Jared Leto, Scooter Braun and Troy Carter are backing Moment House, a startup recreating live events… digitally

A pitch to offer artists a way to give geo-fenced, live events to fans around the world has brought the new Los Angeles startup Moment House $1.5 million in seed funding.

The money came from heavy hitters in the Los Angeles entertainment and investment scene including Scooter Braun, Troy Carter, Kygo’s Palm Tree Crew and Jared Leto. Patreon chief executive Jack Conte and Sequoia Capital partner Jess Lee also participated in the round.

Forerunner Ventures led the deal and the investment was made by Kirsten Green, the firm’s famous founder and managing partner. Kevin Mayer, the former chief executive of TikTok; GV chief David Krane; Aaron Levie from Box; the tech media and entertainment guru, Matthew Ball; and product maestro Eugene Wei all participated in the round as well.

Founded by Arjun Mehta, Shray Bansal, and Nigel Egrari, the company grew out of work the three men did while attending the USC Jimmy Iovine & Dr. Dre Academy for the Arts, Technology and the Business of Innovation. 

The company touts itself as the simplest way for artists to create online events for their fans.

For its first foray into live entertainment, Moment House is going to host a geo-fenced, location-specific tour for the musician Yungblud. Other ticketed events from Kygo, blackbear, Kaytranada, Denzel Curry and Ruel will follow, the company said.

For musicians, the company’s pitch of ticketing security, merchandise integrations global payments support, must have been music to their ears — because all of those features add up to one thing… cash.

And performers on the platform take all of the ticket revenues, with Moment House earning money by charging fans a small fee.

In a statement, company co-founder Arjun Mehta said that the company’s technology and service wasn’t a response to the COVID-19 pandemic, but rather a way to amplify the concert going experience with an online approximation.

“Moment House is empowering artists to deliver digital experiences that feel authentic and compelling,” said Leto, in a statement. “I was drawn to the unique design-driven approach because that’s what is needed to create a new category here.”

 

Khosla Ventures seeks $1.1 billion for its latest fund

Khosla Ventures, the eponymous venture firm helmed by longtime Silicon Valley rainmaker, Vinod Khosla, is raising  $1.1 billion for its latest venture fund, according to documents from the Securities and Exchange Commission.

The filing was first spotted by Ari Levy over at CNBC.

Khosla, whose investing career began at Kleiner Perkins Caufield & Byers (back when it was still called Kleiner Perkins Caufield & Byers) is rightly famous for a number of bets on enterprise software companies and was a richly rewarded co-founder of Sun Microsystems before venturing into the world of venture capital.

Like his former partner, John Doerr, Khosla also went all-in on renewable energy and sustainability both at Kleiner Perkins and then later at his own fund, which he reportedly launched with several hundreds of millions of dollars from his personal fortune.

Over the years Khosla Ventures has placed bets and scored big wins across a wide range of industries including cybersecurity (with the over $1 billion acquisition of portfolio company Cylance), sustainability (with the Climate Corp. acquisition), and healthcare (through the public offering of Editas).

And the current portfolio should also have some big exits with a roster that includes: the unicorn lending company, Affirm; the nuclear fusion technology developer, Commonwealth Fusion Systems (maybe not a winner, but so so so cool); delivery company, DoorDash; the meat replacement maker, Impossible Foods; grocery delivery service, Instacart; security technology developer, Okta; the health insurance provider, Oscar; and the payment companies Square and Stripe .

That’s quite a string of unicorn (and would-be unicorn) investments. And it speaks to the breadth of the firm’s interests that run the gamut from healthcare to fintech to sustainability and the future of food.

Khosla will likely benefit from the surge of interest in investments that adhere to new environmental, social responsibility and corporate governance standards.

There are billions of dollars that are looking for a home that can invest along those criteria, and for the last 16 years or so, that’s exactly what Khosla Ventures has been doing.

Plenty has raised over $500 million to grow fruits and veggies indoors

Plenty‌ ‌Unlimited‌ has raised $140 million in new funding to build more vertical farms around the U.S.

