Twitter taps AWS for its latest foray into the public cloud

Posted by on 15 December, 2020

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Twitter has a lot going on, and it’s not always easy to manage that kind of scale on your own. Today, Amazon announced that Twitter has signed a multi-year agreement with AWS to run its real-time timelines. It’s a major win for Amazon’s cloud arm.

While the companies have worked together in some capacity for over a decade, this marks the first time that Twitter is tapping AWS to help run its core timelines.

“This expansion onto AWS marks the first time that Twitter is leveraging the public cloud to scale their real-time service. Twitter will rely on the breadth and depth of AWS, including capabilities in compute, containers, storage and security, to reliably deliver the real-time service with the lowest latency, while continuing to develop and deploy new features to improve how people use Twitter,” the company explained in the announcement.

Parag Agrawal, chief technology officer at Twitter, sees this as a way to expand and improve the company’s real-time offerings by taking advantage of AWS’s network of data centers to deliver content closer to the user. “The collaboration with AWS will improve performance for people who use Twitter by enabling us to serve Tweets from data centers closer to our customers at the same time as we leverage the Arm-based architecture of AWS Graviton2 instances. In addition to helping us scale our infrastructure, this work with AWS enables us to ship features faster as we apply AWS’s diverse and growing portfolio of services,” Agrawal said in a statement.

It’s worth noting that Twitter also has a relationship with Google Cloud. In 2018, it announced it was moving its Hadoop clusters to GCP.

This announcement could be considered a case of the rich getting richer as AWS is the leader in the cloud infrastructure market by far, with around 33% market share. Microsoft is in second with around 18% and Google is in third with 9%, according to Synergy Research. In its most recent earnings report, Amazon reported $11.6 billion in AWS revenue, putting it on a run rate of over $46 billion.

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Parsec raises $25M from a16z to power remote work and cloud gaming

Posted by on 15 December, 2020

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Parsec, a startup that’s built streaming technology for both work and play, is announcing that it has raised $25 million in Series B funding.

This brings Parsec’s total funding to $33 million, according to Crunchbase. The round was led by Andreessen Horowitz, with the firm’s general partner Martin Casado joining the board. Previous investors Lerer Hippeau, Makers Fund, NextView Ventures and Notation Capital also participated.

CEO Benjy Boxer told me that since he and CTO Chris Dickson founded the company in 2016, the vision has always been “to make it easier for people to connect to their technology, software and content from anywhere, on any device.”

They started out by helping gamers access their gaming PCs from other devices (the Parsec app is currently available for Windows, Mac, Linux, Android, Raspberry Pi and the web).

“From the beginning, we thought that if we could build something that is great for gaming, it will be great for everything,” Boxer said.

But it was a natural transition to other use cases, since some of the people using Parsec to play games in their free time also turned out to work at TV production companies, video game companies or in other jobs where they need access to high-end workstations. That’s why the company launched Parsec for Teams this year, which offers the same low-latency remote experience, while also adding features like encryption, group permissions and collaboration on the same file.

Image Credits: Parsec

“The performance of Parsec is just way above everything else,” Boxer said. “People forget they’re using Parsec.”

Parsec works with major gaming clients like EA, Ubisoft, Blizzard Entertainment and Square Enix, and it’s also being used in industries like architecture, engineering and video broadcast/production/post-production.

And as you might imagine, the need for something like this has only increased during the pandemic. Boxer said customers have found that the platform is saving their employees more than an hour a day by eliminating the commute and giving them high-speed access to their workstations — rather than, say, having to wait an hour for a 100 gigabyte file to download.

And most of those clients anticipate that after the pandemic, their employees will continue for work from home for part of the time.

“So in that scenario, people are bringing their computers back to the office, and they can use Parsec to make sure it’s always accessible to them,” Boxer said.

On the consumer side, he said that where usage was previously heaviest during the weekends, during the pandemic “there’s no spike anymore on the weekends, people are playing all the time.”

