Tag: Recent Funding

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Cohere raises $3.1 million for its remote control solution for web apps

Existing remote desktop solutions like LogMeIn and TeamViewer can be complicated to set up and use, and can feel dated. A new startup called Cohere, now backed by $3.1 million in seed funding, aims to improve on the remote desktop and screen-sharing experience. With Cohere’s technology, businesses can help customers in seconds by taking instant control of their screen without any downloads or setup on the customer’s end.

That ease-of-use has already gained the startup over 50 paying customers for its product, including TechCrunch Disrupt 2020 winner Canix, CopyAI, Ramp and others. It also signed its first enterprise client with Podium.

Cohere’s three co-founders, Yunyu Lin, Jason Wang and Rahul Sengottuvelu, first met while attending Duke University. Lin later left to work for corporate card startup Ramp, but the others graduated during the pandemic.

And the winner of Startup Battlefield at Disrupt 2020 is… Canix

The idea for Cohere actually emerged during the pandemic, during a hackathon focused on remote work. The team won the event and decided to take their project to Y Combinator for further development.

Essentially, Cohere is designed to make it easier for teams, whether small founders or large enterprises, to help solve their customers’ issues. Instead of requiring a software download or complicated install process, customers can just click a button on a website to allow remote control of their screen. This can save time, as the support person on the other end doesn’t have to ask a million questions about which screen the customer is on or what they see, or direct them where to click — they can just take over.

“It lets you see what people are seeing just like that, with no setup,” says Sengottuvelu. “You can just show them — just like you’re sitting next to them.”

Image Credits: Cohere

But what makes Cohere different is it’s not a full remote desktop solution where the person on the other end is taking over someone’s computer — the service instead only forwards the contents of the individual web page the person is currently viewing. The application developer, that is, can only view what a user is doing on their own website. They can’t switch tabs or minimize the browser to poke around in the user’s PC more broadly.

“We don’t operate on the pixel level, like a normal screen share does, where they take a picture of your screen 60 times a second and try to send it over the wire,” explains Lin.

The startup’s technology itself is based on capturing the web page’s state — a picture of the DOM, so to speak, for those who understand the terminology. It then leverages things like MutationObservers and WebSockets to make it possible to quickly see changes to the web pages in real time. Cohere also spent time to make sure it works with a range of web technologies and frameworks, including React, Iframe, Canvas, Vue, Angular and others. In time, it wants to expand support to more platforms and technologies.

“We capture the content of the page,” Lin says. “So, we are able to selectively filter out sensitive information like credit card info, passwords or Social Security numbers — any personally identifiable information,” he adds.

Image Credits: Cohere

The remote viewer also can’t take control until the user accepts, and then the user can boot them at any time with a click of an “X” button at the top of the screen.

In addition to these security controls, Cohere is SOC 2 Type 1, GDPR and CCPA compliant.

At present, Cohere works on both desktop and mobile browsers, including Chrome, Firefox, Edge and Safari. And it’s designed to be integrated with a business’s existing tools, like Zendesk, Slack, Salesforce and Intercom, with more to come.

While the product to some extent competes with older remote desktop apps, its newer Cohere Replay feature allows businesses to go back in time to view their customer sessions retroactively.

Image Credits: Cohere

Because the product is limited to web apps and is not a full remote desktop solution it tends to be used primarily for things like customer support and user onboarding. Early-stage startups have also used it as they give tours to their first customers and learn from how the customers use the product in real time.

The paid service begins at $49 per user per month and is $39 for larger teams.

Cohere first launched around seven months ago, during its Y Combinator batch.

It’s now raised $3.1 million in seed funding, led by Initialized Capital. Other investors in the round include Y Combinator, BoxGroup, Soma Capital, Shrug Capital, Chapter One and various angels like Zach Perret, Elad Gil, Naval Ravikant, Eric Wu, Prasanna Sankaranarayanan, Eric Glyman, Jack Altman, Todd Goldberg, Rahul Vohra, Karim Atiyeh, Vivek Sodera, Dan Romero, Shrav Mehta and Oscar Hong.