The new funding, which brings the company’s total cash haul to an abundant $500 million, was led by existing investor SoftBank Vision Fund and included the berry farming giant Driscoll’s. It’s a move that will give Driscoll’s exposure to Plenty’s technology for growing and harvesting fruits and vegetables indoors.

The funding comes as Plenty has inked agreements with both its new berry-interested investor and the Albertsons grocery chain. The company also announced plans to build a new farm in Compton, California.

The financing provides plenty of cash for a company that’s seeing a cornucopia of competition in the tech-enabled cultivated crop market raising a plethora of private and public capital.

In the past month, AppHarvest has agreed to be taken public by a special purpose acquisition company in a deal that would value that greenhouse tomato-grower at a little under $1 billion. And another leafy green grower, Revol Greens, has raised $68 million for its own greenhouse-based bid to be part of the new green revolution.

Meanwhile, Plenty’s more direct competitor, Bowery Farming, is expanding its retail footprint to 650 stores, even as Plenty touts its deal with Albertsons to provide greens to 431 stores in California.

Discoll’s seemed convinced by Plenty’s technology, although the terms of the agreement with the company weren’t disclosed.

“We looked at other vertical farms, and Plenty’s technology was one of the most compelling systems we’d seen for growing berries,” said J. Miles Reiter, Driscoll’s chairman and CEO, in a statement. “We got to know Plenty while working on a joint development agreement to grow strawberries. We were so impressed with their technology, we decided to invest.”

Menlo Micro, a startup bringing semiconductor tech to the humble switch, is ready for its closeup

Sixteen years ago a group of material scientists and engineers at General Electric banded together to reinvent the circuit breaker. Now, Menlo Microsystems, the spinoff commercializing that technology, is ready to bring its revolutionary new switches to market, with huge implications for everything from 5G technologies to quantum computing.

Based in Irvine, Calif., Menlo Micro takes its name from the Menlo Park, NJ research lab where Thomas Edison patented the first light switch back in 1893 and the company’s ties to GE run deep.

Researchers at GE spent more than a decade working internally on Menlo Micro’s core technology, a novel process that applies semiconductor manufacturing techniques to the production of micro electro-mechanical systems, before spinning it out into a new business five years ago.

Using a novel alloy, Menlo Micro is able to reduce the size of the switches it makes to 50 microns by 50 microns, or roughly the width of a human hair. This miniaturization can enable hardware manufacturers to come up with completely new designs for a host of products that used to require much larger components.

“The micro electro-mechanical system that we use to make this… that’s not new,” said Russ Garcia, the company’s chief executive. “The problem was — the first level innovation is how do you take a mechanical switch like the light switch or a relay and scale that down to a wafer.”

Many companies have tried to make MEMs contact switches, spending hundreds of millions of dollars, but Garcia said that the reliability and durability of the switches was always an issue. The material science behind Menlo’s switches solves the problem, he said.

Menlo’s switches pack lots and lots of MEMS relays onto a single chip that can function like a massive mechanical relay, reducing something that was the size of a fist to something the size of a microchip.

The company’s founders think the potential uses are pretty limitless, thanks to the massive size reduction and increased durability that its switches offer.

Close up of a Menlo Micro switch. Image Credit: Menlo Micro

Initial markets for commercialization

“One way to look at this is in edge and IOT applications,” said company co-founder Chris Giovanniello, a former vice president of business development at GE Ventures and Menlo Micro’s current senior vice president of worldwide marketing.  “What we tend to think about and what most of the industry thinks about is low energy bluetooth and wifi and low power processing for decision making. Once you’ve sensed it, communicated it, and made a decision, you have to do something about it.”

Initially Menlo Micro spun out from GE with Giovanniello and co-founders including chief technology officer, Chris Keimel, and Jeff Baloun, the senior vice president of operations. Garcia, who saw the company’s initial pitch at a semiconductor conference where GE was touting the technology, was brought on board by one of Menlo Micro’s early investors Paladin Capital Group. 

Paul Conley of Paladin Capital sent me this deck and said ‘Wow there might be something there.’ We met Chris and then met up with the other Chris they wanted me to help out with strategy,” Garcia said. He wound up coming on board as a founding executive. 

