Month: April 2018

EcoFlow, a Chinese hardware firm developed by former JDI engineers that sells portable power stations, has pulled in a Series A round of over $4 million ahead of the imminent launch of new products and an international sales expansion.

The Shenzhen-based company has taken an interesting route. Founded in 2016, the startup burst on to the scene when it launched its River product in an Indiegogo campaign that pulled in $1 million. Today, River is available in the U.S. where it is sold via Home Depot, Camping World, Amazon, HSN and the EcoFlow website for $699 upwards.

That’s pretty impressive progress for a young company, and CEO and co-founder Eli Harris told TechCrunch in an interview that relationships with key partners are at the core of that. In particular, EcoFlow has raised strategic investment from supply chain partners rather than traditional VC and that is the case again. This new $4 million came courtesy of battery makers Guangzhou Penghui Energy and SCUD Group, industrial design tooling factory ESID, and supply chain-focused firms Delian Capital and Chunjia Assets.

Names that aren’t known in Silicon Valley, for sure, but the key is what they bring to the table.

“Our investors are almost entirely vertically integrated with every component in our supply chain,” Harris said. “That gives us access to these top-tier manufacturers that no startups could enjoy and help us get direct access to vendors at large companies.”

Aside from reaching quality components and getting a good price, relationships with these component makers help EcoFlow with its cash flow — always a challenge puzzle piece for hardware startups. Harris explained that the relationships allow his company to delay paying for components rather than having to pay upfront — before product is sold and revenue comes in — which optimizes the books and means the capital can be put to work on R&D, sales and marketing and more.

The River itself is touted as industry-leading portable power. Aside from an aesthetic nice design, the li-ion-based device has a total output of 500 watts, weighs just 11 pounds and features two quick-charge USB ports, two USB type C ports, two standard USB ports, two AC outlets, two DC outlets and one 12V car port.

Now EcoFlow is doubling down with plans to launch two new products before the end of this year. Harris isn’t providing specific details right now, but he said the company is looking to take advantage of its promising growth.

“We think we are around 18 months ahead of the market in terms of engineering capabilities. Most experienced battery players are going after electronic vehicles and industrial opportunities, while smaller players have issues getting to manufactures, talent and money to build portable energy solutions,” he said.

While $699 may make the product a luxury for some — despite a $100 discount right now — Harris said that the price is likely to decrease going forward as technology develops.

“Batteries are expensive products but we will see costs come down with the expansion of the EV market, so we’ll be trending in the right direction. But people who understand the tech don’t think it is an expensive product,” Harris explained.

“A lot of the tech we use now will be utilized in future products so that’ll mean lower development costs as we leverage existing IP. We’re also exploring using second life batteries since cells are one of the biggest expenses of the product,” he added.

Working with those battery makers that it also counts as investors could help on that second-life battery push, which could cut the costs to one-fourth of what EcoFlow pays now.

While tactically-selected investors are a boon for many reasons, Harris admitted that they do require educating of the investor-investee relationship as it is unconventional in their space. But, he said, increasingly large component and manufacturing firms are keen to do startup investments to help get new ideas, open relationships in the U.S. and explore other new areas of focus.

“A lot of the manufacturing industry players have been stuck in that OEM wheelhouse and there’s more competition now. The previous models of just churning out product might not be sustainable, and margins are thinner,” he said.

Most immediately, EcoFlow is looking to expand sales beyond the U.S and Canada with plans to move into Europe later this year. It also plans to raise a “significant” funding round before 2018 is out as the two new products hit the market.

from TechCrunch

The ongoing trend of consolidation in the world of ridesharing continues apace, with the latest development coming out of Europe. BlaBlaCar, the French carpooling platform, is acquiring Less, a young carpooling platform based in Paris and focusing only on urban rides, paying drivers on a per-kilometer rate to incentivize them.

The financial terms are not being disclosed but BlaBlaCar is picking up all of the company’s assets — it mentions skills and IP in app creation and distribution, big data analytics and in-car embedded systems — and employees (around 20 in all).

Less was less than mature. Co-founded by the founder of adtech firm Criteo, Florent Boutellier, it had launched a beta of its service only five months ago, in December 2017 (and it was founded about 18 months ago altogether).

Two salient facts of the ride-sharing industry are that it’s generally a very capital-intensive business — market leader Uber has raised $21 billion, for context — and it is built on economies of scale, and those two forces have been leading to a lot of movement, with the bigger fish snapping up the more promising of the smaller fish, and many more startups going belly up. Less threw in the towel so quickly, in part, because it didn’t see itself able to hit the right growth targets to survive.

“Less is conscious of the challenges of creating a scalable marketplace in the mobility space, and anticipating consolidation within the market, the team wanted to combine its forces with an established industry player”, said Jean-Baptiste Rudelle, the CEO of Less, in a statement to TechCrunch.

“Joining forces with BlaBlaCar is a fantastic opportunity for the team to innovate within the mobility sector, with immediate impact and on a large scale,” said Florent Boutellier, in a statement.

BlaBlaCar has made seven other acquisitions in its own efforts to position itself as a Big Fish, including its closest competitor, Carpooling.

Less is not disclosing how many users it had, but BlaBlaCar itself now has around 60 million users in 22 countries.