Boxer added that the company will continue developing the core platform, leading to improvements for both gaming and enterprise users, while there’s a separate team focused on building administrative and collaborative features.

 

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Tive nabs $12M Series A to track shipment conditions in real time

Posted by on 15 December, 2020

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Tive, a Boston-based startup, is building a hardware and software platform to help track the conditions of a shipment like say food or medicine to make sure it is stored under the proper conditions as it moves from farm or factory to market. Today, the company announced a $12 million Series A.

RRE Ventures led the round with help from new investor Two Sigma Ventures and existing investors NextView Ventures, Hyperplane Ventures, One Way Ventures, Fathom Ventures and other unnamed individuals. The company has now raised close to $17 million, according to Crunchbase data.

Tive helps companies all over the world track their shipments in a very specific way,” company co-founder and CEO Krenar Komoni told me. Using a tracking device the company created, customers can press a button, place the tracker on a palette or in a container, and it begins transmitting shipment data like temperature, shock, light exposure, humidity and location data in real time to ensure that the shipment is moving safely to market under proper conditions.

He said that they are the first company to create single-use 5G trackers, meaning the shipping company doesn’t have to worry about managing, maintaining, recharging or returning them (although they encourage that by giving a discount for future orders on returned items).

Tive hardware tracker and data tracking software. Image Credit: Tive

The approach seems to be working. Komoni reports that revenue has grown 570% in 2020 as the product-market fit has become more acute with digitization hitting the supply chain in a big way. He says that in particular customers and investors like the company’s full-stack approach.

“What’s interesting […] and why we are resonating with customers and also why investors like it, is because we’re providing the full stack, meaning the hardware, the software, the platform and the APIs to major transportation management systems,” Komoni explained.

The company has 22 employees and expects to double that number in 2021. As he grows the company, Komoni says that as an immigrant founder, he’s particularly sensitive to diversity and inclusion.

“I’m an immigrant myself. I grew up in Kosovo, came to the U.S. when I was 17 years old, went to high school here in Vermont. I’m a U.S. citizen, but part of who I am is being open to different cultures and different nationalities. It’s just part of my nature,” he says.

The company was founded in 2015 and its facilities are in Boston. It has continued shipping devices throughout the pandemic, and that has meant figuring out how to operate in a safe way with some employees in the building. He expects the company will have more employees operating out of the office as we move past the pandemic. He also has an engineering operation in Kosovo.

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5 questions every IT team should be able to answer

Posted by on 14 December, 2020

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Now more than ever, IT teams play a vital role in keeping their businesses running smoothly and securely. With all of the assets and data that are now broadly distributed, a CEO depends on their IT team to ensure employees remain connected and productive and that sensitive data remains protected.

CEOs often visualize and measure things in terms of dollars and cents, and in the face of continuing uncertainty, IT — along with most other parts of the business — is facing intense scrutiny and tightening of budgets. So, it is more important than ever to be able to demonstrate that they’ve made sound technology investments and have the agility needed to operate successfully in the face of continued uncertainty.

For a CEO to properly understand risk exposure and make the right investments, IT departments have to be able to confidently communicate what types of data are on any given device at any given time.

Here are five questions that IT teams should be ready to answer when their CEO comes calling:

What have we spent our money on?

Or, more specifically, exactly how many assets do we have? And, do we know where they are? While these seem like basic questions, they can be shockingly difficult to answer … much more difficult than people realize. The last several months in the wake of the COVID-19 outbreak have been the proof point.

With the mass exodus of machines leaving the building and disconnecting from the corporate network, many IT leaders found themselves guessing just how many devices had been released into the wild and gone home with employees.

One CIO we spoke to estimated they had “somewhere between 30,000 and 50,000 devices” that went home with employees, meaning there could have been up to 20,000 that were completely unaccounted for. The complexity was further compounded as old devices were pulled out of desk drawers and storage closets to get something into the hands of employees who were not equipped to work remotely. Companies had endpoints connecting to corporate network and systems that they hadn’t seen for years — meaning they were out-of-date from a security perspective as well.