Current solid state technologies tasked with making something happen based on the data currently use more power than the rest of the systems that they’re tied to. Menlo Micro’s chips would substantially reduce energy loss and improve the efficiency of entire systems, he said. 

“If you think of the light switch in your house, it’s two metal contacts that come together. If that contact is really good and clean the electricity flows through very efficiently and when you turn it off… no electricity can flow through and [nothing] happens at all,” said Garcia, a longtime executive in the MEMS industry. “In a semiconductor, there’s loss in that contact. When you run a transistor on it allows the energy to flow through but loses some of that energy in heat and when you turn it off it allows some of that energy to flow through. When you take the billions of switches… all of that incremental energy is completely lost.”

The benefits of the technology mean demand from the defense industry, which wants to put the new switches in radar, radio, and satellite networks. Commercial applications include wi-fi connectivity, 5G cell networks, for radio frequency and microwave switching. Consumers could see the switches in cell phones meaning fewer dropped calls, higher speeds and capacity for data, and longer battery life.

Menlo has already sent samples from its production line to 30 lead customers in aerospace and defense, telecommunications and testa and measurement. And the company has raised $44 million in new funding from investors including Nest founder Tony Fadell’s Future Shape Group to boost its production capacity to meet potential demand.

“The concept of an ‘ideal switch’ was theoretical – something companies have been working to  achieve for decades – until Menlo Micro,” said Marianne Wu, the former head of GE Ventures and current Managing Director of 40 North Ventures, which led Menlo Micro’s latest round. “We are incredibly excited to work with such a dynamic, experienced team on a core  technology that is disrupting nearly every industry.” 

Series of Menlo Micro switches on a circuit board. Image Credit: Menlo Micro

Thinking beyond 5G, defense and industrial IOT

Over the last 30 months, Menlo Micro said it has completed the transfer and qualification of its manufacturing process, moving from a 4-inch research fab to a new 8-inch high volume manufacturing line.

That means the company is able to increase production for its initial products and boost its capacity. With the qualification in hand, the company expects to bring production up to over 100,000 units per month by the end of 2020 and reach production capacity for millions of switches per month in 2021.

So beyond telecommunications and defense, there are target markets in energy storage, automotive, aerospace because of the miniaturization — while quantum computing companies are interested in the technology because of its durability.

“The relay is a large mechanical devices that you can hold in yourhand and used in many applications for turning on and off the power that goes to an industrial piece of equipment to your car to motors that need to be driven,” said Giovanniello. “They’re very hard to integrate because they’re so big. We can take the electrical characteristics of having a true metal to metal on low loss connection and then, when it’s open there’s an air gap that no current can flow through.. We can integrate [the switches] into completely different architectures.” 

Ultimately, Giovanniello said the go-to-market strategy is to focus on the “rule of 99”.

“We’re able to reduce the size, the weight, and the power fo the box that [the switch] is going into by up to 99%. That’s a huge improvement in infrastructure and cost,” he said.

For companies developing quantum computers, the value proposition is not just about the size of the MEMS, but the durability of the alloy that Menlo Micro has developed. “For quantum, you have to have devices that operate at close to absolute zero… Semiconductors don’t work down to those temperatures so they use old-fashioned mechanical relays [which] can take hours to get back to temperature,” Giovanniello said. “Our materials are so robust they work [at temperatures] down to a few milikelvins.”

It’s this flexibility and the potential redesign of old industrial technologies that haven’t been updated for nearly a century that has enabled the company to bring in $78 million in funding from investors including Piva, Paladin Capital Group, Vertical Venture Partners, Future Shape and strategic investors like Corning and Microsemi.

“For 40+ years, the industry has been searching for a switch that has the perfect combination of  the electromechanical relay and the silicon transistor,” said Tony Fadell, in a statement. “[This technology] is a tiny,  efficient, reliable micro-mechanical switch with unmatched RF-performance and, counterintuitively, high-power handling of 1,000s of Watts. As our world moves to the  electrification and wireless of everything, Menlo Micro’s deep innovation is already triggering  massive cross-industry upheaval.”

