Startups Weekly: Part & Parcel plans plus-sized fashion empire

Hello and welcome back to Startups Weekly, a weekend newsletter that dives into the week’s noteworthy startups and venture capital news. Before I jump into today’s topic, let’s catch up a bit. Last week, I wrote about Stripe’s grand plans. Before that, I noted Peloton’s secret weapons

Remember, you can send me tips, suggestions and feedback to [email protected] or on Twitter @KateClarkTweets. If you don’t subscribe to Startups Weekly yet, you can do that here.

Startup spotlight

The best companies are built by people who have personally experienced the problem they’re attempting to solve. Lauren Jonas, the founder and chief executive officer of Part & Parcel, is intimately familiar with the struggles faced by the women she’s building for.

San Francisco-based Part & Parcel is a plus-sized clothing and shoe startup providing dimensional sizing to women across the U.S. The company operates a bit differently than your standard direct-to-consumer business by seeking to include the women who wear and evangelize the Part & Parcel designs by giving them a cut of their sales.

Here’s how it works: Ambassadors sign up to receive signature styles from Part & Parcel, which they then share and sell to women in their network. Ultimately, the sellers are eligible to receive up to 30% of the profit per sale. The out-of-the-box model, which might remind you somewhat of Mary Kay or Tupperware’s business strategy, is meant to encourage a sense of community and usher in a new era in which plus-sized women can facilitate other plus-sized women’s access to great clothes. 

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“I bought a brown men’s polyester suit and wore it to an interview,” Jonas, an early employee at Poshmark and the long-time author of the popular blog, ‘The Pear Shape,’ tells TechCrunch. “I was that kid wearing a men’s suit.”

Clothing tailored to plus-sized women has long been missing from the retail market. Increasingly, however, new brands are building thriving businesses by catering precisely to the historically forgotten demographic. Dia&Co., for example, raised another $70 million in venture capital funding last fall from Sequoia and USV. And Walmart recently acquired another brand in the space, ELOQUII, for an undisclosed amount. Part & Parcel, for its part, has raised $4 million in seed funding in a round led by Lightspeed Venture Partners’ Jeremy Liew.

The startup launched earlier this year in Anchorage, “a clothing desert,” and has since grown its network to include women in several other underserved markets. Given her own history struggling to find a fitted woman’s suit, Jonas launched her line with structured pieces, including suits and blouses — though the startup’s biggest success yet, she says, has been its boots, which come in three different calf width options.

“Seventy percent of women in this country are plus-sized,” Jonas said. “I’m bringing plus out of the dark corner of the department store.”

This week in VC

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Image: Bryce Durbin / TechCrunch

Must read

TechCrunch’s Megan Rose Dickey published a highly anticipated deep dive on the state of sex tech this week. The piece provides new data on funding in sex tech and wellness companies, analysis on sex tech startup’s battle for public advertising and responses from industry leaders on how we can destigmatize sex with technology. Here’s a short passage from the story:

Cindy Gallop sees a market opportunity in every type of business obstacle she encounters. That’s why All The Sky will also seek to invest in startups that tackle the infrastructural tools needed to fuel sextech, like payments, hosting providers and e-commerce sites.

“I want to fund the sextech ecosystem to maintain and sustain a portfolio for All the Skies, to create a bloody huge sextech ecosystem and three, to monopolistically build out the ecosystem to be a multi-trillion-dollar market,” Gallop says.

On my radar

I swung by Contrary Capital‘s Demo Day this week, in which a number of startups gave a 4- to 5-minute pitch. Next on my list is Alchemist‘s Demo Day in Menlo Park. The accelerator welcomes enterprise startups for a six-month program focused on early customer adoption, company development and mentorship.

Also on my radar is Females To The Front. The event began this week in Palm Springs and if I were based in SoCal, I would have swung by. Led by Amy Margolis, the event is said to be the largest gathering of female cannabis founders and funders to date. Here’s how the group describes the event: “Females to the Front Retreat will mix immersive and hands-on workshops, pitch training, investment deck preparation and business skill set education with investor meetings and plenty of shared meals, pool time, yoga, connections, rest and rejuvenation. Every workshop is built to directly engage attendees instead of powerpoint and panels. Be prepared to return home inspired, engaged and with so many more tools in your toolbox.”

