Niio announces $15M Series A following strategic partnership with Samsung Displays

Niio, a Tel Aviv-based digital art platform that offers access to digital art, from contemporary artists and galleries to NFTs, announced today it has closed $15 million Series A funding in the wake of a strategic partnership with Samsung Displays last week.

The round was co-led by L Catterton, which is a joint venture company between LVMH and Catterton, Entrée Capital and Pico Venture Partners. Additional investors also joined, including Saga VC, as well as leading artists, art collectors, museums, gallerists and trustees at institutions such as MOMA and Guggenheim as well as Shalom McKenzie, who recently acquired a CryptoPunk NFT at Sotheby’s. Prior to the Series A round, Niio had raised $8 million, initially from strategic angels, followed by a seed round from institutions in 2017.

Niio will use its capital to grow its artist community and scale its app-enabled subscription and purchase platform, which is blockchainbased and will include a trading-enabled marketplace for NFTs and other digital art assets.

“Digital art has become an accepted, mainstream medium with the market accelerating largely due to the explosive growth of NFTs,” said Niio CEO and co-founder Rob Anders. “The transformation people are experiencing is the most significant and consequential moment for culture in decades, making new kinds of art accessible and experienced on screens in ways like never before,” Anders added.

Niio’s technology enables users to stream digital artwork on any digital screen or canvas anywhere, bridging the gap between art and creating a platform similar to what music and entertainment streaming services have done for albums and movies.

Niio, founded by Rob Anders and Oren Moshe in 2014, combines an accessible streaming subscription service alongside the ability for people to purchase editioned NFT artwork directly from artists, galleries and content owners, through its public marketplace or via private transactions, Anders told TechCrunch.

Niio is launching its subscription service at the end of 2021 followed by its NFT marketplace — which makes Niio, backed by a global community of art professionals, the most comprehensive end-to-end solution for the digital art medium and ensuring that premium digital art is easily accessible by anyone on any screen, Anders continued.

By providing Niio’s tools to a global community of 6,000 galleries, institutions and artists from renowned to emerging, Niio’s platform and blockchain enables artists to require, distribute, manage and monetize and preserve their work.

Niio will be free for all artists, forever, to respect and support the creative community and artists’ ability for publishing, managing and protecting their life’s work.

“We have realized our vision for a platform that first and foremost empowers artists and enables their work to be experienced digitally and available globally. We are gratified by the trust that more than 6,000 artists have placed in us — as we enable them to publish, manage protect and monetize their life’s work,” Niio co-founder Oren Moshe said.

Approximately 10,000 global business customers have been using the Niio platform for the past two to three years, Anders said. Clients range from art professionals, including galleries, museums, studios and art schools, to luxury brands, hotel chains and real estate developers, who subscribe and display curated art streams from the 15,000 premium works available on the platform, to millions of people across public spaces and places in over 30 countries, Anders said.

“There are over 1 billion Smart TVs in the market and our partner Samsung has 30-40% of the market contributing to our ability to offer a ‘last mile’ proposition,” Anders said.

The digital art market is projected to be approximately $50 – $100 billion by 2025, according to Anders.

“The digital art has long been on our radar at L Catterton. We are very bullish on its future, and our ongoing evaluation of the sector brought us to Niio,” said Michael Farello, managing partner at L Catterton’s Growth Fund. “We are convinced that their platform approach including both subscription and an NFT offering combined with the reputation they have built in the critical artist community and the validation from their partnership with Samsung – will make them a market leader.”

Business Canvas, a Korea-based document management SaaS company, closes $2.5M seed round

Business Canvas, a South Korean document management SaaS company behind Typed, announced today it has raised a $2.5 million seed round led by Mirae Asset Venture Investment, with participation from Kakao Ventures and Nextrans Inc.

The seed round will be used for accelerating product development and global launch of open beta for its AI-powered document management platform. The company opened an office in Santa Clara, California this year to spur its global expansion.

People are bombarded with information thanks to advances in technology that opens the doors to a wealth of information, but at the same time, too much information and a huge amount of data at one time leave the users confused and/or unable to make timely decisions.

Business Canvas, founded in July 2020 by CEO Woojin Kim, Brian Shin, Seungmin Lee, Dongjoon Shin and Clint Yoo, is hoping to solve the challenge that every knowledge worker and writer faces: spending more time on research and file organization than the actual content output they need to create.

