CRV’s Saar Gur wants to invest in a new wave of games built for VR, Twitch and Zoom

Saar Gur is adept at identifying the next big consumer trends earlier than most: The San Francisco-based general partner at CRV has led investments into leading consumer internet companies like Niantic, DoorDash, Bird, Dropbox, Patreon, Kapwing and ClassPass.

His own experience stuck at home during the COVID-19 pandemic spurred his interest in three new investment themes focused on the next generation of games: those built for VR, those built on top of Twitch and those built for video chat environments as a socializing tool.

TechCrunch: We’ve been in a “VR winter,” as it’s been called in the industry, following the 2014-2017 wave of VC funding into VR drying up as the market failed to gain massive consumer adoption. You think VR could soon be hot again. Why?

Saar Gur: If you track revenues of third-party games on Oculus, the numbers are getting interesting. And we think the Quest is not quite the Xbox moment for Facebook, but the device and market response to the Quest have been great. So we are more engaged in looking at VR gaming startups than ever before.

What do you mean by “the Xbox moment,” and what will that look like for VR? Facebook hasn’t been able to keep up with demand for Oculus Quest headsets, and most VR headsets seem to have sold out during this pandemic as people seek entertainment at home. This seems like progress. When will we cross the threshold?

After closing its $2.2 billion latest tech fund, KKR adds top Cisco exec to its leadership team

KKR, the multibillion dollar multistrategy investment firm, is beefing up its technology practice with the appointment of Rob Salvagno as a co-head of its technology growth equity business in the U.S. 

It’s a sign that KKR is taking the tech industry seriously as it looks for new acquisition and investment opportunities.

Salvagno, the former vice president of corporate development and head of Cisco Investments, was responsible for all mergers and acquisitions and venture capital investments at the company.

Over a twenty-year career Salvagno helped form and launch Decibel, the networking giant’s early stage, several hundred million dollar investment fund.

“Our business has evolved significantly since we first launched our technology growth equity strategy over five years ago with a small team of five. Since that time, the growth of our business and the number of compelling investments we’re seeing around the globe have allowed us to not only expand our team, but also our technology experience, network and geographic reach,” said Dave Welsh, KKR Partner and Head of Technology Growth Equity, in a statement. “With the addition of a tech industry veteran like Rob to our team, we’re excited to continue to build for the future and position ourselves well to capture the many investment opportunities we see ahead.” 

To date, KKR has invested $2.7 billion in tech companies since 2014 and established itself as a player in late stage tech investment with a team of nineteen investment professionals. Earlier this month, the firm closed its $2.2 billion fund dedicated to growth technology investment in North America, Europe and Israel.

“Rob has an extensive background in security, [infrastructure] software and app dev and dev ops, a background which we believe will complement the existing teams’ skillset very well,” said Welsh in an email. “[And] our focus areas for our second firm will be similar to the prior fund, namely a heavy focus on software with some additional focus on consumer internet, fintech/insurtech and tech enabled services.”

Application development software and security technologies will also remain a core focus for the firm, according to Welsh.

“Additionally, we will be ramping up our time spent on infrastructure software (i.e. software used to run modern data center / cloud environments), application dev and development operations (i.e. app dev and dev ops solutions) as well as software solutions focused on certain vertical industries (such as real estate, legal, construction, hospitality),” the KKR co-head wrote in an email.

Opera’s Africa fintech startup OPay gains $120M from Chinese investors

Africa focused fintech startup OPay has raised a $120 million Series B round backed by Chinese investors.

Located in Lagos and founded by consumer internet company Opera, OPay will use the funds to scale in Nigeria and expand its payments product to Kenya, Ghana and South Africa — Opera’s CFO Frode Jacobsen confirmed to TechCrunch.

Series B investors included Meituan-Dianping, GaoRong, Source Code Capital, Softbank Asia, BAI, Redpoint, IDG Capital, Sequoia China and GSR Ventures.

OPay’s $120 million round comes after the startup raised $50 million in June.