New York-based Cohere, currently consisting only of the three co-founders, will use the additional funds to hire in sales, engineering and product. It will also devote some capital to building out the enterprise sales process, and expand its integrations and use cases.

How to convert customers with subscription pricing

 

 

Posted on

Cohere raises $3.1 million for its remote control solution for web apps

Existing remote desktop solutions like LogMeIn and TeamViewer can be complicated to set up and use, and can feel dated. A new startup called Cohere, now backed by $3.1 million in seed funding, aims to improve on the remote desktop and screen-sharing experience. With Cohere’s technology, businesses can help customers in seconds by taking instant control of their screen without any downloads or setup on the customer’s end.

That ease-of-use has already gained the startup over 50 paying customers for its product, including TechCrunch Disrupt 2020 winner Canix, CopyAI, Ramp and others. It also signed its first enterprise client with Podium.

Cohere’s three co-founders, Yunyu Lin, Jason Wang and Rahul Sengottuvelu, first met while attending Duke University. Lin later left to work for corporate card startup Ramp, but the others graduated during the pandemic.

And the winner of Startup Battlefield at Disrupt 2020 is… Canix

The idea for Cohere actually emerged during the pandemic, during a hackathon focused on remote work. The team won the event and decided to take their project to Y Combinator for further development.

Essentially, Cohere is designed to make it easier for teams, whether small founders or large enterprises, to help solve their customers’ issues. Instead of requiring a software download or complicated install process, customers can just click a button on a website to allow remote control of their screen. This can save time, as the support person on the other end doesn’t have to ask a million questions about which screen the customer is on or what they see, or direct them where to click — they can just take over.

“It lets you see what people are seeing just like that, with no setup,” says Sengottuvelu. “You can just show them — just like you’re sitting next to them.”

Image Credits: Cohere

But what makes Cohere different is it’s not a full remote desktop solution where the person on the other end is taking over someone’s computer — the service instead only forwards the contents of the individual web page the person is currently viewing. The application developer, that is, can only view what a user is doing on their own website. They can’t switch tabs or minimize the browser to poke around in the user’s PC more broadly.

“We don’t operate on the pixel level, like a normal screen share does, where they take a picture of your screen 60 times a second and try to send it over the wire,” explains Lin.

The startup’s technology itself is based on capturing the web page’s state — a picture of the DOM, so to speak, for those who understand the terminology. It then leverages things like MutationObservers and WebSockets to make it possible to quickly see changes to the web pages in real time. Cohere also spent time to make sure it works with a range of web technologies and frameworks, including React, Iframe, Canvas, Vue, Angular and others. In time, it wants to expand support to more platforms and technologies.

“We capture the content of the page,” Lin says. “So, we are able to selectively filter out sensitive information like credit card info, passwords or Social Security numbers — any personally identifiable information,” he adds.

Image Credits: Cohere

The remote viewer also can’t take control until the user accepts, and then the user can boot them at any time with a click of an “X” button at the top of the screen.

In addition to these security controls, Cohere is SOC 2 Type 1, GDPR and CCPA compliant.

At present, Cohere works on both desktop and mobile browsers, including Chrome, Firefox, Edge and Safari. And it’s designed to be integrated with a business’s existing tools, like Zendesk, Slack, Salesforce and Intercom, with more to come.

While the product to some extent competes with older remote desktop apps, its newer Cohere Replay feature allows businesses to go back in time to view their customer sessions retroactively.

Image Credits: Cohere

Because the product is limited to web apps and is not a full remote desktop solution it tends to be used primarily for things like customer support and user onboarding. Early-stage startups have also used it as they give tours to their first customers and learn from how the customers use the product in real time.

The paid service begins at $49 per user per month and is $39 for larger teams.

Cohere first launched around seven months ago, during its Y Combinator batch.

