articles – Page 3 – Product Management Confabulation

August 24, 2022

Zilliz, the startup behind the Milvus open-source vector database for AI apps, raises $60M, relocates to SF

In 2020, Chinese startup Zilliz — which builds cloud-native software to process data for AI applications and unstructured data analytics, and is the creator of Milvus, the popular open source vector database for similarity searches — raised $43 million to scale its business and prep the company to make a move into the U.S. Nearly two years on, today Zilliz is announcing further funding of $60 million as it finally makes its move West, with a new HQ in San Francisco to capitalize on the growing demand for more efficient processing techniques for an ever-expanding trove of unstructured data getting commandeered to power AI applications.

Led by Prosperity7 Ventures — a $1 billion venture fund created by Saudi oil giant Aramco (the name is a reference to the first commercial well to strike oil in the country) — the round also includes previous Chinese backers Temasek’s Pavilion Capital, Hillhouse Capital, 5Y Capital, and Yunqi Capital. The company is not disclosing its valuation, but it’s worth pointing out that this latest injection is being described as an extension to that $43 million Series B rather than a new round. We’ll update this if we learn more. The total raised by the company is now $113 million.

The capital and relocation speaks not just to key moment for the company, but also for the area of machine learning and wider trends impacting Chinese-founded startups.

On the first of these, Zilliz’s breakout product, the open-source Milvus, has boomed. The company said that downloads have now passed the 1 million mark, compared to 300,000 a year ago, with production users growing by 300% in the same period — however, it didn’t disclose its active user numbers. Customers include the likes of eBay, Tencent, Walmart, Ikea, Intuit and Compass.

As we pointed out back in 2020, Milvus has not leaned heavily on advertising and marketing spend, instead choosing to leverage word of mouth on the places where developers like to hang out for ideas and inspiration to get itself noticed, such as Github and Reddit. That strategy has worked: “Stargazers” on Github are up 200% to more than 11,000 with the number of contributors doubling. (For a point of comparison, in 2020 it had been starred some 4,400 times.)

The reason for the interest in Milvus — and subsequently Zilliz’s roadmap, which is based around creating further products, most recently a Zilliz Cloud managed service that is now in private preview; and Towhee, another open-source framework, this one for for vector data ETL — is because of the rising interest in vector databases as how they are being used in AI applications.

Put simply, while data can be (and often is) processed via more traditional databases, the complexity of and structure of activities like anomaly detection, recommendation, rating and other AI-driven tasks lends itself more naturally and efficiently to vector databases designed to work with how AI data is represented. (Zilliz notes that its vector database “is both cloud native and capable of processing billion-scale vector data in milliseconds.”)

“Zilliz’s journey to this point started with the creation of Milvus, an open-source vector database that eventually joined the LF AI & Data Foundation as a top-level project,” said Charles Xie, founder and CEO of Zilliz, in a statement. “Milvus has now become the world’s most popular open-source vector database with over a thousand end-users. We will continue to serve as a primary contributor and committer to Milvus and deliver on our promise to provide a fully managed vector database service on public cloud with the security, reliability, ease of use, and affordability that enterprises require.”

There are others (competitors to Zilliz) like Pinecone and Weaviate also building solutions to address this. Pinecone raised money earlier this year and has some impressive names backing it including Tiger Global and Menlo Ventures (for a point of comparison PitchBook says Pinecone’s valuation is $168 million). Weaviate’s parent, SeMI Technologies out of The Netherlands, also raised this year, backed by the likes of NEA.

Meanwhile, big cloud providers like AWS also have their own solutions. All of that points to a market opportunity that Zilliz is focused to tackle.

It’s notable that back in 2020, Zilliz already said that more than half of the users of Milvus were outside of China: that speaks to how the company has long positioned itself and where it saw its growth longer-term. Xie — who goes by the nickname “Starlord” (yes) and previously worked as a software engineer at Oracle in the U.S. before relocating to start Zilliz in Shanghai — told TC that he thought of the startup as “global from day one.” But he saw an opportunity to build first in Shanghai because of the affordability of hiring engineers as well as the market size of China, and thus the volume of unstructured data to hand.