Genemod raises cash for its lab inventory management service used by research institutions around the US

Genemod, a software for laboratory inventory management used by institutions like the University of Washington School of Medicine; the University of California, Berkeley, and the National Institutes of Health; has raised $1.7 million from a clutch of top venture investors.

The small seed round came from Defy.vc, with additional commitments from Omicron, Unpopular Ventures, Underdog Labs and Canaan Partners.

With the capital, the company said it would develop a product management software to compliment its existing inventory management service.

These are small stepping stones on the way to paving a new road to pharmaceutical development based on collaborative data sharing technology, the company said.

It’s a road that companies like Owkin and Within3 have raised big dollars to pave already. They’re just two companies in the market that are building collaborative software for the pharmaceutical industries.

Genemod’s pitch is that it can increase productivity by giving researchers a better window into the tools they have and the tools they need to accelerate the process of experimentation without downtimes while waiting for supplies.

“While the life sciences industry is known for developing inventive solutions to some of the world’s biggest health problems, many scientists are working with manual, siloed and inefficient processes,” said Jacob Lee, the company’s chief executive.

Alongside the funding, Defy.vc will serve as a growth partner for Genemod, supporting the company as it works to roll out its product roadmap for the latter half of the year. Neil Sequeira, co-founder and managing director of Defy.vc, will join Genemod’s Board of Directors.

Founded in 2018, Genemod was part of the first cohort of Venture Out Startups, a pre-seed investment program designed to encourage entrepreneurs to start their own businesses.

Kayhan Space wants to be the air traffic control service for satellites in space

Kayhan Space, the Boulder, Colo. and Atlanta-based company launched from Techstars virtual space-focused accelerator, wants nothing more than to be the air traffic control service for satellites in space.

Founded by two childhood friends, Araz Feyzi and Siamak Hesar, who grew up in Iran and immigrated to the U.S. for college, Kayhan is tackling one of the toughest problems that the space industry will confront in the coming years — how to manage the exponentially increasing traffic that will soon crowd outer space.

There are currently around 8,000 satellites in orbit around the earth, but over the next several years, Amazon will launch 3,236 satellites for its Kuiper Network, while SpaceX filed paperwork last year to launch up to 30,000 satellites. That’s… a lot of metal flying around.

And somebody needs to make sure that those satellites don’t crash into each other, because space junk has a whole other set of problems.

In some ways, Feyzi and Hesar are a perfect pair to solve the problem.

Hesar, the company’s co-founder and chief executive, has spent years studying space travel, receiving a master’s degree from the University of Southern California in aeronautics, and a doctorate in astronautical engineering from the University of Colorado, Boulder. He interned at NASA’s Jet Propulsion Laboratory, and spent three years at Colorado-based satellite situational awareness and systems control technology developers like SpaceNav and Blue Canyon Technologies.

Meanwhile Feyzi is a serial entrepreneur who co-founded a company in the Atlanta area called Syfer, which developed technologies to secure internet-enabled consumer devices. Using Hesar’s proprietary algorithms based on research from his doctoral days at UC Boulder and Feyzi’s expertise in cloud computing, the company has developed a system that can predict and alert the operators of satellite networks when there’s the potential for a collision and suggest alternative paths to avoid an accident.

It’s a problem that the two founders say can’t be solved by automation on satellites alone, thanks to the complexity and multidimensional nature of the work. “Imagine that a US commercial satellite is on a collision course with a Russian military satellite,” Feyzi said. “Who needs to maneuver? We make sure the satellite operator has all the information available to them [including] here’s what we know about the collision about to happen here and here are the recommendations and options to avoid it.”

Satellites today aren’t equipped to visualize their surroundings and autonomy won’t solve a problem that includes geopolitical complexities and dumb space debris all creating a morass that requires human intervention to navigate, the founders said.

Today it’s too complex to resolve and because of the different nations and lack of standards and policy … today you need human input,” Hesar said.

And in the future, if satellites are equipped with sensors to make collision avoidance more autonomous, then Kayhan Space already has the algorithms that can provide that service. “If you think of the system and the sensors and the decision-making and [execution controls] actually performing that action… we are that,” Hesar said. “We have the algorithm whether it uses the ground-based sensor or the space-based sensor.”

