Enterprise & Deep Tech Weekly

Issue #86: For the week ended July 6, 2020

Going public. The big tech news in Israel last week was Lemonade’s IPO on the NYSE. The direct-to-consumer online insurance broker raised $319M at a $1.6B valuation, and subsequently popped to a $3.8B market cap, renewing questions about whether or not the traditional i-bank process is the optimal IPO mechanism. More importantly, the successful IPO may indicate that the public markets might remain open for solid tech companies raising capital at reasonable prices even in the midst of the current uncertainty. Congrats to my friends at Aleph and Lemonade (Go Erez!) on the amazing outcome!

Some cap tables make me angry. Last week, I tweeted on the injustice of some cap tables I’ve been seeing lately. It’s purely anecdotal, I wrote, but over the past few months, nearly every time I have seen a cap table that reflects truly abusive pre-seed terms by unscrupulous/unprofessional pre-seed funders — the founder involved has been female. First off — any founder (especially female or under-represented) who wants perspective on terms they have been offered is more than welcome to reach out to me. We’ll have the same open and honest conversation on terms that we have with every founder and that are enshrined in our principles of conduct, which we’ve been public about since 2014. But more generally, alignment over the long-term is super important. VCs and angels who do not create long-term alignment are doing a disservice to both founders and to themselves (and their LPs). VCs need to look themselves in the mirror and ask some tough questions: Would you be driving those insane terms if the founder was different? Do you really think this business is a zero-sum game? So you managed to underfund and over-dilute a first-time founder. Good for you. Now we are going to be picking up the pieces in a suboptimal situation for years. I don’t know what’s causing it or why (subconscious bias? power dynamic?) But nearly every time a cap table has made me angry recently, it’s a female founder who has been forced into a corner — and it’s not cool. What took me by surprise was the number of female founders who messaged me in response to say that they hadn’t even bothered to meet with VCs out of fear that this sort of aggressive behavior would take place. It’s not just women and under-represented founders who are falling victim to this behavior, but there the problem is even more acute — at least in my limited sample. As an industry, we clearly have a very long way to go. VCs should be calling out crazy terms whenever they see them — and founders should be getting second opinions before signing their companies away.

Angular Insights on Retail and AI. Our series of interactive talks continues to drive high engagement and, we hope, tangible value for the founders who join us. Last week, we hosted Francesca Danzi on the digitization of retail (Tori Burch, Burberry, Chanel) and this week we are hosting Micha Breakstone on building an AI-driven startup. As a co-founder of Chorus.ai, Ginger (acquired by Intel), and Summly (acq by Yahoo!), Micha’s got a ton of experience on the topic — and will be answering your questions live. Register to join us by clicking here.

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 45-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.

• July 8: Building an AI-Driven Startup with Micha Breakstone, Co-Founder of Chorus.ai

• July 22: Pitching Media Right Now with Beck Bamberger, CEO of BAM Communications

• July 29: New Platforms & Architectures — How IT is Changing with Bucky Moore, Partner at Kleiner Perkins

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

From the blog

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

• Germany/B2B Banking Infra. SolarisBank raised $67.5M for its platform that enables businesses to build and offer financial services and products.

• Israel/CI-CD. CodeFresh raised $27 million for its tools for the development, testing, and deployment of apps on the Kubernetes open-source container orchestration system.

• Israel/Digital Asset Security. Curv raised $23M for its security infrastructure layer for digital assets.

• UK/Carbon Capture. Carbon Clean Solutions raised $22M for its low-cost CO2 capture and separation technology.

• France/Data Sharing. Okwin raised $18M for a platform to enable security and privacy-compliance data sharing for medical ML/DL model building.

• Estonia/Instant Identity Verification. Veriff raised $15.5M to help protect businesses and their customers from online identity fraud by making sure that a person is who they claim to be.

• Israel/Secutiry. Hunters raised $15M to that helps enterprises defend themselves from intruders and analyze attacks.

