Tag: accelerator

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The Mint, started by Better Tomorrow Ventures, wants to be the accelerator fintech needs

Better Tomorrow Ventures’ Sheel Mohnot landed some of his biggest wins before he ever started a venture firm. The investor previously worked as a partner at 500, previously known as 500 Startups, where he raised and ran a dedicated fintech fund as well as helped build an accelerator.

There he met his eventual founding partner at BTV – Jake Gibson – and backed a cadre of fintech startups, including Chipper and Albert, each at $2.5 million valuations. Today, Chipper is valued at over $1 billion, and Albert has raised over $175 million.

And while the firm has certainly cashed in on that early track record – raising a $225 million second fund last year – the duo behind it thinks it’s time to launch a nod toward their roots. Better Tomorrow Ventures tells TechCrunch that it is launching a fintech accelerator, this time under its own roof, called The Mint.

The Mint will be a three-month accelerator, based out of San Francisco, that cuts $500,000 checks in exchange for 10% equity in between six to ten startups. The initial cohort, which starts this upcoming August, already accepted one company, and sent a second acceptance letter out today.

“It’s something we’ve done successfully before. Our returns were crazy, crazy good from that initial fintech cohort, so I think if we can get anywhere near that again, our LPs will be happy,” Mohnot said.

The accelerator offers some standard support: a speaker series that includes founders from Mercury, Flexport and NerdWallet, office hours with experts, wellness resources, hiring support and desk space. Unlike some Zoom accelerator programs, The Mint is long San Francisco: two team members are moving to the city to help with logistics, and Better Tomorrow is leasing a new office space, outside of its Mission HQ, dedicated to the accelerator.

Better Tomorrow seems to be stepping in where it believes Y Combinator is lacking. “YC is built for scale. The advice is a lot like one size fits all,” Mohnot said. “We felt like with fintech, there are so many things that are unique about building that it makes sense to have something distinct.”

Among some seed stage investors, YC’s new standard deal has been met with varying degrees of weariness. Last year, YC announced that it would still offer its original deal – a $125,000 check in exchange for 7/% equity – as well as a $375,000 check at an uncapped SAFE note with a most favored nation (MFN) clause. The latter has stirred up some controversy: an MFN means that YC will get to invest $375,000 at the same terms as the investor who has the best terms in the next round. Now, YC companies are less incentivized to raise a small amount of money from angels, and more incentivized to optimize for higher valuations after Demo Day, so dilution is limited when accepting that $375,000 check.

“We think the MFN clause [that YC currently offers] can do companies a disservice. Because they end up almost having to raise at a very high valuation…you’re seeing that bite them in the ass a little bit. Because as if they don’t hit the metrics, the next round is even more challenging,” Mohnot said. While BTV’s 10% ownership is higher than other VC-spun out programs – take NextView’s $200,000 in exchange for 8% stake for an example – it’s less than what BTV usually targets for first checks, which is between 15% to 20% ownership.

Mohnot says that BTV will continue investing outside of the accelerator, but the big focus for the rest of the year in terms of net new investments will be within the program.

“I think there’s a TechCrunch article right now about fintech” pessimism, Mohnot said. “We are still really excited about the future of fintech and we liked fintech before it was cool.. At a fundamental level, financial services are 20% of GDP, and they are inherently digital, so the numbers make sense.”

We’re close to peak pessimism around fintech

The Mint, started by Better Tomorrow Ventures, wants to be the accelerator fintech needs by Natasha Mascarenhas originally published on TechCrunch

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mHub opens much bigger facility to kick Chicago startups into high gear

When mHub opened its doors in Chicago seven years ago, the vision was to create a traditional incubator for people making things. It would involve a prototyping lab, offices, shared workspaces, meeting rooms and classrooms. In those seven years, the accelerator says it has supported more than 500 startups, 200 manufacturers, been awarded around 450 patents, and helped to create roughly 4,000 jobs. Now, it is moving into a newly acquired, freshly refurbished space in a Chicago opportunity zone to help it incubate, accelerate and support more startups that can have a positive impact on humanity. TechCrunch spoke to mHub’s CEO and co-founder Haven Allen to find out what’s next for mHub, and what makes Chicago its perfect home.

“It’s been quite a journey over the last six years; we’ve definitely evolved beyond just the incubator,” said Allen. “Today, we have over 250 startups. But we also have manufacturers and groups like Keurig here, inventing the next Keurig machine out of our facilities. It’s both a lot of very early-stage, but some established ones that are looking for that sort of place where they can come test and build on the newest, latest equipment, connect with investors and connect with talent to scale up product sales.”

From mHub’s perspective, it had very much outgrown its current space, and its new center offers the startups and innovators and developers what they need, in the perfect geographical location.

“We wanted to be in an opportunity zone so that we could leverage that designation to attract and bring more venture capital to the table,” said Allen. “We wanted to be in one of the plant manufacturing districts and have access to public transit. And this just hits the Venn diagram perfectly right.”

The new center on Chicago’s Near Westside at 240 N. Ashland has been built-out to provide mHub with the facilities that it needs to support the development it wants to foster.

“We’ll build out more labs around energy technologies and specific testing equipment, electronics equipment and new wet labs, more battery related technologies,” said Allen. “In our current space, we don’t have really private offices beyond some of our industry partners that are embedded here. So we can support some of these growing teams as they need more space as they build their teams and inventory.”

mHub members working in the accelerator's current electronics lab

mHub members working in the accelerator’s current electronics lab. Image Credits: mHub

In addition to the physical facilities that mHub provides, it also brings together people to help cultivate innovation and connection.

