Ecwid raises $42M from Morgan Stanley and PeakSpan

In the same week that Facebook announced a redoubled effort to make a bigger mark in e-commerce, one of its long-time partners has closed a large round of funding. Ecwid, the startup that sells e-commerce tools directly and via third parties like Square and Wix, letting businesses build e-commerce experiences on their own websites and apps, as well as via Facebook, Instagram, Amazon, Google, and more, has raised $42 million from Morgan Stanley and PeakSpan Capital.

Notably, now San Diego-based Ecwid had only raised about $6.5 million since 2009, the year it was founded in Russia as a spinout of X-Cart, a previous company founded by the founder and CEO Ruslan Fazylev; and it’s already profitable. So rather than being used to operate, Fazylev said the funding enabled earlier outside investors — Russia’s Runa Capital, iTech from Latvia and the IT-park business incubator from Kazan — cash out, and gives Ecwid funds that it can use both for acquisitions and to continue expanding its platform organically.

Ecwid is in the stable of e-commerce companies that include the likes of Shopify, BigCommerce and WooCommerce, which have seized on the growth of online shopping over the last decade and helped companies that are not digital by nature — specifically small and medium brick-and-mortar businesses — become a part of that digital economy. And to underscore that low barrier to entry, its pricing starts at free to enable shopping on a website covering 10 or fewer products. (Further priced tiers include the ability to integrate with Facebook and other sites, as well as sell more items, apply more analytics and so on.)

That mandate and opportunity to provide analogue SMBs a route to the next generation of shopping has taken on a new dimension in the last few months. Authorities in many jurisdictions have closed down brick-and-mortar establishments and offices, and restricted day-to-day movement and contact between people in an attempt to slow down the spread of the COVID-19 pandemic.

In other words, if e-commerce has been a long-term growth opportunity with upside for those that cared to invest in it, overnight it became a must-have for any small business that wanted to continue to operate through and after this health crisis.

Just as we’ve seen that trend play out for Shopify (whose share price has been on a roll), Fazylev said that Ecwid, too, has had a big boost. Ironically all that activity started after it closed the round (which was raised before COVID-19 really hit).

“The moment we signed the term sheet, things started to go really crazy,” he said. “Overnight, demand tripled because SMBs were under immense pressure to transition to online ordering. We at Ecwid are not worried about the Walmarts of the world but about the small guys and making it super easy for them. And so demand went through the roof.” Transaction volume between March and April grew by 50% and to meet demand.

Even before that, Ecwid was an under-the-radar success, which is why PeakSpan and Morgan Stanley came knocking.  Even if it’s not the 300% growth of the last couple of months, 2019 saw sign-ups double on the platform with a Net Promoter Score of above 60. (Fazylev said Ecwid lives and dies by its Net Promoter Score so he’s especially proud of this above-average figure.)

And in addition to its direct-to-SMB offering, it white labels through a number of popular channels like Wix, GoDaddy and Square. Together, there are some 1.5 million SMBs across 175 countries (and 54 languages) using its e-commerce rails. This might actually have been one reason why it wasn’t a part of the Facebook Shops news: it’s quietly enabling an army of competitors. But to be very clear, when I asked about the omission, Fazylev said he was stumped by it himself.

PeakSpan Capital Co-Founder and Managing Partner Phil Dur, and Pete Chung, Managing Director and Head of Morgan Stanley Expansion Capital, are both joining the board as part of this round.

“Covid-19 is reinforcing what we already knew: e-commerce is vital, and it’s available to even the smallest of merchants now with Ecwid’s free tools that even novice Internet users can adopt quickly,” said Dur, in a statement. “We have been watching Ecwid for many years.The company’s impressive capital efficiency and very strong long-term market opportunity made it an easy decision for us to partner with them during this next phase of growth.”

“Ecwid is truly helping its customers make the most of e-commerce enablement at a time when their traditional retail businesses have been disrupted so dramatically,” said Chung, in a statement. “Ruslan is an e-commerce visionary who has built a team and beloved solution that allows any mom-and-pop shop to embrace the online world,  dramatically expanding their revenue and market potential.”

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Beware mega-unicorn paper valuations

Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.

There’s a famous old post going around Twitter this week by entrepreneur and developer David Heinemeier Hansson (@DHH). DHH is a critic of certain elements of the startup world, especially wild valuations. This entry from him is, in my view, a classic of the genre.

The post in question is titled “Facebook is not worth $33,000,000,000,” and was written back in 2010.

You can already imagine who might find the post irksome — namely folks who are in the business of putting capital into high-growth companies. This sort of snark, though not precisely recent, is a good example of how posts like the Facebook entry are read on Twitter.

If you take a moment to actually read DHH’s blog, however, you’ll find that the first part of his argument is that selling a minute slice of a company at a high price, thus “revaluing” the company at a new, stratospheric valuation, is a little silly. DHH didn’t like that by selling a few percentage points of itself, Facebook’s worth was pegged at $33 billion. We’ve seen some similarly-small-dollar, high-valuation rounds recently that could be scooted into the same bucket.

It’s a somewhat fair point.

