Monthly Archives: May 2021

News: Final-mile fulfillment startup parcelLab closes $112M Series C funding led by Insight Partners

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Munich-based parcelLab, which offers a final-mile fulfillment service for online retailers, has closed a $112 million (GB£80 million) Series C funding round led by the US VC/PE firm Insight Partners. Germany’s Endeit Capital participated as a co-investor, alongside existing investors Capnamic Ventures and coparion. parcelLab last raised an undisclosed Series B in October 2019. The

Munich-based parcelLab, which offers a final-mile fulfillment service for online retailers, has closed a $112 million (GB£80 million) Series C funding round led by the US VC/PE firm Insight Partners.

Germany’s Endeit Capital participated as a co-investor, alongside existing investors Capnamic Ventures and coparion. parcelLab last raised an undisclosed Series B in October 2019. The new funding will feed into parcelLab’s global expansion plans and new product development.

Founded in 2015 by Tobias Buxhoidt (CEO), Julian Krenge (CTO), and Anton Eder (COO), the startup has managed to bag such customers as Lidl, to which it provides automated personalized shipping messages. This means that as much as 85% of Lidl customers return to its website.

It also works with IKEA and Farfetch to increase basket sizes and email open rates of – it claims – over 90%, 25% reductions in WISMO (where is my order), and increases of customer reviews.   

In a statement Tobias Buxhoidt, CEO and Founder of parcelLab, said: “As e-commerce becomes increasingly competitive, providing unique and branded experiences will drive growth. Identifying opportunities to further connect with people and build a better, stronger relationship is a key differentiator.”   
 
Matt Gatto, Managing Director at Insight Partners, said: “We pride ourselves in identifying and investing in software ScaleUp companies that are driving transformative change in their industries. In parcelLab, we see true potential to transform how brands and people connect.”

Endeit only recently raised a €250 million fund to invest in B-stage European startups, so this is its most recent deployment of capital.

Philipp Schroeder Partner at Endeit commented: “ParcelLab’s team is the perfect example of internet entrepreneurs that we want to support – entrepreneurs who can drive the change to make Europe more competitive and who have the ambition to become global market leaders.” 

ParcelLab’s main competitor is US-based Narvar which has raised $64M, with its last round being a Series C funding.

News: The motorcycle ride-hailing wars in Nigeria and Uganda is SafeBoda’s to lose

• May 11, 2021
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On April 16, Uganda-based two-wheel ride-hailing platform SafeBoda announced that it had completed 1 million rides in Ibadan, a southwestern city in Nigeria. This might not seem spectacular from a global perspective because it took the startup a year and two months to achieve but it’s a noteworthy feat in African markets. Ibadan is one

On April 16, Uganda-based two-wheel ride-hailing platform SafeBoda announced that it had completed 1 million rides in Ibadan, a southwestern city in Nigeria. This might not seem spectacular from a global perspective because it took the startup a year and two months to achieve but it’s a noteworthy feat in African markets.

Ibadan is one of the cities where SafeBoda operates. The company, which first launched in Uganda, is disrupting the offline market of local motorcycles referred to as boda-bodas in Uganda and okadas in Nigeria.

In 2017, SafeBoda officially started operations in Kampala and almost immediately began to deal with the threat posed by new entrants at the time: uberBODA and Bolt boda.

Uber and Bolt are two of the most well-known ride-hailing companies in the markets in which they operate. Uganda was the first African country the pair decided to test out their two-wheel ride-hailing ambitions and it was the second market globally after Thailand for Uber. So given the clout and money these companies hold, most people anticipated they would give SafeBoda a run for its money. But that didn’t happen.

According to Alastair Sussock, co-CEO of SafeBoda, who founded the company with Ricky Rapa Thomson and Maxime Dieudonne, SafeBoda was clocking about 1,000 rides daily at the time. He argued that even though the company’s volumes were one of the best, there was a misrepresentation in the media that SafeBoda wasn’t in the league as other platforms.

“Everyone thought Uber and Bolt would enter Africa to revolutionize the informal boda market,” Sussock told TechCrunch. “There was mention of other players, some of which have folded now, but no one mentioned SafeBoda although we were actually doing quite good stuff. And that energized us to prove the perception wrong, which was that SafeBoda didn’t really exist”.

