Author: Thomas Crown

When Collaborative Fund is looking at whether to invest in a company, it’s looking for a startup that’ll be able to accomplish some kind of social good — but also actually make money and be a real business. It’s that theory that’s led the fund for eight years, and Collaborative Fund is going to keep going now with the announcement of closing its fourth fund.

Collaborative Fund has closed its fourth fund, this one a $100 million fund that includes LPs like Quora founder Adam D’Angelo, former Etsy CEO Chad Dickerson, Goop founder Gwyneth Paltrow, former Sequoia partner Tom McMurray, and Indeed founder Rony Kahan. At a time when there are plenty of questions as to where the actual exits are going to happen in venture — including some kinds of creative activity by some firms or necessary ones by larger startups like Uber — Collaborative Fund is doubling down on its strategy of investing early in those companies, which has checked off a number of successful investments thus far.

Collaborative Fund raised its last fund in 2015, when it put together a $70 million fund. Since then, there’s been plenty of activity in some of its investments — perhaps one of the biggest events being Blue Bottle Coffee’s big exist in September last year. Collaborative Fund also includes investments in a number of other companies including  Kickstarter, Lyft, Reddit, Quora, Tala, Science Exchange, LTSE, and Outdoor Voices. The fund led (or co-led) 13 seed rounds, including Ava Winery, Spruce, Dandelion Energy.

“Our thesis works best when there’s clear alignment between founders and investors,” Collaborative Fund founder Craig Shapiro said. “…There’s a growing acceptance and excitement for our thesis. Eight years ago it was obscure and even belittled. More people understand it today.”

In addition, Taylor Greene will be Collaborative Fund’s new partner. Green was previously a partner at Lerer Hippeau Ventures. Shapiro said he’d known Greene for around five years (and competed on many investments, in addition to co-investing in some rounds). “It was through these experiences that I saw firsthand his work ethic, people skills, and steady hand,” Shapiro said. The firm announced it had added Lauren Locktev from New Island Capital around the time it announced its last fund.

Looking at those investments kind of gives a sense of what the firm is looking to accomplish: a company like Lyft has the potential to change the way we move around cities, reduce drunk driving, and have other substantial effects — but at the same time it has to figure out how to run it as a real business if it’s actually going to remain active. Lyft most recently raised $1 billion from Alphabet in a round that valued it at $11 billion.

from TechCrunch

Alibaba is doubling down on logistics after it led a $1.38 billion investment in Chinese courier firm ZTO Express alongside Alibaba logistics affiliate Cainiao.

ZTO went public on the NYSE in 2016 raising $1.4 billion from what was the year’s largest IPO in the U.S. The Shanghai-based company claims to be one of China’s largest logistics firms via a partner-based network. Its clients include Alibaba and rival e-commerce firm JD.com . There’s plenty more overlap between the two, ZTO CFO Huiping Yan previously spent two years working for Cainiao.

Alibaba, Cainiao and other undisclosed investors will buy around 10 percent of the company through the deal, which is expected to be completed in June. ZTO’s stock price closed at $17.30 on Friday (before the long weekend) which represented an all-time high since its IPO in October 2016, when it opened at $18.40 before dropping 15 percent on day-one.

The deal is focused on Alibaba’s ‘new retail’ version which merges e-commerce and offline retail. The idea is to marry the speed and ease of e-commerce with the advantages of brick and mortar, such as being able to touch and feel products and customer care. Alibaba has already introduced hybrid stores in parts of China, and fast logistics represents an important part of the plan.

Alibaba said in a statement that the investment will “deepen their collaboration” between ZTO, Cainiao and Alibaba.

“This investment will enable Cainiao and ZTO to supercharge joint innovation and development to accelerate digitalization of the industry,” Cainiao President Lin Wan said in a statement.

Cainiao was started in 2013 by Alibaba and eight other backers to bring organization in Chinese logistics, particularly around e-commerce deliveries. Last year, Alibaba agreed to pay over $800 million to take majority ownership in the business, which works closely with the Chinese firm’s business units and services to enable fast delivery. Cainiao is valued at around $20 billion based on its most recent fundraising activity.

Despite a large IPO, ZTO has attracted controversy. U.S. pension fund Birmingham Retirement and Relief System sued the business alleging that it exaggerated profit margins to lure investors to its listing in 2016. The company has denied the claims.

from TechCrunch

Flock, a London-based startup that has created a data-driven insurance product for drones, has picked up £2.25 million in seed funding. Leading the round is fintech and insurtech VC fund Anthemis, with participation from Silicon Valley’s Plug and Play, Seed and Speed, and previous backer Downing Ventures. A number of unnamed angel investors also took part.

