Wag’s recovery is a bet on you going back to work

Remember Wag? The dog-walking app made huge waves back in 2018 when it raised $300 million from SoftBank’s Vision Fund.

Competing with rival Rover, Wag’s service fell out of our minds in the years since its mega-deal. Today, Wag is back in the news thanks to a recently announced SPAC deal that will take the company public.

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In basic terms, Wag’s results detail a company that took blows during the pandemic as folks stayed home, meaning that they needed external dog care less than before. But, with its results ramping up, Wag expects to continue its recovery thanks to workers heading back to the office this year. The office-return dynamics make Wag’s forward-looking projections very interesting.

Let’s hammer through the SPAC deal terms and then look at Wag’s historical results and what it expects for the future. After all, the return-to-office question will impact a host of companies beyond Wag. From Uber to DoorDash and beyond, a return to more old-fashioned working conditions would rejigger our economy once again.

The Wag deal

Wag is merging with CHW Acquisition Corporation. The deal calls Wag a “vertically integrated technology platform,” notably. The release also states that capital is being provided as part of the deal by “current Wag! and CHW investors,” including “Battery Ventures, ACME Capital, General Catalyst and Tenaya Capital.” That, in a nutshell, is why we care about this deal; it’s a venture-backed company that is still raising venture capital.

In more boring terms, the “transaction values the combined company at a pro forma enterprise and equity value of approximately $350 million,” which isn’t much. Especially given that private capital into Wag to this point is around the same number. The deal, presuming “no redemptions from the CHW shareholders, [will] deliver approximately $175 million in gross cash proceeds to the combined company.”

Shares of CHW Acquisition Corporation trended lower last week, but recovered to $9.82 per share today, a slight discount to the usual $10 per share SPAC price that we tend to see pre-combination. Still, the market hasn’t thrown up its arms at the deal’s concept since its announcement. Why? In part because Wag’s numbers are pointing in the right direction.

A pandemic recovery

To understand Wag’s return to growth, we have to discuss its declines. In short, when the pandemic hit, demand for Wag’s service — dog walking, pet care, etc. — fell off a cliff.


Salt Security closes $20M Series A to help protect APIs

Today Salt Security, a startup that helps companies protect APIs, announced that it has closed a $20 million Series A. The Palo Alto-based company secured the new funds from Tenaya Capital, bringing its total capital raised to around $30 million.

The Salt round caught TechCrunch’s eye as it fits reasonably well into a growing trend of API-powered and focused startups raising capital in recent months. On the back of Plaid’s epic exit, and the continued success of Twilio, APIs appear to be a lucrative way for startups to build attractive revenue tallies that entice both investors and acquirers alike.

Notably Salt Security offers its API security service — the startup helps customers defend against API “attacks,” and find API-related “vulnerabilities,” per its website — as a SaaS application; the company did tell TechCrunch that it can also “integrate via API with other solutions in a customer’s environment,” for what it’s worth. Regardless, as Salt is a startup focused on the API economy, we wanted to note its funding event.

To get a handle on how the company managed to raise during a purportedly difficult time to attract new capital, TechCrunch dug in a little bit. Read on for growth notes, and some details on whether more startups are using APIs to power their businesses.


The short answer regarding how Salt managed to secure capital is growth, as far as TechCrunch can surmise: According to the firm, Salt “almost doubled [its] revenue in the first half of 2020 from the end of 2019 despite COVID-19 in addition to retaining our existing customers.” As the firm just raised a Series A, its 2019 end-of-year revenue tally likely wasn’t huge, but the company’s pace of topline expansion is precisely what private investors like to bet on.

Even better, Salt shared with TechCrunch that its gross margins have “significantly improved to over 90%” in response to a question regarding changes in the startup’s gross margin profile over the last 18 months. Salt also cited sharp demand for its product from larger companies in its notes to this publication.