“We have 600 engineers here, which is an incredibly valuable resource for the startups in the manufacturing community,” said Allen. “So there’s a lot of contracting and collaboration that we facilitate between the startups as well as outsourcing to industry for short-term R&D projects.”

As for Chicago itself, its combination of universities, diversified manufacturing economy, existing supply chain and easy access across the country makes it geographically ideal for an incubator like mHub and the startups it wants to attract.

“We’re looking for products and founders that are trying to create things that we believe can impact humanity,” said Allen. “We really lean in on climate, energy, med devices and sustainable manufacturing, knowing that we obviously have climate issues. And there’s lots of ways that we’re going to solve it. Human behavior doesn’t appear to be the one way, so how can technology actually drive some of the advances we need?”

mHub supports startups both through its incubator and its accelerator program. The incubator program is open to anyone who is there to build a business and mHub feels it can support them. The accelerator selection process is more rigorous. It involves a selection committee of roughly 20 people drawn from investors, industry and people who have led manufacturing science at universities and national labs, and the ability to meet 19 factors. But the crucial criteria are the novelty of their ideas, their understanding of their markets, their teams and their willingness to be coached.

“We bring cohorts together around a theme partner with industry,” said Allen. “We give each of the teams $75,000 cash and $25,000 of engineering credits that they just have to use to advance their product. Then we hyper-resource them for a six-month program, and then keep them having access to the whole labs and resources for two years beyond that.”

mHub is opening its next round for climate- and energy-focused startups on May 8.

mHub opens much bigger facility to kick Chicago startups into high gear by Haje Jan Kamps originally published on TechCrunch

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Is there a future in light-powered AI chips?

The growing compute power necessary to train sophisticated AI models such as OpenAI’s ChatGPT might eventually run up against a wall with mainstream chip technologies.

In a 2019 analysis, OpenAI found that from 1959 to 2012, the amount of power used to train AI models doubled every two years, and that the power usage began rising seven times faster after 2012.

It’s already causing strain. Microsoft is reportedly facing an internal shortage of the server hardware needed to run its AI, and the scarcity is driving prices up. CNBC, speaking to analysts and technologists, estimates the current cost of training a ChatGPT-like model from scratch to be over $4 million.

One solution to the AI training dilemma that’s been proposed is photonic chips, which use light to send signals rather than the electricity that conventional processors use. Photonic chips could in theory lead to higher training performance because light produces less heat than electricity, can travel faster and is far less susceptible to changes in temperature and electromagnetic fields.

Lightmatter, LightOn, Luminous Computing, Intel and NTT are among the companies developing photonic technologies. But while the technology generated much excitement a few years ago — and attracted a lot of investment — the sector has cooled noticeably since then.

There are various reasons why, but the general message from investors and analysts studying photonics is that photonic chips for AI, while promising, aren’t the panacea they were once believed to be.

Is there a future in light-powered AI chips? by Kyle Wiggers originally published on TechCrunch

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Betaworks’ new ‘camp’ aims to fund transformative early-stage AI startups

In a sign that the seed-stage AI segment is still alive and kicking, Betaworks, the startup studio and VC firm, is launching a new program that’ll award around ten companies working on AI $500,000 in funding.

Scheduled to run from mid-June until mid-September, Betaworks’ program — the ninth of its kind — will provide startups access to benefits including a business-building curriculum and accelerated compute from companies including Hugging Face and Stability AI. That’s in addition to one-on-one mentorship time, events and activities plus “collaboration opportunities” with other Betaworks cohort ventures.

The program isn’t quite an accelerator; Betaworks describes it like a “camp.” Rather than writing a small check into companies across a range of categories, the firm’s looking at the “evolution” of technology and betting on a cohort that’s creating or defining a new category.

“This is the biggest change in technology in my lifetime,” Betaworks CEO John Borthwick told TechCrunch in an email interview. “We’ve been building, accelerating and investing in and around machine learning for the last decade, and in the last 12 months, everything’s changed — the launch of generative visual models like [OpenAI’s] DALL-E 2 last year, the open and affordable access to these models with the availability of stability and GPT. AI has the potential to affect every sector, and every part of how we live, work, play and even die.”

With the new “camp,” which is also being underwritten by Mozilla Ventures and Greycroft, Betaworks is specifically looking to recruit companies creating AI tools that “augment the way humans behave, create, play, work and think.” For example, Borthwick says, this could be startups thinking about UIs that focus on the context of interactions over time, or ventures exploring the infrastructure required to allow for human collaboration alongside AI tools.

“The AI stack hasn’t been fully defined yet,” Borthwick said. “Just like the early days of the internet, there will be extraordinary companies built, providing infrastructure and foundational tools, and there will also be middleware and applications that become embedded in our lives and augment pretty much everything we do.”

When asked about the legal challenges facing some AI tech, particularly generative AI, and how it might affect the startups that Betaworks intends to fund, Borthwick didn’t shy away from answering. He expects copyright, intellectual property and attribution model ownership issues will play out over the next few years and ultimately not to have an adverse impact on startups in the space — or their business models.

“Some laws and frameworks that we have today will apply and others will need to be made,” Borthwick added. “This is like the beginning of the internet where, for example, a ‘right to be forgotten’ rule hadn’t been considered yet because the technology hadn’t demanded it.”

That might be optimistic. But Betaworks hasn’t let potential legal headwinds around AI get in the way before.

The firm is funding Stability AI, which is currently embroiled in a legal battle over whether the company infringed on the rights of millions of artists by developing its text-to-image tools using web-scraped, copyrighted images. Stock image supplier Getty Images has also taken Stability AI to court for reportedly using images from its site without permission.