Of course, these days, as a number of startups in the country are looking to move elsewhere to have more freedom in terms of how they grow their businesses, and to work with a wider set of customers, Zilliz is an example of that in action.

Prosperity7 has been playing a role in facilitating this migration. The fund only entered China last year and has been actively hunting down startups with a global ambition, which could tap the firm’s vast global network. We recently covered two such investments, Jaka, a Beijing- and Shanghai-based collaborative robotics startup, and Insilico, an AI drug platform from Hong Kong.

Prosperity7’s investment in Zilliz seems to fit nicely into the investor’s mandate. It’s not uncommon to see Chinese SaaS companies going global these days. Many are started by Chinese entrepreneurs with an international background. They might have spent a few years testing the market at home and raising from VCs who are increasingly keen on B2B projects as the B2C space becomes saturated. But many find it hard to monetize in China, where small and medium enterprise owners are still reluctant to pay for software subscriptions compared to their Western corporate counterparts.

“With its leadership on Milvus, Zilliz is a global leader in vector similarity search on massive amounts of unstructured data,” said Aysar Tayeb, executive MD of Prosperity7 Ventures, in a statement. “We believe that the company is in a strong position to build a cloud platform around Milvus that will unleash new and powerful business insights and outcomes for its customers, just as data analytics platforms like Databricks and Snowflake have done with structured data. There is already over 4x more unstructured data than structured data, a gap that will continue to grow as AI, robotics, IoT, and other technologies meld the digital and physical realms.”

August 23, 2022

As our populations age, this startup is turning live-in care into a gig-economy platform

As developed-world populations increasingly get older, healthcare is being rapidly digitized and “platformized” in order to meet the huge scale of change heading our way. I recently covered how Cera in the U.K. just raised $320 million to shift monitoring of patients into the home rather than over-flowing hospitals.

Now another startup aims to create an almost “gig-economy style” platform for people providing live-in care to the elderly, this time in Europe.

Marta, the European digital platform for live-in care, says when people try to arrange this kind of care for their elderly relatives, there are up to six intermediaries involved, and four out of five placements fail. Marta’s solution is an AI-driven matching platform where carers can be found for live-in positions. I guess you might call it UpWork for live-in care?

It’s now raised a €6.6 million seed round led by Capnamic, alongside co-lead Almaz Capital. Ithaca, GMPVC, SumUp Impact Fund, Verve Ventures and angels also participated. Existing investors such as Christian Vollmann, Johannes Schaback, Laura Esnola, Dr. Steffen Zoller and Julian Stiefel also participated.

The startup plans to now scale up in its European markets of Germany, Poland, Romania and Lithuania.

The market it’s addressing is an €18 billion market in the DACH region alone.

Given that Germany alone has more than 4 million people seeking at-home care and there are only 280,000 caregivers able to do this, the market is sizable.

Marta’s says its algorithm-based marketplace enables matchmaking between care seekers and caregivers, increasing transparency and a person-to-person experience.

“There are hundreds of examples of how elderly care can go wrong and it’s almost impossible for humans to accurately predict placement success because it’s just so many data points. We have seen how difficult it was to organize care with our grandparents. Aging is a normal process and should not pose a major problem. We believe that we can leverage technology significantly to help elderly people and their families as well as the caregivers,” said Jan Hoffmann, co-founder of marta in a statement.

Marta’s founders, Philipp Buhr and Hoffmann started marta in 2020 after having problems finding carers for relatives.

“Marta has created a transparent marketplace where it connects caregivers directly with families seeking care. At this point a truly unique approach based on digitization. We have been following marta for the past months and are impressed by the technology and traction the team has delivered. Most importantly, we are excited about the teams’ enthusiasm for solving a paramount societal problem,” added Jörg Binnenbrücker, founding partner at Capnamic.