Over the next eight years the space situational market is expected to reach $3.9 billion and there are very few companies equipped to provide the kind of traffic control systems that satellite network operators will need, the founders said.

Their argument was compelling enough to gain admission to the Techstars Allied Space Accelerator, an early stage investment and mentoring program developed by Techstars and the U.S. Air Force, the Netherlands Ministry of Defence, the Norwegian Ministry of Defence and the Norwegian Space Agency. And, as first reported in Hypeotamus, the company has now raised $600,000 in a pre-seed funding from investors including the Atlanta-based pre-seed investment firm, Overline, to grow its business.

And the company realizes that money and technology can’t solve the problem alone.

“We believe that technology alone can help but can’t solve this problem. We need the US to take the lead [on policy] globally,” said Feyzi. “Unlike airspace… which is controlled by countries. Space is space.” Hesar agreed. “There needs to be a focused effort on this problem.”

 

Commercializing the open source FingerprintJS browser fingerprinting tech nabs Chicago entrepreneur $4M

Chicago-based serial entrepreneur Dan Pinto has raised new cash and launched a new company looking to commercialize a years-old open source project that purports to solve one of the web’s hardest problems — fraud prevention.

The company he launched in January, FingerprintJS, touts itself as a new kind of toolkit offering browser fingerprinting as a service for any application.

The company, based on an open source project that already has 5 million downloads and 8,000 websites using the service (and hundreds of paying customers, according to the company), is a variation on the browser fingerprinting technology that companies have been using for years.

FingerprintJS uses the same canvas fingerprinting, audio sampling, WebGL fingerprinting, font detection and browser plugin probing tech that’s available on the market, but de-identifies the fingerprint from a specific device by generating a unique identifier of a browser without using cookies. Companies can store the identifier in their database and then track its behavior, the company said on its website.

The open source project was actually started five years ago by Valentin Vasilyev, according to the project’s Github page. Vasilyev and Pinto worked together at Pinto’s last startup, Machinio, which was sold back in 2018. The two men launched a business around Vailyev’s project in January and have raised $4 million in financing to support the commercialization of the project.

“The open source community was pivotal to our success thus far,” said Vasilyev, in a statement. “We will continue to build upon that base and focus on selling to developers first. Software engineers understand technology and are starting to recognize how effective our product is to help stop fraud.”

Funding came from Nexus Venture Partners, with participation from Hack VC, the Entrepreneur Roundtable Accelerator’s Remarkable Ventures fund and angel investors like Rony Kahan, the chair and co-founder of Indeed, according to a statement from FingerprintJS.

“FingerprintJS APIs make it possible for developers to quickly embed fraud detection and prevention capabilities into their code,” said Abhishek Sharma, principal at Nexus Venture Partners, in a statement. “We are excited to partner with the FingerprintJS team because of their product-led bottom-up technology development and distribution in a category that has historically been reliant on top-down enterprise sales.”

One potential roadblock to FingerprintJS’ growth comes from recent the General Data Protection Regulations enacted by the European Union and better known by their acronym, GDPR. Those regulations restrict the use of several browser fingerprinting and tracking technologies. Some browsers, including Chrome, Firefox, and Safari, have even set up their own controls to limit the amount of data a website can use to track visitors online.

Pinto is undeterred.

“We have a unique opportunity to disrupt the fraud technology market by enabling our customers to build fraud prevention in their applications rather than it being an afterthought just as Stripe has done with payment processing,” he said in a statement provided by the company. “Think of online fraud as a shell game where malicious users are constantly trying to hide themselves in order to commit fraud. Existing solutions try to generate a fraud score for each visitor without trying to understand who they are. We focus on uniquely identifying malicious users which directly solves the underlying fraud problem.” 

Walt Disney announces reorganization to focus on streaming

Disney is going all-in on streaming media. 

On Monday, the company announced a massive reorganization of its media and entertainment business that will focus on developing productions that will debut on its streaming and broadcast services. Disney’s media businesses, ads, and distribution, and Disney+ will now operate under the same business unit, the company said.