Suffice it to say, Betaworks has an appetite for risk — and anticipates that the reward will be worth the struggle, apparently.

“AI cleaves open the possibility space around any problem,” Borthwick said. “That was one of the big lessons of [DeepMind’s] Alpha Go for us — the tech found solutions that nobody had ever considered before, and that was on a simple game board.”

Betaworks’ new ‘camp’ aims to fund transformative early-stage AI startups by Kyle Wiggers originally published on TechCrunch

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Iterative launches its second fund for Southeast Asia startups

Despite global headwinds, Southeast Asia’s early stage startups are still going strong, say the founders of Iterative Capital. The Singapore-based venture capital firm, which runs a YC-style accelerator program, announced today it has raised $55 million for its Fund II from LPs like Cendana, K5 Global, Village Global and Goodwater Capital.

Other backers include a group of founders and executives, such Dropbox co-founder Arash Ferdowsi, Bukalapak co-founder and former CEO Achmad Zaky, Andreessen Horowitz general partner Andrew Chen, former YC COO Qasar Younis, former Foursquare CEO David Shim and Airbnb Asia head Kum Hong Siew.

Since launching Iterative’s Fund I in 2021, the firm has backed more than 65 companies in 5 cohorts. Its portfolio companies have raised $163 million in follow-on funding and are worth $1.2 billion in total. Venture firms that have invested in Iterative’s portfolio companies include Insight Partners, Tiger Global, Monk’s Hill, Wavemaker and Hustle Fund.

The new funding will allow Iterative to increase its check sizes to $500,000 and add more programs for founders in different stages, including ones for earlier-stage founders who aren’t ready for an accelerator yet and later-stage founders who have already gained strong traction. With Fund II, Iterative’s plan is have bigger batches of startups of about 30 each. Its goal is to invest in 100-plus companies at more stages, including pre-seed, seed and Series A startups. While Iterative’s first fund did not perform follow-on investments, the firm is now in the position to do so.

Iterative co-founder and general partner Brian Ma said Fund II took just four weeks to raise, because Fund I’s founders performed well. Many of the first fund’s LPs returned and attractive return profiles in Southeast Asia also attracted new LPs.

Startups in Iterative programs have access to its 80+ group of venture partners and visiting partners, who are all previous or current operating founders.

“More concretely, we run weekly office hours, group office hours, speakers and workshops with our visiting partners, have a scaled out fundraise bootcamp program, a built out network to automate white-gloved introductions to investors and 450+ investors engage with our startups at our demo days,” said Ma.

“Some of the most important work actually happens post-cohort, where we help alumni companies deal with negotiating their A’s or B’s, deal with scaling their organizations and help coach them through cofounder issues and other growing pains.”

Some examples of Iterative’s portfolio companies that have recent raised money include Spenmo, which closed a $85 million Series B round led by Tiger Global; travel company GoZayaan, which raised $8 million and acquired FindMyAdventure to expand beyond Pakistan; and proptech startup Propseller, which raised $12 million Series A in August. Meanwhile, another Iterative alum, Sendhelper, was acquired by PropertyGuru in October.

Iterative’s founders remain upbeat about startups in Southeast Asia. Even though there are currently less startups currently exiting there, early-stage investments continue to increase. For example, a report by Google, Temasek and Bain & Co. found that Southeast Asia is “relatively less impacted by global economic trends” and that its real GDP growth is still 4.6% year-over-year. Iterative’s founders also note that Southeast Asia’s digital economy is expected to reach $200 billion this year, while Indonesia’s online spending it expected to hit $130 billion by 2025. Vietnam is an especially promising market, forecasted to more than double its online GMV over the next three years.

Ma said Southeast Asian startups benefit from high potential and reasonable valuations. “With depressed economies and lofty priced companies in the U.S., China, etc., more capital is flowing into more nascent and higher growth regions like Southeast Asia. We believe this is where the best returns will come from in the next 7 to 10 years.”

Iterative launches its second fund for Southeast Asia startups by Catherine Shu originally published on TechCrunch

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Say hello to the newest crypto startups from web3 accelerator Alliance DAO’s demo day

New crypto startups forged ahead during Alliance DAO’s demo day on Wednesday amid the FTX implosion.

“This is actually worse than the 2018 bear market,” Qiao Wang, a core contributor at Alliance DAO, said, referring to the tentative plans for Binance to absorb competitor FTX. “Today, everyone was caught off guard, myself included … the last three months of working closely with our founders in All9, I’m hopeful again. It’s people like them that will push our industry forward.”

The most recent cohort, known as All9, for Alliance DAO, a web3 accelerator and builder community, presented their ideas on Wednesday during a demo day, exclusively covered by TechCrunch. It seems like it was just yesterday that we covered Alliance DAO’s previous demo day, but four months have passed.

Twice a year, Alliance DAO brings in web3 founders for a three-month program. To date, Alliance DAO alumni have created over $10 billion in market capitalization, Wang said. There were about 953 applications for this cohort, but only 17 teams were chosen and graduated from the program.

Many of the teams are looking at improving crypto themes like proof-of-physical-work, wallet experience for everyday users, product-driven protocols, crypto B2B products, on-chain data and verticalization, Wang said. “The cohort is a fairly representative sample of what’s happening in the industry at large.”

The cohort focused on a range of subsectors and products across web3 like authentication, liquid staking, crypto wallets and decentralized machine learning, among others. About 38% of the startups focused on the Ethereum ecosystem, while Polygon made up 21% and Solana 17%.