But what struck me this morning while re-reading the DHH piece was that his second two points are useful rubrics for framing the modern, post-unicorn era. DHH wrote that profits matter, companies are ultimately valued on them, and that companies that don’t scale financial results as they add customers (or users) aren’t great.

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Boulder Care opioid treatment platform picks up traction during coronavirus

With the regulations around telehealth changing rapidly amidst the COVID-19 pandemic, an opioid treatment platform with a digital component is finally finding a strong market foothold after facing a mountain of regulatory hurdles.

Boulder Care was founded by Stephanie Papes, a former associate at Apple Tree Partners. She first became interested in opioid treatment after facilitating the firm’s financing round with an organization called CleanSlate Addiction Centers, which focused on in-person treatment for opioid and alcohol addiction.

There are several options when it comes to opioid addiction treatment. A common one is replacement therapy via methadone, an opioid, which relieves the symptoms of withdrawal while blocking the high that comes from use of heroine and other narcotic pain relievers. There’s also in-patient treatment, which usually comes with strict rules around the use of drugs and sometimes even legal addictive substances like nicotine, with a very low tolerance policy for relapses.

In-patient treatment is usually expensive and not often covered by insurance, and asks patients to go cold turkey. Methadone, on the other hand, requires patients to come to a clinic at least once every day. Not only does that make it difficult to live a normal life, but these clinics are often targeted by drug dealers to poach clients.

Boulder Care looks at a different approach that uses a combination of telehealth services and a prescription drug called Buprenorphine (brand name: Suboxone).

Alongside a greater risk of contracting COVID-19, and having a more severe experience of the disease than those without addiction, addicts are also at a greater risk of overdose or continued use of opioids due to social distancing and increased anxiety and stress, two huge contributing factors to addiction, according to an article published by Harvard.

Boulder Care uses telehealth to offer patients a comprehensive recovery plan, including clinician support (for medical and medication needs), a peer coach (who has lived experience with addiction and can help talk through challenges and issues) and a care advocate (who helps with administrative needs around care and insurance coverage).

“It’s not 100% abstinence only right away,” said Papes. “It’s a journey, and every incremental step and savings for the health system is good for the individual. The work that we do, just by building that trust with our participants, telling them ‘we value you, whether or not you’re using substances, and we’re not going to kick you out of the program for having an unexpected test result on your on your drug test or telling us that you use methamphetamine.’ There are a lot of policies in some of these programs that just continue to put people in harm’s way. So residential facilities will say you can’t be here for your heroin addiction if you’re smoking cigarettes, and they’ll truly discharge you from the program if you smoke. It’s not beneficial for anyone. So, we have this clinical philosophy, it’s really important, and it’s all about unconditional support.”

One of the big challenges for Boulder Care and opioid treatment organizations across the country is the regulatory limits on prescribing Buprenorphine. Buprenorphine is an opioid partial agonist, which means it produces euphoric effects and respiratory depression at low to moderate doses. However, these effects are much weaker than a full opioid agonist like heroine or methadone.

Buprenorphine also greatly weakens the effects of withdrawal, allowing patients to try and stabilize their life and achieve a healthier lifestyle.

Unlike methodone, Buprenorphine can be prescribed by a doctor for use at home, rather than making a trip to a clinic, where patients must be examined and drug tested before they can take their dose. However, there are regulatory limits on doctors around the number of people they can prescribe Buprenorphine to in a given time period, and doctors must also pay to get training and a license to prescribe the drug.

According to Papes, this means 80 percent of the country who could benefit from a Buprenorphine prescription can’t get it. In fact, a HuffPost analysis showed that even if all the doctors who are licensed to prescribe Buprenorphine did so at the maximum rate in 2012, more than half of Americans suffering from opioid addiction still couldn’t get access to the drug.

Part of the reason that prescribing Buprenorphine has such strict limitations comes down to stigma, with many believing in the long-held misconception that replacing one drug for another isn’t the answer, and that abstinence is simply a challenge of mental willpower, negating the fact that addiction is a disease.

There’s no doubt about the potential efficacy of Buprenorphine. In 1995, France allowed any doctor to prescribe Buprenorphine without special licensing or training. About 10x the number of addicted patients began receiving medication-assisted treatments, cutting overdoses by nearly 80 percent in four years, according to the Atlantic.

Another requirement around the prescription of Buprenorphine is that the patient had to have at least one in-person visit with the doctor before they could get access to the medication.

That visit could be someone coming into a clinic or facility seeking to change their own life proactively. It could also be at the emergency room when someone is brought in for an overdose.

“It’s very challenging when someone has a tiny window in which they’re feeling like they’re ready for change, and you have to coordinate with another facility in order to get them into your care,” explained Papes.

During this national health emergency, that requirement has been waived, allowing for doctors to prescribe this medication without an in-person meeting with the patient. This is a huge boost for Boulder Care, which runs its business entirely via telehealth.

Since the start of March 2020, the company has seen 130% week-over-week increase in weekly inquiries from potential patients, and new patient enrollments is up 32%. During COVID-19, any patient who is uninsured or under-insured can get services from Boulder for free.