It also follows Visa’s $200 million investment in Nigerian fintech company Interswitch and a $40 million raise by Lagos based payments startup PalmPay — led by China’s Transsion.

There are a couple quick takeaways. Nigeria has become the epicenter for fintech VC and expansion in Africa. And Chinese investors have made an unmistakable pivot to African tech.

Opera’s activity on the continent represents both trends. The Norway based, Chinese (majority) owned company founded OPay in 2018 on the popularity of its internet search engine.

Opera’s web-browser has ranked No. 2 in usage in Africa, after Chrome, the last four years.

The company has built a hefty suite of internet-based commercial products in Nigeria around OPay’s financial utility. These include motorcycle ride-hail app ORide, OFood delivery service, and OLeads SME marketing and advertising vertical.

“Opay will facilitate the people in Nigeria, Ghana, South Africa, Kenya and other African countries with the best fintech ecosystem. We see ourselves as a key contributor to…helping local businesses…thrive from…digital business models,” Opera CEO and OPay Chairman Yahui Zhou, said in a statement.

Opera CFO Frode Jacobsen shed additional light on how OPay will deploy the $120 million across Opera’s Africa network. OPay looks to capture volume around bill payments and airtime purchases, but not necessarily as priority.  “That’s not something you do ever day. We want to focus our services on things that have high-frequency usage,” said Jacobsen.

Those include transportation services, food services, and other types of daily activities, he explained. Jacobsen also noted OPay will use the $120 million to enter more countries in Africa than those disclosed.

Since its Series A raise, OPay in Nigeria has scaled to 140,000 active agents and $10 million in daily transaction volume, according to company stats.

Beyond standing out as another huge funding round, OPay’s $120 million VC raise has significance for Africa’s tech ecosystem on multiple levels.

It marks 2019 as the year Chinese investors went all in on the continent’s startup scene. OPay, PalmPay, and East African trucking logistics company Lori Systems have raised a combined $240 million from 15 different Chinese actors in a span of months.

OPay’s funding and expansion plans are also harbinger for fierce, cross-border fintech competition in Africa’s digital finance space. Parallel events to watch for include Interswitch’s imminent IPO, e-commerce venture Jumia’s shift to digital finance, and WhatsApp’s likely entry in African payments.

The continent’s 1.2 billion people represent the largest share of the world’s unbanked and underbanked population — which makes fintech Africa’s most promising digital sector. But it’s becoming a notably crowded sector where startup attrition and failure will certainly come into play.

And not to be overlooked is how OPay’s capital raise moves Opera toward becoming a multi-service commercial internet platform in Africa.

This places OPay and its Opera-supported suite of products on a competitive footing with other ride-hail, food delivery and payments startups across the continent. That means inevitable competition between Opera and Africa’s largest multi-service internet company, Jumia.

 

 

 

 

 

A new era for enterprise IT

Amidst the newly minted scooter unicorns, ebbs and flows of bitcoin investments, and wagers on the price of Uber’s IPO, another trend has shaken up the tech industry: the explosion of enterprise software successes.

Bessemer notes that today there are 55 private companies valued at $1 billion or more compared to zero a decade ago. Proving this isn’t just private market hype, enterprise cloud companies have well-exceeded $500 billion in market cap and are on a path to hit $1 trillion in the next few years. Whether it’s the masterfully executed IPOs of Zoom and PagerDuty, and the imminent Slack IPO, or the mega funding rounds of companies like Asana, and Airtable, Front, and many others, the insatiable demand for enterprise cloud deals shows that the new era of IT is no longer a zero sum game.

Back when we started Box in 2005, we saw a disruption on the horizon that would change enterprise software as we knew it.Led by the same trends that were impacting the consumer internet — growth of mobile, faster web-browsers, more users connected online — combined with the advent of the cloud, enterprises in every industry are forced to transform in the digital age. But we could barely have imagined the scale of change to come.