But it’s smaller companies that we’re more interested in, given our API startup focus. TechCrunch asked Salt if it is seeing API-powered business models becoming more popular among growing tech companies. Via email, the startup said that it has “seen an increase in the use of third party APIs and more companies are opening new APIs for partners to share data” and that APIs are “definitely a growing business model not only for startups but also for established companies looking to innovate and grow their business.”

Good to know that we weren’t out to lunch when we noted the trend.

Wrapping, while researching Salt for this post TechCrunch noticed that the company’s website details an all-male leadership team. We raised the matter to the startup, which responded saying that “diversity and inclusion are core to [its] culture,” and that it views the matter as “critical to a healthy, productive, creative and growing team.” Salt also said that it has “plans to double in size by the end of year and this will create many opportunities for growing diversity within our executives and across our entire team.” We’ll take a peek at the same metric the next time we talk to the company.

Former Uber exec raises $31M for his Jakarta-based logistics startup Kargo, announces relief fund to battle coronavirus

Kargo, a Jakarta-based logistics startup co-founded by veteran Uber Asia executive Tiger Fang, has raised $31 million to scale its business and help firms in the Southeast Asian nation fight the coronavirus.

Silicon Valley-based Tenaya Capital, Sequoia India, and Intudo Ventures among others financed Kargo’s Series A round. The startup, which has raised $38.6 million to date, counts Uber founder and former chief executive Travis Kalanick as an investor.

Kargo takes some of the concepts behind Uber and applies them to trucking and logistics. That’s to say that business customers order trucks using a mobile app or website, but the scope is wider, said Fang. Unlike Uber, Kargo works with truck operators and 3PLs rather than truck drivers themselves.

For its Series A announcement, Kargo has an unusual pitch: It wants to help companies in Indonesia fight the coronavirus. The startup plans to do so with its newly formed $1 million relief fund for truckers, and through partnerships with several charitable organizations including Kita Bisa, PT Akar Indah Pratama, with whom it is working to deliver meals and essential medical supplies to healthcare workers and patients at multiple hospitals.

The startup said it is taking several precautions to keep drivers safe. This includes ensuring that all pit stops on its routes are well-stocked and properly disinfected. Kargo has also implemented an electronic proof of delivery mechanism on its platform to limit physical contact between users.

“Kargo pledges to be the most reliable logistics partner to ensure no disruptions to the supply chain of essential items in Indonesia. Our entire company is donating a portion of our salaries to this cause and we invite local businesses and organizations to get in touch so we can work this problem together,” said Fang.

“We’re grateful for our wonderful investors who continue to support us, even in a time of financial uncertainty,” he added.

Logistics remains a major opportunity in several South Asian markets as local shippers and transporters begin to slowly adopt technology to address infrastructure inefficiencies.

Kargo has already amassed more than 6,000 active shippers and a network of more than 50,000 trucks across the nation.

Domio raises $100M in equity and debt to take on Airbnb and hotels with its curated apartments

Airbnb has well and truly disrupted the world of travel accommodation, changing the conversation not just around how people discover and book places to stay, but what they expect when they get there, and what they expect to pay. Today, one of the startups riding that wave is announcing a significant round of funding to fuel its own contribution to the marketplace.

Domio, a startup that designs and then rents out apart-hotels with kitchens and other full-home experiences, has raised $100 million, $50 million in equity and $50 million in debt, to expand its business in the US and globally to 25 markets by next year, up from 12 today. Its target customers are younger, millennials travelling in groups, or families swayed by the size and scope of the accommodation — typically five times bigger than the average hotel room — as well as the price, which is on average 25% cheaper than a hotel room.

The Series B, which actually closed in August of this year, was led by GGV Capital, with participation from Eldridge Industries, 3L Capital, Tribeca Venture Partners, Softbank NY, Tenaya Capital and Upper90. Upper90 also led the debt round, which will be used to lease and set up new properties.

Domio is not disclosing its valuation, but Jay Roberts, the founder and CEO, said in an interview that it’s a “huge upround” and around 50x the valuation it had in its seed round and that the company has tripled its revenues in the last year. Prior to this, Domio had only raised around $17 million, according to data from PitchBook.