Boulder recently partnered with Premera Blue Cross, an insurance plan in the Pacific Northwest, to provide zero cost share options for virtual substance use disorder treatment, which will give 2.3 million customers access to Boulder Care through at least June 30. Cost shares will be waived for all patients seeking medically necessary telehealth treatment.

Alongside revamping the way patients receive treatment for substance use disorders, Boulder is also looking to change the payment model. Traditionally, the healthcare system remunerates providers based on admissions (and often, readmissions) without focusing on outcomes. Meanwhile, outpatient fee-for-service reimburses for clinical visits and drug-testing, rather than peer recovery coaching, 24/7 text messaging and same-day access, a few of the things that contribute to successful outcomes outside of clinical treatment.

Boulder partners with paying entities for ‘bundled’ services, charging a flat rate per patient without focusing on the volume of procedures. The hope, according to Papes, is to “realign incentives and tie payment to accountability for meaningful outcomes.”

Boulder Care has raised more than $10 million with investment from Tusk Venture Partners, who led the Series A, among others.

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Facebook introduces new Messenger safeguard aimed at combating scams and fake friends

Facebook this morning announced a new feature for Messenger designed to cut down on malicious parties looking to scam users. The company scans accounts for suspicious activity, leveraging machine learning to pick up anomalies like accounts sending a large number of requests in a short time span or numerous message requests to users under 18. The feature arrives amid a notable uptick in false friend requests caused by a change to the service’s search algorithm. 

If suspicious activity is detected, the app will pop up a chat window noting the issue, along with options for blocking or ignoring the user. The system has already seen a limited roll out for some Android users, dating as far back as March; iOS functionality, meanwhile, is set to arrive some time next week.

The feature aims to both cut down on scammers and users posing as other people, along with helping to protect minors from bad actors. The system is designed to limit interactions between adults and younger users who aren’t already connected on the platform. Per Facebook, “Our new feature educates people under the age of 18 to be cautious when interacting with an adult they may not know and empowers them to take action before responding to a message.”

Facebook says the feature will continue to work with the addition of end-to-end encryption on the platform, which is likely where that machine learning comes in, keeping human operators from having to view potentially sensitive information. 

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6 CISOs share their game plans for a post-pandemic world

Oren Yunger Contributor

Oren Yunger is an investor at GGV Capital, focused on enterprise IT infrastructure, development tools and cybersecurity. He was previously chief information security officer at a SaaS company and a public financial institution.

Like all business leaders, chief information security officers (CISOs) have shifted their roles quickly and dramatically during the COVID-19 pandemic, but many have had to fight fires they never expected.

Most importantly, they’ve had to ensure corporate networks remain secure even with 100% of employees suddenly working from home. Controllers are moving millions between corporate accounts from their living rooms, HR managers are sharing employees’ personal information from their kitchen tables and tens of millions of workers are accessing company data using personal laptops and phones.

This unprecedented situation reveals once and for all that security is not only about preventing breaches, but also about ensuring fundamental business continuity.

While it might take time, everyone agrees the pandemic will end. But how will the cybersecurity sector look in a post-COVID-19 world? What type of software will CISOs want to buy in the near future, and two years down the road?

To find out, I asked six of the world’s leading CISOs to share their experiences during the pandemic and their plans for the future, providing insights on how cybersecurity companies should develop and market their solutions to emerge stronger:

• Ian Amit, Cimpress
• Colin Anderson, Levi Strauss & Co.
• Al Ghous, ServiceMax
• Adrian Ludwig, Atlassian
• Rinki Sethi, Rubrik
• Elwin Wong, Ross Stores

The security sector will experience challenges, but also opportunities

The good news is, many CISOs believe that cybersecurity will weather the economic storm better than other enterprise software sectors. That’s because security has become even more top of mind during the pandemic; with the vast majority of corporate employees now working remotely, a secure network has never been more paramount, said Rinki Sethi, CISO at Rubrik. “Many security teams are now focused on ensuring they have controls in place for a completely remote workforce, so endpoint and network security, as well as identity and access management, are more important than ever,” said Sethi. “Additionally, business continuity and disaster recovery planning are critical right now — the ability to respond to a security incident and have a robust plan to recover from it is top priority for most security teams, and will continue to be for a long time.”

That’s not to say all security companies will necessarily thrive during this current economic crisis. Adrian Ludwig, CISO at Atlassian, notes that an overall decline in IT budgets will impact security spending. But the silver lining is that some companies will be acquired. “I expect we will see consolidation in the cybersecurity markets, and that most new investments by IT departments will be in basic infrastructure to facilitate work-from-home,” said Ludwig. “Less well-capitalized cybersecurity companies may want to begin thinking about potential exit opportunities sooner rather than later.”

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RapidAPI raises $25M more to expand its API marketplace

Less than a year after raising $25M led by Microsoft for its take on building API marketplaces, RapidAPI has rapidly followed that up with another infusion of capital as it reaches 20,000 APIs tracked, integrated, and used across its marketplace by millions of developers. Today the startup is announcing that it raised another $25 million from existing investors Andreessen Horowitz, DNS Capital, Green Bay Ventures, M12 (Microsoft’s Venture Fund), and Grove.