A Tipping Point for Best-of-Breed IT

Today’s enterprise software market doesn’t look like the enterprise software of the past. For one, the market is much larger. Deploying software in the on-prem world required a team of highly trained professionals and a hefty budget. By lowering costs and and removing adoption hurdles, the cloud expanded the market from millions to billions of people globally and in turn, businesses are using more apps than ever before. In fact, Okta found in their latest Business @ Work Report that large enterprises are deploying 129 apps on average. It’s therefore no surprise that software spend is expected to reach more than $420 billion in 2019 as the shift to the cloud marches on.

With a market of that magnitude, enterprise IT no longer can be controlled by just a handful of vendors, as we saw in the 90’s. And what what were once solved problems in a prior era of IT are now unsolved relative to rapidly changing user and buyer expectations in the cloud, leaving the door open for new disruptors to emerge and solve this problem better, faster, and with more focused visions.

Previously pesky problems like alerting ops teams to technical issues have turned into an entire platform for real-time operations, leading to PagerDuty’s $3 billion valuation in the process.

Everyone thought video conferencing was a tired market but Zoom proved that with extreme focus and simple user-experience its team could build a company worth over $15 billion. Atlassian has generated $25 billion in value by building a portfolio of modern development and IT tools that power a digital enterprise.

Slack has shown that real-time communication and workflow automation can be reinvented yet again. And making this approach work seamlessly are services like Okta, which is valued at $10 billion today.

In all of these cases, “best-of-breed” platforms are growing rapidly in their respective markets, with near limitless size and potential. And as processes for every every team, department, business, and industry can now be digitized, and we’ll continue to see this play out in every category of technology.

If the move from mainframe and mini-computers to PC saw a 10X increase in applications and software, the move from PC to cloud and mobile will see an order of magnitude more.

From IT stacks to cloud ecosystems

We’ve reached a new era of enterprise software and companies are coming around to this model in droves.
What seemed unfathomable merely a decade ago is now becoming commonplace as Fortune 500 companies are mixing and matching best-in-class technologies — from upstarts to cloud mainstays like Salesforce, Workday, and ServiceNow — to power their business. But there’s still work to do.

To ensure customers get all the benefits of a best-of-breed cloud ecosystem, these tools must work together without requiring the customer to stitch systems together manually. Without interoperability and integration, enterprises will be left with siloed data, fragmented workflows and security gaps in the cloud. In a legacy world, the idea of deep integration between software stacks was great on paper, but near impossible in practice. As Larry Ellison described in Softwar, customers were left footing the bill for putting together independent technology themselves. But the rules have changed with today’s generation of API-native companies with open cultures and a deep focus on putting the customer first.

Notably, even the largest players — IBM, Microsoft, Google, Cisco, and others — have recognized this tectonic shift, a harbinger of what’s to come in the industry. Satya Nadella, in taking over Microsoft, recognized the power of partnerships in a world where IT spend would be growing exponentially, telling Wired:

…instead of viewing things as zero sum, let’s view things as, ‘Hey, what is it that we’re trying to get done? What is it that they’re trying to get done? Places where we can co-operate, let’s co-operate.’ And where we’re competing, we compete.

As Peter Sole, former head of the Research Board, points out, in this digital world we can no longer think about a few vendors owning layers in a stack but instead as an ecosystem of multiple services working together to deliver value to the entire network. The incumbents that successfully thrive in the digital age will be those that despite their scale, work and operate like the nimbler, customer-obsessed, more open disruptors.  And those that don’t will face a reckoning from customers that now have choice to go a different direction for the first time.

Gone are the days of monolithic IT stacks and zero sum thinking; this is the new normal. Welcome to a new era of enterprise IT.

Unpacking Pinterest’s IPO expectations

For seven years, Pinterest has been considered a “unicorn,” boasting a valuation larger than $1 billion since its 2012 Series C funding round. Before that, it was considered an underdog, puzzling some investors with its “digital pinboard” and preference for “quality growth.”

Now, as the company takes its final step toward its Thursday NYSE initial public offering, it’s being called an “undercorn.”