August 23, 2022

Ex-security chief accuses Twitter of cybersecurity mismanagement in an explosive whistleblower complaint

Twitter’s former head of security Peiter “Mudge” Zatko has accused his former employer of cybersecurity negligence in an explosive whistleblower complaint first obtained by CNN and The Washington Post.

Zatko, a well-known hacker, was recruited by Twitter to head up the company’s security division in late-2020, months after a very public breach saw hackers hijack the Twitter accounts of some of the world’s most famous people, including Joe Biden and Elon Musk. He was let go from the company less than two years later.

Though his time at Twitter was brief, Zatko says he witnessed “egregious deficiencies, negligence, willful ignorance, and threats to national security and democracy,” according to his whistleblower complaint dated July 6, which was filed with the U.S. Securities and Exchange Commission (SEC), the Federal Trade Commission (FTC) and the Justice Department. He told the Washington Post that his public whistleblowing comes after his attempts to flag the security lapses with Twitter’s board were ignored.

Zatko alleges in the complaint, reviewed by TechCrunch, that Twitter lacked basic security controls. He said thousands of employee laptops contained complete copies of Twitter’s source code and that about one-third of those devices blocked automatic security fixes, had system firewalls turned off, and had remote desktop access enabled for non-approved purposes. Zatko also accused the company of failing to actively monitor what employees were doing on their computers. As a result, “employees were repeatedly found to be intentionally installing spyware on their work computers at the request of external organizations,” the complaint said.

Zatko also alleges that about 5,000 full-time employees had broad access to the company’s internal software and that access was not closely monitored, giving them the ability to tap into sensitive data and alter how the service worked.

During his time at the company, Zatko said he came across a number of vulnerabilities “waiting to be discovered.” He says he discovered that half of the company’s 500,000 datacenter servers run on outdated software that do not support basic security features, such as encryption for stored data, or no longer received regular security updates from their vendors, This meant that Twitter suffered from an “anomalously high rate” of security incidents, Zatko said, and “reasonably feared Twitter could suffer an Equifax-level hack,” referring to the 2017 credit agency breach that resulted in the theft of close to 150 million Americans’ personal information.

The complaint alleges that the company had approximately one security incident each week serious enough that Twitter was required to report it to government agencies.

“In 2020 alone, Twitter had more than 40 security incidents, 70% of which were access control-related,” the complaint reads. “These included 20 incidents defined as breaches; all but two of which were access control related.”

Beyond claims of serious cybersecurity failings, Zatko also alleges that the Indian government forced Twitter to hire one of its agents and that the company repeatedly violated the terms of a 2011 agreement with the FTC. The complaint alleges Twitter does not reliably delete users’ data — including direct messages — after they cancel their accounts, in some cases because the company has lost track of the information, and that it has misled regulators about whether it deletes the data as it is required to do.

The complaint also has potential implications for Twitter’s legal battle with Musk, who is trying to get out of a $44 billion contract to buy the social media platform. Zatko says Twitter executives don’t have the resources to fully understand the true number of bots on the platform, and weren’t motivated to do so.

Twitter spokesperson Madeline Broas told TechCrunch in a boilerplate statement: “Mr. Zatko was fired from his senior executive role at Twitter in January 2022 for ineffective leadership and poor performance. What we’ve seen so far is a false narrative about Twitter and our privacy and data security practices that is riddled with inconsistencies and inaccuracies and lacks important context. Mr. Zatko’s allegations and opportunistic timing appear designed to capture attention and inflict harm on Twitter, its customers and its shareholders. Security and privacy have long been company-wide priorities at Twitter and will continue to be.”

Twitter fixes security bug that exposed at least 5.4 million accounts

August 23, 2022

Dutchie launches new cannabis Point of Sale platform with its own dual-screen register

Dutchie today is announcing a new cannabis point of sale platform, including a dual-screen terminal for dispensaries. Called Dutchie POS, this comes just weeks after the company announced a new payment platform, Dutchie Pay.

