Colombian point-of-sale lender ADDI nabs $12.5 million from Andreessen Horowitz

Andreessen Horowitz <3 Latin American startups.

Latin America is the only region outside of the U.S. where the venture firm is routinely investing capital, and it just made another commitment, doubling down on its early-stage support for the point-of-sale lending startup ADDI.

ADDI picked up $12.5 million in new financing in April of this year as the company looks to expand its lending services online.

For an American audience, the closest corollary to what ADDI is up to is likely Affirm, the point-of-sale lender that’s raised a ton of cash and come in for some (valid) criticism for its basic business model.

Like Affirm, ADDI lets its borrowers apply for credit at the moment of purchase. The company likens its service to the layaway and credit plans that already exist in Colombia — but involve pretty onerous requirements to use. Company co-founder Santiago Suarez and Andreessen Horowitz general partner Angela Strange both commented on how, in some cases, Colombian shoppers have to have three people vouch for a borrower before a store will issue credit or agree to a layaway plan.

The difference between an ADDI loan — or any loan — and layaway is that an installment payment plan doesn’t charge interest (and even with the fees that installment plans do charge, they are often still cheaper than taking out a loan).

But financial products are coming for consumers in Latin America whether those buyers like it or not — and for the most part, it seems they do like it.

Historically, only the wealthiest clientele in Latin America received anything resembling the kinds of financial products that are more widely available in the United States, according to Strange. And the investment in ADDI is just part of her firm’s thesis in trying to make more services more broadly available in a region where a technological transformation is creating unprecedented opportunities for challengers.

That assessment is what drew Santiago Suarez back to Latin America only two years ago. A former executive at Lending Club who previously had worked as the head of New Product Development and Emerging Services at J.P. Morgan, Suarez saw the tremendous growth happening in Latin America and returned to Colombia to see if he could bring some much needed services to his home country.

Suarez partnered with his childhood friend, Elmer Ortega, who was working as the chief technology officer of the local hedge fund where he had previously been employed as a derivatives trader before learning how to code.

Together, the two men, who had known each other since they were five years old, set out to transform how credit was offered in retail shops. It’s an industry that Suarez had known well since his parents had owned stores.

“In the U.S. there are all of these gaps that fintech companies are filling,” says Suarez. “But the gaps in Latin America are bigger.”

Suarez and Ortega incorporated the company in September 2018, around the same time they raised $2.3 million from the regional investment firm, Monashees, Andreessen and Village Global. They then raised another $1.5 million in an internal round of financing before closing the most recent funding.

The company offers loans at annual percentage rates ranging from 19.99% to 28.90%. The company started with a digital solution for brick and mortar retailers because 90% of retail in Colombia still happens offline. 

Although it’s in its early days, the company has already originated 10,000 borrowers and typically loans out roughly $500 since it launched on February 22, according to Suarez. He declined to comment on the company’s default rate on loans.

Now with 40 employees on staff, the company is looking to bring its lending tool to more e-commerce and physical retailers, according to Suarez. And despite the threat of cyclical political turmoil, Suarez says there’s no better time to be investing in Colombia. 

“It’s the most stable country outside of Chile… Way more stable than Brazil, way more stable than Argentina and way more stable than Mexico,” Suarez says. “What we’re looking at is more than cyclical instability… those things go beyond that. Nubank was able to build a multibillion business in the worst political and economic crisis in Brazil’s history. I think Colombia is an incredibly attractive space with a deep talent pool.”


By Jonathan Shieber

Here’s Mary Meeker’s 2019 internet trends report

The Internet Trends Report — everyone’s favorite slide deck — is back. Bond Capital founder and former Kleiner Perkins general partner Mary Meeker made her presentation on stage at Vox/Recode’s Code Conference in Scottsdale, Arizona on Tuesday.

Meeker first crafted a report of this kind, which highlights the most important statistics and technology trends on the internet, in 1995.

This morning, Meeker highlighted slowed growth in ecommerce sales, increased internet ad spending, data growth, as well as the rise of freemium subscription business models, telemedicine, photo-sharing, interactive gaming, the on-demand economy and more.

“If it feels like we’re all drinking from a data firehose, it’s because we are,” Meeker told the audience.

The “Queen of the internet” made references to Slack, Stripe, Spotify, Dropbox, Discord, Twitch, Zoom, Stitch Fix, Instagram, and Bond portfolio company Canva as she reviewed her slides.

It’s been a busy past year for the former Morgan Stanley analyst, who since releasing the 2018 internet trends report last May, exited Kleiner Perkins and raised more than $1 billion for her debut growth fund, Bond.

We’ll be back later with a full analysis of this year’s report. For now, here’s a look at all 333 slides. You can view the full internet trends report archive here.