Mentors include Colleen Sullivan, co-head of ventures at Brevan Howard Digital; Mike Dudas, founder of LinksDAO, The Block and an investor for 6th Man Ventures; Anatoly Yakovenko, co-founder of Solana; Ryan Selkis, founder and CEO of Messari; Mounir Benchemled, founder of ParaSwap; Amir Bandeali, co-CEO of 0x Labs; and Ryan Wyatt, CEO of Polygon Studios.

Here’s a breakdown of the 17 startups:

Company name: Ora

  • What it does: Search engine for web3
  • Founders: Dennis Antela Martinez, Sanny Kim, Jacob Shiohira
  • Stage: Seed
  • The pitch: Ora is building a search engine for web3 as the ecosystem continues to expand, co-founder Jacob Shiohira said during his pitch. “Blockchain data is confusing and we can see this in explorers today,” he said. For crypto to go mainstream, there need to be products that every person can understand, he added. Ora aims to combine sequel engines, dashboards and explorers through one interface. It began with indexing data from the layer-1 blockchain Solana, but plans to expand across web3.

Company name: Mensari

  • What it does: Quickbooks for web3
  • Founders: Vidur Jain, Manuj Paliwal
  • Stage: Seed
  • The pitch: Mensari aims to help businesses involved in web3 with its own Quickbooks platform. As organizations integrate crypto, their bookkeeping complexity is “skyrocketing,” co-founder Vidur Jain said during his presentation. Mensari built a double-entry accounting system offering operational accounting and portfolio accounting for organizations with web3 idiosyncrasies like asset swaps, payment streaming, NFTs and liquidity provision. The platform is live on blockchains Ethereum and Polygon and has 15 beta customers to date.

Company name: Tensor

  • What it does: Solana-focused NFT aggregator
  • Founders: Richard Wu, Ilja Moisejevs
  • Stage: Seed
  • The pitch: Tensor is aiming to build a Solana-focused NFT aggregator. Current NFT marketplaces cater to retail investors, not traders, and as more professionals enter the NFT market, they need more sophisticated tooling, Ilja Moisejevs said during his pitch. Tensor aims to provide Solana-based NFT traders more services so they can “fire off hundreds of transactions across eight of the largest marketplaces with just a single click.”

Company name: Raleon

  • What it does: Web3 marketing analytics
  • Founders: Nathan Snell, Adam Larson
  • Stage: Seed
  • The pitch: Raelon is building a marketing analytics firm for web3. The current marketing technology doesn’t cater to web3 tools or on-chain and off-chain data, so it needs to be revamped to consider new technologies, co-founder Nathan Snell said. Raleon combines blockchain data with Web 2.0 data to create an “enriched identity” so projects can target web3 users, Snell said. The platform is looking for strategic investors to source customers.

Company name: Spexigon

  • What it does: Proof-of-physical-work for drone imagery
  • Founders: Adam Killam, Peter Szymczak, Bill Lakeland, Alec Wilson
  • Stage: Seed
  • The pitch: Spexigon is a proof-of-physical-work platform for drone imagery where drone owners can earn crypto by capturing imagery in a fly-to-earn rewards system. Pilots are rewarded with tokens once the algorithm verifies images and moves it into the marketplace for consumption by businesses and developers. The platform has had over $1.5 million in revenue over the past eight months after gaining interest from government agencies, engineering firms and rail companies, to name a few. It has raised $5.5 million in a seed round with participation from Alliance DAO, Dapper Labs, and others.

Company name: SlashAuth

  • What it does: Web3 authentication
  • Founders: Ned Rockson, Nicolas Salhuana
  • Stage: Pre-seed
  • The pitch: SlashAuth is a web3 authentication platform that aims to help developers create distributed and secure identities across both Web 2.0 and web3 ecosystems. It cryptographically merges identities across both layers so users can have access to all of their accounts through one single sign-in, co-founder Nicolas Salhuana said during his presentation. It currently is in closed beta and has raised $3 million from investors like Alliance DAO and Y Combinator.

Company name: Stride

  • What it does: Cosmos-focused liquid staking
  • Founders: Riley Edmunds, Aidan Salzmann, Vishal Talasani
  • Stage: Seed
  • The pitch: Stride is building a liquid staking platform for layer-1 blockchain Cosmos. Users can trade their tokens for Stride’s ST tokens, then Stride stakes those tokens for users to be used throughout the Cosmos DeFi ecosystem. The platform was launched eight weeks ago but has $7 million in total value locked, $150,000 of recurring revenue and over 8,000 users, co-founder Vishal Talasani said. Stride has raised $6.7 million from investors like Pantera, Distributed Global, North Island Ventures, 1confirmation and Staking Facilities. It’s looking for LP commitments in exchange for Stride tokens.

Company name: Ethos

  • What it does: Sui-focused crypto wallet
  • Founders: Nadia Eldeib, Jared Cosulich
  • Stage: Seed
  • The pitch: Ethos is a “wallet super app” for the Sui blockchain. The wallet offers Web 2.0-like features like sign-in with email, which enables developers to provide a better user experience, co-founder Nadia Eldeib said during her presentation. The wallet has built an on-chain game where Ethos users can pre-approve transactions through its wallet. Since launching last month, there have been over 32,000 weekly users on its Chrome extension wallet. Ethos has raised $2.4 million from FTX, Tribe Capital and Mysten Labs.

