes a closer look at the company’s new growth numbers, like the fact that it’s now working with more than 50 companies that are each processing more than $1 billion annually.

The tech giants

Facebook to label all COVID-19 vaccine posts with pointer to official info — The company says it has also implemented some “temporary” measures aimed at limiting the spread of vaccine misinformation/combating vaccine hesitancy.

His Majesty Elon the First, Technoking of Tesla — In Musk-speak, his new title still translates into the chief executive officer of the electric car company.

Netflix gets 35 Oscar nominations, including 10 for ‘Mank’ — Of course, this is a streaming-centric year for movies overall.

Startups, funding and venture capital

Airtable is now valued at $5.77B with a fresh $270 million in Series E funding — Airtable is a relational database that many describe as a souped-up version of Excel or Google Sheets (and there’s at least one TechCrunch editor who swears by it).

WeWork unbundles its products in an attempt to make itself over, but will the strategy work? — The pandemic presented WeWork with challenges, but also, some might say, opportunity.

ElevateBio raises $525M to advance its cell and gene therapy technologies — The company’s business model focuses on both developing and commercializing its own therapies, while also working through long-term partnerships with academic research institutions.

Advice and analysis from Extra Crunch

Julia Collins and Sarah Kunst outline how to build a fundraising process — Collins is the first Black woman to co-found a venture-backed unicorn, so it should come as no surprise that investors lined up to bet on her latest venture.

Olo raises IPO range as DigitalOcean sees possible $5B debut valuation — It’s a busy day in IPO-land.

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

Everything else

US e-commerce on track for its first $1 trillion year by 2022, due to lasting pandemic impacts — The COVID-19 pandemic boosted U.S. online shopping by $183 billion, according to a new report by Adobe’s e-commerce division.

BMW debuts the next generation of its iDrive operating system — With its new system, BMW is expanding the center dashboard display all the way through the cockpit.

4 signs your product is not as accessible as you think — Bringing decades-long legacy code and design into the future isn’t easy.

The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 3pm Pacific, you can subscribe here.

GitHub has reached an “amicable resolution” with the person the company fired in the aftermath of the attack on the U.S. Capitol in January, the former employee told TechCrunch.

On the day a violent mob of Trump supporters stormed the U.S. Capitol, a worried GitHub employee warned his co-workers in the D.C. area to be safe. After making a comment in Slack saying, “stay safe homies, Nazis are about,” a fellow employee took offense, saying that type of rhetoric wasn’t good for work, the former employee previously told me. Two days later, he was fired, with a human relations representative citing a “pattern of behavior that is not conducive to company policy” as the rationale for his termination, he previously told me.

Later that month, GitHub COO Erica Brescia said the company’s head of HR took full responsibility for what happened and resigned from the company yesterday. GitHub did not disclose the name of the person who resigned, but it’s widely known that Carrie Olesen was the chief human resources officer at GitHub. At that time, GitHub said it also “reversed the decision to separate with the employee” and was talking to his representative.

The fired employee, however, did not take his job back.

Instead, he told me, “me and the company reached an amicable resolution. I appreciate that they have denounced white supremacy and the dangers it poses to everybody.”

He did not specify the terms of the resolution, but he previously told me he was seeking damages or some other form of reconciliation.

Below is his full statement, which he requested we publish in full:

Me and the company reached an amicable resolution. I appreciate that they have denounced white supremacy and the dangers it poses to everybody.

We all saw on January 6 that the greatest threat to the USA is not Islam, Black
Lives, or defunding police.

White supremacy has us all held hostage using feigned civility, bad-faith arguments/negotiations, and amtssprache*, and it does not stop until we are all dead or subjugated. I am glad that the nazi coup was a failure, and we avoided a successful Reichstag fire. That said, nazis do not give up easily.

Keep your families and communities safe. Connect with your neighbors and local stores. Fascism and nazism succeed when we are divided. They demand that you abandon reason, that you acquiesce to power and hierarchy, and that you shun altruism. Love yourself. Support, join or create local unions. Build community. Don’t entertain nazis.

I appreciate those who have supported me and my family. I wish you safety and wellness.

