All posts by Richy George

Our 3 favorite startups from Morgan Stanley’s 2nd Multicultural Innovation Lab Demo Day 

Posted by on 20 November, 2018

This post was originally published on this site

The Morgan Stanley Multicultural Innovation LabMorgan Stanley’s in-house accelerator focused on companies founded by multicultural and female entrepreneurs, hosted its second Annual Showcase and Demo Day.  The event also featured companies from accelerators HearstLab, Newark Venture Partner Labs and PS27 Ventures.  (Note: I was formerly employed by Morgan Stanley and have no financial ties.)

The showcase represented the culmination of the program’s second year, which followed an initial five company class that has already seen two acquisitions.  Through the six-month program, Morgan Stanley provides early-stage companies with a wide range of benefits including an equity investment from Morgan Stanley, office space at Morgan Stanley headquarters, access to Morgan Stanley’s extensive network, and others.  Applications are now open for its third cohort of companies with the application window closing on January 4th, 2019.

The 16 presenting startups, all led by a female or multicultural founder, offered solutions to structural inefficiencies across a wide array of categories including fintech, developer tools, and health.  Though all of the companies offered impressive presentations and strong value propositions, here are three of the companies that stood out to us.

Hatch Apps

In hopes of democratizing software and app development, Hatch Apps provides a platform that allows users and companies to build iOS, Android and web applications without any code through pre-built templates and custom plug-and-play functions.  In essence, Hatch Apps provides a solution for application building similar to what Squarespace or Wix provide for websites.

In the modern economy, every company is in one way or another a tech or tech-enabled company.  Now the demand for strong engineers has made the fight for talent increasingly competitive and has made engineering quite costly, even when only needed for simple tasks. 

For an implementation and subscription fee, Hatch Apps allows companies with less sophisticated engineering DNA to reduce entering costs by launch native apps on their own, across platforms, and often on faster timelines than those seen through third-party developers.  Once an app is launched, Hatch Apps provides customers with detailed analytics and allows them to send targeted push notifications, export data and make in-app changes that can automatically go live in app stores.

The company initially took a bootstrapping approach to financing and raised funds by selling a 2016 election-themed “Cards Against Humanity”-style game created on the platform.  Since then, Hatch Apps has already received funding from the Y Combinator Fellowship, Morgan Stanley, and a number of other investors.

FreeWill

While estate planning is a topic many don’t like to think about, it’s a critical issue for managing cross-generational wealth. But will drafting can often be very complex, time-consuming, and costly, requiring hours of legal consultation and coordination between various parties.

Founded by two former classmates at Stanford Business School, FreeWill looks to simplify the estate planning process by providing a free online platform that automates will drafting, in a similar function to what TurboTax does for taxes.  Using FreeWill, users can quickly set allocations for their estate and select personal recipients, charitable donations, executor specifications, and other ancillary requests.  The platform then creates a finalized legal document that is legally valid in all 50 states, which users can also quickly make changes to and replace without incurring expensive legal costs.

FreeWill is able to provide the platform to consumers for free due to the proceeds it receives from its non-profit customers, who pay to be featured on the platform as a partner organization.  FreeWill offers a compelling value proposition for partnering companies.  By acting as a channel to funnel user donations to listed organizations, FreeWill has been able to drive a 600% increase in charitable giving to partner organizations on average.  FreeWill also provides partner organizations with backing analytics that allow non-profits to track bequests and donors through monthly reports. 

FreeWill currently boasts an impressive roster of 75 paying non-profit partners that include American Red Cross, Amnesty International and many others.  In the long-run hopes to be the go-to solution financial and legal end of life planning for investment advisors, life insurance and employee benefits providers.

Shoobs

Shoobs is looking to be the go-to platform for local “urban” events, which the company defined as events centered on local nightlife, comedy and concerts in the hip-hop, R&B, and reggae genres to name a few.  But unlike the genre-agnostic, transaction-focused event management platforms that can make the space seem pretty crowded, Shoobs focused on providing genre-specific even discovery.  Shoobs matches urban event goers with artists of their choice and related smaller scale events that can be harder to discover, acting as a form of curation, quality control and discovery.