Pinterest plans to sell shares of its stock, titled “PINS,” at $15 to $17 apiece, less than the roughly $21 per share it charged private market investors to participate in its mid-2017 Series H, its last private financing. That IPO price translates into a mid-range valuation of $10.64 billion, or nearly $2 billion under the $12.3 billion valuation it garnered after its last round, hence “undercorn.”

There are many potential causes to a down round like this. In the case of Pinterest, it’s probably less a result of newly public Lyft’s poor performance on the stock market and more a result of its own reputation for slow growth. Pinterest is a disciplined company that’s carved a clear path to profitability. It has invested a lot of time and energy into building a positive, diverse culture and a product devoid of trolls and hate speech — time some believe should have been spent focused on rapid growth and scale.

Sure, if Pinterest had tossed its values aside and blitzscaled, maybe it would debut with a larger initial market cap, but its corporate culture will be key to its long-term value, and investors are going to get rich off its IPO either way. So Pinterest is an undercorn — who cares?

Pinterest isn’t too nice

Ben Silbermann, chief executive officer of Pinterest. Photographer: Yana Paskova/Bloomberg via Getty Images

Founded in 2010, Pinterest is one of the youngest members of the newly dubbed “A-PLUS” cohort of unicorns, made up of Airbnb, Pinterest, Lyft, Uber and Slack. Compared to its peers, Pinterest has raised a modest $1.47 billion in equity funding from Bessemer Venture Partners, which holds a 13.1 percent pre-IPO stake, FirstMark Capital (9.8 percent), Andreessen Horowitz (9.6 percent), Fidelity Investments (7.1 percent) and Valiant Capital Partners (6 percent), according to the company’s IPO filing.

Today, Pinterest counts more than 250 million monthly active users, despite a company culture that many have said has slowed progress. Co-founder and chief executive officer Ben Silbermann, as The New York Times pointed out in a recent profile, is not your typical unicorn CEO. He has refused to adopt the move fast and break things mentality, and shied away from the press and focused on “quality growth” and a supportive company culture.

Even with Pinterest’s new status as an undercorn, Bessemer still owns a stake worth upwards of $1 billion. At a midpoint price, FirstMark and a16z’s shares will be worth about $700 million each. Pinterest employees may be too nice to make decisions as quick as other unicorns, as is the claim in CNBC’s recent piece on the company, but the company wouldn’t be where it is today if it completely lacked a “strategic direction.”

“Being nice and having core values and making decisions with intent is to their overall benefit,” Eric Kim, the co-founder of consumer tech investment firm Goodwater Capital, told TechCrunch. “They’ve done an amazing job at being very disciplined with a focus on top lines.”

IPO prospects

More often than not, businesses accrue value at IPO. Look at Zoom, for example; the under-the-radar video conferencing business is expected to increase its valuation nine times over in its IPO, expected tomorrow.

It’s a disappointment to late-stage investors when the opposite happens for one obvious reason: They may not see a return on their investment. If Pinterest indeed becomes an undercorn next week, the new investors that participated in its Series H may have to hold on to their stock longer than planned in hopes its value climbs over time. That, right there, is the worst thing about being an undercorn. These titles are otherwise just nonsense.

Pinterest’s valuation has long radically exceeded its revenues — a factor that surely paved the way for a down round — yet it was touted as a tech marvel, a unicorn among unicorns. In recent years, its valuation has swelled from $4.75 billion in 2014 to $10.47 billion in 2015 to, finally, $12.3 billion in 2017. Meanwhile, Pinterest posted revenues of $299 million in 2016, $473 million in 2017 and $756 million in 2018. There’s no denying the company’s clear path to profitability, as its losses are shrinking year-over-year while profits grow, but 2018’s revenues are still 16 times less than Pinterest’s “decacorn” valuation.

Silicon Valley has a tendency to over-value unprofitable consumer-facing businesses; Pinterest’s down round IPO could be a sign of Wall Street’s reckoning with Silicon Valley’s vanity metrics. Pinterest, however, isn’t the first unicorn to take a hit to its valuation at IPO. Both Box, the cloud-based content management platform, and payments company Square were undercorns when they went public, for example. Square has since thrived as a public company, while Box is currently trading around its initial share price.