Black Lives Matter & Black Power 

*Amtssprache
https://heartlesshypocrisy.com/what-is-amtssprache/

Enjoyment & learning for these times

Graphic novels:
Maus
Y the Last Man
Pulp
Sweet Tooth

Songs:
“Algorhythm” by Childish Gambino
“Plegaria a un Labrador” by Victor Jara
“Tweakin” by Vince Staples
“Operation: Mindcrime” by Queensrÿche

Shows:
Avatar Last Airbender & Legend of Korra
Attack on Titan
Atlanta
The Wire

Books:
Gang Leader for a Day by Sudhir Venkatesh
People & Permaculture by Looby Macnamara
The Ways of White Folks by Langston Hughes
Post Traumatic Slave Syndrome by Dr. Joy DeGruy

Movies:
Persepolis
Inglorious Basterds
Attack the Block
Shawshank Redemption

Gumroad, a startup that helps creators sell their work, is raising $6 million at a $100 million valuation. While $1 million of that total is reserved for AngelList co-founder Naval Ravikant and Basecamp founder Jason Fried, the remaining $5 million is being raised with a twist: anyone willing to fork over at least $100 bucks can invest in the round.

Founded by Sahil Lavingia, Gumroad is using a new SEC regulation, passed today, that increases the maximum amount of money that can be raised in an equity crowdfunding campaign. Now, investors and founders can raise up to $5 million per year from crowdfunding, up from $1.07 million the year prior.

The increase might not turn heads in a world of $90+ billion valuations, but Lavingia thinks the new rules could revitalize a path to raising capital for venture capitalists and founders alike. Unaccredited investors — whether its users, friends or non-accredited investors — could become the new limited partners.

“If this works, startup founders will start to be able to go direct more frequently,” Lavingia said.

Despite venture capital growing as an asset class, alternative ways to raise are becoming increasingly popular to help founders maintain ownership and to access capital.

Up until this point, Gumroad has raised more than $8 million from investors, including Kleiner Perkins, First Round, Max Levchin and SV Angel, as well as others, since 2011. But today marks what Lavingia views as a long-term shift in how Gumroad raises capital. If all goes well, Gumroad will continue raising via crowdfunding on an annual basis until it goes public.

Now that companies can raise $5 million per year through crowdfunding, platforms like WeFunder, StartEngine, SeedInvest and Republic, which Lavingia is using, have a better chance to shake up the modern fundraise.

So far, Gumroad has raised $3.4 million of its $5 million goal across commitments from 3,458 investors. Investors in the crowdfund include part-time creators on Gumroad, Lavingia’s Twitter followers, YouTubers, as well as Figma founder Dylan Field and partners from VC firms. In order to promote a diversity of investors, Gumroad has capped total investments from individuals at $1,000 for the first few days.

The startup is giving up 6% of ownership as part of the financing event, and the investors will only receive equity stakes once the SAFE note turns into a round. This process could take a year, Lavingia said. The conversion round to make it happen could be an IPO, acquisition or $10 million priced round. The priced round will likely happen next year through a Reg A round, the annual limit of which is $75 million, the founder said.

The SAFE’s cap is placed at a present-day 3.5x revenue multiple. In 2020, Gumroad brought in $9.2 million in net revenue, up 87% from the year prior, generating $1.08 million in net profit, up 286% from the year prior.

Background

The new, higher crowdfunding investing cap has some downsides, according to institutional investors. A simple one is that it is an administrative burden to give hundreds of people equity in your company for a small amount of money. Another issue, one investor told TechCrunch, is that institutional investors are sometimes experts in investment areas, which is helpful in a way hundreds of smaller investors might not be. Finally, the max of crowdfunding is still $5 million a year, so the method may be less effective for later-stage companies like, say, Stripe, which needs traditional investors to buy in.

Despite these concerns, the recent Gumroad raise is a continuation of two trends of which Lavingia has been on the forefront: building in public and the democratization of venture capital. He livestreams every Gumroad board meeting through Clubhouse and Zoom, and shares business metrics that most private companies decline to report, such as revenue and profit. (In fact, I knew about this plan to raise months ago after reading one of his newsletters.)

