Enterprise & Deep Tech Weekly

Issue #82: For the week ended June 2, 2020

Heartbroken. Like all Americans, I’m heartbroken by the news from the US over the past week. I lack the wisdom to put these moments into their full context, but my faith in the ultimate success of the American experiment remains unabated. I have found that in moments like this, listening to the speeches — the voice and words — of Martin Luther King helps restore that faith when it is shaken. Here, for example, is his final speech from April 3, 1968. “But somewhere I read of the freedom of assembly. Somewhere I read of the freedom of speech. Somewhere I read of the freedom of press. Somewhere I read that the greatness of America is the right to protest for right. And so just as I say, we aren’t going to let dogs or water hoses turn us around, we aren’t going to let any injunction turn us around. We are going on….We’ve got to give ourselves to this struggle until the end. Nothing would be more tragic than to stop at this point in Memphis. We’ve got to see it through. And when we have our march, you need to be there. If it means leaving work, if it means leaving school — be there. Be concerned about your brother. You may not be on strike. But either we go up together, or we go down together.” Amen.

Idea generation. Back in the world of tech, this week’s must-read is by Sam Altman, the legendary founder of YC. He reflected recently on how idea generation actually works for founders. “Any time you can think of something that is possible this year and wasn’t possible last year, you should pay attention. You may have the seed of a great startup idea. This is especially true if next year will be too late. When you can say “I am sure this is going to happen, I’m just not sure if we’ll be the ones to do it”, that’s a good sign. Uber was like this for me — after the first time I used it, it was clear we weren’t going to be calling cabs for that much longer, but I wasn’t sure that Uber was going to win the space.”

Next Wednesday we are hosting an interactive talk for founders with Vivek Saraswat, an investor at Mayfield and previous a product leader at Docker, VMware, and AWS. Register here to join us and get your questions ready. Check out our upcoming events and recordings of past events.

As always, if you are building an enterprise or deep tech startup in Europe or Israel, please let me know… Now let’s get to the news.

Angular Insights: Talks for Enterprise Founders

Angular is hosting a series of online interactive talks with our community of early-stage enterprise tech founders from across Europe and Israel. These 30-minute talks are designed to deliver practical startup advice in an easy-to-consumer format — with plenty of opportunities to engage with our speakers. Typically, these take place on Wednesday at 3pm UK, 4pm CET, 5pm Israel. To register for any of the talks, just click on the links below.

• Weds, June 10: Enterprise Product Strategy with Vivek Saraswat, investor at Mayfield Partners and former product leader at Docker, VMware, and AWS

• Tues, June 16: Breaking Into Your First Enterprise IT Account with Ed Sim, Founder and Managing Partner at Boldstart Ventures

• Weds, June 17: Monetizing an Open Source Project with Fred Simon, Co-Founder and Chief Architect of JFrog (and Angular Advisory Partner)

• Weds, June 24: Mistakes Slowing Your Growth with Guy Poreh, former Head of Digital BBDO, Chief Innovation Officer at Silver + Partners, and Founder of Playground (and Angular Advisory Partner)

Check out: www.angularventures.com/events for additional upcoming events, recordings of past events, and to subscribe to our event series.

From the blog

Coronavirus Impact Survey: We surveyed over 120 founders on their response to Coronavirus.
Surviving Coronavirus. A guide for founders and some resources on remote work. Also, some straight talk on VC fundraising in 2020.
Defining Enterprise/Deep Tech. What do we actually mean by the phrase “enterprise or deep tech?”
Introducing the Angular Ventures Team. Getting to know Anne and Andrew.
Launching Angular Ventures I. What we do, why we exist, and how we got here.
US incorporation? Just do it. Why nearly all enterprise tech companies should incorporate in Delaware.
Technology for Trust. Why we invested in Vault Platform
A Security Layer for the Physical World: Why we invested in DUST Identity
A System of Intelligence for Field Service: Why we invested in Aquant.io

Europe/Israel Enterprise/Tech

• Switzerland/Barcode Scanning & Workflow. Scandit raised $80M for its system that allows enterprise companies to manage inventory, e-commerce and logistics within one intelligent scanning and tracking system.