For event organizers, Shoobs helps provide digital ticketing and promotion services, with event recommendation capabilities that target the most promising potential customers.  Through its offering to event organizers, Shoobs is able to monetize its services through ticket sale commission, advertising and brand partnerships.

Since its initial launch in London, Shoobs notes it has become one of the top urban events platforms in the city, with an extensive base of recurring registered users and event organizers.  After previously working with AEG for its London launch, Shoobs is looking to expand stateside with the help of organizers like Live Nation.  Shoobs joins a long list of promising Y Combinator alumni companies with YC also acting as one of Shows initial investors

Other presenting companies included:

Morgan Stanley Multicultural Innovation Lab

  • BeautyLynk “is an on-demand hair and makeup service provider, specializing in customizable services for women.”
  • Broadway Roulette “is an events marketplace that pairs consumers with surprise cultural events, beginning with Broadway theater.”
  • CariClub “is an enterprise software platform to connect young professionals with nonprofit opportunities.”
  • COI Energy Services “is an integrated platform for electric utilities and business users to optimize and manage energy usage.”
  • CoSign “is an API and application that allows anyone to create, distribute and monetize visual content.”
  • Goalsetter “is a goals-based gifting, savings, and investing platform designed for children.”
  • myLAB Box “offers customizable at home health-test kits and relevant telemedicine consultations / prescription services.”

Hearst Labs

  • Priori “is a global legal marketplace changing the way in-house teams find, hire, and manage outside counsel.”
  • TRENCH “is an online fashion marketplace that makes use of the unworn items in every woman’s closet.”

Newark Venture Partners Labs

  • Floss Bar “is a new type of preventive brand for oral health care. The company offers high-quality, routine dental care across flexible locations at thoughtful prices.”
  • Upsider “is a software solution allowing recruiters to leverage AI technology to identify a comprehensive set of candidates who align with their business and role requirements, resulting in a more strategic understanding of the best possible talent for the job.”

PS27 Ventures

  • BlueWave Technologies “is a cleantech company and the creators of the BlueWave™ Cleaning System — a water free, detergent free, and chemical free plasma device that cleans items that are extremely hard or impossible to clean with a washer and dryer.”
  • OnPay Solutions “focuses exclusively on business-to-business payments. They create payment software and offer payment web services to enhance efficiency and productivity for Accounts Payable and Accounts Receivable.”

Posted Under: Tech News
Autodesk agrees to buy PlanGrid for $875 million

Posted by on 20 November, 2018

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Autodesk announced plans to acquire PlanGrid, a San Francisco startup that helped move blueprints from paper to the iPad when it launched in 2011.

This digitization of construction fits with Autodesk’s vision of digitizing design in general, and CEO Andrew Anagnost certainly recognized the transformational potential of the company he was buying. “There is a huge opportunity to streamline all aspects of construction through digitization and automation. The acquisition of PlanGrid will accelerate our efforts to improve construction workflows for every stakeholder in the construction process,” he said in a statement.

The company, which is a 2012 graduate of Y Combinator, raised just $69 million, so this appears to be a healthy exit for the them. PlanGrid took what was a paper-intensive task and shifted it to digital, taking a world of hand-written mark-ups and sticky notes onto the fledgling iPad.

In an interview with CEO and co-founder Tracy Young in 2015 at TechCrunch Disrupt in San Francisco, she said the industry was ripe for change. “The heart of construction is just a lot of construction blueprints information. It’s all tracked on paper right now and they’re constantly, constantly changing,” Young said at the time.

Those manual changes often resulted in errors she said, and that was costly for the contractors. As an engineer working for a construction company, who was at one time responsible for making the paper copies, she recognized that the process could be improved by moving it into the digital realm.