Mary Meeker raises $1.25B for Bond, her debut growth fund


By Kate Clark

Microsoft and Oracle link up their clouds

Microsoft and Oracle announced a new alliance today that will see the two companies directly connect their clouds over a direct network connection so that their users can then move workloads and data seamlessly between the two. This alliance goes a bit beyond just basic direct connectivity and also includes identity interoperability.

This kind of alliance is relatively unusual between what are essentially competing clouds, but while Oracle wants to be seen as a major player in this space, it also realizes that it isn’t likely to get to the size of an AWS, Azure or Google Cloud anytime soon. For Oracle, this alliance means that its users can run services like the Oracle E-Business Suite and Oracle JD Edwards on Azure while still using an Oracle database in the Oracle cloud, for example. With that, Microsoft still gets to run the workloads and Oracle gets to do what it does best (though Azure users will also continue be able to run their Oracle databases in the Azure cloud, too).

“The Oracle Cloud offers a complete suite of integrated applications for sales, service, marketing, human resources, finance, supply chain and manufacturing, plus highly automated and secure Generation 2 infrastructure featuring the Oracle Autonomous Database,” said Don Johnson, executive vice president, Oracle Cloud Infrastructure (OCI), in today’s announcement. “Oracle and Microsoft have served enterprise customer needs for decades. With this alliance, our joint customers can migrate their entire set of existing applications to the cloud without having to re-architect anything, preserving the large investments they have already made.”

For now, the direct interconnect between the two clouds is limited to Azure US East and Oracle’s Ashburn data center. The two companies plan to expand this alliance to other regions in the future, though they remain mum on the details. It’ll support applications like JD Edwards EnterpriseOne, E-Business Suite, PeopleSoft, Oracle Retail and Hyperion on Azure, in combination with Oracle databases like RAC, Exadata and the Oracle Autonomous Database running in the Oracle Cloud.

“As the cloud of choice for the enterprise, with over 95% of the Fortune 500 using Azure, we have always been first and foremost focused on helping our customers thrive on their digital transformation journeys,” said Scott Guthrie, executive vice president of Microsoft’s Cloud and AI division. “With Oracle’s enterprise expertise, this alliance is a natural choice for us as we help our joint customers accelerate the migration of enterprise applications and databases to the public cloud.”

Today’s announcement also fits within a wider trend at Microsoft, which has recently started building a number of alliances with other large enterprise players, including its open data alliance with SAP and Adobe, as well as a somewhat unorthodox gaming partnership with Sony.

 


By Frederic Lardinois

Fintech and clean tech? An odd couple or a perfect marriage?

The Valley’s rocky history with clean tech investing has been well-documented.

Startups focused on non-emitting generation resources were once lauded as the next big cash cow, but the sector’s hype quickly got away from reality.

Complex underlying science, severe capital intensity, slow-moving customers, and high-cost business models outside the comfort zones of typical venture capital, ultimately caused a swath of venture-backed companies and investors in the clean tech boom to fall flat.

Yet, decarbonization and sustainability are issues that only seem to grow more dire and more galvanizing for founders and investors by the day, and more company builders are searching for new ways to promote environmental resilience.

While funding for clean tech startups can be hard to find nowadays, over time we’ve seen clean tech startups shift down the stack away from hardware-focused generation plays towards vertical-focused downstream software.

A far cry from past waves of venture-backed energy startups, the downstream clean tech companies offered more familiar technology with more familiar business models, geared towards more recognizable verticals and end users. Now, investors from less traditional clean tech backgrounds are coming out of the woodworks to take a swing at the energy space.

An emerging group of non-traditional investors getting involved in the clean energy space are those traditionally focused on fintech, such as New York and Europe based venture firm Anthemis — a financial services-focused team that recently sat down with our fintech contributor Gregg Schoenberg and I (check out the full meat of the conversation on Extra Crunch).

The tie between clean tech startups and fintech investors may seem tenuous at first thought. However, financial services has long played a significant role in the energy sector and is now becoming a more common end customer for energy startups focused on operations, management and analytics platforms, thus creating real opportunity for fintech investors to offer differentiated value.

Finance powering the world?

Though the conversation around energy resources and decarbonization often focuses on politics, a significant portion of decisions made in the energy generation business is driven by pure economics — Is it cheaper to run X resource relative to resources Y and Z at a given point in time? Based on bid prices for Request for Proposals (RFPs) in a specific market and the cost-competitiveness of certain resources, will a developer be able to hit their targeted rate of return if they build, buy or operate a certain type of generation asset?