It’s now raised $3.1 million in seed funding, led by Initialized Capital. Other investors in the round include Y Combinator, BoxGroup, Soma Capital, Shrug Capital, Chapter One and various angels like Zach Perret, Elad Gil, Naval Ravikant, Eric Wu, Prasanna Sankaranarayanan, Eric Glyman, Jack Altman, Todd Goldberg, Rahul Vohra, Karim Atiyeh, Vivek Sodera, Dan Romero, Shrav Mehta and Oscar Hong.

New York-based Cohere, currently consisting only of the three co-founders, will use the additional funds to hire in sales, engineering and product. It will also devote some capital to building out the enterprise sales process, and expand its integrations and use cases.

How to convert customers with subscription pricing

 

 

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Squarespace raises $300M at staggering $10B valuation

Squarespace has raised $300 million in a round of funding that values the company at a staggering $10 billion valuation.

New backers include Dragoneer, Tiger Global, D1 Capital Partners, Fidelity Management & Research Company, funds and accounts advised by T. Rowe Price Associates, Inc. and Spruce House. Existing backers Accel and General Atlantic also participated. 

Squarespace Founder & CEO Anthony Casalena said the fresh capital will advance the company’s growth initiatives and help it scale its product suite.

The move comes less than two months after the company filed confidentiality to go public via a direct listing or initial public offering.

Squarespace, which has helped millions create their own websites, was founded in 2003 and bootsapped until a $38.5 million Series A in 2010 that was co-led by Accel and Index Ventures.

The online website creation and hosting service — which has now expanded into e-commerce — then raised another $40M round in 2014. But it is perhaps best known for its epic 2017-era $200 million secondary round that General Atlantic financed. 

New York City-based Squarespace has over 1200 employees spread across its headquarters and offices in Dublin, Ireland; Portland, Oregon and Los Angeles, California. 

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Socure raises $100M at $1.3B valuation, proving identity verification is hotter than ever

The COVID-19 pandemic has accelerated digital adoption in a way that no one could have ever anticipated, and as more people conduct more services online and via mobile devices, businesses have had to work even harder to validate users and security. One company working to serve that need, Socure – which uses AI and machine learning to verify identities – announced Tuesday that it has raised $100 million in a Series D funding round at a $1.3 billion valuation.

Given how much of our lives have shifted online, it’s no surprise that the U.S. digital identity market is projected to increase to over $30 billion by 2023 from just under $15 billion in 2019, according to One World Identity. This has led to skyrocketing demand for the services provided by identity verification companies. 

Historically, Socure has been focused on the financial services industry, but it plans to use its new capital to further expand into “every consumer-facing vertical” including online gaming, healthcare, telco, e-commerce, and on-demand services.

The startup’s predictive analytics platform applies artificial intelligence and machine-learning techniques with online/offline data intelligence (from email, phone, address, IP, device, velocity, and the broader internet) to verify that people are, in fact, who they say they are when applying for various accounts.

Today, Socure has more than 350 customers including three top five banks, six top 10 card issuers, a “top” credit bureau and over 75 fintechs such as Varo Money, Public, Chime, and Stash.

Accel led Socure’s latest financing, which included participation from existing backers Commerce Ventures, Scale Venture Partners, Flint Capital, Citi Ventures, Wells Fargo Strategic Capital, Synchrony, Sorenson, Two Sigma Ventures, and others. 

The round comes less than six months after the company raised $35 million in a round led by Sorenson Ventures, and brings the New York-based company’s total raised to $196 million since its 2012 inception.

Which neobanks will rise or fall?

Socure founder and CEO Johnny Ayers says his company’s identity management products can help B2C enterprises achieve know-your-customer (KYC) auto-approval rates of up to 97%. This means that financial institutions can more easily capture fraud, for example, via Socure’s single API. The company also claims that by more easily verifying thin-file (those without much credit history) and young consumers, it can help reduce the underbanked population.     

The company plans to use its new capital to also enhance its product offering as it continues to develop patents. 

Accel partner Amit Jhawar will join Socure’s board as part of the funding round.

In a blog post, Jhawar described Socure as “a purpose-built solution designed to handle the wave of new online users because its machine learning models have learned from every identity it has already seen.”