Readers will also remember that Lavingia was one of the first people to use the AngelList platform to create a rolling fund, which uses a 506(c) SEC regulation that allows investors to publicly solicit investments on an ongoing basis. The move was met with controversy at first, since venture capital funds have historically been raised behind closed doors.

“People were upset at the rolling fund, so imagine when they see that you are cutting out the whole industry [of venture capital],” Lavingia said, referring to a conversation he had with AngelList’s Ravikant.

One thing to be wary of, Lavingia says, is the Testing the Waters dynamic. Under Reg CF and A+, startups are able to differentiate between offering and selling securities. Offering simply allows a founder to “test the waters” and see if interest is there for a crowdfunded round. Despite this guardrail, commitments aren’t capital. For example, a startup could get $1 million in commitments but wind up only raising $100,000, Lavingia said. The conversion rate for intended buys versus actual buys could leave some founders in a thorny spot.

His way for combating this is to be obvious about red flags and transparent, which is already in line with Gumroad’s thesis.

“I preceded this fundraise with a blog post that I’m the only person who works on Gumroad as an employee,” he said. “I want to scare off anyone who is like this is weird [from investing].”

Other than Lavingia, Backstage Capital’s Arlan Hamilton has used Republic to crowdfund her firm’s operating fees. Hamilton made history earlier this month when she raised $1 million in eight hours for her fund. Today, she similarly opened up investments in her firm in light of the new cap and has already closed $2.4 million.

When Hamilton spoke about the raise at TC Sessions: Justice, she said she expects another asset class to be born because venture is a “broken” and “old” system.

“I’ll probably pivot Backstage, we’ll find ways and we’ve already started,” she said. “If you look at our raise we did in the Republic, it didn’t exist the way we wanted it to exist, this ability to go to the crowd as a fund.”

“The way it starts is not by a normal person doing it,” Lavingia said. “It’s by someone who is at the tip of the spear, someone who has an interesting angle, and then it gets sort of democratized over time.”

The fact that a founder turned part-time venture capitalist is using crowdfunding to raise money for his own company is a meta headache on its own. But the founder sees this as an opportunity to make crowdfunding mainstream and an attractive asset class.

Long-term, a public crowdfunding round in startups could be just a small drop in a startup’s financing pre-exit, but one that could empower thousands of normal people to own startup equity for the first time.

“I’m basically trying to become a private-market Chamath,” he said, referring to the billionaire behind Social Capital credited with the recent boom in popularity around SPACs. “I want to build a huge brand associated with investing in private equities, startups, and having an army of people that I can use and wield in different ways.”

Every once in a meme-ified blue moon, the wildly irrational cryptocurrency ecosystem gives birth to something that might outlive the hype.

The crypto art hype may be silly and expensive, but it might also empower artists from emerging economies and under-represented groups to access the global art market in ways that they couldn’t before.

On March 5, Twitter CEO Jack Dorsey auctioned off a blockchain receipt, called a non-fungible token (NFT), for a screenshot of his first tweet in 2006, and bids for it promptly exceeded $2.5 million. Since 2018, people have spent roughly $237 million on NFTs, with the vast majority of those funds spent since the trend exploded in January 2021.

Bryana Kortendick, VP of operations and communications at the NFT startup Enjin, said the platform and corresponding NFT wallet’s growth is up 100 percent since December 2020, now tallying more than 47,426 registered users. Her company was funded by a token sale in 2017 that amassed 75,041 ether (ETH), worth more than $130 million today. Kortendick declined to comment on how the cryptocurrency treasury is managed, other than to say they have enough runway for the startup’s continued growth because “Enjin has retained a portion of the funds raised through our ICO in ETH.”

As of 2021, Kortendick said the wallet app’s fastest-growing markets include the United States, Korea, the United Kingdom, Iran, Germany, Canada, India, Indonesia, Turkey and Australia. In sanctioned countries like Cuba, Iran and Venezuela, NFTs provide one of the only ways for up-and-coming artists to transact with global art collectors. It can also be a way for dancers to make money by selling NFTs with GIFs showcasing specific moves or NFTs that allow video game characters to dance a specific move.