Alternative generation sources like wind, solid oxide fuel cells, or large-scale or even rooftop solar have reached more competitive cost levels – in many parts of the US, wind and solar are in fact often the cheapest form of generation for power providers to run.

Thus as renewable resources have grown more cost competitive, more, infrastructure developers, and other new entrants have been emptying their wallets to buy up or build renewable assets like large scale solar or wind farms, with the American Council on Renewable Energy even forecasting cumulative private investment in renewable energy possibly reaching up to $1 trillion in the US by 2030.

A major and swelling set of renewable energy sources are now led by financial types looking for tools and platforms to better understand the operating and financial performance of their assets, in order to better maximize their return profile in an increasingly competitive marketplace.

Therefore, fintech-focused venture firms with financial service pedigrees, like Anthemis, now find themselves in pole position when it comes to understanding clean tech startup customers, how they make purchase decisions, and what they’re looking for in a product.

In certain cases, fintech firms can even offer significant insight into shaping the efficacy of a product offering. For example, Anthemis portfolio company kWh Analytics provides a risk management and analytics platform for solar investors and operators that helps break down production, financial analysis, and portfolio performance.

For platforms like kWh analytics, fintech-focused firms can better understand the value proposition offered and help platforms understand how their technology can mechanically influence rates of return or otherwise.

The financial service customers for clean energy-related platforms extends past just private equity firms. Platforms have been and are being built around energy trading, renewable energy financing (think financing for rooftop solar) or the surrounding insurance market for assets.

When speaking with several of Anthemis’ clean tech portfolio companies, founders emphasized the value of having a fintech investor on board that not only knows the customer in these cases, but that also has a deep understanding of the broader financial ecosystem that surrounds energy assets.

Founders and firms seem to be realizing that various arms of financial services are playing growing roles when it comes to the development and access to clean energy resources.

By offering platforms and surrounding infrastructure that can improve the ease of operations for the growing number of finance-driven operators or can improve the actual financial performance of energy resources, companies can influence the fight for environmental sustainability by accelerating the development and adoption of cleaner resources.

Ultimately, a massive number of energy decisions are made by financial services firms and fintech firms may often times know the customers and products of downstream clean-tech startups more than most.  And while the financial services sector has often been labeled as dirty by some, the vital role it can play in the future of sustainable energy offers the industry a real chance to clean up its image.


By Arman Tabatabai

Wagestream closes $51M Series A to plug the payday gap without putting workers in debt

Getting your work wages on a monthly (not weekly nor biweekly) basis has become a more widespread trend as the price of running payrolls has gone up, and organizations’ cashflow has gone down. That 30-day shift may be a boost to employers, but not employees, who may need access to those wages more immediately and find it a challenge to stretch out their income month to month.

Now, a startup based out of London has raised a large round of funding for service that’s aiming to plug that gap. Wagestream — which works with employers to let employees draw down a percentage of their income in the month for a small, flat fee — today said that it has closed a Series A round of £40 million ($51 million).

The funding is coming in the form of equity and debt, with Balderton and Northzone leading on the equity side, which makes up £15 million of the raise, and savings bank Shawbrook investing £25 million on the debt side to finance employee draw-downs. Other investors in the round include QED, the Rowntree Foundation, the London Co-investment Fund (LCIF) and Village Global, a social venture firm backed by Bill Gates and Jeff Bezos, among others.

The company is not disclosing its valuation but this brings the total raised to just under £45 million and “the valuation is definitely higher now”, according to CEO and co-founder Peter Briffett.

The list of investors is proving to be a useful one for Wagestream as it grows. I asked if Bezos’ company Amazon was working with Wagestream. Briffett confirmed it is not a customer currently, “but we are talking to them.” It does, however, have a number of other customers already signed up, including pest removal service Rentokil PLC, Camden Town Brewery, the Slug & Lettuce pub chain and Carluccio’s chain of eateries, along with the NHS and Hackney Council — covering some 120,000 workers in all.

Amazon is an indicative example of one of the big opportunities for the company, which today is active in the UK but aiming to expand across Europe and the rest of the world.

While it is one of the biggest employers in the tech world, where it might typically pay out six-figure salaries in senior management, operational and technical roles, it’s also building out its business by being one of the biggest employers also of hourly workers in its warehouses, wider logistics operations and similar areas. It’s employees like these who might be considered the first wave of employees that Wagestream is initially targeting, some of whom may be earning just enough or slightly more than enough to get by (at best), and face being victims of what Briffett referred to as the “payday poverty cycle.”