This is a second closing of RapidAPI’s Series B, which we first wrote about last year, bringing the total for the round to $50 million and $62.5 million overall. PitchBook notes that the startup’s previous valuation was $80 million, which would put this now at upwards of $105 million but likely higher, considering that the company has scaled by quite a bit. Co-founder and CEO Iddo Gino would not disclose the actual amount in an interview this week.

APIs are the building blocks of today’s digital world: developers use them to quickly integrate features, data, services and functions into their own apps, removing the need to build and scale all those elements themselves from scratch. But while the big selling point of using APIs is that they allow developers to integrate using only a few lines of code, that doesn’t tell the whole story. The issue is that a lot of API interfaces are not uniform and so sourcing and using a variety of them can become very time-consuming and on aggregate a lot more difficult than the basic concept of API would have you assume.

“You can’t build everything from scratch, and using APIs makes work a lot more efficient,” co-founder Iddo Gino once said to me. “But each API has a different format and authentication strategy. You have to speak a lot of different languages to use them all.”

RapidAPI’s approach is to create a framework that not only helps you find the API you are looking for, but lets you integrate them more easily by way of a single API key and SDK. It covers both free and paid APIs, and public as well as “private” APIs. When your company is a subscriber — by way of the RapidAPI for Teams product — it can also help keep track of your own organization’s API work.

The formula has been a success. There are now 18,000 teams using the Teams product among more than one million developers using the platform overall.

Within that number, RapidAPI — originally founded in Israel in 2015 and now based also in San Francisco — says that since January, it has added 300,000 new developers, up six-fold monthly compared the the same five months of 2019. The marketplace itself now has 20,000 APIs, doubling in the last year, with 1,000 getting added each month. Contributors to its marketplace include Microsoft, Twilio, SendGrid, Nexmo, Skyscanner and (our former stablemate) Crunchbase.

RapidAPI doesn’t charge people to use APIs that are already free to use. Rather it makes its money from subscriptions to its API management service as well as through serving paid APIs. It says that paid subscriptions have also grown by 30,000, with those using the enterprise tier — where you can develop your own white-label, in-house version of a marketplace for your own staff and customers — are on the rise with financial services, insurance companies, carriers and healthcare companies among those building marketplaces on RapidAPI’s rails.

While a lot of businesses, including even tech startups, have had to make big adjustments to work in our new environment and its focus on social distancing to help manage the spread of COVID-19, the same didn’t go for RapidAPI, noted Gino. The company already had remote teams — a consequence of being founded in one country and now essentially having two gravitational poles — and RapidAPI’s team of 75, and its customers, have in their culture working across different environments including virtualised ones.

What the current climate has pointed to, however, is that RapidAPI is the kind of company that stands to benefit from how other organizations are coping with digital transformation, by helping provide developers with libraries that they can use, wherever they happen to be.

Another interesting thing that has come up in the current climate is the impact it’s had on what APIs are getting the most calls. In addition to the regular roster of most popular APIs that include communications, payments and other financial services, Gino told me that APIs related to COVID-19 data have emerged as some of the most heavily trafficked, in line with how so many are working to make sense of what is going on, and how they might help the rest of us.

These include API calls for datasets and geolocation, as well as other statistics, some of which are free and some of which are paid. RapidAPI says that between March 1 and mid-May, the top five COVID APIs had more than 224 million calls with a peak of almost 4.5 million in a single day.

 

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Spruce is eliminating the drudgery of real estate, and has $29M more from Scale to make sales easy

Real estate is one of those classic industries we always talk about in Silicon Valley: multi-trillion dollars in scale in terms of assets and transaction volume, but still relying on good ole’ pen and paper to get anything actually done. A huge number of companies have launched to digitize all aspects of real estate, from calculating valuations to monitoring operational costs and underwriting mortgages.

Where top VCs are investing in real estate and proptech (Part 1 of 2)

 

One of those companies is New York City-based Spruce, which was founded back in 2016 to digitize the prodigious paperwork that must be completed during a real estate transaction, including handling title, ensuring all closing docs are completed, and monitoring compliance in every geographical jurisdiction they operate in. The company raised a cumulative $19.1 million in Series A funding across two tranches (my colleague Jon Shieber covered the first tranche back in 2017), and now it is poised for even more growth.

The company is announcing today that it has added $29 million in growth capital led by Alex Niehenke at Scale Venture Partners, with Zigg Capital and Bessemer participating. Niehenke has previously funded companies like Root Insurance, which is focused on offering more competitive car insurance based on realistic data from drivers.

That seems to be roughly the same thesis here with Spruce — better data and digitalization can massively improve the quality and efficiency of legacy industries.

“Instead of using local offices with manual communication and manual processes, we provide [our clients] with API’s that allow them to scale effectively and to provide great digital experiences to their customers,” said Patrick Burns, the cofounder and CEO of the company. Burns had previously done product at wealth management startup Betterment, where he also met his cofounder Andrew Weisgall.

