Daily Archives: August 2, 2021

News: The tale of two edtech IPOs

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Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast where we unpack the numbers behind the headlines. Last week, Natasha and Alex jumped on Twitter Spaces to discuss the tale of two edtech IPOs: Duolingo, the consumer language learning company, and Powerschool, the enterprise K-12 software platform. It was a rare moment in the sun for the

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast where we unpack the numbers behind the headlines. Last week, Natasha and Alex jumped on Twitter Spaces to discuss the tale of two edtech IPOs: Duolingo, the consumer language learning company, and Powerschool, the enterprise K-12 software platform. It was a rare moment in the sun for the recently-revitalized sector, which saw two companies list on the NASDAQ on the same dang day.

Special shout out to our producer Chris Gates for handling this impromptu live chat, tech difficulties and all, and bringing it to your ears on this lovely Monday. Don’t forget that Equity is largely on break this week!

Here’s what we got into, featuring some edtech entrepreneurs nice enough to drop on by:

  • China’s edtech crackdown and how it is impacting startups both internationally and domestically. The regulations, one of which will force for-profit tutoring companies to turn into non-profits, are also getting the cold shoulder from U.S. edtech VCs, it seems.
  •  As Lightspeed Ventures investor Mercedes Bent so aptly put it, the news is somewhat ironic: “[T]he US edtech IPO market is on fire (after being dormant for so long) and the China edtech market is crumbling (after being on fire for so long).”
  • Evidence of that can be found in the Duolingo IPO pricing arc. The company first posted a strong estimate of its worth, raised its range, priced above that raised interval, and still managed to trade higher. The company is still up more than $30 from its IPO price.
  • Powerschool was a bit different. It priced at $18 per share, the low-end of its $18 to $20 range. The company is up from its IPO price, albeit a much more modest two, or three percent in today’s early trading.

In the second half of the show, we brought on the following host of edtech founders to share their hot takes about the current state of edtech:

Before we go, Equity is on a “break” this week, as we do some soul searching and refresh before our next run of shows. Obviously we still had to shaare this episode, and um, are recording another episode this week too, but you, my dear friend, will hear from us again next Monday.

Equity drops every Monday at 7:00 a.m. PDT, Wednesday, and Friday morning at 7:00 a.m. PDT, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.

News: Zoom reaches $85M settlement in ‘Zoombombing’ lawsuit

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Zoom has agreed to pay $85 million to settle a lawsuit that accused the video conferencing giant of violating users’ privacy by sharing their data with third parties without permission and enabling “Zoombombing” incidents. Zoombombing, a term coined by TechCrunch last year as its usage exploded because of the pandemic, describes unapproved attendees entering and

Zoom has agreed to pay $85 million to settle a lawsuit that accused the video conferencing giant of violating users’ privacy by sharing their data with third parties without permission and enabling “Zoombombing” incidents.

Zoombombing, a term coined by TechCrunch last year as its usage exploded because of the pandemic, describes unapproved attendees entering and disrupting Zoom calls by sharing offensive imagery, using backgrounds to spread hateful messages, or spouting slurs and profanities.

The lawsuit, filed in March 2020 in the U.S. District Court in the Northern District of California, also accused the firm of sharing personal user data with third parties, including Facebook, Google and LinkedIn.

In addition to agreeing to an $85 million settlement, which could see customers receive a refund of either 15% of their subscription of $25 if the lawsuit achieves class-action status, Zoom has said it will take additional steps to prevent intruders from gatecrashing meetings. This will include alerting users when meeting hosts or other participants use third-party apps in meetings and offering specialized training to employees on privacy and data handling.

“The privacy and security of our users are top priorities for Zoom, and we take seriously the trust our users place in us,” Zoom said in a statement. “We are proud of the advancements we have made to our platform, and look forward to continuing to innovate with privacy and security at the forefront.”

The settlement requires approval from US District Judge Lucy Koh in San Jose, California, to be finalized.

News: Yaydoo secures $20M, aims to simplify B2B collections, payments

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It’s no secret that the technology for easy business-to-business payments has not yet caught up to its peer-to-peer counterparts, but Yaydoo thinks it has the answer.