PlanGrid CEO Tracy Young onstage at TechCrunch Disrupt San Francisco in 2015

Her idea, which was kind of radical in 2011 when she started the company, was to move all that paper to the cloud and display it on an iPad. It’s important to remember that the enterprise was not rushing to the cloud in 2011, and most people considered the iPad at the time to be a consumer device, so what she and her co-founders were attempting was a true kind of industry transformation.

Young sees joining Autodesk as a way to continue building on that early vision. “PlanGrid has excelled at building beautiful, simple field collaboration software, while Autodesk has focused on connecting design to construction. Together, we can drive greater productivity and predictability on the jobsite,” she said in a statement.

PlanGrid currently has 400 employees, 12,000 customers and 120,000 paid users, and has been used on over a million construction projects worldwide, according to data provided by the companies. They believe that under Autodesk’s umbrella and combined with their existing product set, they can provide a complete construction solution and grow the business faster than PlanGrid could have on its own — pretty much the standard argument in an acquisition like this.

PlanGrid was efficient with the money it took. In fact the last raise was $40 million almost exactly three years ago. The deal is expected to close at the end of January pending the normal regulatory approval process.

 

Posted Under: Tech News
LinkedIn launches its own Snapchat Stories: ‘Student Voices’

Posted by on 20 November, 2018

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The social media singularity continues with the arrival of Snapchat Stories-style slideshows on LinkedIn as the app grasps for relevance with a younger audience. LinkedIn confirms to TechCrunch that it plans to build Stories for more sets of users, but first it’s launching “Student Voices” just for university students in the U.S. The feature appears atop the LinkedIn home screen and lets students post short videos to their Campus Playlist. The videos (no photos allowed) disappear from the playlist after a week while staying permanently visible on a user’s own profile in the Recent Activity section. Students can tap through their school’s own slideshow and watch the Campus Playlists of nearby universities.

LinkedIn now confirms the feature is in testing, with product manager Isha Patel telling TechCrunch “Campus playlists are a new video feature that we’re currently rolling out to college students in the US. As we know, students love to use video to capture moments so we’ve created this new product to help them connect with one another around shared experiences on campus to help create a sense of community.” Student Voices was first spotted by social consultant Carlos Gil, and tipped by Socially Contented’s Cathy Wassell to Matt Navarra.

A LinkedIn spokesperson tells us the motive behind the feature is to get students sharing their academic experiences like internships, career fairs and class projects that they’d want to show off to recruiters as part of their personal brand. “It’s a great way for students to build out their profile and have this authentic content that shows who they are and what their academic and professional experiences have been. Having these videos live on their profile can help students grow their network, prepare for life after graduation, and help potential employers learn more about them,” Patel says.

But unfortunately that ignores the fact that Stories were originally invented for broadcasting off-the-cuff moments that disappear so you DON’T have to worry about their impact on your reputation. That dissonance might confuse users, discourage them from posting to Student Voices or lead them to assume their clips will disappear from their profile too — which could leave embarrassing content exposed to hirers. “Authenticity” might not necessarily paint users in the best light to recruiters, so it seems more likely that students would post polished clips promoting their achievements… if they use it at all.

LinkedIn seems to be desperate to appeal to the next generation. Social app investigator and TechCrunch’s favorite tipster Jane Manchun Wong today spotted 10 minor new features LinkedIn is prototyping that include youth-centric options like GIF comments, location sharing in messages and Facebook Reactions-style buttons beyond “Like” such as “Clap,” “Insightful,” “Hmm,” and “Support.”

When users post to Student Stories, they’ll have their university’s logo overlaid as a sticker they can move around. LinkedIn will generate this plus a set of suggested hashtags like #OnCampus based on a user’s profile, including which school they say they attend, though users can also overlay their own text captions. Typically, users in the test phase were sharing videos of around 30 to 45 seconds. “Students are taking us to their school hackathons, showing us their group projects, sharing their student group activities and teaching us about causes they care about,” Patel explains. You can see an example video here, and watch a sizzle reel about the feature below.

