Enterprise & Deep Tech Weekly

Issue #83: For the week ended June 9, 2020

It’s been a crazy busy week, so we’ll get straight to the news, and there is a lot of it. Two massive acquisitions out of Israel, a few lighthouse financing rounds in the US in JAMstack and RPA, and Google Plus is back from the dead with an enterprise angle…

One more quick thing: our series of interactive talks with enterprise tech leaders is ramping up. You can find our last two events, which each had about 100 participants asking questions from around the world, up on Youtube here. We’ve got five absolutely awesome speakers coming up over the next two weeks alone (check them out below) and several more lined up after them. We are adding guest speakers all the time — so let us know if you have any requests. The best part of the program, however, is the questions from the audience. We set out to create a global conversation on enterprise tech — and that is starting to happen. So come join us!

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.

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

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

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

• June 22: Adapting to a Remote-First Sales Strategy with Roy Raanani, the Co-Founder and President of Chorus.ai

• 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

• Israel/Cloud. NetApp acquired SpotInst for $500M. The company is an interesting forerunner of the “infrastructure-as-code” movement we are seeing today. “Today Spot.io offers cloud computing optimization services to software-as-a-service (SaaS) companies. Using machine learning algorithms, it monitors the availability and pricing of computation power offered by cloud services to optimize use by clients. The major cloud companies often use the services of the Israeli company to optimize the use of their services and retain customers. The company evaluates server costs for its customers, offering them the best prices they can find in real-time. The platform also allows companies that operate on parallel cloud services such as Google, Amazon and Microsoft, to unite them under a single user interface. A key part of the company’s software is a control system that constantly checks the services that its customers receive and warns them if the cloud service they are storing on is altering prices or considering removing them.”

• Israel/Supply Chain Analytics. National Instruments bought Optimal Plus for $365M. Founded in 2005 and based in the central Israeli town of Holon, OptimalPlus develops AI tools for the automotive, semiconductor, and electronics industries that provide real-time product analytics and extract insights from data across the entire supply chain…”OptimalPlus was one of the pioneers that implemented AI, machine learning, and big data analytics in its algorithms over a decade ago,” Aaron Mankovski, managing general partner at Pitango said in a statement. “These capabilities made the company a category leader in the semiconductors and electronics industries,” he said. “With this competitive advantage, OptimalPlus appeared on NI’s radar and the two have developed a close relationship over time, that allowed both companies to realize the long term value of a merged entity.“

• Germany/Radar. Cruise bought Astyx, a German radar manufacturer founded in 1997. Notably, the Astyx technology is able to detect stationary objects in the middle of the road and distinguish them from other static objects, said one of the former customers. That has been a challenge for robotaxi prototypes as well as driver assistance systems used on highways, including Tesla Autopilot, which occasionally crash into vehicles stopped in freeway lanes, or into other objects. This is Cruise’s second attempt to acquire its own producer of sensors. Cruise previously bought a lidar developer based in Southern California. That business has faced delays in developing the device, and Cruise still largely relies on external suppliers of lidar, such as Velodyne and China-based Hesai, said people with knowledge of the matter.

• Iceland/HPC Data Farms. Verne Global raised $27M for its sustainable data center solutions for high-performance computing (HPC).

• Ireland/AI Supply Chain Automation. Keelvar raised $18 million for its AI-driven d AI-enabled ‘sourcing bots’ to automate tactical buying processes, specifically sourcing and procurement.

• UK/Work Observability. Cutover raised $17M for its software that empowers teams within organizations to plan, set up and audit complex workflows, thus improving collaboration and efficiency.

• Germany/Enterprise RPA. Bryter raised $16M for its no-code platform that allows professionals from a variety of sectors — law, finance, tax, compliance — to digitally transform their business practices without any programming.

• Israel/Data Risk Discovery. 1touch raised $14M for its software that helps companies reduce their privacy and security risks by providing automated real-time discovery, mapping, and tracking of personal data flow.

• Denmark/Run Your Office. Good Monday raised $3.7M for its workspace management platform that lets companies organize everything from cleaning, coffee, and lunch to employee benefits such as gifts, flowers, birthday cakes, and yoga.

Worth reading

Enterprise/Tech News

• DataOps is big. A recent survey by 451 Research found 100% support for the idea that DataOps is a critical area for enterprise IT investment.

• Zoom revenue is up 169%. According to the WSJ, For San Jose, Calif.-based Zoom, the new virus has been both a boon and burden. The pandemic has raised the company’s profile, but also has exposed security and safety shortcomings that nine-year-old Zoom now is rushing to address. The boost in popularity has put Zoom in the battle for how businesses work remotely, pitting the company against far-larger rivals such as Microsoft Corp.