This level of uncertainty is obviously unsustainable and introduces a tremendous amount of security risk. Every endpoint that goes unaccounted for not only means wasted spend but also increased vulnerability, greater potential for breach or compliance violation, and more. In order to mitigate these risks, there needs to be a permanent connection to every device that can tell you exactly how many assets you have deployed at any given time — whether they are in the building or out in the wild.

Are our devices and data protected?

Device and data security go hand in hand; without the ability to see every device that is deployed across an organization, it becomes next to impossible to know what data is living on those devices. When employees know they are leaving the building and going to be off network, they tend to engage in “data hoarding.”

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iCIMS acquires video recruiting startup Altru for $60M

Posted by on 14 December, 2020

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Enterprise recruiting company iCIMS is announcing that it has acquired Altru.

ICIMS declined to comment on the terms of the deal, but a source with knowledge of the companies told us that the price is a combination of cash and stock, totaling around $60 million.

Founded in 2000, iCIMS offers a “talent cloud” used by more than 4,000 employers to attract, engage and hire new employees, and to help existing employees continue to develop their careers.

Former Marketo chief executive Steve Lucas became CEO in February, and he told me that the recruiting world is overdue for reinvention. After all, every company says they want to hire the most talented people around, so he wondered, “Well, okay, if you want that, why do you create such boring content? Why do you take a job that is exciting and should demand amazing human beings and create this super boring job description?”

Lucas sees video as a key piece of the solution, allowing companies to bring more “authenticity” to what can be a stuffy and bureaucratic process. Just over a month ago, iCIMS announced another acquisition in this area — Paris-based Easyrecrue.

Lucas said that while Easyrecrue has created tools to enrich video interviews, Altru can be most helpful earlier in the recruiting process, when companies are trying to stay connected with the most promising candidates and get them excited about a potential job.

Altru CEO Alykhan Rehmatullah (who founded the startup with CTO Vincent Polidoro — they’re both pictured above) told me that while the company started out with a focus on recording and sharing employee videos for recruitment, its asynchronous videos are becoming used more broadly across companies. He suggested that’s particularly true this year, while teams are working from home and everyone’s looking for ways to communicate that are more expressive than Slack and don’t require putting “another 30-minute Zoom call on your calendar.”

In fact, Lucas said that before talking to me, he’d actually been recording videos on Altru to explain the acquisition to his own team. He praised the platform’s ease of use, joking, “If I can use this thing, anybody can use it.”

Rehmatullah said the entire Altru team will be joining iCIMS, where he’ll become vice president of content strategy. The goal is to continue operating Altru as a standalone product while also finding new ways to integrate it into the iCIMS platform.

Altru previously raised a total of $1.3 million from Birchmere Ventures, Active Capital and Techstars.

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Vista acquires IT education platform Pluralsight for $3.5B

Posted by on 14 December, 2020

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The hectic M&A cycle we have seen throughout 2020 continued this weekend when Vista Equity Partners announced it was acquiring Pluralsight for $3.5 billion.

That comes out to $20.26 per share. The company stock closed on Friday at $18.50 per share on a market cap of over $2.7 billion.

With Pluralsight, Vista gets an online training company that helps educate IT professionals, including developers, operations, data and security, with a suite of online courses. As the pandemic has taken hold, it has breathed new life into edtech, but even before that, there was a market for upskilling IT Pros online.

This trend certainly didn’t escape Monti Saroya, co-head of the Vista Flagship Fund and senior managing director at Vista. “We have seen firsthand that the demand for skilled software engineers continues to outstrip supply, and we expect this trend to persist as we move into a hybrid online-offline world across all industries and interactions, with business leaders recognizing that technological innovation is critical to business success,” he said in a statement.

As is typical for acquired companies, Pluralsight CEO Aaron Skonnard sees this as a way to grow the company more quickly. “The global Vista ecosystem of leading enterprise software companies provides significant resources and institutional knowledge that will open doors and help fuel our growth. We’re thrilled that we will be able to leverage Vista’s expertise to further strengthen our market leading position,” Skonnard said in a statement.