For some comparisons, Sonder — another company that rents out serviced apartments to the kind of travellers who have a taste for boutique hotels — earlier this year raised $225 million at a valuation north of $1 billion. Others like Guesty, which are building platforms for others to list and manage their apartments on platforms like Airbnb, recently raised $35 million with a valuation likely in the range of $180 million to $200 million. Airbnb is estimated to be valued around $31 billion.

Domio plays in an interesting corner of the market. For starters, it focuses its accommodations at many of the same demographics as an Airbnb. But where Airbnb offers a veritable hodgepodge of rooms and homes — some are people’s homes, some are vacation places, some never had and never will have a private occupant, and across all those the range of quality varies wildly — Domio offers predictability and consistency with its (possibly more anodyne) inventory.

“We are competing with amateur hosts on Airbnb,” said Roberts, who previously worked in real estate investment banking. “This is the next step, a modern brand, the next Marriott but with a more tech-powered brain and operating model.” These are not to be confused with something like Hilton’s Homewood Suites, Roberts stressed to me. He referred to Homewood as “a soulless hotel chain.”

“Domio is the anti-hotel chain,” he added.

Roberts is also quick to describe how Domio is not a real estate company as much as it is a tech-powered business. For starters, it uses quant-style algorithms that it’s built in-house to identify regions where it wants to build out its business, basing it not just on what consumers are searching for, but also weather patterns, economic indicators and other factors. After identifying a city or other location, it works on securing properties.

It typically sets up its accommodations in newer or completely new buildings, where developers — at least up to now — are not usually constructing with short-term rentals in mind. Instead, they are considering an option like Domio as an alternative to selling as condominiums or apartments, something that might come up if they are sensing that there is a softening in the market. “We typically have 75%-78% occupancy,” Roberts said. He added that hotels on average have occupancy rates in the high 60% nationally.

As Domio lengthens its track record — its 12 U.S. markets include Miami, Los Angeles, Philadelphia and Phoenix — Roberts says that they’re getting a more select seat at the table in conversations.

“Investors are starting to go out buy properties on our behalf and lease them to us,” he said. This gives the startup a much more favorable rate and terms on those deals. “The next step is that Domio will manage these directly.” The most recent property it signed, he noted, includes a Whole Foods at the ground level and a gym.

Using technology to identify where to grow is not the only area where tech plays a role. Roberts said that the company is now working on an app — yet to be released — that will be the epicenter of how guests interact to book places and manage their experience once there.

“Everything you can do by speaking to a human in a traditional hotel you will be able to do with the Domio app,” he said. That will include ordering room service, getting more towels, booking experiences and getting restaurant recommendations. “You can book your Uber through the Domio app, or sync your Spotify account to play music in the apartment.

There are plans to extend the retail experience too using the app. Roberts says it will be a “shoppable” experience where, if you like a sofa or piece of art in the place where you’re staying, you can order it for your own home. You can even order the same wallpaper that’s been designed to decorate Domio apartments.

Ripe for the booking

Although Airbnb has grown to be nearly as ubiquitous as hotels (and perhaps even more prominent, depending on who you are talking to), the wider travel and accommodation market is still ripe for the taking, estimated to reach $171 billion by 2023 and the highest growth sector in the travel industry.

“Airbnb has taught us that hotels are not the only to stay,” said Hans Tung, GGV’s managing partner. “Domio is capitalizing on the global shift in short-term travel and the consumer demand for branded experiences.  From my travels around the world, there is a large, underserved audience – millennials, families, business teams – who prefer the combined benefits of an apartment and hotel in a single branded experience.”

I mentioned to Roberts that the leasing model reminded me a little of WeWork, which itself does not own the property it curates and turns into office space for its tenants. (The Softbank investor connection is interesting in that regard.) Roberts was very quick to say that it’s not the same kind of business, even if both are based around leased property re-rented out to tenants.

“One of the things we liked about Domio is that is very capital efficient,” said Tung, “focusing on the model and payback period. The short-term nature of customer stays and the combination of experience/price required for to maintain loyal customers are natural enforcers of efficient unit economics.”

