Upscribe, raising $4M, wants to drive subscription-first DTC brand growth

Upscribe founder and CEO Dileepan Siva watched the retail industry make a massive shift to subscription e-commerce for physical products over the past decade, and decided to get in it himself in 2019.

The Los Angeles-based company, developing subscription software for direct-to-consumer e-commerce merchants, is Siva’s fourth startup experience and first time as founder. He closed a $4 million seed round to go after two macro trends he is seeing: buying physical products, like consumer-packaged goods, on a recurring basis, and new industries offering subscriptions, like car and fashion companies.

Merchants use Upscribe’s technology to drive subscriber growth, reduce churn and enable their customers to personalize a subscription experience, like skipping shipments, swapping out products and changing the order frequency. Brands can also feature products for upsell purposes throughout the subscriber lifecycle, from checkout to post-purchase.

Upscribe also offers APIs for merchants to integrate tools like Klaviyo, Segment and Shopify — a new subscription offering for checkouts.

Uncork Capital led the seed round and was joined by Leaders Fund, The House Fund, Roach Capitals’ Fahd Ananta and Shippo CEO Laura Behrens Wu.

“As the market for D2C subscriptions booms, there is a need for subscription-first brands to grow and scale their businesses,” said Jeff Clavier, founder and managing partner of Uncork Capital, in a written statement. “We have spent a long time in the e-commerce space, working with D2C brands and companies who are solving common industry pain points, and Upscribe’s merchant-centric approach raised the bar for subscription services, addressing the friction in customer experiences and enabling merchants to engage subscribers and scale recurring revenue growth.”

Siva bootstrapped the company, but decided to go after venture capital dollars when Upscribe wanted to create a more merchant-centric approach, which required scaling with a bigger team. The “real gems are in the data layer and how to make the experience exceptional,” he added.

The company is growing 43% quarter over quarter and is close to profitable, with much of its business stemming from referrals, Siva said. It is already working with customers like Athletic Greens, Four Sigmatic and True Botanicals and across multiple verticals, including food and beverage, health and wellness, beauty and cosmetics and home care.

The new funding will be used to “capture the next wave of brands that are going to grow,” he added. Siva cites the growth will come as the DTC subscription market is forecasted to reach $478 billion by 2025, and 75% of those brands are expected to offer subscriptions in the next two years. As such, the majority of the funding will be used to bring on more employees, especially in the product, customer success and go-to-market functions.

Though there is competition in the space, many of those are focused on processing transactions, while Siva said Upscribe’s approach is customer relationships. The cost of acquiring new customers is going up, and subscription services will be the key to converting one-time buyers into loyal customers.

“It is really about customer relationships and the ongoing engagement between merchants and subscribers,” he added. “We are in a different world now. The first wave could play the Facebook game, advertising on social media with super low acquisition and scale. That is no longer the case anymore.”

 


By Christine Hall

Microsoft brings transcriptions to Word

Microsoft today launched Transcribe in Word, its new transcription service for Microsoft 365 subscribers, into general availability. It’s now available in the online version of Word, with other platforms launching later. In addition, Word is also getting new dictation features, which now allow you to use your voice to format and edit your text, for example.

As the name implies, this new feature lets you transcribe conversations, both live and pre-recorded, and then edit those transcripts right inside of Word. With this, the company goes head-to-head with startups like Otter and Google’s Recorder app, though they all have their own pros and cons.

Image Credits: Microsoft

To get started with Transcribe in Word, you simply head for the dictate button in the menu bar and click on ‘transcribe.’ From there, you can record a conversation as it happens — by recording it directly through a speakerphone and your laptop’s microphone, for example — or by recording it in some other way and then uploading that file. The service accepts .mp3, .wav, .m4a and .mp4 files.

As Microsoft Principal Group PM Manager for Natural User Interface & Incubation, Dan Parish, noted in a press briefing ahead of today’s announcement, when you record a call live, the transcription actually runs in the background while you conduct your interview, for example. The team purposely decided not to show you the live transcript, though, because its user research showed that it was distracting. I admit that I like to see the live transcript in Otter and Recorder, but maybe I’m alone in that.

Like with other services, Transcribe in Word lets you click on individual paragraphs in the transcript and then listen to that at a variety of speeds. Since the automated transcript will inevitably have errors in it, that’s a must-have feature. Sadly, though, Transcribe doesn’t let you click on individual words.

One major limitation of the service right now is that if you like to record offline and then upload your files, you’ll be limited to 300 minutes, without the ability to extend this for an extra fee, for example. I know I often transcribe far more than 5 hours of interviews in any given month, so that limit seems low, especially given that Otter provides me with 6,000 minutes on its cheapest paid plan. The max length for a transcript on Otter is 4 hours while Microsoft’s only limit for is a 200MB file upload limit, with no limits on live recordings.

Another issue I noticed here is that if you mistakenly exit the tab with Word in it, the transcription process will stop and there doesn’t seem to be a way to restart it.

