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January 18, 2019
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Pro.com raises $33M for its home improvement platform

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Pro.com is basically a general contractor for the age of Uber and Prime Now. While the company started out as a marketplace for hiring home improvement professionals, it has now morphed into a general contractor and serves Denver, Phoenix San Francisco, San Jose and Seattle. Today, Pro.com announced that it has raised a $33 million Series B round led by WestRiver Group, Goldman Sach and Redfin. Previous investors DFJ, Madrona Venture Group, Maveron and Two Sigma Ventures also participated.

WestRiver founder Erik Anderson, Redfin CEO Glenn Kelman and former Microsoft exec Charlotte Guyman are joining the Pro.com board.

“Many of Redfin’s customers struggle to get professional renovation services, so we know firsthand that Pro.com’s market opportunity is massive,” writes Redfin’s Kelman. “Pro.com and Redfin share a commitment to combining technology and local, direct services to best take care of customers.”

The company tells me that the round caps off a successful 2018, where Pro.com saw its job bookings grow by 275 percent over 2017, a number that was also driven by its expansion beyond the Seattle market (as well as the good economic climate that surely helped in driving homeowners to tackle more home improvement projects). The company now has 125 employees.

With this funding round, Pro.com has now raised a total of $60 million. It’ll use the funding to enter more markets, with Portland, Oregon being next on the list, and expand its team as it goes along.

It’s no secret that the home improvement market could use a bit of a jolt. The market is extremely local and fragmented — and finding the right contractor for any major project is a long and difficult process, where the outcome is never quite guaranteed. The process has enough vagueries that many people never get around to actually commissioning their projects. Pro.com wants to change that with a focus on transparency and technology. That’s a startup that’s harder to scale than the marketplace the company started out with, but it also gives the company a chance to establish itself as one of the few well-known brands in this space.

News Source = techcrunch.com

Flutterwave and Visa launch African consumer payment service GetBarter

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Fintech startup Flutterwave has partnered with Visa to launch a consumer payment product for Africa called GetBarter.

The app based offering is aimed at facilitating personal and small merchant payments within countries and across Africa’s national borders. Existing Visa card holders can send and receive funds at home or internationally on GetBarter.

The product also lets non card-holders (those with accounts or mobile wallets on other platforms) create a virtual Visa card to link to the app.  A Visa spokesperson confirmed the product partnership.

GetBarter allows Flutterwave—which has scaled as a payment gateway for big companies through its Rave product—to pivot to African consumers and traders.

Rave is B2B, this is more B2B2C since we’re reaching the consumers of our customers,” Flutterwave CEO Olugbenga Agboola—aka GB—told TechCrunch.

The app also creates a network for clients on multiple financial platforms, such as Kenyan mobile money service M-Pesa, to make transfers across payment products, national borders, and to shop online.

“The target market is pretty much everyone who has a payment need in Africa. That includes the entire customer base of M-Pesa, the entire bank customer base in Nigeria, mobile money and bank customers in Ghana—pretty much the entire continent,” Agboola said.

Flutterwave and Visa will focus on building a GetBarter user base across mobile money and bank clients in Kenya, Ghana, and South Africa, with plans to grow across the continent and reach those off the financial grid.

“In phase one we’ll pursue those who are banked. In phase-two we’ll continue toward those who are unbanked who will be able to use agents to work with GetBarter,” Agboola said.

Flutterwave and Visa will generate revenue through fees from financial institutions on cards created and on fees per transaction. A GetBarter charge for a payment in Nigeria is roughly 40 Naira, or 11 cents, according to Agboola.

With this week’s launch users can download the app for Apple and Android devices and for use on WhatsApp and USSD.

Founded in 2016, Flutterwave has positioned itself as a global B2B payments solutions platform for companies in Africa to pay other companies on the continent and abroad. It allows clients to tap its APIs and work with Flutterwave developers to customize payments applications. Existing customers include Uber, Facebook, Booking.com, and African e-commerce unicorn Jumia.com.