Strategy, hard work and a large Series B investment followed the next couple of years, which has established SafeBoda as a market leader in Uganda. Sussock said the company now completes about 40,000 rides a day. Uber and Bolt barely complete 10,000 rides in the country.

So what has been pivotal to this growth? Before founding SafeBoda, Rapa Thomson was also a boda rider. As the company’s director of operations, he’s pivotal in making sure the company adopts localized methods with its riders. And despite its exciting features, pieces of equipment and safety measures employed, what stands out is how SafeBoda adapts to the boda boda community. This has been responsible for the 80% year-on-year retention the company currently enjoys, Sussock said.

“We tend to localize our product and take a local approach where we hire local guys to be part of the team. They help to have boots on the ground and of course, what you see with Nigeria, is not as much a dissimilar story,” the co-CEO added.

When starting in Nigeria, most two-wheel ride-hailing startups begin from Lagos, the nation’s hotbed of commerce and transport. In recent times, the city has had entrants like Opera’s OPay, Gokada and MAX.ng. These startups, like SafeBoda, are heavily backed by U.S., Chinese and Japanese investors. They have been at loggerheads with each other to capture on-demand mobility market share in Africa’s most populous country.

SafeBoda first hinted at a possible expansion into Nigeria in 2019. All the aforementioned ride-hailing companies were already in operation and it appeared as if SafeBoda was a very late entrant. But according to Babajide Duroshola, the country head for SafeBoda in Nigeria, the team knew it was going to thrive in spite of the timing and what competition looked like. “For us, it was a no-brainer decision to come into Nigeria and do the same thing that we did at Kampala, which is to grow quickly and make SafeBoda a household name,” he said to TechCrunch. 

When time came to reveal which city it was going to start with, it was Ibadan, not Lagos. SafeBoda caught everyone unawares with the decision and subsequently faced heavy backlash. This was in December 2019 but fast-forward to February 2020; it proved to be a masterstroke because in one fell swoop, the Lagos State government rendered bike-hailing operations obsolete with new regulations. For the next couple of months, SafeBoda was the only reliable source of two-wheel ride-hail service in the country. While the regulations forced others to pivot into asset financing for bikes and logistics services, SafeBoda was waxing strong with its ride-hailing operations in Ibadan.

In its first five months, SafeBoda had completed more than 250,000 rides and onboarded thousands of drivers. Once again, adopting a local strategy and community building proved vital to the seemingly modest but explosive growth it experienced in a market no company had really tested.

“One of the things that really separated us from all the other guys in the market was a localization play. The fact that we could connect with and employ these people who were okada drivers right off the streets to become part of our operations team was very key,” Duroshola said.

The country manager added that SafeBoda’s progress showed other two-wheel operators that a market outside Lagos existed. “Lagos is the commercial capital. There’s a lot of money in the city and income per household is high. But then, it is not a true representation of Nigeria. We saw that if you really want to scale across the country, Ibadan was actually a very good place to start because it had all the kinds of people you’d typically find in Nigeria.”

The ease of doing business for a ride-hailing platform in Ibadan is also easier than in Lagos. The latter is known for endorsing NURTW, a transport group known to legally extort riders daily or weekly in the city. Such activities are prohibited in Ibadan giving SafeBoda a smooth path to achieving scale and allowing its drivers to work effectively.

A year in the city has rewarded the company with over 2,500 drivers and 40,000 customers. Together, they performed more than 750,000 trips in SafeBoda’s first year, which has since surpassed more than 1 million trips.

SafeBoda’s progress in Uganda and Nigeria makes it one of the most active players in Sub-Saharan Africa. The company has completed more than 35 million rides across both countries, with over 25,000 registered riders. It also claims to hold more than 80% market share in the two countries.

Despite this success, SafeBoda struggled in its third market, Kenya — a market it expanded to and left before Nigeria. The company had onboarded over 1,500 riders in less than a year, but it wasn’t growing at the pace it wanted. The pandemic made SafeBoda’s struggles obvious and per this report, riders’ dissatisfaction with pricing caused an upheaval that sent the company out of the Kenyan market.

In addition to rider troubles, Sussock noted that Kenya’s motorcycle taxi market wasn’t as highly dense as Uganda and Nigeria which, according to him, contributed to the exit.