It’s no secret that the technology for easy business-to-business payments has not yet caught up to its peer-to-peer counterparts, but Yaydoo thinks it has the answer.

The Mexico City-based B2B software and payments company provides three products, VendorPlace, P-Card and PorCobrar, for managing cash flow, optimizing access to smart liquidity, and connecting small, midsize and large businesses to an ecosystem of digital tools.

Sergio Almaguer, Guillermo Treviño and Roberto Flores founded Yaydoo — the name combines “yay” and “do” to show the happiness of doing something — in 2017. Today, the company announced the close of a $20.4 million Series A round co-led by Base10 Partners and monashees.

Joining them in the round were SoftBank’s Latin America Fund and Leap Global Partners. In total, Yaydoo has raised $21.5 million, Almaguer told TechCrunch.

Prior to starting the company, Almaguer was working at another company in Mexico doing point-of-sale. His large enterprise customers wanted automation for their payments, but he noticed that the same tools were too expensive for small businesses.

The co-founders started Yaydoo to provide procurement, accounts payable and accounts receivables, but in a simpler format so that the collection and payment of B2B transactions was affordable for small businesses.

Image Credits: Yaydoo

The idea is taking off, and vendors are adding their own customers so that they are all part of the network to better link invoices to purchase orders and then connect to accounts payable, Almaguer said. Yaydoo estimates that the automation workflows reduced 80% of time wasted paying vendors, on average.

Yaydoo is joining a sector of fintech that is heating up — the global B2B payments market is valued at $120 trillion annually. Last week, B2B payments platform Nium announced a $200 million in Series D funding on a $1 billion valuation. Others attracting funding recently include Paystand, which raised $50 million in Series C funding to make B2B payments cashless, while Dwolla raised $21 million for its API that allows companies to build and facilitate fast payments.

The new funding will enable the company to attract new hires in Mexico and when the company expands into other Latin American countries. Yaydoo is also looking at future opportunities for its working capital business, like understanding how many invoices customers are setting, the access to actual payments, and how money flows out and in so that it can provide insights on working capital funding gaps. The company will also invest in product development.

The company has grown to over 800 customers, up from 200 in the first quarter of 2020. Its headcount also grew to 100 from 30 during the same time. In the last 12 months, over 70,000 companies have transacted on the Yaydoo network, and total payment volume grew to hundreds of millions of dollars.

Yaydoo is a SaaS subscription model, but the new funding will also enable the company to create a pool of potential customers with a “freemium” offering with the goal of converting those customers into the subscription model as they grow, Almaguer said.

Rexhi Dollaku, partner at Base10 Partners, said the firm saw the way B2B payments were becoming modernized and “was impressed” by the Yaydoo team and how it built a complicated infrastructure, but made it easy to use.

He believes Latin America is 10 years behind in terms of B2B payments but will catch up sooner than later because of the digital transformation going on in the region.

“We are starting to see early signs of the network being built out of the payments product, and that is a good indication,” Dollaku said. “With the funding, Yaydoo will be also able to provide more financial services options for businesses to address a working fund gap.”

News: Newtopia closes first fund of $50M to invest in LatAm startups

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Early-stage venture capital fund Newtopia VC launched Monday with $50 million to invest in tech startups based in Latin America.

Early-stage venture capital fund Newtopia VC launched Monday with $50 million to invest in tech startups based in Latin America.

The fund will invest between $250,000 and $1 million in startups at the seed stage to help them achieve the milestones needed on the path to raising a Series A.

Newtopia is led by five major players in the regional entrepreneurial ecosystem:

  • Patricio Jutard, co-founder of MURAL;
  • Mariano Mayer, former national secretary for entrepreneurs and SMEs in Argentina and founder of Marea Venture Partners;
  • Sacha Spitz, co-founder and partner of Yavu Ventures and former director at the Universidad de San Andrés incubation program;
  • Jorge Aguado, former national science, technology and innovation secretary in Argentina;
  • Juan Pablo Lafosse, founder and former CEO of Almundo.

The group has already invested in startups in Mexico, Brazil and Argentina, including Aleph (B2B SaaS for e-commerce), Apperto (social commerce), Choiz (healthtech), Exactly (DeFi), Elevva (e-commerce brands), Inipay (fintech), Leef (sustainability), Wibson (e-privacy) and Yerbo (wellness).