With Dutchie POS and Dutchie Pay, the cannabis tech company is now offering cannabis operators one of the most comprehensive platforms to manage dispensaries. The new point of sale system serves the budtender and customer alike. The budtender’s view is customizable and features front-of-house functions to improve customer interactions while still handling inventory management and reporting regulatory compliance information.

Ross and Zack Lipson co-founded Dutchie in 2017 and raised $603m to date. The company was valued at $3.75b as of its raise in November 2021. Dutchie now employs around 700 people.

Zack Lipson spoke to TechCrunch ahead of Dutchie POS launch, saying this solution is built to accommodate dispensaries of all sizes. “It’s intuitive and simple enough for SMBs and mid-market retailers, but can also flex up to the enterprise level dispensaries and MSOs.”

Dutchie started working on this platform in 2021, and Lipson says it began with serious due diligence. He says the company spoke to “literally hundreds” of retailers to get insights. The company also acquired Greenbits and Leaflogix to jump-start the point of sale platform development.

“The premise is we wanted to offer the best of both worlds with Leaflogix and Greenbits,” Lipson said. “And that looks like a combination of power, robust configurability, and that’s something Leaflogix’s did really well. We were constantly hearing retailers’ feedback that they wanted the technology to conform to their operations and essentially get out of the way.”

According to Lipson, the point-of-sale platform offers retailers an integrated, cohesive experience that’s fully customizable to the retailer’s standard operating procedures. “This is absolutely critical,” he said. “There are so many different ways that operators run their dispensaries. And with the constraints they have, it’s really important that they build in the operational efficiencies.”

The new hardware terminal is critical to Dutchie’s point of sale offering. There are two screens: the customer gets a 10-inch screen while the budtender works with a 15-inch screen.

“The customer-facing display holds a lot of power,” Lipson said. “We’ve seen this in other retail environments from local coffee shops or traditional retail, but they’re not here in cannabis yet. So this is something we’re super excited about, and we will do a lot with that customer-facing display in the near future.”

Dutchie is launching this Dutchie POS nationwide and in Canada. The platform is sold through a SaaS offering, and pricing varies per usage.

August 18, 2022

Work exchange your way to TechCrunch Disrupt for free

Ever wonder what it takes to produce a world-class tech conference? Here’s your chance to find out by helping us bring TechCrunch Disrupt to life on October 18–20. Apply to volunteer for work exchange, and you’ll earn a free pass to all three days of the show.

That free pass gives you access to the full Disrupt experience — the Disrupt stage, the TechCrunch+ stage, the Discovery stage, breakout sessions, roundtable discussions, the expo floor — where you’ll find the Startup Battlefield 200 — and the Startup Battlefield competition.

Volunteers handle a variety of tasks to help make this startup conference an unforgettable experience for everyone. At any given time, you might help with registration, wrangle speakers, direct attendees, stuff goodie bags, place signage, scan tickets or help with pre-marketing activities.

Here’s what you need to know before you sign up to volunteer, and if you can meet the following criteria, we want to hear from you:

Be available October 17–20.
Attend a mandatory orientation on Monday, October 17 at Moscone Center.
Work a minimum of 10 hours during the entire conference, starting from October 17 (the day before the conference starts) to October 20. You’ll find volunteer shift availability in the application. If we select you for some pre-event opportunities, they will count toward your hours.
You might be scheduled for an 8- to 9-hour shift, or you might be scheduled with two separate shifts of 4 to 5 hours each. Shifts can start as early as 6:30 a.m. PDT or end as late as 8:30 p.m. PDT.
You must provide your own housing and transportation.
Due to the high volume of applications, we will notify only the selected applicants.
Read the volunteer FAQ for more information.

TechCrunch Disrupt takes place on October 18–20 in San Francisco. Lend us a helping hand, and we’ll hand you a free pass. Save money, gain valuable experience and still have plenty of time to take in all the startup goodness Disrupt offers. Apply to volunteer before October 3 to get your free pass, and we’ll see you in San Francisco!