“We were the market leader in Kenya, and we were doing like the most rides in Kenya. But it was still quite small in terms of volume compared to Uganda. And we knew what the potential would be in Nigeria, which we hadn’t done at the time. So it was just quite clear that Kenya, while very developed for tech, and developed per capita, was just really quite hard to scale in terms of motorcycle taxi transportation,” he said.

SafeBoda isn’t ruling out a return to the East African market. But with the East African market out of the way for now, it has the resources to focus ride-hailing efforts on Uganda and Nigeria. The ultimate goal, however, is to scale its super app play.

In Uganda, it is already in motion. SafeBoda offers on-demand food, grocery, pharmacy, essentials and beverages delivery services, of which more than 500,000 orders have been completed. This model is inspired by the Go-Pay model at GoJek, where two-wheel ride-hailing was an entry point to high-frequency wallet spend behavior.

The Asian multi-service company is one of the investors in SafeBoda via its GoVentures arm. Other backers include Transsion Holdings, Beenext, and serial entrepreneur Justin Kan.

SafeBoda has no real competition in the bike-hailing wars in Uganda and Nigeria as it stands. The company’s challenge remains the large offline market, where more than 1.5 million rides are completed daily in Uganda alone. The plan for SafeBoda is to convert more of this base to its existing online market share. Additionally, it wants to expand into P2P, merchant and bill payments and grow its on-demand business in Uganda. Its plan in Nigeria? Maintaining its core transport business before venturing into payments and deliveries.

News: Engageli nabs $33M more for its collaborative video-based teaching platform

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As schools move more widely into reopening their doors for in-person learning, many educational institutions have also learned a critical lesson in the last year. Having better tools to teach remotely are critical for situations when the physical experience has to be shut down, but even when things are “back to normal”, better tech can

As schools move more widely into reopening their doors for in-person learning, many educational institutions have also learned a critical lesson in the last year. Having better tools to teach remotely are critical for situations when the physical experience has to be shut down, but even when things are “back to normal”, better tech can still enhance what educators and students can do, and to whom teaching can be delivered. Now, a startup betting on virtual learning in higher education — and investing in the innovation to deliver that — is announcing a round of funding as it continues to expand its business.

Engageli, which has built an online teaching platform from the ground up — providing not just its own built-in-house video technology to deliver lectures and enable conversations, but tools to enable students to “sit” in study groups to work together; and features to share and annotate lecture notes, take quizzes and more — has picked up $33 million in funding.

CEO Dan Avida — who co-founded the company with his wife Daphne Koller (the Coursera co-founder) and Serge Plotkin — said the startup will be using to continue building more tools and scaling its platform and opening it up to more schools, specifically the bracket of higher learning colleges and universities that it targets as customers, as these institutions continue to embrace the promise of better video tools both for delivering live lessons, and also to develop more on-demand and other features around Engageli’s video platform.

“At first the priority was on the best synchronous experience,” Avida said in an interview of the priorities of universities when it came to remote learning. “Now everyone is much more focused on multi-modality.”

The funding, a Series A, is being co-led by Maveron and another (unnamed) investor and also includes participation from Corner Ventures, Good Friends, Educapital, and what Engageli describes as several “prominent individual technology executives.”

Notably, the funding is coming only seven months after the startup first emerged from stealth in October 2020, and investors from the $14.5 million seed round that it announced at the same time are also participating. The startup has now raised over $47 million and is not disclosing its valuation.

While there are now dozens, maybe even hundreds, of tools to help students learn things without being inside a traditional classroom, Engageli has taken a slightly different approach from the pack by building its video-based platform from the ground up with educational aims in mind.

This is already a step change, when you think about it, from the likes of Teams from Microsoft, Google Classroom, or Zoom. These are three of the most commonly used video platforms in educational settings, but they are all based on technology that was, essentially, originally built with more enterprise and generic purposes in mind.

From this, Engageli has worked on expanding the platform with tools that enhance not just the video experience, but enhance it in ways that make sense for educators and learners — that is, tools that are intuitive to use for those teaching and studying.

 

Up to now, these have focused on both the kinds of conversations that students can have with each other and the teacher, and ways for the teacher to keep their students engaged, by way of quizzes, notes that they can download and annotate and Q&A channels. For now, Engageli is focused on building its own technology, but over time you can see how the platform might open up to link up with bigger learning management systems and the other tools that institutions might already be using regularly.