“There has been an influx of new [app] users in countries like Iran, and we are working to localize the app accordingly to make it more accessible for these growing markets,” Kortendick said. “We recently saw a surge of [web] users in Cuba too, which prompted us to translate our entire website into Spanish.”

A new world coming under compliance

It remains to be seen if that type of market activity is sustainable, with regards to compliance across jurisdictions.

The U.S. Treasury penalized the crypto company BitGo in 2020 for allowing users to transact with people in sanctioned countries. Maintaining financial sanctions appears to be one of the regulator’s priorities in 2021. In any case, companies can delist artists and pieces, which means anyone who isn’t fluent in command-line Ethereum tricks can lose access to their NFTs. It will still exist “on the blockchain,” yet it would be quite a stretch to call NFTs “permissionless” art, as many blockchain advocates do.

Amid growing competition from Twitter Spaces and other newcomers, popular social audio startup Clubhouse is making a move aimed at seeding its network with more high-quality content: it’s launching an accelerator program. During its weekly town hall event on Sunday, the company detailed its plans for its inaugural accelerator called “Clubhouse Creator First,” which will initially help around 20 creators get their shows off the ground. To do so, Clubhouse said it will provide creators with anything they need to get started — whether that’s equipment like an iPhone, AirPods, or an iRig, promotional support or help with booking guests, or even a babysitter. Most importantly, Clubhouse is promising the participating creators an income of some sort.

During the town hall, Clubhouse CEO Paul Davison explained that a core part of the accelerator experience will be to help creators get paid for their work. In order to make this happen, Clubhouse will match the creator with a brand sponsor, he said — something the company believes will be possible because brands are already reaching out to Clubhouse looking for opportunities to get involved.

“We have all of these brands coming to us, asking how they can help — how they can host conversations and find people who can help them host those conversations,” he said.

In the case that Clubhouse can’t find a brand sponsor for a particular show, the company will just guarantee a basic income of $5,000 per month during the three months the creator is participating in the program.

Presumably, this cushion could help people transition from other projects to focus on their Clubhouse show instead, while also giving them time to grow their audience and form the brand relationships that could sustain their shows longer-term.

Clubhouse will also play a hands-on role in helping to develop the shows from the accelerator’s participants, we understand.

Already, the Andreessen Horowitz-backed social audio app has aided in the success of one of its more popular tech programs, The Good Time Show, co-hosted by the VC firm’s latest general partner, Sriram Krishnan. His program has regularly featured guests and co-hosts either investing with the firm or connected to it somehow, and has been responsible some of Clubhouse’s biggest celeb guests — like Elon Musk and Mark Zuckerberg, for example.

That formula could be repeatable, it seems. As Davison noted during the town hall: “we’ll work on matching you with guests for your shows — for your events.” In other words, it’s helping produce.

Davison also said Clubhouse will offer directed feedback to the accelerator’s participants, including its opinion on what works and what doesn’t, and other “deep dive concept development.” When the creators’ shows are ready to launch, Clubhouse will then connect them with creative services to help design promotional materials to market the shows outside of the social app. It may even give the creators invites they can dole out to potential listeners to help them build up the show’s initial audience, if need be.

Of course, Clubhouse has been doing some of this kind of work behind the scenes before today, but the accelerator both formalizes the arrangement and devotes dedicated resources to a larger handful of promising creators.

But it also puts Clubhouse in a potentially precarious position with regard to its still underdeveloped moderation practices.

Brands are typically hesitant to associate themselves with problematic or toxic content, and will pull out of creator deals and relationships if they find that to be the case. In the past, content moderation failures have led to advertisers’ exodus from top social platforms — like the YouTube brand freeze a few years ago over obscene comments, which necessitated a cleanup of the videos allowed on the YouTube ad network. And last year, Facebook faced its largest corporate boycott to date, when brands protested the company’s failures to properly prevent the spread of hate speech and misinformation on its platform.

Though small by comparison — the app now has 12 million global downloads, App Annie says — Clubhouse has already been called out for allowing misogyny, anti-Semitism and COVID-19 misinformation on the platform, despite rules against prohibiting this content. It’s also allowed for verbal abuse, with some users still being name-called or harassed in Clubhouse rooms. (We’ve heard these stories from users directly but will not name names without permission.).