• Israel/OS for Data Lakes. Upsolver raised $13M for its cloud-native platform that abstracts the engineering complexity of data lake ingestion, storage and ETL.

• Germany/APIs & Databases. Prisma raised $12M for its open-source database toolkit for developers. It replaces traditional ORMs and makes database access easy with an auto-generated query builder for TypeScript & Node.js.

• UK/Governance. OneTrust is engaged in an acrimonious battle with some former employees in the UK who claim unfair dismissal.

• Europe/Foodtech. A solid look at Europe’s foodtech landscape, by Anna Ottoson of Trellis Road.

Worth reading

Enterprise/Tech News

• Fivetran raises $100M on a $1.2B valuation. TechCrunch covered it here. The company is significant because it represents a bet that data pipeline — specifically “out of the box, ready for analytics” pipelining is the key value proposition that will unlock a whole generation of data analytics. That sounds right to me.

• Salesforce invests in Security. The software giant apparently plowed $100M into Tanium at a $9B valuation as it aggressively expands its offering into security. “The investment, announced on Thursday, is part of a strategic tie-up between the two companies that will bring Tanium’s security tools into Salesforce’s massive customer base. Tanium’s technology gives IT teams visibility into all those devices that employees are now using from home, an issue that’s becoming more important by the day as the coronavirus pandemic drags on and companies keep their staffers out of the office.”

• OneTrust buys Integris. The data governance giant bought Integris, a Seattle startup. “Integris Software’s AI technology will be used to enhance OneTrust’s DataDiscovery product, according to a news release. The product helps companies understand their data and automate privacy, security and data governance programs. Integris’ tech has already been integrated into the product.”

• VMware buy Datrium. “Datrium, already a VMware partner, offers disaster recovery as a service for VMware Cloud on Amazon Web Services. It enables incremental backups that are encrypted, deduplicated and stored on Amazon S3 storage.”

• The big trucks are here. “San Diego-based self-driving startup TuSimple announced what it’s calling the world’s first autonomous freight network.”

How to Startup

• Experimenting with pricing. Julien Lehr of Stripe wrote a guest post for Point Nine on pricing. It’s awesome. Here is one of his nine points: “Charging on a per-user basis not only optimizes for willingness to pay, it’s also a price metric that correlates and scales nicely with the value you provide. Slack becomes more valuable the more people join an organization, so it makes sense to base the price on the number of users. As the organization grows (which, again, is a good indicator for company success and thus willingness to pay), so does Slack’s business. It’s worth mentioning here that Slack only charges for users who are actively using the product: The pricing is perfectly aligned with the value it provides. The thing to keep in mind is that your pricing needs to be predictable and simple. Slack could also base its pricing on the number of messages sent — another good proxy for the value it provides — but that would make it really difficult for new customers to predict how much the service will cost them.”
  Stripe, for example, doesn’t charge any setup fees or monthly subscriptions. The pricing is based on the value of each successful transaction it facilitates, which means it only wins if its customers win.

• Forecasting. Some thoughts on how to improve sales forecasts (and create a forecasting culture) by Ystine Ompad at Closer.

• What is customer success? Sujan Patel outlines the basics on how to think about this function and implement it in practice. “Customer success, on the other hand, is proactive. Its whole intent is to empower customers to get the greatest possible use out of your product — which means equipping them with the training and information needed to set them up correctly from the start.”

How to Venture

• Pushing back on Trump’s H-1B policies. Lightspeed partner Arif Janmohamed comes out swinging on the flawed logic behind Trumps H-1B crack down (video).

Portfolio News

Datos Health’s remote care platform can increase patient adherence to cardiac rehabilitation and result in functional improvement, new study shows.

Vault Platform’s Lauren Abramsky shares why she joined Vault and what she’s working on at the startup disrupting workplace misconduct reporting.

Aquant is hosting a webinar on its service intelligence platform on July 9th. Register to learn more about how to optimize service performance with AI.

Snyk is one of the five latest UK-based unicorns.

JFrog launched ChartCenter, a free security-focused immutable chart repository for Helm.