Getting paid monthly today accounts for some 85 percent of all paychecks in the UK today, and the proportion is similar in Europe and also getting increasingly common in the US, Briffett — who has also worked at Microsoft, LivingSocial (when it was still backed by Amazon, and where he started the UK operation and ran it as the CEO for years), and YPlan (acquired by Time Out) — said in an interview. You might ask: why don’t the workers just budget better? But it doesn’t always work out that way, especially the longer the gap is between paychecks, and if you, for example, have an unexpected expense to cover.

Because of that ubiquity, and the acuteness of the problem (if you’ve ever earned just about enough, or been a child in a family whose parents did, you may understand the predicament quite well ), Wagestream is not the first time that we’ve seen a financial services startup emerge to target that demographic.

Some other attempts have been scandalously disastrous, however: recall “Payday Loan” provider Wonga, backed by an illustrious set of investors but ultimately accused of, and hit hard by regulators and the public for, preying on people who were in need of funds with loans that were not transparent enough in their terms and led the borrowers into deep debt.

Wonga itself paid a big price for its practices, and the company is now bankrupt (and apparently still unable to replay creditors, as of the last report in March).

It was the disaster of Wonga — and an article in the WSJ about alternatives to payday loans — that Briffett said got him thinking about the possibilities and building Wagestream. (Ironic note: if you use PitchBook as I do, Wonga is listed among Wagestream’s backers, which Briffett assures me is an error.)

Wagestream positions itself as a “social impact” startup for targeting a very real problem that impacts financial inclusion for a proportion of the population, and it says this represents one of the highest rounds ever for a startup in the UK aimed at social impact.

“We fell in love with the strong product-market fit of Wagestream. We very rarely hear such universal positive feedback from all who have tried a product,” said Rob Moffat, a partner at Balderton, in a statement. “Companies used to take an active role in supporting the financial health of their users but this has slowly been eroded, to the extent where employees paid at the end of the month are effectively subsidising their employer for 29 days a month. Wagestream starts to restore the right balance.”

Wagestream operates by striking deals with employers to offer its services to its workers, who download an app and link up Wagestream with their salary and banking details. Businesses are able to set limits for what percentage of their wages employees can draw down each month, and how often the service can be used. Typically the limit is around 40 percent of a monthly wage, Briffett said.

Employees then can get the money instantly by paying a fee of £1.75 per withdrawal. “We are funding all of the withdrawals up front,” Briffett said. “We are the first company to marry workforce management and financial data.”

Down the road, the plan will be to expand to Europe as well as to the US, where there are already some other services that are trying to tackle the same problem, such as Instant Financial and DailyPay. There are also a number of areas the company could move into, such as working with companies that employ contract workers, and providing additional financial services to workers already using the app to draw down funds.

More expansion, Briffett said, will inevitably also mean more funding particularly on the debt side.

For now, the emergence of Wavestream is an encouraging sign of how VCs are not just interested in tapping their coffers to bet on tech companies that they think will be hits. They also want to hunt for those whose returns may well be strong, but ultimately are made stronger by the longer-term effect they might have on the wider landscape of consumers, how they interface with fintech, and continue their own progress in the world.


By Ingrid Lunden

Under the hood on Zoom’s IPO, with founder and CEO Eric Yuan

Extra Crunch offers members the opportunity to tune into conference calls led and moderated by the TechCrunch writers you read every day. This week, TechCrunch’s Kate Clark sat down with Eric Yuan, the founder and CEO of video communications startup Zoom, to go behind the curtain on the company’s recent IPO process and its path to the public markets.

Since hitting the trading desks just a few weeks ago, Zoom stock is up over 30%. But the Zoom’s path to becoming a Silicon Valley and Wall Street darling was anything but easy. Eric tells Kate how the company’s early focus on profitability, which is now helping drive the stock’s strong performance out of the gate, actually made it difficult to get VC money early on, and the company’s consistent focus on user experience led to organic growth across different customer bases.

Eric: I experienced the year 2000 dot com crash and the 2008 financial crisis, and it almost wiped out the company. I only got seed money from my friends, and also one or two VCs like AME Cloud Ventures and Qualcomm Ventures.

nd all other institutional VCs had no interest to invest in us. I was very paranoid and always thought “wow, we are not going to survive next week because we cannot raise the capital. And on the way, I thought we have to look into our own destiny. We wanted to be cash flow positive. We wanted to be profitable.

nd so by doing that, people thought I wasn’t as wise, because we’d probably be sacrificing growth, right? And a lot of other companies, they did very well and were not profitable because they focused on growth. And in the future they could be very, very profitable.

Eric and Kate also dive deeper into Zoom’s founding and Eric’s initial decision to leave WebEx to work on a better video communication solution. Eric also offers his take on what the future of video conferencing may look like in the next five to 10 years and gives advice to founders looking to build the next great company.