More recently, there’s been growing concern about scam artists taking over Clubhouse and the lack of accountability for what’s being said. Many so-called “experts” are happy to go on the app to dole out advice, but when they wade into territory like mental health, they can spread harmful misinformation that can really hurt people.

All these things could potentially catch up to Clubhouse in a big way in the months to come, if the company can’t figure out a better moderation strategy to weed out the bad actors and keep the platform brand-safe.

Starting today, the company is allowing interested creators to apply for Clubhouse Creator First. The deadline to apply is March 31, 2021.

The program was one of several town hall announcements on Sunday.

The company also announced it has hired a Netflix, OWN, and Harpo Productions alum Maya Watson as its new head of global marketing, and it detailed several new product updates.

Among those, users will now be able to invite people to the app by phone number alone, instead of having to upload their entire address book. It also now allows users to share links that point to their user profile or Club page, and will now better remember a user’s language preferences when displaying its list of rooms, among other things.

Kelauni Jasmyn, general partner at the new Black Tech Nation Ventures, can explain her aims for the new firm quite succinctly: “The goal is to get more Black people funded.”

That’s something Jasmyn has been working on already with Black Tech Nation, a Pittsburgh-based organization that supports Black entrepreneurs with education, content, community and more. Now she’s tackling the funding size of the equation more directly by raising a $50 million first fund with her fellow GPs Sean Sebastian and David Motley.

“We’re really at the beginning of something brand new, that I think will be historic and offer a literal economic shift for the Black community in building generational wealth,” Jasmyn said. “We get to be the ones who mold the foundation of that.”

Sebastian is a partner at Birchmere Ventures, a seed fund also based in Pittsburgh, while Motley is co-founder of BlueTree Venture Fund and African American Directors Forum. Sebastian also suggested that he and Motley are involved partly to enable a “transfer of knowledge” that will empower a new generation of Black investors, starting with Jasmyn.

Motley, meanwhile, suggested that this is an effort to take “take the Black Tech Nation platform and combine it with the Birchmere platform.” He recalled speaking to Jasmyn for the first time at Sebastian’s urging and immediately responding, “Sean, this is the real deal.”

All three of BTNV’s partners emphasized that while the fund has a social mission, they’re also focused on financial returns. 

“We are no different than any other fund just because you put a specific community around it,” Jasmyn said. “You shouldn’t expect any less valuable returns. We just happen to have the advantage of untapped potential.”

The fund will make seed and Series A investments, and Motley said they’re focused on software startups — which could be software as a service, B2B or B2B2C. These ideas can be pre-revenue and even pre-product, but they need to be “scalable and lend themselves to significant value creation.”

Sebastian added that although BTVN is based in Pittsburgh, they’ll look at investments across the country, particularly entrepreneurs that come from outside Silicon Valley.

I wondered whether the fund’s financial goals could, at times, conflict with the more inclusive approach of Black Tech Nation, but the partners countered that the for-profit fund and nonprofit organization can actually complement each other. Motley said that Black Tech Nation “gives us more opportunities to say yes,” while Jasmyn suggested that if the venture fund has to turn someone down, she can still tell them, “Scoot over across the street [to Black Tech Nation] and maybe we can revisit this another time.”

Fondeadora, a fintech startup based in Mexico City and building a challenger bank, has extended its Series A funding round. I covered the company’s original round back in August 2020. And now, Fondeadora is adding $14 million on top of the original $14 million it had already raised — it now represents a $28 million funding round.

Portag3 is investing in the extension. Google’s Gradient Ventures, an existing investor in the company, is putting more money in Fondeadora. Gokul Rajaram and Anatol von Hahn are investing as business angels as well.

As a reminder, Y Combinator, Scott Belsky, Sound Ventures, Fintech Collective and Ignia also participated in the first tranche of the Series A.

“We received an unsolicited and unexpected term sheet three months after our Series A,” co-founder and co-CEO Norman Müller told me. The company’s valuation has doubled with the round extension as well.