“The recovery is all about execution as a public company when everything is much more transparent,” Monique Skruzny, CEO of InspIR Group, an advisory firm focused on investor relations, told TechCrunch. “The IPO is the beginning of a company’s long-term relationship with the public markets and the public markets have to make money. Going public at a valuation that may not necessarily be what some might think or consider to be the top leaves room for upside going forward.”

For Pinterest, continuing to cut losses and surpassing $1 billion in revenue this year is key. Given its history, financial metrics and the generally favorable market conditions, it looks poised to make that happen.

The bottom line is Pinterest, given its slow growth and inflated valuation, was probably always doomed to be nicknamed an undercorn. Its culture, however, shouldn’t be to blame for its new status. After all, a $10 billion IPO is something for the tech industry to be proud of, not to criticize.

In the words of former investor and Evernote co-founder Phil Libin, who joined me on the Equity podcast last week to talk IPOs: “Who would criticize a company who sacrifices growth because they have important culture? Losers, honestly.”

“If they didn’t have the culture and the people they wouldn’t have made anything,” he added.

Startups Weekly: What’s up with YC? Plus, mobility layoffs and Airbnb’s grand plans

Where to begin… Netflix darling Marie Kondo is hitting up Sand Hill Road in search of $40 million to fund an ecommerce platform, Y Combinator is giving $150,000 to a startup building a $380,000 flying motorcycle (because why not) and Jibo, the social robot, is calling it quits, speaking to owners directly of its imminent shutdown.

It was a hectic week in unicorn land so, I’m just going to get right to the good stuff.

Changes at Y Combinator

Where to begin! Not only did the prolific accelerator announce long-time president Sam Altman would be making an exit, but TechCrunch scooped the firm’s decision to move its headquarters to San Francisco. Y Combinator is going through a number of changes, outlined here. Interestingly, sources tell TechCrunch that YC has no succession plans. We’re guessing that’s because Altman had already mostly transitioned away from the firm, with CEO Michael Seibel assuming his responsibilities. The question is, is Altman planning to launch a startup? Hmmmmm.

Airbnb’s a hotelier

As it gears up for an IPO, Airbnb is showing its mature side. In a bid to accelerate growth, the home-sharing unicorn is buying HotelTonight in a deal said to be valued at around $465 million. Accel, the storied venture capital firm, was the business’s first-ever investors and is now its largest stakeholder. Oughta be a nice return. We’re still wondering whether it’s a cash deal, a cash and stock deal or an all-stock deal. Let me know if you’ve got the deets.

Mobility cuts

Lyft is preparing for its imminent IPO by getting lean. The ride-hailing company is trimming 50 staff members in its scooters and bikes unit, reports TechCrunch’s Ingrid Lunden. The cuts are mostly impacting those who joined the company when it acquired the electric bike-sharing startup Motivate, a deal that closed about three months ago. I’ll point out that Lyft employs 5,000 people; these layoffs are about one percent of their total workforce. And while we’re on the topic of mobility layoffs, Mobike, the former Chinese bike-share unicorn, is closing down all international operations and putting its sole focus on China.

Munchery goes bankrupt

Several weeks after a sudden shutdown left customers and vendors in the lurch, meal-kit service Munchery has filed for bankruptcy. In the Chapter 11 filing, Munchery chief executive officer James Beriker cites increased competition, over-funding, aggressive expansion efforts and Blue Apron’s failed IPO as reasons for its demise. Here’s the story, complete with Munchery’s bankruptcy filing.

Funders fundraise

This week Precursor Ventures closed its sophomore pre-seed fund on $32 million, NEA filed to raise its largest venture fund yet ($3.6 billion), SoftBank raised $2 billion on a $5 billion target for a Latin America Fund, aMoon raised $660 million for Israeli healthcare deals and Coral Capital brought in $45 million to make early-stage investments in Japan.