It can be bewildering how all the startups in real estate tech fit together, but this one is simple. Spruce wants to be the workflow tool for real estate transactions, which means that they don’t underwrite mortgages or handle valuations themselves directly. Rather, the platforms wants to be the central nervous system between buyers, sellers, lenders, and all the coterie of other services required to get a transaction closed. The company handles all kinds of transactions from new home purchases by families to investor-to-investor sales.

What’s interesting is that they have two streams of revenue according to Burns. First, they take a closing fee, which is customary in real estate transactions. Spruce argues that its efficiency cuts the price of closing a transaction, ultimately saving its clients money. Second, the company earns a premium as the agent of record for the title insurance policy agreed to in the transaction, which provides a continual stream of revenue from its clients. Similar to closing fees, title insurance broker fees are customary in the industry.

It’s a pretty clear value proposition, and that’s helped it grow transaction volume dramatically. According to the company, it has processed $1.25 billion of transactions on its platform, and its revenue has grown 400% annually. With roughly five million existing homes sold in the U.S. each month, that’s still an exiguous chunk of the market.

The global pandemic underway right now has taken a massive bite out of real estate transactions, particularly for homes, since buyers mostly can’t attend showings due to social distancing policies. The upshot is that those same social distancing policies have also scrambled the traditional real estate closing, which required passels of attorneys and others to work together to get all documents signed. Spruce — and other digitalization startups in the space — are poised to transition more of that legacy paperwork onto their platforms as industry players look for online approaches.

Burns says the capital will be used to expand Spruce’s product and client partnerships. The company currently has three operations “hubs” in New York, Texas, and California.

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Chief, the leadership network for women, raises $15 million in funding

Chief, the social network dedicated exclusively to women in professional leadership positions, announced today that it has $15 million in funding from its existing investors, including General Catalyst, Inspired Capital, GGV Capital, Primary Venture Partners, Flybridge Capital and BoxGroup.

The startup is a highly-vetted network of women who are leaders in their business, either managing a budget, a large team or both. The women are often at the VP or executive level. The company has more than 2,000 members in New York, Los Angeles and Chicago from companies like Google, IBM, HBO, Chobani, Walmart, Visa, Teladoc, Doctors Without Borders and the New York Times.

Chief was founded by Carolyn Childers and Lindsay Kaplan, who saw an opportunity to bring community, mentorship and guidance to a very underserved client: the female business leader.

Childers was SVP of Operations at Handy and led the launch of Soap.com, serving as GM there through its acquisition by Amazon. Kaplan was on the founding team of Casper, serving as VP of Communications and Brand, before leaving to co-found Chief.

Chief members are placed into a Core Group, which is industry agnostic, to receive training from one of the company’s contracted and vetted executive coaches alongside their peers. In these peer groups, members talk about their challenges and receive support and guidance from one another, as well as an executive coach. Members also have access to a community chat feature, and Chief’s events, which include leadership workshops, conversations with industry leaders and community roundtables.

Obviously, the coronavirus pandemic has put a damper on in-person features of the platform, such as Core Groups and live events. But Chief has moved swiftly to put all these core services on the web for members to attend and participate virtually.

The company has also fast-tracked the launch of its hiring board, which gives members the ability to privately list great candidates and open positions to the broader network.

Chief vets its members to ensure that the women on the platform ‘get it,’ as Kaplan likes to say.

“We all know it gets lonely at the top, and it gets a lot lonelier a lot earlier for women,” said Childers. “Women are on panels or on the circuit and they’re exhausted. This is a community they don’t have to be the one in the spotlight and feel all the pressure, but can actually be supported in a network of women who feel the exact same way. These women are the only person or one of the few people in their organization who have hit that level of leadership, and really need support from people who get it.”

The company looks at the applicants experience, the size of their organization and immediate team, the reporting structure, budget size, awards and credentials, thought leadership and impact as well as current member nominations.

Interestingly, no more than 9 percent of the Chief membership work in a single industry, which leads to cognitive diversity within the community. The average age of a Chief member is 43, and members manage over $10 billion in collective budget at their organizations and more than 100,000 employees.

Executive-level members pay $7,900 annually, while VP-level members pay $5,800 each year. Chief says that 40 percent of its members are Executives, with the other 60 percent are VPs. The company says that 30 percent of its membership base are women of color.

Chief also operates a Membership Grant program, created to promote diversity of background and thought among members, that brings the cost of an annual membership down to $3,800 for folks coming from non-corporate or underfunded organizations. The company did not disclose what percentage of customers are on the grant program.

Some napkin math then tells us that Chief is likely generating more than $10 million in revenue in 2020, on the conservative end. Kaplan and Childers say that they have a waitlist of 8,000 to join.

The new funding will be used to accelerate growth to meet demand in new cities and support the build-out of technology infrastructure. This latest round brings Chief’s total funding to $40 million.

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Chief, the leadership network for women, raises $15 million in funding

Chief, the social network dedicated exclusively to women in professional leadership positions, announced today that it has $15 million in funding from its existing investors, including General Catalyst, Inspired Capital, GGV Capital, Primary Venture Partners, Flybridge Capital and BoxGroup.