• France/Call Centers. Aircall raised $65M for call center SaaS.

• Portugal/ML. DefinedCrowd raised $50M to help provide training data for ML models.

• Germany/Medical Staffing. Medwing raised $30 million for its digital tools that help hospitals and other medical care facilities with recruitment and HR processes.

• Israel/Corporate Payments. Treasury Intelligence Solutions raised $20M for its cloud platform for managing corporate payments and cashflows.

• Israel/Legal. LawGeeX raised $20M for its NLP solution for faster legal document processing.

• Israel/Privacy. D-ID raised $13.5M for privacy-compliant imaging technology. D-ID’s AI technology produces photos and videos which are unrecognizable to facial recognition algorithms while keeping them visible to the human eye. D-ID enables companies, security agencies, and governments to comply with privacy regulations and protect biometric databases.

• Israel/AI Weed Killer. Greeneye raised $7M for its artificial intelligence platform to detect and spray weeds in real-time.

• Italy/Commerce API for Global Brands. Commerce Layer raised $6M from Benchmark for its “headless” e-commerce platform — used to develop online sales strategies that use APIs to plug your inventory to take orders and payments from a variety of endpoints.

Worth reading

Enterprise/Tech News

• AI vs. Information Overload. MIT Tech Review interviews Stewart Butterfield of Slack on how AI might improve the lives of knowledge workers.

• A deep dive on CFO tooling. Anne Khan of CRV takes us with her on an awesome deep dive of emerging CFO tooling. “In the last year, a new and interesting trend has emerged. Companies that started off in bookkeeping automation are offering solutions for billing — others that started in spend management are offering payroll solutions. With strong infrastructure options and better bank integrations, new cloud entrants can build and offer multiple solutions easier than they could have a decade ago. This has led to an incredible proliferation of tools for the finance role that I’ve outlined below. All of this being said, replacing finance tools is tough. It may be easy to switch tools in other functions — but you can’t get it wrong with billing, or payroll, or bookkeeping! This leads to often slower sales cycles, and frankly, companies sticking to less friendly solutions (because hey! if its working, why break it?)”

• Cloud Storage is Hot. Wasabai raised $30M for a cloud-based storage alternative to Amazon S3. “Wasabi refers to its approach as ‘hot’ cloud storage, meaning that it eliminates storage tiers, treating all data the same and allowing fast access thanks to being made readily accessible. Some of its 15,000 customers include Legendary Entertainment, Netgear and Penn State University.”

• SQL ain’t going away. Andrew Oliver argues that rumors of SQL’s death have been exaggerated. “Indeed, SQL proved resilient even when JSON and sharding gained such rapid popularity that new database vendors were quick to abandon SQL largely because of their immaturity and lack of things like joins. It soon became apparent though that SQL was not to be brushed off quite so lightly, as customers began encountering weird silos and the need to engage in a lot of heavy lifting in order to ensure integration with other tools. Many organizations lost the capabilities that they’d had before the move. While this was happening, SQL was evolving. NewSQL databases that fully embraced SQL emerged, JSON datatypes were added, and new ways of scaling SQL took hold.”

• Changing IT priorities. CIO Dive found that digital transformation efforts that were once part of long-term projects were pushed through in a matter of weeks at 71% of organizations.

• Hong Kong Tech. China’s recent moves to dramatically strengthen its grip on Hong Kong are likely to have implications for technology around the world, according to the Information. “Beijing is in the middle of pushing through cybersecurity legislation on the mainland that would force certain companies to meet new security requirements and undergo invasive audits. These efforts could extend to Hong Kong depending on how China drafts the new national security laws.”