Avida said that Engageli is not yet disclosing any metrics on engagement time, customer or user numbers or any other figures. For now, he said the startup is picking up university customers across the U.S., in the UK and Israel (where the founders hail from and all originally cut their tech teeth in the country’s military units), where classes are already handling up to “hundreds” of concurrent students.

He also added that even as more schools return to in-person learning, he is expecting a boost of new users in the fall quarter because the genie, so to speak, is out of the bottle with remote learning and the fact that it can continue to be effective.

“Even before the pandemic there were tens of millions of students online, half of all students were taking some form of online course, and we expect this to go much further, not unlike online grocery or telemedicine,” he said. “One professor described it to me like this: the trough of disillusionment” — a reference to the Gartner Magic Quadrant visualization — “is very shallow here. We ain’t going back.”

This is also a sentiment that educators also seem to be picking up.

“It’s hard to go back once you raise the bar on engagement. With Engageli, I felt the experience was the most like a real classroom. Students are sitting at tables, I can quickly see what they are doing, they can ask others at their table questions, they are chatting and interacting,” said Dr. Theodora Christou, a professor at Queen Mary University of London, in a statement. “I finally have an easy way to lead meaningful group work and case studies online. I would choose Engageli over any other existing tool that my university offers.”

The company’s funding and growth come at a time when we’re indeed seeing a wider wholesale adoption and development of more tools to accommodate digital modes of learning, in many cases also to complement what is happening offline, and also in younger age groups, too.

Just in the last week, Kahoot acquired Clever in the U.S. to bring on a popular platform used by many K-12 schools to manage their online learning interctions, and yesterday StuDocu raised funding for a platform that crowdsources, rates and shares university class notes, a platform that has now passed 15 million students and is growing very fast. All of these spell higher expectations for better technology in the future, something Engageli will also be hoping to engage.

“Dan Avida and his team at Engageli, that includes professors, talented technologists and accomplished ed-tech executives, are uniquely suited to building a digital education solution that actually feels like a classroom and functions even better than some in-person courses,” said Jason Stoffer, Partner at Maveron, in a statement. “Pandemic or not, every school needs Engageli to drive better outcomes for students, whether they’re taking remote classes full time or opt to tune in digitally when they need the flexibility. We’re passionate about leveling the playing field in higher education, and Engageli’s unique platform will help institutions reach and support the needs of every type of student.”

 

News: Google Pay US users can now send money to India and Singapore

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Google Pay users in the U.S. can now send money to GPay users in India and Singapore, Google said on Tuesday, making its first push into the remittance market. The company has partnered with Western Union and Wise, both of which have integrated their services into Google Pay. This is the first time either of

Google Pay users in the U.S. can now send money to GPay users in India and Singapore, Google said on Tuesday, making its first push into the remittance market.

The company has partnered with Western Union and Wise, both of which have integrated their services into Google Pay. This is the first time either of the cross-border payments firms have inked such a deal.

Josh Woodward, Director of Product Management at Google, told TechCrunch in an interview that the company is kickstarting its cross-border payments feature with India and Singapore and intends to expand this worldwide by the end of the year.

“As we do with a number of Google products, we will test, learn, and iterate and then start scaling,” he said.

As part of the partnership, Western Union will power cross-border payments on Google Pay in over 200 countries, while Wise will extend the support in over 80 countries.

When Google Pay users in the U.S. attempt to send money to someone in India or Singapore, they will be informed about the exact amount that the recipient will receive. From within the Google Pay app, users also get to choose which payments provider — Wise or Western Union — they wish to use and how long it would take for the recipient to receive the money.

The remittance feature currently allows only Google Pay’s US users to send money to those in India and Singapore — and not the other way around. Woodward said the company picked India and Singapore in part because of how crucial they are in the remittance world.

India was the largest receiving country for remittances in 2019, receiving more than $80 billion in the year, according to the World Bank. The U.S., meanwhile, is the largest sender. Eventually, Google intends to enable a fully cross-border remittance worldwide.

Also worth noting: The cross-border payments is only available for person-to-person payments. (Businesses on GPay in the U.S. can’t send money to individuals or businesses in India, for instance.)

The partnership with Google will help Wise and Western Union to expand their presence in several markets and more aggressively compete with rivals such as PayPal, which has a wider reach. Wise and Western Union will shoulder the liability and risk.