“In fact, people commit over 30% of their working hours trying to search for that file we once saved in a folder that we just cannot find anymore,” Business Canvas CEO and co-founder Kim said.

Through a network that intelligently tracks and organizes files based on the user’s interactions, Typed brings all the knowledge from different websites and applications into one simple-to-use and quick-to-learn digital workspace.

Strictly keeping its users’ information and their confidential files uninterrupted, Typed does not access the content of users’ documents but utilize them as machine learning data in order to protect their information and data, Kim told TechCrunch. It simply collects users’ action driven data point and publicly available metadata of documents and resources under users’ permission, Kim added.

“Modern document writing has not changed since the 1980s,” Business Canvas co-founder Clint Yoo said. “While we have more knowledge at our fingertips than ever before, we use the same rudimentary methods to organize and make sense of it. We want any writer – from lawyers and entrepreneurs to researchers and students – to focus on creating great content instead of wasting time organizing their source material. We achieved this by making knowledge management more like the way our brain operates.”

Since the launch of the closed beta test in February 2021, Typed saw significant user growth including more than 10,000 users on the waitlist, with 25,000 files uploaded and 350% month-over-month active user growth, the company said in its statement. Typed will be available through a freemium model and is currently accepting beta registrations on its website.

“When we’ve tested our closed beta, our metrics show top traction among students as well as journalists, writers and lawyers, who require heavy research and document work on a frequent basis. We opened up access earlier this month for the waitlists in over 50 countries. These are primarily B2C users,” Kim told TechCrunch. “As for B2B, we are currently in the process of proof-of-concept (POC) for one of the largest conglomerates in South Korea. Smaller teams like startups, boutique law, consulting firms, venture capitals and government institutions also have been adopting Typed as well.”

“While the company is still in its nascent stage in its development, Typed has the potential to fundamentally change how we work individually or as a team. If there is a business to take on our outdated way of writing content, it’s them [Typed],” Shina Chung, Kakao Ventures CEO said.

The global market size for social software and collaboration SaaS is estimated at $4.5 billion in 2021, increasing over 17% year on year, Kim said.

UK’s MarketFinance secures $383M to fuel its online loans platform for SMBs

Small and medium businesses regularly face cashflow problems. But if that’s an already-inconvenient predicament, it has been exacerbated to the breaking point for too many during the Covid-19 pandemic. Now, a UK startup called MarketFinance — which has built a loans platform to help SMBs stay afloat through those leaner times — is announcing a big funding infusion of £280 million ($383 million) as it gears up for a new wave of lending requests.

“It’s a good time to lend, at the start of the economic cycle,” CEO and founder Anil Stocker said in an interview.

The funding is coming mostly in the form of debt — money loaned to MarketFinance to in turn loan out to its customers as an approved partner of the UK government’s Recovery Loan Scheme; and £10 million ($14 million) of it is equity that MarketInvoice will be using to continue enhancing its platform.

Italian bank Intesa Sanpaolo S.p.A. and an unnamed “global investment firm” are providing the debt, while the equity portion is being led by Black River Ventures (which has also backed Marqeta, Upgrade, Coursera and Digital Ocean) with participation from existing backer, Barclays Bank PLC. Barclays is a strategic investor: MarketFinance powers the bank’s online SMB loans service. Other investors in the startup include Northzone.

We understand that the company’s valuation is somewhere in the region of under $500 million, but more than $250 million, although officially it is not disclosing any numbers.

Stocker said that MarketFinance has been profitable since 2018, one reason why it’s didn’t give up much equity in this current tranche of funding.

“We are building a sustainable business, and the equity we did raise was to unlock better debt at better prices,” he said. “It can help to post more equity on the balance sheet.” He said the money will be “going into our reserves” and used for new product development, marketing and to continue building out its API connectivity.

That last development is important: it taps into the big wave of “embedded finance” plays we are seeing today, where third parties offer, on their own platforms, loans to customers — with the loan product powered by MarketFinance, similar to what Barclays does currently. The range of companies tapping into this is potentially as vast as the internet itself. The promise of embedded finance is that any online brand that already does business with SMEs could potentially offer those SMEs loans to… do more business together.