In a 2017 interview with TechCrunch’s Sarah Buhr, Skonnard described the company as an enterprise SaaS learning platform. It goes beyond simply offering the courses by giving professionals in a given category such as developer or IT operations the ability to measure their skills and abilities against other pros in that category. He saw this assessment capability as a big differentiator.

“Our platform is ultimately focused on closing the technology skills gap throughout the world,” Skonnard told Buhr.

Pluralsight, which was founded in 2004, raised more than $190 million before going public in 2018. The company has 1,700 employees and more than 17,000 customers. The acquisition is subject to standard regulatory oversight, but is expected to close in the first half of next year. Once that happens, the company will go private once again.

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German Bionic raises $20M led by Samsung for exoskeleton tech to supercharge human labor

Posted by on 14 December, 2020

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Exoskeleton technology has been one of the more interesting developments in the world of robotics: Instead of building machines that replace humans altogether, build hardware that humans can wear to supercharge their abilities. Today, German Bionic, one of the startups designing exoskeletons specifically aimed at industrial and physical applications — it describes its Cray X robot as “the world’s first connected exoskeleton for industrial use,” that is, to help people lifting and working with heavy objects, providing more power, precision and safety — is announcing a funding round that underscores the opportunity ahead.

The Augsburg, Germany-based company has raised $20 million, funding that it plans to use to continue building out its business, as well as its technology, both in terms of the hardware and the cloud-based software platform, German Bionic IO, that works with the exoskeletons to optimize them and help them “learn” to work better.

The Cray X currently can compensate up to 30 kg for each lifting movement, the company says.

“With our groundbreaking robotic technology that combines human work with the industrial Internet of Things (IIoT), we literally strengthen the shop floor workers’ backs in an immediate and sustainable way. Measurable data underscores that this ultimately increases productivity and the efficiency of the work done,” says Armin G. Schmidt, CEO of German Bionic, in a statement. “The market for smart human-machine systems is huge and we are now perfectly positioned to take a major share and substantially improve numerous working lives.”

The Series A is being co-led by Samsung Catalyst Fund, a strategic investment arm from the hardware giant, and German investor MIG AG, one of the original backers of BioNtech, the breakthrough company that’s developed the first COVID-19 vaccine to be rolled out globally.

Storm Ventures, Benhamou Global Ventures (founded and led by Eric Benhamou, who was the founding CEO of Palm and before that the CEO of 3com) and IT Farm also participated. Previously, German Bionic had only raised $3.5 million in seed funding (with IT Farm, Atlantic Labs and individual investors participating).

German Bionic’s rise comes at an interesting moment in terms of how automation and cloud technology are sweeping the world of work. When people talk about the next generation of industrial work, the focus is usually on more automation and the rise of robots to replace humans in different stages of production.

But at the same time, some robotics technologists have worked on another idea. Because we’re probably still a long way away from being able to make robots that are just like humans, but better in terms of cognition and all movements, instead, create hardware that doesn’t replace, but augments, live laborers, to help make them stronger while still being able to retain the reliable and fine-tuned expertise of those humans.

The argument for more automation in industrial settings has taken on a more pointed urgency in recent times, with the rise of the COVID-19 health pandemic: Factories have been one of the focus points for outbreaks, and the tendency has been to reduce physical contact and proximity to reduce the spread of the virus.

Exoskeletons don’t really address that aspect of COVID-19 — even if you might require less of them as a result of using exoskeletons, you still require humans to wear them, after all — but the general focus that automation has had has brought more attention to the opportunity of using them.

And in any case, even putting the pandemic to one side, we are still a long way away from cost-effective robots that completely replace humans in all situations. So, as we roll out vaccinations and develop a better understanding of how the virus operates, this still means a strong market for the exoskeleton concept, which analysts (quoted by German Bionic) predict could be worth as much as $20 billion by 2030.