As former COO at Braintree and general  manager at Venmo, Jhawar knows a thing or two about the importance of identity verification, especially in the financial services space.

He wrote: “I knew immediately that the Socure solution would be a game-changer because the solution can be used in every step of the customer lifecycle, from account creation to login to transaction.”

Socure also has hinted that it has an IPO in its future.

In a written statement, Ayers said: “We are incredibly grateful for the chance to innovate and partner to solve this problem with some of the greatest companies in the world and are energized for the opportunities that lay ahead for Socure, especially as we make our march to a potential IPO.”

TechCrunch has reached out to Socure and will update this story with more details.

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Docker nabs $23M Series B as as new developer focus takes shape

It was easy to wonder what would become of Docker after it sold its enterprise business in 2019, but it regrouped last year as a cloud native container company focused on developers, and the new approach appears to be bearing fruit. Today, the company announced a $23 million Series B investment.

Tribe Capital led the round with participation from existing investors Benchmark and Insight Partners. Docker has now raised a total of $58 million including the $35 million investment it landed the same day it announced the deal with Mirantis .

To be sure, the company had a tempestuous 2019 when they changed CEOs twice, sold the enterprise division and looked to reestablish itself with a new strategy. While the pandemic made 2020 a trying time for everyone, Docker CEO Scott Johnston says that in spite of that, the strategy has begun to take shape.

“The results we think speak volumes. Not only was the strategy strong, but the execution of that strategy was strong as well,” Johnston told me. He indicated that the company added 1.7 million new developer registrations for the free version of the product for a total of more 7.3 million registered users on the community edition.

Docker regroups as cloud-native developer tool company

As with any open source project, the goal is to popularize the community project and turn a small percentage of those users into paying customers, but Docker’s problem prior to 2019 had been finding ways to do that. While he didn’t share specific numbers, Johnston indicated that annual recurring revenue (ARR) grew 170% last year, suggesting that they are beginning to convert more successfully.

Johnston says that’s because they have found a way to turn a certain class of developer in spite of a free version being available. “Yes, there’s a lot of upstream open source technologies, and there are users that want to hammer together their own solutions. But we are also seeing these eight-to-ten person ‘two pizza teams’ who want to focus on building applications, and so they’re willing to pay for a service,” he said.

That open source model tends to get the attention of investors because it comes with that built-in action at the top of the sales funnel. Tribe’s Arjun Sethi, whose firm led the investment, says his company actually was a Docker customer before investing in the company and sees a lot more growth potential.

“Tribe focuses on identifying N-of-1 companies — top-decile private tech firms that are exhibiting inflection points in their growth, with the potential to scale towards outsized outcomes with long-term venture capital. Docker fits squarely into this investment thesis[…],” Sethi said in a statement.

Johnston says as they look ahead to post-pandemic, he’s learned a lot since his team move out of the office last year. After surveying employees, they were surprised to learn that most have been happier working at home, having more time to spend with family, while taking away a grueling commute. As a result, he sees going virtual first, even after it’s safe to reopen offices.

That said, he is planning to offer a way to get teams together for in-person gatherings and a full company get-together once a year.

“We’ll be virtual first, but then with the savings of the real estate that we’re no longer paying for, we’re going to bring people together and make sure we have that social glue,” he said.

After selling enterprise biz, Docker lands $35M investment and new CEO

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Noogata raises $12M seed round for its no-code enterprise AI platform

Noogata, a startup that offers a no-code AI solution for enterprises, today announced that it has raised a $12 million seed round led by Team8, with participation from Skylake Capital. The company, which was founded in 2019 and counts Colgate and PepsiCo among its customers, currently focuses on e-commerce, retail and financial services, but it notes that it will use the new funding to power its product development and expand into new industries.

The company’s platform offers a collection of what are essentially pre-built AI building blocks that enterprises can then connect to third-party tools like their data warehouse, Salesforce, Stripe and other data sources. An e-commerce retailer could use this to optimize its pricing, for example, thanks to recommendations from the Noogata platform, while a brick-and-mortar retailer could use it to plan which assortment to allocate to a given location.