For now, LinkedIn tells me it has no plans to insert ads between clips in Student Voices. But if the Stories content assists with discovering and vetting job candidates, it could make LinkedIn more unique and indispensable to recruiters who do pay for premium access. And if these Stories get a ton of views simply by being emblazoned atop the LinkedIn feed, users might return to the app more frequently to share them. As we’ve seen with the steady increase in popularity of Facebook Stories, if you give people a stage for narcissism, they will fill it.

LinkedIn’s start as a dry web tool for seeking jobs has made for a rocky transition as it tries to become a daily habit for users. Some tactical advice in its feed can be helpful, but much of LinkedIn’s content feels blatantly self-promotional, boring or transactional. Meanwhile, it’s encountering new competition as Facebook integrates career listings and job applications for blue-collar work into its social network that already sees over a billion people visit each day. It’s understandable why LinkedIn would try to latch on to the visual communication trend, as Facebook estimates Stories sharing will surpass feed sharing across all apps in 2019. But Student Voices nonetheless feels unabashedly “how do you do, fellow kids?”

Posted Under: Tech News
Microsoft acquires FSLogix to enhance Office 365 virtual desktop experience

Posted by on 19 November, 2018

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Back in September, Microsoft announced a virtual desktop solution that lets customers run Office 365 and Windows 10 in the cloud. They mentioned several partners in the announcement who were working on solutions with them. One of those was FSLogix, a Georgia virtual desktop startup. Today, Microsoft announced it has acquired FSLogix. It did not share the purchase price.

“FSLogix is a next-generation app-provisioning platform that reduces the resources, time and labor required to support virtualization,” Brad Anderson, corporate VP for Microsoft Office 365 and Julia White, corporate VP for Microsoft Azure wrote in a joint blog post today.

When Microsoft made the virtual desktop announcement in September they named Citrix, CloudJumper, Lakeside Software, Liquidware, People Tech Group, ThinPrint and FSLogix as partners working on solutions. Apparently, the company decided it wanted to own one of those experiences and acquired FSLogix.

Microsoft believes by incorporating the FSLogix solution, it will provide a better virtual desktop experience for its customer by enabling better performance and faster load times, especially for Office 365 ProPlus customers.

Randy Cook, founder and CTO at FSLogix, said the acquisition made sense given how well the two companies have worked together over the years. “From the beginning, in working closely with several teams at Microsoft, we recognized that our missions were completely aligned. Both FSLogix and Microsoft are dedicated to providing the absolute best experience for companies choosing to deploy virtual desktops,” Cook wrote in a blog post announcing the acquisition.

Lots of companies have what are essentially dumb terminals running just the tools each employee needs, rather than a fully functioning stand-alone PC. Citrix has made a living offering these services. When employees comes in to start the day, they sign in with their credentials and they get a virtual desktop with the tools they need to do their jobs. Microsoft’s version of this involves Office 365 and Windows 10 running on Azure.

FSLogix was founded in 2013 and has raised over $10 million, according to data on Crunchbase. Today’s acquisition, which has already closed according to Microsoft, comes on the heels of last week’s announcement that the company was buying Xoxco, an Austin-based developer shop with experience building conversational bots.

Posted Under: Tech News
Google looks to former Oracle exec Thomas Kurian to move cloud business along

Posted by on 18 November, 2018

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Diane Greene announced on Friday that she was stepping down after three years running Google’s cloud business. She will stay on until the first of the year to help her successor, Thomas Kurian in the transition. He left Oracle at the end of September after more than 20 years with the company, and is charged with making Google’s cloud division more enterprise-friendly, a goal that has oddly eluded the company.

Greene was brought on board in 2015 to bring some order and enterprise savvy to the company’s cloud business. While she did help move them along that path, and grew the cloud business, it simply hasn’t been enough. There have been rumblings for months that Greene’s time was coming to an end.