Here’s your weekly reminder to send me tips, suggestions and more to kate.clark@techcrunch.com or @KateClarkTweets

Startup cash

Sea is raising up to $1.5B
Grab confirms $1.46B investment from SoftBank’s Vision Fund
Music services company Kobalt is raising roughly $100M
Eargo raises $52M for virtually invisible, rechargeable hearing aids
Matterport raises $48M to ramp up its 3D imaging platform
Netflix star and tidying expert Marie Kondo is looking to raise $40M
Blueground raises $20M for flexible apartment rentals

Netflix star and tidying expert Marie Kondo

A16z gets even bigger

Andreessen Horowitz tapped David George as its newest general partner and its first top dealmaker focused on late-stage deals. George joins from General Atlantic, where he’d backed consumer internet, enterprise software and fintech startups as a principal since 2012. The firm’s swelling team is amongst the largest of any VC firm. Most partnerships consist of one to three top dealmakers and a few partners or principals. A16z breaks the mold with its ever-expanding team of GPs. We talked to George and a16z managing director Scott Kupor.

Worth reading

The Khashoggi murder isn’t stopping SoftBank’s Vision Fund, by TechCrunch’s Jon Russell and Jonathan Shieber.

SXSW

Stopping by SXSW? Meet TechCrunch’s writers at our annual Crunch By Crunch Fest party in Austin, Texas. RSVP here to join us on Sunday, March 10th from 1pm to 4pm at the Swan Dive at 615 Red River St. @ E. 7th St., just 3 blocks from the convention center. Hang out with TechCrunchers and fellow readers, enjoy free drinks and check out a live performance by electro-RnB musician Elderbrook.  And check out the full line-up of TechCrunch panels here. I will be discussing the double standard in sex tech with Lora Haddock, the CEO of Lora DiCarlo, on Thursday, March 14th at 2pm at the Fairmont Congressional A, 101 Red River.

Listen to me talk

This week on Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines, Crunchbase New’s editor-in-chief Alex Wilhelm and I discuss Y Combinator’s new HQ, Chime’s big funding round and SoftBank’s new Latin America fund. Listen here.

Want more TechCrunch newsletters? Sign up here.

Startups Weekly: What’s up with YC? Plus, mobility layoffs and Airbnb’s grand plans

Where to begin… Netflix darling Marie Kondo is hitting up Sand Hill Road in search of $40 million to fund an ecommerce platform, Y Combinator is giving $150,000 to a startup building a $380,000 flying motorcycle (because why not) and Jibo, the social robot, is calling it quits, speaking to owners directly of its imminent shutdown.

It was a hectic week in unicorn land so, I’m just going to get right to the good stuff.

Changes at Y Combinator

Where to begin! Not only did the prolific accelerator announce long-time president Sam Altman would be making an exit, but TechCrunch scooped the firm’s decision to move its headquarters to San Francisco. Y Combinator is going through a number of changes, outlined here. Interestingly, sources tell TechCrunch that YC has no succession plans. We’re guessing that’s because Altman had already mostly transitioned away from the firm, with CEO Michael Seibel assuming his responsibilities. The question is, is Altman planning to launch a startup? Hmmmmm.

Airbnb’s a hotelier

As it gears up for an IPO, Airbnb is showing its mature side. In a bid to accelerate growth, the home-sharing unicorn is buying HotelTonight in a deal said to be valued at around $465 million. Accel, the storied venture capital firm, was the business’s first-ever investors and is now its largest stakeholder. Oughta be a nice return. We’re still wondering whether it’s a cash deal, a cash and stock deal or an all-stock deal. Let me know if you’ve got the deets.

Mobility cuts

Lyft is preparing for its imminent IPO by getting lean. The ride-hailing company is trimming 50 staff members in its scooters and bikes unit, reports TechCrunch’s Ingrid Lunden. The cuts are mostly impacting those who joined the company when it acquired the electric bike-sharing startup Motivate, a deal that closed about three months ago. I’ll point out that Lyft employs 5,000 people; these layoffs are about one percent of their total workforce. And while we’re on the topic of mobility layoffs, Mobike, the former Chinese bike-share unicorn, is closing down all international operations and putting its sole focus on China.