MarketFinance began life several years ago as MarketInvoice, with its basic business model focused on providing short-term loans to a given SMB against the value of its unpaid invoices — a practice typically described as invoice finance. The idea at the time was to solve the most immediate cashflow issue faced by SMBs by leveraging the thing (unpaid invoices, which typically would eventually get paid, just not immediately) that caused the cashflow issue in the first place.

A lot of the financing that SMBs get against invoices, though, is mainly in the realm of working capital, helping companies make payroll and pay their own monthly bills. But Stocker said that over time, the startup could see a larger opportunity in providing financing that was of bigger sums and covered more ambitious business expansion goals. That was two years ago, and MarketInvoice rebranded accordingly to MarketFinance. (It still very much offers the invoice-based product.)

The timing turned out to be fortuitous, even if the reason definitely has not been lucky: Covid-19 came along and completely overturned how much of the world works. SMEs have been at the thin edge of that wedge not least because of those cashflow issues and the fact that they simply are less geared to diversification and pivoting due to shifting market forces because of their size.

This presented a big opportunity for MarketInvoice, it turned out.

Stocker said that the early part of the Covid-19 pandemic saw the bulk of loans being taken out to manage business interruptions due to Covid-19. Interruptions could mean business closures, or they could mean simply customers no longer coming as they did before, and so on. “The big theme was frictionless access to funding,” he said, using technology to better and more quickly assess applications digitally with “no meetings with bank managers” and reducing the response time to days from the typical 4-6 weeks that SMBs would have traditionally expected.

If last year was more about “panicking, shoring up or pivoting,” in Stocker’s words, “now what we’re seeing are a bunch of them struggling with supply chain issues, Brexit exacerbations and labor shortages. It’s really hard for them to manage all that.”

He said that the number of loan applications has been through the roof, so no shortage of demand. He estimates that monthly loan requests have been as high as $500 million, a huge sum for one small startup in the UK. It’s selective in what it lends: “We choose to support those we thought will return the money,” he said.

Cartona gets $4.5M pre-Series A to connect retailers with suppliers in Egypt

Year-old startup Capiter announced last week that it raised a $33 million Series A to digitize Egypt’s traditional offline retail market.

It’s looking to take a large pie in the budding e-commerce and retail play, where multiple startups are pulling their weight including Cartona, also a year-old startup out of Egypt.

Today, Cartona is announcing that it has raised a $4.5 million pre-Series A funding round to connect retailers and manufacturers via an application.

The company confirmed that Dubai-based venture capital firm Global Ventures led the round, with Pan-African firm Kepple Africa, T5 Capital and angel investors also participating.

Cairo-based Cartona, founded in August 2020, focuses on solving the supply-chain and operational challenges of players in the fast-moving consumer goods (FMCG) industry by helping buyers access products from sellers on a single platform.

Buyers, in this case, are retailers, while sellers are FMCG companies, distributors and wholesalers.

The problem retailers in Egypt and most of Africa face mainly revolves around limited access to suppliers. There are also issues around transparency in market prices, which are dependent on traditional logistical capabilities.

For suppliers, the lack of data and inability to make data-backed decisions to improve margins and aid growth add up to unoptimized warehouses. 

“The trade market is completely inefficient and it’s not good for the supplier nor the manufacturers, and it’s definitely not good for retailers,” CEO Mahmoud Talaat told TechCrunch in an interview. “So we came up with the idea of Cartona, which is basically a fully light-asset model that connects manufacturers and wholesalers to retailers.”

Talaat founded the company alongside Mahmoud Abdel-Fattah. Before Cartona, Abdel-Fattah founded Speakol, a MENA-focused adtech platform serving 60 million monthly users, while Talaat was the chief commercial officer of agriculture company Lamar Egypt.

Cartona works as an asset-light marketplace. On the platform, grocery retailers can get orders from a curated network of sellers. The company says this way, it can provide visibility through real-time price comparisons and clarity on delivery times.

Also, FMCGs and suppliers can optimize their go-to-market execution through the use of data and analytics. Cartona tops it off by providing embedded finance and access to credit to retailers and suppliers.

Cartona makes money through all these processes. It takes a commission on orders made, charges suppliers for running advertising to merchants (since they compete for the latter’s attention), and provides market insights on buyer behavior, price competition and market share.

“It is time to capitalize on technology beyond warehouses and trucks. Data and technology will transform traditional retail to a digitally native one, which in return will drastically improve the supply chain efficiency,” Abdel-Fattah said about how the company sells information to retailers and suppliers.