Image Credits: Noogata

“We believe data teams are at the epicenter of digital transformation and that to drive impact, they need to be able to unlock the value of data. They need access to relevant, continuous and explainable insights and predictions that are reliable and up-to-date,” said Noogata co-founder and CEO Assaf Egozi. “Noogata unlocks the value of data by providing contextual, business-focused blocks that integrate seamlessly into enterprise data environments to generate actionable insights, predictions and recommendations. This empowers users to go far beyond traditional business intelligence by leveraging AI in their self-serve analytics as well as in their data solutions.”

Image Credits: Noogata

We’ve obviously seen a plethora of startups in this space lately. The proliferation of data — and the advent of data warehousing — means that most businesses now have the fuel to create machine learning-based predictions. What’s often lacking, though, is the talent. There’s still a shortage of data scientists and developers who can build these models from scratch, so it’s no surprise that we’re seeing more startups that are creating no-code/low-code services in this space. The well-funded Abacus.ai, for example, targets about the same market as Noogata.

Five VCs discuss how no-code is going horizontal across the world’s industries

“Noogata is perfectly positioned to address the significant market need for a best-in-class, no-code data analytics platform to drive decision-making,” writes Team8 managing partner Yuval Shachar. “The innovative platform replaces the need for internal build, which is complex and costly, or the use of out-of-the-box vendor solutions which are limited. The company’s ability to unlock the value of data through AI is a game-changer. Add to that a stellar founding team, and there is no doubt in my mind that Noogata will be enormously successful.”

Abacus.AI raises another $22M and launches new AI modules

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Noogata raises $12M seed round for its no-code enterprise AI platform

Noogata, a startup that offers a no-code AI solution for enterprises, today announced that it has raised a $12 million seed round led by Team8, with participation from Skylake Capital. The company, which was founded in 2019 and counts Colgate and PepsiCo among its customers, currently focuses on e-commerce, retail and financial services, but it notes that it will use the new funding to power its product development and expand into new industries.

The company’s platform offers a collection of what are essentially pre-built AI building blocks that enterprises can then connect to third-party tools like their data warehouse, Salesforce, Stripe and other data sources. An e-commerce retailer could use this to optimize its pricing, for example, thanks to recommendations from the Noogata platform, while a brick-and-mortar retailer could use it to plan which assortment to allocate to a given location.

Image Credits: Noogata

“We believe data teams are at the epicenter of digital transformation and that to drive impact, they need to be able to unlock the value of data. They need access to relevant, continuous and explainable insights and predictions that are reliable and up-to-date,” said Noogata co-founder and CEO Assaf Egozi. “Noogata unlocks the value of data by providing contextual, business-focused blocks that integrate seamlessly into enterprise data environments to generate actionable insights, predictions and recommendations. This empowers users to go far beyond traditional business intelligence by leveraging AI in their self-serve analytics as well as in their data solutions.”

Image Credits: Noogata

We’ve obviously seen a plethora of startups in this space lately. The proliferation of data — and the advent of data warehousing — means that most businesses now have the fuel to create machine learning-based predictions. What’s often lacking, though, is the talent. There’s still a shortage of data scientists and developers who can build these models from scratch, so it’s no surprise that we’re seeing more startups that are creating no-code/low-code services in this space. The well-funded Abacus.ai, for example, targets about the same market as Noogata.

Five VCs discuss how no-code is going horizontal across the world’s industries

“Noogata is perfectly positioned to address the significant market need for a best-in-class, no-code data analytics platform to drive decision-making,” writes Team8 managing partner Yuval Shachar. “The innovative platform replaces the need for internal build, which is complex and costly, or the use of out-of-the-box vendor solutions which are limited. The company’s ability to unlock the value of data through AI is a game-changer. Add to that a stellar founding team, and there is no doubt in my mind that Noogata will be enormously successful.”