So the torch is being passed to Kurian, a man who spent over two decades at a company that might be the exact opposite of Google. He ran product at Oracle, a traditional enterprise software company. Oracle itself has struggled to make the transition to a cloud company, but Bloomberg reported in September that one of the reasons Kurian was taking a leave of absence at the time was a difference of opinion with Chairman Larry Ellison over cloud strategy. According to the report, Kurian wanted to make Oracle’s software available on public clouds like AWS and Azure (and Google Cloud). Ellison apparently didn’t agree and a couple of weeks later Kurian announced he was moving on.

Even though Kurian’s background might not seem to be perfectly aligned with Google, it’s important to keep in mind that his thinking was evolving. He was also in charge of thousands of products and helped champion Oracle’s move to the cloud. He has experience successfully nurturing products enterprises have wanted, and perhaps that’s the kind of knowledge Google was looking for in its next cloud leader.

Ray Wang, founder and principal analyst at Constellation Research says Google still needs to learn to support the enterprise, and he believes Kurian is the right person to help the company get there. “Kurian knows what’s required to make a cloud company work for enterprise customers,” Wang said.

If he’s right, perhaps an old-school enterprise executive is just what Google requires to turn its Cloud division into an enterprise-friendly powerhouse. Greene has always maintained that it was still early days for the cloud and Google had plenty of time to capture part of the untapped market, a point she reiterated in her blog post on Friday. “The cloud space is early and there is an enormous opportunity ahead,” she wrote.

She may be right about that, but marketshare positions seem to be hardening. AWS, which was first to market, has an enormous marketshare lead with over 30 percent by most accounts. Microsoft is the only company with the market strength at the moment to give them a run for their money and the only other company with double digit market share numbers. In fact, Amazon has a larger marketshare than the next four companies combined, according to data from Synergy Research.

While Google is always mentioned in the Big 3 cloud companies with AWS and Microsoft, with around $4 billion revenue a year, it has a long way to go to get to the level of these other companies. Despite Greene’s assertions, time could be running out to make a run. Perhaps Kurian is the person to push the company to grab some of that untapped market as companies move more workloads to the cloud. At this point, Google is counting on him to do just that.

Posted Under: Tech News
Former Oracle Exec Thomas Kurian to replace Diane Greene as head of Google Cloud

Posted by on 16 November, 2018

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Diane Greene announced in a blog post today that she would be stepping down as CEO of Google Cloud and will be helping transition former Oracle executive Thomas Kurian to take over early next year.

Greene took over the position almost exactly three years ago when Google bought Bebop, the startup she was running. The thinking at the time was that the company needed someone with a strong enterprise background and Greene, who helped launch VMware, certainly had the enterprise credentials they were looking for.

In the blog post announcing the transition, she trumpeted her accomplishments. “The Google Cloud team has accomplished amazing things over the last three years, and I’m proud to have been a part of this transformative work. We have moved Google Cloud from having only two significant customers and a collection of startups to having major Fortune 1000 enterprises betting their future on Google Cloud, something we should accept as a great compliment as well as a huge responsibility,” she wrote.

The company had a disparate set of cloud services when she took over, and one of the first things Greene did was to put them all under a single Google Cloud umbrella. “We’ve built a strong business together — set up by integrating sales, marketing, Google Cloud Platform (GCP), and Google Apps/G Suite into what is now called Google Cloud,” she wrote in the blog post.

As for Kurian, he stepped down as president of product development at Oracle at the end of September. He had announced a leave of absence earlier in the month before making the exit permanent.  Like Greene before him, he brings a level of enterprise street cred, which the company needs as it continues to try and grow its cloud business.

After three years with Greene at the helm, Google, which has tried to position itself as the more open cloud alternative to Microsoft and Amazon, has still struggled to gain market share against its competitors, remaining under 10 percent consistently throughout Greene’s tenure.