For the record, I don’t advertise events in my newsletter just wanted to give props to this one because it’s a great development for the cannabis tech ecosystem.

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Time to Disrupt

We are just weeks away from our flagship conference, TechCrunch Disrupt San Francisco. We have dozens of amazing speakers lined up. In addition to taking in the great line-up of speakers, ticket holders can roam around Startup Alley to catch the more than 1,000 companies showcasing their products and technologies. And, of course, you’ll get the opportunity to watch the Startup Battlefield competition live. Past competitors include Dropbox, Cloudflare and Mint… You never know which future unicorn will compete next.

You can take a look at the full agenda here. And if you still need convincing, here’s five reasons to attend this year’s conference from our COO himself.

And finally… #EquityPod

This week, the lovely Alex Wilhelm, editor-in-chief of Crunchbase News, and I gathered to discuss a number of topics including WeWork’s IPO and Uber’s attempts to bypass a new law meant to protect gig workers. Listen here.

YC-backed Brave Care raises $5 million for pediatric urgent care clinics

Brave Care, the YC-backed urgent care clinic for kids, has today announced the close of a $5 million seed round of funding.

The company recently graduated out of the last batch of Y Combinator companies but sat out of demo day because the this round was already oversubscribed, according to cofounder Darius Monsef .

Investors that participated in the round include Sesame Street (via their partnership with VC Collaborative Fund), Greycroft, Refactor, and Fifty Years.

Portland-based Brave Care launched in July with the goal of creating a pediatric-focused urgent care clinic that could both serve companies and save them from spending thousands of dollars on visits to the emergency room.

In 2015, there were approximately 30 million pediatric emergency room visits in the United States — 96.7% of them were treat-and-release visits.

Brave Care wants to be there for parents and kids when the situation calls for something in between their regular doctor and the emergency room.

The facility was built specifically for children. The waiting rooms are kid-friendly, the instruments in the patient rooms are kid-sized, and the general philosophy behind Brave focuses on taking extra time to clarify the diagnosis and the treatment options clearly and patiently to parents.

The company also has plans to introduce a triage tool that walks parents through symptoms and helps them decide if they should head to an urgent care clinic or straight to the Emergency Room.

The funding will allow Brave to build out a new electronic health records system that would streamline check-in, communication with parents during and after a visit, and help physicians and nurses spend more time focused on the patient and less time typing out notes on their computers.

“We can’t build a tech-enabled health care business on someone else’s platform,” said Monsef.

Moreover, Brave will use the funding to open up new, more lightweight facilities in the Portland area that can act as spokes to the main hub facility, where the company has expensive but not oft-used equipment like an X-ray machine or a full-service lab.

YC-backed Brave Care raises $5 million for pediatric urgent care clinics

Brave Care, the YC-backed urgent care clinic for kids, has today announced the close of a $5 million seed round of funding.

The company recently graduated out of the last batch of Y Combinator companies but sat out of demo day because the this round was already oversubscribed, according to cofounder Darius Monsef .

Investors that participated in the round include Sesame Street (via their partnership with VC Collaborative Fund), Greycroft, Refactor, and Fifty Years.

Portland-based Brave Care launched in July with the goal of creating a pediatric-focused urgent care clinic that could both serve companies and save them from spending thousands of dollars on visits to the emergency room.

In 2015, there were approximately 30 million pediatric emergency room visits in the United States — 96.7% of them were treat-and-release visits.

Brave Care wants to be there for parents and kids when the situation calls for something in between their regular doctor and the emergency room.

The facility was built specifically for children. The waiting rooms are kid-friendly, the instruments in the patient rooms are kid-sized, and the general philosophy behind Brave focuses on taking extra time to clarify the diagnosis and the treatment options clearly and patiently to parents.

The company also has plans to introduce a triage tool that walks parents through symptoms and helps them decide if they should head to an urgent care clinic or straight to the Emergency Room.

The funding will allow Brave to build out a new electronic health records system that would streamline check-in, communication with parents during and after a visit, and help physicians and nurses spend more time focused on the patient and less time typing out notes on their computers.

“We can’t build a tech-enabled health care business on someone else’s platform,” said Monsef.