Mayer told TechCrunch that he sees a great moment happening in Latin America around global venture capital firms — like Sequoia Capital, Andreessen Horowitz and SoftBank —making bets in the region, especially targeting later-stage investments. There are home-grown venture capital firms doing well, too, citing Kazek’s $1 billion funds.

“However, we see a gap in investments in seed and road to Series A,” he added. “We aim to help entrepreneurs in those stages. Newtopia started with conversations during the pandemic, and now we see a big momentum for transformation of traditional sectors and the talent to make businesses out of these opportunities.”

Newtopia is offering both investment and a hands-on mentorship model to guide startups through the initial stages so they can grow regionally or globally. The fund has already amassed a community of more than 70 founders to invest, advise and be venture partners to the portfolio companies.

The Newtopia 10-Week Program works with companies to find product-market fit, achieve initial goals and set a foundation for further growth. The firm opened the call for applicants and will select 10 startups to receive a spot in the program and $100,000 each.

By taking a lead in early-stage investing, it will feed the rest of the venture capital firms that are doing later-stage investing, Mayer said.

He sees investments growing in Latin America every year, estimating there was a record $4 billion spread across the region, turning some companies into unicorns, including Jutard’s Mural, which raised $50 million in July. That has more than validated that there will be more money in coming years, Mayer added.

Jutard said the fund’s founders were all investing or mentoring companies on their own, but the new funding will enable them to structure that assistance to help hundreds of startups rather than a handful.

“Early-stage companies go through an emotional rollercoaster where they feel alone, encounter times when it is hard to sell their product or recruit, so we are focused on building a community of support,” Jutard added.

News: Finite State lands $30M Series B to help uncover security flaws in device firmware

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Columbus, Ohio-based Finite State, a startup that provides supply chain security for connected devices and critical infrastructure, has raised $30M in Series B funding.  The funding lands amid increased focus on the less-secure elements in an organizations’ supply chain, such as Internet of Things devices and embedded systems. The problem, Finite State says, is largely

Columbus, Ohio-based Finite State, a startup that provides supply chain security for connected devices and critical infrastructure, has raised $30M in Series B funding. 

The funding lands amid increased focus on the less-secure elements in an organizations’ supply chain, such as Internet of Things devices and embedded systems. The problem, Finite State says, is largely fueled by device firmware, the foundational software that often includes components sourced from third-party vendors or open-source software. This means if a security flaw is baked into the finished product, it’s often without the device manufacturers’ knowledge. 

“Cyber attackers see firmware as a weak link to gain unauthorized access to critical systems and infrastructure,” Matt Wyckhouse, CEO of Finite State, tells TechCrunch. “The number of known cyberattacks targeting firmware has quintupled in just the last four years.”

The Finite State platform brings visibility to the supply chains that create connected devices and embedded systems. After unpacking and analyzing every file and configuration in a firmware build, the platform generates a complete bill of materials for software components, identifies known and possible zero-day vulnerabilities, shows a contextual risk score, and provides actionable insights that product teams can use to secure their software.

“By looking at every piece of their supply chain and every detail of their firmware — something no other product on the market offers — we enable manufacturers to ship more secure products, so that users can trust their connected devices more,” Wyckhouse says.

The company’s latest funding round was led by Energize Ventures, with participation from Schneider Electric Ventures and Merlin Ventures, and comes a year after Finite State raised a $12.5 million Series A round. It brings the total amount of funds raised by the firm to just shy of $50 million. 

The startup says it plans to use the funds to scale to meet the demands of the market. It plans to increase its headcount too; Finite State currently has 50 employees, a figure that’s expected to grow to more than 80 by the end of 2021.  

“We also want to use this fundraising round to help us get out the message: firmware isn’t safe unless it’s safe by design,” Wyckhouse added. “It’s not enough to analyze the code your engineers built when other parts of your supply chain could expose you to major security issues.”

Finite State was founded in 2017 by Matt Wyckhouse, founder and former CTO of Battelle’s Cyber Business Unit. The company showcased its capabilities in June 2019, when its widely-cited Huawei Supply Chain Assessment revealed numerous backdoors and major security vulnerabilities in the Chinese technology company’s networking devices that could be used in 5G networks. 