Its major reorganization comes just days after activist investor Dan Loeb, a major investor in the company through his Third Point Capital hedge fund, called on Disney to cancel its dividend and redirect more investments into streaming.

Wall Street has already given its seal of approval to Disney’s new move, sending the share up nearly 6% in after hours trading.

Disney’s announcement follows a significant reorganization of its release schedule to address new realities including a collapsing theatrical release business; production issues; and the runaway success of its streaming service — all caused or accelerated by the national failure to effectively address the COVID-19 pandemic.

Planned theatrical releases of would-be tentpole films like “Black Widow” have been rescheduled, while other films including “Mulan” and the upcoming Pixar film “Soul” are seeing their first runs on Disney’s streaming service, Disney+.

Production of new material for Disney’s many provinces of intellectual property will fall under three groups — Studios, General Entertainment, and Sports. Leadership of these groups won’t change with Alan F. Horn and Alan Bergman, Peter Rice and James Pitaro maintaining their respective positions within the organization, the company said.

Overseeing operations for this singularly large new operational structure will be Kareem Daniel, who previously helmed the company’s consumer products, games and publishing operations.

All of the men will report up to Bob Chapek, the company’s chief executive officer.

“Given the incredible success of Disney+ and our plans to accelerate our direct-to-consumer business, we are strategically positioning our Company to more effectively support our growth strategy and increase shareholder value,” Chapek said in a statement. “Managing content creation distinct from distribution will allow us to be more effective and nimble in making the content consumers want most, delivered in the way they prefer to consume it. Our creative teams will concentrate on what they do best—making world-class, franchise-based content—while our newly centralized global distribution team will focus on delivering and monetizing that content in the most optimal way across all platforms, including Disney+, Hulu, ESPN+ and the coming Star international streaming service.”

Studios will run all of the company’s development activities for live action and animated productions coming from Walt Disney Animation Studios, Pixar Animation Studios, Marvel Studios, Lucasfilm, 20th Century Studios and Searchlight Pictures.

General Entertainment will serve the same function for the company’s 20th Television and ABC Signature and Touchstone Television productions, along with its news divisions, Disney channels, Freeform, FX, and National Geographic.

Sports will focus on ESPN and sports productions including live events, and original, and non-scripted sports related material for cable channels, ESPN+ and ABC, the company said.

Overseeing the monetization, distribution, operations, sales, advertising and data and technology infrastructure for all of those groups will be Daniel. A longtime Disney executive, he formerly served as the head of the company’s Imagineering Operations, taking intellectual property and turning it into entertainment for the vast empire of Disney resorts and theme parks, before taking over the consumer products, games and publishing operations at the company.

“Kareem is an exceptionally talented, innovative and forward-looking leader, with a strong track record for developing and implementing successful global content distribution and commercialization strategies,” said Chapek. “As we now look to rapidly grow our direct-to-consumer business, a key focus will be delivering and monetizing our great content in the most optimal way possible, and I can think of no one better suited to lead this effort than Kareem. His wealth of experience will enable him to effectively bring together the Company’s distribution, advertising, marketing and sales functions, thereby creating a distribution powerhouse that will serve all of Disney’s media and entertainment businesses.”

The new structure is effective immediately, and the Company expects to transition to financial reporting under this structure in the first quarter of fiscal 2021.

The Company will hold a virtual Investor Day on December 10, where it will present further details of its direct-to-consumer strategies.

Hoping to be LatAm’s top digital bank for SMBs, Xepelin launches a lending and revenue management service

There’s another entrant in the startup race to provide financial services to Latin America’s small and medium-sized businesses.

Financial services have been a huge opportunity for startups coming out of Brazil, Colombia, and Mexico in recent years, and now Xepelin, a new company from Chile, is looking to join the fray.

Xepelin’s founders, Sebastian Kreis and Guillermo Molina Carvallo, launched their company with the vision of creating a new kind of online bank for Latin America’s small businesses.