August 18, 2022

Veterinary telehealth service Vetster launches in the UK, post expansion in the US

Vetster, a veterinary telehealth service which has raised $40M, is launching in the UK following expansion in the US.

Vetster connects licensed veterinarians with pet owners via video, voice and online chat.

It hopes to fill a yawning gap in provision. In the UK one in two veterinary clinics are overbooked and unable to take on more patients, according to research.

Vetster commissioned research through 3Gem with 150 vets in March 2022 and found vets are overwhelmed with pets, overbooked and unable to take on new patients. And many are looking to quit. So the Telehealth industry is probably arriving just in time.

Mark Bordo, CEO and coFounder of Vetster. “Veterinarians are facing tremendous pressure to provide services to millions of pet owners. Vetster’s virtual care platform connects pet owners with licensed UK veterinarians to provide support when their clinic is closed, to answer a non-urgent question, and to improve the health outcomes of their pet and help ensure owners can care for their animals.”

The pet telehealth service has been live in North America for over two years.

Vetster raised $30M USD in its Series B funding in April 2022.

Competitors include Televet (raised $7M) ,Dutch ($25M), and Pawp ($17.5M), among others.

August 17, 2022

Venue raises $4M from Accel and the CEOs of Slack, Remote, and SquareSpace to give team-wide video meetings a new breath of life

Zoom has in many ways “won” the mindshare game when it comes to video conferencing: whether you’re actually using Zoom, or another service that’s wrapped into another platform like Google or Microsoft, and whether it’s for work or fun, the standalone Zoom is the one that people reference, the one that has claimed anthimeric status.

But for those who use Zoom, or Google’s Meet, Microsoft’s Teams, or something else, you’ll know that they still lack in certain scenarios. Today a startup called Venue built to plug one of those gaps — larger team meetings — is setting out its stall to compete, with a video conferencing platform that brings in a host of personalization and other features from consumer communication apps to make it more engaging. These include emoji bursts, the ability to set background music and backgrounds, easy tools to share videos and other media, gifs, and multi-functional control panels that mimic those that appear in streaming platforms like Twitch.

“Our clients have told us that if Slack made video conferencing for team meetings, this is what it might look like,” said Jason Goldlist, who co-founded the company with Frank Poon, in an interview with me (which took place, naturally, on Venue).

The Toronto-based startup has been in private beta for the past two years, first as a bootstrapped business and then as part of the Y Combinator Winter 2022 cohort.

In that time, it’s picked up some very interesting traction. Its customers include Yelp, Shopify, and PwC; and it’s so far hosted more than 5 million minutes of meetings and 250,000 participants in aggregate.

And now it’s announcing $4 million in seed funding from an impressive list of backers: led by Accel, the group also incudes Stewart Butterfield, the CEO and co-founder of none other than Slack (he is investing directly, the investment is not coming from the Slack Fund, and this is the video pitch, in Venue, that Goldlist used to pitch him); SquareSpace founder and CEO Anthony Casalena; and the founder and CEO of Remote.com, Job van der Voort.

Venue will be using the funding both for more product development, and also to scale its infrastructure to work with more customers.

Venue’s basic pitch is that it’s not another video conferencing platform. As Goldlist told me the other day, the aim is not to replace Zoom, Meet, Teams or the others, which are perfectly serviceable for one-on-one or small group virtual gatherings.

“We see Zoom as the Craigslist of video conferencing,” he said. “You will always have people who will use it.

“Our role is not to out-Zoom Zoom,” he continued. “It’s to pick our niche and to execute really well. There is a specific set of use cases and venue is the best at and no one focuses the way we do on the all hands, the town halls the AMAs, especially for remote or highly distributed companies.”

Borrowing from the wider world of consumer apps, its aim is to give users more control and thus make video meetings on the platform less abstract. Emoji reactions, background music, dynamic backgrounds, video bubbles, and a wide set of chat tools are among the bells and whistles that Venue believes will keep users interested, and keep organizations on board as customers.