It also takes quite a while for the uploaded files to be transcribed. It takes roughly as long as the conversations I’ve tried to transcribe), but the results are very good — and often better than those of competing services. Transcribe for Word also does a nice job separating out the different speakers in a conversation. For privacy reasons, you must assign your own names to those — even when you regularly record the same people.

It’d be nice to get the same feature in something like OneNote, for example, and my guess is Microsoft may expand this to its note-taking app over time. To me, that’s the more natural place for it.

Image Credits: Microsoft

The new dictation features in Word now let you give commands like “bold the last sentence,” for example, and say “percentage sign” or “ampersand” if you need to add those symbols to a text (or “smiley face,” if those are the kinds of texts you write in Word).

Even if you don’t often need to transcribe text, this new feature shows how Microsoft is now using its subscription service to launch new premium features to convert free users to paying ones. I’d be surprised if tools like the Microsoft Editor (which offers more features for paying users), this transcription service, as well as some of the new AI features in the likes of Excel and PowerPoint, didn’t help to convert some users into paying ones, especially now that the company has combined Office 365 and Microsoft 365 for consumers into a single bundle. After all, just a subscription to something like Grammarly and Otter would be significantly more expensive than a Microsoft 365 subscription.

 


By Frederic Lardinois

How startups can leverage elastic services for cost optimization

Due to COVID-19, business continuity has been put to the test for many companies in the manufacturing, agriculture, transport, hospitality, energy and retail sectors. Cost reduction is the primary focus of companies in these sectors due to massive losses in revenue caused by this pandemic. The other side of the crisis is, however, significantly different.

Companies in industries such as medical, government and financial services, as well as cloud-native tech startups that are providing essential services, have experienced a considerable increase in their operational demands — leading to rising operational costs. Irrespective of the industry your company belongs to, and whether your company is experiencing reduced or increased operations, cost optimization is a reality for all companies to ensure a sustained existence.

One of the most reliable measures for cost optimization at this stage is to leverage elastic services designed to grow or shrink according to demand, such as cloud and managed services. A modern product with a cloud-native architecture can auto-scale cloud consumption to mitigate lost operational demand. What may not have been obvious to startup leaders is a strategy often employed by incumbent, mature enterprises — achieving cost optimization by leveraging managed services providers (MSPs). MSPs enable organizations to repurpose full-time staff members from impacted operations to more strategic product lines or initiatives.

Why companies need cost optimization in the long run


By Walter Thompson

Zuora partners with Amazon Pay to expand subscription billing options

Zuora, the SaaS company helping organizations manage payments for subscription businesses, announced today that it had been selected as a Premier Partner in the Amazon Pay Global Partner Program. 

The “Premier Partner” distinction means businesses using Zuora’s billing platform can now easily integrate Amazon’s digital payment system as an option during checkout or recurring payment processes. 

The strategic rationale for Zuora is clear, as the partnership expands the company’s product offering to prospective and existing customers.  The ability to support a wide array of payment methodologies is a key value proposition for subscription businesses that enables them to service a larger customer base and provide a more seamless customer experience.

It also doesn’t hurt to have a deep-pocketed ally like Amazon in a fairly early-stage industry.  With omnipotent tech titans waging war over digital payment dominance, Amazon has reportedly doubled down on efforts to spread Amazon Pay usage, cutting into its own margins and offering incentives to retailers.

As adoption of Amazon Pay spreads, subscription businesses will be compelled to offer the service as an available payment option and Zuora should benefit from supporting early billing integration.

For Amazon Pay, teaming up with Zuora provides direct access to Zuora’s customer base, which caters to tens of millions of subscribers. 

With Zuora minimizing the complexity of adding additional payment options, which can often disrupt an otherwise unobtrusive subscription purchase experience, the partnership with Zuora should help spur Amazon Pay adoption and reduce potential friction.

“By extending the trust and convenience of the Amazon experience to Zuora, merchants around the world can now streamline the subscription checkout experience for their customers,” said Vice President of Amazon Pay, Patrick Gauthier.  “We are excited to be working with Zuora to accelerate the Amazon Pay integration process for their merchants and provide a fast, simple and secure payment solution that helps grow their business.”

The world subscribed

The collaboration with Amazon Pay represents another milestone for Zuora, which completed its IPO in April of this year and is now looking to further differentiate its offering from competing in-house systems or large incumbents in the Enterprise Resource Planning (ERP) space, such as Oracle or SAP.   

Going forward, Zuora hopes to play a central role in ushering a broader shift towards a subscription-based economy. 

Tien Tzuo, founder and CEO of Zuora, told TechCrunch he wants the company to help businesses first realize they should be in the subscription economy and then provide them with the resources necessary to flourish within it.

“Our vision is the world subscribed.”  said Tzuo. “We want to be the leading company that has the right technology platform to get companies to be successful in the subscription economy.”

The partnership will launch with publishers “The Seattle Times” and “The Telegraph”, with both now offering Amazon Pay as a payment method while running on the Zuora platform.


By Arman Tabatabai