For access to the full transcription and the call audio, and for the opportunity to participate in future conference calls, become a member of Extra Crunch. Learn more and try it for free. 

Kate Clark: Well thanks for joining us Eric.

Eric Yuan: No problem, no problem.

Kate: Super excited to chat about Zoom’s historic IPO. Before we jump into questions, I’m just going to review some of the key events leading up to the IPO, just to give some context to any of the listeners on the call.


By Arman Tabatabai

OpenFin raises $17 million for its OS for finance

OpenFin, the company looking to provide the operating system for the financial services industry, has raised $17 million in funding through a Series C round led by Wells Fargo, with participation from Barclays and existing investors including Bain Capital Ventures, J.P. Morgan and Pivot Investment Partners. Previous investors in OpenFin also include DRW Venture Capital, Euclid Opportunities and NYCA Partners.

Likening itself to “the OS of finance”, OpenFin seeks to be the operating layer on which applications used by financial services companies are built and launched, akin to iOS or Android for your smartphone.

OpenFin’s operating system provides three key solutions which, while present on your mobile phone, has previously been absent in the financial services industry: easier deployment of apps to end users, fast security assurances for applications, and interoperability.

Traders, analysts and other financial service employees often find themselves using several separate platforms simultaneously, as they try to source information and quickly execute multiple transactions. Yet historically, the desktop applications used by financial services firms — like trading platforms, data solutions, or risk analytics — haven’t communicated with one another, with functions performed in one application not recognized or reflected in external applications.

“On my phone, I can be in my calendar app and tap an address, which opens up Google Maps. From Google Maps, maybe I book an Uber . From Uber, I’ll share my real-time location on messages with my friends. That’s four different apps working together on my phone,” OpenFin CEO and co-founder Mazy Dar explained to TechCrunch. That cross-functionality has long been missing in financial services.

As a result, employees can find themselves losing precious time — which in the world of financial services can often mean losing money — as they juggle multiple screens and perform repetitive processes across different applications.

Additionally, major banks, institutional investors and other financial firms have traditionally deployed natively installed applications in lengthy processes that can often take months, going through long vendor packaging and security reviews that ultimately don’t prevent the software from actually accessing the local system.

OpenFin CEO and co-founder Mazy Dar. Image via OpenFin

As former analysts and traders at major financial institutions, Dar and his co-founder Chuck Doerr (now President & COO of OpenFin) recognized these major pain points and decided to build a common platform that would enable cross-functionality and instant deployment. And since apps on OpenFin are unable to access local file systems, banks can better ensure security and avoid prolonged yet ineffective security review processes.

And the value proposition offered by OpenFin seems to be quite compelling. Openfin boasts an impressive roster of customers using its platform, including over 1,500 major financial firms, almost 40 leading vendors, and 15 out of the world’s 20 largest banks.

Over 1,000 applications have been built on the OS, with OpenFin now deployed on more than 200,000 desktops — a noteworthy milestone given that the ever popular Bloomberg Terminal, which is ubiquitously used across financial institutions and investment firms, is deployed on roughly 300,000 desktops.

Since raising their Series B in February 2017, OpenFin’s deployments have more than doubled. The company’s headcount has also doubled and its European presence has tripled. Earlier this year, OpenFin also launched it’s OpenFin Cloud Services platform, which allows financial firms to launch their own private local app stores for employees and customers without writing a single line of code.

To date, OpenFin has raised a total of $40 million in venture funding and plans to use the capital from its latest round for additional hiring and to expand its footprint onto more desktops around the world. In the long run, OpenFin hopes to become the vital operating infrastructure upon which all developers of financial applications are innovating.

Apple and Google’s mobile operating systems and app stores have enabled more than a million apps that have fundamentally changed how we live,” said Dar. “OpenFin OS and our new app store services enable the next generation of desktop apps that are transforming how we work in financial services.”


By Arman Tabatabai

Beyond costs, what else can we do to make housing affordable?

This week on Extra Crunch, I am exploring innovations in inclusive housing, looking at how 200+ companies are creating more access and affordability. Yesterday, I focused on startups trying to lower the costs of housing, from property acquisition to management and operations.

Today, I want to focus on innovations that improve housing inclusion more generally, such as efforts to pair housing with transit, small business creation, and mental rehabilitation. These include social impact-focused interventions, interventions that increase income and mobility, and ecosystem-builders in housing innovation.

Nonprofits and social enterprises lead many of these innovations. Yet because these areas are perceived to be not as lucrative, fewer technologists and other professionals have entered them. New business models and technologies have the opportunity to scale many of these alternative institutions — and create tremendous social value. Social impact is increasingly important to millennials, with brands like Patagonia having created loyal fan bases through purpose-driven leadership.