Moreover, Brave will use the funding to open up new, more lightweight facilities in the Portland area that can act as spokes to the main hub facility, where the company has expensive but not oft-used equipment like an X-ray machine or a full-service lab.

Flat, a Mexican property tech startup, raises $4.6M pre-seed led by ALLVP

Flat has raised one of Mexico’s largest pre-seed rounds to take the Opendoor real estate marketplace model across the Rio Grande. 

The company snagged a $4.5 million pre-seed round to expand its business helping homeowners quickly sell their properties in Mexico. The round was led by ALLVP, an active early-stage fund in Mexico. California-based Liquid 2 Ventures (for which Hall of Fame quarterback Joe Montana is a GP), NextBillion and a few angels supported the round, as well. 

At the time of writing, Flat’s raise is the largest pre-seed funding round for a Mexican startup aside from the scooter company, Grin, which was backed by Y Combinator and later went on to raise a $45 million Series A and consolidate with Brazil’s bike-sharing startup, Yellow. 

While this ‘i-buying’ business model was initially pioneered by Opendoor in the U.S., the same need to efficiently sell property exists for consumers in other growing markets around the world. That’s why co-founders Victor Noguera and Bernardo Cordero founded Flat. 

Bucking a trend that has seen many new Latin American founders hailing from Stanford University, Cordero and Noguera met at the University of California, Berkeley — just across the bay.

The founders estimate the total value of the 40 million homes in Mexico to be a $1.6 trillion total addressable market. They equate the value of homes sold per year to $25 billion. Let’s not forget the elephant in the room — SoftBank is undoubtedly eyeing Mexico with its $5 billion LatAm commitment. 

Flat says it’s solving a few problems in the local home-buying market in Mexico. Firstly, anyone interested in selling their property lacks information about how much their home is actually worth. In the U.S., sellers can reference Zillow — but no such centralized database of real estate pricing information for the market of Mexico exists. 

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Then there’s the operational piece of transferring ownership of the property, which Flat says can take up to eight months and is a notarized process — making the overall experience incredibly illiquid. 

Flat’s actual product is a marketplace focused on helping the seller sell quickly. Flat visits your home, takes measurements, documents how many bathrooms and bedrooms exist in the property and determines how much your home is worth. From there, they manage renovations and transfer ownership of the property. The seller is paid within 72 hours. 

International expansion has been difficult for many startups operating in Latin America as every country has its own regulatory barriers. That’s why when it comes to growth, Flat says it’s more focused on growing out their product within other verticals of property management to only serve a Mexican market, rather than expand to other Spanish-language countries in the LatAm region.

Top EC articles in August, Apple privacy woes, autonomous delivery robotics Starship, and Zhihu

Top Articles in August

We are back from Labor Day (which an ironically somewhat unkind Canadian EC subscriber noted also takes place up north). August was the most successful month for Extra Crunch since our launch about six months ago — so thank you to the thousands of new and continuing members that help us sustain quality journalism and analysis.

For those who took extended vacations last month, here are the top five most popular articles among EC members we published last month:

Y Combinator Demo Day: We picked our favorites from day one and day two and our venture capital reporter Kate Clark wrote an analysis of what the 160+ startups in the batch seemed to indicate about YC’s investment theses these days. YC remains as popular as ever if EC members’ curiosity with these articles is any indication.

How a Swedish saxophonist built Kobalt, the world’s next music unicorn: Our Extra Crunch media columnist Eric Peckham traveled to Europe to report out this deep dive into Kobalt, which is upending traditional music rights management, and is closing in on unicorn status as well. This origin story here was one of my favorites, since it showed how tenacity against incredible adversity can lead to success in the long run. I am editing Eric’s next two parts of this EC-1 as I write this, so expect those shortly.

How Dropbox, Nike, Salesforce, MailChimp, Google and Pepsi welcome their new hires: This was a bit of a surprise one for me. Our guest writer Vladimir Polo has been collecting welcome kits from different companies for years, and he compiled all of them for this piece on how different companies think about welcoming employees.