Munchery goes bankrupt

Several weeks after a sudden shutdown left customers and vendors in the lurch, meal-kit service Munchery has filed for bankruptcy. In the Chapter 11 filing, Munchery chief executive officer James Beriker cites increased competition, over-funding, aggressive expansion efforts and Blue Apron’s failed IPO as reasons for its demise. Here’s the story, complete with Munchery’s bankruptcy filing.

Funders fundraise

This week Precursor Ventures closed its sophomore pre-seed fund on $32 million, NEA filed to raise its largest venture fund yet ($3.6 billion), SoftBank raised $2 billion on a $5 billion target for a Latin America Fund, aMoon raised $660 million for Israeli healthcare deals and Coral Capital brought in $45 million to make early-stage investments in Japan.

Here’s your weekly reminder to send me tips, suggestions and more to kate.clark@techcrunch.com or @KateClarkTweets

Startup cash

Sea is raising up to $1.5B
Grab confirms $1.46B investment from SoftBank’s Vision Fund
Music services company Kobalt is raising roughly $100M
Eargo raises $52M for virtually invisible, rechargeable hearing aids
Matterport raises $48M to ramp up its 3D imaging platform
Netflix star and tidying expert Marie Kondo is looking to raise $40M
Blueground raises $20M for flexible apartment rentals

Netflix star and tidying expert Marie Kondo

A16z gets even bigger

Andreessen Horowitz tapped David George as its newest general partner and its first top dealmaker focused on late-stage deals. George joins from General Atlantic, where he’d backed consumer internet, enterprise software and fintech startups as a principal since 2012. The firm’s swelling team is amongst the largest of any VC firm. Most partnerships consist of one to three top dealmakers and a few partners or principals. A16z breaks the mold with its ever-expanding team of GPs. We talked to George and a16z managing director Scott Kupor.

Worth reading

The Khashoggi murder isn’t stopping SoftBank’s Vision Fund, by TechCrunch’s Jon Russell and Jonathan Shieber.

SXSW

Stopping by SXSW? Meet TechCrunch’s writers at our annual Crunch By Crunch Fest party in Austin, Texas. RSVP here to join us on Sunday, March 10th from 1pm to 4pm at the Swan Dive at 615 Red River St. @ E. 7th St., just 3 blocks from the convention center. Hang out with TechCrunchers and fellow readers, enjoy free drinks and check out a live performance by electro-RnB musician Elderbrook.  And check out the full line-up of TechCrunch panels here. I will be discussing the double standard in sex tech with Lora Haddock, the CEO of Lora DiCarlo, on Thursday, March 14th at 2pm at the Fairmont Congressional A, 101 Red River.

Listen to me talk

This week on Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines, Crunchbase New’s editor-in-chief Alex Wilhelm and I discuss Y Combinator’s new HQ, Chime’s big funding round and SoftBank’s new Latin America fund. Listen here.

Want more TechCrunch newsletters? Sign up here.

Lightspeed announces new $560 million fund for China

Global investor Lightspeed is starting 2019 with its largest-ever fund for China, where it has backed a number of new internet challengers. The firm announced this week that its fourth China fund has closed with a total capital commitment of $560 million.

The firm had a massive 2018, with no fewer than five of its portfolio holding IPOs including two of China’s up-and-coming startups that are challenging the country’s internet establishment — they are Meituan, the super app firm that specializes in deliveries, and Pinduoduo, a group e-commerce company that is threatening Alibaba’s dominance.

Based on those successes, it is perhaps not a surprise that Lightspeed has pulled in a record new fund. TechCrunch previously reported that the new fund was aimed at $360 million based on filings, but it added more capital to give more options.