While each of these sections could be their own market map, this overall market map serves as an initial guide to each of these spaces.

Social impact innovations

These innovations address:


By Arman Tabatabai

Innovations in inclusive housing

Housing is big money. The industry has trillions under management and hundreds of billions under development.

And investors have noticed the potential. Opendoor raised nearly $1.3 billion to help homeowners buy and sell houses more quickly. Katerra raised $1.2 billion to optimize building development and construction, and Compass raised the same amount to help brokers sell real estate better. Even Amazon and Airbnb have entered the fray with high-profile investments.

Amidst this frenetic growth is the seed of the next wave of innovation in the sector. The housing industry — and its affordability problem — is only likely to balloon. By 2030, 84% of the population of developed countries will live in cities.

Yet innovation in housing lags compared to those of other industries. In construction, a major aspect of housing development, players spend less than 1% of their revenues on research and development. Technology companies, like the Amazons of the world, spend nearly 10% on average.

Innovations in older, highly-regulated industries, like housing and real estate, are part of what Steve Case calls the “third wave” of technology. VCs like Case’s Revolution Fund and the SoftBank Vision Fund are investing billions into what they believe is the future.

These innovations are far from silver bullets, especially if they lack involvement from underrepresented communities, avoid policy, and ignore distributive questions about who gets to benefit from more housing.

Yet there are hundreds of interventions reworking housing that cannot be ignored. To help entrepreneurs, investors, and job seekers interested in creating better housing, I mapped these innovations in this package of articles.

To make sense of this broad field, I categorize innovations into two main groups, which I detail in two separate pieces on Extra Crunch. The first (Part 1) identifies the key phases of developing and managing housing. The second (Part 2) section identifies interventions that contribute to housing inclusion more generally, such as efforts to pair housing with transit, small business creation, and mental rehabilitation.

Unfortunately, many of these tools don’t guarantee more affordability. Lowering acquisition costs, for instance, doesn’t mean that renters or homeowners will necessarily benefit from those savings. As a result, some tools likely need to be paired with others to ensure cost savings that benefit end users — and promote long-term affordability. I detail efforts here so that mission-driven advocates as well as startup founders can adopt them for their own efforts.


Topics We Explore

Today:

Coming Tomorrow:

  • Part 2. Other contributions to housing affordability
    • Social Impact Innovations
    • Landlord-Tenant Tools
    • Innovations that Increase Income
    • Innovations that Increase Transit Accessibility and Reduce Parking
    • Innovations that Improve the Ability to Regulate Housing
    • Organizations that Support the Housing Innovation Ecosystem
  • This is Just the Beginning
  • I’m Personally Closely Watching the Following Initiatives.
  • The Limitations of Technology
  • Move Fast and Protect People


Please feel free to let me know what else is exciting by adding a note to your LinkedIn invite here.

If you’re excited about this topic, feel free to subscribe to my future of inclusive housing newsletter by viewing a past issue here.


By Arman Tabatabai

Market map: the 200+ innovative startups transforming affordable housing

In this section of my exploration into innovation in inclusive housing, I am digging into the 200+ companies impacting the key phases of developing and managing housing.

Innovations have reduced costs in the most expensive phases of the housing development and management process. I explore innovations in each of these phases, including construction, land, regulatory, financing, and operational costs.

Reducing Construction Costs

This is one of the top three challenges developers face, exacerbated by rising building material costs and labor shortages.


By Arman Tabatabai

India’s Locus raises $22 million to expand its logistics management business

Locus, an Indian startup that uses AI to help businesses map out their logistics, has raised $22 million in Series B funding to expand its operations in international markets.

The financing round for the four-year-old startup was led by Falcon Edge Capital and Tiger Global Management . Existing investors Exfinity Venture Partners and Blume Ventures also participated in the round. The startup has raised $29 million to date, Nishith Rastogi, co-founder and CEO of Locus, told TechCrunch in an interview.

Locus works with companies that operate in FMCG, logistics, and e-commerce spaces. Some of its clients include Tata Group companies, Myntra, BigBasket, Lenskart, and Bluedart. It helps these clients automate their logistics workload — tasks such as planning, organizing, transporting and tracking of inventories, and finding the best path to reach a destination — that have traditionally required intensive human labor.

“Say a Lenskart representative is visiting a house or an office to offer an eye checkup, and suddenly two more people there are interested in getting their eyes checked. The representative could attend these two new potential clients, or wrap things up with the first client and take care of his or her next appointment,” said Rastogi.

Locus looks at a client’s past data, identifies patterns, and automates these kind of decisions on a large scale. In an example shared earlier with TechCrunch, Rastogi talked about how Locus had built a scanner for ecommerce companies for measuring products.