In that context, it’s interesting to consider Samsung as an investor: The company itself, as one of the world’s leading consumer electronics and industrial electronics providers, is a manufacturing powerhouse in its own right. But it also makes equipment for others to use in their industrial work, both as a direct brand and through subsidiaries like Harman. It’s not clear which of these use cases interests Samsung: whether to use the Cray X in its own manufacturing and logistics work, or whether to become a strategic partner in manufacturing these for others. It could easily be both.

“We are pleased to support German Bionic in its continued development of world-leading exoskeleton technology,” says Young Sohn, corporate president and chief strategy officer for Samsung Electronics and chairman of the board, Harman, in a statement. “Exoskeleton technologies have great promise in enhancing human’s health, wellbeing and productivity. We believe that it can be a transformative technology with mass market potential.”

German Bionic describes its Cray X as a “self-learning power suit” aimed primarily at reinforcing lifting movements and to safeguard the wearer from making bad calls that could cause injuries. That could apply both to those in factories, or those in warehouses, or even sole trader mechanics working in your local garage. The company is not disclosing a list of customers, except to note that it includes, in the words of a spokesperson, “a big logistics player, industrial producers and infrastructure hubs.” One of these, the Stuttgart Airport, is highlighted on its site.  

“Previously, efficiency gains and health promotion in manual labor were often at odds with one another. German Bionic Systems managed to not only break through this paradigm, but also to make manual labor a part of the digital transformation and elegantly integrate it into the smart factory,” says Michael Motschmann, managing partner with MIG in a statement. “We see immense potential with the company and are particularly happy to be working together with a first-class team of experienced entrepreneurs and engineers.”

Exoskeletons as a concept have been around for over a decade already — MIT developed its first exoskeleton, aimed to help soldiers carrying heavy loads — back in 2007, but advancements in cloud computing, smaller processors for the hardware itself and artificial intelligence have really opened up the idea of where and how these might augment humans. In addition to industry, some of the other applications have included helping people with knee injuries (or looking to avoid knee injuries!) ski better, and for medical purposes, although the recent pandemic has put a strain on some of these use cases, leading to indefinite pauses in production.

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Turing nabs $32M more for an AI-based platform to source and manage engineers remotely

Posted by on 10 December, 2020

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As remote work continues to solidify its place as a critical aspect of how businesses exist these days, a startup that has built a platform to help companies source and bring on one specific category of remote employees, engineers, is taking on some more funding to meet demand.

Turing — which has built an AI-based platform to help evaluate prospective, but far-flung, engineers, bring them together into remote teams, and then manage them for the company — has picked up $32 million in a Series B round of funding led by WestBridge Capital. Its plan is as ambitious as the world it is addressing is wide: an AI platform to help define the future of how companies source IT talent to grow.

“They have a ton of experience in investing in global IT services, companies like Cognizant and GlobalLogic,” said co-founder and CEO Jonathan Siddharth of its lead investor in an interview the other day. “We see Turing as the next iteration of that model. Once software ate the IT services industry, what would Accenture look like?”

It currently has a database of some 180,000 engineers covering around 100 or so engineering skills including React, Node, Python, Agular, Swift, Android, Java, Rails, Golang, PHP, Vue, devops, machine learning, data engineering and more.

In addition to WestBridge, other investors in this round included Foundation Capital, Altair Capital, Mindset Ventures, Frontier Ventures, and Gaingels. There is also a very long list of high profile angels participating, underscoring the network that the founders themselves have amassed. It includes unnamed executives from Google, Facebook, Amazon, Twitter, Microsoft, Snap, and other companies as well as Adam D’Angelo (Facebook’s first CTO and CEO at Quora), Gokul Rajaram, Cyan Banister and Scott Banister, Beerud Sheth (the founder of Upwork), among many others (I’ll run the full list below).

Turing is not disclosing its valuation. But as a measure of its momentum, it was only in August that the company raised a seed round of $14 million, led by Foundation. Siddharth said that the growth has been strong enough in the interim that the valuations it was getting and the level of interest compelled the company to skip A altogether and go straight for its Series B.