Abacus.AI raises another $22M and launches new AI modules

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Gumroad wants to make equity crowdfunding mainstream

Gumroad, a startup that helps creators sell their work, is raising $6 million at a $100 million valuation. While $1 million of that total is reserved for AngelList co-founder Naval Ravikant and Basecamp founder Jason Fried, the remaining $5 million is being raised with a twist: anyone willing to fork over at least $100 bucks can invest in the round.

Founded by Sahil Lavingia, Gumroad is using a new SEC regulation, passed today, that increases the maximum amount of money that can be raised in an equity crowdfunding campaign. Now, investors and founders can raise up to $5 million per year from crowdfunding, up from $1.07 million the year prior.

The increase might not turn heads in a world of $90+ billion valuations, but Lavingia thinks the new rules could revitalize a path to raising capital for venture capitalists and founders alike. Unaccredited investors — whether its users, friends or non-accredited investors — could become the new limited partners.

“If this works, startup founders will start to be able to go direct more frequently,” Lavingia said.

Despite venture capital growing as an asset class, alternative ways to raise are becoming increasingly popular to help founders maintain ownership and to access capital.

Up until this point, Gumroad has raised more than $8 million from investors, including Kleiner Perkins, First Round, Max Levchin and SV Angel, as well as others, since 2011. But today marks what Lavingia views as a long-term shift in how Gumroad raises capital. If all goes well, Gumroad will continue raising via crowdfunding on an annual basis until it goes public.

Now that companies can raise $5 million per year through crowdfunding, platforms like WeFunder, StartEngine, SeedInvest and Republic, which Lavingia is using, have a better chance to shake up the modern fundraise.

So far, Gumroad has raised $3.4 million of its $5 million goal across commitments from 3,458 investors. Investors in the crowdfund include part-time creators on Gumroad, Lavingia’s Twitter followers, YouTubers, as well as Figma founder Dylan Field and partners from VC firms. In order to promote a diversity of investors, Gumroad has capped total investments from individuals at $1,000 for the first few days.

A report card for the SEC’s new equity crowdfunding rules

The startup is giving up 6% of ownership as part of the financing event, and the investors will only receive equity stakes once the SAFE note turns into a round. This process could take a year, Lavingia said. The conversion round to make it happen could be an IPO, acquisition or $10 million priced round. The priced round will likely happen next year through a Reg A round, the annual limit of which is $75 million, the founder said.

The SAFE’s cap is placed at a present-day 3.5x revenue multiple. In 2020, Gumroad brought in $9.2 million in net revenue, up 87% from the year prior, generating $1.08 million in net profit, up 286% from the year prior.

Background

The new, higher crowdfunding investing cap has some downsides, according to institutional investors. A simple one is that it is an administrative burden to give hundreds of people equity in your company for a small amount of money. Another issue, one investor told TechCrunch, is that institutional investors are sometimes experts in investment areas, which is helpful in a way hundreds of smaller investors might not be. Finally, the max of crowdfunding is still $5 million a year, so the method may be less effective for later-stage companies like, say, Stripe, which needs traditional investors to buy in.

Despite these concerns, the recent Gumroad raise is a continuation of two trends of which Lavingia has been on the forefront: building in public and the democratization of venture capital. He livestreams every Gumroad board meeting through Clubhouse and Zoom, and shares business metrics that most private companies decline to report, such as revenue and profit. (In fact, I knew about this plan to raise months ago after reading one of his newsletters.)

Readers will also remember that Lavingia was one of the first people to use the AngelList platform to create a rolling fund, which uses a 506(c) SEC regulation that allows investors to publicly solicit investments on an ongoing basis. The move was met with controversy at first, since venture capital funds have historically been raised behind closed doors.

Crowdfunding limits are poised to change next week, but most VCs aren’t paying attention — yet

“People were upset at the rolling fund, so imagine when they see that you are cutting out the whole industry [of venture capital],” Lavingia said, referring to a conversation he had with AngelList’s Ravikant.

One thing to be wary of, Lavingia says, is the Testing the Waters dynamic. Under Reg CF and A+, startups are able to differentiate between offering and selling securities. Offering simply allows a founder to “test the waters” and see if interest is there for a crowdfunded round. Despite this guardrail, commitments aren’t capital. For example, a startup could get $1 million in commitments but wind up only raising $100,000, Lavingia said. The conversion rate for intended buys versus actual buys could leave some founders in a thorny spot.