Company name: Chain ML

  • What it does: Decentralized machine learning
  • Founders: David Müller, Ethan Jackson, Ron Bodkin
  • Stage: Seed
  • The pitch: Chain ML is a decentralized machine learning platform. It allows smart contracts and dApps to leverage machine learning and aims to not compromise on censorship resistance, tamper-proofing or usability. It leverages decentralized databases, oracles and compute networks running machine learning services to provide censorship resistance. Chain ML recently raised $4 million in a seed round led by iOS G. Its MVP launches in the first quarter of 2023.

Company name: Legends of Venari

  • What it does: Pokemon Go of web3
  • Founders: Jason Du, Drew Elkins
  • Stage: Seed
  • The pitch: Legends of Venari has taken the concept of Pokemon Go and brought it to the digital world through metaverses. Its software development kit shifted the focus from ownership of the game assets to ownership of an entire game’s ecosystem, co-founder Jason Du said during the demo day. Since launching 10 months ago, the game has an average of 3,000 weekly active users and has partnered with several NFT communities like Fractal. It has raised $5.4 million in a seed round led by Lattice Capital.

Company name: Sort

  • What it does: Web3 firebase
  • Founder: Jason Zucchetto
  • Stage: Seed
  • The pitch: Sort aims to be an easier way for developers to build dApps. “It’s still incredibly painful to write a decentralized application,” founder Jason Zucchetto said during demo day. Sort wants to simplify the process of writing open-source dApps by providing tool kits and cut-and-paste codes for developers. Over 200 people look at their tutorials per day, Zucchetto said. Sort is currently raising a seed round.

Company name: Persona

  • What it does: Building group chats as DAOs
  • Founders: Raeez Lorgat, Will Doenlen, Alexander Green
  • Stage: Seed
  • The pitch: Persona is building group chats as “lightweight DAOs,” co-founder Raeez Lorgat said during demo day. The popularity for DAOs have grown significantly over the past year, but the tools to form and manage DAOs remain fragmented across platforms. Persona wants to simplify the process so users can pool and govern funds within minutes for any specific shared purpose. Persona has raised $4.5 million to date from investors like ECCO Capital, Alliance DAO, CYGNI Capital and Protagonist.

Company name: Ostium

  • What it does: Commodities on-chain
  • Founders: Kaledora Kiernan-Linn, Marco Antonio Ribeiro, Emil Liu
  • Stage: Seed
  • The pitch: Ostium is a platform aiming to bring commodity markets on-chain. Many commodity markets are not accessible to non-institutional investors, co-founder Kaledora Kiernan-Linn said during demo day. The problems in commodity markets are solvable through decentralized finance, Kiernan-Linn added. By mirroring off-chain assets on-chain through oracles like Pyth, protocols like Ostium aims to provide liquid fractional exposure to assets at market price. Ostium is raising capital for a seed round and looking to partner with investors with expertise in liquidity provisioning.

Company name: Slise

  • What it does: Web3-native ad platform
  • Founders: Oleksii Sidorov, Griffin Kao
  • Stage: Pre-seed
  • The pitch: Slide is a web3 digital advertising-focused platform that aims to analyze on-chain activity to provide tailored ads across the web3 ecosystem. It is available on blockchains like Ethereum, Solana and Polygon. Slise won the Polygon Build It hackathon this past summer and is raising a seed round.

Company name: Space and Time

  • What it does: Decentralized data warehouse
  • Founders: Nate Holiday, Scott Dykstra
  • Stage: Series A
  • The pitch: Space and Time is a decentralized data platform that aims to help businesses grow through smart contract technology. It uses “Proof-of-SQL” cryptography to allow business logic in traditional centralized systems to be automated and connected directly to smart contracts. It also plans to integrate the platform with Microsoft Azure. In September, Space and Time raised $20 million in a strategic funding round led by Microsoft’s M12.

Company name: 0xPass

  • What it does: Web2-like user experience for decentralized applications (dApps)
  • Founders: Keon Kim, Krish Chelikavada
  • Stage: Pre-seed
  • The pitch: 0xPass aims to bring Web 2.0 -like user experiences to dApps so that mainstream users can have modern UX advantages in a wallet-agnostic manner. Some of its web3 user experience changes include onboarding users without wallets, pre-approving transactions and integrating 0xPass with a few lines of code. Its closed beta for onboarding SDKs launched last week and is being tested with 10 projects. It has raised $600,000 so far and is raising its seed round.

Company name: Niural

  • What it does: Compliant crypto payroll
  • Founders: Nabin Banskota, Nami Baral
  • Stage: Seed
  • The pitch: Niural is a compliant crypto payroll platform. It built a payment protocol on Polygon that enables real-time payroll for both fiat and crypto with low gas fees and a web3-focused human resources platform that can handle taxes and misclassification risk. It partnered with companies like Renfroe, which has over 20,000 employees, and Scrum Launch, which has team members across 72 countries. Niural has raised $5 million in a seed round with participation from Inspired Capital, New Form Capital, Alliance DAO and others. It’s currently seeking strategic investors.

Say hello to the newest crypto startups from web3 accelerator Alliance DAO’s demo day by Jacquelyn Melinek originally published on TechCrunch

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Station F turns its main startup program into an acceleration program

Station F, the iconic startup campus in Paris, is revamping its Founders Program completely to turn it into an acceleration program. Founders who decide to join the accelerator will get many different benefits. They’ll also have to hand out a 1% equity stake to Station F.

“We are changing the flagship program of Station F. Everything is changing but the name,” Station F director Roxanne Varza told me.

With the Founders Program, Station F is looking for entrepreneurs who are just getting started. Even if these teams haven’t necessarily found a product-market fit, they can apply to join the program.

