Europe/Israel Enterprise/Tech Weekly

The Angle Issue #43: November 20, 2018

Hello from Tel Aviv where it's been beautiful, sunny, and full of startups. I've been back-to-back in startup meetings, so we'll get straight to the news this week.
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If you are building an enterprise tech startup in Europe or Israel, please let me know... 

From the blog

Accelerators or Conform-erators?

Angular's first investment: Why we invested in Aquant.io

1Q18 & 2Q18 EU+IL VC Data.
$12.7B of VC investment summarized in 70 slides. 

Europe/Israel Enterprise/Tech

• Israel/AI Chips. Habana Labs raised $75M for AI chips. 

• Israel/3D Printing. Velox raised $32M for "direct-to-shape printing" technology. 

• Israel/Security. XM Cyber, a cybersecurity startup co-founded by former Mossad chief Tamir Pardo, raised $22M.

• Spain/Identity. 4iQ raised $18M for its identity security software.

• Israel/Data Protection. Cognigo raised $8.5M for data protection and GDPR compliance. 

• UK/Fintech. Fluidly raised $6.4M for "intelligent" cash flow management SaaS.

• Czech/Infrastructure. Citrix acquired Sapho for $200M. Sapho is an American company that helps bridge legacy apps to the cloud/mobile era. The company has a development office in Prague.

• UK/Health. Google announced that it is "absorbing" Deepmind Health, which was previously part of Deepmind, the London-based AI company Google acquired for $500M in 2014. There has been a lot of tension in the UK relating to Deepmind Health after the revelation that the outfit had illegally entered into a data sharing partnership with the NHS, the UK's National Health Service. "The news clearly signals Google’s ambitions in health care and its desire to get the most of its acquisition of the London AI lab. There have reportedly been long-standing tensions between DeepMind and Google, with the latter wanting to commercialize the former’s work. Compared to Google, DeepMind has positioned itself as a cerebral home for long-sighted research, attracting some of the world’s best AI talent in the process."

• UK/Payments. A profile of Christian Owens, founder of Paddle. 

• Israel/Humor. If you do not speak Hebrew, don't click on this. If you do speak Hebrew, this is the funniest startup-related thing you'll see this year:

Worth reading

Enterprise/Tech News

• The end of the beginning. A16Z's Benedict Evans with a brilliant 24-minute presentation on technology as it moves out of the "beginning" phase. 

• Blackberry buys Cylance for $1.4B. Fortune has more: "Cylance is a cybersecurity company that relies on artificial intelligence and machine learning to develop security services. The company’s focus is on prevention and using artificial intelligence to find problems before they can wreak havoc on a network. BlackBerry, meanwhile, has been reinventing itself. The company has offloaded its smartphone business and now focuses on a variety of productivity and security software services for companies. In a statement, BlackBerry CEO John Chen said that Cylance will fit well with his company’s other security services. He added that Cylance’s technology could be especially useful in improving security in a variety of connected devices, like autonomous cars, that use the company’s QNX service."

• Get ready for the feds. Apple's Tim Cook told Axios that he thinks that government regulation of how tech companies handle personal data is "inevitable:" ""Generally speaking, I am not a big fan of regulation," Cook said in the interview. "I'm a big believer in the free market. But we have to admit when the free market is not working. And it hasn't worked here. I think it's inevitable that there will be some level of regulation," Cook added. "I think the Congress and the administration at some point will pass something.""

• Amazon's open source headache. The Information had an interesting story on how Amazon is facing new challenges from open-source companies, specifically MongoDB. "MongoDB Inc., the company that oversees the open-source database of the same name, is modifying the licensing agreement for the software to make it harder for cloud providers like AWS to enjoy the benefits of the technologies without giving back to them. That change could stall the work to build the AWS database product or even scuttle the project. "

• Enterprise cloud update. Workbench's Vipin Chamakkala brings readers up to speed on the latest in enterprise cloud. He touches on serverless, cloud-native, AI/ML tooling, and an ongoing "rethink" of what enterprise IT team should look like.

• The rise of micro-brands. The Economist on why micro-brands are threatening consumer-goods giants. Technological change is a big driver of this development. 

• Airtable is a unicorn. Airtable raised $100M at a $1.1B valuation. As a devoted user, I totally get it. 