The company now has 180,000 developers signed up from across 10,000 cities to its platform (compared to 150,000 back in August). Some 50,000 of them have gone through automated vetting on the Turing platform, and the task will now be to bring on more companies to tap into that trove of talent.

Or, “We are demand-constrained,” which is how Siddharth describes it. At the same time, it’s been growing revenues and growing its customer base, jumping from revenues of $9.5 million in October to $12 million in November, increasing 17x since first becoming generally available 14 months ago. Current customers include VillageMD, Plume, Lambda School, Ohi Tech, Proxy, and Carta Healthcare.

Remote work=immediate opportunity

A lot of people talk about remote work today in the context of people no longer able to go into their offices as part of the effort to curtail the spread of Covid-19. But in reality another form of it has been in existence for decades.

Offshoring and outsourcing by way of help from third parties — such as Accenture and other systems integrators  — are two ways that companies have been scaling and operating, paying sums to those third parties to run certain functions or build out specific areas instead of shouldering the operating costs of employing, upsizing and sometimes downsizing that labor force itself.

Turing is essentially tapping into both concepts. On one hand, it has built a new way to source and run teams of people, specifically engineers, on behalf of others. On the other, it’s using the opportunity that has presented itself in the last year, to open up the minds of engineering managers and others to consider the idea of bringing on people they might have previously insisted work in their offices, to now work for them remotely, and still be effective.

Siddarth, who co-founded the company with Vijay Krishnan (who is the CTO) know the other side of the coin all too well. They are both from India, and both relocated to the Valley first for school (post-graduate degrees at Stanford) and then work at a time when moving to the Valley was effectively the only option for ambitious people like them to get employed by in large, global tech companies, or build startups, effectively what could become large, global tech companies.

“Talent is universal, but opportunities are not,” Siddarth said to me earlier this year when describing the state of the situation.

A previous startup co-founded by the pair — content discovery app Rover — highlighted to them a gap in the market. They built the startup around a remote and distributed team of engineers, which helped them keep costs down while still recruiting top talent. Meanwhile, rivals were building teams in the Valley. “All our competitors in Palo Alto and the wider area were burning through tons of cash, and it’s only worse now. Salaries have skyrocketed,” he said.

After Rover was acquired by Revcontent, a recommendation platform that competes against the likes of Taboola and Outbrain, they decided to turn their attention to seeing if they could build a startup based on how they had, basically, built their own previous startup.

There are a number of companies that have been tapping into the different aspects of the remote work opportunity, as it pertains to sourcing talent and how to manage it.

They include the likes of Remote (raised $35 million in November), Deel ($30 million raised in September), Papaya Global ($40 million also in September), Lattice ($45 million in July), and Factorial ($16 million in April), among others.

What’s interesting about Turing is how it’s trying to address and provide services for the different stages you go through when finding new talent. It starts with an AI platform to source and vet candidates. That then moves into matching people with opportunities, and onboarding those engineers. Then, Turing helps manage their work and productivity in a secure fashion, and also provides guidance on the best way to manage that worker in the most compliant way, be it as a contractor or potentially as a full-time remote employee.

The company is not freemium as such but gives people two weeks to trial people before committing to a project. So unlike an Accenture, Turing itself tries to build in some elasticity into its own product, not unlike the kind of elasticity that it promises its customers.

It all sounds like a great idea now, but interestingly, it was only after remote work really became the norm around March/April of this year that the idea really started to pick up traction.

“It’s amazing what Covid has done. It’s led to a huge boom for Turing,” said Sumir Chadha, MD for WestBridge Capital, in an interview. For those who are building out tech teams, he added, there is now “No need for to find engineers and match them with customers. All of that is done in the cloud.”