As Synergy’s John Dinsdale told TechCrunch in an article on Google Cloud’s strategy in 2017, the company had not been particularly strong in the enterprise to that point. “The issues of course are around it being late to market and the perception that Google isn’t strong in the enterprise. Until recently Google never gave the impression (through words or deeds) that cloud services were really important to it. It is now trying to make up for lost ground, but AWS and Microsoft are streets ahead,” Dinsdale explained at the time. Greene was trying hard to change that perception.

Google has not released many revenue numbers related to the cloud, but in February it indicated they were earning a billion a quarter, a number that Greene felt the $4 billion run rate put Google in elite company. Amazon and Google were reporting numbers like that for a quarter at the time. Google stopped reporting cloud revenue after that report.

Regardless, the company will turn to Kurian to continue growing those numbers now. “I will continue as CEO through January, working with Thomas to ensure a smooth transition. I will remain a Director on the Alphabet board,” Greene wrote in her blog post.

Interesting enough Oracle has struggled with its own transition to the cloud. Kurian gets a company that was born in the cloud, rather than one that has made a transition from on-prem software and hardware to one solely in the cloud. It will be up to him to steer Google Cloud moving forward.

Posted Under: Tech News
Uber joins Linux Foundation, cementing commitment to open-source tools

Posted by on 15 November, 2018

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Uber announced today at the 2018 Uber Open Summit that it was joining the Linux Foundation as a Gold Member, making a firm commitment to using and contributing to open-source tools.

Uber CTO Thuan Pham sees the Linux Foundation as a place for companies like his to nurture and develop open-source projects. “Open source technology is the backbone of many of Uber’s core services and as we continue to mature, these solutions will become ever more important,” he said in a blog post announcing the partnership.

What’s surprising is not that they joined, but that it took so long. Uber has been long known for making use of open source in its core tools, working on over 320 open-source projects and repositories from 1,500 contributors involving over 70,000 commits, according to data provided by the company.

“Uber has made significant investments in shared software development and community collaboration through open source over the years, including contributing the popular open-source project Jaeger, a distributed tracing system, to the Linux Foundation’s Cloud Native Computing Foundation in 2017,” an Uber spokesperson told TechCrunch.

Linux Foundation Executive Director Jim Zemlin was certainly happy to welcome Uber into the fold. “Their expertise will be instrumental for our projects as we continue to advance open solutions for cloud native technologies, deep learning, data visualization and other technologies that are critical to businesses today,” Zemlin said in a statement.

The Linux Foundation is an umbrella group supporting myriad open-source projects and providing an organizational structure for companies like Uber to contribute and maintain open-source projects. It houses sub-organizations like the Cloud Native Computing Foundation, Cloud Foundry Foundation, The Hyperledger Foundation and the Linux operating system, among others.

These open-source projects provide a base on top of which contributing companies and the community of developers can add value if they wish and build a business. Others like Uber, which uses these technologies to fuel their backend systems, won’t sell additional services, but can capitalize on the openness to help fuel their own requirements in the future, while also acting as a contributor to give as well as take.

Posted Under: Tech News
Citrix pays $200M to acquire Sapho, which connects legacy software with ‘micro apps’

Posted by on 15 November, 2018

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As large organizations grapple with adopting modern work practices without throwing out all of their legacy software, a company that works with them is making an acquisition that it hopes will help with that process. Citrix today is announcing that it has acquired Sapho, a startup that develops “micro apps” for legacy software so that workers could use then as they would more modern applications: in the cloud, on mobile and more.

We understand that the acquisition was for around $200 million in an all-cash deal. It’s a good return: Sapho had raised just under $28 million since 2014 from investors that included AME Cloud Ventures, Louie Alsop, Felicis Ventures and more. Including co-founders Fouad ElNaggar and Peter Yared, the whole team of 90 employees, based mainly in the Bay Area and a development office in Prague, will be joining Citrix.

Citrix, for its part, currently has a market cap of about $14 billion and has been seeing a surge of interest under new CEO David Henshall, who has repositioned it from focusing mainly on virtual private networking services to a more hybrid cloud model, following a wider trend in the world of enterprise IT.