• Space Debris. The MIT Tech Review looks at the challenge of space debris and what can done about it. Now for the good news: different groups are working on a myriad of technology concepts that may show some promise, especially as we start to launch more satellite constellations over the next decade. A company called Astroscale wants to fish for defunct satellites and drag them out of harm’s way. Swiss scientists are pursuing a similar technology and have plans to launch a demo in the near future. More extreme (and highly unrealistic) methods involve using ablating lasers to shoot debris out of orbit or slow it down so it falls back into the atmosphere and burns up.

How to Startup

• Don’t be delusional says Gili Raanan, formerly of Sequoia and now leading Cyberstarts together with Lior Simon. “I believe the health crisis, and as a direct result, the economic crisis will be very acute,” Raanan said. “Predictions that retail consumption will remain 30% lower than they were before the outbreak will trickle down everywhere, companies will sell less and the entire ecosystem will suffer. The travel and hospitality industries have experienced a major blow and can’t see any relief on the horizon. Cyber companies will also sell less, both directly and indirectly.”

• Don’t write off California just yet. Tomasz Tunguz finds that 63% of US unicorns are based in California, accounting for 79% of market cap. “If recent history has taught us anything, it’s that valuations can change on a dime. Barring some sudden shift, these data suggest California’s share of significant exit events should at least sustain current levels; and an optimist could argue, further concentrate in California.”

• Idea generation. Sam Altman, the legendary founder of YC, reflects on how idea generation actually works for founders. It’s a must-read. “Any time you can think of something that is possible this year and wasn’t possible last year, you should pay attention. You may have the seed of a great startup idea. This is especially true if next year will be too late. When you can say “I am sure this is going to happen, I’m just not sure if we’ll be the ones to do it”, that’s a good sign. Uber was like this for me — after the first time I used it, it was clear we weren’t going to be calling cabs for that much longer, but I wasn’t sure that Uber was going to win the space.”

• Avoid stealth mode. A strong argument as to why most founders should just skip “stealth mode” in most cases.

• Product-led Growth. Kieran Flanagan, Hubspot’s VP of Marketing and Growth, suggests that success in PLG may require a different organizational structure and the ability to think about “in-product” conversion metrics. “Many B2B companies use the traditional top-down org structure, which means work is siloed. This structure might work well for some, but product-led companies are tossing it out the window and organizing themselves into cross-functional pods and squads.”

• Fundraising tips for Coronavirus times from Christoph Janz, the Jedi master of SaaS, in a very useful twitter thread. My favorites include “disqualify ruthlessly” and the reminder to make sure your materials are in great shape given the increasingly “asynchronous” nature of fundraising in this environment.

How to Venture

• VC in a Pandemic. According to data gathered and analyzed by Crunchbase, early-stage funding is down but late stage funding is holding strong. Seed funding is down 32 percent and early-stage funding down 26 percent for the four-month period. Given that seed has the largest data lag, however, we fully expect it to recover. For early-stage funding, we see a bigger pullback as the larger Series A and B rounds are announced in news cycles. Late-stage venture rounds, plus technology growth, is stable year over year for this four-month timeframe at $54 billion with a greater share of overall dollars coming in at 66 percent versus 59 percent in 2019. Late-stage peaked in 2018 due to funding expansion in China, followed by a contraction in 2019.

• A look at Loom. Christoph Janz of Point Nine writes transparently about the firm’s decision to invest in Loom. “It almost looked too good to be true. It took us more time to convince Joe, Vinay, and Shahed that they should take money from us than it took us to convince ourselves that we wanted to do this investment.”

Portfolio News

DUST Identity was named a Gartner Cool Vendor in Supply Chain.

Crux OCM launched a new video featuring their CEO, Vicki Knott, on why they believe in the Future of Autonomous Control Room Operations.

Datos Health’s CEO, Uri Bettesh, shared in a recent Microsoft Build session how their remote patient care platform is helping prevent hospitals from becoming overloaded.

Aquant shared how to attract and retain Gen Z and Millennial employees in the service industry.

Planable was selected as one of the 25 best Facebook marketing tools to level up a campaign.