Of course, the first thing these startups get when they join the Founders Program is some office space at Station F. They will then start with an intensive 6-week program with workshops and classes. For instance, they’ll learn about building a startup team and product-market fit.

After that, startups get another six weeks to iterate and execute. They pitch in front of everyone after this initial phase. Startups then stay at Station F for another 12 months. They pitch their startup once again at the end of the program.

The new Founders Program lasts 15 months in total, which is much longer than the original Founders Program. “With short programs, startups want to stay and we spend too much time on changes and logistics,” Varza said.

In order to remain focused on these startups, Station F is actually shrinking the size of the Founders Program. Station F could accept up to 200 startups with its old Founders Program. It now aims to accept 25 startups in the Founders Program with two batches per year.

Station F tries to match each startup with an advisor that will be very hands-on. For instance, some advisors include the founders of Alan, Swile and The Sandbox. Station F recommends that startups incentivize the advisor by adding them to the cap table. It can vary depending on the advisor but Station F recommends at least 0.2% in equity.

The startup campus is already running a first batch with 21 different companies. These companies are focused on four verticals — web3, fintech, impact and creator economy. Verticals will change in future batches.

And, yes, Station F is taking equity in those startups for the first time. “At first, we want to remain founder friendly. Some people told us it’s not a lot, others say that it’s a lot,” Varza said.

“But Station F is not here to take 50% in equity. We just want to prove that we have skin in the game and that we will remain engaged,” she added.

Station F relies a lot on personal recommendations from other people in the tech ecosystem. The internal team then screens the applications to pick some startups. Applications for the next batch will start near the end of November.

There are also other programs on the campus as well as partnerships with other companies so that they can run their own program at Station F. All the other programs remain unchanged.

Station F turns its main startup program into an acceleration program by Romain Dillet originally published on TechCrunch

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Techstars unveils sustainability-focused acceleration program in Paris

Techstars, a network of startup accelerators and an investment company, is launching a new accelerator in Paris called Techstars Sustainability Paris. This isn’t the first time that Techstars is running an accelerator in France as the company originally launched Techstars Paris in 2017.

With this sustainability-focused accelerator, Techstars is hitting the reboot button. Going forward, the Paris team will focus exclusively on impact startups with Raphaele Leyendecker acting as the managing director.

Every year, Techstars Sustainability Paris plans to accept 24 startups across two batches. Companies receive $120,000 and hand out 6% of their equity. They also go through an intense acceleration program that should help them scale and reach the next level.

I talked with Baptiste Fradin who currently acts as entrepreneur in residence for this accelerator. He believes that the tech ecosystem has matured quite a lot in France over the past ten years. But impact companies could still benefit from new processes, better network effects and more ambition in general. According to him, Techstars could bridge the gap between these two worlds.

France could become a leading market when it comes to sustainability-focused and impact startups due to local and European regulation, innovation and talent looking for opportunities in this ecosystem. That’s why Paris makes sense when it comes to building a team of mentors, investors and corporate partners for a sustainability accelerator.

But because it’s a hybrid program, companies don’t have to be based in France to apply. Techstars already has 24 portfolio companies for its sustainability program, and 16 of them aren’t based in France.

With this program, Techstars is looking for companies working on water, energy, waste management and other sustainability-related issues. It is then tech and industry agnostic, which means that these companies can be hardware, software but also deeptech, biotech or fintech startups.

Some companies include Kumulus Water, a startup working on a water generator from air, Mavuno Technologies, a company that uses satellite imagery and machine learning to improve harvest yield, and Outlander Materials, a company working on a new material made out of organic waste to replace plastic. And if things work well for portfolio companies, Techstars can also offer to invest in funding rounds down the road.

Techstars unveils sustainability-focused acceleration program in Paris by Romain Dillet originally published on TechCrunch

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The biggest moonshots from 500 Global’s latest Demo Day

It’s demo day season. This morning marked the kickoff of VC firm 500 Global’s Fall 2022 Demo Day, which saw over a dozen startups give their best pitches to prospective investors — and customers. Participants ran the gamut from fintech and sustainability to edtech and developer tools, and several stood out from the rest of the pack.

The event comes just weeks after Y Combinator had its bi-annual Demo Day, its first since moving operations back to in-person. 500 Global, formerly branded under 500 Startups, has an accelerator that competes with YC. Both outfits look to back early-stage founders with money and advice in exchange for equity. YC has backed over 3,500 founders, while 500 Global has backed more than 2,800 founders, according to each institution’s websites. Unlike YC, 500 Global has geographic-specific accelerator programs, similar to Techstars, with focus on areas like Aichi, Japan, Cambodia, and Alberta, Canada.

That said, today’s debut from 500 Global is from its first and flagship program, hailing back from 2010 and, fittingly, including companies from all around the globe. All companies go through a four-month program but start at different times, thanks to 500 Global’s somewhat new rolling admissions strategy. Let’s dig into some of the moonshots of the batch and end with some notes from Clayton Bryan, partner and head of 500 Global’s Accelerator Fund.

The moonshots

For example, there’s Taiwan-based Rosetta.ai, an ecommerce startup tapping AI to let customers search for products — particularly apparel and cosmetic — through specific attributes. Rosetta’s AI algorithm “sees” which attributes (e.g., sleeveless, ruffled, microbeads) a shopper might want as they browse an online store and builds a “preference profile” for them, which merchants can use to cross-sell or set up promotions that trigger if it seems likely the shopper will abandon their cart.