“For GGV, Domio stands out in two ways,” he continued. “First, CEO Jay Roberts and the Domio team’s emphasis on execution is impressive, with expansion in to 12 cities in just three years. They have the right combination of vision, speed and agility. Domio’s model can readily tap into the global opportunity as they have ambition to scale to new markets. The global travel and tourism spend is $2.8 trillion with 5 billion annual tourists. Global travellers like having the flexibility and convenience of both an apartment and hotel – with Domio they can have both.”

Wrench’s on-demand vehicle repair and maintenance service picks up $20 million

Wrench, the Seattle-based on demand vehicle maintenance and repair service for consumers and fleets, has raised $20 million in its latest round of financing.

The company’s round was led by Vulcan Capital with additional participation from Madrona Venture Group, Tenaya Capital and Marubeni Corp.

Wrench is one of a growing number of companies that are using technology to adapt what had previously been infrastructure-heavy services closer to a more consumer-friendly, convenient business model. Other companies operating in a similar vein (and in automotive) include the refueling and car wash on-demand startups like Filld, Yoshi, and Booster Fuels for gassing up and Spiffy, Wype, Washos and Washé for washing.

Equipped with diagnostic software that can assess problems with vehicles based on their owners descriptions and service trucks that can handle most maintenance and repair work, Wrench meets fleet operators and consumers at their vehicle’s to provide servicing and repairs.

It’s a model that’s attracted some competitors with big backing. RepairSmith, which operates a similar service out of Los Angeles and San Francisco, is backed by Daimler to provide much the same on-demand repair services.

Given the competition coming into the market, it’s no wonder that Wrench is raising additional capital to expand its footprint into new markets. The company also said it intends to use the financing to make some key hires.

“Busy consumers need a simple scheduling and vehicle diagnosis system to deliver repair and maintenance services without the hassle of the waiting room,” said Ed Petersen, the company’s chief executive, in a statement.

Wrench has already serviced around 100,000 vehicles, according to Petersen and all of the company’s repair and servicing visits come with a 12,000-mile warranty and a vehicle inspection with the results delivered to a customer.

“Consumers are embracing on-demand services that make their lives better.  Wrench’s technology-enabled mobile mechanic service saves customers time and money – resulting in high customer satisfaction and lifetime value,” said Stuart Nagae, Director of Venture Capital at Vulcan Capital. “With more than 270 million vehicles in the United States, the opportunity is enormous.”

Wrench has already begun its process of geographic expansion with the acquisition earlier this year of the Canadian mobile automotive mechanic startup Fiix, which provided mobile mechanic services to around 80,000 customers across North America.

Wrench raised $4 million in its first round of financing, which TechCrunch covered back in 2017.


BetterUp raises $103M to fast-track employee learning and development

BetterUp, a company that connects employees with expert career and leadership development coaches online, has secured a $103 million Series C from Lightspeed Venture Partners, Threshold Ventures, Freestyle Capital, Crosslink Capital, Tenaya Capital and Silicon Valley Bank.

For access to its mobile coaches, which are meant to expedite development among employees and foster purpose and passion within the workplace, BetterUp offers a SaaS service to enterprises. Its customers include Airbnb, AppDynamics and Instacart, as well as 28 of the Fortune 1000.

The company said recently that the influx of Fortune 1000 customers has led to tripled revenue growth year-over-year.

“We are proud to be enabling innovative companies who recognize that their biggest asset—their people—deserve an elevated employee experience that speaks to who they are as whole persons, not just employees,” BetterUp co-founder and chief executive officer Alexi Robichaux said in a statement. “By combining human expertise, the latest advances in scientific research, and digital technologies including AI and machine learning we’re delivering unprecedented levels of personalized learning at scale.”