Cartona has over 30,000 merchants on its platform. Together, they have processed more than 400,000 orders with an annualized gross merchandise value of EGP 1 billion (~$64 million). Cartona also works with more than 1,000 distributors, wholesalers and 100 FMCG companies, offering consumers more than 10,000 products, including dry, fresh and frozen food.

The company’s business and revenue model is similar to other companies in this space, but the main difference lies in whether they own assets or not.

Taking a look at the players in Egypt, for instance, MaxAB operates its warehouses and fleets; Capiter uses a hybrid model in which it rents these assets and owns inventory when dealing with high-turnover products. But Cartona solely manages an asset-light model.

The CEO tells me that he thinks this model works best for all the stakeholders involved in the retail market. He argues that not owning assets and leasing the ones on the ground shows that the company is trying to improve the operations of existing suppliers and merchants instead of displacing them.

I believe that the infrastructure already exists. We already have many warehouses, many small and medium-sized entrepreneurs, and wholesalers and distributors and companies that have a lot of assets. If you want to fix the problem, we think one should enable the people who are strategically located in small streets all over Egypt and have the infrastructure but don’t have the technology needed to optimize their warehouses and carts.”

The current margins for suppliers with warehouses are slim, and Cartona provides the technology — an inventory and ordering system — to provide efficiency in its supply chain.

The general partner at lead investor Global Ventures, Basil Moftah, said in a statement that Cartona’s technology and not owning inventory proved critical in the firm’s decision to back the company.

“The trade market is one of the most sophisticated, yet [it is] characterized by multiple critical inefficiencies across the value chain,” he said.Cartona’s asset-light approach tackles those inefficiencies by optimizing the trade process in unique ways and does so with minimal capital spent.”

Proceeds of the investment focus on improving this technology, Talaat said. In addition, Cartona is expanding its team and operations beyond two cities in Egypt — Cairo and Alexandria — to other parts.

A longer-term plan might include horizontal and vertical product expansion into pharmaceuticals, electronics and fashion.

TrueLayer nabs $130M at a $1B+ valuation as open banking rises as a viable option to card networks

Open banking — a disruptive technology that seeks to bypass the dominance of card networks and other traditional financial rails by letting banks open their systems directly to developers (and new services) by way of APIs — continues to gain ground in the world of financial services. As a mark of that traction, a startup playing a central role in open banking applications is announcing a big round of funding with a milestone valuation.

TrueLayer, which provides technology for developers to enable a range of open-banking-based services — these currently include payments  payouts, user account information and user verification — has raised $130 million in a funding round that values the London-based startup at over $1 billion.

Tiger Global Management is leading the round, and notably, payments juggernaut Stripe is also participating.

Open Banking is a relatively new area in the world of fintech — the UK was an early adopter in 2018, Europe then signed on, and it looks like we are now seeing more movements that the U.S. may soon also join the party — and TrueLayer is considered a pioneer in the space.

The vast majority of transactions today are still made using card rails or more antiquated banking infrastructure, but the opportunity with open banking is to build a completely new infrastructure that works more efficiently, and might come with less (or no) fees for those using it, with the perennial API promise: all by way of few lines of code.

“We had a vision that finance should be opened up, and we are actively woking to remove the frictions that exist between intermediaries,” said CEO Francesco Simoneschi, who co-founded the company with Luca Martinetti (who is now the CTO), in an interview. “We want a financial system that works for everyone, but that hasn’t been the case up to now. The opportunity emerged five years ago, when open banking came into law in the UK and then elsewhere, to go after the most impressive oligopoly: the card networks and everything that revolves around them. Now, we can easily say that open banking is becoming a viable alternative to that.”

It seems that the world of finance and commerce is slowly catching on, and so the funding is coming on the heels of some strong growth for the company.

The startup says it now has “millions” of consumers making open banking transactions enabled by TrueLayer’s technology, and some 10,000 developers are building services based on open banking standards. TrueLayer so far this year has doubled its customer base, picking up some key customers like Cazoo to enable open-banking based payments for cars; and it has processed “billions” of dollars in payments, with payment volume growing 400%, and payment up 800%.

The plan is to use the funding to invest in building out that business further — specifically to extend its payments network to more regions (and more banks getting integrated into that network), as well as to bring on more customers using open banking services for more regular, recurring transactions.