• Palantir is in trouble. The WSJ with a deep dive on Palantir's challenges in turning a profit: "As Palantir sought to expand from government into private industry, its business plan involved losing money early in hopes of lucrative assignments later. Jobs were labor-intensive, with software written in a bespoke programming language and taught one-on-one. Instead of salespeople, Palantir sent so-called forward-deployed engineers to meet potential clients. Some engineers answered skeptical questions from business prospects by suggesting companies simply plug their data into Palantir’s software and wait for it to spit out results—a suggestion some took as aggressive and presumptuous."

• Does the Qualtrics deal herald a coming era of big software M&A? Semil Shah offered his thoughts on the SAP's acquisition of Qualtrics. "It seems like at the end of every year I’ve been an investor, various blog posts will prognosticate on whether the following year will truly be the year when incumbents start getting nervous and spend their cash reserves and high-priced stock on a big splashy acquisition. And, every year, it doesn’t materialize that way. Instead, we’ve seen a few massive buys, like Whatsapp, or more recently, RedHat. Elad Gil, the founder of Color Genomics and widely considered one of the most-connected angel investors in the Bay Area tweeted after the Qualtrics announcement, “Feels like we just turned a corner on BigTechCo M&A and lots of activity for the next 6 months as companies rethink the strategic playing board. IBM & Redhat, MSFT & Github, SAP & Qualtrics – probably lots more large acquisitions to come….” Gil is one of the few who tend to be more right than wrong, and if that holds up, it will be very good news for up-and-coming enterprise software category leaders."

• Burger murder. Did technology kill the best burger in America?

How to Startup

• Product/Market fit. This week's must-read post is from the CEO of Superhuman on how the email SaaS company built an engine to find product/market fit. "I racked my brain for an answer on how to travel the distance between where Superhuman was and the high bar that we needed to hit. And I eventually started to wonder: what if you could measure product/market fit? Because if you could measure product/market fit, then maybe you could optimize it. And then maybe you could systematically increase product/market fit until you achieved it...."  One more quote: "To increase your product/market fit score, spend half your time doubling down on what users already love and the other half on addressing what’s holding others back." It's a great post. Read it. 

• Pivot or Fail? Fred Wilson wrote a great post on whether or not startups should pivot: "And I am not sure hard pivots are good for anyone...So my view is if you’ve failed, accept it, announce it, and deal with it. Shut the business down, give back the cash, and rip up the cap table. Then do whatever you want to do next. If it is another startup, do it from scratch and keep as much of it as you can. If it is something else, well then do that too."

• On hiring nonconformers. Wharton Professor Adam Grant offers his take on how (and why) to hire trail-blazers and non-conformers.

• Disconnecting. Mathilde Collin of Front on the importance of taking actual vacations (i.e. with no email). Take it from her. She runs an email company! "I’m fascinated by this inability to disconnect. If you care about your well-being, your performance at work, and the overall efficiency of your team, you should reconsider the way you approach vacationing."

• Willkommen in Berlin. Seven things to consider when expanding your tech business to Berlin. For example: "Before you start your business, you must notify the regulatory agency (Ordnungsamt) in the district your business will be based. During your meeting with them, you’ll need to present your identity card or passport, any required licenses, and documentation such as an extract from the Commercial Register, if registering a new corporation. You must also keep the Ordnungsamt informed about any changes you make to your business in the future."

How to Venture

• What does Softbank mean for seed investors? Hunter Walk of Homebrew asks how seed investors should respond if Softbank does a super-sized round in one of their companies. In a word, it's complicated. 

• Go small and prosper. Greg Sands of Costanoa Ventures on how companies can falter with big brands and prosper with boutique VCs.

Portfolio News & Jobs

Aquant announced Home Depot as a paying customer. "Aquant’s Artificial Intelligence (AI) platform has been chosen by Compact Power Equipment, a Home Depot company and a leader in on-site facility maintenance and equipment repair, to diagnose machine failures more quickly and accurately, optimize equipment life-cycle management and increase technician operational efficiency."

Innovid named as one of the fastest growing companies in North America.

- - - Portfolio Jobs - - -

Vault is hiring developers for front end and back end. Location flexible.

Cloud66 is hiring software engineers in London.

Moltin is hiring for multiple roles in the US and UK.