The startup is a highly-vetted network of women who are leaders in their business, either managing a budget, a large team or both. The women are often at the VP or executive level. The company has more than 2,000 members in New York, Los Angeles and Chicago from companies like Google, IBM, HBO, Chobani, Walmart, Visa, Teladoc, Doctors Without Borders and the New York Times.

Chief was founded by Carolyn Childers and Lindsay Kaplan, who saw an opportunity to bring community, mentorship and guidance to a very underserved client: the female business leader.

Childers was SVP of Operations at Handy and led the launch of Soap.com, serving as GM there through its acquisition by Amazon. Kaplan was on the founding team of Casper, serving as VP of Communications and Brand, before leaving to co-found Chief.

Chief members are placed into a Core Group, which is industry agnostic, to receive training from one of the company’s contracted and vetted executive coaches alongside their peers. In these peer groups, members talk about their challenges and receive support and guidance from one another, as well as an executive coach. Members also have access to a community chat feature, and Chief’s events, which include leadership workshops, conversations with industry leaders and community roundtables.

Obviously, the coronavirus pandemic has put a damper on in-person features of the platform, such as Core Groups and live events. But Chief has moved swiftly to put all these core services on the web for members to attend and participate virtually.

The company has also fast-tracked the launch of its hiring board, which gives members the ability to privately list great candidates and open positions to the broader network.

Chief vets its members to ensure that the women on the platform ‘get it,’ as Kaplan likes to say.

“We all know it gets lonely at the top, and it gets a lot lonelier a lot earlier for women,” said Childers. “Women are on panels or on the circuit and they’re exhausted. This is a community they don’t have to be the one in the spotlight and feel all the pressure, but can actually be supported in a network of women who feel the exact same way. These women are the only person or one of the few people in their organization who have hit that level of leadership, and really need support from people who get it.”

The company looks at the applicants experience, the size of their organization and immediate team, the reporting structure, budget size, awards and credentials, thought leadership and impact as well as current member nominations.

Interestingly, no more than 9 percent of the Chief membership work in a single industry, which leads to cognitive diversity within the community. The average age of a Chief member is 43, and members manage over $10 billion in collective budget at their organizations and more than 100,000 employees.

Executive-level members pay $7,900 annually, while VP-level members pay $5,800 each year. Chief says that 40 percent of its members are Executives, with the other 60 percent are VPs. The company says that 30 percent of its membership base are women of color.

Chief also operates a Membership Grant program, created to promote diversity of background and thought among members, that brings the cost of an annual membership down to $3,800 for folks coming from non-corporate or underfunded organizations. The company did not disclose what percentage of customers are on the grant program.

Some napkin math then tells us that Chief is likely generating more than $10 million in revenue in 2020, on the conservative end. Kaplan and Childers say that they have a waitlist of 8,000 to join.

The new funding will be used to accelerate growth to meet demand in new cities and support the build-out of technology infrastructure. This latest round brings Chief’s total funding to $40 million.

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On-demand storage startup MakeSpace picks up another $55M

Sheltering-in-place and working from home curing COVID-19 has driven many of us to reorganize and de-clutter our living environments, and today one of the startups that is capitalizing on that trend is announcing a large round of funding to continue its growth. MakeSpace, an on-demand storage company that makes it easy to order, store and retrieve your physical belongings (also providing the muscle — that is, people — to help you do it), has closed a $55 million round — $45 million in equity funding and $10 million in debt — led by Iron Mountain, an existing investor and strategic partner whose primary focus is storage for larger businesses.

The funding is notable in part because of its size, but also because of the fact that it has happened at all.

On-demand storage startups have sprung up all over the world, hopeful that their new take on an antiquated, fragmented and valuable ($38 billion annually spent on storage) market would lead to big returns in a brave, new, Uberified world. But in reality, we’ve seen a lot of ups and downs, with various startups merging, closing, transferring and trying to pivot in the process. That’s left a consolidated space with fewer, hopefully better capitalised and better organised, competitors remaining. (Another biggie in this area is Clutter, backed by SoftBank and others, which has also been on a consolidation play as part of its growth.)

MakeSpace looks like it’s making a successful play to be in that group. This is a Series E for the startup — with other investors in the round including 8VC, Upfront Ventures, Maywic Select Investments, Ten Eighty, Provenio Capital, and CX Collective — and co-founder and CEO Rahul Gandhi said was at “a premium” to the valuation MakeSpace had in the last round of funding (a Series D that closed last year), without confirming either the previous or current numbers.

For some more context, PitchBook details what seems to have been a rollercoaster of valuations for the startup, which if accurate underscore some of those obvious challenges in this market. Update: Gandhi confirmed that the startup has now raised about $150 million and the valuation is higher than that.

MakeSpace itself has hit a number of milestones that point to its own growth. Last year, it added 20 new markets, bringing the total to 31 in North America, and doing so in a cost-effictive way. While one of the biggest costs (and stumbling blocks) for storage services to date has been grappling with building real estate businesses, MakeSpace has leaned on the infrastructure of its strategic investor Iron Mountain to bypass that challenge (and reduce those associated costs).