Flutterwave has processed 100 million transactions worth $2.6 billion since inception, according to company data.

The company has raised $20 million from investors including Greycroft, Green Visor Capital, Mastercard, and Visa.

In 2018, Flutterwave was one of several African fintech companies to announce significant VC investment and cross-border expansion—see Paga, Yoco, Cellulant, Mines.ie, and  Jumo.

Flutterwave added operations in Uganda in June and raised a $10 million Series A round in October that saw former Visa CEO Joe Saunders join its board of directors.

The company also plugged into ledger activity in 2018, becoming a payment processing partner to the Ripple and Stellar blockchain networks.

Flutterwave hasn’t yet released revenue or profitability info, according to CEO Olugbenga Agboola.

Headquartered in San Francisco, with its largest operations center in Nigeria, the startup plans to add operations centers to South Africa and Cameroon, which will also become new markets for GetBarter.

News Source = techcrunch.com

Startups Weekly: Will Trump ruin the unicorn IPOs of our dreams?

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The government shutdown entered its 21st day on Friday, upping concerns of potentially long-lasting impacts on the U.S. stock market. Private market investors around the country applauded when Uber finally filed documents with the SEC to go public. Others were giddy to hear Lyft, Pinterest, Postmates and Slack (via a direct listing, according to the latest reports) were likely to IPO in 2019, too.

Unfortunately, floats that seemed imminent may not actually surface until the second half of 2019 — that is unless President Donald Trump and other political leaders are able to reach an agreement on the federal budget ASAP.  This week, we explored the government’s shutdown’s connection to tech IPOs, recounted the demise of a well-funded AR project and introduced readers to an AI-enabled self-checkout shopping cart.

1. Postmates gets pre-IPO cash

The company, an early entrant to the billion-dollar food delivery wars, raised what will likely be its last round of private capital. The $100 million cash infusion was led by BlackRock and valued Postmates at $1.85 billion, up from the $1.2 billion valuation it garnered with its unicorn round in 2018.

2. Uber’s IPO may not be as eye-popping as we expected

To be fair, I don’t think many of us really believed the ride-hailing giant could debut with a $120 billion initial market cap. And can speculate on Uber’s valuation for days (the latest reports estimate a $90 billion IPO), but ultimately Wall Street will determine just how high Uber will fly. For now, all we can do is sit and wait for the company to relinquish its S-1 to the masses.

3. Deal of the week

N26, a German fintech startup, raised $300 million in a round led by Insight Venture Partners at a $2.7 billion valuation. TechCrunch’s Romain Dillet spoke with co-founder and CEO Valentin Stalf about the company’s global investors, financials and what the future holds for N26.

4. On the market

Bird is in the process of raising an additional $300 million on a flat pre-money valuation of $2 billion. The e-scooter startup has already raised a ton of capital in a very short time and a fresh financing would come at a time when many investors are losing faith in scooter startups’ claims to be the solution to the problem of last-mile transportation, as companies in the space display poor unit economics, faulty batteries and a general air of undependability. Plus, Aurora, the developer of a full-stack self-driving software system for automobile manufacturers, is raising at least $500 million in equity funding at more than a $2 billion valuation in a round expected to be led by new investor Sequoia Capital.


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5. A unicorn’s deal downsizes

WeWork, a co-working giant backed with billions, had planned on securing a $16 billion investment from existing backer SoftBank . Well, that’s not exactly what happened. And, oh yeah, they rebranded.

6. A startup collapses

After 20 long years, augmented reality glasses pioneer ODG has been left with just a skeleton crew after acquisition deals from Facebook and Magic Leap fell through. Here’s a story of a startup with $58 million in venture capital backing that failed to deliver on its promises.

7. Data point

Seed activity for U.S. startups has declined for the fourth straight year, as median deal sizes increased at every stage of venture capital.