Read more:

News: How one founder turned her extensive retail experience into an entirely new kind of shopping

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The Yes founder and CEO Julie Bornstein helped some of the world’s biggest and best-loved brands develop industry leading e-commerce operations, and also served as COO at Stitch Fix, arguable one of the top success stories of digital-first fashion. The Yes is her first foray into entrepreneurship, however, and we got the chance to talk

The Yes founder and CEO Julie Bornstein helped some of the world’s biggest and best-loved brands develop industry leading e-commerce operations, and also served as COO at Stitch Fix, arguable one of the top success stories of digital-first fashion. The Yes is her first foray into entrepreneurship, however, and we got the chance to talk to Julie all about her experience as a founder.

On this week’s episode of Found, our weekly interview podcast, we hear from Julie all about how she identified the gap The Yes was created to address, and how she changed some of the longtime fundamentals about how fashion brands sell their wares and work with customer sales channels. Julie also tells us about why The Yes knew it needed a larger-than-average seed to accomplish its goals, and how she went out and got it.

We loved our time chatting with Julie, and we hope you love yours listening to the episode. And of course, we’d love if you can subscribe to Found in Apple Podcasts, on Spotify, on Google Podcasts or in your podcast app of choice. Please leave us a review and let us know what you think, or send us direct feedback either on Twitter or via email at found@techcrunch.com, or leave us a voicemail at (510) 936-1618. And please join us again next week for our next featured founder.

News: Element Ventures pulls in $130M to double-down on the FinTech enterprise trend

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With the rise of Open Banking, Psd2 Regulation, InsurTech, and the whole, general Fintech boom, tech investors have realized that there is an increasing place for dedicated funds which double down on this ongoing movement. When you look at the rise of banking-as-a-service offerings, payments platforms, insurtech, asset management, and infrastructure providers, you realize that

With the rise of Open Banking, Psd2 Regulation, InsurTech, and the whole, general Fintech boom, tech investors have realized that there is an increasing place for dedicated funds which double down on this ongoing movement. When you look at the rise of banking-as-a-service offerings, payments platforms, insurtech, asset management, and infrastructure providers, you realize that there is a pretty huge revolution going on.

European fintech companies have raised $12.3bn in 2021 according to Dealroom, but the market is still wide-open for a great deal more funding for B2B fintech startups.

So it’s little surprise that B2B fintech-focused Element Ventures, has announced a $130 million fund to double-down on this new FinTech enterprise trend.

Founded by financial services veterans Steve Gibson and Michael McFadgen, and joined by Spencer Lake (HSBC’s former Vice Chairman of Global Banking and Markets) Element is backed by finance-oriented LPs and some 30 founders and executives from the sector.

Element says it will focus on what it calls a “high conviction investment strategy,” which will mean investing in only around 15 companies a year, but, it says, providing a “high level of support” to its portfolio.

So far it has backed B2B fintech firms across the UK and Europe including Hepster (total raised $10M), the embedded insurance platform out of Germany which I recently reported on; Billhop (total raised $6.7M), the B2B payment network out of Sweden; Coincover (total raised $11.6M), a cryptocurrency recovery service out of the UK; and Minna (total raised $25M), the subscription management platform out of Sweden.

Speaking to me over a call McFadgen, Partner at Element Ventures, said: “Steven and I have been investing in B2B FinTech together for quite a long time. In 2018 we had the opportunity to start element and Spencer came on boar in 2019. So Element as an independent venture firm is really a continuation of a strategy we’ve been involved in for a long time.”

Gibson added: “We are quite convinced by the European movement and the breakthrough these Fintech and insure tech firms in Europe are having. Insurance has been a desert for innovation and that is changing. And you can see that we’re sort of trying to build a network around companies that have those breakthrough moments and provide not just capital but all the other things we think are part of the story. Building the company from A to C and D is the area that we try and roll our sleeves up and help these firms.”

Element says it will also be investing in the US and Asia. 