“Turing has a very interesting business model which today is especially relevant,” said Igor Ryabenkiy, Managing Partner at Altair Capital, in a statement. “Access to the best talent worldwide and keeping it well-managed and cost-effective make the offering attractive for many corporations. The energy of the founding team provides fast growth for the company, which will be even more accelerated after the B-round.”

PS. I said I’d list the full, longer list of investors in this round. In these Covid times, this is likely the biggest kind of party you’ll see for a while. In addition to those listed above, it included [deep breath] Founders Fund, Chapter One Ventures (Jeff Morris Jr), Plug and Play Tech Ventures (Saeed Amidi), UpHonest Capital (​Wei Guo, Ellen Ma​), Ideas & Capital (Xavier Ponce de León), 500 Startups Vietnam (Binh Tran and Eddie Thai), Canvas Ventures (Gary Little), B Capital (Karen Appleton P​age, Kabir Narang), Peak State Ventures (​Bryan Ciambella, Seva Zakharov)​, Stanford StartX Fund, Amino C​apital, ​Spike Ventures, Visary Capital (Faizan Khan), Brainstorm Ventures (Ariel Jaduszliwer), Dmitry Chernyak, Lorenzo Thione, Shariq Rizvi, Siqi Chen, Yi Ding, Sunil Rajaraman, Parakram Khandpur, Kintan Brahmbhatt, Cameron Drummond, Kevin Moore, Sundeep Ahuja, Auren Hoffman, Greg Back, Sean Foote, Kelly Graziadei, Bobby Balachandran, Ajith Samuel, Aakash Dhuna, Adam Canady, Steffen Nauman, Sybille Nauman, Eric Cohen, Vlad V, Marat Kichikov, Piyush Prahladka, Manas Joglekar, Vladimir Khristenko, Tim and Melinda Thompson, Alexandr Katalov, Joseph and Lea Anne Ng, Jed Ng, Eric Bunting, Rafael Carmona, Jorge Carmona, Viacheslav Turpanov, James Borow, Ray Carroll, Suzanne Fletcher, Denis Beloglazov, Tigran Nazaretian, Andrew Kamotskiy, Ilya Poz, Natalia Shkirtil, Ludmila Khrapchenko, Ustavshchikov Sergey, Maxim Matcin, and Peggy Ferrell.

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Fairmarkit lands $30M Series B to modernize procurement

Posted by on 10 December, 2020

This post was originally published on this site

As the pandemic has raged on, it has shined a spotlight on the importance of procurement, especially in certain sectors. Fairmarkit, a Boston startup, is working to bring a modern digital procurement system to the enterprise. Today, the company announced a $30 million Series B.

GGV Capital and Insight Partners led the round with help from existing investors 1984 VC, NewStack and NewFund. Today’s investment brings the total raised to $42 million, according to the company.

Fairmarkit wants to replace large procurement software systems from companies like Oracle and SAP that have been around for decades, says company co-founder and CEO Kevin Frechette. When he looked around a couple of years ago, he saw a space fully of these legacy vendors and ripe for disruption.

What’s more, he says that these systems have been designed to track only the biggest purchases over $500,000 or $1 million. Anything under that is what’s known as tail spend. “So procurement really focuses on companies’ biggest purchases, say things over a million, but anything under that size just gets forgotten about and neglected. It’s called tail spend, and it’s still 80% of what they buy, 80% of their vendors and 20% of the budget,” he told me.

This spending accounts for billions of dollars, yet Frechette says, it has lacked a good tracking system. He saw an opportunity, and he and his co-founders built a solution. Its first customer was the MBTA, Boston’s mass transit system (a system that could use all the help it can get in terms getting more efficient). Today the company has more than 50 customers across a variety of industries.

The system acts as a marketplace for vendors and a central buying system for customers where they can find goods and services at this price point below $1 million. It imports a customer’s vendor data, and then combines this with other data to build a huge database of buying information. From that, they can determine what a customer needs and using AI, find the best prices for a particular order.

Frechette says this not only provides a way to save money — he says customers have been able to cut purchase costs by 10% with his system — it also provides a way to surface diverse vendors, whether that’s businesses owned by women, people of color, veterans, local business or however you define that.