WeWork’s S-1 misses these three key points: WeWork is the most polarizing startup I have seen in sometime. So I read through the S-1 (yes, all 200-300 pages of the damn thing) to find a couple of nuggets I thought the company was missing from the filing (which, in itself, was a follow up of my EC analysis of what we should expect to see in the S-1 in the first place).

How should B2B startups think about growth? Not like B2C: Finally, we had our guest writers Kevin Barry and Tyler Elliston discuss the differences between marketing and growing a B2B startup and how that compares with B2C startups. They give a detailed guide on the ways to think about growth in B2B and the tactical tools that these startups can use.

Apple still has work to do on privacy

Over the long weekend, our privacy and policy writer Natasha Lomas wrote an insightful analysis of what we know about Apple’s privacy promises given the news that the company was offering Siri recordings to contractors for grading. Lomas sees Apple’s privacy promises as quite cynical given the context, but also sees an opportunity for the company to right its past wrongs.

Urbvan raises $9 million for its private shuttle service in Mexico

As cities in emerging markets grapple with increasingly traffic-clogged and dangerous streets, Urbvan, a startup providing private, high-end transportation shuttles in Mexico, has raised $9 million in a new round of financing.

Co-founded by Joao Matos Albino and Renato Picard, Urbvan is taking the reins from startups like the now-defunct Chariot and tailoring the business for the needs of emerging-market ecosystems.

Hailing from Portugal, Albino arrived in Mexico City as a hire for the Rocket Internet startup Linio. Although Linio didn’t last, Albino stayed in Mexico, eventually landing a job working for the startup Mercadoni, which is where he met Picard.

The two men saw the initial success of Chariot as it launched from Y Combinator, but were also tracking companies like the Indian startup Shuttl.

“We wanted to make shared mobility more accessible and a little bit more efficient,” says Albino. “We studied the economics and we studied the market and we knew there was a huge urgency in the congested cities of  Latin America.”

Unlike the U.S. — and especially major cities like San Francisco and New York — where public transportation is viewed as relatively safe and efficient, the urban environment of Mexico City is seen as not safe by the white-collar workers that comprise Urbvan’s principal clientele.

The company started operating back in 2016. At the time it had five vans that it leased and retrofitted to include amenities like Wi-Fi and plenty of space for a limited number of passengers. The company has expanded significantly since those early days. It now claims more than 15,000 monthly users and a fleet of 180 vans.

Urbvan optimized for safety as well as comfort, according to Albino. The company has deals with WeWork, Walmart and other retailers in Mexico City, so that all the stops on a route are protected and safe. The company also vets its drivers and provides them with additional training because of the expanded capacity of the vans.

Each van is also equipped with a panic button and cameras inside and out for additional monitoring.

Customers either pay $3 per ticket or sign up for a monthly pass that ranges from $100 to $130.

Financing for the company came from Kaszek Ventures and Angel Ventures, with previous investor Mountain Nazca also participating.

For Albino, who went to India to observe Shuttl’s operations, the global market for these kinds of services is so large that there will be many winners in each geography.

“Each city is different and you need to adapt. The technology needs to be adaptable to the city’s concerns, and where it can, add more value,” says Albino. “The Indian market is super different from Latin America… It’s a huge market with a lot of congestion… But the value proposition is a bit more basic [for Shuttl].”

Urbvan is currently operating in Mexico City and Monterrey, but has plans to expand into Guadalajara later this year.

Ready, Set, Raise — the Y Combinator for female founders — announces second cohort

About one-fourth of the startups in Y Combinator’s summer batch had a female founder. Not the most disappointing statistic if you consider this: Companies with at least one female founder have raised only about 11% of venture capital funding in the U.S. in 2019, according to PitchBook. Companies with female founders exclusively have raised just 3%.

There is so much room for improvement.

To close the funding gap, programs tailored to female entrepreneurs are working tirelessly to mentor and incubate upstarts in hopes of impressing venture capitalists. Ready, Set, Raise, an accelerator program built for women, by women, is amongst the new efforts to help female and non-binary founders raise more dollars, or, at the very least, build relationships with investors.

The accelerator program, created by the Seattle-based network of startup founders and investors called the Female Founders Alliance, is today announcing its second batch of companies, a group that includes a sextech business, an AI-powered tool for podcasters and a line of workwear created for women who work on farms, construction sites and factory floors.