News: BoxGroup closes on $255M across two funds to back startups at their earliest stages

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BoxGroup has quietly, yet diligently, been funding companies at the early stage for over a decade. The 11-year-old firm in fact was the first investor in Plaid, a fintech company that nearly got sold to Visa last year for billions of dollars. It has seen a number of impressive exits over the years, proving an

BoxGroup has quietly, yet diligently, been funding companies at the early stage for over a decade. The 11-year-old firm in fact was the first investor in Plaid, a fintech company that nearly got sold to Visa last year for billions of dollars.

It has seen a number of impressive exits over the years, proving an eye that can detect winners before the winners themselves may even realize it. In fact, it’s that early faith in companies that partner David Tisch believes has been key to BoxGroup’s success.

“If you’re starting a company and you’re going to raise money, that first yes is the hardest. And it’s that’s the one that gives you the confidence, the excitement – to know that there’s somebody out there that’s going to believe in this and give you money for it,” Partner David Tisch told TechCrunch. “We really do try to pride ourselves on being that first yes on a regular basis. So the earlier we meet companies, the better.”

Today, BoxGroup is announcing it has beefed up its war chest so that it can be that “first yes” to more companies with the closure of two new funds totaling $255 million of capital. BoxGroup Five is the firm’s fifth early stage fund, and is aimed at investing in emerging tech companies at the pre-seed and seed stages. BoxGroup Strive is its second opportunity fund that will back companies in their subsequent follow-on rounds. Each fund amounts to $127.5 million. 

Over the years, BoxGroup has made over 300 investments including having invested in the earliest rounds of Ro, Plaid, Airtable, Workrise, Scopely, Bowery Farms, Ramp, Titan, Warby Parker, Classpass, Guideline and Glossier. It has had a number of impressive exits in Flatiron Health, PillPack, Matterport, Oscar, Mirror, Bark, Bread and Trello. 

Besides being the first firm to write Plaid a check, BoxGroup was also the first investor in PillPack, which ended up selling to Amazon for just under $1 billion in 2018.

BoxGroup Five – the firm’s early-stage fund – will invest in about 40 to 50 new companies a year with investments ranging from $250,000 to $1 million.

“We want to be the second or third biggest check in a round,” Tisch said.

Image Credits: BoxGroup; Adam Rothenberg (left), Nimi Katragadda (bottom), Greg Rosen (top), David Tisch (right)

The opportunity fund occasionally makes later-stage investments in new companies, but mostly just continues to support companies it invested in at an earlier stage. For example, BoxGroup first invested in id.me in 2010.

“The company is sort of an 11-year overnight success that we’ve been backing for over a decade now,” Tisch said. “It’s an example of us just continuing to support companies through their life cycle.”

BoxGroup also pre-seeded digital healthcare startup Ro, but also funded every round it’s raised since, including its most recent $500 million funding at a $5 billion valuation. 

Tisch describes the BoxGroup six-person team as “generalists” in terms of the spaces it invests in, with a portfolio consisting of startups in the consumer, enterprise, fintech, healthcare, marketplace, synthetic biology and climate sectors.

Interestingly, BoxGroup’s last fund closures – which totaled $165 million – marked the first time the firm had accepted outside capital in nine years. Prior to that point, it had been funded with only personal capital. Its LPs are a mixed group of endowments, foundations and family offices.

For BoxGroup, building authentic relationships with founders is at the root of what the firm does, says Partner Nimi Katragadda. That includes taking bets on founders, sometimes more than once, even if one of their companies didn’t work out. It means backing just ideas in some cases, and people.

“This cannot be transactional, it has to be personal,” she said. “We want to go on a journey with someone for a decade as they build their business…. We’re comfortable with what early means, including a lot of assumptions, more vision than traction, and raw product.”

Partner Adam Rothenberg agrees, saying: “Our goal is to be the friend in the room. We believe in honesty, tough love, and transparency in building relationships with founders. We focus on the “how” more than the “what” — how a founder thinks, how they will build product, and how they think about attracting talent.”

With offices in San Francisco and New York, the firm will likely be growing in the near future as BoxGroup is looking to add on some “first-line investors,” Tisch said.

Recently, Greg Rosen was named a partner at the firm. Rosen originally joined BoxGroup in 2015, where he spent three years before leaving to join Benchmark. He re-joined BoxGroup in early 2020 and joins the firm’s three other partners: Tisch, Rothenberg and Katragadda. 