He says too often what happens is that these deals aren’t put under typical procurement department scrutiny and they just get passed through, but Fairmarkit helps surface these companies and give them a shot at the business. “So because the core of our technology is a vendor recommendation engine […], we can help to invite those diverse vendors and really just give them a fair shot,” he said.

The company started the year with 40 employees and have added 30 since. The plan is to double that number next year, and as they do, they want to reflect the diversity they are able to surface in the service in the company’s employees.

“It’s really just keeping it at the forefront. We want to make sure that we’re not just doing surveys around how we are doing for diversity and inclusion, but we’re putting programs in place to help out with it. It’s something I’m very very passionate about because it’s been such a sticking point as well on how we’re helping diverse vendors,” he said.

Frechette says that he has managed to grow the company and build a culture in spite of the pandemic not allowing employees to come into an office. He doesn’t see a world where the office will be a requirement in the future.

“We’ve hit an inflection point this year where there’s no world where we need everyone to be in an office […], which once again only helps to accelerate our business because we’re not constricted by everyone in this one small [geographical] sector. We can operate across the board [from anywhere],” he said.

Posted Under: Tech News
UserLeap raises $16 million to bring better qualitative data to PMs

Posted by on 10 December, 2020

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Product managers can only be successful if they can make effective use of both quantitative and qualitative data. But mapping the former to the latter, and collecting high-quality data, is a huge challenge to organizations looking to rapidly productize and innovate.

UserLeap, a company founded by serial product manager Ryan Glasgow, thinks it has found a better way, and so do its investors. The company today announced the close of a $16 million Series A financing led by Accel (Dan Levine led the round), with participation from angels like Elad Gil, Dylan Field, Ben Porterfield, Akshay Kothari, Jack Altman, and Bobby Lo.

One of the main challenges of rapid product development is that the ratio of quantitative data to qualitative data isn’t equal. It can take weeks or even months to get results from user surveys, and that’s only if users actually respond. According to UserLeap, the average response rate for email surveys is between 3 percent and 5 percent. To add to the headache, PMs and data teams usually have to parse that information and organize it manually.

UserLeap offers product teams the ability to put a short line of code into their product that then delivers contextual micro-surveys to users right within the product. The company says that these micro-surveys usually see a 20 percent to 30 percent response rate, and sometimes that even pops all the way to 90 percent.

Plus, the UserLeap dashboard processes the natural language from respondents and organizes the data. For example, if one user references price and another references cost, those responses are grouped together.

Because the surveys are built right into the product and targeted to a specific action or flow, and because the data is parsed and automatically sorted, product teams usually have access to this data within a few hours.

UserLeap charges based on the number of end users tracked, plus the number of surveys sent out per month, offering tiers for those surveys in groupings of five. Glasgow says this is a bit of a differentiator when compared to other survey products like SurveyMonkey or TypeForm.

“We have a usage based pricing model, where our competitors often have a seat based pricing model,” said Glasgow. “We don’t care how many people have access to us. Really, our goal is to get you to use our product.”

In other words, the insights gleaned from UserLeap can be shared and used across the entire organization without affecting the price.

This latest funding brings UserLeap’s total funding to $20 million — First Round Capital previously led a $4 million seed round.

Customers include Square, Opendoor, And Codecademy. Thus far, the company has tracked more than 500 million visitors, and gotten 600,000 survey question responses.

The UserLeap team is currently made up of 15 people, with females representing 50 percent and people of color making up 33 percent of the leadership team. Across the company, women represent 32 percent of the team are people of color represent 42 percent.

“UserLeap cares deeply about diversity and inclusion,” said Glasgow. “Having a diverse team helps to ensure our employees feel comfortable and valued so that they can bring their whole selves to work. For that reason, UserLeap has a part-time recruiting sourcer dedicated to engaging underrepresented candidates and these efforts have contributed towards our diversity goals.”

Posted Under: Tech News
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