Image Credits: Fondeadora

As most people still rely heavily on cash in Mexico, creating a challenger bank represents a good opportunity. In addition to customers from legacy banks, Fondeadora can become the first bank account for many people.

Fondeadora doesn’t operate any branch for its banking service. When you create an account, you receive a Mastercard debit card a few days later. There are no monthly subscription fee and no foreign transaction fee.

Like other challenger banks, your balance is updated instantly. You can choose to receive push notifications for transactions. You can also lock and unlock your card from the app.

More recently, the company launched a card without any personal info or card numbers — a bit like the Apple card in the U.S. On the back of the card, you can find a QR code. This way, you can show your card to your friends. They scan the code and you receive money a few seconds later.

Venmo launched a credit card with a QR code in the U.S. as well. I think challenger banks and peer-to-peer payment apps around the world should all do this as it’s a great bridge between the physical world and an app.

Fondeadora acquired a bank charter and now has plenty of money on its bank account. It sounds like things are working well so far and proves once again that banking is not a global industry. There’s room for plenty of local players around the world.

From distributed homes in Cambridge, Mass. and Cambridge, England, inBalance Research is joining Y Combinator as it looks to accelerate its business as the oracle for independent energy providers, utilities, and market makers.

Selling a service it calls Delphi, the very early stage startup is hoping to provide analysis for power producers and utilities on the demand forecasts of energy markets.

The orchestration of energy load across the grid has become a more pressing issue for utilities around the country after witnessing the disastrous collapse of Texas’ power grid in response to its second “once-in-a-century” storm in the last decade.

“If we want to address the solution longterm, it’s a two part solution,” said inBalance co-founder and chief executive, Thomas Marge. “It’s a combination of hardware and software. You need the right assets online and you need the right software that can ensure that markets operate when there are extreme market shocks.”

Prices for electricity change every 15 minutes, and sometimes those pries can fluctuate wildly. In some places, even without the weather conditions that demolished the Texas grid and drove some companies out of business, prices can double in a matter of hours, according to inBalance.

That’s what makes forecasting tools important, the company said. As prices spike, asset managers of finite responsive resources such as hydro and storage need to decide if they will offer more value to the market now or later. Coming online too early or too late will decrease the revenue for their clean generation and increase peak prices for consumers.

The situation is even worse, according to the company, if storage and intermittent renewables come online at the same time. That can create downward price pressure for both the storage and renewable assets, which, in turn, can lead to increased fossil fuel generation later the same day, once cleaner sources are depleted.

The software to predict those pressures is what inBalance claims to provide. Marge and his fellow co-founders, Rajan Troll and Edwin Fennell have always been interested in the problems associated with big data and energy.

For Marge, that began when he worked on a project to optimize operations for wind farms during a stint in Lexington, Mass.

“Fundamentally we’re a data science solution,” said Marge. “It’s a combination of knowing what factors influence every single asset on every single market in North America. We have a glimpse into how those assets are going to be working one day before to one hour before in order to do price forecasting.” 

So far, one utility using the company’s software in the Northeast has managed to curb its emissions by 0.2%. With a focus on renewables, inBalance is hoping to roll out larger reductions to the 3,000 market participants that are also using its forecasting tools for other services. Another application is in the work inBalance is conducting with a gas peaker plant to help offset the intermittency of renewable generation sources.

The reduction in emissions in New England is particularly impressive given that the company only began working with the utility there in December. Given its forecasting tools, the company is able to provide a window into which assets might be most valuable at what time — including, potentially, natural gas peaking plants, hydropower, pumped hydropower (basically an energy storage technology), battery or flywheel energy storage projects and demand response technologies that encourage businesses and consumers to reduce consumption in response to price signals, Marge said.

Already, six companies have taken a trip to see the Delphi software and come away as early users. They include a global renewable asset manager and one of the top ten largest utilities in the U.S., according to Marge.

“We use machine learning to accurately forecast electricity prices from terabytes of public and proprietary data. The solution required for daily power system stability is both hardware—like storage and electric vehicle charging—and the software required to optimally use it. inBalance exists to be that software solution,” the company said in a statement.