While the world of venture is crazy hot right now, Tisch said the firm keeps itself grounded with a wisdom that can only be gained with experience and in time.

“There is seemingly infinite capital waiting to be deployed,” he said. “Without calling the cycle, we know that over time markets go up and down…No matter where we are in a given cycle, smart and determined minds will come together to build important technology companies. Our job is to make sure we are meeting those founders and choosing wisely about which ones to partner with for 10+ year journeys.”

News: Singapore-based Nektar.ai gets $6M to help B2B sales team collaborate more effectively

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Organizing information about prospective deals is a challenging task for B2B sales teams, since salespeople usually rely on multiple tools (email, Zoom, WhatsApp, etc) to talk with buyer committees. It becomes even more unwieldy when sales teams work remotely. Nektar.ai is a B2B sales productivity startup that wants to help sales team by reducing the

A photo of Nektar.ai founders Aravind Ravi Sulekha and Abhijeet Vijayvergiya

Nektar.ai founders Aravind Ravi Sulekha and Abhijeet Vijayvergiya

Organizing information about prospective deals is a challenging task for B2B sales teams, since salespeople usually rely on multiple tools (email, Zoom, WhatsApp, etc) to talk with buyer committees. It becomes even more unwieldy when sales teams work remotely. Nektar.ai is a B2B sales productivity startup that wants to help sales team by reducing the amount of time they spend on manual data entry and providing analytics that can increase their revenue. The Singapore-based company announced today it has raised $6 million in seed funding, led by B Capital Group.

3One4 Capital and returning investor Nexus Venture Partners also participated, along with angel investors like Amit Midha, president of Asia Pacific and Japan at Dell; Ritesh Agarwal the founder and CEO of OYO Hotels;, Kevin Merritt, former president of Tyler Technologies’ data and insights division; Evan Davidson, SentinelOne’s vice president of Asia Pacific and Japan; Deep Nishar, senior managing partner at SoftBank Investment Advisers; and Tom Donlea, Ekata’s vice president and general manager of APAC.

Combined with its previous round, $2.15 million led by Nexus Venture Partners and announced in November 2020, the new funding brings Nektar.ai’s total seed capital to $8.1 million. The company says this is one of the largest seed rounds ever for a SaaS company based in Asia. Nektar.ai’s workforce is remote-first and the company says half of its team are women.

Nektar.ai has been in stealth mode since it was founded in 2020 by Abhijeet Vijayvergiya and Aravind Ravi Sulekha, working with hundreds of clients in private beta mode. Its waitlist is currently open for sign-ups, with plans to launch publicly in the first half of 2022. Part of Nektar.ai’s seed funding will be used to build a go-to-market team focused on the United States.

Nektar.ai was designed for SaaS revenue teams who have to manage information across many channels, including email, calendars, web conferences, Slack, CRM tools, LinkedIn and WhatsApp. This makes it hard for them to collaborate, follow playbooks (or sets of best practices) and get a full understanding of their deals pipeline and revenue. Nektar.ai integrates with different apps, surfaces key data and delivers it to the most convenient collaboration tool for a team, like Slack.

Vijayvergiya told TechCrunch that over the last six months, Nektar.ai accelerated product development because “we saw a strong demand for a guided selling solution in the market,” onboarding more than 200 prospects from its waitlist.

Nektar.ai launched a web console for managers, a Chrome extension and integrations with Salesforce, Google Workspace and Slack. It also added a new feature called Capture Bot, an AI-based system that automatically extracts important information from salespeople’ online interactions with buyer committees, surfacing data that would otherwise be tucked away in different inboxes and calendars. This increases the accuracy of their CRM tools and allows sales managers to see how engaged their teams are with potential customers and how prospective deals are progressing.

For individual representatives, Nektar.ai’s tools let them spend less time on manual data entry. They also get analytics like multithreading scores that help them identify how deals were won or lost. For example, Vijayvergiya said one client found they won deals if they had at least four contacts with a buyer committee after the demo stage. As a result, its sales representatives began engaging with more than four members of the buyer committee on all potential deals.

Another way Nektar.ai helps SaaS sales teams save money and time is building databases of first-party contacts from their inboxes. Vijayvergiya said one client was able to save $50,000 by organizing their existing contacts instead of purchasing third-party contact data.