Describing itself as “pioneering the use of real-time data in insurance,” Flock’s drone insurance has its roots in the academic studies of founder Antton Pena. He wrote his thesis on the use of real-time data to quantify drone flight risks, and began building the first version of the Flock platform at the Data Science Institute at Imperial College London with help from a post-doctoral researcher in artificial intelligence.

Likewise, while studying at Cambridge University, Flock CEO Ed Leon Klinger focused on the future of the autonomous world, writing and publishing papers on driverless vehicles, AI safety, and autonomous drones. This included a paper on the future of the drone industry in which he identified the same solution that Antton had already begun building: the idea that real-time data could be leveraged to identify and quantify the risks of drone flights.

To that end, Flock’s first product, dubbed “Flock Cover”, is a ‘pay-as-you-fly’ insurance app that allows drone pilots to insure flights for a minimum of one hour. It aggregates real-time data, including hyperlocal weather conditions, population density, proximity to high-risk areas (such as airports), and more. Flock’s algorithms then analyse this data, coupled with other data points, such as the weight of the drone, to quantify the risk of any given drone flight. The insurance itself is offered through a partnership with Allianz.

“The problem we’re solving in the drone industry is that drone flight risks are unpredictable, complex, and not particularly well understood by insurers,” explains Klinger. “The result of this is overpriced, cumbersome, but often compulsory insurance policies that are not fit for purpose (in the U.K. drone insurance is a legal requirement for commercial pilots)”.

In contrast, Flock’s use of real-time (and static) data enables the startup to offer pricing that is “risk-dependant,” says Klinger, “so the safer you fly, the less you pay. Our safest pilots now pay less for their insurance than their morning coffee!”.

The company says that 1,000 commercial drone pilots now use Flock Cover, which launched earlier this year in the U.K., representing a departure from flat-rate annual premiums in favour of Flock’s on-demand model.

With that said, the Flock CEO concedes that there are a number of other on-demand drone insurance products already on the market, even if traditional insurers remain the startup’s main competition. “These insurers have been going for longer than us, and they certainly have bigger budgets. What they don’t have is real-time data on their side. They cannot differentiate between high-risk and low-risk customers or flights, so they simply charge everyone roughly the same amount for an annual policy,” he says.

Meanwhile, it would appear that drone insurance is just the beginning, as Klinger and Pena eye up other areas of cover where Big Data can be utilised to offer more flexible and better value insurance.

“As the world becomes increasingly autonomous, from the cars on our streets to the robots in our homes, we can expect to see a whole new set of risks emerge,” adds Klinger. “Here at Flock we’re using cutting edge data science to identify, quantify and insure these risks for drones, but we’re just getting started. Our wider vision is ultimately to bridge the gap between today’s insurers and tomorrow’s technologies, pioneering the use of Big Data in insurance for an autonomous future”.

from TechCrunch

Amazon appears to be restarting its funding efforts in India after Acko, the digital insurance startup in India, confirmed that the U.S. retail giant led a new round of funding for its business.

Amazon — which has been linked with an Acko investment since the start of this year — backed lending startup Capital Float last month, and now it has led a $12 million funding round for Acko alongside Ashish Dhawan, the founder of PE firm ChrysCapital, and existing backer Catamaran Ventures. The deal takes Acko to $42 million raised to date.

Acko was founded in late 2016 by Varun Dua, one of the co-founders of insurance comparison site Coverfox. With Acko, Dua is taking a deeper step into insurance with a digital-only business aimed at disrupting the $10 billion industry in India by leveraging the growth of internet access in India to democratize coverage and develop more relevant products.

Significant funding and big name partners

The company got off to a good start when investors pumped $30 million into it last year, before it had even acquired a license to offer insurance. (That came in September.) Fast-forward 12 months to today, and Acko has covered the traditional space of automobile insurance policies, and a newer category ‘internet economy’ since January. It’s that latter focus that appeals to Amazon via this deal, which Dua told TechCrunch came about after Acko began talking to Amazon as a potential insurance partner.

Acko has gone after big name partnerships in its pursuit of internet economy deals, which Dua said primarily consists of e-commerce, ride-hailing and travel site-focused products. In April, Acko launched passenger insurance for Uber-rival Ola’s ride-hailing service, which covers riders for obvious items like minor accidents, and eventualities like missing a flight due to traffic delays. The insurance claim system is built into the Ola app to simplify the process for users.

“We know from user behavior experience that passengers tend to contact Ola when they have issues, so we wanted to set up a pretty seamless claims process that’s reasonable integrated,” Dua told TechCrunch in an interview, adding that Acko has covered more than 10 million Ola trips so far.

The company is likely to work with Amazon around e-commerce coverage — the first focus of which will be around gadget protection — although nothing is set in stone yet.