Gandhi said that it’s been outpacing “even our strongest forecasts,” with growth north of 30% on its targets, and he said the company has tens of thousands of customers using its service, which is priced in tiers starting at $69/month.

And while you might assume that a lack of house moving might mean less activity for storage companies, it seems the opposite is the case: MakeSpace and others like it have been designated “essential services” and its services have been in demand for people who are looking at their living spaces — and the prospect of spending significantly more time in them doing more than just watching Netflix, eating and sleeping — with new eyes. And ditto small businesses that are moving out of premises, even temporarily, or needing to rejig their environments because of distancing rules.

What’s also notable about MakeSpace is how it organises its workforce. While many on-demand businesses today have scaled by using an army of contractors, and all the complexities that this brings into the equation with regards to employee protections and benefits, MakeSpace has hired only full-time people, using its own team and those employed by Iron Mountain.

“They can get wonderful packages and all the benefits and perks to keep employee base happy,” Gandhi said. “It makes it easier to scale up the business and in terms of the hiring capabilities to help us scale.”

For a company built out of tech DNA — which is the other side of the business, involving smart logistics planning and storage optimising, and of course building it into an interface that can be used easily by workers and customers — workforce scaling and real estate/warehouse expansion are two of the biggest challenges in building on-demand storage businesses to compete with the heavyweights in the market, which include Public Storage, Extra Space Storage and U-Haul.

For Iron Mountain, it gives the firm, which focuses on enterprise users, a way to share in the revenues from tapping into the consumer market (optimizing use of its storage warehouses) without the costs of trying to service it directly.

“It has been amazing to see what MakeSpace has accomplished in the past year alone, growing from 4 to 24 markets almost overnight, and adding another 7 in 2020. They have taken a unique approach to storage that answers the modern customer’s demand for convenience, using technology to enhance the service and grow at an immense scale,” said Deirdre Evens, EVP and GM of North America Records and Information Management at Iron Mountain, in a statement.

“Especially now, services such as MakeSpace are delivering vital solutions for customers and businesses. MakeSpace has proven itself as an industry leader, finding new ways to offer support and services for this challenging time.  We continue to be both proud and excited about our partnership with MakeSpace and the opportunity to leverage Iron Mountain’s storage and logistics expertise to further penetrate the fast growing valet consumer storage market.”

Gandhi acknowledged also that while Iron Mountain is an obvious acquirer longer-term, it remains a minority investor.

“It’s really key that we remain independent,” he added. “We understand the strength of what they bring to table but in order for this business to capture major market share we felt collectively it was important for it to remain that way. At some point that discussion [on a bigger stake or acquisition] may happen but for now we feel incredibly good about what they are bringing to the table.”

https://ift.tt/eA8V8J On-demand storage startup MakeSpace picks up another $55M https://ift.tt/2ykMqCy

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Why don’t more VCs care about good tech (yet)?

Johannes Lenhard Contributor

Dr. Johannes Lenhard is Centre Coordinator at the Max Planck Cambridge Centre for Ethics, Economy and Social Change.

One of the VC partners in a well-established London firm told me straight out:

Venture capital is money [laughs], it is a risky asset class, perhaps the wildest asset class […] and it has the biggest possible returns.

I have detailed elsewhere how I think caring more beyond the immediate-return mentality often associated with shareholder value capitalism makes sense (financially and ethically). But the arguments I am making are normative and ideological and don’t describe the status quo of VC investing. The more VCs I speak to — so far more than 150 between Berlin and Silicon Valley — the more it becomes clear that most of them couldn’t care less about environmental, social and governance, impact, sustainability, green tech or what Nicholas Colin calls safety net 2.0. Most VC money last year went into fintech; real estate and automation continue to be big, too. Only a tiny portion of businesses in these areas are remotely “impactful.”

Why, then, have the big, supposedly much less progressive asset managers and funds — from KKR to BlackRock to JPMorgan Chase — started to announce that they do (intend to) care?

What are these institutions sitting at the heart of capitalism seeing turning to ESG guidelines, screaming for more regulation and pushing to make portfolios climate-friendly? Why is it that big CEOs want to shift their efforts away from just shareholder value to benefit all stakeholders? Obviously, it must be about money, about a new investment opportunity. Being “good” must be on the verge of becoming profitable. But why are VCs not getting into that in big waves, the investors who are usually ahead of the curve qua their forward-looking business model?

Don’t get me wrong — there is indeed a class of new VCs that has decided to specialize in impact investing and “social good.” Perhaps with the exception of DBL, most of the funds in this new class, however, have only started recently; none of them will be considered top tier funds yet. Exceptions only confirm the rule, however. While Obvious, itself a B-Corp lead among others by Twitter co-founder Ev Williams, is celebrating the Beyond Meat IPO, Greylock is struggling to recruit more than one female into its investment team and is still most keen on blitzscaling marketplaces. While in Germany, Ananda is the only self-fashioned impact investor, sector heavy-hitters such as Holtzbrinck, Earlybird and Point9 are still struggling with the future of e-commerce and SaaS and have discovered gaming as a way of making a 3x return.