Winning people over with bells and whistles seems to have worked so far. The startup says that there have been over 2 million emoji reactions “blasted to presenters” and that more than 30,000 one-on-one connections have been made between users on Venue to date.

Venue’s emergence from private beta is coming with some momentum for sure, but also — for the video call weary among us — maybe some malaise. Much of the world has inched away from many of the trappings of life in the throes of Covid-19 — local authorities are imposing less rules about face masks, travel and being in groups; offices are opening up again; and some of our e-commerce habits are tailing off in favor of shopping, eating out or doing other things in person.

Video conferencing hasn’t exactly died in recent months, but we are definitely entering a more sober phase after the heady months of 2020 and 2021. Even Zoom has felt the pinch. Although the company met analyst expectations for revenues and beat on earnings in its last financial quarter, it’s been feeling the pinch of a tough market for tech stocks.

Most recently, Citi downgraded Zoom’s stock in the face of growing competition from bigger platforms (Microsoft being especially aggressive with business customers, picking up some interesting partners in the process such as Workplace, the enterprise version of Facebook from Meta), and Zoom itself has been working on a new strategy to double down once more on its bread-and-butter enterprise base after finding that monetizing all those dinner parties and calls among friends was going nowhere fast.

All of that means not just a trickier climate for all video conferencing apps, but also a lot more competition for smaller players among those bigger companies with the resources to build in the tools they lack today.

But although many work practices, including remote working and virtual meetings, definitely opened up in the last couple of years, Goldlist points out that the use case for better, larger team meetings is not something that materialized during / after Covid-19. He points specifically to the costs and clunky nature of traditional video conferencing systems.

“The price of running an all-hands [for a company with employees in more than one place] is extraordinary,” he said. Doing “back of the napkin math”, said Goldlist, the cost for a meeting for 1,000 people for an hour is upwards for $50,000. That is not equipment investments per se. “it’s a huge cost to interrupt people in the middle of the day to have a meeting,” he said. “These are expensive things. You need to make them unique.”

The fact that there are still so many moments when video meetings don’t feel ideal is likely a strong enough reason for investors to place a bet on one in an early stage that has picked up some users, and is seeing some momentum with the wider startup community.

“Too often all hands and large meetings are inefficient and costly. Historically, it’s been hard to produce highly engaging meetings for large groups – the tools and technology hasn’t supported it. But Venue is now making top-tier production value simple and accessible,” said Sara Ittelson, a partner at Accel, in a statement.

August 12, 2022

Felicis, Lux Capital and Upfront Ventures tackle TAM at Disrupt

Perception is everything — especially when it comes to the value of software startups and total addressable markets (TAM). During 2020 and 2021, as COVID bit into the economy, tech products turned out to be more recession-resistant than expected. What’s more, tech companies grew faster than previously anticipated.

Those conditions combined to make TAM feel huge last year, which, in turn, led investors to pay far more for startup shares, calculated against their existing revenues. However, the growth rates of companies that caught a demand tailwind from COVID have dropped sharply, meaning that some TAM expectations were, perhaps, misplaced.

Where does that leave startups trying to measure their TAM today? Exploring the answer to that question is just one reason we’re thrilled that Kara Nortman, managing partner at Upfront Ventures; Aydin Senkut, founder and managing partner of Felicis Ventures; and Deena Shakir, a partner at Lux Capital, will join us onstage at TechCrunch Disrupt on October 18–20.

In a conversation called “Taking the BS Out of Your TAM,” these three experts will discuss how founders and investors should think about TAM and readjust their perceptions to avoid deluding themselves or their colleagues.

Kara Nortman is a managing partner at Upfront Ventures. Her portfolio includes investments in Parachute Home, Time by Ping, Endgame, Writer, Open Raven, Britive and Fleetsmith (acquired by Apple in 2020).