“The shift to alternative payment methods is accelerating with the global growth of online commerce, and we believe TrueLayer will play a central role in making these payment methods more accessible,” said Alex Cook, partner, Tiger Global, in a statement. “We’re excited to partner with Francesco, Luca and the TrueLayer team as they help customers increase conversion and continue to grow the network.”

Notably, Stripe is not a strategic investor in TrueLayer at the moment, just a financial one. That is to say, it has yet to integrate open banking into its own payments infrastructure.

But you can imagine how it would be interested in it as part of the bigger mix of options for its customers, and potentially also to build its own standalone financial rails that well and truly compete with those provided by the card networks (which are such a close part of what Stripe does that its earliest web design was based on the physical card, and even its name is a reference to the stripe on the back of them.

There are other providers of open banking connectivity in the market today — Plaid out of the U.S. is one notable name — but Simoneschi believes that Stripe and TrueLayer on the same page as companies.

“We share a profound belief that progress comes through the eyes of developers so it’s about delivering the tools they need to use,” he he said. “We are in a very complementary space.”

Salesforce backs Indian payments startup Razorpay

Six-year-old Bangalore-based fintech Razorpay, which was valued at $3 billion in a financing round in April this year, has courted one more high-profile investor: Salesforce Ventures.

Razorpay said on Monday it has received a “strategic investment” from the venture arm of the American enterprise giant. The investment will help the startup “further strengthen its presence in the business banking space,” it said.

The two firms didn’t disclose the size of the investment, but Sequoia Capital India-backed startup said the deal will “make an impactful contribution to the industry and drive adoption and financial growth for underserved small businesses in the next twelve months.”

Razorpay accepts, processes and disburses money online for small businesses and enterprises — essentially everything Stripe does in the U.S. and several other developed markets. But the Indian startup’s offering goes much further than that: in recent years, Razorpay has launched a neobanking platform to issue corporate credit cards, and it also offers businesses working capital.

With the global giant Stripe still nowhere in the Indian picture, Razorpay has grown to become the clear market leader.

“At Razorpay, we want to make further strides on the idea of investing in India’s digital future and building an intelligent payment and banking infrastructure for the new- world. We are delighted to associate with Salesforce Ventures and Salesforce more broadly in India,” said Harshil Mathur, co-founder and chief executive of the fintech startup.

“I am certain that this investment, along with support from our existing investors will help build an ecosystem for a hassle-free, easy-to-integrate payments and banking experience. We also hope to expand, build new products and deliver this experience to businesses in South East Asian countries too.”

Monday’s deal is Salesforce Ventures’ second investment in the Indian startup ecosystem. The firm led a $15 million Series C financing round in Hyderabad-headquartered Darwinbox earlier this year.

“The journey towards a ‘less-cash’ economy has been accelerated with the pandemic. The rapid growth in digital payments over the last year has opened doors for technology innovation and Razorpay has been emerging as the company of choice for a lot of e-commerce businesses,” said Arundhati Bhattacharya, chairperson and chief executive of Salesforce India, in a statement.

“We are excited to support Razorpay in their journey to revolutionize digital finance not only in India, but globally as well,” added Bhattacharya, who joined the firm last year.

The Indian startup, which became a unicorn a year ago, said it has witnessed a 40-45% month-on-month growth in recent months. The startup is currently in the market to raise a new financing round and is negotiating a considerably larger valuation bump over the current value, according to a person familiar with the matter.

Bzaar bags $4M to enable US retailers to source home, lifestyle products from India

Small businesses in the U.S. now have a new way to source home and lifestyle goods from new manufacturers. Bzaar, a business-to-business cross-border marketplace, is connecting retailers with over 50 export-ready manufacturers in India.

The U.S.-based company announced Monday that it raised $4 million in seed funding, led by Canaan Partners, and including angel investors Flipkart co-founder Binny Bansal, PhonePe founders Sameer Nigam and Rahul Chari, Addition founder Lee Fixel and Helion Ventures co-founder Ashish Gupta.

Nishant Verman and Prasanth Nair co-founded Bzaar in 2020 and consider their company to be like a “fair without borders,” Verman put it. Prior to founding Bzaar, Verman was at Bangalore-based Flipkart until it was acquired by Walmart in 2018. He then was at Canaan Partners in the U.S.