Rosetta.ai

Image Credits: Rosetta.ai

It’s early days for Rosetta. But the company, which was founded in 2016, has raised $2.4 million in capital to date and claims to have customers including Shu Uemura, in which L’Oréal owns a majority stake. The trick will be continuing to win customers over rivals like Lily AI, which similarly attempts to match customers with products using attributes and AI models.

Elsewhere on Demo Day, Lydia.ai walked through its health assessment service for insurance carriers. Designed to do away with lengthy medical exams and forms, Lydia has insurance plan applicants answer a few questions about their health — e.g., whether they have a chronic illness, have recently been hospitalization and so on — via their smartphones. The platform then generates an abstracted health score supposedly devoid of sensitive medical details, which insurers can use for risk management and underwriting.

Lydia.ai

Image Credits: Lydia.ai

Lydia isn’t the first to attempt this. Health tech startup Fedo also algorithmically generates health scores, quantifying a person’s risk for diseases and their propensity to claim. The opaqueness of Lydia’s approach also raises questions, like whether its algorithms account for demographic differences and historic biases in health care. But if the startup remains true to its mission — insuring the next billion people — it could be one to watch, particularly given the capital (~$13 million) already behind it.

One of the more unique Demo Say startups that presented was BetaStore, a supplier for the “informal” retail outlets common in Africa. Informal retailers are unlicensed and unregistered retailers that don’t report to tax agencies, typically operating out of open markets and shops. BetaStore serves as a goods marketplace for informal retailers, providing access to staples such as dish soap, laundry detergent and all-purpose cleaner at wholesale prices and delivering them to the retailers (within 48 hours).

BetaStore

Image Credits: BetaStore

BetaStore customers can order products via chat, text message or WhatsApp. On the backend, the platform provides sales analytics to manufacturers, which BetaStore notes can be leveraged to make “data-driven” decisions to scale up shipments.

BetaStore appears to be off to a strong start. Founded in 2020, the Nigeria-based startup claims to have distributed over 140,000 goods to retail customers in Nigeria, Ivory Coast and Senegal and fielded over 20,000 orders. Recently, BetaStore began offering financing to retailers and plans to launch a buy now, pay later product in the coming months.

One year after the rebrand

Minutes after Demo Day ended, Bryan spoke to TechCrunch about 500 Global and how it’s growing within an increasingly volatile (and competitive) market.

“It’s been kind of gloomy, but we’ve told our companies time and time again that the silver lining is that 2021 was a phenomenal year for venture funds raising financing,” he said, fitting into the news that U.S. based investors are sitting on $290 billion in dry powder right now. The accelerator’s top advice was to start fundraising earlier, ready the company more before going out to the market, and stay smart on managing expenses. His advice these days is that startups should be preparing for at least 18 months of runway.

It has been almost a year since 500 Global rebranded from 500 startups, a move that Bryan said was meant to reposition the institution as less of an accelerator, and more of a venture firm. Its more than semantics; former batch participants have come back to 500 for follow-on funding, during their Series A but up till their series D.

“Historically, we haven’t had any any optionality, but now we’re going multi-strategy and we’re working on later stage funds,” he said. “We have the demand with our founder community, we have a demand even within our partner community that they want to have access to more de-risked companies.”

He added: “We’re very proud of our accelerator. It is a key vantage…but now it’s helped unlock other opportunities for us as a firm that we’re exploring with a lot of enthusiasm.”

As for if 500 will change its investment cadence, check size or focus – similar to YC as it prepared for a downturn –  Bryan said there’s more to come.

“We’re not immune to the the changes that are happening in our ecosystem, we’re aware of what other funds are doing and other programs are doing,” he said. “Our program has been operating strongly for the last 10 plus years. But at the same time, we can’t rest on our laurels, and we’ve got to make sure that we have compelling deal terms.”

The biggest moonshots from 500 Global’s latest Demo Day by Kyle Wiggers originally published on TechCrunch

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On Deck tried to do it all. Now, it’s trying to do less, better

Erik Torenberg is no longer the co-CEO of On Deck, a tech company that is trying to productize the community in a way that helps founders secure capital and advice. Torenberg, an early Product Hunt employee and the founder of investment firm Village Global, assumed the role only a year ago. But now, as On Deck returns to its founder-focused roots and spins off its second business, Torenberg is returning to a chairman position.

“Now that we are a leaner company with a focused mandate, it makes sense to return to our origins and operate as we had been for much of our history,” an On Deck spokesperson said via email. “Erik will remain deeply involved in On Deck, just as he has been since our beginnings.”

The move, shared internally to staff last week, is the latest shakeup for the business, which cut a third of its staff months after cutting a quarter of its workforce. Other changes at the well-known startup include the sunsetting of several communities and spinning off its career advanced arm into a new separate business entity. The spin-off cements On Deck’s goal to become a more founder-focused business instead of a broad platform where anyone searching for community in the world of tech can go for a slew of services.

David Booth, who co-founded On Deck alongside Torenberg, will now be the sole chief executive leading the business. The company has raised tens of millions in venture capital from investors, including Founders Fund, Village Global and Tiger Global. On Deck told TechCrunch that Booth was unable to do a phone interview due to a family obligation today.

“A lot of people are way happier because they don’t have to make as many weird trade-offs across two businesses, run by two CEOs, going after two completely different customer segments, and figuring out how this one brand stretches to make everybody happy,” one source said. “Everyone in the room is talking about the same person.”