His way for combating this is to be obvious about red flags and transparent, which is already in line with Gumroad’s thesis.

“I preceded this fundraise with a blog post that I’m the only person who works on Gumroad as an employee,” he said. “I want to scare off anyone who is like this is weird [from investing].”

Other than Lavingia, Backstage Capital’s Arlan Hamilton has used Republic to crowdfund her firm’s operating fees. Hamilton made history earlier this month when she raised $1 million in eight hours for her fund. Today, she similarly opened up investments in her firm in light of the new cap and has already closed $2.4 million.

When Hamilton spoke about the raise at TC Sessions: Justice, she said she expects another asset class to be born because venture is a “broken” and “old” system.

“I’ll probably pivot Backstage, we’ll find ways and we’ve already started,” she said. “If you look at our raise we did in the Republic, it didn’t exist the way we wanted it to exist, this ability to go to the crowd as a fund.”

“The way it starts is not by a normal person doing it,” Lavingia said. “It’s by someone who is at the tip of the spear, someone who has an interesting angle, and then it gets sort of democratized over time.”

The fact that a founder turned part-time venture capitalist is using crowdfunding to raise money for his own company is a meta headache on its own. But the founder sees this as an opportunity to make crowdfunding mainstream and an attractive asset class.

Long-term, a public crowdfunding round in startups could be just a small drop in a startup’s financing pre-exit, but one that could empower thousands of normal people to own startup equity for the first time.

“I’m basically trying to become a private-market Chamath,” he said, referring to the billionaire behind Social Capital credited with the recent boom in popularity around SPACs. “I want to build a huge brand associated with investing in private equities, startups, and having an army of people that I can use and wield in different ways.”

Gumroad founder Sahil Lavingia launches new seed fund in collaboration with AngelList

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The great Gatsby raises millions to take on Robinhood

Millennials and GenZers seem interested in investing more than ever these days. As a result, a number of startups have emerged in recent years to give them more options.

One such startup, Gatsby, announced Monday that it has raised $10 million in a Series A round of funding.

Backers include Techstars Ventures, Beta Bridge Capital, a network of “super angels” placed by ClearList and an oversubscribed SeedInvest campaign. Previous investors include Barclays Bank, SWS Venture Capital, and Rosecliff Ventures, 

Jeff Myers and Ryan Belanger-Saleh co-founded Gatsby, a commission-free options and stock trading app aimed at younger traders, in 2018. The pair had already one successful exit in Dealtable.com, a social data room platform. 

Co-founders and co-CEOs Jeff Myers (left) and Ryan Balenger-Saleh (right)

Notably, Peter Quinn, a founder of stock trading service Public.com — which recently raised $220 million at a $1.2 billion valuation — serves as Gatsby’s chief operations officer and as the company’s first hire, is considered a member of its founding team.

Besides focusing on a younger demographic, Gatsby aims to give people “a safe and fair platform to trade on without users having to worry about getting in over their heads or being shut out of names when volatility spikes.” The app launched into iOS and Android in early 2020, with the number of signups doubling since the beginning of 2021.

It’s also seen a spike in trade volume with cannabis and meme stocks ranking among its most popular trades of the year so far. 

Gatsby aims to take on Robinhood by offering traders no commission trading, no per-contract fees and “with no excessive jargon.” Beyond that, it also offers users a way to earn revenues from trade activity through a rewards program or as Myers puts it, “get paid to trade.” It also hosts a social network that can be a source for trade ideas or a place for Gatsby traders to share on their wins (or commiserate their losses).

“We believe that PFOF (payment for order flow) is a fundamentally better pricing model than commissions for users trading on small accounts as long as customers feel like their broker is being fair and honest about execution quality and how they make money,” Myers said.

In the second quarter, Gatsby plans to launch a feature called ‘Gatsby Circles,’ through which traders can create groups of friends to follow and share trades, and get alerts when someone in their circle executes a trade. 