Citrix will be bringing on all of Sapho’s existing business and products. The two companies already have a strong overlap in their customer bases, CEO ElNaggar said, and it was in fact several of those customers asking for more integrations with Citrix services that drove Citrix approaching Sapho for this deal.

“The largest companies in the world are using Citrix and have a massive hybrid environment where they need to provide a more engaging set of experiences for their employees,” Tim Minahan, EVP Business Strategy and CMO of Citrix, said in an interview. “It doesn’t mean they will rip everything out and put in new software, and Sappho provides a great way to leverage that infrastructure and make them more insightful in their decision making. We see it as a way to rethink the role that enterprise apps play in their environment.”

Typical tasks that Sapho today provides integrations for by tapping into legacy software include expense reporting, sales software, IT support tickets and HR tasks. It feeds data from these into services like Microsoft Teams, Microsoft Dynamics, Oracle’s EBS, Salesforce and SAP ERP, Workday, Google Drive and more.

Ahead of Citrix buying Sapho we’d heard that IBM and Microsoft had eyed up the company and entered into early talks, underscoring the work Sapho had done, the deals it was winning, and the gap in the market that it was filling.

 

Posted Under: Tech News
Canonical plans to raise its first outside funding as it looks to a future IPO

Posted by on 15 November, 2018

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It’s been 14 years since Mark Shuttleworth first founded and funded Canonical and the Ubuntu project. At the time, it was mostly a Linux distribution. Today, it’s a major enterprise player that offers a variety of products and services. Throughout the years, Shuttleworth self-funded the project and never showed much interest in taking outside money. Now, however, that’s changing.

As Shuttleworth told me, he’s now looking for investors as he looks to get the company on track to an IPO. It’s no secret that the company’s recent re-focusing on the enterprise — and shutting down projects like the Ubuntu phone and the Unity desktop environment — was all about that, after all. Shuttleworth sees raising money as a step in this direction — and as a way of getting the company in shape for going public.

“The first step would be private equity,” he told me. “And really, that’s because having outside investors with outside members of the board essentially starts to get you to have to report and be part of that program. I’ve got a set of things that I think we need to get right. That’s what we’re working towards now. Then there’s a set of things that private investors are looking for and the next set of things is when you’re doing a public offering, there’s a different level of discipline required.”

It’s no secret that Shuttleworth, who sports an impressive beard these days, was previously resistant to this, and he acknowledged as much. “I think that’s a fair characterization,” he said. “I enjoy my independence and I enjoy being able to make long-term calls. I still feel like I’ll have the ability to do that, but I do appreciate keenly the responsibility of taking other people’s money. When it’s your money, it’s slightly different.”

Refocusing Canonical on the enterprise business seems to be paying off already. “The numbers are looking good. The business is looking healthy. It’s not a charity. It’s not philanthropy,” he said. “There are some key metrics that I’m watching, which are the gate for me to take the next step, which would be growth equity.” Those metrics, he told me, are the size of the business and how diversified it is.

Shuttleworth likens this program of getting the company ready to IPO to getting fit. “There’s no point in saying: I haven’t done any exercise in the last 10 years but I’m going to sign up for tomorrow’s marathon,” he said.

The move from being a private company to taking outside investment and going public — especially after all these years of being self-funded — is treacherous, though, and Shuttleworth admitted as much, especially in terms of being forced to setting short-term goals to satisfy investors that aren’t necessarily in the best interest of the company in the long term. Shuttleworth thinks he can negotiate those issues, though.

Interestingly, he thinks the real danger is quite a different one. “I think the most dangerous thing in making that shift is the kind of shallowness of the unreasonably big impact that stock price has on people’s mood,” he said. “Today, at Canonical, it’s 600 people. You might have some that are having a really great day and some that are having a shitty day. And they have to figure out what’s real about both of those scenarios. But they can kind of support each other. […] But when you have a stock ticker, everybody thinks they’re having a great day, or everybody thinks they’re having a shitty day in a way that may be completely uncorrelated to how well they’re actually doing.”