Rastogi said he will use the fresh capital to develop products and expand Locus in Southeast Asian and North American markets. The startup says half of its 110 people workforce is outside of India. Half of the IP it has built and the revenue it generates comes from its team outside of India.

He said the startup has spent the recent quarters studying these international markets, and has secured some anchor clients to expand the business. Locus is operationally profitable already and any additional capital goes into expanding its business, he added.

The logistics market in India has long been riddled with challenges. A growing number of startups, including BlackBuck — which raised $150 million last week — have emerged in recent years to tackle these problems.

The new funding also illustrates Tiger Global Management’s new strategy for the Indian market. The VC fund, which has invested in B2C businesses Flipkart and Ola in India, has made a number of investments in B2B startups in recent months. Last month, it invested $90 million in agri-tech supply chain startup Ninjacart, and weeks later, it gave cloud-based solutions provider Zenoti $50 million.


By Manish Singh

Airbase launches with $7M Series A to simplify spending control systems

Airbase is a startup with a plan to change the way you think about accounting around spending. Instead of multiple workflows, it wants to create a simpler one involving, well, Airbase. It’s a bold move for any startup to take on something as entrenched as financials, but it’s giving it a shot, and today the company launched with a $7 million Series A investment.

First Round Capital was lead investor. Maynard Webb, Village Global, BoxGroup and Quiet Capital also participated. The deal closed at the end of November last year. This is the first external funding for the company, which company founder and CEO, Thejo Kote had bootstrapped previously with $300,000 of his own money.

“At a high level, Airbase is the first all-in-one spend management system. It replaces a number of different systems that companies use to manage how they spend money,” Kote told TechCrunch.

He knows of what he speaks. Prior to starting this company, Kote co-founded Automatic, a startup that he sold to SiriusXM for more than $100 million in 2017. As a founder, he saw just how difficult it was to track the vast variety of spending inside a company from supplies to subscriptions to food and drink.

“Think about the hundreds of things that companies spend money on, and the way in which the management of that happens is a pretty broken process today,” he said. For starters, it usually involves some sort of approval request in a tool like Slack, Jira or Google forms.

Once approved, the person requesting the expense will put that on a company credit card, then have to submit expense reports at the end of each month using a tool like Expensify. If you purchase from vendor, then that involves an invoice and that has to be processed and paid. Finally it would need to be reconciled and accounted for in accounting software. Each step of this process ends up being time-consuming and costly for an organization.

Kote’s idea was to take this process and streamline it by removing the friction, which he saw as being related to the disparate systems in place to get the work done. He believed by creating a single workflow on a unified, single platform he could create a smoother system for everyone involved.

He is putting that single system in between the bank and the accounting system including a virtual Airbase Visa card to take the place of physical cards. Request for spending happens inside Airbase instead of an external tool. When the virtual card gets charged, bookkeeping and reconciliation gets handled in Airbase and pushed to your accounting package of choice.

Airbase workflow. Diagram: Airbase

This could be a difficult proposition for companies with existing systems in place, but could be attractive to startups and small companies whose accounting systems have not yet hardened. Perhaps that’s why most of Airbase’s customers are startups or SMBs with between 500 and 5000 employees, such as Gusto, Netlify and Segment.

Bill Trenchard, General Partner at lead investor First Round Capital says he has seen very little innovation in this space and that’s what drew him to Airbase. “Airbase has taken a bold step forward to create an entirely new paradigm. It delivers a real solution to the biggest problems finance teams face as their companies grow,” Trenchard said in a statement.

The company was founded in 2017 and has 22 employees today. It has a sales office in San Francisco, but other employees are spread across four countries.


By Ron Miller

On balance, the cloud has been a huge boon to startups

Today’s startups have a distinct advantage when it comes to launching a company because of the public cloud. You don’t have to build infrastructure or worry about what happens when you scale too quickly. The cloud vendors take care of all that for you.

But last month when Pinterest announced its IPO, the company’s cloud spend raised eyebrows. You see, the company is spending $750 million a year on cloud services, more specifically to AWS. When your business is primarily focused on photos and video, and needs to scale at a regular basis, that bill is going to be high.

That price tag prompted Erica Joy, a Microsoft engineer to publish this Tweet and start a little internal debate here at TechCrunch. Startups, after all, have a dog in this fight, and it’s worth exploring if the cloud is helping feed the startup ecosystem, or sending your bills soaring as they have with Pinterest.

For starters, it’s worth pointing out that Ms. Joy works for Microsoft, which just happens to be a primary competitor of Amazon’s in the cloud business. Regardless of her personal feelings on the matter, I’m sure Microsoft would be more than happy to take over that $750 million bill from Amazon. It’s a nice chunk of business, but all that aside, do startups benefit from having access to cloud vendors?