Sebastian Kreis, chief executive officer, Xepelin. Image Credit: Xepelin

The company’s pitch to business owners depends on a variation of the lending tool known as factoring, where small businesses can take out loans based on the income they’re expecting to receive. In Latin America, where small businesses have limited avenues to traditional loans, according to Kreis, factoring represents a novel solution.

Xepelin already has a multi-million dollar credit line on the books in addition to a small round of initial financing and the company will be using both the credit line to bring customers in and the equity infusion to continue developing revenue management and resource planning tools for its customers.

Starting in Chile and Mexico, where the two founders have a long history in the financial services world, the company expects to become a player across the continent in line with the growth of private debt services for small businesses.

Other startups, like Portal Finance and Marco Financial are also targeting the lending markets. Like Xepelin, the two companies have secured multiple lines of credit to support their businesses.

Kreis estimates that debt financing in Latin America could grow to 70 times its current size given changes to the regulatory environment and increasing demand for digital financial services over the next decade.

In the first stage we developed the new standard for SMBs’ working capital financing in LatAm, focusing on our client’s user experience, financial needs (not only transactions) and the way they manage their working capital. Xepelin gives SMBs access to capital in an easy and efficient way.

Mexico is a good indicator of the potential size of the market, according to Kreis. There only 300,000 businesses — out of more than 6 million registered companies — have sales and account executives offering revenue management and credit lines.

These money managers ahve a portfolio of 300 companies that they work with, while mid-market companies may work with as many as 1,000 to 5,000 small businesses.

So far, Xepelin has raised $3.5 million in early stage funding from investors including Oskar Hejertonsson, Manutara Ventures, Ignacio Canals, Gonzalo Rojas, FJ Labs, Diego Fleischmann, and Daniel Undurraga. The most recent capital infusion, a $2.5 million round led by Impact Ideas VC closed earlier this month.

 

Nym Health raises $14 million for its auditable machine learning tools for automating hospital billing

A little less than two years after raising its seed round, the Israeli-based Nym Health has added another $14 million to its cash haul so it can roll out its technology developing auditable machine learning tools for automating hospital billing.

The new financing came from investors including GV (the investment arm of Google previously known as Google Ventures) and will be used by the company to expand its technology development and sales and marketing efforts across the U.S.

Billing has been a huge problem for healthcare systems in the U.S., thanks to complicated coding that needs to be entered to ensure insurance providers pay for the services medical professionals give to patients.

Nym claims to have solved the problem by developing technologies that can convert medical charts and electronic medical records from physician’s consultations into proper billing codes automatically. The company uses natural language processing and taxonomies that were specifically developed to understand clinical language to determine the optimal charge for each procedure, examination and diagnostic conducted for a patient, according to Nym.

The company was founded in 2018 by two former members of Israel’s 8200 cybersecurity unit of the army. Adam Rimon and Amihai Neiderman both wanted to work on something together and Neiderman was set on doing something in the medical space involving natural language processing. Rimon had just finished a doctorate in computational linguistics so the move into charting and medical coding seemed natural.

“Because of our approach we can generate full audit trails,” said Neiderman. “We can explain how we understood everything in patient charts.”

Having automated processes that are also auditable is important for healthcare providers in case they need to provide justification to insurance companies for the services they performed.

Nym’s software can’t address fraud if physicians are padding their bills with services they didn’t offer, but it can provide an audit and justification for the services that a hospital coded for — and potentially wring more money for hospitals that lose out thanks to improperly coded bills. “On the medical decision-making we never intervene. We assume that the physician is trying to do their best and they’re sticking to the protocol,” said Neiderman. 

Interest in developing better billing systems for healthcare is high among venture investors, considering that coding related denials of payment can cost hospitals $15 billion, according to Nym. It’s a service that brought attention not just from GV, but of Bessemer Venture Partners, Dynamic Loop Capital, Lightspeed, Tiger Global, and angel investors including Zach Weinberg and Nat Turner from Flatiron Health.

“Inaccurate coding is bad for everybody,” says Ben Robbins, a venture partner at GV.

Nym charges between $1 and $4 per chart it analyzes, and is already working with around 40 medical providers in the U.S., according to the company.