“We think the next 10 years of global trade will be different from the last 100 years,” he added. “That’s why we think this business needs to exist.”

Traditionally, small U.S. buyers did not have feet on the ground in manufacturing hubs, like China, to manage shipments of goods in the same way that large retailers did. Then Alibaba came along in the late 1990s and began acting as a gatekeeper for cross-border purchases, Verman said. U.S. goods imports from China totaled $451.7 billion in 2019, while U.S. goods imports from India in 2019 were $87.4 billion.

Bzaar screenshot. Image Credits: Bzaar

Small buyers could buy home and lifestyle goods, but it was typically through the same sellers, and there was not often a unique selection, nor were goods available handmade or using organic materials, he added.

With Bzaar, small buyers can purchase over 10,000 wholesale goods on its marketplace from other countries like India and Southeast Asia. The company guarantees products arrive within two weeks and manage all of the packaging logistics and buyer protection.

Verman and Nair launched the marketplace in April and had thousands users in three continents purchasing from the platform within six months. Meanwhile, products on Bzaar are up to 50% cheaper than domestic U.S. platforms, while SKU selection is growing doubling every month, Verman said.

The new funding will enable the company to invest in marketing to get in front of buyers and invest on its technology to advance its cataloging feature so that goods pass through customs seamlessly. Wanting to provide new features for its small business customers, Verman also intends to create a credit feature to enable buyers to pay in installments or up to 90 days later.

“We feel this is a once-in-a-lifetime shift in how global trade works,” he added. “You need the right team in place to do this because the problem is quite complex to take products from a small town in Vietnam to Nashville. With our infrastructure in place, the good news is there are already shops and buyers, and we are stitching them together to give buyers a seamless experience.”

 

Airwallex raises $200M at a $4B valuation to double down on business banking

Business, now more than ever before, is going digital, and today a startup that’s building a vertically integrated solution to meet business banking needs is announcing a big round of funding to tap into the opportunity. Airwallex — which provides business banking services both directly to businesses themselves, as well as via a set of APIs that power other companies’ fintech products — has raised $200 million, a Series E round of funding that values the Australian startup at $4 billion.

Lone Pine Capital is leading the round, with new backers G Squared and Vetamer Capital Management, and previous backers 1835i Ventures (formerly ANZi), DST Global, Salesforce Ventures and Sequoia Capital China, also participating.

The funding brings the total raised by Airwallex — which has head offices in Hong Kong and Melbourne, Australia — to date to $700 million, including a $100 million injection that closed out its Series D just six months ago.

Airwallex will be using the funding both to continue investing in its product and technology, as well as to continue its geographical expansion and to focus on some larger business targets. The company has started to make some headway into Europe and the UK and that will be one big focus, along with the U.S.

The quick succession of funding, and that rising valuation, underscore Airwallex’s traction to date around what CEO and co-founder Jack Zhang describes as a vertically integrated strategy.

That involves two parts. First, Airwallex has built all the infrastructure for the business banking services that it provides directly to businesses with a focus on small and medium enterprise customers. Second, it has packaged up that infrastructure into a set of APIs that a variety of other companies use to provide financial services directly to their customers without needing to build those services themselves — the so-called “embedded finance” approach.

“We want to own the whole ecosystem,” Zhang said to me. “We want to be like the Apple of business finance.”

That seems to be working out so far for Airwallex. Revenues were up almost 150% for the first half of 2021 compared to a year before, with the company processing more than US$20 billion for a global client portfolio that has quadrupled in size. In addition to tens of thousands of SMEs, it also, via APIs, powers financial services for other companies like GOAT, Papaya Global and Stake.

Airwallex got its start like many of the strongest startups do: it was built to solve a problem that the founders encountered themselves. In the case of Airwallex, Zhang tells me he had actually been working on a previous start-up idea. He wanted to build the “Blue Bottle Coffee” of Asia out of Hong Kong, and it involved buying and importing a lot of different materials, packaging and of course coffee from all around the world.

“We found that making payments as a small business was slow and expensive,” he said, since it involved banks in different countries and different banking systems, manual efforts to transfer money between them and many days to clear the payments. “But that was also my background — payments and trading — and so I decided that it was a much more fascinating problem for me to work on and resolve.”

Eventually one of his co-founders in the coffee effort came along, with the four co-founders of Airwallex ultimately including Zhang, along with Xijing Dai, Lucy Liu and Max Li.