8. Meanwhile, in startup land…

This week edtech startup Emeritus, a U.S.-Indian company that partners with universities to offer digital courses, landed a $40 million Series C round led by Sequoia India. Badi, which uses an algorithm to help millennials find roommates, brought in a $30 million Series B led by Goodwater Capital. And Mr Jeff, an on-demand laundry service startup, bagged a $12 million Series A.

9. Finally, Meet Caper, the AI self-checkout shopping cart

The startup, which makes a shopping cart with a built-in barcode scanner and credit card swiper, has revealed a total of $3 million, including a $2.15 million seed round led by First Round Capital .

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News Source = techcrunch.com

BasisAI, a Singapore startup from Bay Area returnees, comes out of stealth with impressive creds

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An intriguing new startup is out from under the radar in Southeast Asia after BasisAI, a Singapore-based company, revealed itself this week. The startup disclosed a seed investment from two prestigious investors in the region and some impressive credentials to back it up.

Started by twin brothers Linus and Silvanus Lee and Liu Feng-Yuan — all Singapore nationals — the startup is, as the name suggests, focused on AI… but the exact scope of its business is not yet clear. In a phone interview with TechCrunch, the founders explained their goal is to work with enterprises to help scale data project and give artificial intelligence and machine learning increased accountability.

“We see a problem within a lot of enterprises with data, they are keen to scale and take their innovation and lab experiments into production and reality,” Silvanus Lee explained. “What we’re trying to tackle is to make AI scalable and accountable.”

That, Lee continued, is important for reasons include refining results produced by AI systems, explaining how AI products work to stakeholders and users, as well as of course allowing companies to operate systems at large scale. The initial focus is Singapore, a prime location for enterprises and corporates in Southeast Asia, the founders added.

That’s about all we know about the business so far, despite coming out of stealth mode a lot of information is being kept private, including the exact size of the team under wraps — we are assured, though, that it’s “lean.” The startup did confirm, however, that it raised a $6 million seed round from marquee investors Temasek, the Singapore sovereign fund, and Sequoia India, the branch of the U.S. firm that handles deals in India and Southeast Asia.

Lee said they spoke to a range of investors and chose these two for the strategic value they bring to the table, particularly in Singapore.

Those are indeed impressive backers — Temasek, in particular, isn’t known for doing seed stage investments — and that is likely down to the caliber of the founding team as much as their (mysterious) vision.

The Lee brothers are both Singaporeans returning home from Silicon Valley, where they worked with major tech firms. Silvanus spent 15 years in the Bay Area with Dropbox and then Uber, where he was a director of data science, and Linus spent six years at Twitter in California before relocating to Singapore in 2016 to lead the social media firm’s data science team in Asia Pacific.

Matched with those tenures at top tech firms, meanwhile, is Liu, who has spent significant time working within the Singapore government. That has included stints with the Land Transport Authority (LTA) and on the Ministry of Trade’s Advisory team before nearly five years with GovTech Singapore, an agency under the Prime Minister’s office.

BasisAI founders [left to right] Silvanus Lee, Liu Feng-Yuan and Linus Lee

It’s the kind of ‘dream ticket’ that you’d imagine Singapore has dreamed of: two students which cut their teeth in Silicon Valley matched with another who has been part of the country’s digital push. (And, hey, twins, too!)

Still, it remains to be seen exactly what the company will bring to market.

Silvanus told TechCrunch that BasisAI is a product-driven company — as opposed to an agency-like outfit that advises enterprises — and he revealed that it has customers piloting deployments and software right now.

“Now it feels like the right time to come back and see if we can contribute to the tech ecosystem,” he said. “There’s a lot of world-class talent here, more so than ever before, and we feel like the time is right now to build a really high caliber tech and engineering company.”

“We really want to help grow the ecosystem in Singapore,” Lee added.

News Source = techcrunch.com

Uber’s IPO may not be as eye-popping as we expected

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Uber is expected to raise $10 billion later this year in one of the largest U.S. initial public offerings in history. The float will value the ride-hailing giant somewhere between $76 billion — the valuation it garnered with its last private financing — and $120 billion — a sky-high figure assigned by Wall Street bankers that’s had even early Uber investors scratching their heads.