Today, people can go to On Deck’s website to apply to its ODF program, which helps founders go from pre-idea to fundraise. It resembles a classic accelerator, but perhaps one step earlier than a Y Combinator. And instead of equity in exchange or a check, founders fork over $2,990 to be part of the program. The next iteration, starting September 27, ranges from an onboarding process in which founders are introduced to the community, to weekly programming on skill development and workshops. There are also services that help founders find other co-founders, prepare for the fundraising process and build minimum viable products.

This appears to be On Deck’s flagship program currently, taking place over the course of a full year. Other On Deck programs are shorter, ranging from eight to 10 weeks, and focus on different roles. On Deck Scale is for founders of high-growth, venture-scale companies and costs $10,000 per year. Despite saying it is focused on founders, it does still advertise programs for others in the startup world. On Deck Angels, to pick another example, is for operator angels interested in expanding their network or starting a fund, and costs a $5,000 donation to On Deck’s access fund (On Deck’s scholarship fund that the fellows it accepts can apply for and receive based on financial need. Over $2 million has been deployed since 2021). Execs On Deck is for experienced leaders looking for VP and C-suite roles at startups and costs $5,000.

While this appears to be different from the founder focus it is advertising, On Deck views it as related. “We are building the world’s most helpful community of angel investors and executives, both of whom are critical partners to founders at all stages of company formation,” the company said over e-mail to TechCrunch.

The revamped and smaller product offering comes after On Deck admitted struggles in offering a focused product. “In the past two years of hyper-growth, On Deck launched communities serving more than ten thousand founders and career professionals. Our team worked tirelessly to expand and cover a large surface area,” the co-founders wrote in a blog post addressing the latest layoff. “However, this broad focus also caused substantial tensions. What we’ve always projected as a strength — serving multiple user groups and building flywheels between them — also fractured our focus and brand.”

Tiger’s den

The narrowed focus is also a matter of practicality. After Tiger Global quietly led a $40 million Series B in On Deck, assigning it a $650 million valuation up from the $175 million valuation it was assigned by investors at its Series A round — the hedge fund committed to another product being developed by On Deck, a venture fund, sources say.

Tiger’s investment was designed to give it a clearer view of the pre-seed and seed world. The funding round — first reported by The Information but remains unconfirmed by On Deck — appeared to be the startup’s official entrance into growth-stage status. In return, On Deck got a massive valuation uptick and an anchor investor for its new venture operation (one that likely had enough of a well-known reputation to get other investors interested).

Tiger Global went on to commit money to On Deck’s vision for an ODX fund, an investment vehicle that would help it launch an accelerator. Up until that point, On Deck was charging membership fees to generate revenue, and a fund would shift it to bet on more long-term returns.

Sources say a term sheet — a document — was put on the table. On Deck, in response, began advertising the Tiger fund commitment to other investors, ultimately putting together a plan for a $100 million fund that it could use to invest in companies going through its accelerator.

When it came time for a capital call, sources say that Tiger Global told the startup that its fund commitment was still in legal due diligence. While the company declined to comment on its relationship to Tiger Global during the time, an On Deck spokesperson told TechCrunch that “due to the delays in closing fund LPs, On Deck’s holding company provided a capital credit call to the ODX fund to…enable it to fulfill its commitments to portfolio companies.”

Ultimately, sources say Tiger Global yanked its commitment to invest in the On Deck fund, despite having invested in the company itself and seemingly coming close to repeating its bets. On Deck did not comment on this situation when asked. TechCrunch reached out to a Tiger Global spokesperson for comment but did not hear back before time of publication.

It’s not unheard of to see firms yank term sheet offers after committing due diligence or in response to a worsening economic environment, despite the fact that it can ruin a round. It’s unclear why Tiger pulled its term sheet after leading an investment, but of course the firm has had a difficult time in the public markets.

In On Deck’s case, sources say that Tiger pulling its commitment put On Deck in a precarious position. Without Tiger’s capital infusion, On Deck had been spending right from its balance sheet, leaving it with only nine months of runway left. Then came the layoffs.

On Deck would undergo several rounds of cuts in May and August. The first round of layoffs was not enough, sources said. The company then spun out its career services platform, an effort some employees are bullish on because of the individuals involved. The spin-out company does not have a name, but plans to be launched by October. It is generating revenue.

From accelerator to just a classic investor

It’s a slow return to focus. On Deck employee Erika Batista became general partner of On Deck’s fund last month after helping build the company’s European accelerator. The fund, On Deck tells TechCrunch, is $23 million, or around a fourth of its original vision.

When asked about the accelerator, On Deck said it no longer has a formal accelerator. It provided a detail that showed a new vision for how it backs early-stage startups — perhaps one that requires less capital: startups are now offered $25,000 for 1% or up to 2.5% of ownership, compared to the prior deal in which startups were offered $125,000 for 7% of the startup.

It may not have a $100 million fund to fuel its accelerator, but it does have a corporate venture arm that it is using to make market deals, now with more mature founders who don’t love fixed terms. “Most comparable programs require founders to give up equity or take capital from a specific investor,” a spokesperson said over email. “Many of our fellows are experienced and repeat founders who have gone through traditional accelerators in the past and prefer our highly curated, non-dilutive program for founders at the earliest stages of company formation. “

Since On Deck has made these moves, Tiger Global has reportedly returned to its portfolio company with $5 million for the company’s fund, a check size which reportedly pales in comparison to its original commitment. On Deck, meanwhile, is switching back to revenue-generating programs instead of basing its entire future on the accelerator model.

“Tiger Global is a valued LP in our fund and in our corporation,” a spokesperson said over email. “We have no further comments on this relationship.”

On Deck tried to do it all. Now, it’s trying to do less, better by Natasha Mascarenhas originally published on TechCrunch