“The idea is to find some way to collaborate in the future,” Dua explained. “We’re a new age insurance company and [Amazon] believes it can create value. They see that bundling financial service or something in the lending space [may] happen [in the future] given the data and numbers of users they sit on.”

Acko already offers special deals for Amazon customers

Despite a fierce e-commerce battle in India, Acko isn’t restricted by this deal with Amazon.

Dua said Amazon “completely wants [Acko] to grow independently and it hasn’t laid down any conditions” that might prevent it from working with rivals like Flipkart. Indian media reported that Acko had been in investment talks with Flipkart — which Amazon’s U.S. foe Walmart has agreed to buy a majority stake in — but Dua declined to comment on that rumor.

India has emerged as a key market for Amazon, yet it has backed fewer than half a dozen startups, including home services company HouseJoy, financial comparison service BankBazaar and gift card startup QwikCilver, and acquired just one: payment platform Emvantage in 2016. However, with Capital Float in April and Acko in May, Amazon may be back with renewed vigor.

Dua confirmed that this newest funding round “wasn’t an extremely planned capital raise” but adding Amazon gives the business a further validation.

He said that Acko is aiming to raise a significant funding round next year which would be used to give it a war chest — capital is an important requisite for an insurance provider — and execute on its strategy for the following three years or so. The company has held ongoing talks with undisclosed global insurance firms, Dua said, and that may manifest in a participation in the planned round.

Working with regulators

Part of the current focus is bringing a new online approach to traditional insurance, whilst also figuring out new types of cover that apply to today’s digital age. That’s necessitated a relationship with Indian regulators, and an avoidance of traditional startup practices like the hackneyed (but often true) ‘move fast and break things’ approach to product development and user growth.

“A lot of the thing we want to attempt are new and the regulation isn’t always there,” Dua told TechCrunch. “We have to ensure regulators are on board rather than jumping the gun and facing any backlash later.”

Dua added that typically regulators require two months to sign off on new products — like the Ola micro-insurance for passengers — but that communication lines remain ongoing, and often further clarification is required on Acko’s part.

The company’s Bombay office directs the regulator dialogue and related areas such as compliance, finance and auditing. Acko’s other office in Bangalore houses product development, marketing and tech teams. The startup’s total headcount has grown to around 100, Dua said, with a tech team of around 40 whose priorities include developing claims systems, pricing models and integrating with partners such as Ola and potentially Amazon and Flipkart further down the line.

Acko was one of the first insurers to go all in on digital — certainly at its scale — and Dua said over the past year he has heard of new challengers lining up funding, whilst traditional insurers are taking aim at online by breaking out new business units. In his eyes, Acko has a head start on other digital-only outfits — in terms of timing and funding — while he believes traditional players typical struggle with tech talent and have their eyes on legacy businesses which bring in the bulk of their revenue.

Still, he sees these moves as further validations of Acko’s goal of fully digital insurance.

“I genuinely think it’s possible to create a billion-dollar income in five to six years,” he said. “There have been three insurance model generations world: the global retail commercial risk like AIG, progressives such as DirectLine and now there’s a third-way with the likes of [$3 billion-valued U.S. startup] Oscar, [SoftBank-backed] Lemonade and [China’s] Zhong An.

“When we look at India as a market, generation two and three are both missing — there’s a lot of innovation potential in terms of pricing, distribution, claims efficiency and more.”

from TechCrunch

French startup Riminder recently raised a $2.3 million funding round from various business angels, such as Xavier Niel, Jean-Baptiste Rudelle, Romain Niccoli, Franck Le Ouay, Dominique Vidal, Thibaud Elzière and Fred Potter. The company has been building a deep learning-powered tool to sort applications and resumes so you don’t have to. Riminder participated in TechCrunch’s Startup Battlefield.

Riminder won’t replace your HR department altogether, but it can help you save a ton of time when you’re a popular company. Let’s say you are looking for a mobile designer and you usually get hundreds or thousands of applications.

You can then integrate Riminder with your various channels to collect resumes from various sources. The startup then uses optical character recognition to turn PDFs, images, Word documents and more into text. Riminder then tries to understand all your job positions and turn raw text into useful data.

Finally, the service will rank the applications based on public data and internal data. The company has scraped the web and LinkedIn to understand usual career paths.

Existing HR solutions can integrate with Riminder using an API. This way, you could potentially use the same HR platform, but with Riminder’s smart filtering features.

With this initial sorting, your HR team can more easily get straight to the point and interview the top candidates on the list.

While it’s hard to evaluate algorithm bias, Riminder thinks that leveraging artificial intelligence for recruitment can help surface unusual candidates. You could come from a different country and have a different profile, but maybe you have the perfect past experience for a particular job. Riminder isn’t going to overlook those applications.

With today’s funding round, the company is opening an office in San Francisco to get some clients in the U.S.

from TechCrunch