• GraphQL gets remote joins. Hasura has released a new “remote join” capability to extend the capabilities of GraphQL, the next-gen API framework originally released by Facebook. “GraphQL has emerged as the basis for a more streamlined alternative to REST APIs. GraphQL provides a complete description of the data made available via an API and is organized in terms of types and fields rather than traditional endpoints. In addition to making it more clear what data is available via that API, developers can employ types to avoid writing manual parsing code. Hasura is now taking that concept a step further by enabling IT organizations to join data residing in different databases and microservices to enable that data to be queried as if it were a single data source. The core Hasura engine automatically generates the GraphQL engine, which enables those remote joins to be created in a few minutes.”

• A new player in RPA. Bessemer led a $60M round in Hyperscience, a NYC-based RPA company founded by an ex-Soundcloud employee. What Hyperscience does that RPA companies do not, its CEO claims, is rewrite and improve the business processes themselves. RPA software essentially adds a layer of code that stitches together different systems to make them automatable, says Brodsky; Hyperscience’s approach, which it calls software-defined management, can detect the best process that would lead to a certain outcome, even if no human has yet put it in place. “RPA faces an existential threat from the fact that they have hitched their wagon to a legacy star,” Brodsky claims. “With or without us, legacy systems will inevitably die out; that’s what legacy systems do. We want to help businesses define their business processes the same way that they write software.”

• Gatsby grows. Index Ventures led a $28M round in the static site generation company, which is emerging as one of the key drivers of the JAMstack revolution. Gatsby’s website- and app-building platform offers a cross-section of products that span those offered by Squarespace or Wix — which require no knowledge of coding or development — to more complex developer-focused platforms offered by Wordpress, Google, Amazon and Microsoft. “We think of ourselves as the [content management system] for the cloud era,” says CEO and co-founder Kyle Mathews.

• Google Plus ride again! Google is relaunched its shuttered social network (Google Plus) as an enterprise offering for G Suite users called “Currents.”

• Post-lockdown blues. Wired reports on a tale of two offices: one in social distancing dystopia, and the other isolated and stuck online.

• Dragged into politics. Pressure grows on advertisers to pull away from Facebook.

How to Startup

• How to compensate a sales rep. Jason Lemkin wrote this back in February, but I saw it this week and it’s great. Jason blows up some conventional wisdom around sales comp. For example, he comes out against guaranteed draws, but in favor of monthly bonus payouts. “Do pay well when they kill it — against a sane plan. And don’t cap the upside. That’s the trade-off. No draw, no huge salary for just showing up. But you have to pay very well when a realistic plan is hit (not a ridiculous one), and you have to pay very, very well when you exceed it. This will appeal to a great VP Sales on the way up. It won’t appeal to a mediocre one or one on the way down.”

• When to fire sales reps. In addition to the comp piece above, Jason also published this piece on how much time to give a new sales hire before pulling the plug. The best reps “get on the board” fairly quickly. They may not immediately hit quota (few do). But they find a way to close something relatively early. At least, 1 or 2 deals. If you don’t see that in 0.5–1 sales cycles, it rarely works out. They lose their confidence. They haven’t been trained properly. They don’t have the right types of leads and prospects.

• Pricing and Packaging software today. Donnie Berkholz gave a talk at Heavybit recently on how software companies can adjust pricing and packaging for the Coronavirus recession. “COVID brought essential priorities into focus. While enterprise teams might have previously had a wide range of projects simultaneously, many have whittled down that list to business-essential initiatives only. To stay relevant to their shifting needs, the way you position your product is essential.” Watch the full video here.

• Category design. Pietro Bezza of Connect Ventures updates his category design framework, now on Notion with some helpful templates designed to facilitate a two-day self-guided workshop. Category definition (or design, to use Pietro’s term) is supremely important — and this is a very strong attempt to help founders through a super challenging mental process.

How to Venture

• Awesome map of the “Future of Work.” A lot of market maps are crap, and “future of work” is one of the most over used “themes” in VC land. But this map and sector analysis by Pietro Invernizzi, who just joined Stride from the Family, is absolutely killer. It’s useful, thoughtful, and compelling.

• Can European tech stand alone? Nicolas Collin argues that it might make sense for some European startups to abandon their global ambitions and double down on Europe as nationalistic and continental walls go up. I agree with Nicolas that this may make sense for an increasingly large number of companies — but that is more a function of the larger share that tech is taking of all markets not of higher barriers to global domination. Angular’s view is that there has never been a better time to try to build a world-beating company from a non-US location — and that the path to doing so typically goes through the US in some form.

• To scout or not to scout? Roxanne Varza argues that more VCs in Europe should build scouting networks. My view is that scouting networks — while perenially attractive to VC funds and the scouts themselves — are ultimately very difficult to manage over the long term. They tend to be “top-of-market” phenomena, driven by FOMO and a rush to deploy into chaotic markets.

Portfolio News

Datos Health is helping New York reduce the spread of COVID-19 through the implementation of its dedicated and scalable remote care platform.

DUST Identity’s CEO’s article on building supply chain resiliency in a post-pandemic world was featured in Supply & Demand Chain Executive.

Planable released their latest People of Marketing podcast with Perrin Lawrence, (NYT, NBA, and AI.reverie) covering startup life, patience, and why the outside-of-work matters.