Shuttleworth does not believe that IBM’s acquisition of its competitor Red Hat will have any immediate effect on its business, though. What he does think, however, is that this move is making a lot of people rethink for the first time in years the investment they’ve been making in Red Hat and its enterprise Linux distribution. Canonical’s promise is that Ubuntu, as well as its OpenStack tools and services, are not just competitive but also more cost-effective in the long run, and offer enterprises an added degree of agility. And if more businesses start looking at Canonical and Ubuntu, that can only speed up Shuttleworth’s (and his bankers’) schedule for hitting Canonical’s metrics for raising money and going public.

Posted Under: Tech News
RPA startup Automation Anywhere nabs $300M from SoftBank at a $2.6B valuation

Posted by on 15 November, 2018

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The market for RPA — Robotic Process Automation — is getting a hat trick of news this week: Automation Anywhere has today announced that it has raised $300 million from the SoftBank Vision Fund. This funding, which values Automation Anywhere at $2.6 billion post-money, is an extension to the Series A the company announced earlier this year, which was at a $1.8 billion valuation. It brings the total size of the round to $550 million.

The news comes just a day after one of the startup’s bigger competitors, UiPath, announced a $265 million raise at a $3 billion valuation; and a week after Kofax, another competitor, announced it would be acquiring a division of Nuance for $400 million to beef up its business.

It’s also yet one more example of a one-two punch in funding. It was only in July that Automation Anywhere announced its $250 million raise.

This latest round adds some significant investors to the company’s cap table, specifically from the SoftBank Vision Fund, which counts a number of tech giants like Apple and Qualcomm as LPs, along with others. Specifically, the fund has been under fire for the last few weeks because of the fact that a large swathe of its backing comes from Saudi money.

The Saudi Arabian government has been in the spotlight over its involvement in the killing of journalist Jamal Khashoggi in its embassy in Turkey. By extension of that, there have been many questions raised in recent weeks over the ethics of taking money from the Vision Fund, with so many questions still in the air over that affair.

In an interview, Mihir Shukla, CEO and Co-Founder at Automation Anywhere, said that while what happened to Khashoggi was “not acceptable,” his conversations started with SoftBank before that and they did not impact the startup’s decision over whether to work with the Fund.

He declined to comment on the timing of the term sheet getting signed, when asked whether it was before or after the news broke of the murder.

What attracted us to SoftBank was that Masayoshi Son” — the CEO and founder of SoftBank — “has a vision and he is investing in foundational platforms that will change how we work and travel,” Shukla said. “We share that vision.”

He also pointed out that getting funding from SoftBank will “naturally” lead to more opportunities to partner with companies in SoftBank’s network of companies, which cover dozens of investments and outright ownerships.

While it feels like artificial intelligence is something that you see referenced at every turn these days in the tech world, RPA is an interesting area because it’s one of the more tangible applications of it, across a wide set of businesses.

In short, it’s a set of software-based “robots” that help companies automate mundane and repetitive tasks that would otherwise be done by human workers, employing AI-based technology in areas like computer vision and machine learning to get the work done.

Competition among companies to grab pole position in the space is fierce. Automation Anywhere has 1,400 organizations as customers, it says. By comparison, UiPath has 2,100 and claims an annual revenue run rate at the moment of $150 million. Shukla declined to disclose any financials for his company.

But in light of all that, the company will be using the funding to build out its business specifically ahead of rivals.

“With this additional capital, we are in a position to do far more than any other provider,” said Shukla in a statement. “We will not only continue to deliver the most advanced RPA to the market, but we will help bring AI to millions. Like the introduction of the PC, we see a world where every office employee will work alongside digital workers, amplifying human contributions. Today, employees must know how to use a PC and very soon employees will have to know how to build a bot.”

Automation Anywhere claims that its Bot Store is the industry’s largest marketplace for bot applications, designed both by itself and partners, to execute different business processes, with 65,000 users since launching in March 2018.

Posted Under: Tech News
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