It was 2014, and Airwallex got attention from VCs early on in part for being in the right place at the right time. A wave of startups building financial services for SMBs were definitely gaining ground in North America and Europe, filling a long-neglected hole in the technology universe, but there was almost nothing of the sort in the Asia Pacific region, and in those earlier days solutions were highly regionalized.

From there it was a no-brainer that starting with cross-border payments, the first thing Airwallex tackled, would soon grow into a wider suite of banking services involving payments and other cross-border banking services.

“In last 6 years, we’ve built more than 50 bank integrations and now offer payments 95 countries payments through a partner network,” he added, with 43 of those offering real-time transactions. From that, it moved on the bank accounts and “other primitive stuff” with card issuance and more, he said, eventually building an end-to-end payment stack. 

Airwallex has tens of thousands of customers using its financial services directly, and they make up about 40% of its revenues today. The rest is the interesting turn the company decided to take to expand its business.

Airwallex had built all of its technology from the ground up itself, and it found that — given the wave of new companies looking for more ways to engage customers and become their one-stop shop — there was an opportunity to package that tech up in a set of APIs and sell that on to a different set of customers, those who also provided services for small businesses. That part of the business now accounts for 60% of Airwallex’s business, Zhang said, and is growing faster in terms of revenues. (The SMB business is growing faster in terms of customers, he said.)

A lot of embedded finance startups that base their business around building tech to power other businesses tend to stay arm’s length from offering financial services directly to consumers. The explanation I have heard is that they do not wish to compete against their customers. Zhang said that Airwallex takes a different approach, by being selective about the customers they partner with, so that the financial services they offer would never be the kind that would not be in direct competition. The GOAT marketplace for sneakers, or Papaya Global’s HR platform are classic examples of this.

However, as Airwallex continues to grow, you can’t help but wonder whether one of those partners might like to gobble up all of Airwallex and take on some of that service provision role itself. In that context, it’s very interesting to see Salesforce Ventures returning to invest even more in the company in this round, given how widely the company has expanded from its early roots in software for salespeople into a massive platform providing a huge range of cloud services to help people run their businesses.

For now, it’s been the combination of its unique roots in Asia Pacific, plus its vertical approach of building its tech from the ground up, plus its retail acumen that has impressed investors and may well see Airwallex stay independent and grow for some time to come.

“Airwallex has a clear competitive advantage in the digital payments market,” said David Craver, MD at Lone Pine Capital, in a statement. “Its unique Asia-Pacific roots, coupled with its innovative infrastructure, products and services, speak volumes about the business’ global growth opportunities and its impressive expansion in the competitive payment providers space. We are excited to invest in Airwallex at this dynamic time, and look forward to helping drive the company’s expansion and success worldwide.”

9am.health launches with $3.7M to tackle virtual diabetes care

Founders like to create companies around what they know, and Frank Westermann and Anton Kittelberger know diabetes.

They met and bonded over both having type 1 diabetes — Westermann was diagnosed over 25 years ago — and started the MySugr app for diabetes self-management in 2012 (they won a TC pitch-off back in 2011). Four years later, Westermann moved to the U.S. from Austria to introduce MySugr stateside before the company was acquired by Roche for $100 million in 2017.

The pair moved on to their next journey, also in diabetes, starting 9am.health in April, a virtual diabetes clinic designed to provide people living with prediabetes and type 2 diabetes access to personalized care and affordable medications from their homes. 9am.health’s clinic was launched in August.

Today, the San Diego-based company announced a $3.7 million seed round from Founders Fund, Define Ventures, Speedinvest and iSeed Ventures to target the 1 in 3 people living with diabetes in the United States, Westermann told TechCrunch.

“We understand the day-to-day challenges that people with prediabetes and type 2 diabetes have,” he added. “Access to care is the real issue, and rather than have patients wait weeks to get an appointment, we send a kit with tests to your home, and you send it back to us.”

9am.health kicked off in Texas and California, and is now available in 33 states. It is finding patients through digital outreach, community work and hospitals.

Even with insurance, the average person living with diabetes spends about $16,750 per year on medical expenses and has approximately 2.3 times higher the costs than if they didn’t have the disease. Instead, patients can subscribe to 9am.health for $40 per month; that includes online prescription shipping, unlimited personal medical care, medications to manage diabetes, hypertension or hyperlipidemia and at-home lab tests.