San Francisco-based BetterUp has previously raised about $43 million in venture capital funding since it was founded in 2012. It reached a valuation of $125 million with a $30 million Series B in March 2018, according to PitchBook. BetterUp declined to disclose its Series C valuation

BetterUp says its latest round is the largest ever for a “tech-enabled coaching, behavior change and wellness” platform. There isn’t a whole lot of competition in that space just yet. Nonetheless, $100 million is a sizable capital infusion for any startup.

Though career coaching hasn’t become VCs new favorite space — yet — startups creating tools for other startups is a trend that’s taken off in the last couple of years. Just look at Brex . In just two years, the company, which creates corporate cards for startups, has garnered a valuation of $2.6 billion. Gusto, WeWork, Plaid, Stripe, Atrium, Intercom and Outreach are just a few more examples of this emerging category.

“BetterUp is the one company fundamentally investing in the most important part of the future of work — human beings, Lightpseed’s Will Kohler said in a statement. “No other company drives measurable outcomes that change lives and workplaces.”

Startups Weekly: Is Munchery the Fyre Festival of startups?

It was a tough week. Journalists around the U.S. were hit hard by layoffs, from HuffPost to BuzzFeed News to Verizon Media Group, which owns this very site. The government entered day 35 of the shutdown before President Donald Trump agreed to a short-term deal to reopen it for three weeks. And in the startup world, a once high-flying, venture-subsidized food delivery startup crashed and burned, leaving a cluster of small businesses in its wreckage.

Some good things happened too — we’ll get to those.

  1. Munchery fails to pay its debts

In an email to customers on Monday, Munchery announced it would cease operations, effective immediately. It, however, failed to notify any of its vendors, small businesses in San Francisco that had supplied baked goods to the startup for years. I talked to several of those business owners about what they’re owed and what the sudden disappearance of Munchery means for them.

  1. #Theranos #Content

If you haven’t read John Carreyrou’s “Bad Blood,” stop reading this newsletter right now and go get yourself a copy. If you love to read, watch and listen to the Theranos saga as much as I do, you’ll be glad to hear there’s some fresh Theranos content released to the world this week. Called “The Dropout,” a new ABC documentary and an accompanying podcast about Theranos features never-before-aired depositions. Plus, TechCrunch’s Josh Constine reviews the Theranos documentary, “The Inventor,” which premiered at the Sundance Film Festival this week.

  1. Deal of the week

Confluent, the developer of a streaming data technology that processes massive amounts of information in real time, announced a $125 million Series D round on an enormous $2.5 billion valuation (up 5x from its Series C valuation). The round was led by existing investor Sequoia Capital, with participation from other top-tier VCs Index Ventures and Benchmark.

  1. Wag founders ditch dogs for bikes

Jonathan and Joshua Viner, the founders of the SoftBank-backed dog walking startup Wag, launched Wheels this week, an electric bike-share startup with a $37 million funding from Tenaya Capital, Bullpen Capital, Naval Ravikant and others.

  1. Go-Jek makes progress on a $2B round

Indonesia-headquartered Go-Jek has closed an initial chunk of what it hopes will be a $2 billion round after a collection of existing investors, including Google, Tencent and JD.com, agreed to put around $920 million toward it, according to TechCrunch’s Southeast Asia reporter Jon Russell. The deal, which we understand could be announced as soon as next week, will value Go-Jek’s business at around $9.5 billion.

  1. Knowledge center

There’s been a lot of chatter around direct listings since Spotify opted to go public via the untraditional route in 2018, but what exactly is a direct listing… We asked a panel of six experts: “What are the implications of direct listing tech IPOs for financial services, regulation, venture capital and capital markets activity?” 

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

  1. Contraceptive deserts

Through telemedicine and direct-to-consumer sales platforms, startups are streamlining the historically arduous process of accessing contraception. The latest effort to secure a significant financing round is The Pill Club, an online birth control prescription and delivery service. This week, the consumer-focused investor VMG Partners led its $51 million Series B. 