Ready, Set, Raise has partnered with Microsoft for Startups to provide entrepreneurs $120,000 in Azure credits, as well as technical and business mentoring from executives of the Redmond-based software giant. Other new partners include Brex and Carta, two well-funded companies that plan to lend the support of their executives to teach entrepreneurs about startup finance, valuation and fundraising terms. 

“Both FFA and Microsoft recognize a major lapse in opportunities given to women and non-binary founders,” writes Ian Bergman, a managing director of Microsoft for Startups, in a statement. “We look forward to our continued work together to promote this necessary shift in the VC landscape.”

FFA’s founder and chief executive officer Leslie Feinzaig, who launched the organization in 2017, has been an outspoken advocate of diversity in entrepreneurship and venture capital, and well as providing awareness and resources for founders who are also parents.

“My experience fundraising was undeniably shaped by the fact that I am a woman, and at the time was a new mom,” Feinzaig, who previously founded an edtech startup, told Seattle Business Magazine earlier this year. “A year later, I was about to give up. Instead, I started a Facebook group, including all of the founders and tech startup leaders I knew. It was the group that I needed, made up of people who knew exactly what I was going through. That’s how the Female Founders Alliance was born.”

FFA’s Ready, Set, Raise provides its companies childcare throughout the six-week program, in which companies work one-on-one with experienced coaches ahead of a demo day that will take place on October 16th. 

RSR Cohort 2 Twitter

Here’s a look at Ready, Set, Raise’s sophomore class of startups:

  • Echo Echo: AI-powered tools for podcasters.
  • Give InKind: Coordinates support through major life events.
  • Honistly: A provider of extended auto warranties to help with short-term cash needs.
  • Juicebox It: Modernizes erotica with a chatbot that is arousing and educational. 
  • Panty Drop: A personalized intimates shopping experience for women sizes XS-6XL.  
  • The Labz: A platform that protects and memorializes creative content development in real time.
  • Tougher: Functional, well-fitted workwear for women in the skilled trades. 

Lucid’s drone is built to clean the outside of your house or office

Building exteriors tend to get gross. Dirt clings to the walls. Windows get filmy. Spiderwebs amass. If you live in a particularly humid area, mold and mildew can start to make exterior walls look like a science experiment.

On taller buildings, scrubbing it all off generally means bringing a bucket truck, scaffolding, or suspension gear and having a crew hang from the side of the building. It’s a lot of prep work, with a lot of potential for falls and injuries. Lucid, a new company out of North Carolina, has a different approach: drones.

Rather than pressure washing, their drone “soft washes” the building — be it a house, an office, or the campus library — by spraying a cleaning solution that the company says is biodegradable and works on surfaces like brick and limestone. The operator rolls up to a site, unfolds the drone, powers it up, then plugs it into a tank sitting in the back of their work truck. A hose tether runs from the tank to the drone at all times, feeding the low-pressure sprayer while keeping the bulk of the weight down on the ground. The operator handles the drone via remote control.

The drone is currently battery-powered; in the future, Lucid plans to work tethered power into the design. The company tells me the drone is currently designed/tested to clean buildings up to 120 feet tall. That’s around 10-12 stories tall, depending on the building’s design.

While their early tests were done with off-the-shelf drones, Lucid tells me it’s now custom building its own; they need to be able to carry the weight of the tether, fly slowly for finer controls and easier operation, and stay light enough (under 55 lbs) that it fits within the FAA’s small unmanned aircraft guidelines. The company tells me that their drone weighs around 25-30lbs, depending on payload requirements.

Lucid co-founder Andrew Ashur says they originally set out to be the service provider, hiring operators and cleaning the buildings themselves. When they began testing the concept and other companies started reaching out, the team realized that they might be better off selling the drone itself. They’re now starting to rent the drones out to companies for $3,000 per month, which includes support, training, and maintenance (because, as any hobbyist drone pilot could tell you, things break.)

Lucid is part of Y Combinator’s Summer 2019 batch. As of YC Demo Day last week, the company noted that it had signed contracts worth around $33,000 per month in recurring revenue.

Ashur tells me that while they’re considering a nationwide rollout, their focus right now is on the Southeastern United States — it’s where they started, and where mold and mildew issues are common.