Prior to joining Upfront, Nortman co-founded Moonfrye, a children’s e-commerce company. She also spent seven years at IAC, where she co-led the M&A group, oversaw the initial investment in Tinder, and served as SVP and GM of Urbanspoon and Citysearch.

Nortman, a founding member of All Raise — a VC-led group dedicated to increased diversity in funders and founders — is also a founder of LA’s professional women’s soccer team, Angel City Football Club.

Aydin Senkut, the founder and managing partner of Felicis Ventures, is a super-angel turned multistage investor. Senkut has appeared on Forbes’ Midas List nine times and on the New York Times’ Top 20 Venture Capitalists list four times.

Since founding Felicis in 2006, he has earned notoriety as an early backer of iconic companies, including Credit Karma (acquired by Intuit), Fitbit, Guardant Health, Guideline, Notion, Opendoor, Pluralsight, Rovio, Shopify and Soundhound. Currently, his areas of focus include infrastructure, security and the future of health.

Deena Shakir is a partner at Lux Capital, where she seeks out extraordinary, mission-driven founders and invests in transformative technologies that improve lives and livelihoods.

Her portfolio investment areas include women’s health (Maven Clinic, Alife, Gameto, Adyn), digital health infrastructure (SteadyMD, H1, AllStripes, Everly Health), health equity (Waymark, Galileo, Miga), food tech (Shiru) and fintech (Mos, Ramp, Neo.Tax).

Prior to Lux, Shakir was a partner at GV, where she led product partnerships at Google (for health, search and AI/ML) and directed social impact investments at Google.org. As a Presidential Management Fellow at the U.S. Department of State, Shakir helped launch President Barack Obama’s first Global Entrepreneurship Summit.

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August 10, 2022

With a €43M EU grant and €1.2M from a VC, this startup plans to turn CO2 emissions into gold

The global problem of an over-abundance of CO2 in the atmosphere is ongoing, and a huge area that needs to be addressed, given the amount pumped out by industry. It’s hoped that if carbon dioxide could be converted at the point of emission, we could deal with the climate crisis a lot faster and create a sustainable carbon economy.

There are a few companies trying to tackle this. Zurich-based Climeworks is capturing CO2 from the air via commercial carbon dioxide removal technology, and has raised $784M so far. US-based Lanzatech is doing something similar, turning turning carbon into feedstock. It has raised $310.4M.

Now Copenhagen-based BioTech company SecondCircle thinks it also has a novel approach.

It claims to be able to capture CO2 from industrial emitters at the point of emission using ‘synthetic biology’ to develop biocatalysts (bacteria). These then convert the carbon dioxide into chemical compounds that are sold back to industry. If it cane be scaled-up, this could turn even emissions into a revenue opportunity.

The company has now closed a €1.2M Pre-Seed round led by Berlin-based early stage investor Atlantic Labs. But it has a lot more to play with than that. It also has a €43m EU grant to scale-up the process, as it is part of a consortium which received cash from the EU’s Horizon 2020 research and innovation programme. Dubbed “PyroCO2” the project aims to demonstrate the large-scale conversion of industrial carbon emissions into value-added chemicals and materials.

SecondCircle founders

Torbjørn Ølshøj Jensen, co-founder and CEO of SecondCircle said in a statement: “We strongly believe that we can only solve the global CO2 problem by building new approaches for sustainable value creation from inevitable emissions.”

Synthetic biology’ technology is already starting to be widely applied in a number of areas. SecondCircle spun out of the Biosustain NNF Center for Biosustainability at the Danish Technical University. Founded in 2020 and based in Copenhagen, the company is run by the founding team Alex Toftgaard Nielsen, Stephanie Redl, Torbjørn Ølshøj Jensen.

“By capturing carbon at the source and converting it into highly valuable products, SecondCircle has the potential to reduce customers’ emissions and simultaneously turn the unit economics of carbon capture on its head by finally having a profitable use case. Supporting this team was a no brainer for us,” added Max Kufner, Principal at Atlantic Labs.