Why? Why is dumb money that sits in KKR and is only supposed to strive for the biggest available profit imposing ESG guidelines on itself while hundreds of clever VC general partners are seemingly closing their eyes and path-dependably follow their old-school patterns chasing disruption everywhere but in “the good” and “impact?”

Here are six hypotheses and excuses:

1. It isn’t clear what “impact” even is. While GIIN, the OECD the UN and others are publishing new metrics for ESG and impact measures almost on a daily basis (also reinventing the language around it), the people on the ground doing the investing find it hard to keep up. As many dedicated impact investors I have spoken to, as many different ways of interpreting it I have seen. Some of the VCs I interviewed hence find a relatively easy way out: How are you supposed to aim if you don’t know what your target is?

2. In the VC world, there aren’t reliable return numbers for impact investing yet. VCs have a strong instinct for herding; while seemingly new territory should be what they are used to, when it comes to proven financial return patterns, they often turn a blind eye. As long as there are no data points to prove — also with regards to communicating with their LPs — that “good tech” makes financial sense in the VC world, many won’t move.

3. Why change when what has worked continues to work? The VC business model of doing high-risk investments into mostly technology and biotech has worked very well; in fact, the ongoing low-interest rate environment has driven increasing amounts of capital into the asset class that is looking for exactly the kind of above-average returns the traditional VC model has generated. Why change that now?

4. The others are not really investing real money into impact either. It is true — lots of asset managers and PE investors have publicized their intentions about “going ESG” or “doing impact” widely, but not too much capital has yet been deployed concretely. Bain’s Double Impact fund is $390 million (versus the approximately $30 billion of Bain’s assets under management); KKR’s Global Impact fund is $1 billion, versus around $300 billion under management.

5. The pressure on other asset managers is much higher. On the one hand, LPs have a bigger influence over big asset managers (and they can often be the ones driving change), and on the other, the KKRs and BlackStones of the world need to overcompensate even more for how bad society thinks they are. Virtue signaling — just like CSR — is a good way of doing that (particularly if there is indeed a financial opportunity).

6. Lots of people in VC self-select to not care. As a former partner in a famous SV firm put it to me recently: young people don’t become VCs today to do good, they do it to make a fortune and wield power. While the tech world might have once been run by utopians like Steve Jobs, the wheel is now in the hands of techno-libertarians building cities in the sea, buying up NZ and (at times) supporting Trump (to then make money off that connection by extending surveillance). You reap what you sow.

But even if some of the above excuses are real — for-profit impact is in fact still a tiny asset class (see latest GIIN numbers) for instance — aren’t VCs usually ahead of the game? Contrarian and looking for the next narrative violation? Isn’t it the VCs’ task to sniff up new investment opportunities and sectors first? Most importantly: How long are VCs going to ignore the massively growing consumer appetite for responsible and impactful business (and investing, as KPMG recently found)?

So, the question remains puzzling for me: When will we see the first Tier 1 VC-firm (after Kleiner Perkins in the 2000s) announce that they’ll start a ‘”good tech” fund?

https://ift.tt/eA8V8J Why don’t more VCs care about good tech (yet)? https://ift.tt/3e7oGkI

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Facebook’s new safety feature for women in India: Easily lock the account from strangers

Facebook has rolled out a new safety feature in India that will enable users to easily lock their account so that people they are not friends with on the platform cannot view their posts and zoom into and download their profile picture and cover photo.

The feature is especially aimed at women to give them more control over their Facebook experience, the company said. “We are deeply aware of the concerns people in India, particularly women, have about protecting their online profile,” said Ankhi Das, Public Policy Director at Facebook India, in a statement.

Locking the profile applies multiple existing privacy settings and several new measures to a user’s Facebook profile in a few taps, the company said. Once a user has locked their account, people they are not friends with will no longer be able to see photos and posts — both historic and new — and zoom into, share, and download profile pictures and cover photos.

“We have often heard from young girls that they are hesitant to share about themselves online and are intimidated by the idea of someone misusing their information. I am very happy to see that Facebook is making efforts to learn about their concerns and building products that can give them the experience they want. This new safety feature will give women, especially young girls a chance to express themselves freely,” said Ranjana Kumari, Director at New Delhi-based women advocacy group Centre for Social Research, in a statement.

A user can lock the account by tapping on More under their name, then tapping the Lock Profile button and the confirmation button that prompts afterward.

Prior to Thursday’s announcement, this feature was available to users in Bangladesh, a Facebook spokesperson told TechCrunch.

The new feature appears to be an extension of a similar effort Facebook made in 2017 in India to combat catfishing. That feature, called Profile Picture Guard, allowed users to protect their profile picture from being zoomed into and shared by their friends and those not in the friend list.

from Social – TechCrunch https://ift.tt/3cRUFoP Facebook’s new safety feature for women in India: Easily lock the account from strangers Manish Singh https://ift.tt/3e6ovGd
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