Y Combinator graduate PredictLeads helps VCs hunt for unicorns

The Slovenian founders behind PredictLeads, another recent Y Combinator graduate, applied to the prestigious accelerator five times before they were admitted.

Their business, which helps venture capital firms and sales teams identify high growth companies, i.e. potential investments and potential customers, had come a long way since it was founded in 2016. And earlier this year — finally — YC gave them the green light to complete its three-month accelerator program.

“We almost ran out of money in 2017 and then I took a loan from my mother because that bank wouldn’t give me the loan at that point,” PredictLeads chief executive officer Roq Xever tells TechCrunch. “But by then, the data was getting much better and we were able to make higher-value sells and that got us to profitability.”

You read that right. Unlike most of today’s tech startups, PredictLeads is profitable, though, only out of pure necessity: “We didn’t know we would ever get into YC to raise the money we needed, so we structured the company to make more money than we spent.”

Xever leads the small PredictLeads team alongside marketing chief Miha Stanovnik and chief technology officer Matic Perovsek. Xever tells TechCrunch it wasn’t until they realized the opportunity to sell their product to VCs that YC became interested. Today, PredictLeads has eight venture firms as customers, the names of which they were not able to disclose.

The tool helps investors track companies they’ve considered in the past. PredictLeads notifies users if certain companies start getting traction so they can reevaluate the deal and helps investors become aware of startups they may not have otherwise heard of.

More and more venture capital firms are turning to third-party tools to help them make sense of and leverage data in the investment and company-tracking process, leading to the birth of new data-focused companies. Social Capital co-founder Chamath Palihapitiya is spinning out a company from his venture capital fund-turned-family-office, TechCrunch learned earlier this year. The new entity, temporarily dubbed CaaS (short for capital-as-a-service) Technologies, will focus on providing data-driven insights to VC firms, for example.

Startups have also realized the importance of data. Narrator, another recent YC graduate, is betting big on this trend. The startup wants to become the operating system for data science by providing companies software that claims to fulfill the same service as a data team for the price of an analyst.

PredictLeads, for its part, collects data from websites, press releases, news articles, blogs and career sites, then uses supervised machine learning to extract and structure the data. The startup tracks 20 million public and private companies.

Now that it’s a graduate of YC, the team is in the process of moving its headquarters to the U.S. Either New York or San Francisco, says Xever, who’s currently navigating the difficult visa application process.

The startup is today raising a $1.5 million seed financing at a $10 million valuation. They plan to use the capital to expand their service to cater to quant funds, build a Salesforce app to better support sales teams, and, of course, expand their small team.

Satellite internet startup Astranis books first commercial launch on SpaceX Falcon 9

Y Combinator-backed startup Astranis is now set to launch its first commercial telecommunication satellite aboard a Falcon 9 rocket, with a launch timeframe currently set for sometime starting in the fourth quarter of next year. Astranis aims to address the market of people who don’t currently have broadband internet access, which is still a huge number globally, and they hope to do so using low-cost satellites that massively undercut the price of existing global telecommunications hardware, which can be built and launched much faster than existing spacecraft, too.

Astranis satellites are much more cost efficient because they’re smaller and easier to make, which changes the economics of deployment for potential carrier and connectivity provider partners. Its approach has already attracted the partnership of Microcom subsidiary Pacific Dataport, an Anchorage company that was formed to expand satellite broadband access in Alaska. This will be the goal of the company’s first launch with SpaceX, to deliver a single satellite to geostationary orbit that will add more than 7.5 Gbps of capacity to the internet provider’s network in Alaska, tripling capacity and potentially reducing costs by “up to three times,” according to Astranis.

This isn’t the first ever satellite that Astranis has sent up to space – it launched a demonstration satellite in 2018 to show that its tech could work as advertised. Astranis’ approach is distinct from others attempting to offer satellite-based connectivity, including SpaceX’s own Starlink project, because it focuses on building satellites that remain in a fixed orbital position relative to the area on the ground where they’re providing service, as opposed to using a large constellation of low-Earth orbit satellites that offer coverage because one or more are bound to be over the coverage area at any given time as they orbit the Earth, handing off connections from one to the next.