August 5, 2022

Beacon Power Services raises $2.7M to improve electricity access for sub-Saharan African cities

Sub-Saharan Africa’s share of the global population without access to electricity stood at 77% in 2020, according to reports. Also, the average daily electricity supply in some of Africa’s largest cities is less than 12 hours. As a result, individuals and businesses find other options and substitutes, such as generators, to deal with their power issues; however, these solutions can either be costly to use or affect the climate.

While solar grids and panels are another viable option and have compelling use cases for end consumers, there’s still an opportunity to launch products targeted at power distribution companies, and that’s where Beacon Power Services (BPS) plays. The energy tech company, which provides data and grid management solutions to help Africa’s power sector distribute electricity more efficiently, is announcing today that it has closed a seed round of $2.7 million.

Founder and chief executive officer Bimbola Adisa, an aerospace engineer, started the company in 2014 after working several years for a power turbine manufacturer and as an investment banker covering the power sector in the U.S. For the latter, most of his clients included electric utilities, service providers and manufacturers. In an interview with TechCrunch, he said these experiences gave him exposure to the application of technology in the power sector, and he saw an opportunity to apply that in Nigeria and across Africa.

Adisa launched BPS in 2014 to address the inadequate electricity supply from power distribution companies. The U.S.- and Nigeria-based utility company provides energy management software and analytics for utilities. Its AI-enabled grid management platform, Adora, solves one of two fundamental problems power distribution companies face in Africa.

The software offers real-time visibility on network performance for electric utilities and connects to every utility asset and customer node on the grid, allowing energy providers to preempt outages and identify network losses, respond to them quickly and distribute electricity more efficiently. “The result is that utilities can operate more efficiently, recover more revenue, and by reducing outages, customers get increased supply of electricity (more hours supplied daily), so everyone wins,” said BFS in an emailed response to TechCrunch on how Adora works.

The other problem is data-focused, tackled by the company’s proprietary platform called Customer and Asset Information Management system (CAIMs). Utilities in Africa struggle to maintain an accurate database of their customers, assets and grid topology (the relationship between assets and customers). The CAIMs solves this by factoring in the unique conditions within which Africa’s utilities operate, for example, poor address systems, and helps them digitize their data, which serves as a foundation for network improvements.

“Africa is home to the fastest growing cities in the world, but when most people think of energy access in Africa, they think of the rural areas with little or no access to electricity at all. However, it is impossible for Africa to develop without significantly improving electricity access and reliability across its major cities,” said CEO Adisa in a statement. “When we realized that solutions designed for mature markets fail to address the unique infrastructure challenges Africa faces, we developed a tailored solution for power companies on the continent to improve daily grid supply of electricity.”

Bim Adisa (CEO)

Adisa told TechCrunch that BPS has grown from a single utility in Nigeria to four utilities in two countries, including Ghana, covering more than 8 million customers (residential and businesses). BPS’ business model entails working with its clients as partners over the long term, and not just to sell products, said Adisa. As such, the company can defer most of the upfront cost of deploying its technology in exchange for service-based payments commensurate with the value it creates.

The eight-year-old energy utility company says it differs from other platforms because it provides “local solutions that factor in the local operating environment in Africa.” For instance, most off-the-shelf solutions created for mature markets do not factor in the frequency of outages encountered in Africa or the network communications issues experienced, but BPS claims its solutions have solved that.

The company’s seed round was led by Seedstars Africa Ventures with participation from Persistent Energy, Kepple Africa Ventures, Factor[e] and Oridun Capital Management. Speaking on the investment, Maxime Bouan, managing partner at Seedstars Africa Ventures, said, “As a society, we have recognized climate change as one of the biggest threats to our generation, and it is critical we use smart capital to support entrepreneurs across Africa who are creating innovative and localized solutions to tackle this challenge.”

The new funding would enable BPS to improve its current products (product upgrades to add new features and incorporate automation) and expand into new markets beyond Nigeria and Ghana, where it currently operates.

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