By Ron Miller

Peter Kraus dishes on the market

During my recent conversation with Peter Kraus, which was supposed to be focused on Aperture and its launch of the Aperture New World Opportunities Fund, I couldn’t help veering off into tangents about the market in general. Below is Kraus’ take on the availability of alpha generation, the Fed, inflation vs. Amazon, housing, the cross-ownership of US equities by a few huge funds and high-frequency trading.

Gregg Schoenberg: Will alpha be more available over the next five years than it has been over the last five?

To think that at some point equities won’t become more volatile and decline 20% to 30%… I think it’s crazy.

Peter Kraus: Do I think it’s more available in the next five years than it was in the last five years? No. Do I think people will pay more attention to it? Yes, because when markets are up to 30%, if you get another five, it doesn’t matter. When markets are down 30% and I save you five by being 25% down, you care.

GS: Is the Fed’s next move up or down?

PK: I think the Fed does zero, nothing. In terms of its next interest rate move, in my judgment, there’s a higher probability that it’s down versus up.


By Gregg Schoenberg

TradingView acquires TradeIt to add instant trading APIs to its investor toolkit

After raising $37 million to bring its on-the-spot stock market analytics tools to a wider range of publishers and other internet partners, TradingView today has announced its first acquisition to supercharge the services that it offers to investors, wherever they happen to be online. The startup has acquired TradeIt, which has built an API for on-the-spot trading on any site that uses it.

The terms of deal were not disclosed, but we understand from sources close to the deal that it was under $20 million, more specifically in the “high teens.” TradeIt, which used to be called Trading Ticket, had raised about $12 million from investors that included Peter Thiel’s mostly-fintech fund Valar Ventures, Citi Ventures and others. TradingView had raised just over $40 million with investors including Insight Partners, TechStars and others.

The deal is a big move for consolidation: together the two say they will serve more than 10 million monthly active users in 150 countries, covering some $70 billion in linked assets. But also, better economies of scale, and better margins for companies that provide services that touch consumers not necessarily from a “home” of their own.

The latter is a growing trend that has mirrored the rise of social media and other services that aggregate content from multiple sources; and also the bigger trend of instant, on-demand everything, where consumers are happier with the convenience of buying or engaging with something right when they want to, rather than shopping around, delaying or navigating to another place to do it.

That has also seen the rise of commerce APIs to buy things instantly, not to mention the emergence of a wide range of commerce applications that let people easily buy goods and services on the spot. (And in line with that, TradingView says that nearly half of its user base today is millennials, with an additional 13 percent even younger, Gen Z. “The groups are particularly drawn to [our] extensive charting expertise,” the company says.)

In fintech, and in the world of investing specifically, that’s a trend that has also helped the growth of cryptocurrency, which has opened up the world of investing and thinking about investing to a whole new class of consumers who — for better or worse — are hearing about investing opportunities via viral social media campaigns and other new kinds of channels. Whether cryptocurrency speculation bears out longer term, it is depositing a new class of people into the world of thinking about companies and investing in them.

That taps into the sweet spot where TradeIt and TradingView are building their business.

“TradeIt’s secure and compliant relationships with established U.S. retail brokerages, coupled with their robust integrations with top investing apps, allows TradingView to be part of the backbone of the investing ecosystem,” said Denis Globa, TradingView founder and CEO, in a statement.

TradingView’s partners today include Crunchbase, Investopedia, SeekingAlpha, Zacks, Binance, CME Group and Entrepreneur, where users are able to access a premium tier of TradingView tools by way of a subscription in order to do some instant data and price modelling of a company that they might be reading about. The thinking is that now they will also be able to go one step further by trading stocks related to that information. TradingView, meanwhile, can use that extra feature to make a little more money and sell its service to partners as more sticky, to the tune of 80 percent more time spent with publishers as a result of integrating TradingView’s tools.

That’s something that the two companies can already attest to doing well in partnership.

“TradingView’s vision aligns strongly with our view of the distributed financial networks of the future,” said Nathan Richardson, TradeIt CEO, in a statement. “We’ve worked with TradingView for several years now, and always felt our complementary products and shared retail investing users makes us stronger together.”

Richardson and his cofounder Betsy Eisenberg — who are both joining TradingView — had together built Yahoo Finance — so they are already well experienced in how to leverage the potential of bringing together content with utility.

“Nathan Richardson and Betsy Eisenberg are fintech pioneers who led the development of Yahoo! Finance from scratch. With them on board, we’re extremely excited about the growth potential,” Globa said.


By Ingrid Lunden