The startup plans to use its new capital “to grow aggressively” in 2021. Specifically, the company plans to expand in engineering and brokerage operations over the course of the year. It plans to boost its 12-person team by another “10 to 20 heads” over the next three quarters, according to Myers.

The company’s goal is to have over 100,000 accounts by year’s end.

Gatsby also plans to launch additional research tools for more sophisticated options traders, as well as more advanced strategies. Down the line, the startup is also planning to launch crypto-trading features.

It’s also working on building an adaptive interface. This means that Gatsby’s algorithm will assess the trader and adjust the feature set and interface to be tailored for that user depending on their experience level.

For Jordan French, an early stage investor in Gatsby and publisher at Grit Daily News, Myers and Belanger-Saleh “have the right combination of technology and marketing experience to grow Gatsby into a defensible position that will be very difficult for competitors to unseat.”

He also believes the company’s approach aligns closely with its core investor base.

Gatsby seeks to “shed the ‘fat-cat cronyism’ of legacy financial institutions,” French added.

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DeepSee.ai raises $22.6M Series A for its AI-centric process automation platform

DeepSee.ai, a startup that helps enterprises use AI to automate line-of-business problems, today announced that it has raised a $22.6 million Series A funding round led by led by ForgePoint Capital. Previous investors AllegisCyber Capital and Signal Peak Ventures also participated in this round, which brings the Salt Lake City-based company’s total funding to date to $30.7 million.

The company argues that it offers enterprises a different take on process automation. The industry buzzword these days is ‘robotic process automation,’ but DeepSee.ai argues that what it does is different. I describe its system as ‘knowledge process automation’ (KPA). The company itself defines this as a system that “mines unstructured data, operationalizes AI-powered insights, and automates results into real-time action for the enterprise.” But the company also argues that today’s bots focus on basic task automation that doesn’t offer the kind of deeper insights that sophisticated machine learning models can bring to the table. The company also stresses that it doesn’t aim to replace knowledge workers but help them leverage AI to turn the plethora of data that businesses now collect into actionable insights.

Image Credits: DeepSee.ai

“Executives are telling me they need business outcomes and not science projects,” writes DeepSee.ai CEO Steve Shillingford. “And today, the burgeoning frustration with most AI-centric deployments in large-scale enterprises is they look great in theory but largely fail in production. We think that’s because right now the current ‘AI approach’ lacks a holistic business context relevance. It’s unthinking, rigid, and without the contextual input of subject-matter experts on the ground. We founded DeepSee to bridge the gap between powerful technology and line-of-business, with adaptable solutions that empower our customers to operationalize AI-powered automation – delivering faster, better, and cheaper results for our users.”

To help businesses get started with the platform, DeepSee.ai offers three core tools. There’s DeepSee Assembler, which ingests unstructured data and gets it ready for labeling, model review and analysis. Then, DeepSee Atlas can use this data to train AI models that can understand a company’s business processes and help subject-matter experts define templates, rules and logic for automating a company’s internal processes. The third tool, DeepSee Advisor, meanwhile focuses on using text analysis to help companies better understand and evaluate their business processes.

Currently, the company’s focus is on providing these tools for insurance companies, the public sector and capital markets. In the insurance space, use cases include fraud detection, claims prediction and processing, and using large amounts of unstructured data to identify patterns in agent audits, for example.

That’s a relatively limited number of industries for a startup to operate in, but the company says it will use its new funding to accelerate product development and expand to new verticals.

“Using KPA, line-of-business executives can bridge data science and enterprise outcomes, operationalize AI/ML-powered automation at scale, and use predictive insights in real time to grow revenue, reduce cost, and mitigate risk,” said Sean Cunningham, Managing Director of ForgePoint Capital. “As a leading cybersecurity investor, ForgePoint sees the daily security challenges around insider threat, data visibility, and compliance. This investment in DeepSee accelerates the ability to reduce risk with business automation and delivers much-needed AI transparency required by customers for implementation.”