Lightspeed said it has $360 million for early-stage deals aimed at Series A and Series B stages, with an additional $200 million set aside for “growth investments.” The new fund dwarfs Lightspeed’s previous vehicles in China — the firm’s previous two China funds each closed at $260 million while it raised $168 million for its debut fund in the country in 2013.

Lightspeed Venture Partners is a well-known investor that is anchored in Silicon Valley with global funds in India, Israeli and — of course — China. Together, those funds manage around $6 billion in capital, according to the firm.

Led by partners Chris Schaepe, Herry Han and James Mi, the China operation has backed a range of unicorns, including the aforementioned Meituan, which raised over $4 billion via a Hong Kong IPO last year, and Pinduoduo, which raised $1.6 billion via a U.S. listing in 2018. Other Lightspeed China IPOs from last year were PPDai, Rong360 and InnoLight while the firm also counts $9 billion-valued Full Truck Alliance, real estate platform Fangdd and Airbnb-like Tujia, both of which are valued in the billions, among the more mature bets in its portfolio.

“We believe there are plenty of new opportunities in China consumer Internet given the depth of China’s mobile payment and social networks. Innovation and entrepreneurship in the next decade will bring more China-based startups to the world stage. This will be China’s first decade of truly global innovation. Chinese entrepreneurs are now developing business plans with global expansion in mind from day one,” said Han, one of the firm’s founding partners, in a statement.

Last year, Lightspeed Venture Partners — the U.S. entity — filed to raise a record $1.8 billion in new capital commitments. In December, it added five new partners to its consumer and enterprise investment teams, including Slack’s former head of growth and Twitter’s former vice president of global business development.

Grab raises fundraising target to $5B as Southeast Asia’s ride-hailing war heats up

Southeast Asian ride-hailing firm Grab is aiming to start the new year with a bang and an awful load of bucks. The company, which acquired Uber’s local business earlier this year, is planning to raise as much as $5 billion from its ongoing Series H round, up from an original target of $3 billion, a source with knowledge of the plan told TechCrunch.

Grab declined to comment for this story.

That Series H round has been open since June. Already, it has seen participation from the likes of Toyota, Microsoft, Booking Holdings and Yamaha Motors who have pushed it close to the original $3 billion target. Prior to raising $150 million from Yamaha, Grab said the round stood at $2.7 billion. While it is true that the company first announced that it was “on track to raise over $3 billion by the end of 2018,” it is not public knowledge that it has set its sights as high as $5 billion.

A big part of that expansion is a planned investment from SoftBank’s Vision Fund which, as TechCrunch reported last week, is aiming to pump up to $1.5 billion into the business. Adding that to the $3 billion total appears to leave a further $500 million allocation for other investors to take up.

Grab is already the most capitalized startup in Southeast Asia’s history having raised around $6.8 billion to date from investors, according to data from Crunchbase. The company was last valued at $11 billion — when Toyota invested the initial $1 billion in this Series H six months ago — and it is unclear how much that valuation will increase when the round is completed.

The company is also one of the widest reaching consumer internet companies in Southeast Asia, a region of 650 million consumers. Grab claims over 130 million downloads and more than 2.5 billion completed rides to date, while it has expanded into fintech and it is going beyond ride-hailing app to offer Southeast Asia a ‘super app’ in the mold of Meituan in China. On the financial side, Grab is assumed to not yet be profitable. But it has said that it made $1 billion in revenue and that it projects that the figure will double in 2019.

Buying Uber’s business made it the dominant ride-sharing operator in the region — a position that saw it pay fines in Singapore and the Philippines — but Uber’s exit also saw Go-Jek, a rival in Indonesia, step up and expand its business into new markets. Go-Jek — which is backed by the likes of Tencent, Meituan and Google — entered Vietnam in August and it has recently launched in Thailand and Singapore as it bids to step into Uber’s shadow.

With Go-Jek aiming to raise $2 billion of its own, it certainly looks like Grab’s extension of its already-enormous Series H round is aimed at increasing its war chest as the competition intensifies in post-Uber Southeast Asia.