BlaBlaCar has raised about $335 million in funding to date from investors that include Accel and Insight Venture Partners; and it was last valued at $1.6 billion when it raised $200 million back in 2015 (when it had only 20 million users). Less had raised $19 million from investors that included Index Ventures (who had also been one of Criteo’s early and consistent backers).

What the acquisition of Less will do potentially is help BlaBlaCar build out its short-distance urban mobility play. The bigger company got its start originally by focusing on long-distance rides, although last year it expanded into city rides with BlaBlaLines.

BlaBlaLines has been building out its service with riders paying drivers directly, in cash, while Less’s model is based on a per-kilometer fee — currently €0.10/km — in the city of Paris, the only place Less had launched. It’s reasonable to expect that one outcome of this deal will be BlaBlaLines taking on a similar pricing model.

“We are delighted to welcome an innovative and talented team that is just as passionate about carpooling as we are,” said Nicolas Brusson, co-founder and CEO of BlaBlaCar, in a statement. “Today’s acquisition takes place at a period of real innovation at BlaBlaCar, following the roll-out of BlaBlaLines across France, and the development of a new algorithm that increases the granularity of our long-distance service.”

from TechCrunch

$4.5 billion-valued ride-sharing startup Go-Jek may be busy in Southeast Asia, where it is aiming to step into the gap following Uber’s exit, but that isn’t stopping it from looking at opportunities elsewhere in the world.

Over in Bangladesh, motorbike-taxi hailing service Pathao has announced that it raised a “pre-Series A” investment led by Go-Jek. The Indonesian firm first invested in Pathao last year, and it is leading this new deal which includes participation from existing backers Openspace Ventures — which just rebranded from NSI Ventures and is an early Go-Jek backer — Osiris Group and Battery Road Digital Holdings.

The round is undisclosed, but TechCrunch understands from a source that it is more than $10 million. The startup did confirm that its valuation is over $100 million.

CEO Hussain Elius told TechCrunch in an interview that Pathao plans to use the capital to expand to new cities, and continue to build out additional services. The company began offering motorbike taxis on-demand and a logistics service, and it branched out into food delivery this year. Now, Elius said, it is developing a mobile wallet app that he hopes can encourage adoption of digital payments among Bangladesh’s population of over 160 million. That could unlock the door for a move into other verticals in the future.

When you look at the ride-hailing space and the way that companies have used investment to grow their reach — in particular China Didi’s which has invested companies in the U.S., Latin America, India, Europe, the Middle East and Southeast Asia — it’s inevitable to think that Go-Jek’s investment might lead to future opportunities for the company to expand into South Asia.

Not so, says Elius.

“Go-Jek is an inspiration, [but] we are an independent business and not Go-Jek. [Our] market is very different; there are certain things we are doing which they are not. For example, bike financing is something we are exploring.

“They help us learning, but we don’t share any tech; that’s built in-house,” he added with some pride.

Pathao has plenty in common with Go-Jek. The company began in 2015 initially as a courier service latching on to the growth in e-commerce. It expanded to bike taxis — which was seen as a risk, since they aren’t as popular as in places like Indonesia, Thailand and Vietnam — and then into cars last year. The move appears to be paying off. Today Pathao claims 50,000 bikes and a team of 500 employees who cover its 22 cities. It said it handles a million rides and “over hundred thousand deliveries” each month.

Elius said the firm plans to broaden its coverage of Bangladesh and also look to expand into neighboring countries soon, although he isn’t giving away details at this point. One thing for sure is that they will avoid markets where Go-Jek is present, he said. That seems like a smart strategy.

from TechCrunch

DocuSign priced its IPO Thursday evening at $29 per share, netting the company $629 million.

It was a better price than the e-signature company had been expecting. The initially proposed price range was $24 to $26 and then that was raised to $26 to $28.

The price gives the company a valuation of $4.4 billion on the eve of its public debut, above the $3 billion the company had raised for its last private round.

The IPO has been a long-time coming. Founded in 2003, DocuSign had raised over $500 million over the course of 15 years.

The company brought in $518.5 million in revenue for its fiscal year ending in 2018. This is up from $381.5 million last year and $250.5 million the year before. Losses for this year were $52.3 million, down from $115.4 million last year and, $122.6 million for 2016.

“We have a history of operating losses and may not achieve or sustain profitability in the future,” the company warned in the requisite “risk factors” section of the prospectus.

The filing reveals that Sigma Partners is the largest shareholder, owning 12.9% of the company. Ignition Partners owns 11.7% and Frazier Technology Ventures owns 7.2%.

DocuSign, competes HelloSign and Adobe Sign, among others, but has managed to sign up many of the largest enterprises. T-Mobile, Salesforce, Morgan Stanley and Bank of America are amongst its clients. It has a tiered business model, with companies paying more for added services.

HelloSign COO Whitney Bouck said that “this space is changing the way business is done at its foundation — we are finally realizing the future of digital business and exactly how much more profitable it can be by removing the friction caused by outdated technology and processes.” But she said that DocuSign should be wary of competitive “more nimble vendors that can provide more innovative, faster, and more user-friendly solutions at a cheaper price.”

DocuSign has gone through several management changes over the years.  Dan Springer took over as CEO in early 2017, after running Responsys, which went public and then was later bought by Oracle for $1.5 billion. Chairman Keith Krach had been running the company since 2011. He was previously CEO of Ariba, which was acquired by SAP for $4.3 billion.

from TechCrunch