A new report from The Information pegs Uber’s initial market cap at $90 billion. To develop the estimate, the site analyzed undisclosed documents Uber provided creditors in 2017 “in which the company projected it would double net revenue to $14.2 billion by 2019,” ran revenue multiples and compared Uber to GrubHub, which investors say is the business’s closest comparison.

Uber declined to comment on The Information’s analysis.

How we got here

Uber confidentially filed for its long-awaited IPO last month, marking the beginning of a race to the stock markets between it and U.S. competitor Lyft, which filed just hours before, according to a source with knowledge of the situation. Founded in 2009 by Travis Kalanick, Uber has brought in about $20 billion in a combination of debt and equity funding. It counts SoftBank as its largest shareholder in a cap table that also lists Toyota, T. Rowe Price, Fidelity, TPG Growth and many more. As for the skepticism surrounding Uber’s lofty $120 billion valuation, the eye-popping figure seems unachievable considering the company isn’t profitable and has and continues to burn through cash.

An IPO that large would certainly make its investors happy. First Round Capital, for example, seeded Uber with $1.6 million in the company’s first two funding rounds in 2010 and 2011, according to The Wall Street Journal. At a $120 billion valuation, First Round’s shares would be worth some $5 billion. The venture capital firm, however, sold some of its shares to SoftBank alongside Benchmark, which itself would otherwise own shares worth about $14 billion.

Bradley Tusk, an early Uber investor who signed on to help the company surmount political and regulatory barriers in 2011, own shares said to be worth $100 million, though he too gave up 42 percent of his equity in a secondary sale to SoftBank, he recently told TechCrunch.

I’m quite happy with the 120 number,” Tusk said. “But … I am a little surprised by [it], it does seem to be a really aggressive number.”

“Any investment in Uber is obviously a long-term bet on the future, like someone who invested in Amazon in the early days,” Tusk added. “One thing [Uber chief executive officer Dara Khosrowshahi] is doing well is really expanding Uber into a mobility company as opposed to just a ride-hailing company.”

Dara Kowsrowshahi, chief executive officer of Uber, looks on following an event in New Delhi, India, on Thursday, Feb. 22, 2018. Photographer: Anindito Mukherjee/Bloomberg via Getty Images

A long-term bet on the future

Uber has opted to go public in a year poised to see the most high-flying unicorn IPOs in history. As we’ve reported in great detail on this site, both Lyft and Uber are planning to float, as are Slack and Pinterest . Many of these companies, however, made the call to make their public markets debut before the stock market took a quick turn south. Poor performing stocks may discourage unicorns from emerging from their cozy VC-protected stalls.

Uber will garner increased scrutiny from Wall Street investors as they begin to parse out its true value. Fortunately the company, which like Amazon has long prioritized growth over profit, has “’clear levers’ it could pull in order to turn on the cash spigots if it wanted to, by reducing its marketing spending both in the U.S. and developing markets and by finding partners to help finance its self-driving car development,” according to The Information. “Pulling those levers would slow revenue growth by a third—from a 33% growth in net revenue to 22 percent growth in net revenue in 2019 [but] it would save Uber $2 billion annually.”

In its third quarter 2018 financial results, Uber posted a net loss of $939 million on a pro forma basis and an adjusted EBITDA loss of $527 million, up about 21 percent quarter-over-quarter. Revenue for Q3 was up five percent QoQ at $2.95 billion and up 38 percent year-over-year.

“We had another strong quarter for a business of our size and global scope,” Uber chief financial officer Nelson Chai said in a statement. “As we look ahead to an IPO and beyond, we are investing in future growth across our platform, including in food, freight, electric bikes and scooters, and high-potential markets in India and the Middle East where we continue to solidify our leadership position.”

We can speculate on Uber’s valuation for days but ultimately Wall Street will determine just how high Uber will go. For now, all we can do is sit and wait for the company to relinquish its S-1 to the masses.

News Source = techcrunch.com

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