  1. More startup cash
  1. Fundraising activity

Sunil Nagaraj spent years investing in startups at Bessemer Venture Partners, but he was itching to meet with younger companies and strike out on his own. So in the summer of 2017, he did, and now, Nagaraj said he’s closed Ubiquity Ventures’ debut fund with $30 million. March Capital Partners, the Los Angeles-based venture capital firm, raised $300 million for its latest fund. Plus, Zynga founder Mark Pincus is reportedly raising up to $700 million for a new investment fund, called Reinvent Capital, that will focus on publicly traded tech companies in need of strategic restructuring.

  1. Finally, meet the startups in Alchemist’s 20th cohort

A mental health startup, a construction tech business and a fintech company, among others. Take a quick look at the startups that just completed Alchemist’s six-month accelerator program.

  1. Listen to me talk

If you enjoy this newsletter, be sure to check out TechCrunch’s venture-focused podcast, Equity. In this week’s episode, available here, Crunchbase editor-in-chief Alex Wilhelm, TechCrunch’s Silicon Valley editor Connie Loizos and I chatted about Munchery’s downfall, The Pill Club’s mission to make birth control more accessible and the VC slowdown in China.


Video consultation service Doctor on Demand raised $74 million so everyone can see a doctor anytime

Healing America’s broken healthcare industry has been at the top of the priority list for almost every politician, entrepreneur, and inventor for at least the past forty years.

Costs continue to climb (roughly 5% this year) and spending is already 20% of the nation’s GDP. For the trillions of dollars Americans spend on healthcare they’re getting declining services, more frequent ailments and a steadily diverging standard of care for the rich and the poor in the country.

Something needs to be done — and venture capitalists and some of the biggest names in finance led by Goldman Sachs are investing $73 million in a technology startup they see as a potential solution.

The company is Doctor on Demand and its solution is video-based telemedicine.

The new funding led by Goldman Sachs and Princeville Global (with participation from existing investors including Venrock, Shasta Ventures, and Tenaya Capital) will be used to continue the company’s rapid expansion in the U.S. and abroad — and brings the company’s total financing to $160 million.

“This trend of consumerization, which we’re leading, is really going to result in much greater patient driven healthcare experiences which will save the patient a lot of money,” says company chief executive Hill Ferguson .

Ferguson knows that the arc of internet services bends towards on-demand and he says that healthcare should be no different. “Most people have no idea they can see a board-certified physician on their phone from their bed while they’re sick at two in the morning with a five minute wait time,” he says.

That’s essentially the service that Doctor on Demand provides.

While the company’s consultations aren’t a panacea for everything that ails the healthcare industry, Ferguson claims his company’s board certified staff can handle 90% of the consultations that happen every day in Urgent Care facilities and for $300 less than insurers currently pay out.

While the service started out as something that consumers had to pay out of pocket, it has now transitioned to a more seamless (and cheaper) option for customers — it’s covered by most major insurance carriers.

“We’ve shifted from being a cash pay virtual practice to more of an enterprise player. we’re driving most of our volume through health insurance plans and employers,” Ferguson says.

The company employs its own doctors and staffs its video consultation service 24-hours a day, seven days a week, Ferguson says. Despite the workload — which sees the company’s virtual doctors consult with four patients each hour on average — the company’s fourteen day readmission rate (a standard measure of effective diagnoses) is on par with brick and mortar services, Ferguson says.

Roughly 5% of the consultations involve patients who need to be referred to specialists, according to Ferguson.

The service can also refer patients to diagnostics and testing facilities to get bloodwork and other tests that can supplement an initial diagnosis.

Through its agreements with insurers, Doctor on Demand stipulates what kinds of conditions its video consultations can cover, and which ailments and maladies require immediate medical attention. Increasingly, customers are taking advantage of the company’s mental health services — an area that’s grown 240% since it was introduced, according to Ferguson.

Mental health is one growth area for the company and its testing services provide another. In all, Ferguson thinks there’s a $50 billion addressable market in the U.S. alone. A figure he says more than justifies the company’s $160 million (and counting) in funding.


Doctor on Demand isn’t profitable yet, and the new financing still sees the company valued under $1 billion, but Ferguson is confident about the future. “I gotta wear shades,” the chief executive said.