Nearly 250 million people across the world send over $500 billion in cross-border remittances annually, a report by Citi said last month. But the space is ripe for disruption. “The fees are extremely high. It is embarrassing that we have not solved this issue so far,” Citi analysts wrote. Global average cost for sending money is around 6.5%.

Western Union said in a statement that receivers will pay no charges and will get the exact value in their local currency as chosen by the user in the U.S. Wise said it will charge the actual foreign exchange rate and additional transfer fees, which will wary from country to country. (“The easiest way to find out how much it’ll cost is to find a friend on Google Pay, select Wise as a partner, tap Pay, and enter the amount you’d like to transfer,” it said.)

In either case, Google will not levy any fee to customers. Also, until June 16, Western Union will offer unlimited free transfers when sending money with Google Pay, and Wise will make the first transfer free for new customers on transfers up to $500.

Tuesday’s announcement comes months after Google redesigned the GPay app in the U.S., making it look a lot like GPay app in India and Singapore.

News: Lisbon’s Kitch raises $4M to help restaurants to take control of the delivery app mess

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Lisbon-based food delivery startup Kitch hopes to hands back control to restaurants dogged by the mess of food delivery apps today, by aggregating the apps onto one tablet and platform. Restaurants then get one place to manage all their delivery orders, track couriers, and update their menus across all the delivery apps. It’s now raised

Lisbon-based food delivery startup Kitch hopes to hands back control to restaurants dogged by the mess of food delivery apps today, by aggregating the apps onto one tablet and platform. Restaurants then get one place to manage all their delivery orders, track couriers, and update their menus across all the delivery apps. It’s now raised a €3.25 ($4M) Seed round led by Atlantic Food Labs, with the participation from Market One Capital and the company’s initial investors, Seedcamp and Lisbon-based Mustard Seed MAZE.

Launched in March 2020 Kitch developed its own proprietary technology to support independent restaurants
Rui Bento, co-founder and CEO at Kitch said: “We are committed to making available and to keep developing the tools that enable restaurants to retain their independence and to regain control of their digital businesses.”

Patrick Huber, Partner at Atlantic Food Labs said: “Kitch has shown remarkable traction within a very short time, in a market that continues to grow rapidly.”

With the Kitch app, restaurants create an online store, enabling them to sell their dishes on delivery and takeaway and can own a relationship with their customers. Kitch takes care of payments, deliveries, and customer support and interfaces with apps such as Uber Eats, Glovo, and Deliveroo.

News: Nothing’s first product, the Ear 1 earbud, launches in June

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Say what you will, Nothing has been doing a fine job milking its upcoming launch for all it’s worth. The company has spent the last several month’s teasing the arrival of its first product. The launch will find the company entering the already extremely crowded earbuds category in June, with the arrival of the simply

Say what you will, Nothing has been doing a fine job milking its upcoming launch for all it’s worth. The company has spent the last several month’s teasing the arrival of its first product. The launch will find the company entering the already extremely crowded earbuds category in June, with the arrival of the simply named Ear 1.

Founder Carl Pei teased the forthcoming product in a blog post today, while adding that the company was still a ways off from fully achieving its mission statement of hardware products that simply disappear.

“For those hoping for a disappearing act overnight, Ear 1 falls short,” Pei writes. “The greatest visions are not realized with the flip of a switch, but instead through countless small successes. Ear 1 is just the start. Design is still top secret but what we can tell you is that Ear 1 combines notes of transparency, iconic form, and refined  functionality. It is the starting point that will define the artistry, confidence and craftsmanship that will carry our products and services for years to come.”

Pre-launch hype around the company and product is certainly understandable. Beyond teasing the launch piece by piece, Pei has earned goodwill as the co-founder of OnePlus. The company grew at an impressive rate, courtesy of quality smartphones at an affordable price point, all while maintaining a direct line to its fanbase.

The forthcoming product maintains OnePlus’ simple naming scheme. “Can you guess what the sequel will be called?” the executive asks rhetorically. “Good. Us too.”

OnePlus has also entered the earbuds game, including, most recently, the launch of the fully wireless OnePlus Buds.

News: Exeger takes $38M to ramp up production of its flexible solar cells for self-powered gadgets

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Sweden’s Exeger, which for over a decade has been developing flexible solar cell technology (called Powerfoyle) that it touts as efficient enough to power gadgets solely with light, has taken in another tranche of funding to expand its manufacturing capabilities by opening a second factory in the country. The $38 million raise is comprised of

Sweden’s Exeger, which for over a decade has been developing flexible solar cell technology (called Powerfoyle) that it touts as efficient enough to power gadgets solely with light, has taken in another tranche of funding to expand its manufacturing capabilities by opening a second factory in the country.