In a statement, B Capital Group general partner Gabe Greenbaum said, “Nektar.ai’s solutions provide great value to distributed revenue teams, which is even more important as enterprises conduct further business across global markets. B Capital is always eager to work with experienced and knowledgeable founders, and we’re confident that Abhijeet, Aravind and the Nektar.ai team will continue their strong momentum on the path to becoming the industry-leading tool for enterprise sales productivity.”

News: Mixlab raises $20M to provide purrfect pharmacy experience for pet parents

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Pet pharmacy Mixlab has developed a digital platform enabling veterinarians to prescribe medications and have them delivered — sometimes on the same day — to pet parents.

Pet pharmacy Mixlab has developed a digital platform enabling veterinarians to prescribe medications and have them delivered — sometimes on the same day — to pet parents.

The New York-based company raised a $20 million Series A in a round of funding led by Sonoma Brands and including Global Founders Capital, Monogram Capital, Lakehouse Ventures and Brand Foundry. The new investment gives Mixlab total funding of $30 million, said Fred Dijols, co-founder and CEO of Mixlab.

Dijols and Stella Kim, chief experience officer, co-founded Mixlab in 2017 to provide a better pharmacy experience, with the veterinarian at the center.

Dijols’ background is in medical devices as well as healthcare investment banking, where he became interested in the pharmacy industry, following TruePill and PillPack, which he told TechCrunch were “creating a modern pharmacy model.”

As more pharmacy experiences revolved around at-home delivery, he found the veterinary side of pharmacy was not keeping up. He met Kim, a user experience expert, whose family owns a pharmacy, and wanted to bring technology into the industry.

“The pharmacy industry is changing a lot, and technology allows us to personalize the care and experience for the veterinarian, pet parent and the pet,” Kim said. “Customer service is important in healthcare as is dignity and empathy. We kept that in mind when starting Mixlab. Many companies use technology to remove the human element, but we use it to elevate it.”

Mixlab’s technology includes a digital service for veterinarians to streamline their daily medication workflow and gives them back time to spend with patient care. The platform manages the home delivery of medications across branded, generic and over-the-counter medications, as well as reduces a clinic’s on-site pharmacy inventories. Veterinarians can write prescriptions in seconds and track medication progress and therapy compliance.

The company also operates its own compound pharmacy where it specializes in making medications on-demand that are flavored and dosed.

On the pet parent side, they no longer have to wait up to a week for medications nor have to drive over to the clinic to pick them up. Medications come in a personalized care package that includes a note from the pharmacist, clear and easy-to-read instructions and a new toy.

Over the past year, adoptions of pets spiked as more people were at home, also leading to an increase in vet visits. This also caused the global pet care industry to boom, and it is now projected to reach $343 billion by 2030, when it had been valued at $208 billion in 2020.

Pet parents are also spending more on their pets, and a Morgan Stanley report showed that they see pets as part of their family, and as a result, 37% of people said they would take on debt to pay for a pet’s medical expenses, while 29% would put a pet’s needs before their own.

To meet the increased demand in veterinary care, the company will use the new funding to improve its technology and expand into more locations where it can provide same-day delivery. Currently it is shipping to 47 states and Dijols expects to be completely national by the end of the year. He also expects to hire more people on both the sales team and in executive leadership positions.

The company is already operating in New York and Los Angeles and growing 3x year over year, though Dijols admits operating during the pandemic was a bit challenging due to “a massive surge of orders” that came in as veterinarians had to shut down their offices.

As part of the investment, Keith Levy, operating partner at Sonoma Brands and former president of pet food manufacturer Royal Canin USA, will join Mixlab’s board of directors. Sonoma Brands is focused on growth sectors of the consumer economy, and pets was one of the areas that investors were interested in.

Over time, Sonoma found that within the veterinary community, there was space for a lot of players. However, veterinarians want to home in on one company they trust, and Mixlab fit that description for many because they were getting medication out faster, Levy said.

“What Mixlab is doing isn’t completely unique, but they are doing it better,” he added. “When we looked at their customer service metrics, we saw they had a good reputation and were relentlessly focused on providing a better experience.”

  


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