Westermann sees other companies working in the diabetes space, but says 9am.health is unique in providing “a digital front door for entire diabetes care,” while others focus on specific pain points. By taking that whole approach, he sees opportunity in going beyond diabetes to the general chronic disease realm as many living with diabetes — 98% of Americans in fact — also have other comorbidities like high blood pressure, high cholesterol and mental health issues, he added.

The new funding will enable the company to grow its team and carve out some of the digital diabetes market share that was valued at $13 billion in 2020 and is forecasted to grow annually by 18.8% through 2027. 9am.health will also invest in advancing its virtual screening ability and expand the types of medication it can offer.

9am.health diabetes kit

“We want to tear down the barriers and make care as easy as possible and managing diabetes part of life,” Westermann said. “When you live with chronic illness, it is an everyday thing, and sometimes you feel good, and others days you don’t. That’s why we named the company 9am.health because you can wake up at 9 a.m. and start your diabetes journey all over again.”

Lynne Chou O’Keefe, founder and managing partner at Define Ventures, says the future of healthcare is going to be more consumer-focused and will be wrapped around the patient’s care journey. She considers 9am.health to be leading this type of care with a platform that bundles education, community, coaching and care that is direct-to-consumer.

Chou O’Keefe has been investing in healthcare her entire VC career, and sat on the board of Livongo for four years. Through that experience she learned how patients struggle with their care decisions, and finds 9am.health’s founders to have a similar deep expertise and understanding in diabetes, especially with the success they had with MySugr.

“The last place you should receive healthcare is in the doctor’s office, while the first place should be wherever you are,” she added. “This is a very different way than what the healthcare system is today. We feel that people want to manage their diabetes, but then go on and live their lives.”

 

FloBiz raises $31 million to scale its neobank for small businesses in India

FloBiz, an Indian startup that is building a neobank for small- and medium-sized businesses in the South Asian market, said on Monday it has raised $31 million in a new financing round as it works to broaden its product offerings.

Sequoia Capital India and Think Investments co-led the 18-month-old startup’s Series B financing round. Existing investors Elevation Capital and Beenext also participated in the round, which brings FloBiz‘s all-time raise to over $41 million.

The startup’s marquee offering — called myBillBook — helps small- and medium-sized businesses digitize their invoicing, streamline business accounting, and automate workflows of their enterprises.

India, the world’s second largest internet market, is home to millions of small- and medium-sized businesses. Scores of startups have launched neobanks in the country in recent years to focus on serve millennials or businesses.

“SME-focussed neobanks are building engagement with business- clients through their ability to provide solutions like automated invoicing, collections/payments, accounting, inventory and sales management, taxes and in some cases interest on current deposits as well (banks can’t pay interest). This may help to ramp- up and upfront their monetisation prospects,” analysts at Jefferies wrote in a report to clients last week.

myBillBook, which supports Hindi, Gujarati and Tamil as well as English, will add support for “at least” five more regional languages within the next six months, the startup said, adding that the app has been downloaded over 5 million times.

“The product will also see deeper use of technologies like AI & image processing to make the onboarding process for the less tech-savvy SMB owners in tier 2 and tier 3 cities of India a delightful first step to digital accounting,” the startup said.

Scores of high-profile entrepreneurs — including Vijay Shekhar Sharma of Paytm, Kunal Shah of CRED, Jiten Gupta of Jupiter, Amrish Rau of Pine Labs, Krishnan Menon of BukuKas, and Nitin Gupta of Uni Cards — have also backed FloBiz in the new financing round.

“Small businesses are the real heroes of our economy. In order to power the SMB economy with technology, one needs deep understanding, instinct and empathy for this audience,” said Tejeshwi Sharma, Managing Director of Sequoia Capital India, in a statement.

“We are really impressed by the user centricity, product focus and experimentative approach of the FloBiz founders. There is almost a perfect founder market fit. The team is stoked to partner with FloBiz on their mission of building a neobank for the growing SMBs of India.”

Rahul Raj, co-founder and chief executive of FloBiz, said the startup will deploy the fresh capital to “accelerate projects which have been in the works up till now – building personalisable modules & features into myBillBook, diversifying core product offerings and preparing to roll out financial services. We have a slew of developments in the pipeline to further delight our SMB partners in the next 12 months.”