The $38 million raise is comprised of $20M in debt financing from Swedbank and Swedish Export Credit Corporation (SEK), with a loan amounting to $12M from Swedbank (partly underwritten by the Swedish Export Credit Agency (EKN) under the guarantee of investment credits for companies with innovations) and SEK issuing a loan amounting to $8M (partly underwritten by the pan-EU European Investment Fund (EIF)); along with $18M through a directed share issue to Ilija Batljan Invest AB.

The share issue of 937,500 shares has a transaction share price of $19.2 — which corresponds to a pre-money valuation of $860M for the solar cell maker.

Back in 2019 SoftBank also put $20M into Exeger, in two investments of $10M — entering a strategic partnership to accelerate the global rollout of its tech and further extending its various investments in solar energy.

The Swedish company has also previously received a loan from the Swedish Energy Agency, in 2014, to develop its solar cell tech. But this latest debt financing round is its first on commercial terms (albeit partly underwritten by EKN and EIF).

Exeger says its solar cell tech is the only one that can be printed in free-form and different colors, meaning it can “seamlessly enhance any product with endless power”, as its PR puts it.

So far two devices have integrated the Powerfoyle tech: A bike helmet with an integrated safety taillight (by POC), and a pair of wireless headphones (by Urbanista). Although neither has yet been commercially launched — but both are slated to go on sale next month.

Exeger says its planned second factory in Stockholm will allow it to increase its manufacturing capacity tenfold by 2023, helping it target a broader array of markets sooner and accelerating its goal of mass adoption of its tech.

Its main target markets for the novel solar cell technology currently include consumer electronics, smart home, smart workplace, and IoT.

More device partnerships are slated as coming this year.

“We don’t label our rounds but take a more pragmatic view on fundraising,” said Giovanni Fili, founder and CEO. “Developing a new technology, a new energy source, as well as laying the foundation for a new industry takes time. Thus, a company like ours requires long-term strategic investors that all buy into the vision as well as the overall strategy. We have spent a lot of time and energy on this, and it has paid off. It has given the company the resources required, both time and money, to bring an invention to a commercial launch, which is where we are today.”

Fili added that it’s chosen to raise debt financing now “because we can”.

“The same answer as when asked why we build a new factory in Stockholm, Sweden, rather than abroad. We have always said that once commercial, we will start leveraging the balance sheet when securing funds for the next factory. Thanks to our long-standing relationship with Swedbank and SEK, as well as the great support of the Swedish government through EKN underwriting part of the loans, we were able to move this forward,” he said.

Discussing the forthcoming two debut gizmos, the POC Omne Eternal helmet and the Urbanista Los Angeles headphones — which will both go sale in June — Fili says interest in the self-powered products has “surpassed all our expectations”.

“Any product which integrates Powerfoyle is able to charge under all forms of light, whether from indoor lamps or natural outdoor light. The stronger the light, the faster it charges. The POC helmet, for example, doesn’t have a USB port to power the safety light because the ambient light will keep it charging, cycling or not,” he tells TechCrunch.

“The Urbanista Los Angeles wireless headphones have already garnered tremendous interest online. Users can spend one hour outdoors with the headphones and gain three hours of battery time. This means most users will never need to worry about charging. As long as you have our product in light, any light, it will constantly charge. That’s one of the key aspects of our technology, we have designed and engineered the solar cell to work wherever people need it to work.”

“This is the year of our commercial breakthrough,” he added in a statement. “The phenomenal response from the product releases with POC and Urbanista are clear indicators this is the perfect time to introduce self-powered products to
the world. We need mass scale production to realize our vision which is to touch the lives of a billion people by 2030, and that’s why the factory is being built now.”

 

News: Flipkart in early talks to raise $1 billion ahead of IPO

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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

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…

News: Is buying and selling short-positions in private companies next? This fintech startup is banking on it

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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

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.

News: Serial fiction app Radish acquired by Kakao Entertainment for $440M

• May 11, 2021
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Serialized fiction app Radish will be 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

Serialized fiction app Radish will be 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.